ALJDEC - Licensing

2025A-09878-CHC-ROC · Registrar of Contractors · 2026-05-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Anthony Pappas,

COMPLAINANT

v.

Escala Construction LLC,

License No. ROC 334555,

RESPONDENT

No. 2025A-09878-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 4, 2026

APPEARANCES: Complainant Anthony Pappas on behalf of himself. Investigator Lisa Melton on behalf of the Registrar of Contractors. No one appeared on behalf of Respondent Escala Construction LLC.

ADMINISTRATIVE LAW JUDGE: Fahd Nazir

EXHIBITS ADMITTED INTO EVIDENCE: Administrative notice was taken of the hearing packet.

FINDINGS OF FACT

Escala Construction LLC (Respondent) is the holder of License No. 334555 issued by the Arizona Registrar of Contractors (Registrar).

On or about August 7, 2025, Anthony Pappas (Complainant) entered into a contract with Respondent for, among other things, drain installation.

On or about September 26, 2025, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to the project.

The Registrar assigned the Complaint to Investigator Lisa Melton. After a jobsite inspection on December 19, 2025, at which Respondent was present through its representative, Investigator Melton issued a Written Directive (Directive) to Respondent 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 January 16, 2026. . . .

DIRECTIVE REQUIREMENTS

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

Complaint Item: Improper grading caused drainage issues, flooding at

pavers/pergola, and a failed drain, damaging structure/landscape

Investigator’s Observation: Complainant and Respondent (Victor Garrison) appeared for the inspection. Respondent has installed unattached pergola and paver pad along with paver walk to back patio. Drain was provided by change order. At this time water does not pond on the paver pad, however, water does flow to the patio and the installed drain flooded and failed to retain the runoff within a few minutes of

exposing the adjacent area to water flow. Respondent accepted the jobsite and substrate when they performed their work. Workmanship Standards require proper drainage of site away from the structure. Water is currently running into the back patio. Respondent should correct the drainage concern relative to the work they performed by appropriate methods. Complainant also alleges damage at post and landscaping but I cannot determine the condition of the post at the time of the start of Respondent’s work and the Registrar has no authority relative

to vegetation.

Following the issuance of the Directive, Respondent took no steps to correct the drainage issues. After the deadline in the Directive expired on January 16, 2025, Investigator Melton forwarded the matter to the Registrar’s Legal Department.

The Registrar issued a Citation against Respondent on January 29, 2026, charging possible violations of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A); and Ariz. Rev. Stat. § 32-1154(A)(22).

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

The Registrar issued a Notice of Hearing, setting a hearing at 9:00 a.m. on April 1, 2026. The Registrar mailed copies of the Notice of Hearing to Respondent at its address and email address of record.

A March 23, 2026, Order Granting Continuance reset the hearing for 1:00 p.m. on May 4, 2026, and advised the parties of how to connect to the hearing via Google Meet. The hearing was held via Google Meet on May 4, 2026.

Respondent did not request that the hearing be continued. Although the start of the hearing was delayed 15 minutes, Respondent did not appear through an authorized member, employee, or attorney. Consequently, Respondent did not present any evidence to defend its license.

Investigator Melton testified that improper grading caused drainage issues.

Complainant agreed with Investigator Melton’s testimony. Complainant also contended that he attempted to resolve the issue, however, Respondent told him that the work was beyond its expertise and they would have to charge more for the repairs.

Administrative notice is taken of Respondent’s prior License record on May 4, 2026. Such prior License record reflects that Respondent’s License No. 334555 was first issued on August 23, 2021, and is active. Such prior License record also reflects that there is one open complaint and one prior complaint resulting in discipline against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

The copies of the Notice of Hearing that the Registrar mailed to Respondent at its address and email address of record were reasonable and Respondent is deemed to have received notice of the hearing.

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 evidence 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 workmanlike manner in violation of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A).

The evidence established that Respondent did not attempt to complete the corrective work following the Directive being issued. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of Ariz. Rev. Stat. § 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 No. 334555 for a period of three days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 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 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 Ariz. Rev. Stat. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty.

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, May 18, 2026.

/s/ Fahd Nazir

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

Lisa Melton

[email redacted]

Escala Construction LLC

[email redacted]

Anthony Pappas

[email redacted]

By: OAH Staff