ALJDEC decisions subject to certification as final

2021A-02522-RFA-LS-ROC · Registrar of Contractors · 2023-07-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Fariborz Ghafoori,

COMPLAINANT

Adams Construction and Consulting LLC

License No. ROC 305387,

RESPONDENT

No. 2021A-02522-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: June 9, 2023

APPEARANCES: Complainant Fariborz Ghafoori appeared on his own behalf. Jeffery Adams, Qualifying Party and Manager, appeared on behalf of Respondent Adams Construction and Consulting LLC, which was represented by David Williams. The Arizona Registrar of Contractors was represented by Assistant Attorney General Wesley M. Cox.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

The Arizona Registrar of Contractors (Registrar) issued License No. 305387 to Respondent.

On or about June 4, 2021, the Registrar received a Complaint against Respondent from Complainant alleging abandonment with respect to a bathroom remodel at his home.

As a result of the workmanship complaint, the Registrar issued a Citation against Respondent charging possible violations of A.R.S. § 32-1154(A)(2)(b); A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A) and (B); A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158; and A.R.S. § 32-1154(A)(22).

Respondent filed a timely answer to the Citation. An administrative hearing was held. In his December 10, 2021 Decision, Administrative Law Adam D. Stone considered Respondent’s arguments and concluded, among other things, the following:

The preponderance of credible evidence established that a permit was required for the work and Respondent failed to obtain the same at the outset. The Tribunal sympathizes with Mr. Adams regarding the availability of trying to find a structural engineer, but the fact remains, a permit should have been obtained at the outset and was so mentioned in the contract between the parties.

On or about January 7, 2022, the Registrar issued a Final Administrative Decision and Order finding violations and imposing a five day suspension.

Complainant then filed a claim with the Residential Contractors’ Recovery Fund (the Fund) to recover the cost of obtaining a permit and completing the project. As part of the claim process, Complainant submitted bids from different contractors that Complainant had received to complete the project.

The Registrar issued a Notice of Claim for Administrative Payout, finding that Complainant’s compensable actual damages were $30,000.00. Respondent requested a hearing, believing the payout was too high. Complainant did not contest the amount of the administrative payout. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.

Hearing was held on June 9, 2023.

Hearing Evidence

The Directive from the Registrar specified, in pertinent part, as follows:

The Respondent is required to obtain any and all required building permits from the Local Building Authorities prior to making corrections listed in this Directive.

If the local jurisdiction finds corrective issues relating to the respondent’s work, the respondent will be required to correct those issues by appropriate means. The respondent is required to submit a copy of the approved inspection results to the ROC Investigator.

Governing Rule: A.R.S. § 32-1154(A)(2)(b): Departure from or disregard of: (b) A building code...

Governing Rule: A.R.S. § 32-1154(A)(3) – R4-9-108(b) : Violation of any rule adopted by the registrar, Namely R 4-9-108: (B) A contractor shall perform work in accordance with any applicable building codes and professional industry standards.

Tedi Quezada, Legal Assistant for the Fund, testified that she reviewed the Directive from the Registrar that had been issued, Judge Stone’s Decision regarding the underlying complaint, and the bids submitted by Complainant in calculating Complainant’s actual damages. Ms. Quezada concluded that the bid of $45,050.00 included all work necessary to complete the project. Ms. Quezada also noted that Complainant had valid expenditures totaling $3,307.60 that included the permit, engineering, and design.

In analyzing Complainant’s claim, Ms. Quezada used the following calculations to determine the payout:

Original contract price

$22,950.00

Less payment on contract

$22,750.00

Total unpaid balance

$200.00

Valid expenditures on project

$3,307.60

Total compensable bid amount

$45,050.00

Total

$48,357.60

Less unpaid balance

$200.00

Actual damages

$48,157.60

Compensable actual damages

$30,000.00

Investigator John Smith testified that the work detailed in the bid used by Ms. Quezada was consistent with the work required to complete the project as he observed it.

Respondent admitted that no permit was obtained prior to work on the project beginning. Respondent alleged that Complainant owed a balance of $21,300.00 on the contract due to change orders that occurred, but acknowledged that no change orders were ever signed by Complainant during the course of the project. Respondent argued that the work in the bid used by Ms. Quezada did not pertain to the project he had worked on, but was an effort by Complainant to work on a different part of his house paid for by the Fund. Respondent argued that the wall Respondent removed was not a load bearing wall and was not in the vicinity of the wall referenced in the drawings submitted with the permit. Respondent’s counsel asserted in closing that the work in the bid used by Ms. Quezada “could be” for a different bathroom, and if that was true, Complainant would be “defrauding the state.”

Complainant testified that, while he was applying for the permit relevant to this project, he decided to include the other bathroom on the permit to streamline the process and reduce the cost of permitting. Complainant denied that the bid submitted to the Registrar was for any work other than that necessary to complete and repair Respondent’s work on the project. Complainant also denied signing any change orders related to the project.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

The Registrar bears the burden of proof to establish that the proposed payout from the Fund was correct by 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.”

A.R.S. § 32-1132.01(B) provides that “[a]n award from the residential contractors' recovery fund may not exceed the actual damages suffered by the claimant as a direct result of a contractor's violation. Actual damages . . . [m]ay not exceed an amount necessary to complete or repair a residential structure or appurtenance within residential property lines.”

A.R.S. § 32-1132.01(D) provides that “[t]he maximum individual award from the residential contractors' recovery fund is $30,000.”

Respondent failed to establish that any change orders had been executed and remained owing on the project that could then be deducted from Complainant’s actual damages.

The evidence submitted at hearing supported the Registrar’s conclusion that Complainant had actual damages in excess of $30,000.00 and was, therefore, entitled to a payout from the Fund totaling $30,000.00.

After review of all the evidence, the Tribunal concludes that the award provided by the Fund accurately reflected Complainant’s compensable actual damages. Accordingly, Complainant is accordingly entitled to a payout from the Fund in the amount of $30,000.00.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Registrar’s final order, Complainant receive a payout from the Residential Contractors’ Recovery Fund in the amount of $30,000.00.

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 (40) days from the date of that certification.

-54864001

001

-137160-45720000Done this day, July 6, 2023.

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Martín Quezada, Director

Registrar of Contractors

Fariborz Ghafoori

[email redacted]

Seth T. Hargraves

Office of the Attorney General

[email redacted]

David Williams

Davis Miles McGuire Gardner Pllc

[email redacted]

By: OAH Staff