ALJDEC - Licensing

2023A-13357-CHC-ROC · Registrar of Contractors · 2024-04-04

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Randall Irvine,

COMPLAINANT,

v.

Bill's Pool Service Inc.

dba Money's Worth Pool Construction

ROC License No. 127739

RESPONDENT.

No. 2023A-13357-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: April 04, 2024 at 9:00 AM.

APPEARANCES: Randall Irvine (“Complainant”) appeared on his own behalf. David Fagerburg appeared on behalf of the Arizona Registrar of Contractors (“Registrar”). No appearance(s) by or on behalf of Bill’s Pool Service Inc. (“Respondent”).

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

EXHIBITS ADMITTED INTO EVIDENCE: The Notice of Hearing, including the Registrar’s attached agency file, was admitted into the record along with a Hearing Order issued by the Tribunal March 21, 2024.

_____________________________________________________________________

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 November 17, 1997, the Registrar issued License No. 127739 General Residential B-5 Swimming Pool contracting license to Respondent. The license had been renewed through November 30, 2025. William Miles Griffin Jr. is listed as the Qualifying Party and Officer on the license. Carol Ann Griffin is also listed as an Officer on the license. Respondent’s address of record for the license was 515 E. Carefree Hwy., PMB 356 Phoenix, Arizona 85085. Respondent has an active $9,000.00 surety bond on the license issued by Platte River Insurance Company, effective October 13, 2023. The license has been disciplined on one (1) prior occasion, and has settled or otherwise resolved two (2) prior complaints. Currently, the license has two (2) open complaints against it; one of which is presumed to be related to this matter.

On November 21, 2023, the Registrar received a narrative complaint from Complainant against Respondent’s License No. 127739 alleging abandonment and poor work of a residential in-ground pool project. The Registrar designated it Complaint No. 2023-13357 and assigned to David Fagerburg (“Investigator Fagerburg”) for investigation.

On November 27, 2023, Investigator Fagerburg issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on January 09, 2024, at 11:30 a.m. Correspondence was not returned as undeliverable to Respondent.

On December 10, 2023, Complainant submitted a 5-item addendum complaint to the Registrar.

On January 09, 2024, Investigator Fagerburg inspected the work that had been performed on the project to date. Respondent was present. Investigator Fagerburg also reviewed the contract-related correspondence between the parties, and took 17 photographs of the project site. When he was finished, Investigator Fagerburg drafted his Inspection Notes. Ultimately, Investigator Fagerburg derived a total of 12 separate and distinct complaint items from Complaint No. 2023-13357, three (3) of which he substantiated based on his firsthand observations. Specifically, Investigator Fagerburg determined Respondent’s workmanship on complaint items 1-2 and 10 failed to meet the Registrar’s minimum standards and required Respondent to perform corrective and/or completion work to remediate the identified deficiencies. None of Complainant’s addendum complaint items were substantiated by Investigator Fagerburg.

On January 17, 2024, Investigator Fagerburg issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated some of Complainant’s complaint allegation(s) against Respondent. Respondent was put on notice that it had until 5:00 p.m. on February 08, 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 February 12, 2024, Investigator Fagerburg issued a Compliance Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on February 14, 2024, at 1:30 p.m. Correspondence was not returned as undeliverable to Respondent.

On February 14, 2024, Investigator Fagerburg inspected the corrective work that had been performed on the project and took 5 photos. Respondent was not present. When he was finished, Investigator Fagerburg drafted his Compliance Jobsite Inspection Notes. Ultimately, Investigator Fagerburg determined that Respondent had satisfactorily remediated complaint item 10 by hiring an appropriately licensed subcontractor to perform corrective work, but that complaint items 1-2 remained outstanding.

On February 15, 2024, Investigator Fagerburg issued a Warning Letter to Respondent for an alleged violations of Ariz. Rev. Stat. §§ 32-1151 and 32-1154(A)(17) for allegedly contracting while its license was suspended.

On February 15, 2024, Investigator Fagerburg forwarded the matter to the Registrar’s legal department with the issuance of a Citation Recommendation.

On February 15, 2024, 2023, 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), 32-1154(A)(17) and 32-1154(A)(22). Respondent was given until March 01, 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 February 20, 2024, the Registrar received Respondent’s timely Answer whereby Respondent argued that its remediation of complaint item 10 was “a warranty deal” and therefore not Ariz. Rev. Stat. §§ 32-1151 and 32-1154(A)(17) violations. Respondent did not address substantiated complaint items 1-2.

On February 21, 2024, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on April 03, 2024. Per the February 27, 2024, 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)(17)

Charge 3: A.R.S. § 32-1154(A)(22)

Hearing Evidence

Complainant testified on his own behalf and called Investigator Fagerburg as a witness. Although afforded a ten (10) minute grade period, no witness(es) appeared on behalf of Respondent. The substantive evidence of record is as follows:

Complainant owns residential property located at 27801 N. Deseierto Dr. Rio Verde, Arizona 85263.

On May 18, 2022, the parties entered into a $78,791.26 pool installation contract. Terms included a cover for the pool. Complainant paid the contract in full.

On or about April 10, 2023, a Change Order was executed for the installation of travertine tile. Complainant paid the Change Order in full.

License No. 127739 was suspended by the Registrar from January 10, 2024, to March 01, 2024, in an unrelated matter. On March 02, 2024, the license went back into active status.

On an unknown date between January 17, 2024, and February 08, 2024, Respondent hired a subcontractor to perform corrective work on substantiated complaint item 10. Complainant was satisfied with the subcontractor’s workmanship.

At no point in time did Respondent allege a denial of access to the project site to the Registrar during the Directive’s compliance period, or request an extension thereof to the agency.

The parties did not enter into a financial settlement agreement regarding substantiated complaint items 1-2.

Additional Evidence

Complainant testified that, on an unknown date, Respondent advised it was “too broke” to obtain the contracted pool cover for the project.

Closing Argument

In closing, Complainant opined that Respondent had abandoned his project and had poorly performed the work that had been done. As such, Respondent asked for an order of restitution and the revocation of Respondent’s license.

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)(17) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[c]ontracting or offering to contract or submitting a bid while the license is under suspension or while the license is on inactive status.”

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 pool installation contract that Complaint paid in full. It is also clear from the record that the project was incomplete and that there were deficiencies in Respondent’s work that required correction. It is further clear from the record that Respondent did not fully comply with the Registrar’s Directive, or request an extension thereof.

Therefore, the only issue in dispute is whether Respondent raised a sufficient justification or excuse for failing to adhere to the Registrar’s Directive and complete Complainant’s project per 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. Respondent accepted Complainant’s full payment for the motorized pool cover at issue, which included third-party installation, well in advance of License No. 127739’s suspension by the Registrar. Moreover, there is no clear explanation for why Respondent did not address complaint items 1-2 on or after March 02, 2024, when the license returned to active status.

There is, however, exigent or otherwise mitigating evidence that exists in the record in favor of Respondent. Specifically, a violation of Ariz. Rev. Stat. § 32-1154(A)(17) has not been established by a preponderance of the evidence. Respondent’s delegation of corrective work regarding substantiated compliant item 10, is not per se or de facto “contracting,” rather, it constitutes work permitted under warranty for existing work.

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 Bill's Pool Service Inc., ROC License No. 127739, be suspended for five (5) business days.

It is further recommended that the Registrar require Respondent to pay the sum total of $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.

NOTICE

Pursuant to Ariz. Rev. Stat. § 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 05, 2024.

Office of Administrative Hearings

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Tom Cole, Director

c/o Legal Department

Registrar of Contractors

1700 W. Washington St., Ste. 105

Phoenix, AZ 85007

[email redacted]

Randall Irvine, Complainant

27801 N. Desierto Dr.

Rio Verde, AZ 85263

[email redacted]

Bill's Pool Service Inc., Respondent

515 E. Carefree Hwy. PMB 356

Phoenix, AZ 85085

[email redacted]

By: OAH Staff