ALJDEC decisions subject to certification as final

2018A-04506-ROC · Registrar of Contractors · 2019-04-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 18, 2019, at 9:00 a.m. APPEARANCES: Complainants Peter and Lidia Ursu were represented by Christopher J. Charles, Esq., Provident Law; Complainants Svetlana Suleymanov and Mark Jakobov appeared on their own behalf; the Arizona Registrar of Contractors (“the Registrar”) was represented by Thomas Raine, Esq., Assistant Attorney General; Integrity Pools and Spas, Inc. (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure 1. On June 6, 1998, the Registrar issued License No. ROC 135859 for General Residential B-5 General Swimming Pool Contracting to Respondent.[1] On March 29, 2002, the Registrar issued License No. ROC 173181 for Specialty Dual CR-21 Hardscaping and Irrigation Systems to Respondent.[2] Respondent’s officer/qualifying party is listed as Gary Richard Dircks. 2. On February 26, 2019, the Registrar issued an Order of Summary Suspension, Order Consolidating Cases, and Notice of Promptly Instituted Proceeding under A.R.S. § 41-1092.11(B) against Respondent, setting an evidentiary hearing at the Office of Administrative Hearings, an independent agency, on March 5, 2019. 3. The February 26, 2019 Order of Summary Suspension charged cause to suspend Respondent’s contractor’s license under A.R.S. §§ 32- 1154(A)(1), A.R.S. § 32-1154(A)(2), A.R.S.§ 32-1154(A)(3), namely A.A.C. R4-9-108, A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158(A) and A.R.S. § 32-1158.01, A.R.S. § 32-1154(A)(17), and A.R.S. § 32- 1154(A)(22). The charges were based on four consumer complaints filed with the Registrar by Peter and Lidia Ursu (Case No. 2018-04506), Svetlana Suleymanov (Case No. 2018-05734),[3] Damien Allen Hill (Case No. 2018-2467), and Joey Luis Garza (Case No. 2018-05684). 4. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing. Because Mr. Ursu’s complaint in Case No. 2018-04506 and Ms. Suleymanov’s complaint in Case No. 2018-05734 had already been referred to OAH and set for hearing, these matters were consolidated with the Registrar’s own-motion complaint. 5. On February 28, 2019, the Registrar issued a Supplemental Notice that provided factual detail to support the charged violations in the February 26, 2019 Order of Summary Suspension. 6. The consolidated hearing was continued once at Respondent’s request. Staff at OAH sent to order continuing the hearing to Respondent at its address of record and/or email address. 7. A continued hearing was held on March 18, 2019. The Registrar submitted 41 exhibits and presented the testimony of five witnesses: (1) Chance Peterson, the Assistant Chief Counsel in the Registrar’s Legal Department; (2) Jim Dimond, the Investigator who took over the Registrar’s investigation of the complaint filed by Peter and Lidia Ursu (Case No. 2018-04506); (3) David Fagerburg, the Investigator assigned to Svetlana Suleymanov’s complaint (Case No. 2018-05734); (4) Steve Philpott, the Investigator assigned to Damien Hill’s complaint (Case No. 2018-2467); and (5) Jack Grimm, the Investigator assigned to Joey Luis Garza’s complaint (Case No. 2018-05784). Peter Ursu, Ms. Suleymanov, and Damien Hill testified. Mr. Ursu submitted two exhibits. 8. Respondent did not request to appear telephonically at the hearing that was continued at Mr. Dircks’ request, even though the hearing was continued to a date on which Mr. Dircks indicated that he would be available. No one requested that the hearing be continued a second time. Respondent did not appear, through an authorized officer, employee, or attorney. Consequently, Respondent did not present any evidence to defend its license. Hearing Evidence 9. Mr. Peterson testified that the Registrar’s Investigation Department brought to the Legal Department’s attention a number of similar complaints that consumers had filed against Respondent in a short time. The complaints alleged abandonment, poor work, and that Respondent had stopped responding to the consumers. Because unfinished swimming pools can present a safety hazard, the Registrar’s Legal Department determined to summarily suspend Respondent’s contractor’s licenses. 10. Mr. Peterson noted that Respondent did not use both licenses in all cases. Mr. Peterson testified that the Registrar had also received complaints for non-payment from Respondent’s subcontractors and suppliers. Mr. Peterson testified that the Registrar had also received more complaints from consumers, but that the Registrar’s investigation in those cases had not proceeded to the point where the cases could be referred for hearing. Peter and Lidia Ursu (Case No. 2018-04506) 11. Case No. 2018-04506 was originally assigned to the Registrar’s Investigator Timothy Pennington for investigation. Because Investigator Pennington had left his employment by the Registrar, Investigator Dimond reviewed Investigator Pennington’s notes and photographs to prosecute the complaint on behalf of the Registrar. 12. On October 5, 2017, Respondent entered into a contract with Peter and Lidia Ursu to construct a swimming pool and spa at 8385 West Park View Court, Peoria, Arizona 85383, for $71,390.00. Over the course of the next months, Mr. and Mrs. Ursu stated that they paid Respondent $50,000.00.[4] 13. On September 24, 2018, Mr. and Mrs. Ursu filed a complaint with the Registrar that Respondent had performed poor work and then abandoned the project. Mr. and Mrs. Ursu alleged that the total amount of their contract with Respondent was $68,600.00.[5] 14. On November 8, 2018, the Registrar’s Investigator Pennington conducted a jobsite inspection at 8385 West Park View Court, Peoria, Arizona 85383.[6] Respondent did not attend the inspection. Investigator Pennington determined that Respondent had abandoned the project. 15. On November 9, 2018, the Registrar issued a Written Directive that required Respondent to complete the project.[7] Respondent did not comply with the Directive. 16. On December 18, 2018, the Registrar issued a citation against Respondent’s License Nos. ROC 135859 and ROC 173181 for violations of A.R.S. §§ 32-1154(A)(1), (3), and (22).[8] Respondent filed a timely written answer to the citation.[9] 17. The Registrar referred Case No. 2018-04506 to OAH for an evidentiary hearing. A hearing was scheduled on March 18, 2019.[10] As noted above, after the summary suspension order, the matter was consolidated with the other three complaints for hearing with the Registrar’s own motion complaint.[11] 18. A prehearing jobsite inspection was held on February 28, 2019.[12] Investigator Dimond performed the prehearing jobsite inspection. Investigator Dimond testified that most of the pool equipment was behind the RV garage and that the pool and spa were 98% or 99% ready for the interior surface, but that no further work had been done and no pebble tech surface had been installed. Investigator Dimond noted that, although Investigator Pennington had substantiated abandonment, he did not substantiate that Respondent had committed poor workmanship in plumbing the pool and spa. 19. Peter Ursu testified that Peter and Lidia Ursu are his parents. Mr. Ursu testified that his parents had sued Respondent and obtained a default judgment against it in Maricopa County Superior Court Case No. CV2018-053351 on January 15, 2019, in the amount of $42,714.50 in principal and $600.00 in attorney’s fees pursuant to A.R.S. § 13- 341.01.[13] Mr. Ursu testified that Respondent has not been back to the project, even though his parents had paid Respondent to make sure that the permits were up to date, and that his parents had to hire a contractor to finish the gas line before the expiration of the permit. Svetlana Suleymanov and Mark Jakobov (Case No. 2018-05374) 20. On or about January 11, 2018, Svetlana Suleymanov and Mark Jakobov entered into a contract with Respondent to construct a swimming pool and spa at 19008 N. 22nd Street, Phoenix, Arizona 85024, for $40,000.00.[14] Over the next six months, Ms. Suleymanov and Mr. Jakobov stated that they paid Respondent a total of $45,500.00. 21. On November 7, 2018, Ms. Suleymanov and Mr. Jakobov filed a complaint with the Registrar against Respondent’s License Nos. ROC 135859 and ROC 173181, alleging abandonment.[15] Ms. Suleymanov and Mr. Jakobov provided with their complaint a handwritten note from Respondent dated August 24, 2018, promising to complete the project by September 7, 2018.[16] 22. On December 3, 2018, the Registrar’s Investigator David Fagerburg conducted a jobsite inspection.[17] Respondent did not attend the inspection. Investigator Fagerburg determined that Respondent had performed poor work that did not comply with professional industry standards, in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9- 108. 23. On December 4, 2018, the Registrar issued a warning letter to Respondent for utilizing a contract that did not contain all the elements required by A.R.S. §§ 32-1158(A).[18] 24. Investigator Fagerburg testified that Respondent had charged Ms. Suleymanov and Mr. Jakobov for a hard dig. When Investigator Fagerburg saw the pool, it was full of water. Investigator Fagerburg testified that he could not substantiate that the pool was supposed to be salt water or to have bullnose edging, because those terms were based on oral contracts. Investigator Fagerburg testified that the parties’ contract did call for a disposable filter, but that Respondent had installed a sand filter. 25. Investigator Fagerburg testified that there was no bubbler near the 16”-deep Baja step, which contract called for. Investigator Fagerburg testified that the bubbler had to be put in during construction and could no longer be installed without demolition. 26. Investigator Fagerburg testified that the contract for hardscape required three 24” columns, but that Ms. Suleymanov and Mr. Jakobov had eliminated one of the columns. The columns were meant to provide a fire feature. However, the two columns that Respondent constructed did not have any gas line stub outs, so could not serve their intended purpose. All Investigator Fagerburg saw on the jobsite was a 5-gallon propane tank, with no piping to the features. 27. Investigator Fagerburg testified that the contract required a color logic pool and spa, but that respondent had installed just white bulbs. The color logic controller was not at the jobsite. 28. Ms. Suleymanov testified that the pool gets cloudy, when it is supposed to be clear. She made numerous calls and sent numerous text messages to Respondent, but even though Mr. Dircks said he would come out, he never did. Ms. Suleymanov testified that she contacted three other contractors, who told her that the Pentair brand variable pump that Respondent installed was not powerful enough to keep the water clear. Ms. Suleymanov testified that the sized pump that the pool needs to stay clear is more expensive than the pump that Respondent installed, but that she trusted Respondent to pick the right sized pump for her brand-new pool 29. On December 10, 2018, the Registrar issued a Written Directive, requiring Respondent to remedy the violations by December 27, 2018.[19] 30. Investigator Fagerburg testified that the directive was returned to the Registrar. He tried to contact Mr. Dircks through email and Mr. Dircks responded immediately, stating that Respondent’s address was the same. Investigator Fagerburg testified that the emailed the directive to Respondent. 31. Investigator Fagerburg conducted a compliance inspection on December 31, 2018.[20] Investigator Fagerburg determined that Respondent had made no effort to comply with the directive. 32. On January 11, 2019, the Registrar issued a citation against Respondent’s License Nos. ROC 135859 and ROC 173181 for violations of A.R.S. §§ 32-1154(A)(3) and (22).[21] Respondent filed a timely written answer to the citation.[22] 33. The Registrar referred Case No. 2018-05374 to OAH for an evidentiary hearing. A hearing was scheduled on March 21, 2019.[23] As noted above, after the summary suspension order, the matter was consolidated with the other three consumer complaints for hearing with the Registrar’s own motion complaint.[24] Damien Hill (Case No. 2018-2467) 34. On March 4, 2017, Damien Allen Hill entered into a contract with Respondent to construct a swimming pool and spa and to perform landscaping work at 16228 East Gamble Lane, Scottsdale, Arizona 85262, for $113,700.00.[25] 35. On June 1, 2018, Mr. Hill filed a complaint with the Registrar against Respondent’s License Nos. ROC 135859 and ROC 173181, alleging abandonment.[26] Mr. Hill alleged that the contract amount had increased to $141,700.00 due to change orders and that he had paid Respondent $116,000.00. 36. On July 2, 2018, the Registrar’s Investigator Steve Philpott conducted a jobsite inspection at 16228 East Gamble Lane, Scottsdale, Arizona 85262.[27] Respondent did not attend the jobsite inspection. Investigator Philpott substantiated that Respondent’s workmanship on the job was poor. 37. Investigator Philpott testified that the project was for a new swimming pool plus landscaping. Investigator Philpott testified that he emailed Respondent, but that it never responded and that he had not spoken to Respondent on the phone or through text or email. Investigator Philpott testified that, although the pool had been started more than two years ago, it was only 80% complete. The wall rebar was not complete and there was no stucco, with an empty area in the yard that was supposed to be hardscape. Investigator Philpott testified that the pool was close to being ready for installation of a surface. 38. On July 2, 2018, the Registrar issued a warning letter to Respondent for using a contract that did not include all the elements required by A.R.S. § 32-1158(A).[28] On July 2, 2018, the Registrar also issued a warning letter to Respondent for using a contract that did not include all the elements required by A.R.S. § 32-1158.01, which is specific to swimming pool contractors.[29] 39. On July 2, 2018, the Registrar issued a warning letter to Respondent for contracting under a suspended license in violation of A.R.S. §§ 32- 1151 and 32-1154(A)(17).[30] 40. On July 2, 2018, the Registrar issued a Written Directive, requiring Respondent to complete the project by July 19, 2018.[31] The directive advised Respondent that “[i]f your license 135859 is suspended for administrative reasons or is revoked, expired, or cancelled, you may not contract in any manner and may remedy the workmanship violations listed above only by paying a properly licensed contractor hired by Complainant to remedy your deficient workmanship or by reaching a financial settlement with Complainant.”[32] 41. Investigator Philpott testified that on July 29, 2018, he received an email from Mr. Hill, requesting that the complaint be put on hold because Mr. Hill had reached a tentative schedule for completion of the pool with Respondent. Investigator Philpott testified that he told Mr. Hill that he would close the complaint and reopen it in six months if Respondent had not resolved the complaint. Mr. Philpott testified that Respondent’s license was suspended at the time of the jobsite inspection. 42. Investigator Philpott conducted a compliance inspection on January 15, 2019.[33] Investigator Philpott determined that, although some work had been done, the project remained unfinished. 43. Investigator Philpott testified that some of the pool equipment was not installed or operational. Although some work had been done on the spa, it still did not have a final surface. There was unfinished electrical work in the outdoor kitchen. Investigator Philpott testified that he did not recommend that Respondent be charged with abandonment because Respondent never said that it would not complete the project. 44. On February 13, 2019, the Registrar issued a citation against Respondent’s License Nos. ROC 135859 and ROC 173181 for violations of A.R.S. §§ 32-1154(A)(3), (12), (17), and (22).[34] Respondent filed a timely written answer to the citation.[35] 45. As noted above, on February 26, 2019, the Registrar issued an order summarily suspending Respondent’s License Nos. ROC 135859 and ROC 173181 and consolidating Case Nos. 2018-04506, 2018-05734, 2018, 2467, and 2018-05684 with the Registrar’s own-motion complaint in Case No. 2019-00858.[36] 46. Mr. Hill testified that Respondent had not performed any work since the compliance inspection. The grading and drainage on the project were final and had been inspected by the county. Although the pool equipment was on-site, because the pool did not have any pebble tech surface, it could not be filled. Stucco had been applied to the walls and a gate installed, but the stucco was falling off the walls. The columns could not be used because they needed to be filled with concrete to support any weight. An electrical switch was missing at the front of the house and electrical elements were missing from the outdoor kitchen, although Respondent had run Romex to the pool and outdoor kitchen. Redheads were missing. Joey Luis Garza (Case No. 2018-05684) 47. On February 13, 2018, Joey Luis Garza entered into a contract with Respondent for landscaping construction work at 842 East Beverly Road, Phoenix, Arizona 85042, for $35,200.00.[37] 48. On November 30, 2018, Mr. Garza filed a complaint with the Registrar against Respondent’s License Nos. ROC 135859 and ROC 173181, alleging abandonment.[38] Mr. Garza stated that Respondent’s proposal was the only document used as a contract and that he had paid Respondent $30,000.00. Mr. Garza also stated that Respondent promised that the project would be completed within six to eight weeks after the first payment. 49. On February 14, 2019, the Registrar’s Investigator Jack Grimm conducted a jobsite inspection.[39] Respondent did not attend the jobsite inspection. Investigator Grimm substantiated poor workmanship, abandonment, and lack of permits. 50. Investigator Grimm testified that the project required extensive hardscape, including a splash-pad, foundation, and pavers and that a permit was required for the project. After eight months, little work had been performed. Although Complainant had paid $30,000.00, or 80% of the contract price, only 20% of the work on the project had been performed. 51. Investigator Grimm testified that there was no firebrick in the outdoor pizza oven and that there was no electrical or plumbing for the outdoor kitchen. There was no plumbing for the water feature or electrical installed in anything, although the trampoline was partially installed. There was poor work on the cuts of facings of the planters on the east and west sides of the project. Sand had been brought in, but no pavers placed on the sand in the side yards. What pavers had been installed in the front yard were sinking. 52. On February 8, 2019, the Registrar issued a warning letter to Respondent for using a contract that did not contain the nine elements that A.R.S. § 32-1158(A) required.[40] 53. On February 8, 2019, the Registrar issued a warning letter to Respondent for failing to obtain required building permits, a violation of A.R.S. § 32-1154(A)(2).[41] 54. On February 8, 2019, the Registrar issued a Written Directive, requiring Respondent to obtain necessary permits, correct poor work, and complete the project by February 26, 2019.[42] 55. As noted above, on February 26, 2019, the Registrar issued an order summarily suspending Respondent’s License Nos. ROC 135859 and ROC 173181 and consolidating Case Nos. 2018-04506, 2018-05734, 2018, 2467, and 2018-05684 with the Registrar’s own-motion complaint in Case No. 2019-00858.[43] CONCLUSIONS OF LAW 1. These matters lie within the Registrar’s jurisdiction.[44] 2. The order continuing the hearing at Respondent’s request that OAH staff sent to Respondent at its address of record and/or email address was reasonable and Respondent is deemed to have received notice of the continued hearing.[45] 3. The summarily suspended status of Respondent’s licenses does not deprive the Registrar of its ability to prosecute these complaints or prevent the Registrar from determining the merits of these complaints.[46] 4. The Registrar bears the burden to establish grounds for suspension or revocation of Respondent’s contractor’s license by a preponderance of the evidence.[47] Respondent bears the burden to establish affirmative defenses and factors in mitigation of the penalty by the same evidentiary standard.[48] 5. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[49] A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”[50] 6. The Registrar established a pattern of Respondent contracting to construct elaborate pools or hardscape, accepting monies that greatly exceeded the amount of work that it had performed, then failing to repair or complete the projects. 7. A.R.S. § 32-1154(A)(1) includes among the grounds to suspend or revoke a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” The Registrar established that Respondent abandoned Peter and Lidia Ursu’s project (Case No. 2018-04506), Ms. Suleymanov and Mr. Jakobov’s project (Case No. 2018A-05374), and Mr. Garza’s project (Case No. 2018A-05684). The Registrar established grounds to suspend or revoke Respondent’s contractor’s licenses under A.R.S. § 32-1154(A)(1). 8. A.R.S. § 32-1154(A)(2) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[d]eparture from or disregard of plans or specifications or any building codes of any state or any political subdivision of the state in any material respect which is prejudicial to another without consent of the owner or the owner’s duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.” The Registrar established that Respondent failed to obtain necessary permits for Mr. Garza’s project (Case No. 2018-05684). The Registrar established grounds to suspend or revoke Respondent’s contractor’s licenses under A.R.S. § 32- 1154(A)(2). 9. A.R.S. § 32-1154(A)(3) includes among the grounds to suspend or revoke a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” A.A.C. R4-9-108(A) states that “[a] contractor shall perform all work in a professional and workmanlike manner.” A.A.C. R4-9-108(B) states, in pertinent part, that “[a] contractor shall perform all work in accordance with any applicable building codes and professional industry standards.” The Registrar established that Respondent performed poor work on Mr. and Mrs. Ursu’s project (Case No. 2018-04506), Ms. Suleymanov and Mr. Jakobov’s project (Case No. 2018-05734), Mr. Hill’s project (Case No. 2018-2467), and Mr. Garza’s project (Case No. 2018-05684). The Registrar established grounds to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3) and A.A.C. R4-9-108. 10. A.R.S. § 32-1158(A) provides that any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved must be in writing and must include the following minimum terms: 1. The name of the contractor and the contractor’s business address and the license number.

