ALJDEC - Licensing

2023A-05347-RFA-LS-ROC · Registrar of Contractors · 2024-11-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Brianna Hardin,

COMPLAINANT

Fripps and Associates Inc.

License No. ROC 327913,

RESPONDENT

No. 2023A-05347-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: November 1, 2024

APPEARANCES: Brianna Hardin, Complainant; Troy Blair, Complainant Witness; Richard Hundley, Respondent Counsel; George Ripps, Respondent; Charles Hover, Assistant Attorney General represented the Registrar of Contractors; Tedi Quezada, Registrar of Contractors Claim Reviewer.

ADMINISTRATIVE LAW JUDGE: Nicole Robinson

EXHIBITS ADMITTED INTO EVIDENCE: Notice of Hearing Packet, Registrar of Contractor’s Exhibits 1-6, and Respondent’s Exhibit 1.

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

The Arizona Registrar of Contractors (Registrar) issued License No. ROC 327913 to Respondent.

On or about May 8, 2023, the Registrar received a Complaint against Respondent from Complainant alleging, among other things, abandonment and poor work (workmanship complaint).

As a result of the workmanship complaint, on August 16, 2023, the Registrar issued a Citation against Respondent charging possible violations of Ariz. Rev. Stat. § 32-1154(A)(3), namely of Ariz. Admin. Code R4-9-108, and Ariz. Rev. Stat. § 32-1154(A)(22). Respondent filed a timely answer to the Citation.

An administrative hearing was held between the respective parties on October 26, 2023. In Administrative Law Judge (ALJ) Decision No. 2023A-05347-CHC-ROC, ALJ Moses-Thompson considered Respondent’s arguments and concluded, among other things, that “Respondent failed to correct the items listed in the Registrar’s Directive without valid justification, which is a violation of Ariz. Rev. Stat. § 32-1154(A)(22).”

On or about December 12, 2023, the Registrar issued a Final Administrative Decision and Order affirming the ALJ’s decision but modifying it to include that “Respondent failed to perform the home remodeling project in a professional and workmanlike manner in violation of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A).” In addition, the Registrar imposed a civil penalty of $250.00.

Complainant filed a claim through the Respondent’s bond company, RLI Insurance Company (RLI). On February 16, 2024, RLI determined in part:

At this time, RLI elects to exercise its right under ARS § 32-1152(E) and require that a civil suit be filed, and judgement obtained, against both the principal (Fripps and Associates, Inc.) and the surety (RLI) before payment is issued under the bond. ...In the meantime, if you have filed a Complaint with the Arizona Registrar of Contractors, and are pursing the Recovery Fund, please consider providing a copy of this letter to the Arizona Registrar of Contractors.

On May 19, 2024, Complainant filed a claim with the Residential Contractors’ Recovery Fund (the Fund) to recover the cost of completing or repairing the project in the amount of $17,755.38. As part of the claim process, Complainant submitted bids from four different contractors that Complainant received to correct the project.

On August 29, 2024, the Registrar issued a Notice of Administrative Award, finding that Complainant’s actual damages were $16,475.00. On September 10, 2024, Respondent appealed the Notice of Administrative Award and requested a hearing, believing Complainant was not entitled to recovery from the fund. Complainant did not contest the amount of the administrative payout. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.

Hearing Evidence

On June 5, 2023, the Written Directive from the Registrar specified the following in pertinent part:

After investigation, the Registrar determined that you failed to meet the requirements of Ariz. Rev. Stat. § 32-1154(A). . . .

You are directed to remedy the following violations by the appropriate means prior to the deadline on July 5, 2023 by 5:00 p.m.:

Compliance Item: 1-1. Roof Repair – There is a leak in the roof near the entry way. A portion of the roof around the rounded entry way is unfinished. George was made aware of this months ago but did not act on it.

Investigator’s Observation: Water stains indicate a leak at the front entry area. Respondent should determine cause and correct by appropriate methods.

Compliance Item: 2-2. Water Damage Repair – There is water damage in the entry way coat closet ceiling, walls, and surrounding baseboards caused by a roof leak/unfinished roof that George was made aware of prior.

Investigator’s Observation: Water stains indicate a leak at the front entry area. Respondent should determine cause and correct leak damage by appropriate methods.

Compliance Item: 3-3. Jet Tub (Master Bath) – Not plumbed in or hooked up whatsoever. Simply placed in the opening as a space holder.

Investigator’s Observation: Tub spa does not appear to be connected. Respondent should determine cause and correct by appropriate methods.

Compliance Item: 4-4. Exterior Storage Door – Missing lock. Also, not an exterior door.

Investigator’s Observation: Rear storage room door has missing weather strip and missing lock set. Rear storage room door & frame paint badly deteriorating. Respondent should determine causes and correct by appropriate methods.

Compliance Item: 6-6. Exterior Shower Ceiling – large holes in the ceiling. George stated he would have someone tile the ceiling to match the shower instead of truly patching the holes and re-stuccoing the area.

Investigator’s Observation: There are holes in the ceiling area of the exterior shower. Respondent should correct by appropriate methods matching the surrounding areas by appropriate methods.

Compliance Item: 7-7. Kitchen Cabinets Trim – Gaps are present under the cabinets where the cabinets are and the trim has come off (currently stuck back on by us using double-sided tape).

Investigator’s Observation: Cabinet toe kick skins loose. Respondent should correct by appropriate methods.

Compliance Item: 8-8. Grout around Spare Bathtub – Grout around the bath tub in the spare bath tub has large areas that are not grouted allowing water to get into the space.

Investigator’s Observation: Respondent should properly correct missing grout issues during first year of occupancy matching surrounding areas as closely as possible.

Compliance Item: 9-9. Electrical Issus – The light switches throughout the house are not wired properly (e.g. fan and light are on the same switch, not separate).

Investigator’s Observation: Electrical plan shows several discrepancies in light and fan switching. Dual switching to light/fans and 3-way switching to lights were not installed to plans. Respondent should properly correct all light and fan switching to match plans.

Compliance Item: 10-10. Outlet in the master bedroom has no power to it.

Investigator’s Observation: Outlet in master bedroom was not energized. Respondent should determine cause and correct by appropriate methods.

Compliance Item: 11-11. Multiple “blank switches,” per George, throughout the house for lights that are actually not wired correctly (e.g. back patio lightsx2 and fan with light are all activated by 1 switch instead of 2 separate switches).

Compliance Item: 12-12. Microwave Vent – The microwave was moved approximately 1 foot to the left and the exterior vent was never moved and hooked up to the microwave. George said this would be done and acted surprised when we told him it still was not completed but is now denying stating it would be completed and operable. George stated it was our fault for asking him to reconfigure the kitchen during construction stage.

Investigator’s Observation: Respondent should properly connect the microwave ductwork to vent outside.

Compliance Item: 13-13. Window Screens – There are no screens on any of the windows of the house and George stated multiple times he was going to order screens or have someone sent over to measure for them, both of which never happened. Most recently, George stated he was “waiting for the weather to get better” because he “figured [we] didn’t open the windows.

Investigator’s Observation: Respondent should properly provide and install all window screens.

Compliance Item: 15-15. AC/Heater Issues – the AC/Heater does not blow in the spare bedrooms or bathroom.

Investigator’s Observation: Airflow at spare bedroom and bathroom appeared diminished. The WSLC states that the Respondent should properly balance the HVAC system. Respondent should determine cause and correct by appropriate methods.

All errors in original.

On July 31, 2023, a Compliance Inspection was conducted by Registrar Investigator Cliff Corlett. Investigator Corlett determined on August 7, 2023 that of the 13 items on the Written Directive that needed to be corrected that Respondent addressed the electrical issues in complaint items 9, 10, and 11. However, that Respondent was not in compliance with the other ten complaint items - 1, 2, 3, 4, 6, 7, 8, 12, 13 and 15.

Tedi Quezada, Legal Assistant II for the Registrar, testified that she reviewed the Directive from the Registrar that had been issued, Judge Moses-Thompson’s ALJ Decision regarding the underlying complaint, and bids submitted by Complainant in calculating Complainant’s actual damages. Specifically, Ms. Quezada testified that she determined that the following bids were appropriate to make the necessary repairs per the Directive:

2ND To None Construction, License No. ROC 339213 in the total amount of $14,700.00;

Lance Taylor Plumbing, License No. ROC 336007 in the total amount of $1,200.00; and

Alan Robert McGovern, DBA: A.R.M. Construction, License No. ROC 335960 in the total amount of $575.00.

Respondent did not offer any evidence or testimony to dispute the Registrar’s calculation of Complainant’s actual damages. Rather Respondent contended that Complainant should not have the ability to recoup losses from the recovery fund because (1) her bids were subpar and (2) that she did not initiate a civil lawsuit against the Respondent’s bond company.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Ariz. Rev. Stat. § 32-1132.01(B) provides, in pertinent part, as follows:

An award from the residential contractors' recovery fund may not exceed the actual damages suffered by the claimant as a direct result of a contractor's violation. Actual damages:

(1) May not exceed an amount necessary to complete or repair a residential structure or appurtenance within residential property lines.

(2) Must be established by bids supplied by or the value of work performed by a person that is licensed pursuant to this chapter if the person is required to be licensed pursuant to this chapter.

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.”

In regards to the Complainant’s bids being subpar, see Ariz. Rev. Stat. § 32-1132.01(B)(2) which does not provide for specific elements to define a ‘bid.’ However, Complainant provided multiple bids which were all from licensed contractors that contained the dollar amounts, the calendar date when the bid was generated, and the prospective services to be performed which all suffice as a legitimate bid per standard practice.

In regards to Respondent’s argument that Complainant must initiate a civil lawsuit in order to be entitled to a Recovery Fund payout is not convincing. Per Ariz. Rev. Stat. § 32-1133.01(F) provides that prior to a complainant filing a claim for an award from the Recovery Fund, one must first file a claim against the residential contractor’s bond and provide the Registrar with a copy of the results of that claim. Nothing in the statute requires a complainant to pursue the matter further.

Complainant followed the statutory requirements and furnished the RLI determination to the Registrar on May 19, 2024. Due to the bond company’s decision, Complainant strictly moved forward with an Administrative remedy and not a civil remedy via a lawsuit against the bond company.

After review of all the evidence, the Tribunal concludes that the award provided by the Fund accurately reflected Complainant’s actual damages. Accordingly, Complainant is entitled to a payout from the Fund in the amount of $16,475.00.

RECOMMENDED ORDER

Based on the foregoing,

IT IS ORDERED that on the effective date of the Registrar’s final order in this matter, the Residential Contractors’ Recovery Fund shall pay $16,475.00 to Complainant Brianna Hardin.

IT IS FURTHER ORDERED that under Ariz. Rev. Stat. § 32-1139(B), the Registrar shall charge $16,475.00, plus interest at a rate of ten percent a year, to Respondent Fripps & Associates, Inc. License Number 327913.

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, November 21, 2024.

/s/ Nicole Robinson

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

[email redacted]

Richard W. Hundley, Esq.

[email redacted]

Fripps and Associates Inc.

[email redacted]

Brianna Hardin

[email redacted]

Registrar of Contractors

[email redacted]

By: OAH Staff