ALJDEC decisions subject to certification as final

2021A-04353-CHC-ROC · Registrar of Contractors · 2022-02-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Grayson Fox Fidler,

COMPLAINANT,

v.

Aqua Splash Plastering LLC

ROC License No. 277715,

RESPONDENT.

No. 2021A-04353-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 21, 2022 at 9:00 AM.

APPEARANCES: Grayson Fidler (“Complainant”) appeared on his own behalf. Mike Nation appeared on behalf of the Arizona Registrar of Contractors (“Registraro”). No appearance(s) by or on behalf of Aqua Splash Plastering LLC (“Respondent”).

ADMINISTRATIVE LAW JUDGE: Jenna Clark

_____________________________________________________________________

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 Director of the Registrar.

FINDINGS OF FACT

Background and Procedure

Pursuant to Ariz. Admin. Code R4-9-117, Administrative Notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website. On March 27, 2012, the Registrar issued License No. 277715 Specialty Dual CR-36 Plastering contracting to Respondent. The license is currently active and renewed through March 31, 2022. Javier Caraveo is the Qualifying Party and Member on the license. Respondent’s address of record for the license is 4541 W. Vogel Ave. Glendale, AZ 85302. Respondent has an active $6,750.00 surety bond on the licensed issued by RLI Insurance Company effective May 08, 2015. There is no prior discipline noted for the license, save one open complaint which is presumably Complainant’s.

Complainant owns residential property located at 1014 W. Kelton Ln. Phoenix, AZ 85023.

On or about June 24, 2021, Complainant and Respondent entered into a verbal $7,200.00 contract for the installation of a pool heating system at Complainant’s residence. Complainant paid $4,000.00 towards the project.

On September 03 2021, the Registrar received a 13-item complaint from Complainant against Respondent’s License No. 277715 alleging abandonment of their project. Attached to the complaint were copies of text messages between the parties regarding the terms of their agreement, and proof of payments Complainant issued to Respondent for the project. The Registrar designated it Complaint No. 2021-04353 and assigned to Mike Nation (“Investigator Nation”) for investigation.

On September 07, 2021, Investigator Nation issued a Notice of Complaint to Respondent.

A Jobsite Inspection Notification Letter was not sent to the parties because no work on the project had taken place.

On September 23, 2021, Investigator Nation issued a Warning Letter to Respondent for an alleged violation of Ariz. Rev. Stat. § 32-1158(A) for Respondent’s failure to include all nine (9) required minimum elements in his contracts, including his contract with Complainant.

On September 23, 2021, Investigator Nation forwarded the matter to the Registrar’s legal department with the issuance of a Citation Recommendation.

On September 24, 2021, the Registrar issued a Citation to Respondent for alleged violations of Ariz. Rev. Stat. §§ 32-1154(A)(1), 32-1154(A)(8), and 32-1154(A)(12); specifically, 32-1158. Respondent was given until October 08, 2021, to respond with its Answer or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A) and 32-1155.

On October 08, 2021, the Registrar received Respondent’s Answer. In pertinent parts, Respondent admitted that he “received money from complainant” and that he had given the money to another individual to buy the heater and materials for the job. Per Respondent, that person was pulled over by law enforcement and detained, presumably indefinitely, and Respondent was not given Complainant’s money back. Respondent further admitted “I know I’m responsible.” Respondent had offered to make repayments in $500.00 increments to Complainant, but his offer was denied as Complainant wanted to be repaid in full. Respondent was unable to return Complainant’s full down payment. Respondent noted that “I don’t want my license suspended or any trouble,” and inquired if the underlying matter could be resolved without a hearing.

On October 20, 2021, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on January 21, 2022. Per the December 20, 2021, Notice of Hearing the issues to be determined are whether the Registrar has cause to discipline Respondent’s license based on the following alleged statutory violations:

Charge 1: A.R.S. § 32-1154(A)(1)

Charge 2: A.R.S. § 32-1154(A)(8)

Charge 3: A.R.S. § 32-1154(A)(12) – A.R.S. § 32-1158

Hearing Evidence

Complainant testified on his own behalf, called Investigator Nation as a witness and submitted Exhibits 1-5 into the record. The Registrar’s agency file was admitted into the record as its own exhibit. The substantive evidence of record is as follows:

Residential property located at 1014 W. Kelton Ln. Phoenix, AZ 85023 is Complainant’s short term rental property. Complainant resides in Oregon.

On May 31, 2021, Complainant contacted Respondent to inquire if Respondent had a recommendation for someone to install a pool heater.

On June 09, 2021, Respondent informed Complainant that he found a plumber who agreed to perform the job for “about $4,800 all included,” and that Complainant could “go through” Respondent, as the referenced trade did not speak English. Respondent asked Complainant for $3,500.00 for materials, and told Complainant that he could pay the balance upon completion of the project. Shortly afterward, Respondent asked Complainant to increase his down payment by $500.00, to $4,000.00.

On July 27, 2021, the parties agreed that the underlying project would be performed August 16, 2021, to August 23, 2021.

On July 28, 2021, Complainant sent two (2) electronic payments via Zelle to Respondent for $500.00 and $3,500.00, totaling $4,000.00, as a down payment for the project.

Due to wire transfer limits imposed by Zelle, Complainant had to complete two transfers to Respondent.

On August 10, 2021, Respondent informed Complainant that the plumber he had secured for the project was arrested, and that Respondent would refund Complainant’s down payment the following week. Respondent explained that the funds were missing, as he had given them to the plumber and had not received them back from him.

On August 17, 2021, Complainant inquired with Respondent about the status of his down payment, to which Respondent surmised that he would have it returned to Complainant by August 20, 2021. However, when Complainant followed-up with Respondent on August 20, 2021, Respondent promised to return the $4,000.00 to Complainant by August 24, 2021.

On August 24, 2021, Respondent did not respond to Complainant’s inquiry regarding the whereabouts of his money.

On August 25, 2021, Complainant warned Respondent that he would file a police report the following day if he did not receive his funds that day.

After Complaint No. 2021-04353 was opened by the Registrar, Respondent offered to repay Complainant in installments. Complainant refused. On September 22, 2021, Respondent again asked Complainant to accept incremental repayments until Complainant’s down payment was returned in full. Complainant declined.

Complainant declined to provide a closing argument.

CONCLUSIONS OF LAW

The Registrar has jurisdiction over this matter pursuant to Ariz. Rev. Stat. §§ 32-1101 et seq. and 32-1154(A). The matter was properly brought before OAH pursuant to Ariz. Rev. Stat. §§ 41-1092 et seq.

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.

Complainant bears the burden of proof to establish cause to discipline Respondent’s license by a preponderance of the evidence. Respondent bears the burden to establish factors in mitigation of the penalty and affirmative defenses by the same evidentiary standard.

“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.”

Ariz. Rev. Stat. § 32-1154(A)(1) holds, in pertinent part, that that among the grounds for suspension or revocation of a contractor’s license is “[A]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.”

Ariz. Rev. Stat. § 32-1154(A)(8) holds, in pertinent part, that that that among the grounds for suspension or revocation of a contractor’s license is a “Failure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract.”

Ariz. Rev. Stat. § 32-1154(A)(12) holds, in pertinent part, that among the grounds for suspension or revocation of a contractor’s license is a “[f]ailure in any material respect to comply with this chapter.” Specifically, Ariz. Rev. Stat. § 32-1158 provides that “Any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved shall contain in writing at least the following information:

1. The name of the contractor and the contractor's business address and license number.

2. The name and mailing address of the owner and the jobsite address or legal description.

3. The date the parties entered into the contract.

4. The estimated date of completion of all work to be performed under the contract.

5. A description of the work to be performed under the contract.

6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes.

7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner.

8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract.

9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar's telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection.

The material facts in this matter are not in dispute.

While the record is unclear as to whether Respondent truly brokered a plumber to complete Complainant’s pool heating project, or whether said unnamed plumber unfortunately absconded with Complainant’s down payment as Respondent alleged in his Answer, the evidence of record clearly establishes that Respondent accepted Complainant’s $4,000.00 down payment and failed to return the monies to Complainant. It is also undisputed that no work on the project ever commenced. It is further undisputed that Respondent’s text message agreement with Complainant did not contain all nine (9) statutory provisions required by law.

Here, Respondent did not act as a disinterested contact, but as a directly and heavily involved party who specifically instructed Complainant to solely deal with him. Respondent provided the terms of the deal. Respondent negotiated the amount of the down payment. Respondent accepted the monies from Complainant. At no point in time did Complainant ever deal with anyone other than Respondent. Per the credible and relevant evidence of record, Complainant has established violations of Ariz. Rev. Stat. §§ 32-1154(A)(1) and 32-1154(A)(12); specifically, 32-1158, by a preponderance of the evidence.

Notably, however, the underlying price for the project never changed. At no point in time did Respondent attempt to solicit or succeed in securing additional funds from Complainant for the project. Thus, Complainant has not established a violation of Ariz. Rev. Stat. § 32-1154(A)(8) by a preponderance of the evidence.

Therefore, the only remaining issue to address is whether Respondent raised sufficient justification or excuse for failing to complete Complainant’s project in a timely fashion or return his down payment within a reasonable period of time. These are an affirmative defenses that Respondent bears the burden to establish. The Tribunal is not at liberty to make presumptions in favor of Respondent or accept facts in mitigation on behalf of Respondent that are not supported by the evidence. Respondent’s absence from this administrative proceeding is, however, a factor in aggravation. The evidentiary record in this matter reflects that Respondent failed to complete the underlying project at issue and never returned Complainant’s down payment; in whole or in part, and had no affirmative defense(s) for doing so.

Because Complainant successfully established one or more statutory violations by a preponderance of the evidence, Complainant has also established cause for the Registrar to take disciplinary action against Respondent’s contractor’s license.

RECOMMENDED ORDER

In light of the foregoing,

IT IS RECOMMENDED that on the effective date of the Final Order in this matter, Respondent Aqua Splash Plastering LLC, ROC License No. 277715, be suspended for ten (10) days based on its violations of Ariz. Rev. Stat. §§ 32-1154(A)(1) and 32-1154(A)(12).

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 five days from the date of that certification.

Done this day, February 10, 2022.

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors