ALJDEC decisions subject to certification as final

2022A-04949-RFA-LS-ROC · Registrar of Contractors · 2023-10-30

Ricky Wheelington and

Ana Nemer

COMPLAINANTS

MH Project Consultancy LLC

DBA: Qualizona Construction,

License No. ROC 326537,

RESPONDENT

No. 2022A-04949-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: October 3, 2023 and October 10, 2023

APPEARANCES: Maxwell T. Riddiough, Esq. represented Complainant Ricky Wheelington and Ana Nemer. Mohamed Hassan represented Respondent MH Project Consultancy, LLC DBA: Qualizona Construction.

ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson

_____________________________________________________________________

FINDINGS OF FACT

1. On or about August 24, 2023, the Arizona Registrar of Contractors (Registrar) issued a Notice of Hearing setting the above-entitled matter for hearing on October 3, 2023. The Notice of Hearing provided that the issue set for determination was Respondent MH Project Consultancy LLC DBA: Qualizona Construction’s appeal to “the Registrar’s determination regarding Ricky Wheelington and Ana Nemer’s Recovery Fund Claim.”

2. A hearing was held on October 3, 2023 and October 10, 2023. The Registrar presented the testimony of Doug Ulmer, Legal Assistant at the Registrar. Complainant Ana Nemer testified on behalf of herself. Respondent presented the testimony of its member, Mohamed Hassan.

3. On July 17, 2023, the Registrar issued a Notice of Administrative Award (Notice) to Complainants Ricky Wheelington and Ana Nemer. The Notice provided that the Residential Contractors’ Recovery Fund determined that Complainants were eligible to a payout in the amount of $30,000.

4. Respondent submitted a request for a hearing regarding the Notice.

5. The Notice provided, in relevant part, as follows:

Pursuant to A.R.S. § 32-1132.01(B) an award from the Fund is limited to the actual damages suffered by the claimant as a direct result of the contractor’s violation. “Actual damages” may not exceed an amount necessary to complete or repair a residential structure or appurtenance within the residential property lines. A.R.S. § 32-1132.01(B)(1). Additionally, actual damages must be established by bids supplied by or the value of work performed by a person or entity that is licensed to perform construction work if the person is required to be licensed under A.R.S. § 32-1132.01(B)(2). In order to determine actual damages, the Fund must be able to verify, among other things, the actual contract price and all payments made on the contract and, if applicable, any unpaid balance due on the contract.

“Actual Damages” Calculation Summary:

Original contract price: $153,672.00

Less payment on contract: $107,569.00

Total unpaid balance - $46,103.00

Total Compensable Bid(s) Amount $115,200.00

Less the unpaid balance on contract: - $46,103.00

Compensable “Actual Damages”: $30,000.00

6. On or about September 8, 2021, Complainant Richard Wheelington entered into a contract with Respondent for an addition and remodel of his existing home for a total contract price of $153,672.00. The contract provided that the project would reach substantial completion in 60 to 90 days after the project began.

7. On or about June 17, 2022, Complainant filed a Complaint against Respondent with the Registrar.

8. After receiving the Complaint, Registrar Investigator Manny Bermudez conducted a job-site inspection.

9. On July 29, 2022, the Registrar issued a Directive to Respondent directing Respondent to correct complaint items by appropriate means, no later than August 23, 2023.

10. On September 7, 2022, the Registrar issued a Citation to Respondent alleging that Respondent violated Arizona Revised Statutes (A.R.S.) § 32-1154(A)(2)(a); A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A); A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158; A.R.S. § 32-1154(A)(16); and A.R.S. § 32-1154(A)(22).

11. A hearing was conducted on December 8, 2022 regarding the Complaint and Citation.

12. Respondent was represented by its qualifying party at the hearing.

13. On or about December 28, 2022 Administrative Law Judge Tammy Eigenheer issued a Recommended Decision to the Registrar concluding that Respondent did not complete the project in accordance with the plans without Complainant's consent in a manner that was prejudicial to Complainant, in violation of A.R.S. § 32-1154(A)(2)(a).

14. Judge Eigenheer further concluded through the Recommended Decision that Respondent violated A.R.S. § 32-1154(A) (3), namely A.A.C. R4-9-108(A); A.R.S. § 32-1154(A) (12), namely A.R.S. § 32-1158; A.R.S. § 32-1154(A) (16); and A.R.S. § 32-1154(A) (22).

15. The Registrar accepted Judge Eigenheer’s Recommended Decision.

16. On or about March 29, 2023, Complainant filed a request for a payout from the Registrar’s recovery fund.

17. Complainants submitted bids from Campa Construction, LLC to repair the deficient work that totaled $115,200.00. The contract price was $153,672.00. Complainant paid $107,569.00 to Respondent for construction. The Registrar determined that Complainant’s actual damages were $30,000.

18. Mr. Ulmer explained at hearing that the Registrar accepted the bid from Campa Construction although it included items that were not listed in the Directive because Judge Eigenheer concluded that Respondent failed to complete the project according to the original plans. The bid included the items that were listed in the contract and plans.

19. At hearing, Mr. Hassan contended that the award amount was excessive because some of the items included in the bid were not in the contract. Furthermore, many of the items, including the cabinetry, were not included in the Directive.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Ariz. Rev. Stat. § 32-1132(A) provides that “[a]n award from the fund is limited to the actual damages suffered by the claimant as a direct result of the contractor's violation but shall not exceed an amount necessary to complete or repair a residential structure or appurtenance within residential property lines. . . .” Respondent bears the burden of proof to establish that the proposed payout from the Fund is incorrect 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.”

After review of all the evidence, the Tribunal concludes that the award provided by the Fund is an accurate reflection of Complainants’ actual damages. The Registrar properly calculated Complainant’s actual damages based on the amount of the lowest bid from Campa Construction, $115,200.00.

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, October 30, 2023.

/s/ Velva Moses-Thompson

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

By: OAH Staff