ALJDEC decisions subject to certification as final
2021A-06063-CHC-ROC · Registrar of Contractors · 2022-06-12
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Ashley Crisci,
COMPLAINANT
v.
JM Precision Development Inc
License No. ROC 312801,
RESPONDENT
No. 2021A-06063-CHC-ROC
ADMINISTRATIVE LAW JUDGE
DECISION
HEARING: June 1, 2022
APPEARANCES: Ashley Crisci on her own behalf; Jeremy Morris for Respondent
ADMINISTRATIVE LAW JUDGE: Thomas Shedden
FINDINGS OF FACT
On May 2, 2022, the Registrar of Contractors (“ROC”) issued a Notice of Hearing on Contested Case setting the above-captioned matter for hearing on June 1, 2022 at the Office of Administrative Hearing.
Through its Notice of Hearing, ROC alleges that Respondent JM Precision Development Inc. may have violated Ariz. Rev. Stat. sections 32-1154(A)(3), (A)(8), and (A)(22).
Respondent holds license No. 312801 issued by ROC. Jeremy Morris is Respondent’s owner.
Complainant is Ashley Crisci. Complainant did not file a disclosure statement.
In September 2021, Complainant and Respondent entered a contract that called for Respondent to perform work at Complainant’s house.
According to Respondent’s Answer to ROC’s Citation, the original scope of work related an insurance claim Complainant made for water damage and was limited to work approved by Complainant’s insurer, but after work started it was discovered that the damage was more extensive than had been anticipated and Complainant requested that Respondent perform additional work, including remodeling work.
The parties agreed to change orders, but these were not memorialized prior to Respondent completing that work and the parties’ dispute the appropriate value of the work Respondent performed based on those change orders.
Complainant testified to the effect that she did not believe the change orders were valid because she had not signed these change orders, but she acknowledged that Respondent had performed change-order work.
The original contract price was $40,192.70, with 50% due on signing, 30% due on erection of patio beam structure & installation of new drywall, 10% due on completion of self-leveling concrete, and the remaining 10% due on completion.
Consistent with the contract, Complainant paid to Respondent $20,096.35 on signing and she paid an additional $12,057.85 in October 2021.
On November 4, 2021, Respondent sent Complainant invoices for the change-order work. On November 5, 2021, Complainant emailed Mr. Morris informing Respondent that she was terminating the contract.
On November 10, 2021, Complainant filed with ROC a complaint against Respondent alleging poor work on Respondent’s part. Complainant also filed an addendum to her complaint, but there was no evidence adduced as to the date of that addendum.
On November 10, 2021, Complainant also filed a claim with Respondent’s bonding company, which claim was denied.
ROC investigator Jason Simpson conducted a jobsite inspection on January 19, 2022 at which time he considered the issues raised in Complainant’s complaint and her addendum.
On February 10, 2022, ROC issued to Respondent a Directive that provides in part:
*** You must notify the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on February 28, 2022 .
***
DIRECTIVE REQUIREMENTS
You are directed to remedy the following violations by the appropriate means:
Complaint Item 1: “Poor work, walking deck, wood splinter, and no able o be walked on/ gap unsafe”
Investigator’s Observation: This allegation is verified as the responsibility of the respondent. Respondent stated that the decking boards were not cut correctly and would make necessary repairs to correct.
Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.
Complaint Item 2: “Unfinished work, refusal proof of material”
Investigator’s Observation: This allegation is verified as the responsibility of the respondent. Work has not been completed.
Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.
Complaint Item 5: “Charged for work not finished”
Investigator’s Observation: This allegation is verified as the responsibility of the respondent. Work not completed per contract.
Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.
Complaint Item 7: “Living water damage in window and flooring removed”
Investigator’s Observation: This allegation is verified as the responsibility of the respondent. Work not complete on removal of flooring and water damaged not addressed. Contractor should complete all work per contract agreement.
Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.
Complaint Item 8: “Roof foam added around decking holding water”
Investigator’s Observation: This allegation is verified as the responsibility of the respondent. Contractor should necessary repairs.
Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.
Respondent performed work after receiving the Directive, but did not complete all the work ROC ordered it to complete before the deadline for compliance.
Respondent attempted to perform additional work after that deadline but Complainant was unwilling to allow it access to do so.
Included in the work Respondent performed after ROC issued its Directive was pouring the self-leveling concrete, after which Complainant was obligated to pay the third draw of $4019.25.
Complainant was unwilling to pay the third draw of $4019.25 because she was of the opinion that Respondent had not yet completed 80% of the work. Complainant did however make an additional payment of $2000.
