ALJDEC decisions subject to certification as final

2021A-06016-CHC-ROC · Registrar of Contractors · 2022-04-12

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Sunny Beasley,

COMPLAINANT,

v.

J & A Flooring Inc.

ROC License No. 326232,

RESPONDENT.

No. 2021A-06016-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: April 04, 2022 at 9:00 AM.

APPEARANCES: Sunny Beasley (“Complainant”) appeared on her own behalf. Angela Quintana appeared on behalf of J & A Flooring Inc. (“Respondent”) with Jesús Quintana as a witness. Jack Grimm appeared on behalf of the Arizona Registrar of Contractors (“Registrar”).

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 September 18, 2019, the Registrar issued License No. 326232 Specialty Dual CR-48 Ceramic, Plastic and Metal Tile contracting license to Respondent. The license is currently active and renewed through September 30, 2023. Angela Quintana is the Qualifying Party/Vice President on this license, and Jesús Ernesto Quintana Urrea is listed as the President on the license. Respondent’s address of record for the license is 1025 N. Kadota Ave. Case Grande, AZ 85122. Respondent has an active $6,750.00 surety bond on the licensed issued by RLI Insurance Company effective September 17, 2019. There is no prior discipline noted for the license, save two open complaints; one of which is presumably related to this matter.

On or about September 04, 2021, Complainant and Respondent entered into an informal $17,800.00 flooring and paint contract; for labor only as materials were provided by Complainant, for separate projects at Complainant’s residence and Complainant’s friend’s residence.

On or about September 07, 2021, Complainant tendered a $5,000.00 deposit to Respondent. On or about September 27, 2021, Complainant tendered a $1,000.00 progress payment to Respondent. On or about October 05, 2021, Complainant tendered an additional $800.00 progress payment to Respondent.

On October 29, 2021, the Registrar received a 3-page narrative complaint from Complainant against Respondent’s License No. 326232 alleging poor workmanship and abandonment of their project. The Registrar designated it Complaint No. 2021-06016 and assigned to Jack Grimm (“Investigator Grimm”) for investigation.

On December 06, 2021, Investigator Grimm issued a Jobsite Inspection Notification Letter to the parties, advising that she would conduct an inspection of the project on December 21, 2021, at 10:00 a.m.

On December 21, 2021, Investigator Grimm conducted a review of the contractual terms of the parties’ agreement and inspected the work that had been performed on the project to date. He also took photographs of the project site. When he was finished, Investigator Grimm drafted his Inspection Notes. Ultimately, Investigator Grimm determined that there were a total of twenty (20) complaint items, and that seven (7) of them; specifically, items 1, 3-7, and 20, were substantiated as having failed to meet the Registrar’s minimum workmanship standards and required Respondent to perform corrective work to remediate the identified deficiencies.

On December 28, 2021, Investigator Grimm 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 December 28, 2021, Investigator Grimm issued a Warning Letter to Respondent for an alleged violation of Ariz. Rev. Stat. § 32-1154(A)(16) for knowingly working outside the scope of its license.

On December 28, 2021, Investigator Grimm issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated some of Complainant’s workmanship allegations against Respondent. Respondent was put on notice that it had until 5:00 p.m. on January 18, 2022, to notify the Registrar of its compliance with the Directive or face discipline pursuant to Ariz. Admin. Code R4-9-108, and Ariz. Rev. Stat. §§ 32-1154(A)(3), 32-1154(A)(22) and 32-1154(E).

On January 21, 2022, Investigator Grimm escalated the matter to the Registrar’s legal department with the issuance of a Citation Recommendation.

On January 25, 2022, the Registrar issued a Citation to Respondent for alleged violations of Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108, 32-1154(A)(12); specifically, 32-1158, 32-1154(A)(16), and 32-1154(A)(22). Respondent was given until February 09, 2022, to respond with its Answer or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1155.

On February 08, 2022, the Registrar received Respondent’s Answer whereby Mr. Quintana admitted that he used an invoice as the parties’ contract, and argued that the work he performed on Complainant’s shower was done as a “favor,” which was why it was not a part of the related invoice. Per Mr. Quintana, Respondent made no attempt to perform corrective work during the compliance period because he thought the Registrar would assign him one or more dates to perform remediations. Mr. Quintana also denied working outside of the scope of Respondent’s license, and argued that one of his trades showed Complainant how to use a spray gun on her painting project for free.

On February 09, 2022, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on April 04, 2022. Per the February 28, 2022, 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)(3) – A.A.C. R4-9-108

Charge 2: A.R.S. § 32-1154(A)(12) – A.R.S. § 32-1158

Charge 3: A.R.S. § 32-1154(A)(16)

Charge 4: A.R.S. § 32-1154(A)(22)

Hearing Evidence

Complainant testified on her own behalf and called Investigator Grimm as a witness. Jesús Quintana testified on behalf of Respondent. The Registrar’s agency file, including the Notice of Hearing, was admitted into the record as its own exhibit. The substantive evidence of record is as follows:

Complainant owns residential property located at 1417 E. Pedro Rd. Phoenix, AZ 85042. Complainant’s mother, Katherine Sanchez-Laughlin, is the primary resident of the dwelling and initially filed Complaint No. 2021-06016 with the Registrar.

