ALJDEC

00F-1809-ROC · Registrar of Contractors · 2000-11-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 1, 2000 APPEARANCES: Complainant appeared through its Secretary/Treasurer, Michael Phalin and Respondent appeared through its president, Cynthia Robinson. ADMINISTRATIVE LAW JUDGE: Mark A. Silver _____________________________________________________________________ Evidence and testimony were presented and, based upon the entire record in this matter, the following Findings of Fact, Conclusions of Law, and Recommended Order are made:

FINDINGS OF FACT

1. Pursuant to written contract, Respondent was retained by Complainant for the purpose of removing their existing asphalt driveway and parking lot and placing a new asphalt surface in said areas. Complainant alleges certain deficiencies in the work performed and/or materials provided by Respondent and same are discussed in the findings below.

2. At the outset of the scheduled hearing, Complainant averred that the issues of the gate opener sensor and a specified electrical line had been previously resolved and therefore, would not be issues to be decided at the instant hearing.

3. The following salient facts were adduced at the hearing and are important to note:

a. On or about June 23, 1999 Respondent submitted its bid to perform the above-described work. Shortly after submission of the proposal, same was accepted by Complainant. b. The work in question was scheduled to be performed sometime in August 1999. Due to Respondent’s concern regarding possible rain at that time of the year having a deleterious effect on their work, it submitted another document for Complainant’s signature, prior to performing the work. The document in question is dated August 20, 1999 and same was ultimately signed by both parties. c. Respondent contends that the August 20, 1999 document constitutes a “waiver” or disclaimer that in the event of rain during the course of the asphalt project, Respondent would not be responsible for any damage or needed repairs. d. The project took approximately three days to complete. There was no rain during any of the days. However, the weight of the evidence of record was sufficient to support a finding that a very light rain occurred on the night of the second day of the project. e. When the project was completed there were a number of issues that Complainant was not satisfied with. A degree of remedial work was performed by Respondent but same failed to resolve the issues between the parties, ultimately resulting in the filing of the instant complaint with the Registrar of Contractors.

4. The weight of the credible evidence of record was sufficient to support a finding that the following constitute substandard and unacceptable workmanship and/or materials attributable to Respondent:

a. The asphalt surface placed by Respondent is uneven, having numerous high and low spots. b. Areas of the new asphalt surface reveal exposed aggregate material. c. During the course of the project, Respondent broke numerous tiles in the covered entry area to the building. The tiles in question consisted of white and tan/gray tiles. The broken white tiles have been replaced by a tile contractor retained by Respondent but the broken tan/gray tiles still remain as an unresolved issue. d. A specified canopy was damaged by Respondent, as manifested by oil spilling onto the canopy and an area of chipped paint. e. “Sand patches” previously installed by Respondent are failing to adhere properly to the asphalt placed by Respondent, and are higher than the adjacent areas of the parking lot and driveway, thereby contributing to the uneven surface of the new asphalt paving job and to excessive ponding of water in specified areas. f. During the course of construction, Respondent broke a water line. Complainant used its own building maintenance staff to repair this water- line. g. Specified signs for the building were broken by Respondent and Complainant has paid for replacements of said signs. No bills for this cost were submitted into evidence at the hearing. Nevertheless, Respondent is on notice that it is responsible to either pay or give a credit to Complainant for all reasonable costs necessary to replace the signs and to fix the above-described broken water line.

5. Respondent contends that the aforementioned August 20, 1999 “waiver” or disclaimer absolves it from any responsibility or liability for the uneven appearance of the asphalt paving job, due to the light rain that occurred on the evening of the second day of the job.

6. Disclaimers of liability are frowned upon in the law as being contrary to public policy. For a disclaimer to have any enforceability, it must be clearly established by substantial evidence that the matter being disclaimed was so carefully explained and accepted that little doubt remains as to the intent of the parties.

7. The disclaimer or “waiver” at issue herein states, in pertinent part:

“…No new ABC, or other sub-grade materials or work is included in this proposal. Executive Towers Condominium has been advised of the possibility of rain and possible damages associated with it…there could be possible damages to the existing ABC or grade…need for removal and replacement of base materials, need for additional grading of base materials…Executive Towers Condominium has been advised of the above possibilities and has been given the opportunity to reschedule the work…Executive Towers assumes all financial and legal responsibilities in the event of rain during the performance of our scheduled work” (emphasis added).

8. The record presented herein showed that a compaction test had been performed on the ABC sub-base, prior to the time that Respondent worked on the project, and the compaction of said material was shown to be adequate. The weight of the evidence of record was sufficient to support a finding that in the process of removing the existing asphalt surface, Respondent tore up a significant amount of the ABC sub-base. Notwithstanding the terms of the August 20, 1999 document, Respondent would properly be held to be responsible for any damage that it caused to the sub- base during the removal of the asphalt parking lot. In addition, the evidence of record was inadequate to establish that any rain which occurred on the night of the second day was significant enough to cause any damage to the exposed sub-base.

9. The language contained in Respondent’s alleged “waiver” or disclaimer is not found to be effective to relieve Respondent of any responsibility for a substandard job. It merely indicates that in the event that additional ABC or grading might be required due to rain damage only, Complainant would be required to pay the costs for said additional work and/or materials.

