ALJDEC - Licensing

2025A-01220-CHC-ROC · Registrar of Contractors · 2025-07-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Leroy Wilkerson and Jill Wilkerson,

COMPLAINANTS,

v.

First Option Design Build, LLC

License No. ROC 316047,

RESPONDENT.

No. 2025A-01220-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: June 16, 2025

APPEARANCES: Complainants Leroy and Jill Wilkerson appeared on their own behalf. Paul Zimmerman appeared on behalf of Respondent First Option Design Build, LLC. Arizona Registrar of Contractors Investigator Charles Riddlehoover appeared as a witness. Michael Reese appeared as a witness.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

EXHIBITS ADMITTED INTO EVIDENCE: Administrative Notice taken of Agency Record; Complainants Leroy and Jill Wilkerson’s Exhibits C1, A1, A2, A3, A4, A5, A8, A9, A10, A12, A13, A23, A18, A10, A20, A21, A22

Respondent First Option Design Build, LLC’s Exhibits C, D, F, L

FINDINGS OF FACT

First Option Design Build, LLC (“Respondent”) is the holder of License Number 316047 issued by the Arizona Registrar of Contractors (“Registrar”). Paul Alan Zimmerman is Respondent’s Qualifying Party.

On or about August 2, 2024, Leroy Wilkerson and his wife, Jill Wilkerson (“Complainants”), contracted with Respondent for Respondent to “source and Install of Lovum Door” with a scope of work that included “Lovum Doors as per Attached Quote[;] Install Lovum Doors[;] Install Electric as Needed[;] Waterproof Opening[;] Install Door[;] Waterproof Door.” The contract specified: “NOTE: This is a Labor and Materials Contract except as noted.” The top left corner of the contract contains Respondent’s name and the top right corner and bottom left corner of the contract states, “Your Lovum Door Vendor.” Mr. Zimmerman’s business card also states that Respondent is a Lovum Door Dealer. On September 13, 2024, Complainants paid $20,000.00 via check made out to Lovum Doors, LLC. Mr. Zimmerman picked up the check from Complainants and deposited it into a Wells Fargo bank account for Lovum Doors, LLC.

On or about January 30, 2025, the Registrar received a Complaint against Respondent from Complainants alleging abandonment with respect to the project.

The Registrar assigned the Complaint to Investigator Charles Riddlehoover. After a March 6, 2025 Jobsite Inspection, Investigator Riddlehoover issued a Written Directive to Respondent dated March 6, 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 3/20/2025.

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

Complaint Item: 1 - Abandonment

Investigator’s Observation: During our inspection it appeared the sliding glass patio doors had not been installed. A temporary wall has been put in place to prevent animals from entering the home. Respondent shall correct by appropriate means.

After the March 20, 2025 deadline for compliance with the Written Directive, Investigator Riddlehoover ascertained that Respondent had not complied with the Written Directive. Thereafter, Investigator Riddlehoover forwarded the Complaint to the Registrar’s Legal Department. The Registrar issued a Citation against Respondent charging possible violations of A.R.S. § 32-1154(A)(1), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(a), A.R.S. § 32-1154(A)(12), specifically, A.R.S. § 32-1158, and A.R.S. § 32-1154(A)(22).

Respondent timely filed a written Answer to the Citation and the matter was referred to the Office of Administrative Hearing, an independent State agency, for an administrative hearing.

Investigator Riddlehoover testified consistently with the findings contained in the Written Directive. Investigator Riddlehoover testified that he issued a Warning Letter to Respondent due to the fact that Respondent’s contract document was missing certain statutorily required elements, specifically, the contract did not contain an estimated completion date and did not provide the property owner with the required information as to how to file a complaint with the Registrar.

Investigator Riddlehoover testified that Lovum Doors, LLC dissolved on January 24, 2025. Complainants provided payment to Respondent on September 13, 2024, in the amount of $20,000.00 as a deposit for the doors. Respondent accepted the payment and deposited the check. Investigator Riddlehoover testified that the doors should have been obtained in that four month timeframe. Investigator Riddlehoover asserted that Respondent, as the contractor for this project, purchased the materials from a manufacturer and should have been in “constant communication” with the manufacturer.

Complainants agreed with Investigator Riddlehoover’s testimony. Mr. Wilkerson testified at length regarding his dealings with Mr. Zimmerman and his reasonable and justifiable belief that he had contracted with Respondent for Respondent to provide the labor and materials for the door installation at his home. Mr. Wilkerson credibly testified that all communications were with Mr. Zimmerman. Complainants’ communication with Mr. Zimmerman included agreeing on the doors, the price, and scope of work, and Mr. Zimmerman picked up and deposited the check. Mr. Wilkerson credibly testified that Mr. Zimmerman never asked Complainants to sign the contract. Mr. Wilkerson signed off on the specifications for the doors after the deposit was paid. Complainants never had a contract with Lovum Doors, LLC. It was only after the instant Complaint was filed that Mr. Zimmerman informed Complainants that his status with Lovum Doors, LLC had morphed from a vendor to a salesperson. Respondent’s address also appeared on all Lovum Doors, LLC invoices.

Mr. Wilkerson testified that initially, the parties had discussed installing an awning as well, however, while Complainants were still deciding on whether to install an awning, Mr. Zimmerman told them they needed to order the doors and that they could order the awning later when the doors were being manufactured.

Mr. Wilkerson testified that Respondent did not perform any work on the project, the doors were never delivered, and the deposit was not refunded.

Michael Reese, a former Lovum Doors, LLC employee, testified on behalf of Respondent. Mr. Reese testified that Mr. Zimmerman had been a vendor for Lovum Doors, LLC until the beginning of July 2024, when he became a sales representative. Mr. Reese testified that commissions were not paid until doors were delivered.

Mr. Zimmerman testified that the document Respondent provided to Complainants was a “quote” or a “proforma invoice,” not a contract. Mr. Zimmerman testified that he did not have time to change his business cards and contract document to reflect his new status as a sales representative prior to his dealings with Complainants. Mr. Zimmerman asserted that Mr. Wilkerson “understood” that he was a sales representative, not a vendor for Lovum Doors, LLC. Mr. Zimmerman testified that he had “no idea” that Lovum Doors, LLC was going out of business, although he was aware that Lovum Doors, LLC was “having problems.”

Mr. Zimmerman acknowledged that he picked up the deposit check from Complainants and deposited it for Complainants. Mr. Zimmerman testified that he accepted Complainants’ payment as a “convenience.” Mr. Zimmerman testified that he “never got paid” and that the “relationship” was between Complainants and Lovum Doors, LLC. Mr. Zimmerman further argued that notwithstanding that his documents state that he would “source and install” the doors, “source” does not mean “purchase.”

Mr. Zimmerman argued that Respondent was not acting in the capacity of a contractor because Respondent was not paid anything, and therefore, Respondent was not compensated. Mr. Zimmerman asserted that Complainants had the time in which it would have taken to manufacture the doors, to essentially decide if they wanted Respondent to perform the installation or have a different contractor do so.

Administrative notice is taken of Respondent’s prior License record on June 19, 2025. Such prior License record reflects that Respondent’s License Number 316047 was first issued on September 29, 2017, and is active. Such prior License record also reflects that there is only the instant open Complaint, no resolved/settled complaints and no complaints resulting in discipline against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainants bear 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.”

A.R.S. § 32-1101(A)(3) defines "Contractor" as follows:

(a) Is synonymous with the term "builder" and means any person, firm, partnership, corporation, association or other organization, or a combination of any of them, that, for compensation, undertakes to or offers to undertake to, purports to have the capacity to undertake to, submits a bid or responds to a request for qualification or a request for proposals for construction services to, does himself or by or through others, or directly or indirectly supervises others to:

(i) Construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, railroad, excavation or other structure, project, development or improvement, or to do any part thereof, including the erection of scaffolding or any other structure or work in connection with the construction.

(ii) Connect such a structure or improvements to utility service lines and metering devices and the sewer line.

(iii) Provide mechanical or structural service for any such structure or improvements.

(b) Includes subcontractors, specialty contractors, floor covering contractors, hardscape contractors and consultants who represent that they are able to supervise or manage a construction project for the property owner's benefit, including hiring and firing specialty contractors, scheduling work on the project and selecting and purchasing construction material.

The Administrative Law Judge concludes, based on the credible and probative evidence of record, that Respondent acted in the capacity of a contractor in this matter. Respondent is a licensed contractor. Respondent provided a bid to Complainants for the sourcing and installation of doors. Complainants paid a deposit for the materials for the project. Mr. Zimmerman picked up and deposited the deposit check. Although Mr. Zimmerman argued that he did not actually receive compensation for this project, had Lovum Doors, LLC not gone out of business, not only would Respondent have earned a commission for the sale of the doors, but Respondent would have been compensated for the installation of the doors. Therefore, Respondent for compensation, undertook or offered to undertake, purported to have the capacity to undertake, and submitted a bid for this project.

The evidence established that Respondent abandoned its contract with Complainants without legal excuse. While the manufacturer of the product went out of business, Respondent, as a licensed contractor had the responsibility of procuring a like product and installing the product as contracted. Therefore, Complainants established that Respondent violated A.R.S. § 32-1154(A)(1).

The evidence established that by not honoring its contract with Complainants, Respondent did not complete the project in a professional and workmanlike manner. Therefore, Complainants established that Respondent violated A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A).

The evidence established that Respondent’s contract document failed to contain all of the statutorily required elements for written contracts. Therefore, Complainants 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 comply with the Written Directive. Further, Respondent failed to establish any affirmative defense to establish valid justification for such failure. Therefore, Complainants 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 316047 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 1, 2025.

/s/ Sondra J. Vanella

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

c/o Legal Department

First Option Design Build, LLC

[email redacted]

Leroy Wilkerson

[email redacted]

Charles Riddlehoover

[email redacted]

By: OAH Staff