ALJDEC decisions subject to certification as final

2017A-6336-CHC-ROC · Registrar of Contractors · 2018-05-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Moran Contracting and Development Inc.,

COMPLAINANT,

v.

Universal Desert State Air LLC,

License No: 249198

RESPONDENT.

No. 2017A-6336-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: April 30, 2018

APPEARANCES: Shannon Moran, Owner and President, appeared on behalf of Complainant Moran Contracting and Development Inc. Michael Conklin, Owner and Qualifying Party, appeared on behalf of Respondent Universal Desert State Air, LLC.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

Universal Desert State Air LLC (Respondent) is the holder of License No. 249198 issued by the Arizona Registrar of Contractors (Registrar).

On or about April 13, 2017, Moran Contracting and Development Inc. (Complainant) signed a contract with Respondent for the installation of an HVAC system. The contract provided that the total cost of the contract was $10,900.00 with payments to be made as follows: “30% deposit for materials, 20% after rough in and balance at trim.” The contract also provided that “Any alteration or deviation from above specification involving extra costs will be executed only upon written orders, and will become an extra charge over and above the estimate. . . . Price guaranteed for 120 days from date of contract.” Of the contract price, Complainant paid the first two installments, or $5,450.00.

On or about December 27, 2017, the Registrar received a Complaint against Respondent from Complainant alleging abandonment with respect to the project.

The Registrar assigned the complaint to Investigator Timothy Pennington. After a jobsite inspection, Investigator Pennington issued a written directive to Respondent that provided as follows:

After investigation, the Registrar has substantiated that your work fails to meet minimum workmanship standards (see A.A.C. R4-9-108). Failure to comply with this Directive constitutes a violation of A.R.S. § 32-1154(A)(22) and may result in the issuance of a Citation, discipline of your license and a civil penalty pursuant to A.R.S. § 32-1154(E) of up to $500.00. Failure to comply with this Directive may also be treated as an aggravating factor should the Registrar pursue discipline of your license[.] You must provide the Registrar with satisfactory written proof of your compliance with this Directive prior to 5:00 p.m. on 2/10/2018.

You are hereby directed to remedy the following violations by the appropriate means:

South A/C unit not on roof or at location. Not installed.

North A/C unit not on roof or at location. Not installed.

The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action.

Following the issuance of the written directive, Respondent made no attempt to contact Complainant. After the deadline in the directive expired, Investigator Pennington was notified.

The Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(1); A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3); and A.R.S. § 32-1154(A)(22).

Investigator Pennington testified that the air conditioning units and registered had not been installed. When no work was done after the directive was issued, Investigator Pennington referred the matter to the legal department for a citation. Investigator Pennington stated that he did not observe any workmanship issues, other than that the job was not complete. Investigator Pennington testified that Respondent had indicated to him that the contract provided that the price was good for a certain period of time and that after that time, Respondent was not required to comply with the contract, but that he had never heard of such a clause being the cause of a contractor not complying with a signed contract.

Mr. Moran testified that he was unable to contact Respondent when it was time to complete the second phase of the contract. Mr. Moran stated that the only information they received was that Mr. Conklin was injured, but he would get his son to complete the work. After weeks of waiting, Complainant filed the complaint with the Registrar. Mr. Moran then got an email from Mr. Conklin stating as follows:

I got the ROC complaint today. Your [sic] wasting time. I’m physically unable to to [sic] do ANY work. I explained this to you on the phone but you must not believe me. I’m currently not doing any contracting and I won’t be for the foreseeable future. The money you paid me is for work I did. I didn’t rip you off like your [sic] making out that I did. And under the circumstances there is absolutely no trust between us. Do yourself a favor and have another company finish it. It will take months to go through the ROC and I’m going to tell them the same thing I’m telling you. And I can prove my condition with a ton of doctors tests and invoices.

Mr. Moran testified that Respondent had completed some work on the project, but that it was not fifty percent of the work to be done under the contract. Mr. Moran acknowledged that the cost of the equipment was a large part of the expense, but that the first payment under the contract was to pay for materials. Mr. Moran also stated that the only reason the project went beyond 120 days was because Respondent would not respond to his attempts to contact him for phase two of the contract.

Mr. Conklin testified that the rough in and ductwork was seventy-five percent of the work to be done under the contract, so the work performed exceed the monies paid under the contract. Mr. Conklin also noted that 148 days had passed since the contract was signed, so he was no longer obligated to complete the contract for the agreed upon price. Mr. Conklin asserted that the cost of the equipment increased in the interim and he was unable to purchase the equipment for the price that he used to arrive at the original contract. Mr. Conklin acknowledged that he did not attempt to secure a signed change order to account for the increased costs of the equipment. Mr. Conklin noted that he had gotten hurt at some point and was unable to work, and in fact, was still not working.

Administrative notice is taken of Respondent’s prior License record on May 21, 2018. Such prior License record reflects that Respondent’s License No. 249198 was first issued on September 25, 2008, and is current. Respondent’s licensed was on probation from January 3, 2013, through March 4, 2013; suspended for non-renewal from October 1, 2016, through September 29, 2017; suspended for lack of bond from October 30, 2016, through September 29, 2017; and subject to finite suspensions from September 21, 2016, through September 23, 2016; September 28, 2016, through October 2, 2016; and November 1, 2016, through November 5, 2016. Such prior License record also reflects that there were four previous complaints resulting in discipline and one complaint that was resolved/settled/withdrawn against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960).

While Respondent may have included a provision that the price of the contract was only valid for 120 days, Respondent was still obligated to complete the contract. Assuming, arguendo, that Respondent could require the price change after 120 days, Respondent admitted that he did not seek a written change order from Complainant to accomplish that price increase. Further, Mr. Moran testified that the only reason the contract went beyond 120 days was because Respondent failed to return his calls. Accordingly, the evidence established that Respondent failed to complete the contract without legal excuse. Therefore, Complainant established that Respondent abandoned the contract in violation of A.R.S. § 32-1154(A)(1).

Nothing in the record established that the work Respondent completed with respect to the project was not in conformity with the Registrar’s standards. Therefore, Complainant failed to establish that Respondent’s work was in violation of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3).

The evidence established that Respondent did not attempt to compete the corrective work following the Directive being issued. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent’s License No. 249198 for a period of 15 days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s final order, the Registrar revoke Respondent’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty.

In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be 40 days from the date of that certification.

Done this day, May 21, 2018

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors