ALJDEC decisions subject to certification as final

2020A-03218-RFA-LS-ROC · Registrar of Contractors · 2022-01-05

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Nancy L Pietz,

COMPLAINANT,

v.

Muse Home Maintenance, LLC,

License No. ROC 323053,

RESPONDENT.

No. 2020A-03218-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: December 16, 2021.

APPEARANCES: The Arizona Registrar of Contractors was represented by Assistant Attorney General Sarah A. Asta. Nancy L. Pietz (“Complainant”) appeared representing herself. Respondent did not appear.

ADMINISTRATIVE LAW JUDGE: Kay Abramsohn

_____________________________________________________________________

FINDINGS OF FACT

On December 24, 2018, the Arizona Registrar of Contractors (“Registrar”) issued License No. 323053, CR-61, Carpentry, Remodeling and Repairs, to Respondent.

On July 4, 2020, the Registrar received a Complaint (the “Workmanship Complaint”) against Respondent from Complainant alleging that contracted-for work performed by Respondent at Complainant’s home was “incomplete and unsatisfactory” and that some work had not been started yet.

Complainant specified in the Workmanship Complaint that the contract date was August 31, 2018 and that work had started on September 20, 2018. Complainant further specified that the contract amount was $24,500.00 and that she had paid Respondent $22,000.00.

Item #1 on the Workmanship Complaint states as follows:

$1000.00 paid on August 31, 2018 to repair patio roof that was leaking and to replace a window. The patio work was started September 20, 2018 but the roof continues to leak. The window was replaced June 19, 2019. The agreed upon amount was for $1000.00 to repair roof and replace window. The leak locations have been marked. Repairs have not been started.

Complainant provided a copy of “Estimate 1255” dated July 30, 2018, which lists various construction work to be performed for a total amount of $8,677.36.

Complainant provided an explanation with the Workmanship Complaint, within which she indicated that she had paid $1,000.00 on August 31, 2018 to repair a patio roof and replace a window. Complainant indicated, however, that the roof continued to leak and that the window had been replaced in June of 2019. In the explanation, Complainant noted that “Estimate 1255” had included the repair for the patio roof. Complainant described the various issues that had been discussed by the parties regarding Estimate 1255, the workmanship issues she was bringing forward, the progress and stoppage of work (in or around May of 2019), and her efforts to have Respondent come back onto the project to complete the work. While work was being performed, Complainant paid Respondent $4,000.00 on January 7, 2019 and $17,000.00 on January 31, 2019.

Following the Registrar’s August 11, 2020 jobsite inspection, the Registrar issued a warning letter to Respondent regarding written minimum contract requirements and possible violations of A.R.S. § 32-1158(A).

Regarding workmanship, following the Registrar’s August 11, 2020 jobsite inspection and the Registrar’s issuance of a Written Directive on August 14, 2020 for Respondent to correct the work that had been found to fail to meet workmanship standards, the Registrar’s Investigator conducted a compliance jobsite inspection on October 6, 2020. At that time, the Registrar’s Investigator was informed by Complainant that Respondent had failed to comply with the Directive and had not corrected correct any of the work.

On October 8, 2020, the Registrar issued its Citation, charging Respondent with possible violations of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108; A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158; and A.R.S. § 32-1154(A)(22).

Respondent failed to file an answer to the Citation, which answer is required by law.

On November 13, 2020, the Registrar of Contractors issued a Final Administrative Decision and Order finding that Respondent violated the provisions of A.R.S. § 32-1154(A)(3), (12), and (22), and revoking Respondent’s license.

On February 12, 2021, Complainant filed a claim (Claim”) with the Residential Contractors’ Recovery Fund (“Fund”) to recover $28,283.71, as the cost of completing or repairing the contracted-for work. On the Fund Claim, Complainant noted the contract date was “started” as of August 31, 2018, which she also indicated had been the date of the first payment to Respondent. Complainant indicated that the contract had been both written and verbal. Complainant further indicated that contract amount was “hard to determine” and she noted that she had paid Respondent $28,500.00.

Complainant provided an explanation letter with her Fund Claim indicating, among other items, that she had received a different version of their contract on April 29, 2019. Complainant further stated therein that she had received “documentation” from Respondent at that time “which included double billing and billing for work not done.”

At some point, the Registrar was provided with the following:

a. An invoice No. 1585 dated September 21, 2018 dealt specifically with the patio roof repair and window, showing an additional $361.97 to be due. Exhibit 3 at ROC0017.

b. An invoice No. 1582 dated January 30, 2019 regarding a back bathroom, floating a concrete floor, and interior painting, showing an amount of $6,825.00. Exhibit 3 at ROC0023.

c. An invoice No. 1584 dated April 22, 2020 regarding demolition, materials, and construction activity in a bathroom, showing an amount of $11,389.97. Exhibit 3 at ROC0024-26.

d. A written contract for the purchase by Respondent’s owners of an AKC registered male bulldog puppy for $3,500.00 from Complainant, documenting in the payment terms: “Credit for work done at [Complainant’s address] at time to be arranged between [Respondent] and [Complainant].” Exhibit 3 at ROC0027-30; also Exhibit M.

e. A second written contract for the purchase by Respondent’s owners of an AKC registered female bulldog puppy for $3,000.00 from Complainant, documenting in the payment terms: “Credit for work done at [Complainant’s address] at time to be arranged between [Respondent] and [Complainant].” Exhibit 3 at ROC0031-34; also Exhibit N.

