11-1902-20515-2
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF LABOR AND INDUSTRY
|
In the
Matter of the Residential Building Contractor License of |
FINDINGS OF
FACT, CONCLUSIONS, AND RECOMMENDATION |
The above-entitled matter came on for
hearing before Administrative Law Judge Barbara L. Neilson on July 27, 2009, at
9:30 a.m. at the Office of Administrative Hearings in
STATEMENT OF ISSUES
The issues presented in this case are
as follows:
(1) whether the Respondents, Lakeland
Remodeling & Construction, Inc., and Dale D. Ogdahl, its president, 100%
shareholder, and qualifying person, provided
false and misleading information on Lakeland’s license application by failing
to disclose that Mr. Ogdahl and a former licensee with whom he was affiliated
had been defendants in numerous civil lawsuits and named in outstanding civil
judgments;
(2) whether Mr. Ogdahl engaged in substandard workmanship on a previous
remodeling project;
(3) whether
Lakeland Remodeling failed to list its license number on its website and
instead listed the expired license number of another contractor; and
(4) whether,
by virtue of the above, the Respondents performed negligently or in breach of contract so as to cause
harm to the public; engaged in a
fraudulent, deceptive, or dishonest practice; or engaged in conduct that
demonstrates that they are untrustworthy, financially irresponsible, or
otherwise incompetent or unqualified to act under the license granted by the
Commissioner, and thus are subject to disciplinary action as set forth in the
Commissioner’s March 31, 2009, Licensing Order.
The Administrative Law Judge concludes
that the Respondents did engage in the misconduct alleged by the Department,
there are grounds for the Commissioner to impose discipline, and the March 31,
2009, Licensing Order issued by the Commissioner should be affirmed.
Based upon all of the proceedings
herein, the Administrative Law Judge makes the following:
FINDINGS OF FACT
1. On
November 5, 2008, the Department issued Respondent Lakeland Remodeling &
Construction, Inc. (“Lakeland Remodeling”), a residential building contractor
license (License No. 20632053). The
president, 100% shareholder, and qualifying person of Lakeland Remodeling is
Dale D. Ogdahl.[1] Previously Mr. Ogdahl was involved with another
licensee, Lakeland Door & Remodeling Corporation (“Lakeland Door”), which
was licensed by the Department as a residential building contractor under License
No. 20134082 from May 5, 1998, until the license was voluntarily terminated on
November 5, 2008.[2]
2. On
the license application for Lakeland Remodeling that was filed on or about
September 2, 2008, Respondents represented that they had never been defendants
in a lawsuit involving claims of breach of contract, had never been the subject
of any outstanding unsatisfied judgments relating to any residential
contracting or residential remodeling activities, and had never been affiliated
with a residential contractor that engaged in any activities that would result
in an affirmative answer to those questions.[3] However, Lakeland Door and/or Mr. Ogdahl
were, in fact, named as defendants in at least five prior lawsuits (four
involving suppliers and/or subcontractors, and one involving homeowners), and
judgments were obtained against them in those lawsuits between August 2007 and
June 2008 in the amounts of $22,807.69, $34,075.53, $14,104.17, $15,627.06, and
$1,401.64.[4] Only the $22,807.69 judgment was satisfied as
of the date of Lakeland Remodeling’s license application.[5] The homeowners who obtained the judgment for
$14,104.17 sought and received a court order directing payment of $6,770.58
from the Contractor’s Recovery Fund.[6]
3. On
February 20, 2009, Mr. Ogdahl d/b/a Lakeland Door & Remodeling filed an
individual Chapter 7 bankruptcy petition.[7] The case was dismissed on June 10, 2009, due
to Mr. Ogdahl’s failure to appear and submit to examination at the meeting of
creditors.[8]
4. The
website of Lakeland Remodeling does not list its own license number, but
instead lists the expired license number of Lakeland Door.[9]
5. On
March 31, 2009, the Department served Respondents Lakeland Remodeling and its
principal, Dale D. Ogdahl, individually, with a Licensing Order which revoked
the residential building contractor’s license of Lakeland Remodeling. The Order also required Lakeland Remodeling
and Mr. Ogdahl individually and doing business under any business name to cease
and desist from acting or holding themselves out as a residential building
contractor, residential remodeler, or residential roofer in the state of
Minnesota.[10]
6. On
or about April 30, 2009, the Department received Respondents’ request for a
hearing to contest the March 31, 2009, Order.[11]
7. The
Notice and Order for Prehearing Conference initiating this contested case
proceeding was served on the Respondents via first class mail on May 8, 2009,
at the following address:
