ALJDEC

00F-M0823-ROC · Registrar of Contractors · 2000-05-15

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 5, 2000 at 9:00 a.m. APPEARANCES: Complainants appeared on their own behalf; Respondent appeared through her attorney, Emilia Banuelos, Esq. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

The parties presented evidence and testimony with respect to the issue of whether Respondent’s application of stucco to an addition to Complainants’ residence complied with applicable minimum workmanship standards. Based upon the entire record, the undersigned makes the following Findings of Fact, Conclusions of Law and Recommended Order. FINDINGS OF FACT Background The Registrar of Contractors issued License No. 100757, Class C-36, to Respondent, an individual, on February 7, 1994. Complainant Jane Reynolds is a mechanical engineer. Before overseeing construction of the addition at issue, Mrs. Reynolds had overseen numerous construction projects to renovate substantially or enlarge other residences. Mrs. Reynolds drew the plans for an addition to her residence, which consisted of 676 square feet of living space (including two bedrooms and a bath), a new 235-square-foot enclosed porch, and enclosure of a previously existing 219-square-foot porch. The plans that Mrs. Reynolds prepared required that, for the enclosed porch on the south side of the addition, “Brown Board [was] to be used on Porch walls towards new [bedrooms].” Mrs. Reynolds included this requirement in the plans because the City of Chandler requires it in its code. Although Mrs. Reynolds does not know what “brown board” is, she does not believe it consists of or can be covered with stucco. Sometime in the summer of 1999, Steve Scarcello, the qualifying party of York Building Contractors, Inc., License No. 110220, Class B- (“York”), submitted a proposal to Complainants to perform substantial construction of the addition that Mrs. Reynolds had designed, including to “[s]tucco exterior walls to match existing,” for $27,000. Although Complainants and York never signed a contract, Complainants accepted York’s proposal and it commenced construction of the addition. York contracted with Respondent for her to perform the exterior stucco work on the addition. Respondent’s crew started applying stucco to the addition. At the end of October 1999, Complainants saw Respondent’s crew installing foam board and lath on the enclosed porch. Because the plans called for “brown board,” not stucco, Complainants called York’s qualifying party Mr. Scarcello to complain, but he did not come out to stop Respondent’s crew. Respondent later applied stucco to the lath on the enclosed porch. Complaint against York A dispute developed between York and Complainants about many aspects of its construction of the addition. The most significant was that York had constructed a flat roof over the addition, even though Mrs. Reynolds’ plans required a tiled roof having a 5”/12” pitch and the Complainants’ homeowners’ association had approved a pitched, tile roof. In addition, because York did not allow enough clearance between a beehive fireplace and an electrical panel, the fireplace, including the stucco on the exterior wall, had to be redone several times. York quit or was fired on October 20, 1999. On November 2, 1999, Complainants made a complaint to the Registrar against York’s license, which was designated Case No. M00-0633, primarily for various allegedly unauthorized departures from the plans Mrs. Reynolds had drawn, including the absence of pitch or tile on the addition’s roof and the absence of “brown board” on the enclosed porch. York did not resolve the complaints in Case No. M00-0633 to Complainants’ satisfaction and they requested a hearing, which was assigned to the Office of Administrative Hearings. Neither Complainants, York, nor Respondent requested that these matters be consolidated. On May 2, 2000, a hearing in Case No. M00-0633 (designated No. 00F-M0633-ROC in the Office of Administrative Hearings) was held before Administrative Law Judge Dorinda M. Lang. At the time of the hearing in this matter, the Registrar had not rendered a final decision in Case No. M00-0633. Completion of the Addition After York quit or was fired, Complainants made a contract with R and E Springfield Homes, License No. 146863, Class KB-02 (“Springfield”), to correct York’s departures from the Mrs. Reynolds’ plans, including modifying the flat roof on the addition to one that was pitched and tiled.