Complainant found Respondent on an online service directory, Angi (formerly Angie’s List). Complainant financed $5,965.00 for the project through Cross River Bank, and paid Respondent $6,800.00.

There was no written contract for the project. Per the terms of their verbal agreement, Respondent was to (i) demo 2,800 sq. ft. of flooring in Complainant’s residence, starting September 04, 2021, and replace with new tile flooring, (ii) paint kitchen cabinets (in Complainant’s home for another residence), and (iii) tile the master shower. The entire project was to take two (2) weeks.

Respondent did not participate in the Registrar’s jobsite inspection. A compliance jobsite inspection was not scheduled in this matter because Complainant indicated in a January 21, 2022, email that no corrective work had been performed, and that she had not had any contact with Respondent during the Directive’s compliance period.

On January 21, 2022, Mr. Quintana called Investigator Grimm and asked when the Registrar would schedule date(s) for him to make repairs on the project. Investigator Grimm pointed out that there had been several emails sent to him regarding Complaint No. 2021-06016, including the Jobsite Inspection Notification Letter and Directive, and at that point Respondent was considered “non-responsive” by the Registrar. Investigator Grimm further pointed out that Mr. Quintana should have reached out to him earlier with questions if had required direction. When Mr. Quintana advised that he still wanted to make repairs, he was informed that complainant was no longer required to grant him access as the matter had already been escalated, but that if the parties were to settle their dispute that would render the complaint and accompanying Citation moot.

Ultimately, the parties were unable to settle.

Both parties declined to provide closing arguments.

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.

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)(3) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[v]iolation of any rule adopted by the registrar.”

Ariz. Admin. Code R4-9-108 requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.”

Ariz. Rev. Stat. § 32-1154(A)(22) provides, in pertinent part, that “[a] holder of a license may not fail to take appropriate corrective action to comply with this chapter or rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar. The written directive shall set forth the time within which the contractor is to complete the remedial action. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive. A license shall not be revoked or suspended nor shall any other penalty be imposed for a violation of this paragraph until after a hearing has been held. The Registrar has the authority to issue license discipline under this provision, including summary suspension, revocation, or imposing a civil penalty or recovery fund award.”

Ariz. Rev. Stat. § 32-1154(E) provides, in pertinent parts, that the Registrar may “[i]mpose a civil penalty not to exceed five hundred dollars on a contractor for each violation. The failure by the licensee to pay any civil penalty imposed results in the automatic revocation of the license thirty days after the effective date of the order providing for the civil penalty.” It also provides that “[n]o future license may be issued to an entity consisting of a person who is associated with the contractor, unless payment of any outstanding civil penalty is tendered.”

The material facts in the case at bar are clear.

Although the parties’ had a $17,800.00 flooring and painting contract, of which Complainant paid Respondent $6,800.00, Respondent failed to supply Complainant with a written contract that contained all nine (9) statutorily required minimum elements. Additionally, it is clear that at least one of Respondent’s trades performed a substantial amount of paint work on Complainant’s project. Regardless of whether it was a “free favor” to Complainant, the actions were outside the scope of Respondent’s license. It is also clear that some of the work Respondent performed on the project did not satisfy the minimum standards set for workmanship by the Registrar. It is also exponentially clear that Respondent failed to attempt to comply with the Registrar’s Directive, and that the parties never settled their underlying dispute.

Therefore, the only outstanding issue to address is whether Respondent raised a sufficient affirmative defense in the matter. Here, Respondent did not sustain his burden of proof. The reason(s) Mr. Quintana offered for his inaction regarding the Registrar’s Directive is nonsensical given the multitude of correspondence he received on the matter. Furthermore, Mr. Quintana offered no evidence to indicate Respondent’s trade entered into a wholly separate and distinct painting arrangement with Complainant, outside of the one Respondent had with her, to overcome Complainant’s credible testimony to the contrary. There is no evidence in the record that excuses or otherwise justifies Respondent’s conduct and/or lack of performance on this project.

Therefore, because Complainant has established Respondent’s violations of Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108, 32-1154(A)(12); specifically, 32-1158, 32-1154(A)(16), and 32-1154(A)(22) by a preponderance of the evidence, Complainant has also established cause for the Registrar to discipline Respondent’s contractor’s license.

Complainant may petition the Registrar’s Recovery Fund for financial recompense regarding this matter.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that five days after the effective date of the Final Order in this matter, Respondent J & A Flooring Inc., ROC License No. 326232, be suspended for five (5) days based on its violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22).

IT IS FURTHER RECOMMENDED that the Registrar require Respondent to pay the sum total of $200.00 in certified funds as a civil penalty in this matter.

IT IS FURTHER RECOMMENDED that if Respondent fails to pay the entire amount of the civil penalty on or before thirty (30) days following the effective date of the Registrar’s Final Order, the Registrar shall 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 Ariz. Rev. Stat. § 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.

Done this day, April 19, 2022.

Office of Administrative Hearings

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

By Miranda Alvarez

Legal Secretary