ALJDEC decisions subject to certification as final

2018A-3669-NPC-ROC · Registrar of Contractors · 2018-11-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 17, 2018 APPEARANCES: Shawn Kearney appeared on behalf of Complainant McCardell Industries, LLC. Tim Marrs appeared on behalf of Marrs Construction, LLC. ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson _____________________________________________________________________ FINDINGS OF FACT 1. On or about August 9, 2018, Complainant McCardell Industries LLC DBA: Patterson Paving (“McCardell”) filed a Complaint against Respondent Marrs Construction, Inc. (“Marrs”) with the Arizona Registrar of Contractors (“Registrar”) alleging that Marrs had failed to pay Complainant the total sum of $32,415 for labor and materials provided for a paving construction project. 2. The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a formal Citation charging Respondent with a possible violation of A.R.S. § 32-1154(A)(10). 3. In 2018, McCardell and Marrs entered into a contract wherein McCardell agreed to provide paving construction work to Marrs on projects located in Phoenix and Lake Havasu. 4. McCardell performed the construction work under the agreement. 5. In March of 2018, McCardell issued invoices to Marrs for work done on the project in Phoenix for the total amount of $6,840. 6. On February 16, 2018, McCardell issued an invoice to Marrs for work done on the project in Lake Havasu in the total amount of $14,575. The invoice included $4,400 for mobilization and $4,400 for standby. 7. On May 6, 2018, McCardell issued an invoice to Marrs for work done note project in Lake Havasu in the total amount of $11,000. The invoice included $4,400 for mobilization. 8. Marrs failed to pay the total amount of $32,415 due for the paving construction work performed in Phoenix and Lake Havasu. 9. Marrs filed a timely response to the Citation. 10. The matter was referred to the Office of Administrative Hearings for an evidentiary hearing. 11. A hearing was held on October 17, 2018. 12. At hearing, Marrs did not dispute that it owed for the invoices billed for the work performed in Phoenix for the total amount of $6,840. 13. Marrs contended that it did not owe McCardell the mobilization and standby fees of $4,400 each as stated on the February 16, 2018 invoice for the work performed by McCardell in Lake Havasu. Marrs also contended that it did not owe the mobilization fee of $4,400 for the work performed in Lake Havasu as stated on the May 6, 2018 invoice. Marrs argued that it never agreed to a mobilization fee in the amount of $4,400, but only $550 per hour for transportation. Marrs contended that it never agreed to a standby fee. 14. Marrs argued that although McCardell submitted a proposal to O’Neal, the general contractor for the construction project, which included a mobilization fee of $4,400, Marrs never agreed to pay the fee. 15. McCardell contended that it charges $4,400 for mobilization for construction work performed outside of the Phoenix area. McCardell contended that Marrs agreed to the mobilization fee of $4,400 and the standby fee of $4,400. 16. McCardell contended that Marrs’s employee Nick Rhodes authorized the standby fee of $4,400. However, Marrs contended that Nick Rhodes was only an estimator and did not have authority to agree to the standby fee. 17. Despite several exchanges via electronic mail between McCardell and Marrs regarding the mobilization charge of $4,400 and standby fee of $4,400, McCardell did not dispute the charges until after a Complaint was filed with the Registrar. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these matters is by a preponderance of the evidence. See A.A.C. R2-19-119. 2. 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). 3. A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, [f]ailure by 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.

4. The preponderance of the evidence shows that Respondent owes Complainant the sum of $32,415 for labor and materials provided to Respondent in connection with his operations as a contractor. 5. Respondent failed to establish that it lacked the ability to pay Complainant for the work performed. 6. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(10) by failing to pay Complainant $32,415 for labor and material rendered in connection with Respondent’s contracting business. 7. Based upon Respondent’s violation of the provisions of A.R.S. § 32- 1154(A)(10), grounds exist to impose discipline against Respondent’s license. RECOMMENDed order Based on the foregoing, it is recommended that the Registrar suspend Marrs Construction, Inc.’s License No. 292010 and License No. 319690, issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $32,415 in certified funds. It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $32,415 in certified funds, the Registrar may close the Complaint in Case No. 2016- 3216. In the event of certification of this 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 the certification. Done this day, October 30, 2018.

/s/ Velva Moses-Thompson Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors

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