2. The name and mailing address of the owner and the jobsite address or legal description.

3. The date the parties entered into the contract.

4. The estimated date of completion of all work to be performed under the contract.

5. A description of the work to be performed under the contract.

6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes.

7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner.

8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract.

9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar’s telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A. The information in this paragraph must be prominently displayed in the contract in ten point bold type. . . .

A.R.S. § 32-1158.01(A) applies to contractor’s contracts to construct swimming pools and spas and provides as follows: In addition to the requirements of section 32-1158, a licensed contractor who enters into a contract for the construction or installation of a residential in-ground swimming pool or spa with a purchaser who resides in the residence or who intends to reside in the residence after the completion of the contract shall include at least the following provisions:

1. A provision providing the purchaser the opportunity to request standard contractor's payment and performance bonds in a form approved by the registrar, securing the completion of the work and payment for services and materials. The cost of the payment and performance bond shall be paid by the purchaser of the swimming pool or spa and the contractor shall not charge a surcharge or a service charge.

2. The following payment provisions:

(a) A down payment payable on the execution of the contract of not more than fifteen percent of the original contract price.

(b) After the completion of the excavation work on the swimming pool or spa, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(c) After the installation of steel, plumbing and pneumatically applied concrete materials or the installation of a prefabricated swimming pool or spa, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(d) After the installation of decking materials, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(e) Before the application of the finishing interior materials or completion of all work on a prefabricated pool or spa, payment of all remaining sums due on the original contract plus any written change orders approved by the purchaser.

3. A provision that gives notice to the purchaser, in a form that is approved by the registrar and that is in at least ten point type, of the purchaser's right to receive written material that advises the purchaser of the provisions of this section and of the procedures provided for by the registrar for the resolution of claims and disputes with licensed contractors. 4. A provision in a form that is approved by the registrar and that is in at least ten point type, advising the purchaser of the purchaser's rights under title 44, chapter 15.

The Registrar established that Respondent’s contract with Mr. Hill (Case No. 2018-2467) violated A.R.S. §§ 32-1158(A) and 32-1158.01(A) and that Respondent’s contract with Mr. Garza violated A.R.S. § 32-1158(A). The Registrar established grounds to suspend or revoke Respondent’s licenses under A.R.S. § 32-1154(A)(12).[51] 11. A.R.S. § 32-1154(A)(17) includes among the grounds to suspend or revoke a contractor’s license, “[c]ontracting or offering to contract or submitting a bid while the license is under suspension or while the license is on inactive status.” The Registrar established that Respondent promised to complete Mr. Hill’s project while its license was suspended. The Registrar established grounds to suspend or revoke Respondent’s licenses under A.R.S. § 32-1154(A)(17). 12. A.R.S. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.” The Registrar established that Respondent failed to comply with the directives issued in Mr. and Mrs. Ursu’s complaint (Case No. 2018-04506), Ms. Suleymanov and Mr. Jakobov’s complaint (Case No. 2018-05734), and Mr. Hill’s complaint (Case No. 2018-2467) without legal excuse for the failure. The Registrar established grounds to suspend or revoke Respondent’s licenses under A.R.S. § 32-1154(A)(22). 13. With respect to the penalty, Respondent’s failures to respond to the complaints or to attend the hearing, which was continued at Respondent’s request, indicate that, at this time, Respondent cannot be regulated. RECOMMENDED ORDER In light of the foregoing facts and conclusions of law, IT IS ORDERED affirming the Registrar’s February 26, 2019 Order of Summary Suspension of Respondent Integrity Pools and Spas Inc.’s License Nos. ROC 135859 and ROC 173181 because the public health, safety or welfare imperatively required emergency action under A.R.S. § 41-1092.11(B). IT IS FURTHER RECOMMENDED that on the effective date of the final order in this matter, Respondent’s License Nos. ROC 135859 and ROC 173181 shall be revoked. 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 five days from the date of that certification. Done this day, April 2, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] See the Registrar’s Exhibit 5. [2] See the Registrar’s Exhibit 6. [3] After Case No. 2018-05734 was referred to the Office of Administrative Hearings, Ms. Suleymanov moved to add her partner, Mark Jakobov, as a party complainant. [4] See the Registrar’s Exhibit 7. [5] See the Registrar’s Exhibit 8. [6] See the Registrar’s Exhibit 9. [7] See the Registrar’s Exhibit 10. [8] See the Registrar’s Exhibit 11. [9] See the Registrar’s Exhibit 12. [10] See the Registrar’s Exhibit 13. [11] See the Registrar’s Exhibit 14. [12] See the Registrar’s Exhibit 14. [13] See Mr. and Mrs. Ursu’s Exhibit 2 (October 2, 2018 Verified Complaint) and 5 (Default Judgment). [14] See the Registrar’s Exhibit 16. [15] See the Registrar’s Exhibit 17. [16] See the Registrar’s Exhibit 16 at 1. [17] See the Registrar’s Exhibit 18. [18] See the Registrar’s Exhibit 19. [19] See the Registrar’s Exhibit 20. [20] See the Registrar’s Exhibit 21. [21] See the Registrar’s Exhibit 22. [22] See the Registrar’s Exhibit 23. [23] See the Registrar’s Exhibit 24 [24] See the Registrar’s Exhibit 15. [25] See the Registrar’s Exhibit 25. [26] See the Registrar’s Exhibit 26. [27] See the Registrar’s Exhibit 27. [28] See the Registrar’s Exhibit 28. [29] See the Registrar’s Exhibit 29. [30] See the Registrar’s Exhibit 30. [31] See the Registrar’s Exhibit 31. [32] The Registrar’s Exhibit 31. [33] See the Registrar’s Exhibit 32. [34] See the Registrar’s Exhibit 33. [35] See the Registrar’s Exhibit 34. [36] See the Registrar’s Exhibit 15. [37] See the Registrar’s Exhibit 35. [38] See the Registrar’s Exhibit 36. [39] See the Registrar’s Exhibit 38. [40] See the Registrar’s Exhibit 39. [41] See the Registrar’s Exhibit 40. [42] See the Registrar’s Exhibit 41. [43] See the Registrar’s Exhibit 15. [44] See A.R.S. § 32-1154(A). [45] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [46] See A.R.S. § 32-1154(D). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such licensee, or to render a decision suspending or revoking such a license . . . .” [47] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [48] See A.A.C. R2-19-119(B)(2). [49] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [50] Black’s Law Dictionary at 1220 (8th ed. 1999). [51] A.R.S. § 32-1154(A)(12) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.”

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Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826