ALJDEC - Licensing
2023A-09765-NPC-ROC · Registrar of Contractors · 2024-04-19
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Lonestar Drywall LLC,
COMPLAINANT
v.
Mark Benz Custom Building and
Remodeling LLC
License No. ROC 296616,
RESPONDENT
No. 2023A-09765-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: April 9, 2024
APPEARANCES: Richard Elley, Esq. appeared as counsel for Complainant. Logan Elia, Esq. appeared as counsel for Respondent.
ADMINISTRATIVE LAW JUDGE: Amy M. Haley
EXHIBITS ADMITTED INTO EVIDENCE: Complainant’s exhibits 1-3, 8, 9, 11, 13, 15-17, 20, and 21 were admitted. Administrative Notice was taken of the Notice of Hearing packet and all of its documents contained therein.
_____________________________________________________________________
FINDINGS OF FACT
Mark Benz Custom Building and Remodeling LLC (Respondent) is the holder of License No. 296616 issued by the Registrar of Contractors (Registrar).
Complainant is a drywalling contractor.
On November 17, 2022, Complainant provided Respondent with a drywall bid for the Langer Residence (Langer), for a total of $69,182.00.
This bid was subsequently approved by Respondent on November 22, 2022.
On or about November 28, 2022, Complainant entered into a contract with Respondent to perform drywall work on Langer.
Respondent was familiar with Complainant’s work as they were working on a project together prior to contracting for Langer.
On January 31, 2023, Complainant entered into a contract with Respondent to perform drywall work on the Northview Residence (Northview).
On March 24, 2023, Complainant advised in a text message to Respondent that Langer and Northview were both completed.
On June 2, 2023, Complainant advised Respondent that the “touchup” work on Northview was completed.
Complainant was continually called back to the jobsites for additional patch work, some of which was to correct his own work, and others to correct the work of other trades.
On June 7, 2023 Respondent advised that there would be a “small delay” with issuing the checks requested by Complainant. Complainant was advised that its invoices were “at the top of [Respondent’s] prior list as [Respondent knew Complainant had] been waiting awhile...”
On June 8, 2023, Respondent replied that the matter was signed off for approval for payment and that it was then sent to Accounts Payable. The email further advised that Complainant “should receive payment shortly.”
On June 15, 2023, Respondent and Complainant exchanged text messages wherein Respondent advised he would have five checks ready by noon the following day. The checks were ultimately not paid.
On or about June 21, 2023, Respondent filed Complaint #2023-07312 and #2023-06963 with the Registrar alleging poor work on behalf of Complainant for work performed on Langer and Northview. Both Complaints were dismissed for denial of access to the jobsite.
On July 10, 2023, Complainant was terminated for convenience for Langer and Northview, pursuant to Section 12 of the Master Subcontractor Agreement.
Because Complainant was terminated for Convenience, Section 12 of the Master Subcontractor Agreement was triggered, stating: “Contractor shall pay Subcontractor for the Work performed under a Work Order to the date of such termination.”
Invoice 0086 showed an outstanding balance of $33,240.50 for Langer.
Invoice 0092 showed an outstanding balance of $23,320.00 for Northview.
Invoice 0114 showed an outstanding balance of $6,000.00 pursuant to change order #4 for Langer.
On or about August 22, 2023, Complainant filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the sum of $62,670.00 for drywall services.
The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a Citation for alleging a possible violation of Ariz. Rev. Stat. § 32-1154(A)(10).
Respondent never disputed the “back charges” on the invoices or any of the amounts Complainant alleged it was owed.
Respondent did not assert that it lacked the capacity to pay the amount Complainant asserted was due.
Respondent did not pay Complainant because of Complainant’s alleged poor workmanship and because Respondent was forced to hire another trade to complete the work.
HEARING EVIDENCE
Aldo Ramos, owner and superintendent of Lonestar Drywall LLC, testified on behalf of Complainant. Mr. Ramos testified that the total due to Complainant was $62,670.00, consisting of unpaid balances from the original contracts for Langer and Northview, as well as change orders, back charges and patch work. Mr. Ramos testified that the work was completed on or about March 2023, but he was continually called back to the projects to correct work other trades had damaged. He further testified consistently with the Findings of Fact.
Mark Benz, owner of Mark Benz Custom Building and Remodeling LLC, testified on behalf of Respondent. Mr. Benz testified extensively to the poor workmanship he experienced from Complainant. He further stated that he continually had Complainant return to the jobsites to attempt to fix his work. Mr. Benz stated that he subsequently terminated Complainant “for cause,” and that the Notice of Termination for Convenience was an error by his office.
Subsequent to firing Complainant, Mr. Benz hired another contractor to fix what he considered Complainant’s poor workmanship. He testified that he paid $50,000.00 out of his own pocket to make the repairs before the homeowner reimbursed him.
Ultimately, Mr. Benz stated, that the “work wasn’t done correctly, and [he] had to have someone else finish it for him. That’s why [he] didn’t pay him.”
Brianna Aman, project manager, testified on behalf of Respondent. Ms. Aman testified to what she believed was poor workmanship by Complainant. She further testified that Respondent hired another contractor to finish the work.
CONCLUSIONS OF LAW
The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these matters is 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.”
Ariz. Rev. Stat. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license,
[f]ailure by a licensee or agent or official of a licensee to pay monies in excess of $750 when due for materials or services rendered in connection with the licensee's operations as a contractor unless the licensee proves that the licensee lacks the capacity to pay and has not received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.
Emphasis added.
The evidence established that Respondent owed a total of $62,670.00 for drywall services, as this amount was not controverted.
The Termination for Convenience, issued on July 10, 2023, prompted payment to be due under Ariz. Rev. Stat. § 32-1154(A)(10).
Although Respondent alleged poor workmanship, all Registrar complaints were closed without any finding of poor workmanship. Therefore, the only remaining affirmative defense amounts to “a licensee’s lack of capacity to pay and not having received monies as payment for the particular construction work project or operation for which the services or materials were rendered”.
Respondent never claimed that it lacked the ability to pay Complainant for the work performed. Furthermore, the uncontroverted evidence was that Respondent was ultimately paid by the homeowner.
Therefore, Complainant established that Respondent violated Ariz. Rev. Stat. § 32-1154(A)(10) by failing to pay Complainant $62,670.00 for services or materials rendered in connection with Respondent’s contracting business.
Based upon Respondent’s violation of the provisions of Ariz. Rev. Stat. § 32-1154(A)(10), grounds exist to impose discipline against Respondent’s license.
RECOMMENDed order
Based on the foregoing, it is recommended that the Registrar suspend Mark Benz Custom Building and Remodeling LLC’s License No. 296616 issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $62,670.00 in certified funds.
It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $62,670.00 in certified funds, the Registrar may close the Complaint in Case No. 2023-09765.
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, April 19, 2024.
/s/ Amy M. Haley
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Tom Cole, Director
Registrar of Contractors
Logan Elia Esq.
[email redacted]
Richard Elley Esq.
[email redacted]
By: OAH Staff