10. The instant record is devoid of any showing that Respondent advised Complainant on the third day of the project (the day after the light rain) that additional ABC and grading was required before the asphalt could be placed. On the contrary, despite the rainfall Respondent proceeded to complete the project without any additional ABC or grading work. Respondent should have halted the project if it believed that the ABC sub-base was unfit to receive the new asphalt placement. A contractor should refuse to perform construction work that is reasonably calculated to result in substandard workmanship.

11. Respondent is found to have effectively accepted all of the conditions on the third day as being adequate to support a workmanlike result and, as such, is properly estopped to claim that there was rain damage to the ABC which caused its work to fail. Under all of the facts and circumstances presented herein, the purported “waiver”/disclaimer is found not to relieve Respondent of the responsibility for the above-described deficiencies in its asphalt work.

12. A jobsite inspection by the appointed inspector for the Registrar of Contractors was held, pursuant to which that Agency sent Respondent a letter directing it to accomplish specified remedial work within a stated period of time. The following facts were adduced at the hearing regarding the aforementioned Agency directive and same are important to note:

a. The directive was issued on February 29, 2000 and gave Respondent fifteen (15) days to complete the required repairs. b. Evidence of record demonstrated that as of March 15, 2000, Complainant had not received a response from Respondent referable to the aforementioned Agency directive. Nevertheless, on March 16, 2000, Respondent made contact with Complainant regarding performing the corrective work and shortly thereafter, Complainant received a letter in this regard. In the letter Respondent expressed a willingness to complete the required remedial work and, among other things, offered to apply a seal- coat to the asphalt. c. On or about March 24, 2000 a tile contractor was sent by Respondent to correct the broken tile and he replaced the broken white tiles only. The tile that said tile contractor brought out to replace the tan/gray tiles failed to provide an adequate match to the existing tiles and thus, Complainant refused to allow these replacement tiles to be installed. Ultimately, Complainant located a specified black tile to use as a contrasting border, but the installation of these tiles has never been completed. It should be noted that Respondent offered a contract credit for the broken tiles that were not replaced but Complainant has not found said credit to be adequate. d. On or about March 28, 2000 Complainant sent a letter to Respondent, rejecting the offered seal coat procedure and basically electing to allow the matter to go to an administrative hearing for a resolution. e. Respondent testified that it had planned to complete all of the required repairs at the time of the seal-coat procedure and, based on Complainant’s rejection of the seal-coat procedure, none of the other items were corrected.

13. Evidence of record demonstrated that the Registrar of Contractors has a long-standing policy of not telling a contractor how to correct a construction deficiency but merely to advise the parties as to what items need correction. In light of the fact that Respondent tendered, albeit belatedly, corrective work in response to the Agency directive, the facts and circumstances presented herein militate against a finding that Respondent violated the charged provision of the State’s Contracting laws regarding a failure to take appropriate action following receipt of an Agency directive.

14. Notwithstanding the above-described denial of access, it is not determined that Complainant has waived any right to have necessary and appropriate corrective work performed by Respondent on the existing deficiencies determined herein.

15. Complainant has only paid Respondent a portion of the original contract amount and refuses to pay for any claimed “extras” submitted by Respondent in its billing invoices for the project. Complainant contends that it never approved the “extras” submitted by Respondent. There was no showing that Respondent has instituted any legal proceedings or lien action to attempt to receive payment for the remaining sum due on the original contract and/or the claimed “extras.”

16. Complainant claims specified “back-charges” for the damaged sign and the broken water line. Thus, a contract and/or money dispute exists between the parties. The Registrar of Contractors, acting through an administrative license disciplinary hearing, is the inappropriate forum to resolve such money/contract issues. Therefore, if the parties cannot resolve this aspect of their dispute then they will need to bring same before a civil court of competent jurisdiction.

17. As set forth in the Citation and Complaint issued by the Registrar of Contractors, Respondent was advised that in the event of a finding of a violation against Respondent, Respondent’s prior disciplinary record of final Registrar of Contractors’ orders may be considered in mitigation or aggravation. Accordingly, subsequent to conclusion of the instant hearing, notice was taken of official records of the Registrar of Contractors regarding any prior final disciplinary orders against Respondent and said notice revealed that the instant complaint was the only complaint on the Registrar of Contractors’ current record regarding Respondent. Therefore, Respondent’s prior record is properly deemed to be excellent and thus, is viewed as a matter in mitigation for any disciplinary penalties to be imposed as a direct result of this case.

CONCLUSIONS OF LAW

1. Respondent violated the provisions of A.R.S. § 32-1154A (7), and (3); namely Rule R 4-9-108.

RECOMMENDED ORDER

In view of the foregoing it is recommended, commencing on the effective date of the Order entered in this matter, that the Class C-13 license of Respondent shall be suspended until the Registrar of Contractors receives written proof that Respondent has accomplished appropriate and effective remedial work on the items set forth in Findings of Fact 4(a) through 4(e). Any unreasonable denial of access by Complainant, which prevents Respondent from performing the ordered corrective work, shall be deemed to be tantamount to Respondent’s compliance with the Order entered in this matter. It is further recommended that if Respondent accomplishes the above- described corrective work or is denied access to perform the corrective work on or before the effective date of the Order entered in this matter, then the aforementioned license suspension shall not take place and in that event this Citation, together with the Complaint upon which it is based, shall be closed.

Done this day, November 7, 2000

______________________________________ Mark A. Silver Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2000, to:

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

By ___________________________

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