ALJDEC decisions subject to certification as final

2019A-02165-ROC · Registrar of Contractors · 2019-10-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 26, 2019 APPEARANCES: Michael Raine, Assistant Attorney General, appeared on behalf of Complainant. David Abadi, appeared telephonically, on behalf of Respondent, David Electric. ADMINISTRATIVE LAW JUDGE: Antara Nath Rivera _____________________________________________________________________ FINDINGS OF FACT Background and Procedure 1. On April 24, 2019, at 7:34 a.m., an anonymous person filed a hotline complaint with the Registrar of Contractors (Registrar) that David Electric (Respondent) was operating an electrical business and claiming to be a licensed contractor on Facebook and Riverdavesplace.com. The hotline tip indicated an address of 55 Lake Havasu Avenue, 1249, Lake Havasu City, AZ 86403. 2. In the complaint, there were screenshots of Respondent’s advertisements. 3. The complaint was assigned to the Registrar’s Investigator, Bob McQuien (Investigator McQuien), for investigation. 4. On April 30, 2019, Investigator McQuien issued a Cease & Desist Order and a civil citation for violating A.R.S. § 32-1165, based on Respondent’s purported internet advertisements, and assessed a civil penalty in the amount of $1,000.00 for the violation. 5. Respondent accepted personal service of the Cease & Desist Order and civil citation at Respondent’s address at 1940 Burgundy, Lake Havasu City, Arizona 86404. 6. On or about May 20, 2019, Respondent requested a formal hearing. The Registrar referred the matter to the Office of Administrative Hearings (OAH), an independent state agency, for an evidentiary hearing. 7. A hearing was held on September 26, 2019. The Registrar submitted six exhibits and presented Investigator McQuien’s testimony. Additional Hearing Evidence 8. Investigator McQuien identified the internet advertisements that were submitted with the hotline complaint. The advertisements from Facebook showed Respondent’s name, the location the advertisements intended to reach, and the service. Respondent advertised a myriad of electrical services for the Lake Havasu and Parker area. The advertisement from riverdavesplace.com included a picture of a male, with his back to the picture, wearing a shirt with an advertisement on the back of the shirt. The advertisement indicated Respondent’s business name, phone number, and the words “commercial residential” and “[o]n time every time.” The advertisement included a license number of 886039. Further investigation revealed that the respective license number belonged to Respondent but was an active license from California, not Arizona. Investigator McQuien had no knowledge when or where the picture was taken or by whom. None of the advertisements included the disclaimer, “Not a Licensed Contractor.” 9. Investigator McQuien went to the address listed in the hotline and spoke to the homeowner. The homeowner, a friend of David Charles Abadi (Mr. Abadi), owner of Respondent, initially informed Investigator McQuien that he did not want to speak with Investigator McQuien. However, later he told Investigator McQuien that Respondent performed electrical work at his home at no charge. 10. A conversation with Mr. Abadi revealed that Mr. Abadi applied for his Arizona license through the Registrar, but failed the business law portion of the exam. Respondent stated that he was waiting to retake the exam and reapply. 11. Investigator McQuien issued a fine of $1,000.00. This was a standard fine that was issued for this type of violation. Moreover, Investigator McQuien believed that because Respondent was a licensed electrician in California, Respondent should have known the penalties for advertising without a license. Pending a receipt of a license, this fine can be reduced. 12. At hearing, Mr. Abadi, testified on behalf of Respondent. Mr. Abadi acknowledged the Facebook advertisements but had no knowledge of the riverdavesplace.com advertisement. Mr. Abadi hired someone to help him advertise his business, on Facebook only, once he received his license. The Facebook page advertisement was supposed to be emailed to him, at his personal email address, for his review and approval. Instead, it was accidentally published on the Facebook page. Mr. Abadi had no intentions of advertising his business as he did not have a license. 13. Mr. Abadi had no knowledge of the published picture on the riverdavesplace.com advertisement. Mr. Abadi did not know who took the picture or posted the picture and opined that the person who posted it may have published it because of jealousy. 14. Mr. Abadi acknowledged that he did not have a license in Arizona but did have a California license. He indicated that the job he did for his friend was related to installing a plug that was a 30 minute job and cost much less than $500.00. He stated that the job technically would have fallen under the handyman exception if he charged his friend. Mr. Abadi’s license application was still pending at the Registrar. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction.[1] 2. The Registrar bears the burden of proof to establish Respondent’s statutory violation by a preponderance of the evidence.[2] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[3] 3. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[4] 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.”[5] 4. A.R.S. § 32-1165 provides as follows: Except as authorized by section 32-1121, subsection A, paragraph 14, subdivision (c), it is a class 1 misdemeanor for any person to advertise that he is able to perform any service or contract for compensation subject to regulation by the registrar under the terms of this chapter unless a license under the terms of this chapter is first obtained regardless of whether his operations as a contractor are otherwise exempt.

5. The Registrar established that the internet advertisements that it attributed to Respondent did not include the disclaimer, “Not a Licensed Contractor.” Further, the Registrar established that Respondent did not have an Arizona license through the Registrar. 6. While Respondent acknowledged that he was not licensed in Arizona, he explained that the Facebook advertisements were published without his permission. The advertisements were for his review only and meant to be published once he obtained his license. However, the Facebook advertisements were not immediately removed upon notice of this error. 7. A.R.S. § 32-1166(A) authorizes the Registrar to assess “a civil penalty in an amount of at least two hundred dollars for each violation but not more than two thousand five hundred dollars for the multiple violations committed on the same day.” A.R.S. § 32-1166(A) also authorizes the Registrar to assess a civil penalty against a person who has been found to have advertised that he is able to perform a service for which a contractor’s license is required in violation of A.R.S. § 32-1165. 8. The Registrar found that Respondent violated Arizona contracting laws with the Facebook advertisement and riverdavesplace.com advertisement. Thus, Respondent was assessed civil penalty of $1,000.00. Based on the specific and unique circumstances in this matter, the Tribunal concludes that that Respondent violated Arizona contracting laws with the Facebook advertisements but not the riverdavesplace.com advertisement. Thus, a civil penalty of $500.00 is warranted in this case. RECOMMENDED ORDER Based upon the foregoing, it is recommended that the Registrar affirm the finding that Respondent violated A.R.S. § 32-1165, reverse the decision to assess a civil penalty in the amount of $1,000.00, and assess a civil penalty of $200.00 to be paid in certified funds to the Registrar on or before the effective date of the Registrar’s final Order in this matter. 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, September 26, 2019.

/s/ Antara Nath Rivera Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors

----------------------- [1] See A.R.S. § 32-1101 et seq. [2] See A.R.S. § 41-1092.07(G)(3); A.A.C. R2-19-119(A) and A.A.C. R2-19- 119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [3] See A.A.C. R2-19-119(B)(2). [4] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [5] Black’s Law Dictionary 1220 (8th ed. 1999).

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