ALJDEC decisions subject to certification as final

21F-P21-076-BTR · Board of Technical Registration · 2022-02-15

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

James D. Smith, Non-Registrant,

and

James D. Smith Architects, Unregistered Firm,

Respondents.

No. 21F-P21-076-BTR

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 26, 2022

APPEARANCES: Brett Shaw, Esq., represented James D. Smith and James D. Smith Architects, Respondents. Assistant Attorney General Deanie Reh represented the Arizona Board of Technical Registration.

ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn

_____________________________________________________________________

FINDINGS OF FACT

James D. Smith (“Respondent”) previously held Arizona Architect Registration No. 64477. That Registration expired on October 31, 2020, because Mr. Smith failed to renew his registration.

Respondent is a sole proprietor who operates his practice out of Massachusetts under a firm name, James D. Smith Architects.

James D. Smith Architects (“Firm”) never held an Arizona Registration.

In 2021, Respondent began the process to re-register in Arizona. On June 2, 2021, Respondent emailed the Board regarding licensure paperwork. He indicated that he might have some potential projects and wanted to take care of the licensure quickly.

On June 2, 2021, the Board staff person responded that Respondent’s Registration had been cancelled and he would need to reapply.

On June 15, 2021, prior to being reregistered, Respondent reached out to an architect acquaintance regarding future possible work for Arizona locations.

On June 14, 2021, Arizona architect Doug Parlin forwarded to Arizona Architect Ed Marley, a Board staff/member, an e-mail that Mr. Parlin had received, unsolicited, from Respondent, in which Respondent and Firm were offering architectural services in Arizona.

The unsolicited email, dated June 14, 2021, claimed that Respondent has been registered as an architect in Arizona for over twenty years and had a project manager living in Phoenix who could cover site visits in Arizona.

The Board’s staff/investigator reviewed the matter and found that Respondent’s website identified Phoenix, Arizona as one of the locations in which the Firm had an office.

On July 2, 2021, prior to hearing from the Board, Respondent notified his assistants that no one from his firm should be marketing in Arizona and that no one should send any emails into Arizona. Respondent further notified his assistants that he needed to renew the Arizona registration and had not realized that it had lapsed.

Once notified regarding the complaint and investigation, Respondent provided his response to the Board on July 16, 2021 noting the following:

I have an ongoing marketing effort in which I have five people doing marketing for me all over the country. One of my people ACCIDENTALLY began sending out emails to Contractors in AZ and when I realized it I stopped them immediately. I can prove that it was unintentional AND that I also more importantly, have NOT PRACTICED in AZ for years and certainly not after my license expired. The first email I offer as evidence is below, wherein you can see on June 2, 2021 I approached [Board staff] to find out what needed to be done to become reinstated. ...

In another responsive email on July 16, 2021, Respondent noted, in pertinent part:

And again, the few emails that went out to GC’s by accident were immediately stopped when I realized they had been sent out so I never had any intent to practice OR to do marketing in AZ while not registered.

The matter was not resolved informally between the parties and the Board noticed the matter for administrative hearing at the Arizona Office of Administrative Hearings.

At hearing, Respondent testified credibly regarding his practice and his plan to become registered in more states to build his practice into a national practice. Respondent’s marketing is an in-house process with family members doing research for the Firm and, specifically, with his daughter sending out the marketing offers. Respondent indicated that his overall plans to expand were discussed but that he never told his daughter to send out any marketing in Arizona.

Respondent testified that he maintained a spreadsheet of his registrations which he had not updated with sufficient information; that spreadsheet indicated state-registrations but did not indicate the current status of the various registrations. However, Respondent has associations with persons in all states who, among them, are registered in various states.

At hearing, Respondent’s daughter, Chelsea Smith, testified credibly that she, herself, had prepared the template email and had sent out the email to Arizona contractors, not knowing at that time that the spreadsheet was not completely accurate with regard to “current” registration status. Ms. Smith testified that Respondent had not directed her to send out any marketing to Arizona and, when she told him she had started to send them out, he immediately told her to stop because he was not current on the Arizona license/registration.

At hearing, Respondent specified that he had not continued to proceed with a re-registration for Arizona because he thought it would be denied simply due to this investigation and he wanted to clear this up to have a clean record. As to any possible discipline in regard to the unintentional offer, Respondent requested that the criteria in A.R.S. § 32-106.02 be considered because he had no history of violations, had not benefited economically from the alleged violation, and, overall, his firm had simply honestly mistakenly sent out the email and immediately stopped that marketing.

At hearing, the Board indicated that this investigation would not have put an automatic stop to Respondent’s re-registration. As to a severity of discipline, the Board indicated that only a current registrant is entitled to a letter of concern and that, in this case and under these circumstances, the Board’s authority permits imposition of a civil penalty and the cost of the Board’s investigation.

The Board argued that, in this case, the evidence demonstrated the violations of Respondent and Firm offering to practice in Arizona without being properly registered in Arizona and that Respondent holds the liability for statutory violations. The Board argued that, in allowing his daughter to take the blame for mistakenly sending out the email to some Arizona contractors, Respondent failed to take responsibility for the violation.

CONCLUSIONS OF LAW

The Board is the duly constituted authority for the regulation and control of the practice of architecture, including the unregistered practice or offer to practice pursuant to A.R.S. § 32-101 et seq.

Pursuant to A.R.S. § 32-106.02(A), the Board may initiate an administrative hearing on receipt of a complaint that any person, who is not exempt from regulation and who is not registered/certified, is practicing or offering to practice a Board-regulated profession.

Pursuant to A.R.S. § 32-106.02(B), following an administrative hearing, if the Board determines that the person committed a violation under A.R.S. § 32-145, the Board is empowered to impose a civil penalty up to $2,000.00 per violation. However, pursuant to A.R.S. § 32-106.02(C), in determining the civil penalty, the Board is required to consider the violator’s history of any violations, the seriousness of the violations, and the economic benefit obtained by the violations.

The evidence presented at hearing established by a preponderance of the evidence that Respondent through his Firm “offered” to practice, but did not practice, the Board-regulated profession of architecture in the absence of current registration with the Board in violation of A.R.S. §§ 32-121, 32-145(1), and 32-141(C). The hearing evidence also established that the “offer” was honestly mistakenly made.

Neither Respondent nor Firm is exempt from the Board’s registration requirements. However, the Board’s position at hearing was that it could not discipline Respondent with a letter of concern pursuant to A.R.S. § 32-128(B) because Respondent was not a registrant. Therefore, the Administrative Law Judge concludes that, because neither Respondent nor Firm are registered, the Board has fewer options in such matters.

Considering the arguments of the parties, the Administrative Law Judge concludes that the action taken by Respondent through his Firm constitutes grounds for a civil penalty pursuant to A.R.S. § 32-106.02(B) and (C). While the Board is statutorily authorized to impose a civil penalty of no more than $2,000.00 per violation, A.R.S. § 32-106.02(C) requires that consideration be given to the absence of any evidence of any prior violation by Respondent during his two prior registration periods, the lack of any economic benefit obtained by Respondent as a result of the mistaken emails into Arizona, and the credible evidence that the mistaken marketing stopped as soon as Respondent found out about it. The Administrative Law Judge concludes that it is appropriate for a civil penalty to be imposed in the amount of $500.00 and in an amount to cover the Board’s investigative and administrative hearing costs in this matter.

RECOMMENDED ORDER

IT IS ORDERED the Board requires Respondent to pay the sum of $500.00 and the Board’s investigative and administrative hearing costs in this matter as a civil penalty pursuant to A.R.S. § 32-106.02(B) and (C).

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 five days from the date of that certification.

Done this day, February 15, 2022

/s/ Kay A. Abramsohn

Administrative Law Judge

Transmitted electronically to:

Judith Stapley, Executive Director

Board of Technical Registration-54864001

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