ALJDEC decisions subject to certification as final

2018A-05800-ROC · Registrar of Contractors · 2019-04-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 27, 2019 APPEARANCES: Bonny Allan, ROC, Thomas Paine, Esq., attorney for the ROC, Dan Schmidt, Qualifying Party and Respondent, Bryan Kolpin, employee of Respondent.

ADMINISTRATIVE LAW JUDGE: Randolph D. Wolfson _____________________________________________________________________ FINDINGS OF FACT On September 8, 2015, the Registrar of Contractors (“ROC”) issued a Notice of Hearing setting the above-captioned matter for hearing on March 27, 2019, at the Office of Administrative Hearings in Phoenix, Arizona. Respondent Moonraker LLC, [hereinafter “Moonraker”] holds license number ROC 320748 issued by ROC.[1] Dan Schmidt is listed on the licenses of N X S Construction, LLC, ROC license number 316256 and 237833 [hereinafter “N X S”].[2] On July 5, 2018, the Registrar issued License No. 320748 to Moonraker. Daniel James Schmidt (“Schmidt”) was named as the member and the qualifying party on Moonraker’s License No. 320748.[3] On September 21, 2007, the Registrar issued License No. 237833 to N X S Construction, LLC (“N X S”)[4] On November 2, 2017, the Registrar issued License No. 316256 to N X S Construction, LLC (“N X S”).[5] Mr. Schmidt was named as the member and the qualifying party on both of N X S’s licenses and therefore he is a Person Named on License Nos. 237833 and 316256. On or about December 6, 2018, the Registrar summarily suspended License Nos.237833 and 316256 pursuant to an Order of Summary Suspension.[6] An expedited hearing was thereafter held on December 17, 2018. The Administrative Law Judge upheld the Order of Summary Suspension and recommended revocation of License Nos. 237833 and 316256. The recommendation of the Administrative Law Judge was adopted by the Registrar in its Final Administrative Decision and Order dated January 10, 2019.[7] The December 6, 2018 summary suspension Order regarding License Nos. 237833 and 316256 consolidated five separate Complaints against N X S.[8] On or about December 5, 2018, Complaint 2018-05675 was filed against N X S as follows:[9] • Contract date March 12, 2018 • By homeowner, Diane Salinas • alleging poor work and abandonment which resulted in suspension and will culminate in revocation on February 17, 2019.

On or about December 5, 2018, Complaint 2018-05775 was filed against N X S as follows:[10] • Contract date August 14, 2018, • By homeowner, Ronald Meyerson • alleging poor work and abandonment which resulted in suspension and will culminate in revocation on February 17, 2019.

On or about December 5, 2018, Complaint 2018-05776 was filed against N X S as follows:[11] • Contract date July 5, 2018 • By homeowner, Cory Vanderpoel • alleging abandonment which resulted in suspension and will culminate in revocation on February 17, 2019.

On or about December 5, 2018, Complaint 2018-05777 was filed against N X S as follows:[12] • Contract date April 18, 2018 • By homeowner, Tod Eichacker • alleging poor work and abandonment which resulted in suspension and will culminate in revocation on February 17, 2019.

On or about December 5, 2018, Complaint 2018-05779 was filed against

N X S as follows:[13] • Contract date July 24, 2018 • By homeowner, Robert Miller • alleging abandonment which resulted in suspension and will culminate in revocation on February 17, 2019.

On or about December 7, 2018, Complaint 2018-05804 was filed against N X S as follows:[14] • Contract date September 7, 2018 • By homeowner, Patricia Hill • alleging abandonment which culminated in revocation, Order dated January 14, 2019

On or about December 14, 2018, Complaint 2018-05947 was filed against N X S as follows:[15] • Contract date July 11, 2018 • By homeowner, Steven Young • alleging poor work and abandonment which culminated in revocation, Order dated January 14, 2019.

On or about December 17, 2018, Complaint 2018-05978 was filed against N X S as follows:[16] • Contract date August 17, 2018 • By homeowner, Geoffrey Rulland • alleging poor work and abandonment which culminated in revocation, Order dated January 14, 2019

On or about December 7, 2018, Complaint 2018-05801 was filed against N X S as follows: • Contract date August 15, 2018 • By homeowner, Daniel Richy • alleging abandonment which culminated in revocation, Order dated January 14, 2019

On or about December 7, 2018, Complaint 2018-05830 was filed against N X S as follows: • Contract date July 25, 2018 • By homeowner, Rex Webb • alleging abandonment which culminated in revocation, Order dated January 14, 2019,

On or about December 14, 2018, Complaint 2018-05945 was filed against N X S as follows: • Contract date July 3, 2018 • By homeowner, Cheri Dollof • alleging abandonment which culminated in revocation, Order dated January 14, 2019.

At the time the acts and omissions referred to In paragraphs 7 through and including paragraph 17 herein occurred, Mr. Schmidt was named on the suspended and revoked licenses of N X S, License Nos. 237833 and 316256.[17]

The Citation[18] alleged the following charges Charge 1: A.R.S. § 32-1154(A) The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions.