8. The Notice and
Order for Prehearing Conference contained the following language:
Respondents’
failure to appear at the hearing or any prehearing conference, or any failure
to comply with an order of the Administrative Law Judge, may result in a
finding that the Respondents are in default, that the Department’s allegations
contained in this Notice and Order may be accepted as true, and its proposed
action may be upheld.[13]
9. The Notice and
Order for Prehearing Conference set a prehearing conference for June 24, 2009,
at 1:30 p.m.[14]
10. On June 24,
2009, Mr. Ogdahl participated in the prehearing conference on behalf of
Lakeland Remodeling and himself. During
the prehearing conference, the
Administrative Law Judge ordered that this case would be consolidated for
hearing with another case (In the Matter
of the Residential Building Contractor License of Lakeland Door and Remodeling Corporation,
OAH Docket No. 11-1902-20516-2). The
hearing in the consolidated cases was set to commence on July 27, 2009, at
9:30 a.m., in the courtrooms of the Office of Administrative Hearings,
11. On or about
July 22, 2009, Mr. Ogdahl sent a fax to counsel for the Department indicating
that he was voluntarily surrendering the license for Lakeland Remodeling.[15]
12. On or about
July 22, 2009, Mr. Ogdahl contacted the Administrative Law Judge and indicated
that he wished to postpone the hearing until the following month. The Administrative Law Judge told Mr. Ogdahl
to contact counsel for the Department to find out if the Department had any
objection to a continuance and, if the Department objected, to contact the Administrative
Law Judge so that a conference call could be arranged to discuss the request. Mr. Ogdahl never contacted the Administrative
Law Judge to request a conference call.
13. On Friday, July
24, 2009, the Administrative Law Judge left a voice mail message for Mr. Ogdahl
in which she informed him that the hearing remained set for Monday, July 27,
2009. In the message, the Judge directed
Mr. Ogdahl to call her that day (July 24, 2009) if he still wanted a
continuance so the request could be discussed in a conference call with the
parties. The Administrative Law Judge never
received a return call from Mr.
Ogdahl.
14. No one appeared
at the hearing on July 27, 2009, on behalf of the Respondents. The Respondents were not granted a
continuance prior to the hearing. The
Respondents did not contact the Administrative Law Judge between the date of
the hearing and the date of this Report to offer any explanation for their
failure to appear.
15. Because the
Respondents failed to appear at the hearing in this matter, they are in
default. Pursuant to Minn. Rules part
1400.6000, the allegations contained in the Notice and Order for Prehearing
Conference are hereby taken as true and incorporated into these Findings of
Fact.
Based upon the foregoing Findings of
Fact, the Administrative Law Judge makes the following:
CONCLUSIONS
1. The Administrative Law Judge and the
Commissioner of the Department of Labor and Industry have jurisdiction over
this matter pursuant to Minn. Stat. §§ 14.50, 326B.082,
326.083, and 326B.84.
2. The Notice and Order for Prehearing
Conference issued by the Department was proper and the Department has fulfilled
all relevant substantive and procedural requirements of law and rule.
3. The Respondents, having made no
appearance at the hearing, and not receiving a continuance or other relief, are
in default. Pursuant to Minn. Rules part
1400.6000, the allegations contained in the Notice and Order for Prehearing
Conference are hereby taken as true.
4. Minn. Stat. § 326B.84 authorizes the
Commissioner of Labor and Industry to deny, suspend, limit, place conditions
on, or revoke a license, or censure the person holding the license, if the
licensee, qualifying person, or agent owner:
(1) has filed an application for licensure . .
. which is incomplete in any material respect or contains any statement which,
in light of the circumstances under which it is made, is false or misleading
with respect to any material fact;
(2) has engaged in a fraudulent, deceptive, or
dishonest practice;
* * *
(4) has failed to reasonably supervise
employees, agents, subcontractors, or salespersons, or has performed
negligently or in breach of contract, so as to cause injury or harm to the
public;
(5) has violated or failed to comply with any
provision of sections 326B.802 to 326B.885, any rule or order under sections
326B.802 to 326B.885, or any other law, rule, or order related to the duties
and responsibilities entrusted to the commissioner; [or]
* * *
(15) has engaged in an act or practice whether or
not the act or practice directly involves the business for which the person is
licensed, that demonstrates that the applicant or licensee is untrustworthy,
financially irresponsible, or otherwise incompetent or unqualified to act under
the license granted by the commissioner. . . .
