ALJDEC - Licensing
2023A-08646-CHC-ROC · Registrar of Contractors · 2025-03-18
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Barry Saunders,
COMPLAINANT,
v.
Sonora West Development Inc.
ROC License No. 164411,
RESPONDENT.
No. 2023A-08646-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: August 26, 2024, November 21, 2024, February 11, 2025, and February 12, 2025.
APPEARANCES: Mitchell Antalis, Esq. appeared on behalf of Barry Saunders (“Complainant”). Frederick Davidson, Esq. appeared on behalf of Sonora West Development Inc. (“Respondent”) with Jeff Gaines, Sondra Hendrickson, and Scott Pfeiffer as witnesses. Robert Di Alto appeared on behalf of the Arizona Registrar of Contractors (“Registrar”).
ADMINISTRATIVE LAW JUDGE: Jenna Clark.
EXHIBITS ADMITTED INTO EVIDENCE: The Notice of Hearing on Contested Case (“Notice of Hearing”), including the Registrar’s attached agency file, Hearing Orders dated July 18, 2024, August 28, 2024, and November 22, 2024, Minute Entry dated August 20, 2024, Complainant Exhibits 6, 11, 13 (Bates Stamp pages SAUNDERS000135- SAUNDERS000144 only), 14, 16, 23-24, 26, 31, and 53, and Respondent Exhibits 1-4, 6-7, 9-10, 13, 16-17, 20, 27 & 34-36, 37 (for limited purpose), and 38-39 were admitted into the evidentiary record.
_____________________________________________________________________
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 April 23, 2001, the Registrar issued ROC License No. 164411 General Dual KB-2 Residential and Small Commercial contracting license to Respondent. The license has been renewed through April 30, 2025. Scott Christian Pfeiffer is listed as the Qualifying Party and Officer on the license. Respondent’s address of record for the license is 17767 N. Scottsdale Rd., Ste. 210, Scottsdale, Arizona 85255. Respondent had a $20,000.00 surety bond on the license issued by Contractors Bonding and Insurance Company, effective April 27, 2023. The license has no prior disciplinary history, but has had three (3) other complainants settled or otherwise resolved against it. Currently, the license has one (1) open complaint against it; is presumed to be related to this matter.
On July 27, 2023, the Registrar received a 69-item complaint from Complainant against ROC License No. 164411 poor work regarding a residential new build. The Registrar designated it Complaint No. 2023-08646 and assigned the matter to Steve Klein (“Investigator Klein”) for investigation.
On August 08, 2023, Investigator Klein issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on October 05, 2023, at 10:00 a.m. Correspondence was not returned as undeliverable to Respondent.
Respondent did not provide a response to Complaint No. 2023-08646, or request to inspect the work complained of.
On October 05, 2023, Investigator Klein reviewed the contract-related correspondence executed between the parties, inspected the work that had been performed on the project to date, and took 52 photographs of the project site. Ultimately, Investigator Klein derived seventy-one (71) separate and distinct complaint items from Complaint No. 2023-08646, twenty-three (23) of which he substantiated based on his firsthand observations. Specifically, Investigator Klein determined that complaint items 1-3, 8, 10-11, 13, 15, 27, 36, 39, 47-51, 54, 56, 59, 62-63, 65, and 70 fell below the Registrar’s minimum workmanship standards and required correction and/or completion by Respondent.
On October 12, 2023, Investigator Klein issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated a number of Complainant’s complaint allegation(s) against Respondent. Respondent was put on notice that it had until 5:00 p.m. on November 15, 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 November 09, 2023, Complainant submitted a ninety (90) item Addendum Complaint to the Registrar.
On November 15, 2023, Investigator Klein issued an Addendum Jobsite Inspection Notification letter to the parties, advising that he would conduct an onsite review at the project site on December 12, 2023, at 10:00 a.m. Correspondence was not returned as undeliverable to Respondent.
On December 12, 2023, Investigator Klein inspected the project site and reviewed the substantiated complaint items from his jobsite inspection and Complainant’s addendum complaint items. He took 13 photographs. Ultimately, Investigator Klein determined that Respondent had satisfactorily corrected most of the complaint items he had previously substantiated, but he also substantiated some of Complainant’s addendum compliant items based on his firsthand observations. Specifically, Investigator Klein determined that items 10, 27, 49, 63, 73-76, 81, 85, and 87-88, from both complaints, fell below the Registrar’s minimum workmanship standards and required correction and/or completion by Respondent.
Investigator Klein specifically noted that he used an AMPROBE TH-1 to measure humidity and temperature levels in the home. At that time, the air outside Complainant’s residence was approximately 60oF and “[t]he air throughout the home varied between 78 and 81 degrees,” which Investigator Klein noted was “within industry standards.” Investigator Klein also noted that the humidity inside the home was “between 10 and 21 percent,” but that he was “unable to determine that the home has been maintained in the appropriate environmental conditions for the installation” despite being provided with the manufacturer’s installation instructions.
On December 13, 2023, Investigator Klein issued an Amended Written Directive from the Registrar (“Amended Directive”) to Respondent regarding the aforementioned compliance items and substantiated addendum complaint allegation(s). Respondent was put on notice that it had until 5:00 p.m. on January 19, 2024, to notify the Registrar of its completion of 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 January 26, 2024, Respondent emailed Investigator Klein to provide notice that it had complied with and completed the Registrar’s Amended Directive.
In or around early-February 2024 Investigator Klein retired from the Registrar’s employ. Shortly thereafter, investigator Robert Di Alto (“Investigator Di Alto”) was reassigned to Complaint No. 2023-08646.
On February 13, 2024, Investigator Di Alto issued a Compliance Jobsite Inspection Notification letter to the parties, advising that he would conduct an onsite review at the project site on March 04, 2024, at 10:45 a.m. Correspondence was not returned as undeliverable to Respondent.
On March 04, 2024, Investigator Di Alto inspected the project site and reviewed Complainant’s compliance items and addendum complaint items. He took 11 photographs. When he was finished, Investigator Di Alto drafted his Compliance Jobsite Inspection General Notes (“CJSI Notes”). Ultimately, Investigator Klein determined that addendum complaint items 49, 63, 73-76, 81, 85, and 87-88 were satisfactorily corrected by Respondent, but modified complaint items 10 and 27 were not sufficiently remediated by Respondent and did not satisfy the Registrar’s minimum workmanship standards.
On March 09, 2024, Complainant requested permission from Investigator Di Alto to “[C]hange my decision from a settled case to a disciplined case” regarding concerns over original complaint item 70. On an unknown date shortly thereafter, Complainant submitted a renewed complaint regarding complaint item 70. Specifically, Complainant noted, “Interior doors have some extreme sheen differences, fingerprints, gray spots and breakthrough of wood color.”
On March 20, 2024, Investigator Di Alto issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of complaint item 70 on April 09, 2024, at 12:30 p.m. Correspondence was not returned as undeliverable to Respondent.
On April 09, 2024, Investigator Di Alto inspected the project site and reviewed complaint item 70. He took 50 photographs. Investigator Di Alto noted the following:
I observed the interior doors at the following locations, from approximately 20, 60 and 85 degree angles: Powder room door, bedroom 2 entrance door, bedroom 2 closet door, bedroom 3 entrance door (good), bedroom 3 closet door, office entrance door, closet double doors, office bathroom door, and master bedroom water closet door. I saw variations in the finish of the interior and exterior of the first two doors and as well some smudges and stripping in the finish, while inspecting the powder room and bedroom2 [sic] doors. They appeared glossy on one side to more of a cloudy matte finish on the opposite side. I asked [Respondent] what the specification for the finish sheen on the interior doors was, and the answer was that the finish options were either painted or stained. I explained that I observed that the doors were stained, but was the finish to be matte, satin, semigloss [sic], or gloss? [Respondent] repeated the previous answer. I completed my inspection of the remaining doors and there are readily visible variations in the sheen and imperfections in the finish including stripping, lap marks, cloudy areas in the finish and what appear to be smudges. The bedroom 3 door does not exhibit the above described issues and appears to have a consistent finish, and requires no further action by [Respondent]. As far as the other interior door that were inspected, [Respondent] shall correct by the appropriate means.
Per Investigator Di Alto, Respondent’s workmanship regarding complaint item 70 constituted a violation of Ariz. Admin. Code R4-9-108(c).
On April 18, 2024, Investigator Di Alto issued another Amended Written Directive from the Registrar (“Amended Directive #2”) to Respondent because he substantiated Complainant’s allegation(s) regarding complaint item 70 against Respondent. Respondent was put on notice that it had until 5:00 p.m. on May 06, 2024, to notify the Registrar of its compliance with the Amended Directive #2 or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A) and 32-1154(E). Correspondence was not returned as undeliverable to Respondent.
Between May 14, 2024, and May 15, 2024, Investigator Di Alto and Complainant corresponded with one another regarding Respondent’s compliance with Amended Directive #2. Per Complainant, Respondent completed the doors, but touch-ups were required to address “chips from installation.” Although Investigator Di Alto inquired as to whether Complainant brought the chip concern to Respondent’s attention, he did not receive a reply.
On May 17, 2024, Investigator Di Alto forwarded the matter to the Registrar’s legal department with the issuance of a Citation Recommendation, whereby he noted that Respondent did not comply with the Amended Directive regarding modified complaint items 10 and 27 only.
On May 21, 2024, 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 05, 2024, 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 05, 2024, the Registrar received Respondent’s timely Answer, whereby Respondent argued that the Citation was issued in error as it opined that all substantiated complaint items, both original and addendum, had been sufficiently addressed by Respondent. Respondent also argued that the Citation was deficient because it failed to allege which complaint items, if any, correlated to the alleged statutory and regulatory provisions detailed in the corrective action document. Respondent further opined that any imposition of discipline against ROC License No. 164411 would be in violation of its due process and equal protection rights under the United States and Arizona Constitutions.
In or around mid-June 2024, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on August 26, 2024. Per the July 18, 2025, 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 his own behalf and called Investigator Di Alto as a witness. Jeff Gaines, Sondra Hendrickson, and Scott Pfeiffer testified on behalf Respondent. The substantive evidence of record is as follows:
On or about April 26, 2021, Complainant entered into a $3,000,000.00 residential property purchase agreement with Respondent for a semi-custom build at 247750 N. 90th Way Scottsdale, Arizona 85255. The interior structure is approximately 5,300 square feet.
Respondent was the general contractor for the construction of Complainant’s residence.
Complainant ultimately paid Respondent $3,678,499.00 for the construction of his home.
The build was completed on or about April 23, 2021. On January 26, 2022, a Certificate of Occupancy (“CofO”) was issued for the property. Complainant closed escrow on January 31, 2022, and moved-in on March 04, 2022.
Investigator Klein’s October 12, 2023, Directive required Respondent to take “appropriate corrective action” by “appropriate means” regarding the following complaint items, in pertinent part:
#10: Flooring Material: Damaged, stained, showing signs of wear, or poorly installed in bathroom
Inspector’s Observation: Bonus room, verified Checks, cupping and hollow areas. Complainant points out a hump in the floor that appears to be over 3/16” from flat.
The floor should be flat within 3/16” in a 10’ radius
Respondent shall correct by the appropriate means.
* * *
#27: Gap between drywall/baseboard and drywall/door jams are uneven
Inspector’s Observation: Complainant points out reglet gap reveals around interior doors and along the base.
My opinion is the gaps should be consistent[.]
Respondent shall correct by the appropriate means.
Investigator Klein’s December 13, 2023, Amended Directive noted the following regarding substantiated complaint items #10 and #27:
#10: Completed, however there’s lippage issues that the Respondent agreed to correct.
#27: Respondent addressed the complaint, however the Complainant points out two areas that still has issues (Door to the garage and office door and base)[.]
(Emphasis added.)
Investigator Di Alto’s March 04, 2024, CJSI Notes contain the following regarding substantiated complaint items #10 and #27:
#10 Compliance Findings: I observed engineered wood flooring at several areas throughout the residence that exhibit check marks (splitting) at the ends of the flooring planks. Thses areas included the following: Entry way, living area, dining area, hallways, bedroom 2, bedroom 3, office. I counted approximately 25+ during the time of this compliance jobsite inspection in the entry, living and kitchen areas. After reviewing the installation specifications and adhesive specifications provided by the Respondent in a 01/11/2024 email, it appears that the Respondent failed to follow the manufacturers installation instructions prior to and during installation. This includes lack of moisture testing and evaluation records of the existing substrate and engineered flooring material. An alternative adhesive other than the recommended adhesives per the manufacturer amy have also been used. The residence may not have been aclimatized prior to the installation of the engineered wood flooring being installed. The Complainant also provided evidence of when the HVAC system start up was performed, and it was subsequent to the completion of the engineered wood flooring installation.
NOT CORRECTED
(All errors and emphasis in original.)
#27 Compliance Findings: I observed the reglets in bedroom #2. At the S/E corner it appears the correction of this compliance item did not address the inconsistency of the gap throughout the room.
NOT CORRECTED
Respondent’s license remained active and in good standing with the Registrar from October 12, 2023, to January 19, 2024, and further through May 06, 2024. Respondent did not allege a denial of access to the project site during that period, or request an extension at the expiration of either Amended Directive’s compliance period.
Additional Evidence
Investigator Di Alto testified that, in his opinion, his predecessor’s investigation notes were “vague” and insufficient. As a result, he had to comb the entire file to decipher the crux of the issue between the parties, and to determine what corrective work had been ordered by Investigator Klein. Afterwards, he decided to issue Amended Directive #2 to address complaint item 70, which he later verified as being satisfactorily corrected by Respondent.
Investigator Di Alto testified that only complaint items 10 and 27 remained outstanding by May 06, 2024, as all other complaint items had been satisfactorily remediated by Respondent by that date.
Regarding complaint item 10, Investigator Di Alto testified that although Respondent had remediated the checking issue in the floors, there were still issues with cupping and gapping throughout the home.
Regarding complaint item 27, Investigator Di Alto testified that Respondent addressed nearly all interior doors, save the door that led to Complainant’s garage and his office door.
Per Investigator Di Alto, there was inconclusive information available to determine whether the planks were acclimatized to Complainant’s residence prior to installation, because no evidence existed to establish what the home’s temperature and/or humidity levels were during the material’s storage or installation. Investigator Di Alto also testified that he was unable to determine whether Complainant’s floors had been subject to improper use or maintenance post installation.
Per Complainant, although the HVAC for his home was installed in December 2021, the “start up” was not performed until March 03, 2022.
The gas bill for Complainant’s residence for service January 27, 2022, through February 25, 2022, was $14.99. The bill increased to $143.28 for service February 26, 2022, through March 14, 2022.
Administrative Notice is taken of average temperatures in Scottsdale, Arizona 85255:
In January 2022, the average temperature was 56.3oF; with an average high of 68.3oF and an average low of 44.3oF.
In February 2022, the average temperature was 57.2oF; with an average high of 70.1oF and an average low of 44.2oF.
In March 2022, the average temperature was 64.4oF; with an average high of 77.8oF and an average low of 51.1oF.
In April 2022, the average temperature was 74.0oF; with an average high of 87.5oF and an average low of 60.4oF.
In May 2022, the average temperature was 81.4oF; with an average high of 94.9oF and an average low of 68.0oF.
In June 2022, the average temperature was 92.1oF; with an average high of 104.0oF and an average low of 80.1oF.
In July 2022, the average temperature was 94oF; with an average high of 105.1oF and an average low of 84.1oF.
In August 2022, the average temperature was 91.3oF; with an average high of 101.5oF and an average low of 81.1oF.
In September 2022, the average temperature was 88.9oF; with an average high of 99.6oF and an average low of 78.3oF.
In October 2022, the average temperature was 74.9oF; with an average high of 85.9oF and an average low of 63.9oF.
In November 2022, the average temperature was 58.2oF; with an average high of 70.4oF and an average low of 46.0oF.
In December 2022, the average temperature was 53.7oF; with an average high of 63.6oF and an average low of 43.8oF.
In January 2023, the average temperature was 52.0oF; with an average high of 61.8oF and an average low of 42.2oF.
In February 2023, the average temperature was 54.8oF; with an average high of 65.9oF and an average low of 43.8oF.
In March 2023, the average temperature was 59.4oF; with an average high of 69.9oF and an average low of 48.8oF.
In April 2023, the average temperature was 71.7oF; with an average high of 85.9oF and an average low of 57.5oF.
In May 2023, the average temperature was 80.2oF; with an average high of 92.4oF and an average low of 68.0oF.
In June 2023, the average temperature was 85.6oF; with an average high of 98.7oF and an average low of 72.5oF.
In July 2023, the average temperature was 98.9oF; with an average high of 110.7oF and an average low of 87.1oF.
Complainant testified that he keeps his home between 74oF and 76oF degrees, even when away while traveling.
Complainant denied misuse of his flooring and testified that his housekeeper, whom he has employed for over a decade, only ever used a Swiffer brand mop that utilized a pre-moistened disposable pad to clean the floors. Per Complainant, he purchased Bissell Crosswave Wood Floor Cleaner, Bissell Hard Floor Sanitizer, and Bona Hardwood Floor Cleaner for her to use.
Complainant testified that the property in question was purchased as his family’s “dream home,” but that shortly after taking possession his wife fell very ill. Due to the sensitive nature of his wife’s illness, Complainant expressed to Respondent that he did not want “a bunch of people in the house” trying to address the punch list. While he acknowledged that “[s]ome things are rather simple fixes while others are not,” he expressed that remediation of larger issues would pose a serious inconvenience. Complainant also noted that “none of the AC units [are] working and the electrical boxes attached to the AC units are painted shut.” Beyond expressing his disappointment regarding quality control of the build, Complainant shared that he was frustrated that his wife would have to bear further disruption during her recovery.
After his wife passed away, Complainant was left to attempt to resolve Complaint No. 2023-08646 and care for his two (2) small children, one of whom is cognitively delayed.
After the parties had difficulties scheduling time to address punch list items, the relationship tensed. The relationship became acrimonious after some of Complainant’s personal property was damaged, misplaced, and stolen.
Elite Hardwood Installations, Inc. (“Elite”), ROC License No. 323380, was subcontracted by Respondent to install Complainant’s flooring. Mr. Gaines is Elite’s Qualifying Party and President. Mr. Gaines testified that 60oF-75oF was the appropriate temperature range for proper acclimatization for flooring materials used in Complainant’s residence, and that the materials required 30% to 50% humidity. Per Mr. Gains, any liquid left atop Complainant’s floors for longer than fifteen (15) minutes would penetrate their surface and cause damage over time, including expansion and cupping.
Ms. Hendrickson testified that when she asked Investigator Klein for direction regarding his instructions to address complaint items 10 and 27, she was told to focus on the “hump” in Complainant’s Bonus Room and make the reglet spacing, which had a 1/8in to 1/4in gap, consistent so they “looked good” throughout the residence. Per Ms. Hendrickson, Respondent placed weights on the planks post installation that needed to remain for at least twelve (12) hours, but that Complainant moved them prior to the expiration of that time to allow his small children access to their bedrooms.
Ms. Hendrickson testified that when she read Investigator Klein’s December 13, 2023, Amended Directive, she interpreted his instructions for complaint item 10 to pertain solely to the Bonus Room, not the entire residence, and thought that his instructions for complaint item 27 solely pertained to the office. Ms. Hendrickson admitted that Respondent did not address all reglets in the home.
Both Mr. Gaines and Ms. Hendrickson testified that they observed Complainant’s housekeeper wet-mop the wood floors. During Investigator Di Alto’s compliance jobsite inspection on March 04, 2024, a large rug in one of the bedrooms was pulled back to reveal like-new flooring, unlike flooring in the same area.
Mr. Pfeiffer testified that he is a 50% owner of Respondent. Mr. Pfeiffer opined that the condition of Complainant’s wood floors were an “anomaly” created by excessively high heat in the home coupled with wet-mopping.
Both Mr. Pfeiffer and Mr. Gaines testified that “checking” is cracking caused by low moisture and cannot occur due to faulty installation. Both testified that wood floors need to acclimate to their installation environment, which takes approximately seven (7) days, prior to install, and during summer and winter seasons HVAC may need to run to ensure proper temperature conditioning.
Both Mr. Pfeiffer and Ms. Hendrickson testified that neither the Registrar, the Ariz. Admin. Code, nor the Ariz. Rev. Stat. contained a requisite measurement or range for reglet spacing.
Closing Arguments
In closing, Respondent argued that of the ninety-three (93) total complaint items filed in Complaint No. 2023-08646, it satisfactorily remediated all of them, save complaint items 10 and 27 per Investigator Di Alto; which Respondent opined did not warrant discipline of ROC License No. 164411 because the wood floors were damaged as a result of Complainant’s misuse and/or poor maintenance, and the reglets had been corrected per Investigator Klein’s instructions.
In closing, Complainant argued that discipline against ROC License No. 164411 was warranted in Complaint No. 2023-08646 because he had sustained his burden of proof to establish violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22). Complainant denied misuse or improper maintenance of his floors, and argued that Respondent failed to properly acclimatize them prior to installation. Complainant also argued that Respondent admitted it did not address all reglets in the home as instructed by Investigator Klein, and that corrections Respondent made to some of the reglets were not consistent.
CONCLUSIONS OF LAW
This matter lies within the Registrar’s jurisdiction. The matter was properly brought before OAH.
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 clear.
It is clear from the record that Complainant paid $3,678,499.00 for a new build constructed by Respondent, and that some of the work Respondent performed on the project fell below the Registrar’s minimum workmanship standards. It is also clear from the record that Complainant took possession of the home on March 04, 2022, and the Registrar subsequently received Complaint No. 2023-08646 regarding Respondent’s poor workmanship on July 27, 2023. The record also reflects that there were several corrective orders issued by the Registrar in this matter: Directive, Issued October 12, 2023, regarding complaint items 1-3, 8, 10-11, 13, 15, 27, 36, 39, 47-51, 54, 56, 59, 62-63, 65, and 70; Amended Directive, issued December 13, 2023, to address modified complaint items 10 and 27, complaint items 49 and 63, and addendum complaint items 73-76, 81, 85, and 87-88; and Amended Directive #2, issued April 18, 2024, regarding revised complaint item 70. Furthermore, the record reflects, per Investigator Di Alto’s credible testimony, that Respondent did not satisfactorily remediate modified complaint items 10 and 27 by January 19, 2024.
Therefore, the only issue in dispute is whether Respondent raised affirmative defenses regarding the deficiencies in its workmanship regarding modified complaint items 10 and 27, and/or its failure to satisfactorily address those issues by January 19, 2024, per the Registrar’s Amended Directive, and/or its failure settle its underlying dispute with Complainant prior to hearing. These defenses must be sustained by a preponderance of the evidence. 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, Respondent has sustain its burden, in part. The credible evidence of record establishes that Respondent raised and sustained its affirmative defense against complaint item 10, but not 27. Although there is insufficient evidence of unusual temperatures or improper humidity levels in Complainant’s home during relevant time period, there is sufficient evidence to establish that Complainant’s housekeeper wet-mop his wood floors to their detriment. Notwithstanding multiple witnesses testifying to their observance of her doing so, and Complainant’s testimony to the frequency of her services, the record reflects a stark and undeniable difference in the condition of the floor’s in one of his children’s bedrooms underneath an area rug verses other uncovered areas site wide as captured in photographs. As such, a violation of Ariz. Rev. Stat. §§ 32-1154(A)(3) and/or 32-1154 (A)(22), relating to complaint item 10, has not been established.
As for complaint item 27 involving the reglets however, a detailed analysis is not necessary as Respondent admitted that it did not attempt to correct all of the reglets in Complainant’s home, which was not in compliance with Investigator Klein’s October 12, 2023, Directive. There was no feasible way for the gaps to “look consistent” if they were not all addressed. Notably, there is no evidence in the record to suggest that Respondent was prevented or otherwise precluded from further addressing this substantial item between April 18, 2024, and May 06, 2024, during Amended Directive #2’s compliance period. Thus, Respondent has failed to sustain his burden of proof regarding this substantiated complaint item. As such, violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154 (A)(22), regarding complaint item 27, have been established.
Because Complainant has established Respondent’s violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154 (A)(22), regarding complaint item 27 only, by a preponderance of the evidence, 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.
RECOMMENDED ORDER
Based on the foregoing,
IT IS RECOMMENDED that five days after the effective date of the Final Order in this matter, Respondent Sonora West Development Inc., ROC License No. 164411, be suspended for one (1) day.
It is further recommended that the Registrar require Respondent to pay the sum total of $100.00 as a civil penalty pursuant to Ariz. Rev. Stat. § 32-1154(E).
It is further recommended that if Respondent fails to pay the entire amount of the civil penalty in certified funds on or before thirty days following the effective date of the Registrar’s Order, the Registrar 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, March 18, 2025.
Office of Administrative Hearings
/s/ Jenna Clark
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Tom Cole, Director
c/o Legal Department
Registrar of Contractors
1700 W. Washington St., Ste. 105
Phoenix, AZ 85007
[email redacted]
William M. Fischbach, Esq.
Mitchell S. Antalis, Esq.
Tiffany & Bosco, Counsel for Complainant
Seventh Floor Camelback Esplanade II
2525 E. Camelback Rd.
Phoenix, AZ 85016-4237
[email redacted]
[email redacted]
Frederick E. Davidson, Esq.
The Davidson Firm PLLC, Counsel for Respondent
8700 E. Pinnacle Peak Rd., Ste. 221
Scottsdale, AZ 85255
[email redacted]
By: OAH Staff