ALJDEC

99F-1921-ROC · Registrar of Contractors · 1999-06-22

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 22, 1999.

APPEARANCES: Complainant, Falk Kramer, appeared in his own behalf.

Respondent, Lee’s Tiles, Marble and Floorcovering, appeared through its owner and qualifying party, Ricky Lee Garner.

ADMINISTRATIVE LAW JUDGE: Robert. I. Worth ________________________________________________________________

Evidence and testimony were presented, and based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made.

FINDINGS OF FACT

1. Respondent was and is the holder of a Residential Class C-48 license issued by the Registrar of Contractors. The licensed entity is a sole proprietorship owned and operated by Ricky Lee Garner, who also serves as its qualifying party.

2. Respondent’s contracting license has been suspended by operation of law since May 31, 1999 for non-renewal. However, such suspension does not prevent the conducting of these administrative disciplinary proceedings, which are expressly authorized pursuant to the provisions of A.R.S. §32-1154(C).

3. It was not effectively disputed that the Complainant, Falk Kramer, did not at any time, and still does not, possess a contractor’s license of any type.

4. The testimony indicated that Respondent had run a newspaper advertisement that specifically sought the services of experienced tile- setters or installers, and that Complainant responded to such advertisement by calling Respondent’s owner and thereafter meeting him at a jobsite.

5. The testimony of the parties was sharply conflicting with respect to the contents of conversations as well as to the details of their concluded arrangements for work and payment. No valid basis is found to exist for the disbelief of either parties’ version.

6. It did appear that at the initial meeting, Complainant presented a business card utilizing a company name. The evidence was inconclusive as to whether or not any social security number was given or whether any disclosure of Complainant’s unlicensed status was made. In any event, the contemplated arrangements encompassed the installation of tile on two separate residential projects on which Respondent was serving as the selected specialty tile subcontractor. Complainant was to perform all tile installation labor, using his own tools, with all materials being furnished by Respondent.

7. The first of the two projects was part of the construction of a new home. Both projects necessitated the obtaining of a building permit, and each project also involved values of work plus materials of considerably more than $750.

8. Complainant commenced tile installation work on the first of the two residential projects. At the end of the first week, Complainant presented a total billing of $828.77 to Respondent for his installation labor in laying flagstone and ceramic tile, utilizing unit pricing, respectively, of $3.00 and $1.35 per square foot, such amounts having been mutually agreed upon after the Complainant’s initially proposed unit pricing had been rejected by Respondent.

9. The first week’s billing also included a separate amount for tearing out previously installed flagstone in preparation for the contemplated installation of new flagstone. This work was computed on an hourly rate of $25.00, although there appeared to be no meeting of the minds as to any rate higher than $20.00 per hour. Moreover, Respondent disputed the reported total time of 16 hours being so billed and also objected to the undertaking of the demolition work by Complainant without advance specific authorization from Respondent, despite some indication that a representative of the project’s general contractor had given such authorization.

10. No portion of the $828.77 billing by Complainant for the first week of work was paid by Respondent despite repeated requests and demands. Meanwhile, at the start of the following week, Complainant had started to perform further work on a second residential jobsite, consisting of the installation or setting of travertine and some marble materials.

11. A billing to Respondent applicable to the second jobsite work in the total amount of $719.00 was presented by Complainant by way of Facsimile (“Fax”)

transmission before the grouting portion had been accomplished. Once again, a unit price for most of the work in the amount of $3.00 per square foot was utilized which was the mutually agreed lowered amount after a rejected higher quotation, and also as agreed, a slightly higher unit pricing of $4.00 per square foot was used for a relatively small portion of the project so as to reflect the cost of added work that required installation on an angle.

12. The parties’ inability to agree on the amount of money payable for the first week of work resulted in a series of arguments which, in turn, led to the decision by Complainant to terminate his work efforts on the second jobsite. No portion of the second billing from Complainant was paid by Respondent, leading to the filing of the instant complaint with the Registrar of Contractors.

13. It is found and determined that the overall arrangements between these parties were wholly inconsistent with that of any employer-employee relationship. The initial presentation by Complainant of a business card, his quotation and subsequent adjustment of unit prices per square foot, the furnishing of his own tools and the actual jobsite work performances are more indicative of an independent contractor status. Some of these elements, standing alone, may not necessarily have been fatal to a determination of an employment relationship. However, when considered in combination, it must be held that Complainant has not sustained his burden of proving that he was an employee of Respondent on either of the two projects involved in this case.

14. The testimony at the hearing revealed that, following a separate complaint to the Registrar by Respondent, a Cease and Desist Order was issued to Complainant based upon his use of a business card without disclosing his unlicensed status.

Credible testimony by Complainant tended to demonstrate that he no longer uses these cards and is currently seeking to become properly licensed in his specialty trade.

14. Notwithstanding the lack of appropriate standing on the part of Complainant to pursue administrative or judicial remedies seeking collection of monies, nothing in this decision is intended to condone the actions of Respondent in the formulation of perhaps misleading wording in its newspaper advertising for skilled workers or for its failure to prudently and effectively verify the license status of any individual worker utilized on construction projects who is not an employee.

CONCLUSIONS OF LAW

1. The provisions of A.R.S. §32-1153 expressly prohibit the commencing or maintaining of an action for collection of compensation for acts requiring a license without proof that the person claiming entitlement to such compensation was duly licensed at the time of the contract arrangements and at the time of any alleged breach.

2. The evidence of record established that Complainant had impermissibly bid and performed construction-related work on several projects as an unlicensed independent contractor and therefore lacks proper standing to pursue a complaint filed with the very administrative agency charged with enforcement of the State’s licensing laws.

3. The record fails to support any violation by Respondent of the provisions of A.R.S. §32-1154(A) as charged in the Citation issued hereunder.

RECOMMENDED ORDER

In view of the foregoing, it is recommended that the entire Citation and Complaint in Case Number 99-1921 be dismissed.

It is further recommended that Respondent be and hereby is formally admonished to institute more effective internal operating procedures with respect to authorizing any media advertising for skilled workers and to verifying in advance that all persons selected as independent contractors possess a proper license.

Dated: June 30, 1999.

OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Robert. I. Worth Administrative Law Judge

Original transmitted on _____________________

by: _____________________________ , to:

Mr. Michael P. Goldwater, Director Registrar of Contractors 800 West Washington, 6th Floor Phoenix, AZ 85007

ATTN: Joyce Armijo -----------------------

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