ALJDEC - Licensing
2023A-12154-CHC-ROC · Registrar of Contractors · 2024-04-21
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Justin Johnson ,
COMPLAINANT
v.
360 Masonry & Hardscapes LLC
License No. ROC 338918,
RESPONDENT
No. 2023A-12154-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: April 2, 2024, 1:00 P.M.
APPEARANCES: Complainant Justin Johnson appeared on his own behalf; Mark Santizo, Managing Partner, appeared on behalf of Respondent
ADMINISTRATIVE LAW JUDGE: Roger Geddes
EXHIBITS ADMITTED INTO EVIDENCE: None submitted
_____________________________________________________________________
FINDINGS OF FACT
Background and Procedure
1. 360 Masonry & Hardscapes LLC (“Respondent”), is the holder of License Number 338918 issued by the Registrar of Contractors (“Registrar”).
2. On or about October 24, 2023, Justin Johnson (“Complainant”) filed a Complaint against Respondent with the Registrar alleging abandonment in connection with the construction of a block wall by Respondent at a residence in Phoenix, Arizona (“project”). The Complaint reflected a contract amount of $77,480.49.
3. The Registrar performed an inspection of the project on December 11, 2023. Thereafter, the Registrar issued a Directive, dated December 15, 2023, requiring Respondent to remedy the following violations by appropriate means by January 5, 2024:
Compliance Item 1: Rebar installed incorrectly; Never called for inspection after rebar installed; Job abandoned.
Investigator’s Observation: Respondent did not appear for inspection. Project is not complete. Respondent should complete their scope of work by appropriate methods and in accordance with contract, executed change orders, specifications, drawings, building code/requirements of the local building authority (permit/inspection), manufacturer recommendations, industry and workmanship standards. Respondent should provide this Investigator with documentation of passed final permit for their scope of work.
Governing Rule: A.R.S. §32-1154 (A) (1), Abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal. ARS §32-1154 (A) (3), Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(b): A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. For work to be performed in accordance with professional industry standards, a contractor shall use such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly licensed contractor possessing ordinary skill and capacity. A.R.S. §32-1154 (A) (8), Failure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract.
4. After the expiration of the time period in the Directive and after being informed by Complainant that no work had been performed by Respondent, the Registrar then issued a Citation to Respondent dated, January 22, 2024, for the alleged violation of the following:
a. A.R.S. § 32-1154(A)(1) (abandonment of a contract or refusal to perform without legal excuse);
b. A.R.S. § 32-1154(A)(3) (violation of Arizona Administrative Code Rule 4-9-108(b) for failure to perform all work in accordance with any applicable building codes and professional industry standards);
c. A.R.S. § 32-1154(A)(8) (failure in a material respect to complete a construction project or operation for the price stated in the contract);
d. A.R.S. § 32-1154(A)(22) (failure to perform corrective action without valid justification).
5. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing for April 2, 2024, at 1:00 P.M.
6. At the April 2, 2024, Complainant Justin Johnson testified on his own behalf; Mark Santizo, Managing Partner, testified on behalf of Respondent. Lisa Melton, the Registrar Investigator (Investigator), testified on behalf of the Registrar. Neither party submitted exhibits.
7. The Investigator testified on behalf of the Registrar consistently with her findings contained in the Directive and his job inspection notes. Specifically, she testified that no work had been performed since June 2022 and that as a consequence she cited Respondent for a failure to perform work diligently as well as abandonment. She stated Complainant paid $25,568.00 of a $77,000.00 contract
8. Complainant Justin Johnson testified, as herein relevant to the Citation, that after permitting, Respondent dug the footings and put rebar in for the block wall but never called for inspection for the concrete to be poured and then did no further work. He stated his last contact with Respondent was in March 2023 but never heard from them again. He further testified that had hired someone else to finish the wall who had to remove the rebar because they stated it was too rusted to use.
9. Mark Santizo, testified on behalf of Respondent, as herein relevant to the Citation, that everything stated was accurate but that he does not feel the project was abandoned. He stated the project occurred during the pandemic and that there was a lot of permitting issues that they faced.
10. Administrative notice is taken of Respondent’s license record on the Registrar’s web site which reflects that Respondent’s License No. 338918 was first issued on June 21, 2022, and is in active status. Such license record also reflects two Open Cases, no Disciplined Cases, and no Resolved/Settled cases.
CONCLUSIONS OF LAW
1. The Registrar has jurisdiction over this matter, pursuant to A.R.S. § 32-1101, et seq., which authorizes the Registrar to impose disciplinary sanctions against licenses for violations of A.R.S. § 32-1154.
