ALJDEC - Licensing

2023A-00690-RFA-LS-ROC · Registrar of Contractors · 2024-06-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Ronnie L Miertschin,

COMPLAINANT,

v.

Dickinson Enterprises LLC,

License No. ROC 327382,

RESPONDENT.

No. 2023A-00690-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: June 4, 2024

APPEARANCES: Assistant Attorney General Mona Baskin appeared on behalf of the Arizona Registrar of Contractors (Registrar). Ronnie Miertschin appeared on his own behalf. Mark Dickinson appeared on behalf of Respondent.

ADMINISTRATIVE LAW JUDGE: Amy M. Haley

EXHIBITS ADMITTED INTO EVIDENCE: Registrar’s exhibit 1, 2, 3, 4, 5, 6, 7, 8, 9. Complainant’s exhibits labeled SOW03, SOW 05, SOW 09 and exhibit 3 were admitted.

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

The Arizona Registrar of Contractors (Registrar) issued License No. 327382 to Respondent.

On or about January 18, 2023, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to Respondent’s work on the project.

As a result of the workmanship complaint, the Registrar issued a Citation against Respondent charging possible violations of Arizona Revised Statute (A.R.S.) § 32-1154(A)(3), namely Arizona Administrative Code (A.A.C.) R4-9-108(a); and A.R.S. § 32-1154(A)(22).

A Final Administrative Decision and Order (Default) was issued on May 26, 2023, due to Respondent’s failure to file a timely answer to the Citation.

An Order Setting Aside Final Administrative Decision and Order (Default) and Order Setting Hearing was issued on June 9, 2023.

An administrative hearing was held on July 31, 2023. In her August 7, 2023 Decision, Administrative Law Judge (ALJ) Sondra Vanella referenced Investigator Chester’s Written Directive and Amended Written Directive as follows:

Complaint Item: Contractor indicated in Scope of Work (SOW), drainage blocks (English Style Figure 8) would be install in every wall panel (3 drainage blocks per panel). The drainage blocks were not installed. Investigator’s Observation: At time of inspection blocks were installed with pipe drainage and not English style as listed in contract. Respondent shall complete project per original contract agreement, properly executed change orders, verbal agreements, local building codes and manufacturers installation instructions.

. . . . .

Complaint Item: Provide Wall Permit required for the work performed Investigator’s Observation: No permit was provided by respondent at time of inspection. Respondent will need to provide investigator with Permit for wall.

Judge Vanella considered Respondent’s arguments and concluded that Respondent had violated the provisions of the Registrar’s statute as noticed in the Citation. Specifically, Judge Vanella found:

The evidence established that Respondent’s work was not in conformity with the Registrar’s standards. Respondent constructed the wall without drainage, and moreover, constructed the wall without obtaining the required permit. Therefore, Complainants established that Respondent did not complete the project in a professional and workmanlike manner in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A).

On or about August 28, 2023, the Registrar issued a Final Administrative Decision and Order (Order) finding the violations and imposing a seven day suspension.

Respondent did not appeal the Order.

Complainant then filed a claim with the Residential Contractors’ Recovery Fund (the Fund) to recover the cost repairing and completing the project.

As part of the claim process, Complainant was deemed to have met the eligibility criteria for applying to the Fund.

As part of the claim process, Complainant submitted multiple bids that Complainant had received for the project.

The Registrar issued a Notice of Claim for Administrative Payout, finding that Complainant’s actual damages were $4,195.40. Complainant requested a hearing, believing the payout was too low as it did not “cover the cost to remediate the workmanship deficiencies as stipulated by the State of Work and the Permit application submitted by the Respondent.” Respondent contested the amount of the administrative payout, believing the payout was too high. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.

Hearing was held on June 4, 2024.

Hearing Evidence

Katelyn Rolling, Legal Assistant II for the Fund, testified that she reviewed the contract, the Written Directive(s) from the Registrar that had been issued, Judge Vanella’s August 7, 2023 Decision regarding the underlying complaint, and bids submitted by Complainant in calculating Complainant’s actual damages. Ms. Rolling then conferred with Investigator Chester and determined that the bid submitted from Bethel Concrete Work in the amount of $3,650.40 was appropriate. Ms. Rolling further determined that the bid for $325.00 from Painted Sky Investment was appropriate. Lastly, Ms. Rolling determined that Complainant was entitled to the reimbursement of $220.00 that was paid to Maricopa County for the permit. Ms. Rolling also determined that Complainant had overpaid Respondent by $4.00, though it does not appear to be factored into the final Administrative Payout figure.

Complainant testified on his own behalf. Complainant testified that, at the time of the July 31, 2023 hearing, he did not know that the wall as built, being 8x8x16, could not be permitted. He was further unaware of that information at the time he applied for the Fund. Complainant stated that he discovered that the wall, as built, could not be permitted when he submitted his own application for the permit. He submitted plans for both an 8x8x16 wall, and a 4x8x16 wall. Only the latter was approved. Complainant testified that, although he had applied and paid for a permit, he had not yet obtained one. Complainant subsequently submitted bids to reflect what it would cost to tear down and rebuild a wall that could be permitted. He believed that these repairs were not outside the scope of the Written Directive because the Written Directive called for the work to be completed and he believed that “completing” meant a valid permit. However, he further acknowledged that the bids he submitted for the tear and rebuild were to rebuild an 8x8x16 wall, not a 4x8x16 wall. Therefore, the bids did not reflect what the costs would be for the new dimensions which would be significantly less.

Mark Dickinson testified on behalf of Respondent. Mr. Dickinson did not provide any relevant testimony with regard to the issue of the Fund payout. Mr. Dickinson testified that he requested the opportunity to finish the project.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

A.R.S. § 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. . . .” Complainant and Respondent bear 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.”

Judge Vanella’s findings were specific in her August 7, 2023 Decision. Specifically, Judge Vanella found a violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A) because Respondent constructed the wall without drainage and because Respondent constructed the wall without first obtaining the required permit.

Therefore, this ALJ is confined to these issues in determining whether the payout from the Fund was appropriate. Whether a permit could be obtained for the wall as built is not an issue being addressed in this Decision, nor was that an issue for Judge Vanella’s consideration in her July 31, 2023 hearing, only that a permit was not obtained. Complainant was not aware of this information at the time of the July 31, 2023 hearing; therefore, this issue was not litigated. Although it may seem that the inability to obtain a permit for this project, as is, is related to the original Written Directive, in fact, Respondent has a right to present its case on that issue. Because that narrow issue was not addressed in the July 31, 2024 hearing, it remains ripe for litigation at a different time where both parties can present their case.

Respondent had a duty to obtain permits prior to beginning work. Respondent failed to do so. It was on that issue, and the fact that the wall lacked drainage blocks, that Judge Vanella found a violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A). Therefore, it is those issues alone that control the appropriateness of the payout from the Fund.

After review of all the evidence, the Tribunal concludes that the award provided by the Fund accurately reflected Complainant’s actual damages on the issues presented at the July 31, 2023 hearing. However, the award did not factor in the overpayment of $4.00 made by Complainant to Respondent.

Therefore, accordingly, Complainant is entitled to a payout from the Fund in the amount of $4,199.40.

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 $4,199.40.

Pursuant to A.R.S. § 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, June 11, 2024.

/s/ Amy M. Haley

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

By: OAH Staff