ALJDEC - Licensing

2025A-03494-CHC-ROC · Registrar of Contractors · 2025-11-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Kathryn Kanipe,

COMPLAINANT

v.

MC General Contracting LLC

DBA: McCully Construction,

License No. ROC 323378,

RESPONDENT

No. 2025A-03494-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: November 12, 2025

APPEARANCES: Complainant Kathryn Kanipe was represented by Megan N. Schandle. Respondent MC General Contracting LLC was represented by William A. Kozub. Investigator Charles Riddlehoover appeared on behalf of the Arizona Registrar of Contractors.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

EXHIBITS ADMITTED INTO EVIDENCE: Complainant’s Exhibits 1-9 and Respondent’s Exhibits A-K, and the Agency file were all admitted into evidence.

_____________________________________________________________________

FINDINGS OF FACT

MC General Contracting LLC (Respondent) is the holder of License No. 323378 issued by the Arizona Registrar of Contractors (Registrar).

On or about June 29, 2022, Complainant hired Respondent to remodel her residence in Scottsdale, Arizona.

On or about April 4, 2025, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to project.

The Registrar assigned the complaint to Investigator Charles Riddlehoover. The jobsite inspection was performed on May 8, 2025.

Investigator Riddlehoover then issued a Written Directive on or about May 22, 2025, which provided in pertinent part 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 June 9th, 2025.

. . .

DIRECTIVE REQUIREMENTS

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

Complaint Item: 1 - Performed work without a permit (Installed windows, sliding doors, Electrical and Plumbing)

Investigator’s Observation: The Respondent will obtain a permit, correct any deficiencies required by the county/city, and pass final permit inspection.

Governing Rule: Violation of any rule adopted by the Registrar; Namely

A.A.C. R4-9-108(b): A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. For work to be performed in accordance with professional industry standards, a contractor shall use such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly icensed contractor possessing ordinary skill and capacity.

A.R.S. § 32-1154(A)(3) - R4-9-108(B) Building Codes/Prof. Industry Standards

Complaint Item: 3 - Floor is wavey and separating.

Investigator’s Observation: During our inspection it appeared the LVT flooring has begun to separate in several places throughout the flooring system. Respondent shall correct by the appropriate means.

Governing Rule: Violation of any rule adopted by the Registrar; Namely

A.A.C. R4-9-108(a): A contractor shall perform all work in a professional and workmanlike manner.

A.R.S. § 32-1154(A)(3) - R4-9-108(A) Workmanship

Complaint Item: 5 - Paint is not to workmanship standards.

Investigator’s Observation: During our inspection the Complainant demonstrated and it appeared not within minimum standards.

Interior: Sheen on the wall in boys room, sheen in hall, sheen on hall bath wall, sheen kitchen ceiling where it meets the wall, drywall tape, crack in

kitchen/hall ceiling, gaps at light switches open junction box on exterior master bedroom wall, and removal of ceiling fans in bedrooms leaving junction boxes in ceiling covered by drywall. Paint sheens were visibly different in normal sunlight.

Bubbles or "pocks" in skip trowel finish above light switches and around window frame in kitchen shall be repaired.

Exterior: Stucco crack above sliding door to exterior patio, exterior paint around master bedroom window color does not match, and bump out stucco cracks.

Respondent shall properly prepare and refinish affected areas, matching color as closely as possible. Where the finish affects the majority of the wall or area, the whole area should be refinished. Respondent shall correct by the appropriate means.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(a): A contractor shall perform all work in a professional and workmanlike manner.

A.R.S. § 32-1154(A)(3) - R4-9-108(A) Workmanship

Complaint Item: 6 - Windows installed cannot be opened.

Investigator’s Observation: During our inspection the Complainant demonstrated the following deficiencies that are not within the ROC minimum standards. The living room window does not slide freely, not properly sealed, gaps at exterior seals, Respondent shall correct by the appropriate means.

Stucco cracks shall become a maintenance item after repair.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(a): A contractor shall perform all work in a professional and workmanlike manner.

A.R.S. § 32-1154(A)(3) - R4-9-108(A) Workmanship

Complaint Item: 7 - Sliding doors are malfunctioning

Investigator’s Observation: During our inspection it appeared the living room sliding door may need adjustment in order to work as intended.

Respondent shall correct by appropriate means.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(a): A contractor shall perform all work in a professional and workmanlike manner.

A.R.S. § 32-1154(A)(3) - R4-9-108(A) Workmanship

Complaint Item: 9 - Gas line installed for new double oven, not permit or calculated for line size BTU

Investigator’s Observation: The Respondent will need to correct this issue by the appropriate means. Since the Respondent is not appropriately licensed to do this work, the appropriate means will be the two parties coming to a resolution to have an appropriately licensed contractor obtain permits and to construct or reconstruct as required by the building official.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(b): A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. For work to be performed in accordance with professional industry standards, a contractor shall use such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly licensed contractor possessing ordinary skill and capacity.

A.R.S. § 32-1154(A)(3) - R4-9-108(B) Building Codes/Prof. Industry Standards

. . .

On June 20, 2025, the Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A) and (B); and A.R.S. § 32-1154(A)(22).

On or about July 1, 2025, Respondent submitted an Answer to the Registrar.

On or about August 11, 2025, a Notice of Hearing was issued setting a hearing on September 22, 2025, at the Office of Administrative Hearings, an independent state agency.

After a continuance, the hearing was held on November 12, 2025.

At hearing, Investigator Riddlehoover testified as to the Registrar’s involvement and the above timeline and findings.

Investigator Riddlehoover testified further that he never received any notification that the permit had been issued and/or applied for by Respondent, and added that Respondent could have corrected the flooring, painting, and stucco/drywall cracks without the need for a permit.

Also, Investigator Riddlehoover testified that Respondent never informed him that Respondent was being obstructive in allowing access to the property.

Finally, Investigator Riddlehoover testified that he informed Complainant that the Directive could be extended or the matter could proceed through the legal process.

Benjamin Kanipe testified as to the items in the Written Directive which were ordered to be repaired.

Mr. Kanipe also testified about the parties emails from May 22, 2205 through June 11, 2025. Mr. Kanipe testified that he left the dates wide open for Respondent to perform the corrective work, but he also understood that Mr. McCully did not want to complete the work until the permit was obtained.

Nick McCully was Respondent’s President and Owner, and did not dispute the items contained in the Written Directive. Instead, Mr. McCully testified that as of the Jobsite Inspection on May 8, 2025, he was ready to perform any corrective work needed.

Mr. McCully testified too that once the Directive was issued on May 22, 2025, he sent an email to Complainant informing of next steps and that they would be on the property on May 29, 2025, to cut the drywall to inspect the area so the plans could be drawn up for the permit. Mr. McCully testified that the email also explained that once the permit was issued, then the remainder of the corrective work would begin, as this would be the most efficient order of operation to have the least invasion in Complainant’s property. Mr. McCully acknowledged however, that the flooring, painting and some outside stucco work could have been performed without the permit, it just did not makes sense to complete the same without obtaining the permit to finish the major door wall project first as those areas may have needed to be re-done once the door wall was repaired.

Further, Mr. McCully testified that Complainant never gave permission to come on May 29, 2025, and instead, sent several further emails with additional questions/concerns. Mr. McCully testified that it was not until June 2, 2025, that Mr. Kanipe finally granted access to perform the work, but it was not until June 10, 2025 when Adam Schwartz e-mailed Mr. Kanipe informing him that workers would arrive at 8:00 a.m. on June 12, 2025. Mr. McCully testified however, that on June 11, 2025, Mr. Kanipe informed Respondent to not come to the property.

Mr. McCully also testified that on June 10, 2025, he emailed Investigator Riddlehoover to inform him of the plan moving forward to address the issues.

Respondent’s employees Adam Schwartz and Steven Lugo also testified for Respondent that they were prepared to perform the corrective work and that Complainant denied access.

Administrative notice was taken of Respondent’s prior License record on November 26, 2025. Such prior License record reflected that Respondent’s License No. 323378 was first issued on January 29, 2019, and reflected that there was one open case, namely the present case.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); see also Vazzano v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960).

The preponderance of the evidence established, and Respondent conceded that there was a violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A), and A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(B).

Finally, there was also no dispute that the corrective work was not performed by Respondent. The tribunal carefully reviewed the email correspondence between the parties, and it was clear that Respondent attempted to set a date, May 29, 2025, to come and open the wall for an inspection to get the plans drawn up. It was also clear that Mr. Kanipe never consented to that date, nor ever offered a specific alternative date and time, which appeared that he was delaying the corrective work from proceeding. The tribunal also finds Mr. McCully’s thought process to complete the corrective work reasonable to avoid having to possibly come back to redo any touch up painting/stucco work and flooring, yet confusing as he certainly had no problem commencing the project without a permit. Finally, the tribunal believes that the Registrar also failed to protect both parties in this case. Given the situation, the tribunal believes that the Registrar could have been more involved in helping both sides come to a date, or at a minimum, at least extend the Directive due date to allow Respondent additional time to obtain the permit. Yet, the evidence demonstrated that Complainant chose to have the process move forward to hearing, which ultimately demonstrated to the tribunal that Complainant really did not want Respondent to complete the project.

Therefore, Complainant established that Respondent did not fail 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 dismiss the Complaint against Respondent’s License No. 323378.

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, November 26, 2025.

/s/ Adam D. Stone

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

Megan N. Schandle, Esq.

LANG THAL KING & HANSON PC

[email redacted]

William A. Kozub, Esq.

THE KOZUB LAW GROUP PLC

[email redacted]

By: OAH Staff