ALJDEC

99F-189-ROC · Registrar of Contractors · 1999-05-04

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 4, 1999 at 9:00 a.m. APPEARANCES: Plaintiffs appeared on their own behalf; Defendant appeared on his own behalf. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

The sole issue in this administrative proceeding is the amount Plaintiffs should recover from the Registrar of Contractors’ Residential Contractors’ Recovery Fund under A.R.S. § 32-32-1151 et seq. The parties presented evidence and testimony and, based upon the entire record, the undersigned makes the following Findings of Fact, Conclusions of Law and Recommended Order. FINDINGS OF FACT Procedural Background The Registrar of Contractors issued License No. 055201, Class C-03, to Defendant, an individual, on September 10, 1981. On or about October 6, 1996, Defendant contracted with Plaintiffs to construct a garage, deck, awning, and steps at their home at a cost to Plaintiffs of $25,000. Defendant substantially completed the job in January 1997 and, on or about May 8, 1997, Plaintiffs made a complaint to the Registrar alleging seven specific deficiencies in Defendant’s workmanship. The Registrar designated this complaint Case No. A98-0148. The Registrar’s inspector Charles A. Thomas performed a jobsite inspection and, on behalf of the Registrar, on December 3, 1997 directed Defendant to correct six items. Defendant did not comply with the Registrar’s directive and, on February 2, 1998, the Registrar issued the Citation and Complaint in Case No. A98-0148 to Defendant, charging violations of A.R.S. § 32-1154(A)(3), (7), (17), and (23). Case No. A98-0148 was referred to the Office of Administrative Hearings pursuant to A.R.S. § 41-1092.02 and heard by Administrative Law Judge Casey J. Newcomb. On June 16, 1998, the Registrar accepted Judge Newcomb’s recommended decision revoking Defendant’s license because his contractual undertakings were mostly beyond the scope of his C-03 license, his contract performance was unprofessional and unworkmanlike, and he failed several times to comply with the Registrar’s directive to retain an appropriately licensed contractor to perform the corrective work, all of which resulted in substantial injury to Plaintiffs. The Registrar’s decision in Case No. A98-0148 became final and as a result, on July 24, 1998, the Registrar revoked Defendant’s license. On or about September 25, 1998, Plaintiffs made a claim to the Residential Contractors’ Recovery Fund (“Recovery Fund”), claiming the cost of correction for four items: g) Awning on both sides of house leaking; h) Garage doors need adjusting; i) Deck’s floor needs replacement; and j) Steps need replacement. These four items corresponded to Inspector Thomas’ December 3, 1997 directive to Defendant to “reflash between the home and awnings to correct leaking problem”; to “rebuild steps at entry to the decks”; to “adjust garage door assemblies to properly fit within jams”; and to “replace plywood in decks and properly reseal.” Decision at 2. By the time of the hearing in Case No. A98-0148, Defendant had installed proper backing plates behind the hand locks on the overhead garage doors. The sixth item in Inspector Thomas’ directive, repainting the garage doors, apparently was subsumed in garage door adjustment. Attached to Plaintiffs’ claim to the Recovery Fund were three proposals from Marjanen Builders, Class B License Nos. 106299, 106315, and 113658, Hurley Brothers Builders, Class B License No. 120814, and Frontier Contracting, Inc., Class B License No. 125087. For a total cost of $8,150.00, among other repairs, Marjanen Builders proposed to “install ½” CCX plywood on front and back decks over existing [decks].” For a total cost of $11,675, among other repairs, Hurley Brothers Builders proposed to “[a]dd treated ½” plywood on existing deck.” For a total cost of $8,985.00, among other repairs, Frontier Contracting, Inc. proposed to perform “installation of new deck covering materials.” On November 18, 1998, Inspector Thomas recommended that the claim be resolved with a pay-out from the Recovery Fund in the amount of Marjanen’s bid, the lowest of the three submitted. On December 2, 1998, the Registrar Issued a Notice to Contractor of Claim for Administrative Payout, which notified Defendant that Plaintiffs had submitted a claim to the Recovery Fund payable in the amount of $8,150.00 and that an award may have been made without a hearing unless Defendant requested a hearing in writing. Although on December 31, 1998 the Registrar ordered the Recovery Fund to pay Plaintiffs $8,150.00, the Registrar subsequently granted Defendant’s request for a rehearing. Evidence Presented and Attempted to be Presented at Hearing Approximately 45 minutes before the time set