ALJDEC decisions subject to certification as final

2019A-05956-NPC-ROC · Registrar of Contractors · 2020-03-12

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Brandon Laird Moffett,

COMPLAINANT,

v.

Seal West Paving and Sealcoating LLC,

ROC License: ROC 304451

RESPONDENT.

No. 2019A-05956-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 12, 2020 at 9:00 AM.

APPEARANCES: Brandon Laird Moffett (“Complainant”) appeared on his own behalf. No appearance(s) by or on behalf of Seal West Paving and Sealcoating LLC (“Respondent”).

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 Registrar.

FINDINGS OF FACT

Background and Procedure

On June 22, 2016, the Registrar issued ROC License No. 304451 for Specialty Dual CR-69 Asphalt Paving contracting to Respondent. Jana Lynn Harris listed on the license as the Qualifying Party and Member. The address of record for the license is 4429 N 23rd Pl., Phoenix, Arizona 85016-5516.

Pursuant to Arizona Administrative Code (“Ariz. Admin. Code”) R4-9-117, Administrative Notice is taken of Respondent’s license files as shown on the Registrar’s public website March 12, 2020. Regarding ROC License No. 304451, such prior license record reflects that Respondent’s license was suspended effective March 06, 2020, for lack of bond. Respondent’s $6,750.00 surety bond for the license, as originally issued by American Contractors Indemnity Company on February 19, 2016, was cancelled on March 05, 2020. The license has not been previously disciplined, however, the record reflects that two prior cases have been resolved or otherwise settled with the license. The record also reflects that there is one open complaint against the license, which is presumed to be related to this matter.

On December 03, 2019, the Registrar received a complaint from Complainant alleging nonpayment of services against Respondent. The Registrar designated it Complaint No. 2019-05956 and assigned the case to Tedi While in their legal department for investigation.

On December 06, 2019, the Registrar issued a Notice of No Pay Complaint letter to Respondent providing notice of Complaint No. 2019-05956, and informed Respondent that it was free to raise any affirmative defense(s) or provide additional information by December 13, 2019.

On December 11, 2019, and December 12, 2019, the Registrar received letters from Respondent which alleged, in pertinent parts, that Complainant had combined two independent projects into one complaint; rendering one invalid because the outstanding amount owed was less than $750.00, and that Complainant had received payment for the other complaint. Specifically, Respondent alleged that Complainant had been hired to perform work on two separate project sites, Vallejo Dental and 2nd Street Plaza. Per Respondent admitted that Complainant was owed $250.00 for the Vallejo Dental project, but argued that because the amount owed was less than $750.00 the Registrar did not have jurisdiction under Arizona Revised Statute (“Ariz. Rev. Stat.”) § 32-1154(A)(10) to discipline Respondent. Respondent further argued that 2nd Street Plaza project was not finished, and noted that Complainant would receive payment for the job after the project owner issued payment to Respondent. Respondent also accused Complainant of “holding a check" and delaying payment.

On December 18, 2019, the Registrar issued a Citation to Respondent for an alleged violation of Ariz. Rev. Stat § 32-1154(A)(10). Respondent was notified that a failure to provide an Answer by January 02, 2020, would be deemed as an admission of Respondent’s commission of the act(s) charged in the underlying complaint, pursuant to Ariz. Rev. Stat § 32-1155(B), and could result in discipline against Respondent’s license including suspension or revocation.

On January 01, 2020, the Registrar received Respondent’s Answer. In its Answer Respondent alleged that Complainant received a $1,500.00 down payment for the 2nd Street Plaza project, and that Respondent “signed over” a check to Complainant “for the balance owed on a project that is not complete.” Respondent alleged that Complainant’s refused to return the check and re-issue payment resulted in the delay of Complainant’s payment. Respondent requested that the Registrar dismiss Complaint No. 2019-05956, or alternatively, schedule a Settlement Conference.

On January 17, 2020, the Registrar issued an Order Denying Request to Dismiss to Respondent.

On January 24, 2020, the Registrar issued a Notice of Informal Settlement Conference to the parties.

On January 27, 2020, this matter was referred to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on February 05, 2020. Per the Notice of Hearing, the issue to be determined is whether the Registrar has cause to discipline Respondent’s license based on the following charge(s) alleged in the Citation and Complaint:

Charge 1: A violation of A.R.S. § 32-1154(A)(10).

Hearing Evidence

Complainant testified on his own behalf and submitted one exhibit.

Complainant’s Case-in-Chief

Complainant was issued ROC License No. 322619 by the Registrar on November 15, 2018.

Complainant and Respondent had not previously conducted business with each other prior to entering into the underling contracts at issue.

On October 26, 2019, entered into a contractual agreement whereby Respondent agreed to pay $4,750.00, less a $1,500.00 deposit, to Complainant for striping and seal work at two separate project sites. Specifically, Complainant was hired to perform striping work on the Vallejo Dental project, and seal and striping work at the 2nd Street Plaza project. Work on the projects commenced October 26, 2019.

On 26, 2019, Complainant completed work on the Vallejo Dental project.

On October 31, 2019, Complainant completed work on the 2nd Street Plaza project.

On October 31, 2019, Complainant issued Invoice 2019-059 to Respondent for $3,250.00 via certified mail. Complainant’s correspondence was returned as undeliverable. As a result, Complainant hand delivered Invoice 2019-059 to Hayden Harris, Respondent’s Project Manager, on or about November 20, 2019.

On or about November 20, 2019, Respondent signed-over Check No. 6765 in the amount of $3,000.00 from Spires Investments to Complainant. Complainant was unable to cash or deposit the check because it had not been made out to him or his business.

Complainant and Respondent had multiple discussions about the outstanding debt owed to Complaint, but could not resolve their dispute.

On December 01, 2019, Complainant submitted Complaint No. 2019-05956 to the Registrar.

On January 29, 2020, Complainant received a $3,000.00 payment from Respondent.

On February 13, 2020, the parties participated in an Informal Settlement Conference, but were unable to resolve their dispute.

On March 11, 2020, Complainant received a $250.00 payment from Respondent.

At the hearing, Complainant admitted that the original outstanding amount of the parties’ contract had been paid in full by Respondent, but argued that Respondent owed $2,210.00 in late fees. Complainant further argued that grounds existed for the Registrar to discipline Respondent’s license based on Complaint No. 2019-05956.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction and has been properly brought before OAH for adjudication.

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors.

The Registrar may resolve contractual disputes if such resolution in ancillary to its regulatory mission and may penalize a contractor’s license by ordering payment of restitution if a proven statutory violation was not remedied by corrective action.

The Notice of Hearing the Registrar mailed to Respondent’s address of record is sufficient, and Respondent is deemed to have received notice of the hearing in this matter. Because the Registrar mailed all correspondence to Respondent in the same manner and failed to receive any mail returned as undeliverable, Respondent is deemed to have received all correspondence regarding this matter from the Registrar as well.

Unless otherwise provided by law, a party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” 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.”

Statutes should be interpreted to provide a fair and sensible result. Statutes shall be liberally construed to affect their objects and to promote justice.

Ariz. Rev. Stat. § 32-1154(A)(10) holds, in pertinent part, that among the grounds for suspension or revocation of a contractor’s license is a “[f]ailure by [the] 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, 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.”

The following material facts are not in dispute.

Here, it is undisputed that the parties entered into a $4,750.00 contractual agreement, less a $1,500.00 deposit, for Complainant to provide materials and perform work. It is also undisputed that Complainant provided materials and performed work as contracted. It is further undisputed that Respondent remitted payment for Invoice 2019-059 on January 29, 2020, and March 11, 2020, which was no less than 100 days after the outstanding balance was due.

Therefore, the only issue remaining is whether Respondent raised a sufficient justification or excuse for failing to issue payment to Complainant on the underlying projects. This is an affirmative defense that Respondent bears the burden to establish. Because Respondent failed to appear and provide testimony, this burden has not been sustained. The credible evidence of record shows that Respondent failed to promptly and completely pay Complainant for labor and/or materials on this project, and had no affirmative defense(s) for doing so.

Because Complainant established by a preponderance of the evidence that Respondent violated Ariz. Rev. Stat. § 32-1154(A)(10), Complainant also established cause for the Registrar to discipline Respondent’s contractor’s license. However, because the underlying amount at issue has been paid, the Tribunal accepts this fact in mitigation on behalf of Respondent.

Notably, Complainant may file a Small Claim lawsuit in Justice Court against Respondent for recovery of any outstanding late fees on the underlying contract, as the undersigned Administrative Law Judge has no jurisdiction to issue such an award.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that on the effective date of the Final Order in this matter, Respondent’s Seal West Paving and Sealcoating LLC, ROC License No. 304451 shall be suspended for three (3) days. After which, the Registrar shall close Complaint 2019-05956.

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, March 12, 2020.

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors