ALJDEC decisions subject to certification as final

2020A-01215-OMC-ROC · Registrar of Contractors · 2020-11-17

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Arizona Registrar of Contractors,

COMPLAINANT

ABCO Solar Inc.,

License No. ROC 258378,

RESPONDENT

No. 2020A-01215-OMC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: October 28, 2020

APPEARANCES: The Arizona Registrar of Contractors was represented by Assistant Attorney General John Tellier. Respondent ABCO Solar Inc. was represented by Eric Thomae.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

On or about October 1, 2014, the Arizona Registrar of Contractors (Registrar) granted an application for Qualifying Party Exemption under A.R.S. § 32-1125(C) to License No. 258378 previously issued to ABCO Solar Inc. (Respondent).

In the notice to Respondent regarding the Qualifying Party Exemption, the Registrar included an advisement that, “once approved two conditions must be met to keep the exemption pursuant to Arizona law.” The notice included the language from A.R.S. § 32-1125 detailing the conditions.

On or about June 3, 2019, the Registrar received a complaint from Brian Bowers against Respondent. The complaint was designated as Case No. 2019-02850.

An initial hearing session was held in Case No. 2019-02850 during which Mr. Bowers was represented by legal counsel.

After the initial hearing session and the second hearing session, Respondent’s insurance company issued a payment of $39,323.39 to Mr. Bowers related to the claim at issue and Mr. Bowers deposited that payment. Respondent was unaware that a payment had been made on the claim at the time or that Mr. Bowers had accepted that payment.

At the second hearing session in Case No. 2019-02850, Mr. Bowers appeared unrepresented by counsel. Mr. Bowers did not advise the Administrative Law Judge of the payout from the insurance company prior to the conclusion of the second hearing session.

After the hearing concluded, the Administrative Law Judge found that Respondent committed a violation of A.R.S. § 32-1154(A)(3) and should pay restitution to Mr. Bowers in the amount of $10,210.00. The Registrar accepted the Administrative Law Judge’s recommendation and entered a Final Administrative Decision and Order.

Respondent requested a rehearing based on the newly obtained information that its insurance company had issued a payout prior to the second and Mr. Bowers had failed to advise the Administrative Law Judge of that payout prior to the hearing concluding. The Registrar denied Respondent’s request for rehearing.

Respondent elected not to appeal the Final Administrative Decision and Order due to the cost of pursuing such an appeal and the need to proceed with other large projects.

Pursuant to the Final Administrative Decision and Order, License No. 258378 was suspended from February 18, 2020, until March 18, 2020, when the restitution payment was made by Respondent.

On or about August 28, 2020, the Registrar issued a Notice of Administrative Disqualification Proceeding to Respondent, including and requesting Respondent to execute a Waiver of Disqualification Hearing.

On or about September 14, 2020, the Registrar received Respondent’s Request for Hearing Re: Administrative Disqualification.

The matter was referred to the Office of Administrative Hearings for an evidentiary hearing.

At hearing, the Registrar presented the testimony of Chance Peterson, Assistant Chief Counsel for the Registrar, and submitted exhibits 1 through 5. Respondent presented the testimony of David Shorey, Vice President of Operations, and submitted exhibits 1 and 2.

Mr. Shorey testified as to the facts surrounding the complaint in Case No. 2019-02850. Respondent argued that the violation found in Case No. 2019-02850 had nothing to do with its solar work on the project, but was a collateral issue relating to damage to the parking lot. Respondent indicated that the only reason a violation was found was because of Mr. Bowers’ deception regarding the insurance payout. Respondent argued that it did not appeal the final decision based on a cost-benefit analysis, not because it believed it had committed the violation. Mr. Shorey testified that Mr. Bowers refused to enter into a financial settlement with Respondent because he was demanding that Respondent repave the entire parking lot instead of repairing the damaged area. Mr. Shorey indicated that Mr. Bowers received a windfall between the insurance payment and the restitution paid. Respondent also asserted that it was a financial burden to require a qualifying party.

The Registrar argued that the requirement of a qualifying party was not overly burdensome as 99.9 percent of licensees were required to have one. The Registrar also maintained that whether the work was directly related to Respondent’s solar work or was secondary, the damage was caused by Respondent and thereby constituted a violation of the workmanship statutes.

Administrative notice is taken of Respondent’s prior license record as reflected on the Registrar’s public website on November 16, 2020. Such prior License record reflected that Respondent’s License No. 258378 was under renewal. Such prior license record also reflected that were no other open or prior complaints against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1122.

Respondent bears the burden of proof to establish that it meets statutory qualifications for a Qualifying Party Exemption by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(1); A.A.C. R2-19-119; see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “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).

A.R.S. § 32-1125 provides, in relevant part, as follows:

E. A licensee that is exempt from the requirement for a qualifying party pursuant to subsection C of this section may be required by the registrar after a hearing to obtain a qualifying party within sixty days on a finding that:

. . . .

2. A violation of section 32-1154 has occurred.

Emphasis added.

The evidence of record supports the conclusion that Respondent committed a violation of A.R.S. § 32-1154. However, pursuant to the statute, the Registrar has the discretion to not require Respondent to obtain a qualifying party based on that violation.

Based on the specific facts presented in this case, Respondent established a sufficient basis for the Registrar to exercise that discretion to allow Respondent to maintain its license without a qualifying party. While Mr. Bowers’ withholding of the insurance payout prior to the second hearing session did not eliminate the fact Respondent committed a violation of the workmanship standard, it did affect the outcome of the hearing. Generally speaking, if the parties reach a resolution prior to the hearing, the matter is vacated and a violation is not found, even if one occurred. In such instances, the complaint is considered settled or withdrawn. Had Mr. Bowers been truthful with the Administrative Law Judge, the result in this matter could have had a similar outcome. Rather, Mr. Bowers chose to proceed with the hearing and obtain a second payout from Respondent in addition to the insurance payout he had already received and accepted.

One cannot assume that licensees that have a Qualifying Party Exemption have never committed a workmanship violation, but rather, that they have had the opportunity to work with their customers to correct issues and/or reach a financial settlement to “make things right.” However, because of Mr. Bowers’ actions in the underlying matter, Respondent was denied the ability to do that. Respondent should not be held solely responsible for Mr. Bowers’ unwillingness to work with Respondent and dishonesty with the Office of Administrative Hearings.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that the Registrar’s Notice of Administrative Disqualification Proceeding be dismissed.

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 forty days from the date of that certification.

-54864001

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-137160-45720000Done this day, November 17, 2020.

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors-54864001

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-137160-45720000