ALJDEC

99F-R0022-ROC · Registrar of Contractors · 1999-04-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 7, 1999 APPEARANCES: Assistant Attorney General Patti Shelton on behalf of the Registrar of Contractors; Robert Kupfer on his own behalf ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________ FINDINGS OF FACT 1. On December 1, 1988, the Registrar of Contractors issued Robert Lee Kupfer (“Mr. Kupfer”) License Number 081030, a B-1 license. Subsequent to such licensure, Mr. Kupfer conducted business under the name of Kupfer Construction. 2. On June 4, 1997, the Registrar of Contractors received a complaint filed against Kenneth Meyers for contracting without a license on a commercial project located at 2824 Sweetwater, Lake Havasu City , Arizona. 3. Upon investigation by the Registrar of Contractors, it was discovered that Kenneth Meyers was working on the above-mentioned project as an employee of Kupfer Construction, under the supervision of Mr. Kupfer. 4. The investigation conducted by Registrar of Contractors Investigator Herschel Eaves (“Investigator Eaves”) revealed that during 1996 and the first quarter of 1997, Mr. Kupfer withheld state taxes, federal taxes, and F.I.C.A. from the paychecks of his employees, including Kenneth Meyers, but did not pay any of those funds to the appropriate taxing authorities. 5. The above-mentioned investigation also revealed that Mr. Kupfer did not report to the Arizona Department of Economic Security (“DES”) that Kupfer Construction had any employees for 1996 and for the first two quarters of 1997. 6. Mr. Kupfer credibly testified that he and Christine Snyder organized HBRC Development, Inc. (“HBRC”) to be a development/construction company. 7. HBRC filed its corporate documents with the Arizona Corporation Commission and obtained a business license. Subsequently, before it could file for licensure with the Registrar of Contractors, HBRC had its Articles of Incorporation revoked after Christine Snyder resigned. According to Mr. Kupfer, HBRC has never been issued a license by the Registrar of Contractors and did not perform any construction work prior to it becoming inactive. 8. HBRC did not report to DES that it had any employees for 1996 or for the first quarter of 1997. 9. It is undisputed that Kupfer Construction did not have workers’ compensation for its employees during the relevant time period. 10. It is undisputed that prior to May 31, 1997, HBRC had workers’ compensation for its employees but that after that date, HBRC did not maintain such coverage. 11. During the hearing, Mr. Kupfer admitted that during the relevant time period, he withheld funds for employees for taxes and F.I.C.A. and did not provide those funds to the appropriate taxing authorities. He offered no explanation as to why that occurred but represented that he now uses Labor Express to hire individuals on a temporary job by job, day by day basis so as to avoid similar problems in the future. 12. During the course of his investigation, Investigator Eaves examined all building permits issued to Mr. Kupfer in Lake Havasu City, Arizona. As a result of that examination and discussions with Mr. Kupfer, Investigator Eaves discovered that Mr. Kupfer had constructed a carport at 825 Yaqui Lane, Lake Havasu City, Arizona, a residential structure. 13. It is undisputed that Mr. Kupfer has never been issued a residential contractors license in the State of Arizona and, at the time when work was performed by Mr. Kupfer with respect to the above-mentioned carport, Mr. Kupfer held a commercial contractor’s license. 14. During the hearing, Mr. Kupfer admitted to having constructed the carport and not being appropriately licensed during that time. Mr. Kupfer further admitted that he knew at that time that he was not appropriately licensed but still performed the work. He could not recall the reason why he took such action and offered no excuse or defense as to contracting outside the scope of the contractor’s license he held at that time. 15. In mitigation, Mr. Kupfer represented that he has been licensed by the Registrar of Contractors for over ten years and has never contracted without being appropriately licensed except for the above-mentioned instance , that occurred nine years ago. Further, Mr. Kupfer maintained that there has been no issue as to his workmanship with regard to that job. CONCLUSIONS OF LAW The evidence of record established that Mr. Kupfer has violated the provisions of A.R.S.§ §32-1154(A) (4) and (5), and 32-1151.

RECOMMENDED ORDER Although the actions of Mr. Kupfer, as set forth above, are not to be condoned, the isolated, singular act of contracting without a license approximately nine years ago without any complaint regarding workmanship, along with approximately nine years of licensure as a commercial contractor with the Registrar of Contractors without any such reoccurring acts is taken into consideration. The Administrative Law Judge also notes that it is not the primary function of the Registrar of Contractors to enforce tax and workers’ compensation laws, though such laws are important. Based on the above, on the effective date of the Order entered in this matter, Mr. Kupfer’s Class B-1 license shall be suspended for five days and immediately after the expiration of such suspension the license shall be placed on probation for an additional ninety days. Done this day, April 20, 1998

______________________________________ Lewis D. Kowal Administrative Law Judge

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

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

ATTN: Joyce Armijo

By ___________________________

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