ALJDEC decisions subject to certification as final

2020A-04463-NPC-ROC · Registrar of Contractors · 2021-07-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Desert Legacy Construction LTD,

COMPLAINANT,

v.

JP Custom Wood Works, Inc.,

License No. ROC 282171,

RESPONDENT.

Case No. 2020A-04463-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: June 10, 2021

APPEARANCES: Kelly Craig appeared on behalf of Desert Legacy Construction LTD (“Complainant”). No person made an appearance on behalf of JP Custom Wood Works Inc. (“Respondent”).

ADMINISTRATIVE LAW JUDGE: Kay Abramsohn

_____________________________________________________________________

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 Registrar of the Arizona Registrar of Contractors (“Registrar”).

FINDINGS OF FACT

Background and Procedure

On November 27, 2012, the Registrar issued ROC License No. 282171 for Specialty Dual CR-60 Finish Cabinetry contracting to Respondent. Peter Klaus Antoni is listed on the license as the Qualifying Party. The address of record for the license is 7280 North Glen Harbor Blvd, Ste 103 in Glendale, Arizona 85037-1814.

Pursuant to Arizona Administrative Code (“Ariz. Admin. Code”) R4-9-117, Administrative Notice is taken of Respondent’s license file as shown on the Registrar’s public website June 30, 2021. ROC License No. 282171 is active and renewed through November 30, 2022. There is one open complaint listed on the Registrar’s website, which is this open complaint. Respondent has an active $6,750.00 surety bond for the license issued through RLI Insurance Company, effective November 3, 2014.

On September 16, 2020, the Registrar received a complaint from Complainant alleging nonpayment against Respondent. Specifically, Complainant alleged that Respondent gave a quote (and the parties contracted) for Respondent to supply new cabinets for a project for Complainant, that Respondent cashed Complainant’s deposit check in partial payment but never delivered the cabinets, and that Respondent has not refunded the deposit payment back to Complainant despite Respondent’s qualifying Party indicating that he would. Respondent owes Complainant a repayment of $6,940.75 as a result.

Registrar designated the complaint as Complaint No. 2020-04463.

Complainant had filed a civil lawsuit against Respondent in Maricopa County Justice Court, which lawsuit was active at the time of the Complaint. As a result, by letter dated September 23, 2020, the Registrar closed the Complaint indicating that if Complainant obtained a judgment against Respondent, Complainant could provide a copy of the judgment and the Registrar would then decide whether to pursue disciplinary action at that time.

On September 25, 2020, Judge Huberman of the Maricopa County Justice Court entered a default judgment against Respondent in the amount of $7,860.75.

By letter dated March 18, 2021, the Registrar issued its notice to Respondent of the Complainant’s no pay Complaint and informed Respondent that it was free to raise any affirmative defense(s) or provide additional information by March 25, 2021.

On March 30, 2021, 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 April 14, 2021, 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(C), and could result in discipline against Respondent’s license including suspension or revocation.

On April 13, 2021, Respondent emailed an Answer to the Registrar which stated, in pertinent part, “The payment owed to them will be paid by 4/16/2021.”

On April 14, 2021, the Registrar forwarded a copy of the Answer to Complainant.

The matter was referred to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing after Complainant notified the Registrar that it had not received Respondent’s payment.

On May 7, 2021, the Registrar issued its Notice of Hearing to the parties. Pursuant to 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:

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

Hearing and Evidence

By ORDER dated May 25, 2021, the parties were provided the opportunity to participate virtually in the noticed administrative hearing. While Complainant appeared virtually, there was no appearance by or on behalf of Respondent either virtually or telephonically.

Complainant’s Office Manager, Kelly Craig, testified regarding the background in this matter.

The Notice of Hearing and Registrar’s agency file (as forwarded to the Tribunal from the Registrar) were admitted into the hearing record. The substantive facts of record are as follows:

On April 30, 2019, Complainant contracted with Respondent for Respondent to provide custom cabinets and to perform some additional cabinetry work for a project.

By check dated August 13, 2019, Complainant made a payment to Respondent, which payment included a deposit payment, for the particular project and cabinets at issue, in the amount of $6,940.75.

Respondent failed to deliver the cabinets and, although multiple efforts were made by Complainant, after the deposit monies were cashed, to seek delivery of the cabinets and/or determine the problem, and to seek redress, Respondent stopped responding to Complainant.

Complainant’s attempts to work out a payment arrangement with Respondent have been unsuccessful.

At hearing, Complainant argued that Respondent has made promises to pay, most recently in April 2021, but that Respondent has not yet refunded the Complainant’s deposit monies to Complainant. Complainant noted that it would have accepted a payment arrangement with Respondent, but that Respondent did not make any payment. Complainant expressed concern that Respondent continues to be licensed while exhibiting these poor business practices.

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.”

Ariz. Rev. Stat. § 32-1156.01 states, in pertinent part, that after a hearing an Administrative Law Judge may provide restitution to any person who is injured by an action of a licensee.

The material facts in this case are not in dispute.

It is undisputed that Complainant and Respondent entered into a written contract on or about April 30, 2019 for Respondent to supply cabinets and perform other cabinetry work, whereby: Complainant made a deposit payment, Respondent failed to deliver the cabinets, and Respondent failed to refund the Complainant’s deposit payment that had been made pursuant to the contract.

Therefore, the only issue remaining is whether Respondent raised a sufficient justification or excuse for failing to make a refund payment to Complainant. Respondent bears the burden to establish any affirmative defense. Because Respondent failed to appear and provide testimony, Respondent failed to meet this burden. The credible evidence of record shows that: Complainant made a deposit payment to Respondent on the parties’ contract; Respondent failed to perform on his contract; and Respondent failed to make a complete refund of the deposit monies received on the contract, with no affirmative defense 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.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that on the effective date of the Final Order in this matter, Respondent’s ROC License No. 282171, shall be suspended until Respondent provides the Registrar with proof that $6,940.75 has been tendered to Complainant in certified funds as restitution and Complainant has verified to the Registrar the payment was received.

IT IS FURTHER RECOMMENDED that after the Registrar has received Respondent’s proof of payment to Complainant and Complainant’s verification, Complaint 2020-04463 may be closed.

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, July 1, 2021.

/s/ Kay Abramsohn

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Registrar

Arizona Registrar of Contractors