Upon its initial review of Complainant’s Fund Claim, Registrar requested additional information from Complainant and Complainant provided additional explanations and documentation.

On its review of the Fund Claim, the previously-issued Directive, and subsequent evidence provided, the Registrar issued its Notice and Order of Recovery Fund Ineligibility (“Notice and Order”) dated September 22, 2021.

On October 6, 2021, Complainant requested a hearing protesting the determination of ineligibility. In the hearing request, Complainant indicated that the scope of work” paid for on August 31, 2018 was for replacement of a window and repair of the patio roof just as she had indicated on the check in payment itself.

In her request, Complainant indicated that the “vast majority’ of the work had actually been contracted for in January of 2019, at the time when Respondent was licensed. Complainant listed the following work: repair of the Jack and Jill bathroom; a second shower; stained concrete floors in certain rooms; building a water heater shed; and rebuilding a shed. Complainant explained that the parties had met on January 5, 2019 to “ascertain the scope of work to be done going forward.” Complainant further explained that Respondent wanted a $5,000.00 deposit to begin the work in January and that she had indicated to him that she did not have $5,000.00 but could give him $2,000.00 that day and $2,000.00 for another day once the bank transfer had been made. Regarding payments, Complainant indicated that she paid Respondent $17,000.00 on January 31, 2019 with money she had borrowed.

Registrar subsequently referred the matter to the Office of Administrative Hearings (“OAH”) for an evidentiary hearing. OAH issued an ORDER for the matter to be conducted virtually.

At hearing, Complainant argued that the vast majority of the work had been done, under verbal discussion and agreements, beginning in January of 2019 and through the progress of the work. Complainant argued that she had erred in being all inclusive and further argued that her written explanations and evidence clearly demonstrated the scope of work that had taken place in September of 2018 versus the scope of work that began in January of 2019. Complainant made a motion to remove Item #1 from the Complainant and from the Fund Claim in regard to the cost to fix Item #1. Complainant argued the contract was severable as to the patio roof and window repair work and she requested the Tribunal amend the Complaint to the evidence and find her eligible for a Fund Claim.

The Registrar argued that Complainant is ineligible by virtue of application of A.R.S. § 32-1132(C) and (D), which requires that the contractor have been “appropriately licensed” at one of the following times: the date the underlying contract was signed; the date the first payment was made; and the date the underlying work was commenced. In this case, the Registrar argued that Respondent was not licensed at either (1) the time of the $1,000.00 payment August 31, 2018 or (2) at the time that the underlying work had first commenced on September 20, 2018. Regarding Complainant’s motion, the Registrar argued that Complainant’s documentation demonstrates the existence of the parties’ contract through the Estimate 1255 and that Complainant’s filings to the Registrar both for the Workmanship Complaint and the Fund Claim provide her signed statements that the information therein is “true and accurate” and “true and correct” respectively. The Registrar argued that, at no time, prior to either of the Registrar’s determinations in these two separate processes did Complainant clarify or amend the two filings and that Complainant is unable to contradict her pleadings on which the Registrar made its determinations at this time.

The Administrative Law Judge finds the hearing record demonstrates that Respondent was not appropriately licensed at either (1) the time of the $1,000.00 payment on August 31, 2018 or (2) at the time that the underlying work had first commenced on September 20, 2018.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

The burden of proof at an administrative hearing is generally upon the person who brings the action. Utah Construction Company v. Berg et al., 68 Ariz. 285, 205 P.2d 367 (1949); A.A.C. R2-19-119(B). Further, the standard of proof at hearing is by preponderance of the evidence. Smith v. Ariz. Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985); A.A.C. R2-19-119(A).

The party contesting a Registrar’s Notice and Order regarding a recovery fund claim bears the burden of proof to show entitlement to any amount other than that in the Notice and Order. Therefore, In the instant matter, Complainant bears the burden of showing, by a preponderance of the evidence, that the Registrar’s ineligibility determination is not reasonable and proper.

The Fund is empowered to determine and subsequently award, based on eligibility and actual damages, the appropriate payment to an eligible claimant pursuant to A.R.S. § 32-1132 and A.R.S. § 32-1154(F).

A.R.S. § 32-1132(C) provides as follows:

In order for a claimant to be eligible for an award from the residential contractors' recovery fund, the contractor whose actions damaged the claimant must have been appropriately licensed at one of the following times:

1. The date that the underlying contract was signed.

2. The date that the first payment was made.

3. The date that the underlying work first commenced.

A.R.S. § 32-1132(D) provides as follows:

For the purposes of this section, "appropriately licensed" means the residential contractor held a valid residential contractor license that was issued pursuant to this chapter and that was not canceled, in inactive status, expired, suspended or revoked.

The Administrative Law Judge concludes that the hearing evidence established that Complainant is ineligible for an award from the Fund pursuant to A.R.S. § 32-1132(C) and (D) and further concludes that the Registrar’s September 22, 2021 Notice and Order should be upheld.

RECOMMENDED ORDER

The Registrar of Contractors shall deny Complainant’s appeal of ineligibility and uphold the Registrar’s September 22, 2021 Notice and Order of Recovery Fund Ineligibilty.

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 40 days from the date of that certification.

Done this day, January 5, 2022.

/s/ Kay Abramsohn

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors