ALJDEC decisions subject to certification as final

2020A-04686-CHC-ROC · Registrar of Contractors · 2021-02-17

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Shelley Abeyta

COMPLAINANT

Paddock Pools LLC,

License No. 328832,

RESPONDENT

No. 2020A-04686-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: February 11, 2021

APPEARANCES: Complainant Shelley Abeyta appeared on her own behalf. Brian Umberger, employee, appeared on behalf of Respondent Paddock Pools LLC.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

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FINDINGS OF FACT

On May 11, 2020, the Arizona Registrar of Contractors (Registrar) issued Paddock Pools LLC (Respondent) License No. 328832. Tina Thorpe was listed as the Qualifying Party on the license. Respondent’s license was a provisional license that was issued pursuant to Executive Order 2020-17 – Continuity of Work.

On or about May 21, 2020, Shelley Abeyta (Complainant) signed a contract with Respondent for the construction of a swimming pool at her home. The initial contract price was $56,868.20, with a subsequent change order of $4,537.79, which resulted in a total cost of $64,405.99. Complainant was to pay a $1,000.00 deposit upon signing the contract, three separate 30 percent payments upon completion of excavation, shotcrete, and deck/tile, and the remainder due on the day of interior finish.

Through a letter dated July 27, 2020, the Registrar informed Respondent that its provisional license was suspended because Respondent’s qualifying party had failed to pass the required examinations by the provided testing date. The Registrar’s letter informed Respondent that it could no longer provide contracting services as of the date of the letter.

The Registrar’s letter also informed Respondent that the suspension of its license would be lifted if the Registrar received notification that the qualifying party had passed the required examinations before the provisional license expired on November 11, 2020.

Prior to the completion of the deck/tile, Mr. Umberger demanded the third 30 percent payment stating that Respondent would be unable to continue the project without the payment because he needed to money to purchase materials. Complainant made the third payment of $14,330.75 on September 17, 2020, bringing the total amount paid on the project to $52,255.99.

After receiving the September 17, 2020 payment, Respondent failed to return Complainant’s calls, texts, emails, and certified letters.

On or about October 7, 2020, the Registrar received a Complaint against Respondent from Complainant alleging abandonment with respect to the project.

The Registrar assigned the complaint to Investigator Wes Ellington. After a jobsite inspection, Investigator Ellington issued an extensive written directive to Respondent with a deadline for completion of 5:00 p.m. on November 16, 2020.

Following the issuance of the written directive, Respondent made no effort to contact Complainant regarding the project. After the deadline in the directive expired, Investigator Ellington was notified no corrective work had been performed.

The Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(1) and A.R.S. § 32-1154(A)(22).

Investigator Ellington testified that, while Respondent was unable to perform any of the directed corrective work while its license was suspended, Respondent could have reached a financial settlement with Complainant to resolve the issues raised in the complaint and written directive.

Complainant testified that she requested a refund of the third payment of $14,330.75 and delivery of the pool equipment that she had previously paid for. Complainant represented that, without the money being refunded, she would be unable to complete the project. Complainant reported that her backyard consisted of a hole with rebar sticking up all over and exposed pvc pipes. Complainant testified that other licensed contractors had informed her it would cost more than $50,000.00 to complete the project.

Mr. Umberger refused to take any responsibility on behalf of Respondent with respect to Complainant’s project. Mr. Umberger started his testimony with the assertion that the Registrar was “ultimately responsible for what happened” because the Registrar should have suspended Respondent’s license earlier than it ultimately did. Mr. Umberger’s testimony was inconsistent throughout his presentation. At one point, Mr. Umberger stated that when Respondent’s license was suspended on July 27, 2020, Respondent was notified of that suspension, perhaps not on that exact date, but shortly thereafter. Mr. Umberger later stated that Respondent was unaware the license had been suspended when he demanded and received the September 17, 2020 payment from Complainant. Mr. Umberger indicated that when Respondent’s license was suspended, its income stream dried up because it was unable to sell any new pools. Mr. Umberger then stated that it did not sell any new pools after the July 27, 2020 suspension because it was focused on finishing existing projects. Mr. Umberger was never able to provide a specific answer as to when Respondent became aware of the suspension, but indicated it must have been before the directive was issued in this matter. Mr. Umberger averred that he understood he was not able to speak to Complainant after the directive was issued because Respondent’s license was suspended. Mr. Umberger argued that Respondent could not be in violation of A.R.S. § 32-1154(A)(1) because its license was suspended and therefore it was legally prevented from completing the project.

Administrative notice is taken of Respondent’s prior License record on February 12, 2021. Such prior License record reflects that Respondent’s License No. 328832 was first issued on May 11, 2020, and was suspended on July 27, 2020. Such prior License record also reflects that there were three open complaints against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

Respondent’s suspended license does not deprive Complainant of her right to prosecute her complaint or prevent the Registrar from determining the merits of the complaint. See A.R.S. § 32-1154(D).

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); 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. § 32-1154(A)(1) includes among the grounds for suspension, revocation, or other disciplinary action against 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.”

A.R.S. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other disciplinary action against 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.”

Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).

The uncontroverted evidence at hearing established that Respondent did not complete the project as required by the contract. Respondent’s argument that the suspension of its license constitute “legal excuse” for its abandonment of the project is without merit.

Respondent was completely in control of whether its license was suspended. Further, Complainant did nothing to prevent Respondent from performing work on the project. To accept Respondent’s argument, licensees could allow their license to be suspended for failure to renew or lack of bond simply to avoid completing contracts without consequence.

Allowing a licensee to avoid performance of a contract, after knowingly demanding and accepting payment on the contract while its license was suspended, without any disciplinary action, fails to protect the public from unscrupulous, unqualified, and financially irresponsible contractors.

The evidence established that Respondent entered into a contract and did not perform the work in the contract. Accordingly, Complainant established that Respondent abandoned the contract in violation of A.R.S. § 32-1154(A)(1).

The evidence established that Respondent did not attempt to complete the corrective work following the Directive being issued through any financial settlement with Complainant. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall revoke Respondent’s License No. 328832.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s final order, the Registrar revoke Respondent’s license, 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 40 days from the date of that certification.

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-137160-45720000Done this day, February 17, 2021.

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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-137160-45720000