2. 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 preponderance of the evidence. See Arizona Administrative Code Rule 2-19-119.
3. To warrant such sanctions by the Registrar, Complainant must demonstrate by a preponderance of the evidence that Respondent violated the statutory section cited. Proof by a “preponderance” means that “the evidence is sufficient to persuade the finder of fact that the proposition is more likely true than not.” In re: Arnold and Baker Farms, 177 B.R. 648 (9th Cir. BAP (Ariz.) 1994). See also Culpepper v. State of Arizona, 187 Ariz. 431, 930 P.2d 508 (App. 1996). It is “evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” BLACK’S LAW DICTIONARY 1182 (Rev. 6th ed. 1990).
4. A.R.S. § 32-1154(A) includes in pertinent part among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, any of the following acts:
1. Abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.
...
3. Violation of any rule adopted by the registrar.
...
8. Failure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract.
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22. Failure to take appropriate corrective action to comply with his chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.....
5. With regard to the “violation of any rule adopted by the registrar” under A.R.S. § 32-1154(A)(3) referenced in the Citation, the rule allegedly violated in this case was Arizona Administrative Code Rule 4-9-108(b) which requires that “[a] contractor shall perform all work in accordance with any applicable building codes and professional industry standards.”
6. A.R.S. § 32-1154(A)(1). Complainant has presented sufficient evidence to establish that Respondent abandoned the contract or refused to perform without legal excuse in violation of A.R.S. § 32-1154(A)(1). Respondent conceded it did not complete the project and did not refute the evidence presented that no work had been performed since June 2022.
7. A.R.S. § 32-1154(A)(3). Complainant has not presented sufficient evidence to establish that Respondent failed to perform all work in accordance with any applicable building codes or professional industry standards in violation of Arizona Administrative Code Rule 4-9-108(b). The Investigator testified that Respondent’s violation in this regard was not a building code violation, but rather a failure to perform work in accordance with professional industry standards due to not proceeding diligently to complete the project. However, there was no evidence presented of any particular standard that was violated. Such a vague reference to an unspecified industry standard is insufficient to find a violation here.
8. A.R.S. § 32-1154(A)(8). Complainant has not presented sufficient evidence to establish that Respondent has failed in a material respect to complete a construction project for the price stated in the contract in violation of A.R.S. § 32-1154(A)(8). There was no dispute that Respondent abandoned the project and failed to complete it. However, this statute specifies the violation to be a failure to complete a project “for the price stated in the contract.” Respondent did not complete the project irrespective of the price stated in the contract. However, the Tribunal does not believe the Legislature intended a project abandonment to also be a violation of A.R.S. § 32-1154(A)(8). If it did, then every abandonment of a contract under A.R.S. § 32-1154(A)(8) would also be a violation of a failure to complete the contract under A.R.S. § 32-1154(A)(8), and would then render one of the subsections superfluous.
9. A.R.S. § 32-1154(A)(22). Complainant has presented sufficient evidence to establish that Respondent failed to perform any corrective action without a valid justification, and consequently should be disciplined for a violation of A.R.S. § 32-1154(A)(22). There was no dispute that corrective work was not performed and there was no evidence presented to support a valid justification for failing to do so. While Respondent maintained that the wall could not have been finished during the time period specified in the Directive, there was no evidence presented that Respondent undertook to even start the corrective work or inform the Investigator that additional time would be needed. Further, Respondent alluded to the pandemic as a justification for not completing the project. However, the Directive expiration was in January 2024, well after the pandemic period of time that had significant impact on construction projects.
10. Accordingly, Complainant has met his burden of proof to establish that Respondent’s license should be disciplined for a violation of A.R.S. § 32-1154(A)(1) and A.R.S § 32-1154(A)(22).
RECOMMENDED ORDER
Based on the foregoing, it is recommended that on the effective date of this Order, 360 Masonry & Hardscapes LLC’s, License Number 338918 is suspended for two (2) days.
IT IS FURTHER RECOMMENDED that pursuant to A.R.S. § 32-1154(E), Respondent must pay to the Registrar, a civil penalty of $250.00 in certified funds on or before 30 days from the effective date of this Order.
IT IS FURTHER RECOMMENDED that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s final 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 A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of the outstanding prior civil penalty.
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 22, 2024.
/s/ Roger Geddes
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Tom Cole, Director
Registrar of Contractors
c/o Legal Department
1700 W. Washington Street, Suite 105
Phoenix, AZ 85007
[email redacted]
360 Masonry & Hardscapes LLC
[email redacted]
Justin Johnson
[email redacted]
By: OAH Staff