for the hearing to begin, Defendant made a telephone call to the Office of Administrative Hearings to inform it that the distributor cap on his vehicle had malfunctioned and that he was in the process of replacing it. He identified his location as being about 1-½ hours away from Phoenix. The beginning of the hearing was therefore delayed to allow Defendant additional time to travel. At the hearing, the administrative law judge took administrative notice of the Registrar’s order in Case No. A98-0148. Plaintiffs presented the three bids that they had attached to their claim to the Recovery Fund. The administrative law judge explained that, because the Registrar’s decision in Case No. A98-0148 had become final and conclusively established that Defendant had committed the charged statutory violations in his performance of the contract with Plaintiffs, the only issue raised by their claim to the Recovery Fund was the extent of their damages. Defendant attempted to testify that the repairs that the three contractors proposed to make were unnecessarily extensive because not all the plywood needed to be replaced on the deck. Defendant testified that, during the more than seven months that had elapsed since Plaintiffs had made their claim to the Recovery Fund, he had called Plaintiffs once and left a message to arrange a time for himself and a licensed contractor of his choice to examine the deck but they had not called him back. Plaintiffs denied having received any such message. In addition, Defendant testified that he could not go onto the property to inspect the deck on the advice of his lawyer and therefore could not show an appropriately licensed contractor what needed to be repaired. CONCLUSIONS OF LAW In this administrative proceeding, Plaintiffs bear the burden of proof and must establish the amount of their damages by a preponderance of the evidence. See A.A.C. R2-19-119; see also Culpepper v. State, 187 Ariz. 431, 438, 930 P.2d 508, 515 (App. 1996). “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). A preponderance of the evidence is “evidence which is of greater weight or more convincing than evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary at page 1064 (6th ed. 1990). The Registrar’s final order in Case No. A98-1410 resulted in a conclusive determination that Defendant had violated A.R.S. § 32-1154(A)(7),[1] (23),[2] (3),[3] and (17),[4] which determination required the Registrar to revoke its license. This is because, In Arizona, “‘[p]ublic policy dictates that there be an end to litigation; that those who have contested the issue shall be bound by the result of the contest; and that matters once tried shall be considered forever settled as between the parties.’” Lofts v. Superior Court, 140 Ariz. 407, 410, 682 P.2d 412, 415 (1984) (quoting Baldwin v. Iowa State Traveling Men’s Ass’n., 283 U.S. 522, 525, S. Ct. 517, 518, 75 L. Ed. 1244 (1931)). The evidence Plaintiffs submitted at the hearing establishes that Defendant’s violations of A.R.S. § 32-1154(A)(3), (7), (17) and (23) damaged Plaintiffs in the amount of $8,150.00. Since the deck was beyond the scope of Defendant’s license, he has always lacked and still lacks competence or qualifications to perform the contract or to render an opinion on how the deck should be repaired. Defendant no longer possesses even a C-03 license, which only had qualified him to construct and install awnings and canopies, not to construct decks, because, among other things, he contracted beyond the scope of that license. Defendant’s continued insistence on a right to render an opinion on or approve the scope of repairs raises no triable issue of fact. RECOMMENDED ORDER In view of the foregoing, it is recommended that the Registrar of Contractors order the Residential Contractors’ Recovery Fund to pay $8,150.00 to Plaintiffs. Done this day, May 5, 1999.

______________________________________ Diane Mihalsky Administrative Law Judge

Original transmitted by mail this ____ day of May, 1999, to:

Registrar of Contractors Mr. Michael P. Goldwater ATTN: Joyce Armijo 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________

----------------------- [1] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[t]he doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured.”

[2] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[f]ailure 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 written directive from the registrar.”

[3] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[v]iolation of any rule adopted by the registrar.” The rule violated here was A.A.C. R4-9-108, which requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.”

[4] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.”

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826