ALJDEC decisions subject to certification as final

2019A-02237-NPC-ROC · Registrar of Contractors · 2019-08-12

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 23, 2019 APPEARANCES: Complainant Ronald Leonard Harlin appeared on his own behalf. Enrique Venegas, Owner and Qualifying Party, appeared on behalf of Respondent Elidas Residential Contracting LLC. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ FINDINGS OF FACT 1. Elidas Residential Contracting LLC (Respondent) is the holder of License Nos. 323400 and 320845 issued by the Registrar of Contractors (Registrar). 2. On or about April 30, 2019, Ronald Leonard Harlin, doing business as Brother for Life Plumbing (Complainant) filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the sum of $14,700.00 for plumbing work performed by Complainant. 3. The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a Citation for Alleged Violation of A.R.S. § 32-1154(A)(10). 4. Complainant testified that the total due to Complainant was $14,700.00. Complainant identified two separate contracts under which he believed he was owed. The first contract was the Student Choice High School with a total contract amount of $5,200.00 and payments of $4,100.00, leaving a balance of $1,100.00. However, upon questioning, Complainant acknowledged that the last payment of $1,100.00 was due upon completion of the job and Complainant did not complete the job. 5. The second contract was the Lomi Poki with an initial contract amount of $15,000.00, change orders of $6,600.00, and payments of $8,000.00, leaving a balance of $13,600.00. Under the terms of the Lomi Poki contract, the first payment of $5,000.00 was due when the work under the contract began; a second payment of $6,000.00 was due “upon completion of work and passes inspection”; and the final payment of $4,000.00 was due “[a]fter trim is complete and all TOILETS, URINAL, ETC has been installed.” 6. Complainant did not have any written change orders to support his asserted increase of $6,400.00 in the contract price. Respondent acknowledged a $2,100.00 change order to move the grease trap, but denied any other change orders. 7. On April 4, 2019, Complainant notified Respondent that he would “make inspections on Tuesday[, April 9, 2019].” Inspections were called on April 8, 2019, and April 12, 2019. The plumbing failed both inspections. 8. On April 15, 2019, Respondent terminated Complainant’s contract with Respondent on the Lomi Poki project due to numerous issues on the project. 9. Respondent hired another plumbing contractor to correct Complainant’s work and complete the project and paid that contractor $8,350.00. 10. Complainant testified that all the work on the Lomi Poki project was complete and he was just waiting to complete the trim work. 11. Respondent did not assert that it lacked the capacity to pay the amount Complainant asserted was due. 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 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.

4. The evidence did not establish that Respondent owed Complainant any monies under the contract. A contract is not a guarantee of payment absent the work being performed. Complainant acknowledged that he did not perform the trim work on the Student Choice High School project; therefore, Complainant was not entitled to the $1,100.00 final payment. 5. Complainant also failed to establish that he had passed inspections on the Lomi Poki project that would entitle him to the second or final payment under that contract. 6. Therefore, Complainant failed to establish that Respondent violated A.R.S. § 32-1154(A)(10) by failing to pay Complainant $14,700.00 for services or materials rendered in connection with Respondent’s contracting business. RECOMMENDed order It is recommended that on the effective date of the Registrar’s final order in this matter, the Registrar close Complainant’s complaint against Respondent’s licenses based on Complainant’s failure to prove a violation of A.R.S. § 32-1154(A)(10). 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, August 12, 2019. /s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors -----------------------

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