ALJDEC

99F-M1216-ROC · Registrar of Contractors · 1999-09-03

STATE OF ARIZONA IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Pursuant to notice, a formal hearing was held in this case on September 3, 1999, in Phoenix, Arizona, before Neal H. Jordan, Administrative Law Judge of the Office of Administrative Hearings. APPEARANCES For Complainant: Attorney James R. Hart, Esq. For Respondent: Failed to appear and attend.

FINDINGS OF FACT Based upon all the evidence of record, the following findings of fact are determined: Due and proper notice of the hearing scheduled for this matter was duly mailed to all parties of record and the Respondent failed to appear and attend although the hearing was delayed for a period of 20 minutes to accommodate a late appearance. Complainant is a licensed plumbing contractor who performed plumbing work on 11 custom homes being constructed by Respondent. The evidence is uncontroverted that Respondent has failed to pay to Complainant the value of the work completed on each of these custom home projects. The evidence is also uncontroverted and establishes that Respondent owes to Complainant the full sum of $22,601.49 as the fair value of all the work performed, including allowable finance charges as set forth in agreed upon proposals accepted by Respondent. Respondent has been fully paid by each new homeowner, which payment includes the value of the work performed by Complainant and forms the basis for a finding that Respondent has received sufficient monies as payment for the services and materials rendered by Complainant. There is no evidence that suggests that Complainant has failed to properly perform the work required for each and every custom home project or that it has in any manner breached the contracts entered into for each home. It is found on the basis of the evidence of record that Respondent has withheld payment to Complainant for insubstantial reasons. The evidence of record substantiates that C. R. Freeman, aka Charles R. Freeman, was listed as a qualifying party on a license in the State of New Mexico, which license was revoked on June 24, 1997. C. R. Freeman is listed on the Respondent’s license as the secretary. The bond presently posted by Respondent with the Registrar of Contractors is in the amount of $5,000.00. The evidence of record establishes that the value of the homes of the 11 projects that Complainant worked on was in excess of $1,000,000.

CONCLUSIONS OF LAW The Office of Administrative Hearings has jurisdiction over the subject matter and the parties hereto pursuant to A.R.S. §41-1092 - 1092.12 (1998). The Complainant has brought this complaint and accordingly bears the burden of proving by a preponderance of the evidence that the allegations contained therein are true. Culpepper v. State, 187 Ariz. 431, 930 P.2d 508 (Ct. App. 1996); Smith v. Arizona Department of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985), (the standard of proof is that of the “preponderance of evidence.”) The weight and sufficiency of the record establishes by a preponderance of evidence that Respondent has failed to pay monies due to Complainant in the total amount of $22,601.49, including all finance charges to the date of this decision, in violation of A.R.S. §32-1154 A (11). The weight and sufficiency of the evidence also establishes that by not paying Complainant the sums due and owing upon completion of the work in each project constitutes a wrongful act in violation of A.R.S. §32-1154 A (7). Further, A.A.C. R4-9-111(3) provides that the bond amount for general residential contractors whose gross volume of work in any fiscal year exceeds $750,000 shall be in the amount of $15,000. The bond posted by Respondent in amount of $5,000 is contrary to the requirements of this regulation and constitutes a wrongful act in violation of A.R.S. §32-1154A (3). By a preponderance of evidence, Complainant established that Respondent is in violation of A.R.S. §32-1154 A (21), by having C. R. Freeman, aka Charles R. Freeman, listed on the above captioned license when he is also named on a license that has been revoked in the State of New Mexico.

RECOMMENDED ORDER In view of the foregoing, it is recommended commencing on the effective date of the Registrar of Contractors’ Order that the Class B-2 license of Respondent be suspended until the Registrar of Contractors receives credible written proof that Respondent has paid or tendered the sum of $22,601.49 to Complainant. It is further recommended that if Respondent pays or tenders the above described sum of money on or before the effective date of the Registrar’s Order then the aforementioned indefinite license suspension shall not take place. It is further recommended, in addition to the foregoing indefinite license suspension, if any, that Respondent’s Class B-01 license be placed on a period of l80 days disciplinary probation. This additional disciplinary penalty shall commence on the effective date of the Registrar’s Order or the date on which notice of Respondent’s compliance with the terms of this Order is filed with the Registrar, whichever is later. It is further recommended, in addition to the above provided penalties, if any, that any restoration of Respondent’s rights to resume contracting, whether or not probationary, shall be subject to a condition that Respondent first post an additional surety bond, cash deposit or alternative deposit for a period of twenty-four (24) months, including future renewal periods, in the amount of $10,000.00, such bond or deposit to be for the sole benefit of persons injured as defined in A.R.S. § 32- 1131 (3) and to be in addition to the required surety bond, cash deposit or recovery fund participation set forth in A.R.S. § 32-1152 (D). Cash or alternative additional deposits, if utilized, shall be returned only after the expiration of an additional two year period following the above- provided twenty-four (24) month period and only if no claims are then pending. DONE AND ENTERED this day, September 3, 1999

______________________________________ Neal H. Jordan Administrative Law Judge

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

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

By ___________________________ -----------------------

Office of Administrative Hearings 1700 West Washington, Suite 602 Phoenix, Arizona 85007 (602) 542-9826