NOTICE: NOT FOR OFFICIAL PUBLICATION.

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE

ARIZONA COURT OF APPEALS

DIVISION ONE

UNIVERSAL HOMES CONSTRUCTION LLC, Petitioner/Appellant,

v.

IVY LYNN MITCHELL, et al., Respondents/Appellees.

No. 1 CA-CV 18-0501

Appeal from the Superior Court in Maricopa County

No. LC2017-000445-001

The Honorable Patricia A. Starr, Judge

AFFIRMED

COUNSEL

Righi Fitch Law Group, PLLC, Phoenix

By Richard L. Righi, Marcus D. Tappe

Counsel for Petitioner/Appellant

FILED 5-21-2019
2

Robert C. Kozak, PLLC, Prescott

By Robert C. Kozak

Co-Counsel for Respondent/Appellee Ivy Lynn Mitchell

Suits Law Firm, PLC, Prescott

By Douglas J. Suits

Co-Counsel for Respondent/Appellee Ivy Lynn Mitchell

Arizona Attorney General’s Office, Phoenix

By John R. Tellier

Counsel for Respondent/Appellee Arizona Registrar of Contractors

MEMORANDUM DECISION

Presiding Judge Lawrence F. Winthrop delivered the decision of the Court, 

in which Judge Kent E. Cattani and Judge Diane M. Johnsen joined.

W I N T H R O P, Judge:

¶1 Universal Homes Construction, LLC (“Universal”) appeals 

the superior court’s decision affirming the order of the Arizona Registrar of 

Contractors (the “ROC”) finding that Universal violated statutory 

obligations when performing work for homeowner Ivy Lynn Mitchell and 

suspending Universal’s contractor’s license. For the following reasons, we 

affirm.

FACTS AND PROCEDURAL HISTORY

¶2 In 2016, Mitchell moved from Alabama to Prescott Valley, 

Arizona. She contracted with Universal to build a home with ceramic tile 

floors.

¶3 In December 2016, Mitchell informed Universal of what she 

believed to be several issues with the tile installation. According to the

Workmanship Standards for Licensed Contractors published by the ROC, 

the vertical displacement, or “lippage,” for ceramic tile must be 1/32 of an 

inch or less. Mitchell stated that more than twelve tiles contained lippage 

ranging from 1/8, 3/16, and 1/16 of an inch. She indicated that the uneven 

height of the tile created a serious hazard for her to trip and fall due to her

ALS, or amyotrophic lateral sclerosis, and she asserted the only way to 
UNIVERSAL HOMES v. MITCHELL, et al.

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3

repair the flooring was to re-tile the entire home. In February 2017, 

Universal responded and agreed to replace the non-conforming tiles but 

refused to re-tile the entire home. Mitchell then filed a complaint with the 

ROC. In addition to the lippage, she identified several hollow and cracked 

tiles. Universal timely responded to the complaint and contested the 

allegations.

¶4 An inspection of the home occurred on March 28, 2017. The 

ROC inspector determined Universal failed to meet minimum 

workmanship standards in violation of Arizona Administrative Code 

(“A.A.C.”) R4-9-108 and Arizona Revised Statutes (“A.R.S.”) § 32-

1154(A)(22) (2019).

1 The ROC issued a directive (the “Directive”) 

mandating that Universal fix approximately thirty-five tiles with noncompliant lippage and replace several hollow or cracked tiles. The repairs 

had to be made on or before April 15, 2017. Because Mitchell was in the 

process of moving, she requested a ten-day extension on the repair 

deadline, and the ROC granted her request. Universal attempted to 

conduct repairs on April 12 and April 20, 2017, but Mitchell denied the 

workers access to the home because her furniture would need to be moved.

The ROC agreed the repairs could be completed in May 2017. Universal 

thereafter provided written notice to the ROC that it had completed those 

repairs over a three-day period in May.

¶5 The ROC then sent notice to both Universal and Mitchell that 

a follow-up inspection to review the repairs would be conducted on June 2, 

2017. That inspection indicated that four tiles still failed to meet the lippage 

standard. The ROC issued a citation to Universal stating that it had violated 

the workmanship standard under A.A.C. R4-9-108—thereby violating

A.R.S. § 32-1154(A)(3)—and the timeliness requirement for repairs under 

A.R.S. § 32-1154(A)(22). Universal requested Mitchell allow access to 

attempt further repairs, but Mitchell refused.

¶6 Universal contested the citation, and an administrative 

hearing was held in August 2017. The ALJ determined Universal violated 

A.A.C. R4-9-108 and § 32-1154(A)(3) but not § 32-1154(A)(22). The ALJ 

reasoned that because Mitchell repeatedly refused Universal access to her 

home, valid justification existed for Universal not completing the repairs.

The ALJ also determined disciplinary action should not be taken against 

Universal and Mitchell’s complaint should be dismissed. Mitchell 

 

1 Absent material revision after the relevant dates, we cite the current 

version of the statutes and rules.
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requested review of the decision, and the ROC issued a final administrative 

decision (the “ROC Decision”) in September 2017. The ROC modified the 

ALJ’s decision by removing “conclusion of law #9” and substituting three 

new conclusions of law to reflect its decision that Universal violated A.R.S. 

§ 32-1154(A)(22). The ROC also imposed a one-day suspension of 

Universal’s contractor’s license pursuant to A.R.S. § 32-1154(B).

¶7 Universal appealed to the superior court, and the superior 

court affirmed the ROC Decision. Universal timely appealed to this court, 

and we have jurisdiction pursuant to A.R.S. § 12-2101(B).2

ANALYSIS

I. The ROC Decision is Supported by Substantial Evidence

¶8 In administrative proceedings, the decision of the agency 

director, not the ALJ, is the final administrative decision. J.L.F. v. Ariz. 

Health Care Cost Containment Sys., 208 Ariz. 159, 161, ¶ 12 (App. 2004). As 

the final decision maker in a contested agency proceeding, an agency, 

through its director, has the authority to make independent findings of fact

and conclusions of law, and it is not bound by an ALJ’s findings. Id. at 162, 

¶ 12.

¶9 In reviewing a superior court judgment affirming an 

administrative action, we determine whether the agency’s decision is 

supported by substantial evidence, or whether it is instead arbitrary or

capricious, or otherwise constitutes an abuse of the agency’s discretion.

Sanderson Lincoln Mercury, Inc. v. Ford Motor Co., 205 Ariz. 202, 205, ¶ 8

(App. 2003) (citing A.R.S. § 12-910(E)). If the agency’s decision is supported 

by substantial evidence, we will uphold the decision even if the record also 

supports a different conclusion. DeGroot v. Ariz. Racing Comm’n, 141 Ariz. 

331, 336 (App. 1984).

¶10 An administrative agency’s determination will be set aside as 

arbitrary and capricious only if an appellate court determines “there has 

been unreason[ed] action, without consideration and in disregard for facts 

and circumstances.” Petras v. Ariz. State Liquor Bd., 129 Ariz. 449, 452 (App. 

1981). But “where there is room for two opinions, the action is not arbitrary 

 

2 Universal named the ROC as an appellee in this appeal as required 

by A.R.S. § 12-908. The ROC filed an answering brief identifying itself as 

only a nominal party for the appeal. See Int’l Bhd. of Elec. Workers, Local 

Union 640 v. Kayetan, 119 Ariz. 508, 510 (App. 1978) (“[T]he role of the 

agency-defendant in [appellate] court proceedings may be a passive one.”).
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or capricious if exercised honestly and upon due consideration, even 

though it may be believed that an erroneous conclusion has been reached.”

Id.

¶11 Universal contends the ROC erred by modifying the ALJ’s 

conclusions of law. Specifically, Universal asserts: (1) it met the exception 

under A.R.S. § 32-1154(A)(22), so the agency’s determination of a violation 

was not supported by substantial evidence; (2) the modifications are

arbitrary, capricious, and not supported by substantial evidence; and (3) the 

modifications are self-contradictory, making them unenforceable.

A. A.R.S. § 32-1154(A)(22) Violation

¶12 Section 32-1154(A) enumerates various acts and omissions 

that could subject a licensee to disciplinary action. Section 32-1154(A)(22) 

prohibits ROC licensees from failing to take “appropriate corrective action

. . . without valid justification” in response to a written directive by the 

ROC. Universal asserts that Mitchell repeatedly refused its workers access 

to her home, and therefore a “valid justification” existed for its failure to 

make all the necessary repairs in a timely manner. The ALJ agreed with 

this argument, but on review, the ROC found the argument unpersuasive.

¶13 The ROC Decision explained that because of the access issues,

the inspector extended the deadline for Universal to comply with the 

Directive. Once allowed access, however, Universal still failed to 

satisfactorily complete the corrective action directed by the ROC. Thus, the 

ROC determined Universal violated A.R.S. § 32-1154(A)(22).

¶14 On appeal, Universal does not cite to any authority to support 

its argument that it should have been given additional time to comply with 

the Directive after the ROC issued the citation following the June

inspection. The record shows that Universal was given an adequate 

opportunity to correct its workmanship, but it failed to do so. Although 

Mitchell initially made access to her home difficult for Universal, the access 

issues were resolved when the ROC extended the deadline for compliance. 

Universal gave notice that it had completed the subject repairs within the 

time allowed by the ROC, and Universal did not request any additional 

time or opportunity to do any further work until after the ROC had issued 

its notice of violation.

¶15 Mitchell was not required to allow Universal additional time 

beyond the extension granted by the ROC to comply with the Directive.

Indeed, as the ROC Decision later noted, “while the Registrar encourages 

parties to continue efforts to resolve a complaint’s underlying issues, there 
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is no ongoing duty to grant access to the jobsite after the written directive’s 

deadline expires.”

B. The ROC Decision Was Not Arbitrary or Capricious

¶16 Universal asserts the ROC Decision disregarded all the 

evidence presented at the administrative hearing and imposed an extreme 

penalty as a result. However, Universal did not include a transcript of the 

hearing in the appeal record; accordingly, to the extent Universal’s 

argument turns on what occurred at the hearing, the missing transcript is 

presumed to support the ROC’s conclusion. See Myrick v. Maloney, 235 Ariz. 

491, 495, ¶ 11 (App. 2014). Further, Universal acknowledges that it was

given an initial opportunity to repair all the tiles, yet it failed to do so. As 

such, we conclude the ROC Decision was not “without consideration and 

in disregard for facts and circumstances.” Petras, 129 Ariz. at 452.

¶17 Universal also argues the ROC Decision was arbitrary and 

capricious because, during the pendency of these proceedings, Mitchell 

contacted the inspector’s supervisor and Arizona State Senator Karen Fann 

to complain about the ROC inspector’s handling of her claim. Universal 

contends the ROC only reversed the ALJ’s decision to “appease” Mitchell 

and to encourage her to abandon these additional complaints. Beyond this 

bare assertion, however, Universal offers no evidence of any biased conduct

by the ROC, and we will not reverse the decision based on an allegation

alone. See ARCAP 13(a)(7).

C. The ROC Decision is Enforceable

¶18 Finally, Universal argues that the modifications made in the 

ROC Decision contradict the findings adopted by the ROC from the ALJ’s 

decision. Universal asserts the decision is unenforceable because it 

simultaneously stated that Universal did and did not violate § 32-

1154(A)(22).

¶19 Under § 41-1092.08(B), an administrative agency may modify 

an ALJ’s written decision. In addition, § 32-1154(B) states the ROC may 

temporarily suspend a license if a licensee commits any of the prohibited 

acts identified in § 32-1154(A). Here, the ROC suspended Universal’s 

license for one day due to its failure to comply with not only 

§ 32-1154(A)(22), but also A.A.C. R4-9-108 and § 32-1154(A)(3). Assuming 

without deciding that some of the modifications made by the ROC 

contradicted other findings adopted from the ALJ’s decision regarding § 32-

1154(A)(22), the ROC nevertheless acted within its authority in suspending 

Universal’s license pursuant to § 32-1154(A)(3). Therefore, we conclude 
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7

that the administrative decision is enforceable—any error made by the 

director in issuing the administrative decision was harmless, and we will 

not disturb the ROC’s ultimate determination. Creach v. Angulo, 186 Ariz. 

548, 550 (App. 1996) (citation omitted) (“To justify the reversal of a case, 

there must not only be error, but the error must have been prejudicial to the 

substantial rights of the party. Furthermore, prejudice is not presumed but 

must appear from the record.”).

II. Costs on Appeal

¶20 Mitchell requests her costs incurred in this appeal. As the 

successful party, we award her costs pursuant to A.R.S. § 12-341 contingent 

on her compliance with ARCAP 21.

CONCLUSION

¶21 For the foregoing reasons, we affirm the superior court’s 

order affirming the ROC Decision. Ritland v. Ariz. State Bd. of Med. Exam’rs, 

213 Ariz. 187, 192 (App. 2006) (explaining that if there is substantial 

evidence in the record to support both the ALJ’s finding and the 

administrative agency’s decision to overrule it, this court will uphold the 

decision of the agency).