ALJDEC decisions subject to certification as final

2022A-03776-CHC-ROC · Registrar of Contractors · 2022-10-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Bryan Staub,

COMPLAINANT

Phoenix Service Center Inc

DBA: Furniture Medic

License No. ROC 312448,

RESPONDENT

No. 2022A-03776-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: September 16, 2022

APPEARANCES: Complainant Bryan Staub appeared via Google Meet on his own behalf. Respondent Phoenix Service Center Inc. was represented by Bradley Pack, Esq. who appeared via Google Meet. Mark Nipp, Registrar of Contractors Investigator, appeared via Google Meet.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

_____________________________________________________________________

FINDINGS OF FACT

Phoenix Service Center Inc. (Respondent) was the holder of License No. 312448 issued by the Arizona Registrar of Contractors (Registrar).

On or about February 8, 2022 Bryan Staub (Complainant) signed a contract with Respondent for remodeling of a kitchen, laundry room, a bedroom and guest bathroom. The contract amount was for $36,900.00. Complainant paid $18,450.00.

On or about May 10, 2022, the Registrar received a Complaint alleging abandonment of the project.

The Registrar assigned the complaint to Investigator Mark Nipp. The jobsite inspection was performed on June 16, 2022. The Jobsite Inspection Notes state the following:

At the Jobsite Inspection, the complainant explained that their project was incomplete. The complainant further explained that the respondent had delivered materials for the project; however, they did not know the exact inventory of the materials or if they were correct.

The respondent agreed with the complainant and stated that his company had been forced to file bankruptcy and liquidate all their assets. The respondent stated he wanted to cooperate however he could, short of completing the work due to the liquidation of all his tools and equipment.

1. Compliance Item: In the final few weeks of the job to be completed, the contractor informed us that the company was filing for bankruptcy and ceasing to continue or complete all projects

Investigator’s Observation: Verified

I reviewed the contract and determined that the following was to be completed in the kitchen, laundry, guest bathroom, bedroom #2, and master bathroom:

• New shelves

• New doors

• New drawer fronts

• New applied side panels

• New dove tailed drawer boxes

• New under mount glides

• New soft close hinges

• Repair of previous bad install of edge banding

• Remove and replace kitchen light rail

• Kitchen – silverware double stack with slide drawer insert, double slide trash/recycle insert

• Laundry double slide dog food insert (similar to kitchen)

• Kitchen – crown molding to match master vanity center cabinet

• Laundry – crown molding

At the Jobsite Inspection the complainant explained that the respondent had taken (with their permission) the master vanity center cabinet in order to duplicate the crown molding. However, the cabinet was disassembled during the process and not returned (it was to be replaced).

I saw that there were no cabinet doors, drawer faces, drawer glides, cabinet hardware in the kitchen, laundry, guest bathroom, bedroom #2, or master bathroom. I noted there were shelves in the cabinets; however, the complainant explained they had to make those shelves themselves as a temporary measure while they waited for the new shelves from the respondent. I noted the light rail (p2) and edge banding had not been replaced.

The respondent agreed.

I inspected the materials that had been delivered by the respondent and noted that most of it was wrapped and I could not identify it. I did see there were cabinet hinges and what looked like drawer pulls (p11-17).

The respondent stated that all materials except the crown molding had been delivered and that most of the doors/drawer fronts had been painted.

The respondent should correct by appropriate means, pursuant to the contract, applicable building codes, and within the scope of their license.

Reference Picture(s) 2-24

Governing Rule: A.R.S. § 32-1154(A)(1) Abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.

(All errors contained in the original)

On June 24, 2022, the Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(1).

On or about August 3, 2022, a Notice of Hearing was issued setting a hearing on September 16, 2022 at the Office of Administrative Hearings, an independent state agency.

At hearing, Investigator Nipp testified to the above timeline and what Mr. Wooden stated about the condition of his business. Investigator Nipp testified that because of Mr. Wooden’s intention to not complete the job, he decided to forgo a written directive and proceed straight to a Citation.

Complainant testified that he paid the 50% deposit and no work was completed. He testified further that on or about May 3, 2022, Mr. Wooden sent him a letter stating he would not be able to complete the job because he was going to file bankruptcy.

Further, Complainant testified that Mr. Wooden told him that he would do everything possible to help find someone to finish the project, but he had no intention of finishing the work himself.

Mr. Wooden testified that his original business was helping to repair disaster projects. In early 2021, he went into business for new cabinet construction, however, due to the ongoing COVID-19 pandemic and the supply chain challenges, he was forced close his business.

Mr. Wooden testified that as of May 5, 2022, his eight team members were furloughed, and he had to sub-lease his building, and had no money until he sold his tools, equipment and vehicles. He also testified that he took a $200,000.00 loan and withdrew $25,000.00 from his 401(k).

In addition, Mr. Wooden testified that he did not intend to abandon the project, rather that he was physically unable to complete the Staub’s project because he had no workers, equipment, vehicles nor a facility to fabricate the cabinets. He testified further that if it were not for the financial distress he would have completed the project.

Finally, Mr. Wooden testified that he contacted two other contractors to try to help on the Staub’s project, but one did not want to get involved with possible legal matters and the other contractor stated that it was not logistically possible to help the Staubs.

Administrative notice is taken of Respondent’s prior License record on September 30, 2022. Such prior License record reflects that Respondent’s License No. 312448 was first issued on April 6, 2017, and reflects that there was 1 open complaint, namely the present complaint.

CONCLUSIONS OF LAW

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

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).

The preponderance of the evidence established that Respondent accepted the deposit and failed to complete the work on the project. While much of the hearing focused on the general definition of “abandon”, A.R.S. § 32-1154(A)(1) clearly states, “abandonment or refusal to perform” the project unless there is a legal excuse (emphasis added). In this case, the preponderance of the evidence showed, and Mr. Wooden admitted, that he refused to perform on the project. Only contacting two contractors does not appear to demonstrate a significant attempt to truly help the Staubs. The tribunal is not persuaded that financial distress is a legal excuse, rather it was a choice Mr. Wooden made to liquidate his work assets. Further, Mr. Wooden could have also used some of the loan money to reimburse the Staubs or make a payment plan to at least help the Staubs recover the down payment. There was no evidence that this occurred and therefore, Complainant established that Respondent abandoned in violation of A.R.S. § 32-1154(A)(1).

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. 312448.

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 30 days from the date of that certification.

-54864001

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-137160-45720000Done this day, October 3, 2022.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

Phoenix Service Center

c/o Bradley Pack

[email redacted]

Bryan Staub

[email redacted]

By Miranda Alvarez

Legal Secretary -54864001

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-137160-45720000