ALJDEC

01F-2725-ROC · Registrar of Contractors · 2002-03-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: February 1, 2002 APPEARANCES: Complainant Sheila Prince appeared on her own behalf. Thomas Baker, Esq. represented Respondent James Peter Adams, dba Column Construction Company. ADMINISTRATIVE LAW JUDGE: Daniel G. Martin _____________________________________________________________________

The question presented by this matter is whether James Peter Adams, doing business as Column Construction Company, is subject to discipline for acts or omissions in violation of A.R.S. § 32-1154(A). Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order: FINDINGS OF FACT James Peter Adams, doing business as Column Construction Company (“Column”), is the holder of a Class B license (No. 140355) issued by the Registrar of Contractors (“ROC”). The ROC’s official records demonstrate that Column’s Class B license was suspended by operation of law between December 1, 2000 and February 8, 2001 for lack of bond (12/1/00-12/21/00) and for non-renewal (12/1/00- 2/8/01). On February 8, 2001, Column renewed its Class B license. On May 17, 2001, Column, which held both a general residential license and a general commercial license, canceled its Class B license as well as its commercial license, and obtained a KB (dual building contractor) license as a limited liability company. On October 21, 2000, Column entered into a written contract (the “Contract”) [Exhibit B] with Complainant Sheila Prince to perform remodeling work on two bathrooms at Ms. Prince’s home in Scottsdale, Arizona. The Contract price was $4,809.00. The parties agreed that Column would commence work (tear-out) on November 20, 2000. Based on Finding of Fact No. 2, the Administrative Law Judge finds that Column was properly licensed at the time it entered into the Contract. Ms. Prince had performed the design work for the bathroom remodels herself at Home Base. The weight of the credible evidence demonstrated that Ms. Prince provided Column with a copy of the design drawings prior to Column commencing work. The agreement between the parties contemplated that Ms. Prince would provide all materials (purchased through Home Base), and that Column would install those materials at Ms. Prince’s home. On October 21, 2000, Ms. Prince paid Column a down-payment in the amount of $500.00 in accordance with the terms of the Contract. Column commenced the tear-out work at Ms. Prince’s home as scheduled on November 20, 2000. That day, Ms. Prince paid Column $1,000.00 in accordance with the terms of the Contract. The weight of the credible evidence demonstrated that a Scottsdale building permit was required for Column’s work at Ms. Prince’s home, and that no such permit was obtained. The parties disagreed as to which one of them bore responsibility to obtain the permit. The Contract, which Column prepared, is silent on this issue. The Administrative Law Judge finds, on the weight of the credible evidence, that Column, as the contractor, bore responsibility to obtain the permit, and that it failed to do so.[1] In making the foregoing finding, the Administrative Law Judge expressly disagrees with Exhibit H, an e-mail offered into evidence by Column in support of its contention that Ms. Prince was obligated to obtain the building permit. The author of the e-mail, Dave Potter, a Scottsdale building official who expressed the view that Ms. Prince was obligated to obtain the building permit, did not testify at hearing, and consequently the Administrative Law Judge gave this hearsay evidence very modest evidentiary weight. On November 24, 2000, Ms. Prince paid Column $845.64 pursuant to invoice number 20211. On November 25, 2000, the parties executed Change Order No. 1 to the Contract. [Exhibit E] This change order increased the Contract price to $6,433.00. The scope of Column’s work at Ms. Prince’s home included both electrical and plumbing work. Column hired a licensed plumber (ABC Plumbing) to perform some of the plumbing work (relocation of a shower drain). However, Column performed some of the plumbing work, and all of the electrical work, itself. The Administrative Law Judge finds that in so doing, Column performed contracting work outside the scope of its Class B license. At hearing, Column claimed that the City of Scottsdale had advised it that an electrical license was not required for the work that Column performed (moving several electrical outlets and replacing them with GFI outlets, and adding a new GFI outlet). The Administrative Law Judge finds that to the extent the City of Scottsdale may have advised Column in this regard, its