5. Minn. Stat. § 326B.082, subd. 12,
authorizes the Commissioner to issue a licensing order revoking a license,
imposing monetary penalties of up to $10,000 for each violation, and requiring
that the person cease and desist from committing the violation.
6.
7.
8. Based upon the facts alleged in the
Notice and Order for Prehearing Conference and reflected in Exhibits 1-20 which
were received during the hearing, the Respondents have provided false, misleading,
and deceptive information in connection with their application for licensure,
have harmed the public by performing negligently or in breach of contract, have
failed to display their proper license number, and have engaged in conduct that
demonstrated that they are untrustworthy, financially irresponsible, or
otherwise incompetent or unqualified to act under a residential building
contractor license, in violation of Minn. Stat. § 326B.84(1), (2), (4), (5),
and (15), Minn. Stat. § 326B.87, subd. 2, and
9. The Respondents are subject to discipline
and/or a civil penalty pursuant to Minn. Stat. §§ 326B.082,
326B.083, and 326B.84. The imposition of sanctions is in the public interest.
Based upon the foregoing
Conclusions, the Administrative Law Judge makes the following:
IT IS HEREBY RECOMMENDED
that the March 31, 2009, Licensing Order issued by the Commissioner of Labor
and Industry against the Respondents,
Dated: September 4, 2009
|
s/Barbara
L. Neilson |
|
BARBARA
L. NEILSON |
|
Administrative
Law Judge |
Reported: Digitally recorded (no transcript prepared).
This Report is a recommendation, not
a final decision. The Commissioner of
Labor and Industry will make the final decision after a review of the
record. The Commissioner may adopt,
reject or modify the Findings of Fact, Conclusions, and Recommendations. Under Minn. Stat. § 14.61, the final decision
of the Commissioner shall not be made until this Report has been made available
to the parties to the proceeding for at least ten days. An opportunity must be afforded to each party
adversely affected by this Report to file exceptions and present argument to
the Commissioner. Parties should contact
the Office of the Commissioner of Labor and Industry,
If the Commissioner fails to issue a final decision within 90 days of the close of the record, this report will constitute the final agency decision under Minn. Stat. § 14.62, subd. 2a. The record closes upon the filing of exceptions to the report and the presentation of argument to the Commissioner, or upon the expiration of the deadline for doing so. The Commissioner must notify the parties and the Administrative Law Judge of the date on which the record closes.
[1] March 31, 2009, Licensing Order, p. 2, ¶¶1-2 (attached to and incorporated in Notice and Order for Prehearing Conference); Exhibit 11, pp. 3-5; Exhibit 15.
[2] March 31, 2009, Licensing Order, p. 2, ¶ 3; Exhibit 12.
[3] March 31, 2009, Licensing Order, p. 2, ¶ 4; Exhibit 11, p. 2 (Questions 5, 8, and 11).
[4] Exhibits 1-5, 12, 13; March 31, 2009, Licensing Order, p. 2-3, ¶ 4.
[5] Exhibit 13.
[6] Exhibit 10.
[7] March 31, 2009, Licensing Order, p. 3, ¶6; Exhibit 16.
[8] March 31, 2009, Licensing Order, p. 3, ¶ 6; Exhibit 17.
[9] March 31, 2009, Licensing Order, p. 3, ¶5; Exhibits 14, 18.
[10] Notice and Order for Prehearing Conference, p. 2, ¶¶ 1-2; March 31, 2009, Licensing Order (attached to Notice and Order for Prehearing Conference).
[11] Notice and Order for Prehearing Conference, p. 2, ¶ 4; Exhibit 19.
[12] Affidavit of Service by First Class Mail of Ann Kirlin attached to Notice and Order for Prehearing Conference.
[13] Notice and Order for Prehearing Conference, p. 3, ¶1.
[14] Notice of Hearing, p. 1.
[15] Exhibit 20.