ALJDEC - Licensing

2025A-00117-CHC-ROC · Registrar of Contractors · 2025-07-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Stephen Swerid,

COMPLAINANT,

v.

BlackWater Contracting, LLC

License No. ROC 334585,

RESPONDENT.

No. 2025A-00117-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: July 2, 2025

APPEARANCES: Complainant Stephen Swerid appeared on his own behalf. Respondent Blackwater Contracting, LLC did not appear. Arizona Registrar of Contractors Investigator David Fagerburg appeared as a witness.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

EXHIBITS ADMITTED INTO EVIDENCE: None

FINDINGS OF FACT

Blackwater Contracting, LLC (“Respondent”) is the holder of License Number 334585 issued by the Arizona Registrar of Contractors (“Registrar”).

On or about May 28, 2024, Stephen Swerid (“Complainant”) contracted with Respondent for Respondent to perform remodel work at Complainant’s home, including mill work, painting, drywall, plumbing, lighting, and the removal of a wall.

On or about January 8, 2025, the Registrar received a Complaint against Respondent from Complainant alleging abandonment and poor work with respect to the project.

The Registrar assigned the Complaint to Investigator David Fagerburg. After a February 6, 2025 Jobsite Inspection, Investigator Fagerburg issued a Written Directive to Respondent dated March 18, 2025, that provided as follows:

After investigation, the Registrar determined that you failed to meet the requirements of A.R.S. § 32-1154(A), and now issues this Directive requiring you to take appropriate corrective action. Failure to comply with this Directive constitutes a violation of A.R.S. § 32-1154(A)(22) and may result in the issuance of a citation, discipline of your license, and a civil penalty pursuant to A.R.S. § 32-1154(E) of up to $500.00. You must notify the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on Friday April 18, 2025.

Investigator Note:

1: Upon reviewing the written estimates and scope of work submitted by the complainant I am able to verify there is at least 1 of the 9 minimum elements of a contract missing violating ARS §32-1158 (A) Minimum elements of a contract.

Specifically #2, #4, and #9. Warning letter issued.

You are directed to remedy the following violations by the appropriate means:

Complaint Item 2: Tub was supposed to be properly installed and secured as discussed. It was not properly set and easily moves around..

Investigator’s Observation: At this jobsite investigation I observed a bath tub installed in the primary bathroom that is loose and not adequately secured. See P (17) thru P (19). During this jobsite investigation the complainant acknowledged the post tension concrete slab was jack hammered out for the tub drain line modification by the complainant. Upon reviewing the written estimates and scope of work provided I am able to verify the specification states, “Plumb drain line to accept waste line for a freestanding tub in the primary. (Home is post tension and will have to use and extension to drain the tub) Reroute water lines to the backside of the tub under the window for a wall mounted tub filler and handheld in the primary. (If water lines are coming from underground outside of a wall cavity we may need to have a locating company come out to identify cables in the post tension slab in order to reroute them. After tile, Set customer provided tub and customer provided wall mount filler in the primary. Reroute underground water lines into the wall dividing the water closet. (Customer to remove concrete. Post tension slab)”. Prior to any corrective work or completing the tub installation the respondent shall obtain a permit from the City of Phoenix Planning and Development Department, comply with all requirements, pass all inspections and correct the tub that is not adequately secured by appropriate means.

Complaint Item 3: Lighting was removed by contractor and did not return with gimble light fixture

Investigator’s Observation: At this jobsite investigation the complainant showed me the location where a gimbal light fixture has been removed in a hallway wall niche. See P (20). Prior to this jobsite investigation on January 16, 2025 the respondent sent an email and provided screenshots of texts discussing the missing light fixture and that the lighting provider the respondent goes to didn’t have anything for low voltage on a gimbal assembly. It is more likely that not that the respondent was to provide a low volt gimbal light fixture. The respondent shall ensure a low volt gimbal light fixture is installed in the hallway wall niche by appropriate means.

Complaint Item 6: poor electrical workmanship with crooked junction boxes

Investigator’s Observation: At this jobsite investigation I observed and am able to verify there are 2 electrical J-boxes installed that are crooked in the primary bathroom and kitchen entry. The cover plate at the kitchen entry is not flush with the drywall. See P (23) thru P (25). During this jobsite investigation the complainant stated that the 1 of the 2 gang switches at the kitchen entry was added during the remodel project. Prior to any corrective work related to any electrical system additions or modifications the respondent shall obtain a permit from the City of Phoenix Planning and Development Department, comply with all requirements, pass all inspections and correct the 2 crooked electrical J-boxes by appropriate means.

Complaint Item 7: Installed new light fixture above tub and did not wire to wall switch

Investigator’s Observation: At this jobsite investigation I observed a light fixture installed above a bathtub in the primary bathroom that does not operate on a separate switch. See P (26) and P (27). The complainant stated that the switch is existing and was to be used for the new light fixture. Prior to this jobsite investigation on January 16, 2025 the respondent sent an email and provided screenshots of texts showing discussion related to the light fixture above the tub stating “I have not heard back from my electrician for the tub light”. In the email the respondent stated “the light above the tub was already on a switch. We just covered installation of the light fixture, not what switch operated it. It was discussed between Stephen and myself and I had told him I would get my electrician to look at changing the tub light fixture to be operated by an independent switch. However, they cut communication before I could get him back out there”. It is more likely that not that the new light fixture above the primary bath tub is to operate on a separate switch. The respondent shall ensure the new light fixture above the primary tub operates on a separate switch by appropriate means.

Complaint Item 8: charged for relocation of under cabinet lighting and did not do the work

Investigator’s Observation: At this jobsite investigation the complainant showed me what appears to be old existing under cabinet light fixtures installed in the kitchen. See P (28). Upon reviewing the written estimates and scope of work provided I am able to verify there is a specification for the relocation of under cabinet lighting into a 3 gang box at the kitchen entry. Prior to any corrective work related to any electrical system additions or modifications the respondent shall obtain a permit from the City of Phoenix Planning and Development Department, comply with all requirements, pass all inspections and complete the project per written estimate scope of work by appropriate means.

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item 1: Blackwater Contracting did not complete the job. Trim work throughout home needs to be addressed.

Investigator’s Observation: At this jobsite investigation I observed door casing and baseboard installed throughout the interior of the home excluding the windows. The complainant stated that the scope of work included casing to be installed around all the windows and showed me left over materials in the garage. See P (3) thru P (16). Upon reviewing the written estimates and scope of work provided I am able to verify there is no specification to install window casing, only baseboard and door casing. Prior to this jobsite investigation on January 16, 2025 the respondent sent an email and provided screenshots of texts. In 1 of the screenshots dated December 5 the complainant wrote, “I purchased the paint on Tuesday and have painted. In another text the complainant wrote, “we replaced all the casing and baseboards as per quote. If we can’t get the work done no

sense sending anyone”. The respondent replied, “Casing on doors not windows the estimate specified Baseboard and door casing.” It appears the respondent was told not to return to complete the baseboard and door casing installation and the complainant completed the painting.

Complaint Item 4: Charged for shower plumbing. Home owner did the work

Investigator’s Observation: At this jobsite investigation the complainant acknowledged performing the plumbing work for the primary shower. Upon reviewing the written estimates and scope of work provided I am able to verify there is a specification to remove and replace with customer supplied delta cartridge and trim kit in the primary shower. Prior to this jobsite investigation on January 16, 2025 the respondent sent an email and provided screenshots of texts showing credits for some of the scope of work that was not completed. The ROC cannot direct a contractor to provide refunds for work performed by the complainant and does not get involved in financial disputes.

Complaint Item 5: Did not properly install niche for subwoofer

Investigator’s Observation: At this jobsite investigation in the family room of the home the complainant showed me where a subwoofer is located that does not fit the space and hangs over the front of the niche. See P (21) and P (22). Prior to this jobsite investigation on January 16, 2025 the respondent sent an email and provided screenshots of texts showing an agreement was made to relocate electrical switches and outlets in 2 bathrooms as a credit towards the cost of correcting the niche for the subwoofer.

Complaint Item 9: Damaged stereo equipment

Investigator’s Observation: At this jobsite investigation the complainant

acknowledged the damaged stereo equipment has been disposed of.

All errors in original.

Following the expiration of the Written Directive, Investigator Fagerburg ascertained that Respondent did not comply with the Written Directive. Thereafter, Investigator Fagerburg forwarded the matter to the Registrar’s Legal Department. The Registrar issued a Citation against Respondent charging possible violations of A.R.S. § 32-1154(A)(2)(b), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(a), A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158, and A.R.S. § 32-1154(A)(22).

The Registrar referred the matter to the Office of Administrative Hearings, an independent State agency, for an evidentiary hearing.

On May 22, 2025, the Registrar issued the Notice of Hearing advising the parties of the hearing date and time, and that the Office of Administrative Hearings would issue a Google Meet link for participation in the hearing. The Notice of Hearing was sent to Respondent’s mailing and email addresses of record with the Registrar.

On May 28, 2025, the Tribunal issued to the parties an Order Setting Hearing Via Google Meet. That Order contained the Google Meet link to join the hearing by video or phone.

The hearing of this matter was scheduled to convene on July 2, 2025, at 9:00 a.m. On the date and at the time set for hearing, Complainant appeared on his own behalf. Investigator Fagerburg was also present. Respondent did not appear through an authorized member, employee, or attorney. Respondent did not request that the hearing be continued. Because Respondent failed to appear, Respondent did not present any evidence to defend its license.

Investigator Fagerburg testified consistently with his findings contained in the Written Directive. Investigator Fagerburg testified that the project required a permit as there were modifications to electrical and plumbing. Specifically, in the bathroom, the plumbing needed to be modified to accommodate the new bathtub.

Investigator Fagerburg further testified that he received an email from Respondent on April 23, 2025, after the expiration of the Written Directive, stating that Respondent had applied for a permit. However, Respondent did not provide any documentation establishing such and Respondent did not request an extension to the Written Directive deadline.

Investigator Fagerburg explained that he did not verify Complaint Item Number 1 because the parties’ contract did not contain any provision regarding the window casings, although there was material for such in the garage.

Investigator Fagerburg found that Respondent’s contract was lacking several required elements of a contract, specifically the jobsite address, an estimated completion date for the project, and the advisement regarding the right to file a complaint with the Registrar and information regarding how to do so

Complainant testified that he agreed with Investigator Fagerburg’s testimony. Complainant testified that Respondent measured the windows and that the millwork is incomplete. Complainant acknowledged that installation of the casings for the windows is not contained within the scope of work in the contract, however, there was a significant amount of material left over for that purpose. Complainant further testified that none of the work is “remotely close to being done,” that this has been a “horrible” experience, Respondent should not be in business, and Respondent should be held accountable.

Administrative notice is taken of Respondent’s prior License record on July 17, 2025. Such prior License record reflects that Respondent’s License Number 334585 was first issued on August 25, 2021, and is active. Such prior License record also reflects that there is only the instant open Complaint, no resolved/settled complaints, and no discipline against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”

The credible and probative evidence of record established that Respondent failed to obtain the proper permits for the project. Therefore, Complainant established that Respondent departed from or disregarded a building code of this state or any political subdivision of this state in a material respect that was prejudicial to Complainant, in violation of A.R.S. § 32-1154(A)(2)(b).

The credible and probative evidence of record established that Respondent’s work was not in conformity with the Registrar’s standards. Therefore, Complainant established that Respondent did not complete the project in a professional and workmanlike manner in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(a).

The evidence established that Respondent’s contract for the project failed to include three statutorily required elements. Therefore, Complainant established that Respondent failed to comply with the Registrar’s statute in violation of A.R.S. § 32-1154(A)(12).

The evidence established that Respondent did not complete the corrective work following the issuance of the Written Directive and that valid justification for such failure did not exist. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a Written Directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent’s License Number 334585 for a period of seven (7) days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty (30) 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)(7), unless Respondent tenders payment of any outstanding prior civil penalty.

It is further recommended that, on or before thirty (30) days after the effective date of the final order, Respondent shall provide a sample contract to the Registrar to demonstrate that it has amended its contracts to include the nine (9) terms required by A.R.S. § 32-1158(A). If Respondent fails to establish to the Registrar that it has brought its contracts into compliance with A.R.S. § 32-1158(A) within thirty (30) days, its contractor’s license shall be suspended until it demonstrates that it has done so.

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, July 18, 2025.

/s/ Sondra J. Vanella

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

David Fagerburg

[email redacted]

BlackWater Contracting, LLC

[email redacted]

Stephen Swerid

[email redacted]

By: OAH Staff