ALJDEC - Licensing

2023A-10584-NPC-ROC · Registrar of Contractors · 2024-04-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Desert Heat Excavating LLC,

COMPLAINANT

v.

US Pipelining LLC

License No. ROC 340686,

RESPONDENT

No. 2023A-10584-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 18, 2024

APPEARANCES: Shawn Kirby, Sr. and Shawn Kirby, Jr. appeared via Google Meet on behalf of Complainant Desert Heat Excavating LLC. Chase E. Halsey, Esq. appeared via Google Meet on behalf of US Pipelining LLC.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

EXHIBITS ADMITTED INTO EVIDENCE: Respondent’s Exhibits 1-3 were admitted into evidence.

_____________________________________________________________________

FINDINGS OF FACT

On December 18, 2023, the Registrar of Contractors (“ROC”) issued a Notice of Hearing on Contested Case setting the above-captioned matter for hearing on February 6, 2024 at the Office of Administrative Hearings.

The Notice of Hearing shows that the hearing was being conducted on the charges made in the complaint and citation that were served on Respondent US Pipeling LLC on November 14, 2023

Through the citation and Notice of Hearing, ROC alleges that Respondent may have violated Ariz. Rev. Stat. section 32-1154(A)(10).

Respondent holds License No. 340686 issued by ROC. Jeremy R. Bowman is a Member of Respondent’s LLC.

Complainant is Desert Heat Excavating LLC.

In April 2023, the parties agreed that Complainant would perform excavating services at a project on which Respondent was working.

On September 8, 2023, Complainant filed with ROC a complaint against Respondent alleging that Respondent owed Complainant $10,915.00.

At hearing, Shawn Kirby, Sr. and Shawn Kirby, Jr. testified on behalf of Complainant.

Mr. Kirby, Sr. testified that per the estimate provided on or about April 7, 2023, the bid excluded concrete and asphalt. Mr. Kirby, Sr. testified that this meant that it was a big umbrella meaning any damage which occurred to the existing concrete and asphalt from Complainant’s work would not be Complainant’s responsibility.

Mr. Kirby, Sr. also testified that he did not dispute that damage occurred during its work on the project.

Jeremy Bowman testified on behalf of Respondent. He testified that Respondent was a national company hired by the Biltmore Terrace to do pipeline work at the property.

Mr. Bowman testified that the outriggers dug down to the asphalt and caused damage. Further, Mr. Bowman testified that he received no response from Complainant when he tried to have Complainant make the repairs. Also, Mr. Bowman testified that there was no response to the August 1, 2023 correspondence he sent to Complainant.

In addition, Mr. Bowman testified that Biltmore Terrace then decided to hire another company, Sunland Asphalt, at a cost of $24,278.00 to make the repairs. Because of this, Biltmore Terrace withheld this amount from Respondent.

CONCLUSIONS OF LAW

Unless otherwise provided by law, a party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.

“At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(2).

A preponderance of the evidence is:

The 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.

Black’s Law Dictionary 1373 (10th ed. 2014).

Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).

Among the grounds for suspension or revocation of a contractor’s license is a “[f]ailure by [the] licensee . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee’s operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.” Ariz. Rev. Stat. § 32-1154(A)(10).

The preponderance of the evidence shows that Respondent owes Complainant more than $750.00 for materials purchased in connection with Respondent’s operations as a contractor.

Therefore, the only issue remaining is whether Respondent raised a sufficient justification or excuse for failing to pay Complainant on the invoices in question. This is an affirmative defense that Respondent bears the burden to establish. Here, Mr. Bowman testified credibly as to the damage cause by Complainant’s machines. Complainant also did not deny the same. Further, because of this damage, Respondent did not receive payment for the work Complainant was hired by Respondent to perform. Further, the wording in Complainant’s estimate was not sufficient to exclude any damages.

Therefore, the preponderance of the evidence shows that Respondent has not violated section 32-1154(A)(10), and no discipline should come to Respondent’s license. However, this does not necessarily alleviate Respondent’s responsibility to pay Complainant, and Complainant still may have other legal avenues to pursue the balance owed. Likewise, Respondent too may have a cause of action for the damages it suffered, however, both claims are outside the purview of the tribunal.

RECOMMENDED ORDER

IT IS RECOMMENDED that the Complaint against US Pipeline LLC’s license be dismissed.

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 2, 2024.

/s/ Adam D. Stone

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

Chase E. Halsey, Esq.

[email redacted]

Desert Heat Excavating LLC

[email redacted]

By: OAH Staff