ALJDEC decisions subject to certification as final

2018A-1705-CHC-ROC · Registrar of Contractors · 2018-08-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

ABC Supply Co Inc,

COMPLAINANT,

v.

C C A T Stucco Specialists LLC ,

License No: 230763

RESPONDENT.

No. 2018A-1705-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 13, 2018

APPEARANCES: Edward Marko, Complainant’s Attorney, Dustin Cover,

Complainant, Charles Anu Acha-Morfaw, Respondent.

ADMINISTRATIVE LAW JUDGE: Randolph D. Wolfson

_____________________________________________________________________

FINDINGS OF FACT

On May 10, 2018, the Registrar of Contractors (“ROC”) issued a Citation against C C A T Stucco Specialists LLC, License No: 230763 (hereinafter, “CCAT”) alleging that on April 12, 2018, Complainant ABC Supply Co Inc. (hereinafter, “ABC”) against CCAT. The written Complaint charged CCAT with the commission of an act or acts that would, if proved, be cause for the suspension or revocation of CCAT’s license under A.R.S. § 32-1154(A)(10).

This matter was properly noticed for hearing and on August 13, 2018, a hearing was conducted before the Office of Administrative Hearings, an independent agency.

On March 8, 2015, CCAT entered into a credit agreement with ABC and credit was extended to CCAT. Between March 17, 2018 and April 21, 2018, CCAT ordered and received delivery of stuccoing materials and supplies from ABC, which supplies and materials were delivered to CCAT at its jobsite. Submitted to CCAT were invoices totaling (after deducting late charges) $5,186.90.

Mr. Charles Acha-Morfaw, Qualifying Party for CCAT, testified that he was told by one of his crew that the crew member paid ABC’s field representative four thousand dollars ($4,000.00) in cash on the outstanding invoices. The person who is alleged to have made the cash payment is in Mexico and was neither called nor appeared for hearing. No one testified that there was any witness of anyone from CCAT making this $4,000. Payment to ABC. Mr. Acha-Morfaw admits he has no receipt for this cash payment, has no accounting records from his bank or his accountant evidencing the transfer or payment of the cash amount. Mr. Acha-Morfaw said that he thinks that the $4,000.00 cash payment was disclosed to CCAT’s accountant so that it could be deducted as an expense for tax purposes, but he was not sure. CCAT’s accountant was not requested by CCAT to appear for hearing nor was its accountant called for testimony at the hearing. Mr. Acha-Morfaw admits that CCAT was paid $26,000.00 for the job where the materials and supplies at issue in this case were used and stated that no more payment was owed CCAT for that job. He testified that he used the $26,000.00 to pay other materials and suppliers, paid sub-contractors and paid CCAT with the job’s funds, but that CCAT did not pay ABC from this job’s funds. Mr. Acha-Morfaw admitted in his opening statement for CCAT and at several points in the hearing - including his final argument - that CCAT did receive materials from ABC and that CCAT does not dispute the amount owed in this case.

Mr. Dustin Cover, General Manager of the Mesa, Arizona branch of ABC testified that of the hearing date, CCAT had not made any payments to ABC for the shipments and invoices at issue. He testified that in his 18 years in the business with ABC, there has never been an occasion where a field salesman or representative of ABC accepted a cash payment for any amount, let alone for $4,000.00 in case. He said that the $4,000.00 payment never happened. Mr. Cover confirmed that its invoices to CCAT were accurate and that after deductions for late charges, the total owed ABC from CCAT is $5,186.90.

CONCLUSIONS OF LAW

A party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. 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 32-1154(A) provides:

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: .... 10. Failure by a licensee or agent or official of a licensee to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee's operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.

The preponderance of the evidence shows that Respondent violated Ariz. Rev. Stat section 32-1154(A)(10) as alleged.

A review of the license status of record with the ROC indicates that Since August 1, 2018, CCAT’s license has been and is currently under administrative suspension for lack of bond.

RECOMMENDED ORDER

IT IS RECOMMENDED that on the effective date of the final Order in this matter C C A T Stucco Specialists LLC, License No: 230763 is revoked unless ROC receives and accepts written verification that C C A T Stucco Specialists, LLC has paid to ABC Supply Co Inc. $5,186.90 in certified funds.

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, August 15, 2018.

/s/Randolph D. Wolfson

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors