ALJDEC decisions subject to certification as final

2023A-09557-RFA-ROC · Registrar of Contractors · 2025-10-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Don LoGuercio,

COMPLAINANT

Lavender Landscape Design Co. LLC,

License No. ROC 326465,

RESPONDENT

No. 2023A-09557-RFA-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: September 18, 2025

APPEARANCES:

Complainant: Don LoGuercio

Respondent: Tyler Tew

Registrar of Contractors: Mona Baskin, Assistant Attorney General

Gail Mathews

ADMINISTRATIVE LAW JUDGE: Nedra-Su Kawasaki

EXHIBITS ADMITTED INTO EVIDENCE: Department’s Exhibits 1-9.

_____________________________________________________________________

FINDINGS OF FACT

Lavender Landscape Design Co. LLC (Respondent) was the holder of License No. 326465 issued by the Arizona Registrar of Contractors (Registrar).

On or about August 21, 2023, the Registrar received a Complaint against Respondent from Don LoGuercio (Complainant) alleging poor workmanship.

After an investigation an amended written directive was issued to correct the work. The Directive from the Registrar specified, in pertinent part, as follows:

You are directed to remedy the following violations by the appropriate means:

Compliance Item 1: Countertop installed has cracked down center of seam. Contractor has attempted to correct it 3 times. 1st: they cut 2" too short and had scrap piece in seam, 2nd: cracked within 24 hours of install down center, 3rd: cracked within 24 hours of install. Cracks are easily wide enough to fit a quarter into. Seam is wider during morning after it has cooled and narrower under heat from sunlight.;

Investigator’s Observation: At this time, the joint width of this stone slab is greater than 3/8”. Minimum workmanship standards does not allow for a joint width greater than 1/16”. Respondent should correct by appropriate methods.

. . . .

Compliance Item 4: streaks on west wall to the south of Ramada and overspray on sheer decent wall.;

Investigator’s Observation: Paint is not complete on west wall. Overspray is visible on sheer decent wall. Respondent should complete all paint in their scope, correct all paint that is insufficient to cover, correct all overspray and any damage caused to paint by the work of the Respondent.

. . . .

Compliance Item 11: Drywell was recently "fixed" by contractor. We need to ensure this is to code by ROC inspector as we have had settlement of 6+" in the area over a few short months and it has cracked concrete and pavers in area. We had to request multiple times that walls and top be lined with fabric as per verbal discussions with contractor employees. Contractor recently excavated drywell, at our request, to find that 1/2 of the drywell was already filled with dirt and ineffective. Contractor lied about there being fabric liner on sides and only recently corrected after we wanted photos verifying it. Contractor employee Tyler Tew became confrontational once again. Please verify that drywell has been properly installed.;

Investigator’s Observation: Inspection of drywell is under the authority of the building official. The Registrar does not inspect/evaluate work that requires permit and inspection by the building authority. Respondent states that drywell was inspected, however, drywell has been reworked. Respondent should obtain building official reinspection for any corrections made to previously passed, storm water appurtenance. Respondent should provide a copy of the closed permit/certificate of occupancy for this project to this Investigator.

. . . .

Compliance Item 15: On November 17, 2023, Complainant provided a copy of failed inspection from the City of Phoenix, the notice was provided to the parties as additional information. On November 17, 2023, the Respondent replied that they had received the notice and were working on resolution. On November 29, 2023, the Respondent advised that they “should be able to have this completed by the end of next week”.

Investigator’s Observation: Directive period has been extended to allow for the Respondent to comply with the requirements of the building official and address this fail notice. Respondent should complete their scope of work and comply with all requirement of the building official (permit/inspection) relative to their scope. Respondent should provide a copy of the closed permit/certificate of occupancy for this project to this Investigator.

Respondent failed to correct compliance items 1, 4, 11, and 15.

The Registrar issued a Citation against Respondent charging possible violations of Arizona Revised Statutes (A.R.S.) § 32-1154(A)(3), namely A.A.C. R4-9-108(A), and § 32-1154(A)(22).

Respondent filed a timely answer to the Citation, and an administrative hearing was held. In their Decision, Administrative Law Judge Velva Moses-Thompson considered all arguments and concluded that Complainant established Respondent had, in relevant part, violated A.R.S. §§ 32-1154(A)(3) and (A)(22). The Administrative Law Judge recommended a five day suspension of Respondent’s license.

On or about June 12, 2024, the Registrar issued its Final Decision, adopting the Administrative Law Judge’s Decision in full.

Complainant then filed a claim with the Residential Contractors’ Recovery Fund (the Fund) to recover the cost of completing or repairing the project. As part of the claim process, Complainant submitted bids from two different contractors that Complainant had received to correct the project.

The Registrar issued a Notice of Administrative Award, finding that Complainant’s compensable actual damages were $30,000.00. Respondent requested a hearing. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.

A hearing was held on September 18, 2025.

Gail Mathews testified for the Registrar that Complainant was eligible and followed all of the steps required to receive an award from the recovery fund. She testified in support of the documents and calculation provided in the exhibits. She testified in support of Complainant being entitled to a $30,000.00 award. On questioning, Ms. Mathews noted the conclusion of the administrative law judge in the underlying matter that Respondent failed to comply with the Amended Written Directive due to mistakes made by its own subcontractors and engineering firm.

Don LoGuercio testified for Complainant, on questioning, that the ramada built by Respondent had not been demolished, was still standing, and had passed a final inspection. On further questioning, Complainant testified that no work had yet been done by the bidding contractor though it had been hired to perform the corrective work.

Tyler Tew testified for Respondent that of the bid, the engineer and permitting fee were legitimate and accurate. Mr. Tew argued, on behalf of Respondent, that regarding compliance item 15, the ramada had been completed and received a passing inspection and permit in May 2025, therefore it was not demolished and Respondent should not bear the cost of demolition charged on the bid. Further, Mr. Tew argued that the compliance items 4 and 11 (paint and drywell) were so “insignificant” that Complainant did not even get a bid for the correction. Regarding compliance item 1, Mr. Tew argued that the countertop material Complainant chose to use was not a good material to use in the local climate and Respondent never recommended its use. The reason the countertops failed was due to the material Complainant chose. Finally, Mr. Tew argued that “actual damages” was the amount Complainant actually paid to have compliance items 1, 4, 11, and 15 completed, not a bid amount.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

A.R.S. § 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.”

In Arizona, when construing statutes, we look first to a statute’s language as the best and most reliable index of its meaning. If the statute’s language is clear and unambiguous, we give effect to that language and apply it without using other means of statutory construction, unless applying the literal language would lead to an absurd result. Words should be given “their natural, obvious, and ordinary meaning,” unless defined by the legislature.

At issue is the definition of “actual damages.” The applicable statute, in this case, as provided above defines “actual damages.” Therefore, it is not necessary for the undersigned ALJ to construe any other meaning. Specifically, the statute defines actual damages as the amount necessary to complete or repair a residential structure or appurtenance; (an amount) which must be established by supplied bids.

If work is not completed to workmanship standard, it is reasonable for a bidding contractor to include removal of prior work. The bidding contractor is not obligated to accept the condition of existing work.

Respondent had an opportunity to correct the faulty work following the amended written directive from the Registrar and failed to do so. Respondent argued that the accepted bid included demolition and rebuild of the ramada, which was not done; therefore Respondent was not responsible for that cost. Considering Respondent’s argument, even if the demolition and rebuild costs were removed from the bid, the total bid cost would be greater than $30,000.00. The maximum administrative award is $30,000.00. Therefore, the administrative award amount would remain unchanged.

The preponderance of the evidence established that the award provided by the Fund accurately reflected Complainants’ actual damages. Accordingly, Complainant is entitled to a payout from the Fund in the amount of $30,000.00.

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 $30,000.00.

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.

-54864001

001

-137160-45720000 Done this day, October 9, 2025.

/s/ Nedra-Su Kawasaki

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

[email redacted]

Don LoGuercio

[email redacted]

Lavender Landscape Design Co. LLC

[email redacted]

Mona Baskin

Assistant Attorney General

[email redacted]

By: OAH Staff