FINACT2018A-3938-ROC.pdf

2018A-3938-ROC · Registrar of Contractors · 2019-03-06

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Barcelo Electric LLC, Case No. 2018-3938 COMPLAINANT, Docket No. 2018A-3938-ROC v. FINAL ADMINISTRATIVE DECISION Stephen Bart Benge, AND ORDER DBA: Stephen Bart Benge Construction, License No. ROC 256398, RESPONDENT.

Under A.R.S. § 41-1092.08(B), the Registrar may review and accept, modify, or reject an

administrative law judge’s written decision. If the Registrar modifies or rejects that decision, then the

Registrar must provide written justification setting forth the reasons for the modification or rejection.

REGISTRAR’S ACCEPTANCE

In this case, a hearing was held, and the administrative law judge issued a written decision. See

Administrative Law Judge Decision, attached. The Registrar reviewed that decision and hereby accepts

it.

CONCLUSION

Because the Registrar has accepted the administrative law judge’s decision, that decision is the

final administrative decision in this case and becomes effective on April 9, 2019.

Dated February 28, 2019.

Registrar of Contractors

/s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal Department and Recovery Fund

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 Copy mailed via USPS First Class mail February 28, 2019 to: Respondent Stephen Bart Benge DBA: Stephen Bart Benge Construction 575 N Sarnoff Dr Tucson, AZ 85710 John Christiansen, Esq. KING & FRISCH PC 6226 E Pima St Ste 150 Tucson, AZ 85712 Complainant Barcelo Electric LLC 6707 S Placita Segovia Tucson, AZ 85757 AND copy electronically mailed this same date to:

Respondent at email address on record with the Registrar Respondent’s Attorney at email address of record with Registrar Complainant at email address on record with the Registrar

Office of Administrative Hearings Jenna Clark, Administrative Law Judge Case No. 2018-3938 / AN

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 RECEIVED 2.11.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Barcelo Electric LLC, No. 2018A-3938-ROC COMPLAINANT, ADMINISTRATIVE LAW JUDGE v. DECISION Stephen Bart Benge, dba Stephen Bart Benge Construction, License No. ROC 256398, RESPONDENT. HEARING: January 28, 2019 at 8:30 AM. APPEARANCES: Pedro Barcelo appeared on behalf of Barcelo Electric LLC (“Complainant”). John Christiansen, Esq. appeared on behalf of Stephen Bart Benge Construction (“Respondent”) with Stephen Benge as a witness. ADMINISTRATIVE LAW JUDGE: Jenna Clark. _____________________________________________________________________ After review of the hearing record in this matter, the undersigned Administrative

Law Judge makes the following Findings of Fact and Conclusions of Law, and issues

this Recommended Order to the Director of the Arizona Registrar of Contractors

(“ROC”).

FINDINGS OF FACT

BACKGROUND AND PROCEDURE

1. According to the ROC’s public website, on or about July 13, 2009, the

ROC issued License No. 256398, B general residential contracting license, to

Respondent.1 Stephen Bart Benge is the Qualifying Party on this license. Respondent’s address of record on the license is 575 N. Sarnoff Dr. Tucson, AZ 85710-2557.2 2. Pursuant to ARIZ. ADMIN. CODE R4-9-117, Administrative Notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website on January 28, 2019. License No. 256398 is current and renewed through July 31, 2019. See https://roc.az.gov/contractor-search?Id=a0Yt000000ACTrcEAH. Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 2.11.2019 ROC LEGAL

There are no open complaints against the license, or record of prior discipline that has been taken against the license. The license has an active $9,000.00 surety bond through Merchants Bonding Co. effective May 03, 2014.3

3. On August 21, 2018, Complainant filed a NON-PAYMENT COMPLAINT FORM

with the ROC.4

4. On August 27, 2018, the ROC notified Respondent of the filed complaint

via email and postal mail.5

5. On September 11, 2018, the ROC issued Respondent a CITATION FOR

ALLEGED VIOLATION OF ARIZ. REV. STAT. § 32-1154(A)(10). The written complaint

charged Respondent with the commission of an act or acts that would, if proved, be

cause for the suspension or revocation of Respondent’s license under ARIZ. REV. STAT.

§ 32-1154(A)(10). Respondent was required to provide a written ANSWER per ARIZ. REV.

STAT. § 32-1155(A) by September 26, 2018.6

6. On September 09, 2018, the ROC received an electronic correspondence

titled ANSWER TO COMPLAINT from Respondent.7 In its ANSWER, Respondent

acknowledged that Complainant had issued four invoices for the underlying project.

Regarding Invoice 15, Respondent argued that Complainant was paid $2,000.00 on December 08, 2015, per their contract. Respondent denied authorizing additional items on the invoice. Regarding Invoice 246, Respondent argued that Complainant was paid $8,958.00 because Complainant had abandoned the project and Respondent had hired another subcontractor to finish the electrical work on the job. Regarding Invoices 293 and 311, Respondent argued that the items on the invoices had never been authorized by Respondent.

