ALJDEC decisions subject to certification as final

2019A-02521-CHC-ROC · Registrar of Contractors · 2019-08-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 9, 2019, at 1:00 p.m. APPEARANCES: SVAZ LLC, DBA Mr. Fix It of Sierra Vista (“Complainant”) appeared through Alfred Dean Nash, its Qualifying Party; Elite Granite Fabrication LLC (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT 1. On June 6, 2014, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC 292330 for Specialty Dual CR-60 Finish Carpentry to Respondent. Respondent’s address of record is 4750 N. Barghout Pl., Tucson, Arizona 85745-9424. 2. On August 29, 2017, the Registrar issued License Nos. ROC 315573 for General Dual KB-2 Dual Residential and Small Commercial contracting and ROC 315574 for Specialty Dual CR-11 Electrical to Complainant. On September 7, 2017, the Registrar issued License No. ROC 315572 for Specialty Dual CR-37 Plumbing to Complainant. 3. On May 14, 2019, Complainant filed a complaint against Respondent with the Registrar, alleging that it had failed to install granite side splashes on Complainant’s customer’s refrigerator cabinet and that it had requested and been paid $1,000.00 more than the contract amount by Complainant’s customer, despite the job being incomplete, on a job at 9701 S. Trails End Place, Hereford, Arizona 85615.[1] According to the complaint, the contract amount was $10,181.20 and Respondent had been paid $11,181.20.[2] 4. Complainant attached to its complaint its contract with Respondent for granite work at Complainant’s customer Anna Hammond’s house in the amount of $10,181.20, payable one-half down to start, and Complainant’s check made payable to Respondent dated February 8, 2019, in the amount of $5,090.60. Respondent had endorsed and cashed the check. 5. On May 28, 2019, Complainant provided to the Registrar copies of checks made payable to Respondent by Complainant’s customer Anna Hammond dated April 16, 2019, in the amount of $3,045.30 and dated April 18, 2019, in the amount of $3,045.30. Respondent had endorsed and deposited both checks.[3] 6. The complaint was assigned to the Registrar’s Investigator Gregory Johndrow. On May 31, 2019, Investigator Johndrow performed a jobsite inspection. On May 31, 2019, Investigator Johndrow on behalf of the Registrar issued a Directive to Respondent, requiring it take appropriate corrective action to correct the two items on Complainant’s complaint on or about June 17, 2019, in relevant part as follows: Complaint Item 2: "Granite side splashes not completed on refrigerator cabinet"

Complaint Item 4: "Final payment was requested from the customer prior to project being completed, Amount requested / paid by customer was higher than initial contract amount due to "additional work"[4]

7. After Respondent failed to take any action to comply with the Directive, Investigator Johndrow referred the complaint to the Registrar’s Legal Department. 8. On June 18, 2019, the Registrar issued a Citation that charged cause to revoke or suspend Respondent’s contractor’s license under A.R.S. § 32-1154(A)(1), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, A.R.S. § 32-1154(A)(8), and A.R.S. § 32-1154(A)(22).[5] The Registrar sent the citation to Respondent by certified mail to its address of record. 9. Respondent filed a timely written answer to the Citation, denying any statutory violations. 10. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing. On July 3, 2019, the Registrar issued a Notice of Hearing, setting an evidentiary hearing on August 9, 2019, at 1:00 p.m. in the Registrar’s Tucson office. The Registrar mailed the notice of hearing to Respondent at its address of record. 11. A videoconference hearing was held on August 9, 2019. Complainant’s qualifying party Alfred Dean Nash testified consistently with the complaint and documents that Complainant had provided to the Registrar. Investigator Johndrow testified consistently with his jobsite inspection notes and the Directive. 12. Respondent did not request to appear telephonically and did not appear at the hearing, through an authorized member, employee, or attorney, although the hearing did not begin until ten minutes after the time on the Notice of Hearing. Consequently, Respondent did not present any evidence to defend its license. 13. Investigator Johndrow testified that he performed a prehearing jobsite inspection on August 8, 2019, and that there was no change in the status of the job. Respondent did not attend the May 31, 2019 jobsite inspection or the August 8, 2019 prehearing inspection. To date, Investigator Johndrow had not received any correspondence from Respondent. 14. Mr. Nash explained that Complainant’s customer’s countertop was broken and needed to be replaced and Complainant subcontracted this work to Respondent. Mr. Nash testified that Respondent had not issued and Complainant had not agreed to any change orders that raised the cost of the project. Respondent had been short of materials on the job and had promised would return to install the side splashes and seal the countertops. After Respondent was paid in full, plus $1,000.00, it had not returned to the job or completed the work. 15. Mr. Nash testified that Respondent asked for the final payment so that it could purchase remaining materials. Because Complainant’s bookkeeper was not available, the homeowner offered to pay the balance due under the contract to get the work completed. Respondent informed the homeowner that the balance due was $1,000.00 more than Complainant actually owed on the contract and Complainant’s customer issued a check in the amount it misrepresented was due. 16. Mr. Nash testified that although Respondent has been paid $1,000.00 more than the contract amount, he has not heard anything from Respondent. The project is still incomplete. Respondent has not returned any money to Complainant or Ms. Hammond. 17. Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s disciplinary history as shown on the Registrar’s website on this date. Respondent’s license is suspended, it has cancelled its bond, its license has been disciplined once, and three complaints, including Complainant’s, are pending against the license. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction.[6] 2. The Notice of Hearing that the Registrar sent to Respondent at its address of record was reasonable and Respondent is deemed to have received notice of the hearing.[7] 3. The suspended status of Respondent’s license does not deprive Complainant of its ability to prosecute its complaint or prevent the Registrar from determining the merits of Complainant’s complaint.[8] 4. Complainant bears the burden to establish grounds for suspension or revocation of Respondent’s contractor’s license by a preponderance of the evidence.[9] Respondent bears the burden to establish affirmative defenses and factors in mitigation of the penalty by the same evidentiary standard.[10] 5. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[11] 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.”[12] 6. A.R.S. § 32-1154(A)(1) includes among the grounds to suspend or revoke a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” Complainant established that Respondent failed to perform any work to complete the project after it received the customer’s second payment. Complainant therefore established grounds to suspend or revoke Respondent’s contractor’s licenses under A.R.S. § 32-1154(A)(1). 7. A.R.S. § 32-1154(A)(3) includes among the grounds to suspend or revoke a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” A.A.C. R4-9-108(A) states that “[a] contractor shall perform all work in a professional and workmanlike manner.” A.A.C. R4-9-108(B) states, in pertinent part, that “[a] contractor shall perform all work in accordance with any applicable building codes and professional industry standards.” Complainant established that Respondent performed poor work on Ms. Hammond’s project by failing to complete it after it was paid more than was due for the job. Complainant therefore established grounds to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3) and A.A.C. R4-9-108. 8. A.R.S. § 32-1154(A)(8) includes among the grounds to suspend or revoke a contractor’s license “[f]ailure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract.” Complainant established that Respondent demanded and received $1,000.00 more than the contract amount based on its empty promise to the homeowner that it would complete the job. Complainant therefore established grounds to suspend or revoke Respondent’s contractor’s licensed under A.R.S. § 32-1154(A)(8). 9. A.R.S. § 32-1154(A)(22) includes among the grounds to suspend or revoke a contractor’s license “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.” Complainant established that Respondent failed to comply with the May 31, 2019 Directive, thereby furnishing additional grounds to suspend or revoke Respondent’s license. 10. With respect to the penalty, Respondent’s suspended license and misrepresentation about the amount due under the contract to Complainant’s customer, who was trying to accommodate Respondent, and failure to attend the duly noticed hearing indicate that, at this time, Respondent cannot be regulated. RECOMMENDED ORDER In light of the foregoing facts and conclusions of law, IT IS ORDERED that on the effective date of the final order in this matter, Respondent Elite Granite Fabrication LLC’s License No. ROC 292330 shall be revoked. IT IS FURTHER ORDERED that Respondent shall pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(E). IT IS FURTHER ORDERED that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the final Order, Respondent’s license shall be revoked, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty. 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, August 26, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] Complainant later corrected the address to 9701 S. Trails End Place, Hereford, Arizona 85615. See the Registrar’s electronic file at pdf page 16. [2] See the Registrar’s electronic file at pdf pages 39-42. [3] See the Registrar’s electronic file at pdf pages 17-21. [4] The Registrar’s electronic file at pdf page 22. [5] See the Registrar’s electronic file at pdf pages 5-11. [6] See A.R.S. § 32-1154(A). [7] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [8] See A.R.S. § 32-1154(D). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such licensee, or to render a decision suspending or revoking such a license . . . .” [9] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [10] See A.A.C. R2-19-119(B)(2). [11] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [12] Black’s Law Dictionary at 1220 (8th ed. 1999).

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