advice was incorrect and Column unreasonably relied on that advice. The proper authority for advice on licensing matters in this State is the ROC, and Column did not consult the ROC on this issue. The weight of the credible evidence demonstrated that Column represented to Ms. Prince that it could complete the remodel prior to the Christmas holidays. Column did not meet this deadline, but its inability to do so is attributable, in large part, to changes that Ms. Prince elected to make in the designs of her bathrooms during the construction process. On December 18, 2000, the parties executed Change Order No. 2 to the Contract. [Exhibit I] This change order, which was typewritten, increased the Contract price to $6,873.00. There was considerable dispute between the parties regarding Exhibit A, a copy of Change Order No. 2 that Column offered into evidence. The dispute concerned a series of handwritten additions to the change order. The Administrative Law Judge finds that Column made these additions after Ms. Prince had signed Change Order No. 2, and that they therefore did not become a part of the Contract. The Administrative Law Judge considered the notations, however, in conjunction with Mr. Adams’ testimony, as evidence of work that Column performed. On January 15, 2001, as Column’s work progressed, Ms. Prince paid Column an additional $2,931.75 in connection with invoice number 20220. On February 2, 2001, Ms. Prince paid Column $701.10 for invoice number 20227. The quality of Column’s workmanship at Ms. Prince’s home was, in general, very good. In several instances, however, Column’s workmanship did not meet the ROC’s minimum workmanship standards applicable to licensed contractors in this State. The Administrative Law Judge addresses each of these items in turn. In the course of the remodel, Ms. Prince replaced all of her bathroom cabinetry. For her master bathroom, Ms. Prince purchased a sink cabinet that was “right handed,” i.e., two cabinet doors were located on the left side of the cabinet, and two columns of drawers were located on the right side of the cabinet. For her hall bathroom, Ms. Prince purchased a sink cabinet that was centered, i.e., the cabinet doors were located in the middle, and the cabinet drawers were located on the left and right sides. Ms. Prince developed different designs for the hall and master bathroom cabinets so that the sinks in those bathrooms would be centered, as is usual and customary, over the cabinet doors. Column installed the hall bathroom cabinets in the master bathroom, with the result that the master bathroom sink is centered not over both cabinet doors as Ms. Prince designed, but instead is centered over one of the cabinet doors and one of the drawer columns. This installation rendered the top drawer in that column inoperable. At hearing, Column asserted that Ms. Prince inspected the master bathroom cabinets and approved them prior to installation of the vanity top. The Administrative Law Judge finds that even if Column is correct in this assertion, it had not yet installed the cabinet doors and drawers as of this time, and that Ms. Prince was therefore not aware of the mistake. Column should have apprised Ms. Prince that the sink did not center over the cabinet doors prior to completing the installation of the cabinet. Ms. Prince is willing to accept, as a remedy for the incorrect installation of the master bathroom cabinet, removal of the drawer fronts below the sink and the replacement of those drawer fronts with a cabinet door to match the cabinet doors already installed. The medicine cabinet that Ms. Prince selected for installation in her master bathroom contained a mirrored interior. Ms. Prince wanted to have an electrical outlet located inside that medicine cabinet. Column agreed to install the outlet. When Column cut the hole for the electrical outlet in the mirrored interior, it caused a small crack in the interior mirror’s surface. Column offered to replace the mirror and re-cut the hole, but told Ms. Prince that it would charge her for that work and that it would not take responsibility if in doing the work it caused another crack. The Administrative Law Judge finds that Column agreed to work on the mirrored interior surface, and in so doing accepted responsibility to perform that work in a proper and workmanlike manner. When Column caused the crack in the interior surface, its obligation was to properly repair or replace that surface. Additional to the crack in the medicine cabinet’s interior, Column chipped the corner of the medicine cabinet door. Column claimed to have repaired this damage, but the Administrative Law Judge finds, on the weight of the credible evidence, that it did not do so. Column installed a diverter in Ms. Prince’s master bathroom shower that improperly reversed the hot and cold water lines. Column ultimately rectified this problem, but improperly attempted to charge Ms. Prince for the repair. Because Column was responsible for the improper installation, Column also was responsible for the cost to correct that installation. Column damaged the enamel in Ms. Prince’s bathtub during the tear-out process. Although such incidents are not unusual during a remodeling project, and Column ultimately repaired the damage, Column improperly attempted to charge Ms. Prince for the cost of that repair. Column slightly damaged the interior surface of one the master bathroom cabinet drawers. That damage has not been repaired. Column improperly installed an electrical outlet in the master bathroom. The outlet was set too low. At hearing, Column urged that Ms. Prince had caused the problem by selecting a back splash that was two to four inches higher than a standard back splash. The evidence corroborated Column’s statement that Ms. Prince had selected a higher than normal back splash. However, the Administrative Law Judge finds, on the weight of the credible evidence, that Column was aware of the height of that back splash prior to installing the outlet, and therefore should have caused the outlet to be set higher on the wall.[2] Column eventually re-set the outlet, but thereafter attempted to improperly charge Ms. Prince for that work. The subcontractor that Column selected to install Ms. Prince’s mirrors improperly measured, with the result that the mirrors had to be removed and replaced. (The improper placement of the electrical outlet was a further contributing factor in the need to replace the mirrors.) Column improperly charged Ms. Prince for time that Mr. Adams spent supervising the second installation. General contractors such as Column are responsible for the work of their subcontractors, and must bear the burden of mistakes made by those subcontractors. On February 5, 2001, Column presented an invoice to Ms. Prince for $2,576.00. Although Ms. Prince had paid each of Column’s previous invoices, she began to question Column’s charges, and when she did not receive satisfactory answers from Column, she refused to pay further. Thereafter, the relationship between the parties quickly deteriorated. Column continued to submit additional invoices to Ms. Prince, none of which were paid. The Administrative Law Judge does not address further the financial dispute between the parties. Both parties presented evidence as to Column’s invoices and the amounts they claim are due on, or should be deducted from, the Contract price. The Administrative Law Judge finds that the ROC is not the appropriate forum in which to determine whether a balance is due on the Contract. Nothing herein should be construed, however, as preventing either party from seeking damages against the other in an appropriate forum. On May 18, 2001, Ms. Prince filed a complaint against Column with the ROC. In that complaint, Ms. Prince alleged “1) contract signed with invalid [license] B-140355 2) Unlicensed for [electrical/plumbing] 3) Billing at higher [hourly] rate than agreed 4) Refuses to explain $917 markup on [estimate] 5) refuses to explain HB $829 on [estimate] 6) wrong cabinet installed in [master] bath 7) Damage to med. cabinet and drawer not rectified”. ROC Inspector Leslie “Bud” Combs investigated Ms. Prince’s complaint. On June 4, 2001, Inspector Combs conducted a jobsite inspection at Ms. Prince’s home. On June 29, 2001, Inspector Combs issued a Corrective Work Order (“CWO”) under which the ROC gave Column 15 days to complete the following work (complaint numbers, with the exception of #8, correlate to Ms. Prince’s complaint): |Complaint #2. | |Contractor not licensed for | | | |electrical/plumbing: | |• | |Contractor subcontracted plumbing and did| | | |electrical himself ( contractor to | | | |correct by appropriate means and properly| | | |licensed electrician to ensure code | | | |compliance | | | | | |Complaint #6. | |Wrong cabinet installed in master bath: | |• | |Contractor installed incorrectly “Handed”| | | |cabinet ( contractor to correct by | | | |appropriate means | | | | | |Complaint #7. | |Contractor damaged medicine cabinet door | | | |and mirror: | |• | |Contractor to correct by appropriate | | | |means | | | | | |Complaint #8. | |Contractor bid work without building | | | |permit: | |• | |Contractor to obtain permit and | | | |inspections and comply with any | | | |corrections needed |

Column did not perform any of the corrective work identified in the CWO. Column defended its failure to have performed any of the corrective work identified in the CWO based on the assertion that its obligations under the Contract terminated when Ms. Prince ceased making payments. The Administrative Law Judge finds that Column’s proffered defense does not establish a valid justification for its failure to have complied with the CWO. Each of the items identified for corrective work in the CWO tie to work performed or omissions committed by Column during a period that the Contract was indisputably in force. Therefore, Column was obligated to comply with the ROC’s written directive. On September 11, 2001, the ROC issued a Citation and Complaint charging Column with violations of A.R.S. § 32-1154(A)(2) (departure from or disregard of plans, specifications or local building codes), (A)(7) (wrongful or fraudulent act resulting in substantial injury), (A)(9) (failure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract), (A)(17) (knowingly contracting beyond the scope of the license or licenses of the licensee), (A)(23) (failure to take appropriate corrective action in response to a written directive from the ROC) and (A)(3) (violation of any rule adopted by the ROC, in this case, Arizona Administrative Code (“A.A.C.”) Rule R4-9-108 covering workmanship standards). CONCLUSIONS OF LAW In this proceeding, Ms. Prince bears the burden to prove, by a preponderance of the evidence, that Column is subject to discipline for violations of A.R.S. § 32-1154(A)(2), (A)(3), (A)(7), (A)(9), (A)(17) and/or (A)(23) as charged by the ROC in its September 11, 2001 Citation and Complaint. See A.A.C. R2-19-119. 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 § 5 (1960). The Administrative Law Judge finds that Ms. Prince met her burden of proof as to all but one of the ROC’s charges, as set forth below. The evidence demonstrated that Column’s conduct in this matter violated A.R.S. § 32-1154(A)(2), (A)(3), (A)(7), (A)(17) and (A)(23). Ms. Prince failed to establish, however, that Column violated A.R.S. § 32- 1154(A)(9). Although the parties remain in dispute as to whether a balance is due on the Contract, Column did complete the scope of work set out in the Contract. Based on the foregoing, it is appropriate for the ROC to impose discipline against Column’s license. The ROC’s September 11, 2001 Citation and Complaint advised Column that in the event of a finding of a violation against it, Column’s prior disciplinary record of final ROC orders could be considered in mitigation or aggravation. Accordingly, subsequent to the conclusion of the instant hearing, the Administrative Law Judge took notice of prior final disciplinary orders against Column in the ROC’s official records. Those records revealed that Column has not been the subject of any final ROC disciplinary orders within the past two years. The Administrative Law Judge considered this disciplinary record as a mitigating factor when determining the extent of appropriate recommended discipline, if any, for this matter. Even though Column’s Class B license has been canceled, the ROC retains jurisdiction to impose discipline against that license. See A.R.S. § 32-1154(C). Upon consideration of all of the facts and circumstances presented by this case, the Administrative Law Judge concludes that the ROC should revoke Column’s Class B license subject to the condition that Column can avoid such revocation by fully complying with the CWO and completing the other requirements set forth below in the Recommended Order. Given the scope of the recommended remedial measures, the Administrative Law Judge concludes that Column should be given additional time to complete the required work. If Column fails to undertake the remedial measures set forth in the Order entered in this matter, and the ROC takes discipline against Column’s Class B license, then further appropriate action should be taken against Column’s Class KB license and persons named on that license pursuant to A.R.S. § 32-1154(A)(21). RECOMMENDED ORDER The Administrative Law Judge makes the following Recommended Order: Commencing thirty (30) days after the effective date of the Order entered in this matter, Column’s Class B license (No. 140355) shall be revoked. The foregoing revocation shall not take place, and this matter shall be closed, if, within fifteen (15) days after the effective date of the Order entered in this matter, the ROC receives written proof that Column, at its sole expense and in a proper and workmanlike manner, has: (i) obtained all necessary permits and inspections from the City of Scottsdale and has complied with any corrective work required by the City of Scottsdale pursuant to those inspections; (ii) caused a properly licensed electrician to ensure that the electrical work performed by Column at Ms. Prince’s residence meets all applicable electrical codes, and has caused to be corrected any deficiencies identified by such electrician; (iii) caused a properly licensed plumber to ensure that the plumbing work performed by Column at Ms. Prince’s residence meets all applicable plumbing codes, and has caused to be corrected any deficiencies identified by such plumber; (iv) corrected the improper installation of the master bathroom cabinet (see Findings of Fact Nos. 23, 24 and 25); (v) corrected the crack in the master bathroom medicine cabinet and the chip in the master bathroom medicine cabinet door; and (vi) corrected the damage to the master bathroom cabinet drawer.

Done this day, March 1, 2002.

______________________________________ Daniel G. Martin Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2002, to:

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

By ___________________________ ----------------------- [1] Even if Column was correct, as it attempted to argue at hearing, that Ms. Prince was responsible for obtaining the permit, Column should not in any event have commenced and continued any construction work until that permit had been issued.

[2] The Administrative Law Judge does not mean to imply that Column itself should have installed the outlet ( this work should have been performed by a properly licensed electrician.

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