ALJDEC - Licensing
2024A-00547-NPC-ROC · Registrar of Contractors · 2024-06-03
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Corkery LLC
COMPLAINANT,
v.
Seabold Construction Co Inc
License No. ROC 255678,
RESPONDENT.
No. 2024A-00547-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: May 13, 2024
APPEARANCES: Tom Corkery represented Complainant Corkery LLC (Complainant). Hailey Owens represented Respondent Seabold Construction Co Inc. (Respondent).
ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson
EXHIBITS ADMITTED INTO EVIDENCE: Exhibit A (the Arizona Registrar of Contractors (ROC or Registrar) administrative record.
FINDINGS OF FACT
1. On or about January 31, 2022, Complainant entered into an agreement with Respondent, wherein Complainant agreed to provide material and labor to Respondent in connection with Respondent’s operations as a contractor.
2. Complainant provided labor and materials as promised under the contract.
3. From June 2023 to November of 2023, Complainant issued invoices to Respondent. Respondent failed to pay Complainant a total of $102,313.40 for labor and materials provided to Respondent.
4. Complainant filed a complaint with the Arizona Registrar of Contractors (ROC) alleging that Respondent failed to pay for labor and services provided by Complainant in connection with Respondent’s operations as a contractor.
5. On February 20, 2024, the ROC issued a Citation against Respondent’s license. Through the Citation, the ROC alleged that Respondent may have violated Arizona Revised Statutes (A.R.S.) 32-1154(A)(10).
6. The matter was referred to the Office of Administrative Hearings for an evidentiary hearing.
7. A hearing was held on May 13, 2024.
8. At hearing, Tom Corkery testified on behalf of Respondent and presented the testimony of Complainant’s General Manager, Paul Dankowski. Hailey Owens testified on behalf of Respondent.
9. Mr. Dankowski explained that Respondent owes Complainant a total of $102,313.40. Ms. Owens did not dispute that Respondent owes Complainant $102,313.40. Ms. Owens stated that Respondent’s contract with Complainant provides that Respondent is not obligated to pay Complainant unless Respondnet is paid by the owner. Ms. Owens stated that Respondent has not been paid by owner. There was no written evidence of the contract between the parties presented at the hearing.
CONCLUSIONS OF 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. A.A.C. 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.” A.R.S.. § 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.” A.R.S.. § 1-211(B).
The purpose of the ROC’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).
A.R.S. § 32-1154(A) provides that:
The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: .... 10. Failure by a licensee or agent or official of a 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.
8. A.R.S. § 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 . . . 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.”
9. Payment for “[s]ervices rendered in connection with the licensee’s operations as a contractor” does not include interest, finance charges, lien charges, or other charges that are based solely on contract terms.
10. The preponderance of the evidence does not show that Respondent lacks the capacity to pay Complainant.
11. The preponderance of the evidence shows that Respondent violated A.R.S. § 32-1154(A)(10) as alleged.
12. Based upon Respondent’s violation of the provisions of A.R.S. § 32-1154(A)(10), grounds exist to impose discipline against Respondent’s license.
13. Because A.R.S. § 32-1154(A)(10) only includes a licensee’s failure to pay for materials or services rendered in connection with the licensee’s operations as a contractor, not late fees, interest, or other consequential or contractual damages, the Administrative Law Judge does not recommend that Respondent be required to pay late fees as a condition of keeping its contractor’s license in good standing.
RECOMMENDed order
Based on the foregoing, it is recommended that the ROC suspend license number 255678 held by Seabold Construction Co Inc, until it has provided to the ROC, and the ROC has accepted, documents that establish that it has paid Complainant $102,313.40 in certified funds.
It is further recommended that when and if the ROC receives and accepts Respondent’s evidence that it has paid Complainant in certified funds, the ROC may close the complaint in Case No. 2024A-00547.
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, June 3, 2024.
/s/ Velva Moses-Thompson
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Tom Cole, Director
Registrar of Contractors
Seabold Construction Co Inc.
[email redacted]
Corkery LLC
[email redacted]
By: OAH Staff