. . . (20) Having a person named on the license who is or was named on any other license in this state or in another state that is under suspension or revocation for any act or omission that occurs while the person is or was named on the license unless the prior revocation was based solely on a violation of this paragraph.

A.R.S. § 32-1161(A) After suspension of the license upon any of the grounds set forth in section 32-1154, the Registrar shall renew it upon proof of compliance by the contractor with provision of the judgment relating to renewal of the license, or in the absence of a judgment or provisions therein as to renewal, upon proper showing that all loss caused by the act or omission for which the license was suspended has been fully satisfied.

A.R.S. § 32-1161(C) After revocation of a license upon any of the grounds set forth in section 32-1154, the license shall not be renewed or reissued for one year after final determination of revocation and then only on proper showing that all loss caused by the act or omission for which the license was revoked has been fully satisfied

The Registrar’s Citation in this case asserts that he conduct and circumstances set forth above, constitute violations of statute by Respondent’s activities of having a person named on the license that was also named on a suspended or revoked license.[19] Thus, the Registrar asserts Moonraker’s License No. 320748 is subject to discipline because a person named on Moonrakers’s license is responsible for the un-remedied harm caused by the revoked N X S licenses.[20] At the March 27, 2019 hearing in this matter, Mr. Dan Schmidt testified. on the record under oath. Mr. Schmidt acknowledged that he had been and still is the qualifying party for N X S and is a member of N X S’ LLC. Mr. Schmidt acknowledged that he was named on the suspended and revoked licenses of N X S, License Nos. 237833 and 316256 at the time the acts and omissions alleged in the Citation occurred. Mr. Schmidt admits to the best of his knowledge, no fines or civil penalties have been paid as ordered regarding the N X S cases and that none of the losses caused by the acts or omissions of N X S [for which the license was disciplined] have been fully satisfied. After the Registrar’s opening statement, Moonraker waived its opening statement. Mr. Schmidt thereupon stipulated, on the record, that Moonraker “…does not wish to contest the Citation.” Mr. Schmidt, on behalf of Moonraker, stated on the record that Moonraker “stipulates to all of the facts and allegations contained in the Citation” and does not desire to contest the Citation. The Registrar argued that under Ariz. Rev. Stat. section 32-1154(A)(20), it is required to suspend Moonraker’s license until the losses that led to N X S’s revocation have been fully satisfied.[21]

CONCLUSIONS OF LAW ROC bears the burden of persuasion. Ariz. Rev. Stat. § 41-092.07(G)(2). The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119. A preponderance of the evidence is: The 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.

Black’s Law Dictionary 1373 (10th ed. 2014). Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes."). “Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B). The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995). Ariz. Rev. Stat section 32-1155(A)(20) provides that: The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: …. (20) Having a person named on the license who is or was named on any other license in this state or in another state that is under suspension or revocation for any act or omission that occurs while the person is or was named on the license unless the prior revocation was based solely on a violation of this paragraph.

Ariz. Rev. Stat section 32-1161(A) provides that: After suspension of the license upon any of the grounds set forth in section 32-1154, the registrar shall renew it upon proof of compliance by the contractor with provisions of the judgment relating to renewal of the license, or in the absence of a judgment or provisions therein as to renewal, upon proper showing that all loss caused by the act or omission for which the license was suspended has been fully satisfied.

The preponderance of the evidence shows that Mr. Dan Schmidt was named on N X S’s license when acts or omissions occurred that led to N X S’s license being revoked. Consequently, ROC has met the burden of proof to show that Moonraker’s license should be subject to discipline. RECOMMENDED ORDER IT IS RECOMMENDED that on the effective date of the final Order in this matter, Moonraker LLC’s license number ROC 320748 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 is forty days after the date of that certification. Done this day, April 15, 2019.

/s/ Randolph D. Wolfson Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] Administrative Judicial notice is taken of the entirety of the Registrar’s manual and electronic records, including, but not limited to, the Registrar’s public access website. Moreover, ROC Exhibits 1 through and including Exhibit 10 were admitted into evidence at the March 27, 2019 hearing in this matter without objection. [2].See, ROC Exhibits 2 and 3. [3] See, ROC Exhibit 1 [4] Ibid. [5] Id. [6]Complaints 2018-05675, 2018-05775, 2018-05776, 2018-05777, and 2018- 05779 were Ordered consolidated. [7] ROC Exhibit 4. [8] Ibid. [9] Id. [10] Id. [11] Id. [12] Id. [13] Id. [14] Id. [15] Id. [16] ROC Exhibit 5. [17] Mr. Schmidt may not be named on Moonraker’s license according to A.R.S. § 32-1161(A) and (C). [18] Agency Record, pages 7-14 [19] Ibid. [20] Id. [21] Neither party presented evidence or legal argument regarding whether Moonraker’s license would be subject to discipline if Mr. Dan Schmidt is removed as a person named on the Moonraker’s license.

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