On March 11, 2022, Mr. Simpson conducted a compliance jobsite inspection at which time he determined that Respondent had corrected complaint items 1 and 8, and that item 7 had been resolved.
Regarding complaint items 2 and 5, Mr. Simpson testified that there was painting that had not been completed and that although the doors at issue had been installed, the required finish-work related to that installation had not been completed.
ROC issued to Respondent a Citation dated April 16, 2022, through which ROC alleges that Respondent may have violated Ariz. Rev. Stat. sections 32-1154(A)(3), (A)(8) and (A)(22).
Respondent filed its Answer, asserting among other things that Complainant had breach the contract, thereby excusing any failure of Respondent to complete the contract.
Mr. Morris testified consistently with his position that Complainant had breached the contract. He also testified to the effect that Complainant had informed him that she did not intend to make any additional payments regardless of what work Respondent completed and that ROC was aware of this when it issued its Directive.
Respondent acknowledged that the work took longer than the original contract called for, but he explained that this was because the scope of work expanded, there were delays in obtaining material, and because Complainant did not provide Respondent with the information necessary to obtain some materials.
Complainant did not agree that all delays had been based on her failure to provide Respondent with the required information.
Complainant noted that Respondent had been refusing to order material unless Complainant made additional payments. Emails in the record support Complainant’s contention on this point, but those emails were all sent after Complainant terminated Respondent’s contract in November 2021.
CONCLUSIONS OF LAW
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. Ariz. Admin. Code § R2-19-119.
“At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(2).
“At a hearing on an agency's imposition of fees or penalties or any agency compliance order, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(3).
A preponderance of the evidence is:
The 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.
Black’s Law Dictionary 1373 (10th ed. 2014).
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).
It has not been shown by a preponderance of the evidence that Respondent is unscrupulous, unqualified, or financially irresponsible.
The Administrative Law Judge may consider ROC’s administrative record. See Ariz. Admin. Code § R4-9-118.
Ariz. Rev. Stat. section 32-1154(A) provides that
The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions:
*****
3. Violation of any rule adopted by the registrar.
*****
8. 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.
*****
22. Failure 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. 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.
Ariz. Admin. Code section R49108(A) provides that “A contractor shall perform all work in a professional and workmanlike manner.”
Ariz. Rev. Stat. subsection 32-1154(B)(3) provides that ROC “May temporarily suspend ... or permanently revoke any or all licenses issued under this chapter if the holder of the license ... commits any of the acts or omissions set forth in” subsection 32-1154(A).
Ariz. Rev. Stat. section 32-1154(E) provides that “The registrar may impose a civil penalty of not to exceed $500 on a contractor for each violation of [Ariz. Rev. Stat. 32-1154] subsection A, paragraph 22.”
The preponderance of the evidence shows that Complainant terminated her contract with Respondent in November 2021 before Respondent’s work was complete. The preponderance of the evidence also shows that the parties have a good-faith contract dispute related to both the original contract and the change orders that they agreed to. As such it has not been proven that Respondent violated Ariz. Rev. Stat. section 32-1154(A)(8).
Regarding Items 1, 7, and 8, ROC determined that Respondent’s work was deficient. But considering that these items had been corrected as of the March 11, 2022 compliance jobsite inspection, and that Complainant had terminated the contract with Respondent before Respondent had completed all of its work, it would not be fair or just to sustain a violation for these Items.
Regarding Items 2 and 5, ROC determined Respondent had not completed this work as of its January 19, 2022 jobsite inspection. This cannot fairly be considered a workmanship violation because Complainant terminated her contract with Respondent before Respondent could complete its work.
It has not been proven that Respondent violated Ariz. Rev. Stat. section 32-1154(A)(3).
It has not been proven that Respondent violated Ariz. Rev. Stat. section 32-1154(A)(22) because the three items for which ROC found the work to be deficient were corrected during the time allowed and the other two items were not workmanship violations but rather were work that was not completed because Complainant terminated her contract with Respondent before it could complete the work. Moreover, Complainant acknowledged that she did not pay the full third draw despite the concrete being installed, which was a breach of contract that occurred after ROC ordered Respondent to make corrections.
Considering the above, this matter should be dismissed.
RECOMMENDED ORDER
IT IS ORDERED that case number 2021-06063 is dismissed.
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.
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-137160-45720000Done this day, June 12, 2022.
/s/ Thomas Shedden
Thomas Shedden
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors
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-137160-45720000By Miranda Alvarez
Legal Secretary