Complainants paid Springfield $850 for the stucco portion of the contract. Because Complainants were satisfied with the overall quality of Respondent’s stucco work and her crew’s ability to match the existing texture on the original residence, Springfield contracted with Respondent to apply stucco to the gables that would be constructed when the addition’s roof was modified. Springfield paid Respondent $250 for the additional stucco work. After Springfield modified the roof by adding pitch, tile, and gables, Respondent’s crew applied stucco to the north and south gables. Various problems in construction of the addition had caused Complainants to postpone closing for the permanent loan at least twice, which had resulted in substantially higher closing costs and interest rate. By the time Springfield took over construction, Complainants wanted to finish the addition as quickly as possible. During completion of its contract with Springfield, Respondent’s supervisor Roy Banuelos noticed that the north gable was bowed. He pointed this out to Springfield, but was instructed him to keep adding mud to the north gable to obscure the bow. Respondent’s usual practice is to require that the property owner or general contractor sign a disclaimer and waiver before her crew will apply stucco to an inadequate surface. On this job, however, Mr. Banuelos did not obtain a waiver. Complaint against Respondent On December 9, 1999, Complainants made a complaint to the Registrar against Respondent’s license, alleging that the stucco work was unfinished and of poor quality in certain areas. On behalf of the Registrar, Inspector Ron Lamp performed a jobsite inspection and, on January 3, 2000, issued the following directive to Respondent: CONTRACTOR TO TAKE ANY NECESSARY ACTION TO:

1. PROPERLY REPAIR STUCCO PATCH ON EAST SIDE OF HOUSE BY GABLE. 2. PROPERLY REPAIR STUCCO BY DOOR ENTRY, ELECTRIC SWITCHES, AND FRENCH DOORS. NOTE: THE TRIM AND FINISH ARE RESPONSIBILITY OF OTHERS. 3. NO ACTION OF STUCCO HOLES ON NORTH SIDE. 4. NO ACTION ON EAST SIDE STUCCO PATCH. 5. NO ACTION ON GLASS BLOCK STUCCO PATCH.

