ALJDEC - Licensing
2023A-00534-CHC-ROC · Registrar of Contractors · 2023-08-07
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Molly Schulz,
COMPLAINANT,
v.
Engrained Cabinetry and Countertops LLC
ROC License No. 265845,
RESPONDENT.
No. 2023A-00534-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: July 28, 2023 at 1:00 PM.
APPEARANCES: Molly Schulz (“Complainant”) appeared on her own behalf. Chris Allison appeared on behalf of the Arizona Registrar of Contractors (“Registrar”). Thomas Corkery appeared on behalf of Engrained Cabinetry and Countertops LLC (“Respondent”). Paul Dankowski observed.
ADMINISTRATIVE LAW JUDGE: Jenna Clark.
_____________________________________________________________________
After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Recommended Order to the Director of the Registrar.
FINDINGS OF FACT
Background and Procedure
Pursuant to Arizona Administrative Code (“Ariz. Admin. Code”) R4-9-117, Administrative Notice is taken of Respondent’s prior license record as reflected on the Registrar’s public website. On June 12, 2010, the Registrar issued License No. 265845 Specialty Dual CR-60 Finish Carpentry contracting license to Respondent. The license is renewed through June 30, 2024. Thomas Anthony Corkery is listed as the Qualifying Party and Member on the license. Toni Marie Corkery and Brian Joseph Bedard are also listed as Members on the license. Respondent’s address of record for the license is 6690 Inter-Cal Way Prescott, AZ 86301. Respondent has an active $6,750.00 surety bond on the license issued by Ohio Casualty Insurance Company, effective April 01, 2013, and a $1,000.00 surety bond issued by Nationwide, effective May 21, 2010. The license no prior disciplinary record, save one (1) open complaint listed against the license which is presumed to be related to this matter.
On January 14, 2023, the Registrar received a narrative complaint from Complainant against Respondent’s License No. 265845 alleging poor work of their residential remodel project. The Registrar designated it Complaint No. 2023-005134 and assigned to Chris Allison (“Investigator Allison”) for investigation.
On January 20, 2023, Investigator Allison issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on February 15, 2023, at 2:00 p.m. Correspondence was not returned as undeliverable to Respondent.
On February 16, 2023, the Registrar received an 8-item narrative addendum complaint from Complainant.
On February 15, 2023, Complainant provided notice to the Registrar that she was unavailable for the scheduled jobsite inspection, because she was out of town through March 03, 2023. As a result, Investigator Allison issued a Notice of Rescheduled Jobsite Inspection Letter to the parties, advising that he would conduct an inspection of the project, including Complainant’s addendum items, on February 28, 2023, at 2:30 p.m. On February 17, 2023, Investigator Allison issued second Notice of Rescheduled Jobsite Inspection Letter to the parties, advising that the inspection was rescheduled to March 06, 2023, at 2:30 p.m.
On March 06, 2023, Investigator Allison inspected the work that had been performed on the project to date. Respondent was present. Investigator Allison also reviewed the contract-related correspondence between the parties, and took 16 photographs of the project site. When he was finished, Investigator Allison drafted his Inspection Notes. Ultimately, Investigator Allison derived three (3) separate and distinct complaint items from Complainant’s narrative submission to the Registrar, and substantiated 5 additional addendum items based on his firsthand observations. Specifically, Investigator Allison determined Respondent’s workmanship on complaint items 1, 3, 5-9, and 11 failed to meet the Registrar’s minimum standards and required Respondent to perform corrective and/or completion work to remediate the identified deficiencies.
On March 22, 2023, Investigator Allison issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated some of Complainant’s workmanship allegation(s) against Respondent. Respondent was put on notice that it had until 5:00 p.m. on April 09, 2023, to notify the Registrar of its compliance with the Directive or face discipline pursuant to Arizona Revised Statutes (“Ariz. Rev. Stat.”) §§ 32-1154(A) and 32-1154(E). Correspondence was not returned as undeliverable to Respondent.
On March 30, 2023, the Registrar received a second addendum complaint from Complainant, which contained 4 complaint items.
On April 07, 2023, Investigator Allison issued an Addendum Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on April 26, 2023, at 1:00 p.m.
On April 26, 2023, Investigator Allison inspected the four (4) addendum complaint items, identified as complaint items 12-15, of which, he substantiated each. Respondent was present. Specifically, Investigator Allison determined Respondent’s workmanship on addendum complaint items 12-15 failed to meet the Registrar’s minimum standards and required Respondent to perform corrective and/or completion work to remediate the identified deficiencies. Investigator Allison took 11 photographs.
On May 01, 2023, Investigator Allison issued an Amended Written Directive from the Registrar (“Amended Directive”) regarding the substantiation of Complainant’s addendum workmanship allegation(s) against Respondent. Respondent was put on notice that it had until 5:00 p.m. on May 16, 2023, to notify the Registrar of its compliance with the Amended Directive or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A) and 32-1154(E). Correspondence was not returned as undeliverable to Respondent.
On May 19, 2023, Investigator Allison forwarded the matter to the Registrar’s legal department with the issuance of a Citation Recommendation.
On June 08, 2023, the Registrar issued a Citation to Respondent for alleged violations of Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108(a), and 32-1154(A)(22). Respondent was given until June 23, 2023, to respond with its Answer or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1155. Correspondence was not returned as undeliverable to Respondent.
On June 21, 2023, the Registrar received Respondent’s timely Answer whereby Respondent argued that it made all reasonable efforts to complete the project, but was unable to do so due to quality, manufacturing, and appliance fitment issues. Per Respondent, it performed corrective work on May 16, 2023, and May 25, 2023, the latter of which it was only permitted to work for 2 hours and discovered items that needed to be replaced at that time. Respondent proffered that although the items had been ordered, as of the date of its Answer said items had not been delivered to Respondent. Though it did not offer an anticipated date of material delivery, Respondent opined that it would take 2-3 days to complete all outstanding corrective work on the project.
On June 23, 2023, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on July 28, 2023. Per the June 26, 2023, Notice of Hearing the issues to be determined are whether the Registrar has cause to discipline Respondent’s license based on the following alleged statutory violations:
Charge 1: A.R.S. § 32-1154(A)(3) – A.A.C. R4-9-108(a)
Charge 2: A.R.S. § 32-1154(A)(22)
Hearing Evidence
Complainant testified on her own behalf, called Investigator Allison as a witness, and submitted Exhibits 14-15. Respondent called Thomas Corkery as a witness. The Registrar’s agency file, supplemental file, and Notice of Hearing were admitted into the record as their own exhibits. The substantive evidence of record is as follows:
Complainant owns a residential property located at 1730 N. Blue Spruce Cir. Flagstaff, AZ 86001.
On or about July 05, 2022, the parties entered into a $38,895.43 verbal contract for the installation of custom cabinetry at Complainant’s residence.
Work on the project commenced on or about October 03, 2022, and stopped or was otherwise completed in January 2023.
Complainant paid Respondent in full on the project.
On May 19, 2023, Complainant confirmed with Investigator Allison that between March 22, 2023, and May 16, 2023, Respondent only addressed 1 of the substantiated complaint items at issue, and that the balance remained outstanding.
By the expiration of the Amended Directive’s compliance period, which Respondent did not request an extension of, the parties had not settled their underlying dispute.
Additional Evidence
On May 22, 2023, Respondent provided notice to Complainant that it would perform corrective work on May 25, 2023, from 8:00 a.m. until 10:00 a.m.
On May 25, 2023, Respondent performed corrective work past 11:19 a.m.
Closing Arguments
Both parties declined to provide closing arguments.
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 OAH 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.
The Registrar may resolve contractual disputes if such resolution in ancillary to its regulatory mission and may penalize a contractor’s license by ordering payment of restitution if a proven statutory violation was not remedied by corrective action.
Complainant bears the burden of proof to establish cause for the Registrar 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.
“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. 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. Admin. Code R4-9-108(a) requires that “[a] contractor shall perform all work in a professional and workmanlike manner.”
Ariz. Rev. Stat. § 32-1154(A)(22) provides, in pertinent part, that “[a] holder of a license may not fail to take appropriate corrective action to comply with this chapter or 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. The Registrar has the authority to issue license discipline under this provision, including summary suspension, revocation, or imposing a civil penalty or recovery fund award.
Ariz. Rev. Stat. § 32-1154(E) provides, in pertinent parts, that the Registrar may “[i]mpose a civil penalty not to exceed five hundred dollars on a contractor for each violation. The failure by the licensee to pay any civil penalty imposed results in the automatic revocation of the license thirty days after the effective date of the order providing for the civil penalty.” It also provides that “[n]o future license may be issued to an entity consisting of a person who is associated with the contractor, unless payment of any outstanding civil penalty is tendered.”
Statutes shall be liberally construed to affect their objects and to promote justice. In interpreting a statute, “[w]e first consider the language of the statute and, if it is unclear, turn to other factors, including ‘the statute’s context, subject matter, historical background, effects, consequences, spirit, and purpose.”
Statutes should be interpreted to provide a fair and sensible result. “In applying a statute its words are to be given their ordinary meaning unless the legislature has offered its own definition of the words or it appears from the context that a special meaning was intended.”
The Tribunal is required to apply equitable principles when rendering decisions. The application of equity entails offering a remedy to avoid an unconscionable or unjust result.
The material facts in the case at bar are not in dispute.
The record reflects that the parties had a custom cabinetry contract that Complainant paid in full, which Respondent did not complete per the Registrar’s minimum workmanship standards. The record further reflects that Respondent did not complete corrective work in accordance with the Amended Directive.
Therefore, the only issue in dispute is whether Respondent raised a sufficient justification or excuse for failing to settle its underlying dispute with Complainant in compliance with the Registrar’s Amended Directive. This is an affirmative defense that Respondent bears the burden to establish. The Tribunal is not at liberty to make presumptions in favor of Respondent or accept facts in mitigation on behalf of Respondent that are not supported by the evidence. Here, a detailed analysis is not necessary. Mr. Corkery’s assertion that Respondent was unable to complete corrective work due to lack of materials is insufficient. The record reflects that Mr. Corkery did not attempt to perform any corrective work until May 16, 2023, the last day of the Addendum Directive, and did not make the discovery regarding missing necessary materials until May 25, 2023. The record further establishes that Respondent never asked the Registrar for an extension of the Addendum Directive. The Tribunal holds that these excuses do not justify Respondent’s failure to comply with the Registrar’s Amended Directive. Thus, Respondent has failed to sustain his burden of persuasion in this matter.
Therefore, because Complainant has established Respondent’s violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22), Complainant has also established cause for the Registrar to discipline Respondent’s contractor’s license.
Complainant may petition the Registrar’s Recovery Fund for financial recompense in this matter.
RECOMMENDED ORDER
Based on the foregoing,
IT IS RECOMMENDED that five days after the effective date of the Final Order in this matter, Respondent Engrained Cabinetry and Countertops LLC, ROC License No. 265845, be suspended for six (6) days.
IT IS FURTHER RECOMMENDED that the Registrar require Respondent to pay the sum total of $200.00 (two hundred dollars) in certified funds as a civil penalty in this matter.
IT IS FURTHER RECOMMENDED that if Respondent fails to pay the entire amount of the civil penalty on or before thirty (30) days following the effective date of the Registrar’s Final Order, the Registrar shall revoke Respondent’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in Ariz. Rev. Stat. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty.
NOTICE
Pursuant to Ariz. Rev. Stat. § 41-1092.08(I), the licensee may accept the Administrative Law Judge Decision by advising the Office of Administrative Hearings in writing not more than ten (10) days after receiving the decision. If the licensee accepts the Administrative Law Judge Decision, the decision shall be certified as the Final Decision by the Office of Administrative Hearings.
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.
Done this day, August 07, 2023.
Office of Administrative Hearings
/s/ Jenna Clark
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Martín Quezada, Director
c/o Legal Department
Registrar of Contractors
1700 W. Washington St., Ste. 105
[email redacted]
Engrained Cabinetry and Countertops LLC, Respondent
6690 Inter-Cal Way
Prescott, AZ 86301
[email redacted]
Molly Schulz, Complainant
1730 N. Blue Spruce Cir.
Flagstaff, AZ 86001
[email redacted]
By: OAH Staff