ALJDEC decisions subject to certification as final

2022A-08151-NPC-ROC · Registrar of Contractors · 2023-01-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Arizona Painting Pros LLC,

COMPLAINANT

KYBA Building Group LLC

License No. ROC 298917,

RESPONDENT

No. 2022A-08151-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: December 20, 2022; thereafter, the hearing record was held open until December 23, 2022 for the parties to make submission of some additional documents they referenced at the hearing session.

APPEARANCES: Luis Viscarra represented Arizona Painting Pros LLC (“Complainant”). Oscar Galindo represented KYBA Building Group LLC (“Respondent”).

ADMINISTRATIVE LAW JUDGE: Kay Abramsohn

_____________________________________________________________________

FINDINGS OF FACT

1. Complainant performed its subcontracting services work on golf club/course projects for which Respondent had contracts with OB Sports.

2. As was its practice, Complainant sent before and after photographs of its completed work and then invoiced Respondent for Complainant’s services at the time each portion of the work was completed. Complainant also followed up with additional reminder invoices. Complainant’s work invoiced for July 2021 was paid by Respondent. However, Complainant’s work from September, October, and December of 2021, and from January and February of 2022 was not paid by Respondent.

3. After not being paid on the subject invoices and finding out that Respondent had been paid out by OB Sports, Complainant filed its Non-Payment Complaint Form (“Complaint”) with the Arizona Registrar of Contractors (“ROC”) alleging that Respondent failed to pay for the performed services on the thirteen specified invoices, which total an amount of receipts unpaid of $56,428.00.

4. Through its Citation and Complaint, the ROC alleged that Respondent may have violated Arizona Revised Statutes (“A.R.S.”) 32-1154(A)(10). The Citation further specified that if Respondent failed to file an answer, the failure to do so may be deemed to be an admission of the alleged act(s) with the result that ROC might suspend or revoke Respondent’s license.

5. Respondent’s answer to the ROC Citation and Complaint stated as follows:

The subcontractor was a forth part subcontractor that didn’t verify scope of work and did not complete the work at at jobsite each job should have been discussed with estimate in hand and did not the sub is submitting invoices that their own leisure, all work should have been preauthorized including cost which was not discussed, the subcontractor performed work at their own timing and will with out approval.

6. The matter was not resolved informally and proceeded to administrative hearing.

7. At hearing, Respondent argued that there had been problems with his payouts from OB Sports, mentioning that the “lump sum” checks were made out to Respondent and that he had expected the project manager would have figured out the payments to the various contractors. Respondent indicated that the subcontractors had been getting annoyed at not being paid. Respondent further argued that it had not been paid on a final payment.

8. Respondent stated that Complainant was brought into the projects by “Elite” which he stated was already a 3rd party to the contract. Respondent felt that, during the work, Respondent had no real feel for how these portions of the projects (being done by Complainant) would be done or completed.

9. At hearing, Respondent testified that, “about one year ago,” he was told that the final payout and change orders on the projects were not going to be paid.

10. At hearing, Complainant testified that he was told that Respondent was terminated from the project and also that Respondent had been paid out.

11. Post-hearing, Complainant provided documents obtained from the City of Tucson demonstrating that Respondent had been paid out on the projects.

12. Since the hearing date, neither party has advised the Tribunal that the instant matter was resolved informally.

13. As of the date of this decision, the ROC website indicates that Respondent has two open cases from 2022 filings (including the instant case) and had three cases from 2022 resolved. Additionally, Respondent was disciplined by ROC in 2021 on one case.

CONCLUSIONS OF 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. Arizona Administrative Code (“A.A.C.”) 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.” A.R.S. § 41-1092.07(G)(2).

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.” A.R.S. § 1-211(B).

The purpose of the ROC’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).

A.R.S. § 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: ....

10. Failure by a licensee or agent or official of a licensee to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee's operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.

8. The preponderance of the evidence shows that Respondent violated A.R.S. § 32-1154(A)(10) as alleged. Based upon Respondent’s violation of the provisions of A.R.S. § 32-1154(A)(10), grounds exist for the ROC to impose discipline against Respondent’s license.

RECOMMENDed order

Based on the foregoing, it is recommended that the ROC suspend Respondent’s ROC license No. ROC 298917 until Respondent has provided to the ROC, and the ROC has accepted, documentation that establishes that Respondent has paid Complainant $56,428.00 in certified funds.

It is further recommended that when and if the ROC receives and accepts Respondent’s documentation that it has paid Complainant in certified funds, the ROC may close the Complaint in Case No. 2022-08151.

In the event of certification of this 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 the certification.

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-137160-45720000Done this day, January 18, 2023.

/s/ Kay Abramsohn

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Registrar

Registrar of Contractors

Arizona Painting Pros LLC

[email redacted]

KYBA Building Group LLC

[email redacted]

By: OAH Staff

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-137160-45720000