On January 18, 2000, Inspector Lamp received a letter from Mrs. Reynolds, which informed him that Respondent’s crew had performed corrective action within 15 days of the directive, but that she was not satisfied with the appearance of Respondent’s repairs. In addition, Complainant complained about the trim on the doorways and that “[it was] ridiculous that the West gable and patch jobs are allowed to remain as they are.” The Registrar treated this letter as a request for hearing. On January 28, 2000, the Registrar issued a Citation and Complainant against Respondent’s license, charging her with violations of A.R.S. § 32- 1154.A.7, .23, and .3. Respondent timely answered the Citation and Complainant, denying that she had violated any contracting law and alleging that she had fully performed her contracts with York and Springfield (or Eagle Creek Homes, which appears to be the name Springfield used on the contract with Complainants). The case was assigned to the Office of Administrative Hearings and a hearing was scheduled and held in due course. Additional Evidence Presented at the Hearing Inspector Lamp testified at the hearing that he did not direct Respondent to correct the holes around the outside electrical outlet near the fireplace because he thought the electrician, not Respondent, had made these holes (Item #3 on the January 3, 2000 directive). Respondent at the hearing agreed to fix the holes around the electrical outlet, even if they were caused by another subcontractor. Inspector Lamp did not direct Respondent to correct the remaining two items because, in his opinion, the workmanship on these items complied with applicable minimum standards. Inspector Lamp conducted a prehearing jobsite inspection on April 27, 2000. In his opinion, Respondent had fully complied with the January 3, 2000 directive in a professional and workmanlike manner. Complainants offered into evidence photographs of the stucco repairs that Respondent’s crew had made to the areas around the French doors and patio door on the enclosed porch after Inspector Lamp issued the January 3, 2000 directive. Although the stucco is unpainted, its texture appears to match that of the surrounding area. Complainants also offered into evidence photographs of stucco surrounding a glass block window, which did not appear unsightly. Complainants testified that, although Respondent had not applied the stucco, one of its supervisors, whose name Complainants did not know but who was not Mr. Banuelos, had promised to “feather” the finish around the window. Neither Inspector Lamp, Respondent, nor Mr. Banuelos had ever heard of “brown board.” The North Gable and Complainants’ Complaint against Springfield Inspector Lamp testified that he did not inspect the north gable at the original jobsite inspection or direct Respondent to correct it because Complainants did not call it to his attention. Complainants dispute this. On March 22, 2000, the Registrar received Complainants’ complaint against Springfield, which was designated Case No. M00-1271 and assigned to Inspector Lamp to investigate. Complainants complained about the north gable in their formal complaint against Springfield. Inspector Lamp performed an initial jobsite inspection of Complainants’ complaints against Springfield in Case No. M00-1271 at the same time he performed the prehearing jobsite inspection in this case. Inspector Lamp testified that the stucco application on the north gable appeared to comply with all applicable minimum standards. However, in Inspector Lamp’s opinion, the underlying framing that Springfield had constructed was bowed. Inspector Lamp directed Springfield to correct this deficiency. In Inspector Lamp’s opinion, Respondent should not have applied stucco over bowed framing. Complainants also offered into evidence photographs of the north gable. The texture of the stucco is not unsightly. Complainants finally testified that, overall, they are satisfied with the quality of Respondent’s stucco work and that they would like to hire Respondent to perform additional work on the residence. Mitigation 42. The Citation and Complaint issued by the Registrar advised Respondent that, if she were found in violation of any contracting law, her prior disciplinary record of final Registrar of Contractors’ orders might be considered in mitigation or aggravation. Accordingly, notice is taken of official records of the Registrar of Contractors, which reveal that only one other complaint has been made and no final orders have been entered against Respondent on the Registrar’s current record. Therefore, Respondent’s prior record is deemed to be excellent andis viewed as a matter in mitigation. CONCLUSIONS OF LAW In this administrative proceeding, Complainants bear the burden of proof and must establish statutory violations by a preponderance of the evidence.[1] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[2] A preponderance of the evidence is “evidence which is of greater weight or more convincing than evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.”[3] Complainants have not established that Respondent violated A.R.S. § 32- 1154.A.3,[4] .7,[5] or .23[6] with respect to any of the items of complaint that Inspector Lamp inspected at his initial jobsite inspection. Complainants also have not established any statutory violation with respect to Respondent’s application of stucco to the enclosed porch. When Mrs. Reynolds undertook to act as her own general contractor, she assumed responsibility for supervising specialty subcontractors like Respondent and, if necessary, clarifying their understanding of the plans and their contractual responsibilities. By acting as her own general contractor, Mrs. Reynolds also assumed the risk of including in her plans a term that she herself did not know the meaning of. Finally, the record does not show what “brown board” is or that it was not meant to be or was not actually installed under the exterior stucco.[7] The evidence shows that the entire north gable at the time of the hearing did not comply with applicable standards of professionalism and good workmanship; the contractors responsible for the appearance of the gable therefore were in violation of A.R.S. § 32-1154.A.3 and .7. But Springfield is not a party to this administrative proceeding and cannot be bound by its result.[8] When the Registrar allocates responsibility between lay homeowners and professional contractors, normally, a contractor who accepts a surface by constructing her own work on it warrants that the surface is adequate to support the construction. In this case, however, the pendency of Complainants’ complaint against Springfield with respect to the north gable, the pressure that Springfield and Complainants brought to bear on Respondent to complete the addition quickly, the small amount that Respondent received for the stucco work compared to Springfield’s profits, and Respondent’s forthrightness at the hearing render holding Respondent solely responsible for correcting the underlying framing on the north gable unjust and inequitable. RECOMMENDED ORDER In view of the foregoing, it is recommended that the Registrar dismiss Case No. M00-0823 against Respondent’s License No. 100757, Class C- 36. It is further recommended that Complainants be allowed to make another complaint against Respondent’s license to the Registrar if (1) Respondent fails to keep the promise she made at the hearing to patch the stucco around the outlet near the beehive fireplace in a professional and workmanlike manner or (2) Springfield corrects or Complainants arrange at their own expense for another appropriately licensed contractor to correct the framing on the north gable, and Respondent fails to restucco it in a professional and workmanlike manner, at her own expense. Done this day, May 15, 2000.

______________________________________ Diane Mihalsky Administrative Law Judge

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

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

By ___________________________

----------------------- [1] See A.A.C. R2-19-119; see also Culpepper v. State, 187 Ariz. 431, 438, 930 P.2d 508, 515 (App. 1996).

[2] Morris K. Udall, Arizona Law of Evidence § 5 (1960).

[3] Black’s Law Dictionary at page 1064 (6th ed. 1990).

[4] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[v]iolation of any rule adopted by the registrar.” The rule violated here was A.A.C. R4-9-108, which requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.”

[5] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[t]he doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured.”

[6] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving written directive from the registrar.”

[7] The fact that the City of Chandler apparently requires it to be installed in bedrooms indicates that it may be a fire wall or retardant that is installed next to the framing, underneath stucco or whatever other exterior finish is used.

[8] See, e.g., Scottsdale Memorial Health Systems, Inc. v. Clark, 157 Ariz. 461, 466, 759 P.2d 607, 612 (1988).

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