Id. Id. See the Registrar’s electronic file at page 53. See the Registrar’s electronic file at page 56. Id. 7 See the Registrar’s electronic file at page 30. RECEIVED 2.11.2019 ROC LEGAL

7. On November 29, 2018, the ROC issued a NOTICE OF HEARING upon the charges made in the CITATION and COMPLAINT to the parties, for hearing at 8:30 a.m. on January 28, 2019, at the Office of Administrative Hearings.8

HEARING EVIDENCE

8. Pedro Barcelo testified on behalf of Complainant. Stephen Benge testified

on behalf of Respondent and submitted three exhibits. The ROC’s electronic file and

NOTICE OF HEARING were also admitted into the evidentiary record.

Mr. Barcelo’s testimony

9. Mr. Barcelo testified that his company was hired by Respondent as the electrical subcontractor for the underlying project at issue. Mr. Barcelo testified that the parties executed a contract agreement for $12,916.00, but could not provide the date the contract was signed. Per Mr. Barcelo, Respondent was to pay half of the agreed on amount at the onset of the project, half of the balance when the rough end was completed, and the remaining balance when the trim was finished. 10. Mr. Barcelo agreed that Complainant received $3,000.00 on May 31, 2017, $3,458.00 on June 10, 2017, and $2,500.00 on December 19, 2017, from Respondent as contracted9, but argued that Respondent failed to compensate Complainant for “extras” on the job. 11. Mr. Barcelo testified that Complainant issued four invoices to Respondent

for the underlying project.

12. Per Mr. Barcelo, Complainant issued Invoice 15 to Respondent on

November 17, 2015, for $5,025.00.10 Payment was due December 17, 2015.11 Mr. Barcelo testified that Respondent owed an outstanding balance of $3,025.00 on the invoice, but further testified that he was aware the dispute regarding Invoice 15 was outside of the ROC’s statute of limitations pursuant to ARIZ. REV. STAT. § 32-1155.

See the NOTICE OF HEARING. See Respondent Exhibit 2. See the Registrar’s electronic file at page 85. 11 Id. RECEIVED 2.11.2019 ROC LEGAL

13. Per Mr. Barcelo, Complainant issued Invoice 246 to Respondent on June 06, 2017, for $15,286.00.12 Payment was due July 06, 2017.13 Mr. Barcelo testified that Complainant received an $8,958.00 payment from Respondent, resulting in an outstanding balance of $6,328.00. 14. Mr. Barcelo agreed that Invoice 293 was not a part of Complainant’s original contract with Respondent, and that no Change Order had been effectuated for the itemized materials/labor detailed in the invoice. Mr. Barcelo testified that he received a verbal authorization from Mr. Benge for the work. Per Mr. Barcelo, Complainant issued Invoice 293 to Respondent on October 07, 2017, for $1,814.00.14 Payment was due November 07, 2017.15 Mr. Barcelo testified that Respondent instructed him to give the invoice to Mr. Benge, who would pass the invoice along to the homeowner on the project, but that Complainant never received payment for Invoice 293.

15. Mr. Barcelo agreed that Invoice 311 was not a part of Complainant’s

original contract with Respondent, and that no Change Order had been effectuated for

the itemized materials/labor detailed in the invoice. Mr. Barcelo testified that he

received a verbal authorization from Mr. Benge for the work. Per Mr. Barcelo, Complainant issued Invoice 311 to Respondent on December 08, 2017, for $385.00.16 Payment was due January 08, 2018.17 Mr. Barcelo testified that no payment was received for Invoice 311. 16. Mr. Barcelo denied that Complainant had ever abandoned the underlying project, and also denied having an arrangement for extras with the homeowner outside the scope of its contract with Respondent. Mr. Benge’s testimony

See the Registrar’s electronic file at page 86. Id. See the Registrar’s electronic file at page 87. Id. See the Registrar’s electronic file at page 88. 17 Id. RECEIVED 2.11.2019 ROC LEGAL

17. Mr. Benge testified that the underlying project, located at 11028 E. Deer Tank Pl. Tucson, AZ 85749, was a remodeling of a private residence including the master bedroom, an add-on room, and a kitchen renovation. 18. Per Mr. Benge, the parties entered into a contractual agreement for $12,916.00 whereby Complainant would perform electrical work for Respondent on a job.18 Complainant agreed to bill Respondent throughout the project via invoice. Payment was due within thirty days of receipt. Mr. Benge further testified that all extra work performed on the job was supposed to be approved by Homeowner and authorized by Respondent, but that Homeowner and Complainant entered into their own agreement regarding extra work outside of Respondent’s agreement with Complainant. 19. Regarding Invoice 246, Mr. Benge testified that five additional items appeared on the invoice that Complainant and Homeowner independently agreed to.

20. Regarding Invoices 293 and 311, Mr. Benge testified that Respondent

had not approved any of the items listed, and that Homeowner and Complainant had

independently agreed to the work outside of Respondent’s presence.

21. Mr. Benge testified that Complainant had asked him to deliver several invoices to Homeowner, and that he had agreed to do so and collect any monies remitted and deliver them to Complainant. As an example, Mr. Benge offered check number 133 from Homeowner dated September 06, 2017, for $1,475.00, into the record, which Mr. Benge testified he obtained from Homeowner and delivered to Complainant.19 22. Per Mr. Benge, Mr. Barcelo became upset when Homeowner stopped making payments on the extra work Complainant performed, so Complainant informed Respondent that it would not return to the project until it received payment in full for all outstanding invoices. Mr. Benge testified that he informed Mr. Barcelo that Respondent

See the Registrar’s electronic file at pages 30-35. 19 See Respondent Exhibit 1. RECEIVED 2.11.2019 ROC LEGAL

was not responsible for Homeowner’s obligations toward Complainant as their agreement was independent and outside the scope of Respondent’s agreement with Complainant. 23. Mr. Benge testified that he warned Mr. Barcelo he would hire another subcontractor to replace Complainant if Complainant did not return to work on the project. 24. Per Mr. Benge, when Complainant maintained its refusal to complete the project, Respondent hired another electric subcontractor to finish the project. In total, Respondent paid the new subcontractor $3,325.00 to finish the electrical work on the project20, which, per Mr. Benge, would have gone to Mr. Barcelo if Complainant had returned to the project and completed the work as contracted. 25. Mr. Benge testified that, as of the date of the hearing, the project remained to be completed. A new subcontractor had to be hired to address the punch

list on the project, and the project itself still needs to pass the city’s code inspection.

26. Mr. Benge denied failing to return Mr. Barcelo’s text messages, and

argued that he had telephoned Mr. Barcelo instead of texting because it was easier for

him. CONCLUSIONS OF LAW 1. The ROC has jurisdiction over this matter pursuant to ARIZ. REV. STAT. §§ 32-1101 et seq. and 32-1154(A). The purpose of the ROC’s licensing statutes is to

protect the public from unscrupulous, unqualified, and financially irresponsible

contractors.21

2. Complainant bears the burden of proof to establish Respondent’s

statutory violation by a preponderance of the evidence.22 Respondent bears the

See Respondent Exhibit 3. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995). See ARIZ. REV. STAT. § 41-1092.07(G)(2); ARIZ. ADMIN. CODE R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). RECEIVED 2.11.2019 ROC LEGAL

burden to establish factors in mitigation of the penalty and affirmative defenses by the same evidentiary standard.23 3. “A preponderance of the evidence is such proof as convinces the trier of

fact that the contention is more probably true than not.”24 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.”25

4. ARIZ. REV. STAT. § 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.

5. ARIZ. REV. STAT. § 32-1155(A) holds, in pertinent part, as follows: On the filing of a written complaint with the registrar charging a licensee with the commission, within two years before the date of filing the complaint, of an act that is cause for suspension or revocation of a license . . . the registrar after investigation, in its sole discretion, may issue a citation directing the licensee, within ten days after service of the citation on the licensee, to appear by filing with the registrar the licensee's written answer to the citation and complaint showing cause, if any, why the licensee's license should not be suspended or revoked.

23 See ARIZ. ADMIN. CODE R2-19-119(B)(2). MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960). See also BLACK’S LAW DICTIONARY 1373 (10th ed. 2014) which states that 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.” 25 BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999). RECEIVED 2.11.2019 ROC LEGAL

6. “Statutes should be interpreted to provide a fair and sensible result.”26 7. “Statutes shall be liberally construed to affect their objects and to promote justice.”27

8. In the present case, it is undisputed that Complainant’s first allegation of

wrongdoing, from December of 2015, falls outside the statute of limitations pursuant to

ARIZ. REV. STAT. § 32-1155(A) as the underlying complaint with the ROC was filed on

August 21, 2018. As such, the complaint is time-barred and will not be discussed

further.

9. Regarding the remaining three allegations of wrongdoing levied against

Respondent by Complainant, the preponderance of the evidence shows that no

violation of ARIZ. REV. STAT. § 32-1154(A)(10) exists as Complainant failed to provided

sufficient evidence to establish that Respondent agreed to be financially responsible for

the extras Complainant invoiced. It is more likely than not that Complainant entered into

an agreement for extras with Homeowner, and that Complainant failed to complete the

project when Homeowner failed to make payment(s) on Complainant’s invoices.

10. Moreover, the record reflects that Complainant received compensation

from Respondent on the work it completed on the project, per contract, up and until Complaint ceased work on the job. 11. Based on the relevant and credible evidence in the record, it is inappropriate for the ROC to discipline Respondent’s license in any fashion under ARIZ. REV. STAT. § 32-1154(A)(10). RECOMMENDED ORDER Based on the foregoing findings of fact and conclusions of law, IT IS RECOMMENDED that Complainant Barcelo Electric LLC’s appeal shall be dismissed.

See 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.”). 27 See ARIZ. REV. STAT. § 1-211(B). RECEIVED 2.11.2019 ROC LEGAL

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, February 11, 2019.

/s/ Jenna Clark Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors