ALJDEC decisions subject to certification as final

2022A-10138-OMC-LS-ROC · Registrar of Contractors · 2022-11-28

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Arizona Registrar of Contractors,

COMPLAINANT

OMG Custom Creations, LLC

License No. ROC 335728,

RESPONDENT

No. 2022A-10138-OMC-LS-ROC

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: November 14, 2022

APPEARANCES: Assistant Attorney General Justin Larson represented Complainant Arizona Registrar of Contractors. Robert Stirling, Assistant Chief Counsel, and Investigator Jason Simpson appeared as witnesses for the Arizona Registrar of Contractors. Bernardo Ortega appeared on behalf of Respondent OMG Custom Creations, LLC. Chris Ortega appeared as a witness for OMG Custom Creations, LLC.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

FINDINGS OF FACT

Background and Procedure

On November 29, 2021, the Arizona Registrar of Contractors (“Registrar”) issued License No. 335728, a KB-2 Dual General Residential and Small Commercial contractor license to OMG Custom Creations, LLC (“Respondent”). Bernardo Ortega III is Respondent’s Qualifying Party and a Member.

On November 3, 2022, the Registrar issued an Order of Summary Suspension and Notice of Promptly Instituted Proceedings (“Order”) setting the above-captioned matter for an expedited hearing at 9:00 a.m. on November 14, 2022, before the Office of Administrative Hearings. In the Order, the Registrar presented its determination that the public health, safety or welfare imperatively required emergency action and summarily suspended Respondent’s license pending proceedings for revocation or other action.

On November 8, 2022, the Registrar issued a Supplemental Notice and Second Order Of Consolidation to clarify and detail the specific charges against Respondent.

Hearing Evidence

Bernardo Ortega appeared on behalf of Respondent. Chris Ortega appeared as a witness for Respondent. The Registrar called witnesses Robert Stirling, Assistant Chief Counsel for the Registrar, and Investigator Jason Simpson.

During a period of approximately three months, the Registrar received eight (8) complaints against Respondent which were consolidated into this single proceeding, all alleging various violations of this State’s contracting laws.

Stephanie Blanco Complaint No. 2021-05533

The Registrar received a Complaint against Respondent filed by Stephanie Blanco. In her Complaint, Ms. Blanco alleged abandonment with regard to the pool construction project undertaken by Respondent.

Ms. Blanco’s Complaint indicates that the contract price was $47,000.00 and that she paid Respondent $43,050.00.

Upon review of the parties’ contract, Investigator Simpson observed that the contract failed to contain the required minimum elements of a contract required by Ariz. Rev. Stat § 32-1158.01, specific to swimming pool construction. On July 15, 2022, Investigator Simpson issued a Warning Letter to Respondent.

Also on July 15, 2022, Investigator Simpson issued another Warning Letter to Respondent for working outside the scope of its license as its KB-2 license classification does not encompass pool construction.

On September 8, 2022, Investigator Simpson conducted a jobsite inspection. Both Bernardo Ortega and Chris Ortega were present for the jobsite inspection. Investigator Simpson inspected the work that had been done on the project and took photographs of the project. Investigator Simpson documented his findings in his Jobsite Inspection Notes. Investigator Simpson found that Respondent had performed poor work.

After the jobsite inspection, the parties attempted to resolve the matter. Consequently, the Registrar issued a closure letter.

Notwithstanding its agreement to do so, Respondent failed to resolve the matter with Ms. Blanco.

On October 3, 2022, Investigator Simpson issued a WRITTEN Directive from the Registrar to Respondent due to the deficiencies he found with regard to Respondent’s work on the project. Respondent was put on notice that it had until October 21, 2022, to notify the Registrar of its compliance with the WRITTEN Directive or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1154(E).

On October 31, 2022, the Registrar issued a Citation against Respondent charging Respondent with violations of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(a), Ariz. Rev. Stat. § 32-1154(A)(8), Ariz. Rev. Stat. § 32-1154(A)(12), namely Ariz. Rev. Stat. § 32-1158, and Ariz. Rev. Stat. § 32-1154(A)(22)

At hearing, Investigator Simpson testified consistently with the above-delineated findings of fact. Investigator Simpson testified that the pool is not completed, there was a “hole with rebar,” that the parties came to an agreement at the jobsite inspection to work together, however, the pool is still not complete and Respondent performed no work as agreed upon. Investigator Simpson also testified that Respondent did not obtain a permit to start the construction of the pool, that no inspections have been performed by the city, and that the city is not even aware of the pool construction. Investigator Simpson further testified regarding the workmanship issues, including “obvious deterioration,” discolored pipes, the presence of debris, no electrical work was completed, and the dimensions of the pool are incorrect. Investigator Simpson referenced photographs taken at the jobsite inspection to illustrate the workmanship deficiencies. Investigator Simpson testified that Respondent failed to comply with the Written Directive.

