ALJDEC - Licensing
2023A-13009-CHC-ROC · Registrar of Contractors · 2024-10-11
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Howard Kesselman,
COMPLAINANT,
v.
Lewis House Solutions LLC
dba Prescott Window & Door
ROC License No. 299139,
RESPONDENT.
No. 2023A-13009-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: September 27, 2024 at 9:00 AM.
APPEARANCES: Howard Kesselman (“Complainant”) appeared on his own behalf. Richard Lewis appeared on behalf of Lewis House Solutions LLC (“Respondent”). Nicole Gean observed.
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, August 05, 2024, Notice of Investigator Unavailability, and August 19, 2024, Hearing Order were admitted into the 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 June 17, 2015, the Registrar issued License No. 299139 Specialty Dual CR-61 Carpentry, Remodeling and Repairs contracting license to Respondent. The license had been renewed through June 30, 2025. Richard A. Lewis is listed as the Qualifying Party and Member on the license. Lori Jean Lewis is also listed as a Member on the license. Respondent’s address of record for the license is P.O. Box 4094 Prescott, Arizona 86302. Respondent has an active $6,750.00 surety bond on the license issued by RLI Insurance Company, effective May 13, 2015. The license has not been previously disciplined. No prior complaints have been filed against the license. Currently, the license has one (1) open complaint against it; which is presumed to be related to this matter.
In or around early-November 2023, the Registrar received a brief narrative complaint from Complainant against Respondent’s License No. 299139 alleging poor work regarding a residential remodeling project. On November 10, 2023, Complainant submitted a more detailed complainant to the Registrar regarding his allegations against License No. 299139. The Registrar designated it Complaint No. 2023-13009 and assigned to Jim Dimond (“Investigator Dimond”) for investigation.
On November 16, 2023, Investigator Dimond issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on December 01, 2023, at 10:00 a.m. Correspondence was not returned as undeliverable to Respondent.
On December 01, 2023, Investigator Dimond inspected the work that had been performed on the project to date. Respondent was not present. Investigator Dimond also reviewed the contract-related correspondence between the parties, and took 11 photographs of the project site. When he was finished, Investigator Dimond drafted his Inspection Notes. Ultimately, Investigator Dimond derived four (4) separate and distinct complaint items from Complaint No. 2023-13009, of which he substantiated three (3) based on his firsthand observations. Specifically, Investigator Dimond determined that Respondent’s workmanship on complaint items 1-2 and 4 fell below the Registrar’s minimum workmanship standards and required remediation by Respondent.
On March 25, 2024, Investigator Dimond issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated most of Complainant’s complaint allegation(s) against Respondent. Respondent was put on notice that it had until 5:00 p.m. on April 12, 2024, 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 April 19, 2024, Investigator Dimond issued a Closure Letter from the Registrar that noted Complaint No. 2023-13009 would be closed because it received correspondence from Respondent indicating that "the manufacturer is going to replace the door in the next 60 days.” The purported correspondence received was not verified with Complainant.
Sometime around late-June 2024, Complainant notified Investigator Dimond that the project had not been remediated by Respondent or the product manufacturer, and asked that Complaint No. 2023-13009 be reopened. The Registrar obliged.
On July 16, 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 July 31, 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 July 31, 2024, the Registrar received a timely Answer from Respondent whereby Respondent argued the following, in pertinent parts:
In July, we were verbally told we would receive the door in August. However, we did not receive a confirmation of that until we requested it again this morning.
We did not receive an email from the ROC regarding the renewal of this case. The first-class mailing arrived yesterday afternoon.
All the written complaints, except for the scratches in the sidelites, would have been resolved by this point, except for the promise made by the factory rep and the wholesale rep that they would replace the door system. [Complainant] does not realize it, but we at [Respondent] have been his advocate, demanding that they follow through on their promise.
At this time, we have been told that we will receive the new door in August.
On July 31, 2024, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on September 24, 2024. Per the August 05, 2024, Notice of Hearing on Contested Case (“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. Richard Lewis testified on behalf of Respondent. The substantive evidence of record is as follows:
Complainant owns residential property located at 915 Copper Basin Rd. Prescott, Arizona 86303.
On August 11, 2022, the parties entered into a $23,380.30 contract for Respondent to replace all of the exterior windows in Complainant’s residence, as well as a small number of windows on the interior of the home, and replace Complainant’s front door. On September 07, 2022, a Change Order was executed regarding the lack of egress window openings in the office and guest bedroom. The modification increased the contract price to $27,240.49. On November 21, 2022, a $593.30 Change Order was executed for the removal and replacement of Complainant’s laundry room door panel.
Work on the project commenced on or about November 22, 2022, and stopped or was otherwise completed on July 26, 2023.
On August 30, 2022, Complainant tendered a $10,425.00 deposit to Respondent towards their contract. On December 12, 2022, Complainant tendered $16,815.49 to Respondent towards their contract. On December 15, 2022, Complainant tendered $8,291.85 to Respondent towards their contract. On June 26, 2023, Complainant tendered $2,578.23 to Respondent towards their contract.
Respondent received notification regarding the Registrar’s scheduled jobsite inspection, but failed to attend due to a miscalendaring error.
Respondent did not attempt to perform any corrective work on the project between March 25, 2024, and April 12, 2024
At no point during the Directive’s compliance period, or anytime thereafter, did Respondent allege a denial of access to the project site to the Registrar.
Additional Evidence
The parties agree that Complainant’s financial obligation on the underlying project has been satisfied, as no balance remains unpaid.
Sometime during the third week of September 2024, a new door was delivered to the project site, but was not installed. Shortly thereafter, Respondent issued Complainant a new $1,300.00 contract proposal for the installation of said door. Complainant did not sign or accept the proposal.
Closing Arguments
In closing, Respondent opined that it “could not have done more” and argued that it did not want to compensate Complainant for the door installation.
In closing, Complainant argued that he had sustained his burden of proof in the matter, and opined that an order should be issued in his favor so that he could access the Registrar’s Recover Fund and have his project properly remediated by another licensed contractor.
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) holds, 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 holds that no 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 the parties had a residential remodeling contract that primarily focused on the replacement of windows and Complainant’s front door, which Complainant paid in full. It is also clear that on review it was determined that some of Respondent’s work fell below the Registrar’s standards, which resulted in the issuance of a Directive. It is further clear from the record that Respondent failed to comply with the Directive.
Therefore, the only issue in dispute is whether Respondent raised a sufficient justification or excuse for failing to comply with the Registrar’s Directive and perform corrective work on Complainant’s project to comport with the score of work outlined in the parties’ contract. This is an affirmative defense that Respondent bears the burden to establish. Here, Respondent did not sustain its burden. There is no evidence in the record that excuses or otherwise justifies Respondent’s inaction and/or lack of performance on this project. Mr. Lewis’ assertion that Complainant’s issues were solely manufacturer-related are inaccurate, as is his contention that but for information received from the manufacturer Respondent would have performed corrective work on the project. Respondent was never prohibited from performing corrective work, or at a minimum, asking the Registrar for an extension of time to comply.
Because Complainant has established Respondent’s violation(s) of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22) 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 in this matter.
RECOMMENDED ORDER
Based on the foregoing,
IT IS RECOMMENDED that five days after the effective date of the Final Order in this matter, Respondent Lewis House Solutions LLC, ROC License No. 299139, be suspended for two (2) business days.
It is further recommended that the Registrar require Respondent to pay the sum total of one hundred dollars ($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 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.
Done this day, October 11, 2024.
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]
Lewis House Solutions LLC, Respondent
DBA: Prescott Window & Door
PO Box 4094
Prescott, AZ 86302
[email redacted]
Howard Kesselman, Complainant
915 Copper Basin Rd.
Prescott, AZ 86303
[email redacted]
By: OAH Staff