IN THE OFFICE OF ADMINISTRATIVE HEARINGS
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1 IN THE OFFICE OF ADMINISTRATIVE HEARINGS Shawn Stole Construction Inc., COMPLAINANT, v. Micela Properties Inc., License No: 00 RESPONDENT. No. 0A--ROC ADMINISTRATIVE LAW JUDGE DECISION HEARING: August, 0 APPEARANCES: Shawn Stole, Owner and Qualifying Party, appeared on behalf of Complainant Shawn Stole Construction Inc. Respondent Micela Properties Inc. was represented by John Marcolini. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer FINDINGS OF FACT 1. Respondent Micela Properties Inc. (Respondent) is the holder of License No. 00 issued by the Registrar of Contractors (Registrar).. On or about June, 0, Complainant Shawn Stole Construction Inc. (Complainant) filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the sum of $,0.00 for cabinet work on a custom home project.. The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a Citation for Alleged Violation of A.R.S. -(A)().. Shawn Stole, Complainant s Owner and Qualifying Party, testified that Complainant was brought on to the project after the prior cabinet subcontractor failed to perform its contract. Mr. Stole indicated that Complainant began work on the project under a time and materials contract to be paid weekly, but was not paid by Respondent 0 Office of Administrative Hearings 0 West Washington, Suite 1 Phoenix, Arizona 00 (0) -
2 for three weeks. 1 At that time, Respondent requested that the contract be renegotiated to a set price contract. Mr. Stole stated he originally quoted $,000.00, but Respondent felt that was too high. Complainant drafted a Proposal dated April, 0, with a scope of work to Supply labor & material to complete cabinet installation that was not completed by other contractor throughout project. This includes refinishing kitchen & breakfast cabinets, touch up other cabinetry (no refinishing on other cabinetry) and a total cost of $0, The printed proposal also provided PAYMENT TERMS: PROGRESS BILLINGS PAYMENTS OF APPROXIMATELY % EACH. That proposal was not signed as written. Rather, the cost of $0, was crossed off at three locations. Handwritten on the bottom of the proposal were the following notes:,000 out the door weekly payments of $,0.00 0% complete honored by May th 0 First payment by -1- Below the handwritten notes, the proposal was signed by both Complainant and Respondent.. Mr. Stole testified that the first payment was received on April 1, 0, Complainant left the job on May, 0, and the second payment was received on May 1, 0. Mr. Stole acknowledged that the project was not completed, but asserted that Respondent refused to sign off on the plans for the garage cabinets (the subject of a separate, second contract). Mr. Stole stated that he was worried Complainant would find a reason to refuse the garage cabinets once they were on site and withhold payment on the second contract, and he was unwilling to take that risk. Mr. Stole also testified that Complainant performed some additional staining in the memorabilia room that was beyond the scope of the contract that Respondent had not paid. Mr. Stole acknowledged that Complainant had not earned the final payment under the contract, but was seeking the third payment. 1 Mr. Stole acknowledged that the instant complaint did not include Complainant s claims of nonpayment under the time and materials contract. Mr. Stole indicated he felt compelled to accept the terms of the contract for fear of not getting any payment under the time and materials contract.
3 Luigi Micela, Respondent s Owner and Qualifying Party, testified that from the beginning of the contract, Complainant failed to have enough manpower on the project to meet the agreed upon timeline. Mr. Micela stated he withheld payment because Complainant did not earn the payment. Mr. Micela argued that Complainant and Respondent had disagreements as to whether certain items were included in the contract, specifically grilles and appliance fronts. Mr. Micela estimated that Complainant had completed approximately 0 percent of the work required under the contract in question and 0 percent of the work required under the second contract. Mr. Micela acknowledged that Complainant performed additional staining, but calculated the work to be worth approximately $ Mr. Micela concluded that Respondent did not owe Respondent any money under the first contract. Mr. Micela also indicated that Respondent had filed a workmanship complaint against Complainant in a separate proceeding with the Registrar.. Respondent did not provide documentation to establish that it lacked the capacity to pay the amount Complainant asserted was due. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these matters is by a preponderance of the evidence. See A.A.C. R--1.. 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 (0).. A.R.S. -(A)() includes among the grounds for suspension, revocation, or other disciplinary action against a contractor s license, [f]ailure by a licensee or agent or official of a licensee to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee's operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased. 0
4 The evidence established that, under the contract, Respondent was to make four weekly payments beginning on April 1, 0. As such, Respondent should have made payments on April 1, 0; April 0, 0; April, 0; and May, 0. The contract, as agreed to by the parties, did not tie the payments to any benchmark in completion of the contract. Respondent made only two of those payments on April 1, 0, and May 1, 0. Therefore, Complainant established that Respondent owed the third payment of $,0.00 that was due on April, 0.. Respondent failed to establish by a preponderance of the evidence that it lacked the ability to pay Complainant for the monies due under the contract or that it had not been paid sufficient monies on the project to pay Complainant.. Therefore, Complainant established that Respondent violated A.R.S. -(A)() by failing to pay Complainant $,0.00 for services or materials rendered in connection with Respondent s contracting business.. Based upon Respondent s violation of the provisions of A.R.S. - (A)(), grounds exist to impose discipline against Respondent s license RECOMMENDED ORDER Based on the foregoing, it is recommended that the Registrar suspend Respondent Micela Properties Inc. s License No. 00 issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $,0.00 in certified funds. It is further recommended that when and if the Registrar receives and accepts Respondent s evidence that it has paid Complainant $,0.00 in certified funds, the Registrar may dismiss the Complaint in Case No. 0-. In the event of certification of this Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be 0 days from the date of the certification. Done this day, September 1, 0. /s/ Tammy L. Eigenheer Administrative Law Judge 0
5 Transmitted electronically to: Jeffrey Fleetham, Director Registrar of Contractors
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