Investigator Simpson testified that he issued a Warning Letter to Respondent because the work performed by Respondent requires a pool contractor license, and Respondent does not possess that license classification and the scope of Respondent’s license does not encompass pool construction.

Myrna Aredondo Complaint No. 2022-05534

The Registrar received a Complaint against Respondent filed by Myrna Aredondo. In her Complaint, Ms. Aredondo alleged poor work with regard to the pool construction project undertaken by Respondent.

Ms. Aredondo’s Complaint indicates that the contract price was $55,000.00 and that she paid Respondent $42,625.00.

Upon review of the parties’ contract, Investigator Simpson observed that the contract failed to contain the required minimum elements of a contract required by Ariz. Rev. Stat. § 32-1158.01, specific to swimming pool construction. On July 15, 2022, Investigator Simpson issued a Warning Letter to Respondent.

Also on July 15, 2022, Investigator Simpson issued another Warning Letter to Respondent for working outside the scope of its license as its KB-2 license classification dies not encompass pool construction.

On September 8, 2022, Investigator Simpson conducted a jobsite inspection. Mr. Bernardo Ortega was present for the jobsite inspection. Investigator Simpson inspected the work that had been done on the project and took photographs of the project. Investigator Simpson documented his findings in his Jobsite Inspection Notes. Investigator Simpson found that Respondent had performed poor work.

On September 16, 2022, Investigator Simpson issued a WRITTEN Directive from the Registrar to Respondent due to the deficiencies he found with regard to Respondent’s work on the project. Respondent was put on notice that it had until October 4, 2022, to notify the Registrar of its compliance with the WRITTEN Directive or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1154(E).

On October 13, 2022, the Registrar issued a Citation against Respondent charging Respondent with violations of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(a), Ariz. Rev. Stat. § 32-1154(A)(8), Ariz. Rev. Stat. § 32-1154(A)(12), namely Ariz. Rev. Stat. § 32-1158, and Ariz. Rev. Stat. § 32-1154(A)(22)

At hearing, Investigator Simpson testified consistently with the above-delineated findings of fact. Investigator Simpson testified that the pool was “red-tagged” by the city, that the shotcrete was not installed correctly, that it is cracking, and that the city inspector stated that the pool as constructed will not support the pressure of the water once filled, and the pool is incomplete. Investigator Simpson further testified that Respondent failed to comply with the Written Directive.

Flor Rios Complaint No. 2022-05552

The Registrar received a Complaint against Respondent filed by Flor Rios. In her Complaint, Ms. Rios alleged abandonment and poor work with regard to the pool construction project undertaken by Respondent.

Ms. Rios’ Complaint indicates that the contract price was $60,000.00 and that she paid Respondent $36.000.00.

On September 8, 2022, Investigator Simpson conducted a jobsite inspection. Bernardo Ortega was present for the jobsite inspection. Investigator Simpson inspected the work that had been done on the project and took photographs of the project. Investigator Simpson documented his findings in his Jobsite Inspection Notes. Investigator Simpson found that Respondent had performed poor work.

On September 19, 2022, Investigator Simpson issued a WRITTEN Directive from the Registrar to Respondent due to the deficiencies he found with regard to Respondent’s work on the project. Respondent was put on notice that it had until October 6, 2022, to notify the Registrar of its compliance with the WRITTEN Directive or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1154(E).

On October 14, 2022, the Registrar issued a Citation against Respondent charging Respondent with violations of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(a), Ariz. Rev. Stat. § 32-1154(A)(8), Ariz. Rev. Stat. § 32-1154(A)(12), namely Ariz. Rev. Stat. § 32-1158 and Ariz. Rev. Stat. § 32-1158.01, and Ariz. Rev. Stat. § 32-1154(A)(22)

At hearing, Investigator Simpson testified consistently with the above-delineated findings of fact. Investigator Simpson testified that Respondent followed the same pattern and practice and had the same issues as the previously delineated Complaints. Specifically, there was either no permit for this project, or the permit had expired, and there was incomplete and poor work. Investigator Simpson testified that this project was to be completed in May 2022, and that it had not been completed by the time of the jobsite inspection in September 2022, and that Respondent failed to comply with the Written Directive.

Sandra Sumas Complaint No. 2022-08016

The Registrar received a Complaint against Respondent filed by Sandra Sumas. In her Complaint, Ms. Sumas alleged abandonment with regard to the pool construction project undertaken by Respondent.

Ms. Sumas’ Complaint indicates that the contract price was $81,000.00 and that she paid Respondent $40,000.00.

Upon review of the parties’ contract, Investigator Simpson observed that the contract failed to contain the required minimum elements of a contract required by Ariz. Rev. Stat. § 32-1158.01, specific to swimming pool construction. On November 4, 2022, Investigator Simpson issued a Warning Letter to Respondent.

Also on November 4, 2022, Investigator Simpson issued another Warning Letter to Respondent for working outside the scope of its license as its KB-2 license classification does not encompass pool construction.

On November 4, 2022, Investigator Simpson issued another Warning Letter to Respondent for failing to obtain a permit for the project.

On October 12, 2022, Investigator Simpson conducted a jobsite inspection. Bernardo Ortega was present for the jobsite inspection. Investigator Simpson observed that work had not commenced on the project, that there was no permit, and that there was not even a permit application on file with the city.

At hearing, Investigator Simpson testified consistently with the above-delineated findings of fact. Investigator Simpson testified that the parties contracted for Respondent to construct a pool and outdoor kitchen, Ms. Sumas paid a substantial sum of money to Respondent, and Respondent had not even obtained the required permits and had not broken ground on the project. Respondent followed the same pattern and practice and had the same issues as the previously delineated Complaints.

Orazio Roger Saverino Complaint No. 2022-08101

The Registrar received a Complaint against Respondent filed by Orazio Roger Saverino. Mr. Saverino contracted with Respondent for the construction of a pool, however, Respondent did not commence construction notwithstanding the fact that Mr. Saverino paid a substantial deposit to Respondent. In his Complaint, Mr. Saverino alleged that he entered into an agreement with Respondent pursuant to which Respondent was to refund in full all monies paid to Respondent by Mr. Saverino for the construction of the pool.

Mr. Saverino’s Complaint indicates that the contract price was $74,000.00 and that he paid Respondent $11,000.00.

The parties entered into a Cancellation Agreement, dated August 22, 2022, whereby Respondent was to reimburse Mr. Saverino $11,100.00 within fourteen (14) business days of the agreement. Mr. Saverino and Bernard Ortega signed and dated the agreement on August 22, 2022.

Based on the parties’ agreement, the Registrar issued a Dismissal Letter on September 23, 2022.

Investigator Simpson testified that the Registrar reopened Mr. Saverino’s Complaint due to Respondent’s failure to abide by the parties’ agreement and due to the pattern of Respondent’s “abandonment and fraudulent activity.”

Daniel Erickson Complaint No. 2022-07994

The Registrar received a Complaint against Respondent filed by Daniel Erickson. In his Complaint, Mr. Erickson alleged that Respondent abandoned a commercial project in which Respondent was to install 10,500 square feet of curbing along a race track at the Podium Club.

Mr. Erickson’s Complaint indicates that the contract price was $82,000.00 and that he paid Respondent $35,000.00.

On September 23, 2022, the Registrar issued a Dismissal Letter based upon the fact that the parties’ dispute was financial in nature and because the Registrar determined that Respondent’s work on the project had been modified.

After further investigation, Mr. Erickson’s Complaint was re-opened.

Tracy Smith Complaint No. 2022-08605

The Registrar received a Complaint against Respondent filed by Tracy Smith. In her Complaint, Ms. Smith alleged abandonment with regard to the pool construction and installation of a patio cover project undertaken by Respondent.

Ms. Smith’s Complaint indicates that the contract price was $55,000.00 and that she paid Respondent $31,625.00.

On November 2, 2022, Investigator Simpson conducted a jobsite inspection. Respondent did not attend the jobsite inspection. Investigator Simpson inspected the work that had been done on the project and took photographs of the project. Investigator Simpson documented his findings in his Jobsite Inspection Notes. Investigator Simpson found that Respondent had not obtained the proper permits, the work was not completed, and Respondent caused damage to Ms. Smith’s property.

Investigator Simpson testified that it is unusual to have as many complaints of such an egregious nature filed against a single contractor in such a short period of time.

Robert Stirling, Assistant Chief Counsel for the Registrar, testified regarding Case Number 2022-08080 filed by Daniel Lopez. Mr. Lopez had contracted with Respondent to construct a pool. The contract price was $81,000.00 and Mr. Lopez paid Respondent $20,325.00.

The parties entered into a Cancellation Agreement, dated August 22, 2022, whereby Respondent was to reimburse Mr. Lopez $20,325.00 within fourteen (14) business days of the agreement. Mr. Lopez and Bernardo Ortega signed and dated the agreement on August 22, 2022.

Respondent did not refund Mr. Lopez nor did Respondent perform any work on the project.

Mr. Lopez filed a Complaint with the Registrar against Respondent.

Mr. Stirling explained that it is not common for the Registrar to become involved in financial disputes, however, in light of Respondent’s pattern of failing to perform and defrauding homeowners by entering into settlement agreements promising to repay monies to homeowners and failing to do so, the Registrar became involved.

Mr. Stirling testified regarding the Order of Summary Suspension and the alleged violations therein, as well as the Supplements thereto and the alleged violations therein. Mr. Stirling testified that the Registrar received eight complaints against Respondent in a three month period which is significant for a small contractor. Further, the nature of the complaints, including abandonment, fraud, a lack of permits, and contracting outside the scope of its license, caused the Registrar to issue an Order of Summary Suspension as it determined a threat to the public welfare existed.

Bernardo Ortega testified regarding the Stephanie Blanco Complaint. Mr. Ortega testified that Respondent pulled the permits and the project passed inspections. Mr. Ortega blamed the shotcrete issues on shortages, and delays on the project on the monsoon season, asserting that the “ground was destroyed by rain.” Mr. Ortega asserted that Respondent’s “work was satisfactory.”

Regarding the Aredondo Complaint, Mr. Ortega testified that a “small portion of the shotcrete had to be re-poured and that the engineering report “shows that the pour was fine.” Mr. Ortega testified that he “thought he sent the report to Investigator Simpson” and that the “report said it was an acceptable method.” Mr. Ortega did not provide any documentation establishing his assertion.

Regarding the Rios Complaint, Mr. Ortega testified that the “permits were pulled and all work was satisfactory, but they never got to finish so no inspections.” Mr. Ortega asserted that Ms. Rios “did not like any workers so it took a long time to find other workers.”

Mr. Ortega testified as to the Smith Complaint, that the city required an alternate plot plan and that he has documentation demonstrating that the permit was obtained for the pool. However, Mr. Ortega did not provide any documentation establishing his assertion. Mr. Ortega contended that a permit was not required for the patio cover. Mr. Ortega testified that he did not call for inspections due to the filed Complaint.

As to the Complaints concerning a breach of the Cancellation Agreement, Mr. Ortega explained that it was “the perfect storm” and that the filed Complaints put Respondent “in a bind” and Respondent did not have the funds to repay the monies. Mr. Ortega testified that Respondent would make the required payments, however, “it will take a little bit longer” because there are “three people that want money back and he gave to four others.”

Regarding the Sumas Complaint, Mr. Ortega testified that he did not pull the permits because he was not yet ready for them.

Mr. Ortega testified that Respondent is suing Mr. Erickson for funds that Respondent believes are due and owing to Respondent, and that Mr. Erickson contacted Respondent’s customers and urged them to file complaints in retaliation.

Mr. Ortega acknowledged that Respondent did not provide a list of its subcontractors to Investigator Simpson, but asserted that Respondent is in possession of the list. Mr. Ortega asserted that not many subcontractors want to travel to the area to work. Mr. Ortega denied defrauding customers, stating that the customers paid to the point of the current status of their projects, with the exception of Ms. Blanco’s project.

Chris Ortega’s testimony was similar to that of Mr. Ortega regarding the shotcrete shortage and regarding the dispute with Mr. Erickson.

Administrative Notice is taken of Respondent’s prior License record for License No. 335728, as reflected on the Registrar’s public website on November 22, 2022. Such prior License record reflects that Respondent’s license is currently suspended and has been suspended since November 3, 2022. The record also reflects that there are five open complaints against Respondent’s license, all of which are presumed to be related to this matter, zero complaints resulting in discipline, and zero resolved/settled complaints. Respondent has an active surety bond that was issued through Merchants Bonding Company effective November 19, 2021, of which $14,000.00 remains available.

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 the Office of Administrative Hearings 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.

“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.”

Respondent’s suspended license does not deprive Complainants of their right to prosecute the Complaints or prevent the Registrar from determining the merits of the Complaints.

The Registrar 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.

The standard of proof on all issues in this matter is that of 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.”

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)(1) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.”

Ariz. Rev. Stat. § 32-1154(A)(2) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license:

Departure from or disregard of:

(a) Plans or specifications in any material respect that is prejudicial to another without consent of the owner or the owner's duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.

(b) A building code of this state or any political subdivision of this state in any material respect that is prejudicial to another.

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. Rev. Stat. § 32-1154(A)(6) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[t]he doing of a fraudulent act by the licensee as a contractor resulting in another person being substantially injured. For the purposes of this paragraph, "fraudulent act" means a material misrepresentation that a licensee makes, that is relied on by another person and that results in damage to that person or that person's property.”

Ariz. Rev. Stat. § 32-1154(A)(8) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure 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.”

Ariz. Rev. Stat. § 32-1154(A)(12) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” Ariz. Rev. Stat. § 32-1158(A) provides:

Any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved shall contain in writing at least the following information:

1. The name of the contractor and the contractor's business address and license number.

2. The name and mailing address of the owner and the jobsite address or legal description.

3. The date the parties entered into the contract.

4. The estimated date of completion of all work to be performed under the contract.

5. A description of the work to be performed under the contract.

6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes.

7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner.

8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract.

9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar's telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A. The information in this paragraph must be prominently displayed in the contract in at least ten point bold type, and the contract shall be signed by the property owner and the contractor or the contractor's designated representative. This paragraph does not apply to a person who is subject to and complies with section 12-1365.

Ariz. Rev. Stat. § 32-1158.01 provides:

In addition to the requirements of section 32-1158, a licensed contractor who enters into a contract for the construction or installation of a residential in-ground swimming pool or spa with a purchaser who resides in the residence or who intends to reside in the residence after the completion of the contract shall include at least the following provisions:

A provision providing the purchaser the opportunity to request standard contractor's payment and performance bonds in a form approved by the registrar, securing the completion of the work and payment for services and materials. The cost of the payment and performance bond shall be paid by the purchaser of the swimming pool or spa and the contractor shall not charge a surcharge or a service charge.

The following payment provisions:

(a) A down payment payable on the execution of the contract of not more than fifteen percent of the original contract price.

(b) After the completion of the excavation work on the swimming pool or spa, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(c) After the installation of steel, plumbing and pneumatically applied concrete materials or the installation of a prefabricated swimming pool or spa, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(d) After the installation of decking materials, a payment of not more than twenty-five percent of the amount of the original contract price plus any written change orders approved by the purchaser.

(e) Before the application of the finishing interior materials or completion of all work on a prefabricated pool or spa, payment of all remaining sums due on the original contract plus any written change orders approved by the purchaser.

A provision that gives notice to the purchaser, in a form that is approved by the registrar and that is in at least ten point type, of the purchaser's right to receive written material that advises the purchaser of the provisions of this section and of the procedures provided for by the registrar for the resolution of claims and disputes with licensed contractors.

4. A provision in a form that is approved by the registrar and that is in at least ten point type, advising the purchaser of the purchaser's rights under title 44, chapter 15.

If a purchaser requires the contractor to furnish a payment and performance bond securing the performance of the contract, the contract provisions required by subsection A, paragraph 2 of this section may be changed in any manner agreed to by the parties to the contract.

Any changes, additions or deletions to the work specified in the original contract shall be included in a written change order.

D. A contractor's failure to comply with this section is a violation of section 32-1154, subsection A.

Ariz. Rev. Stat. § 32-1154(A)(16) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.”

Ariz. Rev. Stat. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure 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.”

It is undisputed that Respondent entered into pool construction contracts with Ms. Blanco, Mr. Lopez, Mr. Saverino, Ms. Aredondo, Ms. Rios, Ms. Sumas, and Ms. Smith, and a concrete installation contract with Mr. Erickson, and that Respondent did not complete those projects, and in some cases, did not commence the projects, or perform its work in a professional and workmanlike manner. Moreover, Respondent was not licensed to perform pool construction.

Regarding the Blanco project, the record establishes that Respondent contracted with Ms. Blanco to construct a pool, received monies from Ms. Blanco for that purpose, and thereafter did not obtain the required permits, did not complete the project, and performed its work poorly. The record further establishes that Respondent failed to comply with a Written Directive from the Registrar and its contract failed to contain the minimum elements required for contracts. Further, Respondent contracted beyond the scope of its license.

Regarding the Lopez project, the record establishes that Respondent contracted with Mr. Lopez to construct a pool, Respondent abandoned the project after Respondent received monies from Mr. Lopez, entered in a Cancellation Agreement agreeing to reimburse Mr. Lopez the funds he paid to Respondent within fourteen (14) business days, and has yet to do so. Therefore, the record establishes that Respondent made a material misrepresentation relied upon by Mr. Lopez that resulted in damage to Mr. Lopez, namely the deprivation of the use of those funds.

Regarding the Aredondo project, the record establishes that Respondent contracted with the Aredondos to construct a pool, received monies from the Aredondos for that purpose, and thereafter the project was red-tagged by the city for code violations, Respondent did not complete the project, and performed its work poorly. The record further establishes that Respondent failed to comply with a Written Directive from the Registrar and its contract failed to contain the minimum elements required for contracts. Further, Respondent contracted beyond the scope of its license.

Regarding the Rios project, the record establishes that Respondent contracted with Ms. Rios to construct a pool, received monies from Ms. Rios for that purpose, did not obtain the required permits or was utilizing an expired permit, did not complete the project, and performed its work poorly. The record further establishes that Respondent failed to comply with a Written Directive from the Registrar and its contract failed to contain the minimum elements required for contracts. Further, Respondent contracted beyond the scope of its license.

Regarding the Sumas project, the record establishes that Respondent contracted with Ms. Sumas to construct a pool and outdoor kitchen, received monies from Ms. Sumas for that purpose, did not obtain the required permits, did not complete the project, and performed its work poorly. The record further establishes that Respondent’s contract failed to contain the minimum elements required for contracts. Further, Respondent contracted beyond the scope of its license.

Regarding the Smith project, the record establishes that Respondent contracted with Ms. Smith to construct a pool and install a patio cover, received monies from Ms. Smith for that purpose, did not obtain the required permits, did not complete the project, and performed its work poorly, including damage to the property. Further, Respondent contracted beyond the scope of its license.

Regarding the Saverino project, the record establishes that Respondent contracted with Mr. Saverino to construct a pool, abandoned the project after Respondent received monies from Mr. Saverino, entered in a Cancellation Agreement agreeing to reimburse Mr. Saverino the funds he paid to Respondent within fourteen (14) business days, and has yet to do so. Therefore, the record establishes that Respondent made a material misrepresentation relied upon by Mr. Saverino that resulted in damage to Mr. Saverino, namely the deprivation of the use of those funds.

The evidence of record established that the Erickson Complaint is still in the investigative stage.

Because the Registrar established by a preponderance of the evidence that Respondent violated this State’s contracting laws as set forth above, the Registrar has also established cause for it to take disciplinary action against Respondent’s contractor license.

Considering Respondent’s conduct in these matters, the Registrar’s Order of Summary Suspension shall be affirmed to ensure the protection of the public’s welfare.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that on the effective date of the Final Order in this matter, the November 3, 2022 Order of Summary Suspension, finding that the public welfare imperatively requires emergency action with respect to OMG Custom Creations, LLC’s License No. 335728, be affirmed in accordance with Ariz. Rev. Stat § 41-1092.11(B).

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.

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-137160-45720000Done this day, November 28, 2022.

/s/ Sondra J. Vanella

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

[email redacted]

OMG Custom Creations, LLC

[email redacted]

Justin Larson

Office of the Attorney General

[email redacted]

By Miranda Alvarez

Legal Secretary

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-137160-45720000