ALJDEC - Licensing

2025A-10363-CHC-ROC · Registrar of Contractors · 2026-04-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Carson Fanning,

COMPLAINANT,

v.

Schmidgall & Sons Drywall LLC

dba Schmidgall & Sons Drywall & Painting,

License No. ROC 335317,

RESPONDENT.

No. 2025A-10363-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 10, 2026

APPEARANCES: Carson Fanning appeared on his own behalf. David Schmidgall and Marji Schmidgall appeared representing Schmidgall & Sons Drywall LLC dba Schmidgall & Sons Drywall & Painting. Investigator Ruben Perez, Sr. appeared from the Registrar of Contractors.

ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn

EXHIBITS ADMITTED INTO EVIDENCE: ROC Notice of Hearing Packet (“Packet”); Respondent Exhibit s A through D. _____________________________________________________________________

FINDINGS OF FACT

Schmidgall & Sons Drywall LLC dba Schmidgall & Sons Drywall & Painting (“Respondent”) is the holder of License No. 335317, CR-34 Painting and Wall Covering, issued by the Arizona Registrar of Contractors (“Registrar” or “ROC”) in October 2021.

In April 2025, Carson Fanning (“Complainant”) contracted with Respondent for stucco removal and replacement and painting after some underlying repair work for the contracted price of $13,209.00. The work began on May 7, 2025 and stopped on June 30, 2025.

On October 23, 2025, the Registrar received a Licensed Complaint Form (“Complaint”) against Respondent from Complainant. The Complaint alleged poor work, incomplete work, and abandonment.

The Registrar assigned the Complaint to Investigator Ruben Perez, Sr., (“Investigator”), who scheduled a jobsite inspection for November 20, 2025.

Both Complainant and Respondent were present at the jobsite inspection. Investigator reviewed the Complainant with the parties and took multiple photographs to document the alleged workmanship issues and resulting conditions of the project.

After review of the parties’ contract, Investigator issued a Warning Letter on November 24, 2025, to Respondent for alleged violation of Arizona Revised Statutes (“Ariz. Rev. Stat.”) § 32-1154(A)(12), specifically Ariz. Rev. Stat § 32-1158 for Respondent’s failure to include all nine required minimum elements in its written contracts, including its contract with Complainant.

On November 26, 2025, Investigator issued a Written Directive to Respondent, which 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, December 12, 2025.

RESTRICTIONS

• You may not perform or hire other contractors to perform work that is outside the scope of your license.

• If your license is currently suspended for administrative reasons, or is inactive, expired, or cancelled, you may not perform any corrective work nor contract in any manner, which includes hiring other contractors to perform work, until the suspension of your license(s) has been lifted or your license(s) has been reactivated.

DIRECTIVE REQUIREMENTS

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

Complaint Item 1: None of the dry rotten fascia board was replaced was not replaced per estimate.

Investigator’s Observation: Written contract notes, “Provide labor and material to replace approximately 10’ feet of dry rotted fascia boards”. Both parties reported fascia board was not replaced at all. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

Complaint Item 3: Did not sand T1-11 to prep for painting per estimate. Instead, they said they sprayed with a type of non-peal material.

Investigator’s Observation: Written contract notes, “Sand T1-11 panels on studio to prep for painting. Power wash, prep, caulk where needed, and apply Sherwin Williams A100 exterior latex paint or comparable to all exterior walls of main house and studio.” House and apartment were observed with exterior paint peeling and deteriorating in multiple locations. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

“Contractor should properly prepare and refinish affected areas, matching color as closely as possible. Where finish deterioration affects the majority of the wall or area, the whole area should be refinished.”

Complaint Item 4: Wood over hangs were not prepared before painting rustling in new paint separating/peeling.

Investigator’s Observation: Written contract notes, “Sand T1-11 panels on studio to prep for painting. Power wash, prep, caulk where needed, and apply Sherwin Williams A100 exterior latex paint or comparable to all exterior walls of main house and studio.” House overhang and apartment overhang were observed with exterior paint peeling and deteriorating in multiple locations. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

“Contractor should properly prepare and refinish affected areas, matching color as closely as possible. Where finish deterioration affects the majority of the wall or area, the whole area should be refinished.”

Complaint Item 5: The stucco on the house was not done pre the estimate. Estimate was for 2’ around the bottom of the house.

Investigator’s Observation: Written contract notes, “Provide labor and material to demo stucco approximately 2’ up from bottom of perimeter of main house, install new weep screed around area where stucco was removed, install new black paper, attach new lathing wire, and apply a three part stucco system (scratch, brown, texture to match existing texture).” Both parties reported stucco work was only done on East part of the house. House stucco was observed with bottom (approx. 2’) of walls repaired on East part of the residence. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

Complaint Item 6: Areas of studio and house are not covered with new paint.

Investigator’s Observation: Both parties reported some small areas of house and apartment are missing paint. Respondent added “touch ups” are still to be done. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

Complaint Item 7: Broke a front light fixture when removing for paint and never installed the replacement fixture I had to purchase.

Investigator’s Observation: Both parties reported light fixture was damage when it was removed and on ground. Respondent added they did not properly secured light fixture on ground. Respondent to correct by appropriate means.

Governing Rule: ARS 32-1154(A) (3) specifically to Rule 4-9-108

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item 2: Cracks in dry rotten facia board were filled with Liquid Nail and covered with paint.

Investigator’s Observation: Cracks in fascia boards were observed filled with caulking like material. This is within industry standards.

Governing Rule: Not Applicable

Complaint Item 8: One of the back light fixtures they removed and reinstalled is not working.

Investigator’s Observation: Complainant asked to disregard this item.

Governing Rule: Not Applicable

Complaint Item 9: Weep screed not installed. I had to find someone to have a sidewalk pored.

Investigator’s Observation: Complainant asked to disregard this item.

Governing Rule: Not Applicable

On December 29, 2025, the Registrar issued a Citation against Respondent charging possible violations of the applicable statutes:

Charge :1 A.R.S. § 32-1154(A)(3) - R4-9-108(A) 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.

Charge :2 A.R.S. § 32-1154(A)(12) – A.R.S. § 32-1158

Failure in any material respect to comply with this chapter; Namely A.R.S. § 32-1158.

Charge :3 A.R.S. § 32-1154(A)(22) Failure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the Registrar.

The matter was not resolved informally between the parties.

At hearing, Investigator testified regarding the background of the Complaint, his findings, and the determinations set forth in the Written Directive. Investigator indicated that, at the jobsite inspection, Respondent had indicated that the wood Complainant wanted to be painted was not in any condition to be repaired or painted.

At hearing, Investigator posited that, as results of construction work, a contractor accepts the surface when they perform work thereon and, thus, are responsible for the result. Investigator confirmed that, at the time of the jobsite inspection, some areas of the existing T1-11 were delaminating/delaminated and, further, that he was unable to determine whether it had been sanded prior to being painted by Respondent.

At hearing, Complainant acknowledged that the T1-11 was in poor condition at the time of the contract and that was why he had hired a professional painter. Complainant argued that no sanding of the T1-11 was done and that, if Respondent had sanded the T1-11, the paint would not now be sticky or peeling.

At hearing, Respondent did not disagree with the Directive items but explained several of the items and the work thereon.

Respondent testified that the failing of the work on the T1-11 was unforeseeable and the T1-11 had needed to be replaced; replacement of the T1-11 was not a part of the parties’ contract. Respondent indicated that, when they started to sand the T1-11, the layers kept coming off and that was why they had utilized the Peel Stop to try to seal the T1-11. Respondent further indicated that all the paint does not need to be sanded off and, usually, they would just prime and paint. Finally, Respondent noted that once T1-11 fails, it simply won’t absorb the paint.

Regarding the stucco, Respondent indicated that the contract called for approximately 2 feet up from the bottom of the house and they had gone approximately 3 feet up on the repairs from the water damage. Due to that past water damage, Respondent had recommended that concrete be poured rather than have weep screed at the bottom of the wall.

Based on the various issues which arose at the project, Respondent had tried to settle the matter with Complainant when the project was not yet completed [and prior to the Complaint being filed] offering credits on the contract both against other needed work and accommodating the work performed to that time.

Since the time of the hearing, Complainant has not advised the Tribunal that the parties have resolved the matter.

Administrative notice is taken of the Registrar’s public records and Respondent’s ROC License record on March 31, 2026. The public record indicates that Respondent has only this one open case with the Registrar.

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 purpose of the Registrar’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).

Construction is not a perfect art and, normally, contractors must be allowed an opportunity to correct poor workmanship before their licenses may be suspended or revoked as a result of a failure to comply with workmanship standards.

The Directives mandated correction of the Investigator-determined workmanship issues. An appropriate period of time was given for the corrections and there is no evidence that Respondent requested an extension of the time period. The hearing record demonstrates that Respondent did not perform, or have any corrective work done, to complete the Directive items.

The hearing record did not evidence that, as had been directed, Respondent developed, and provided to the ROC, a written contract form that would comply with the statutory requirements. Therefore, the hearing record demonstrated that Respondent was in violation Ariz. Rev. Stat. § 32-1154(A)(12), specifically Ariz. Rev. Stat. § 32-1158.

The evidence established that Respondent’s construction work on this project 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 failed to complete the directed corrective work during the period of the Written Directive. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a Written Directive from the Registrar, without valid justification, in violation of Ariz. Rev. Stat. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing,

It is recommended that Respondent’s ROC License 335317 be suspended for two (2) business days beginning on the effective day of the Registrar’s final Order in this matter.

It is recommended that the Registrar require Respondent to submit a new written contract form that includes all nine required minimum elements pursuant to Ariz. Rev. Stat § 32-1158.

It is further recommended that, on or before thirty (30) days after the effective date of the final order, Respondent shall provide a sample written contract to the Registrar to demonstrate that Respondent has amended its written contracts to include all nine terms required by Ariz. Rev. Stat. § 32-1158(A). If Respondent fails to establish to the Registrar that it has brought its written contracts into compliance with Ariz. Rev. Stat. § 32-1158(A) within thirty days, Respondent’s ROC License 356602 shall be suspended until Respondent demonstrates that it has done so.

It is recommended that the Registrar require Respondent to pay the sum of $200.00 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 (30) days following the effective date of the Registrar’s final order, the Registrar revoke Respondent’s ROC License 335317, 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)(7), unless Respondent tenders payment of any outstanding prior civil penalty.

Pursuant to Ariz. Rev. Stat. § 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 Administrative Law Judge Decision. If the licensee accepts the Administrative Law Judge Decision, the Administrative Law Judge 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, April 2, 2026.

/s/ Kay A. Abramsohn

Administrative Law Judge

Transmitted electronically to:

Tom Cole

Registrar of Contractors

Carson Fanning

[email redacted]

Schmidgall & Sons Drywall LLC dba Schmidgall & Sons Drywall & Painting

[email redacted]

Ruben Perez Sr.

[email redacted]

By: OAH Staff