ALJDEC

01F-A012016(1)-BFS · Department of Building and Fire Safety · 2002-02-13

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 25, 2002. APPEARANCES: Daniel King and Anita Connelly appeared on their own behalf. Respondent CAVCO industries was represented by Mike Edwards. Respondent Statewide Homes was represented by Gail Ledward, Esq. Respondent Arizona Land Homes and Design failed to appear. ADMINISTRATIVE LAW JUDGE: Gregory L. Hanchett _____________________________________________________________________ In this matter, Complainants King and Connelly appeal the determination of the Department of Building and Fire Safety that items numbers 15, 16, and 43 be “not verified.” Based on the evidence adduced at the hearing, the following findings of fact, conclusions of law, and recommended decision are made. / / /

FINDINGS OF FACT 1. Complainants entered into a contract with Oakland Homes, a now defunct retailer of CAVCO mobile homes, for the purchase of a CAVCO mobile home. The contract, entered into on October 4, with an addendum made between the parties and incorporated into the contract on October 5, 2000 (admitted into evidence in this hearing as Exhibit #1), provided that, among other things, a foundation consisting of both block stem and “strip footers” would be included in the purchase price. The base purchase price of the home was $38,745.00. The options, which clearly included the block stem and strip footers, cost an additional $14,720.00. The sum of these two amounts added together was $53,465.00. The contract clearly shows on the front that this sum, $53,465.00, is the price of the home being purchased. This evidence establishes that Complainant’s contract with Oakland contemplated the inclusion of strip footers in the $53,465.00 purchase price. That purchase price provided the requisite consideration for the placement of the strip footers. 2. The same amended contract also clearly shows that Complainants and Oakland contemplated the inclusion of ceiling fan outlets in the living room and master bedroom as part of the consideration in the full purchase price of $53,640.00. 3. The contract was negotiated by Steven Post on behalf of Oakland Homes. 4. Apparently Oakland Homes was having financial difficulty and was unable to complete many of its agreements with customers. Sometime in late December, 2000, or early January, 2001, Respondent Statewide Homes purchased from CAVCO Homes all of Oakland’s inventory then on order with CAVCO. The inventory included Complainants’ home which was being manufactured by CAVCO. 5. Salesperson Post was hired by Statewide to continue on as a salesperson. Post continued to work with Complainants as he had while he was employed by Oakland Homes. According to Complainant King’s testimony, he primarily dealt with Steve Post at Statewide. King also testified that he was under the impression at all times during the transaction that the strip footers were included in the purchase price of $53, 465.00. He further stated that Post had indicated that Statewide would take Oakland’s contract with Complainants and fulfill that contract. 6. Post renegotiated a contract on behalf of Statewide with Complainants. That contract, admitted as Exhibit G, dated January 5, 2001, includes the purchase earlier agreed upon between Oakland and Complainants, $53,465.00, the price that had included the placement of the strip footers and living room and master bedroom ceiling fan outlets. Complainants’ testimony demonstrates that they and Post understood that the $53,460.00 price contained in the January 5, 2001 contract included the price of the strip footers and the ceiling fan outlets in the living room and master bedroom. Further support for Complainants’ contention is found in the fact that the $53,460.00 purchase price exceeds Statewide’s cost for the home by $10,008.00. As Complainant Connelly succinctly pointed out, the $53,460.00 purchase price cannot be explained unless one concludes that the parties intended the price to include the strip footers and the living room and master bedroom ceiling fan outlets. 7. The contract also indicates that “All terms of the sale are expressed on the purchase agreement.” This language, however, does not contradict Complainants’ contention that contained within the term of the purchase price of the mobile home was the consideration for the placement of the footers and additional ceiling fan outlets. Complainants’ contention with regard to the inclusion of the strip footers and additional ceiling fan outlets does not vary or contradict any language of the contract. 8. Yet another contract was entered into by Complainants and Statewide on March 21, 2001. This contract , too, was negotiated between Complainants and Stephen Post on behalf of Statewide. This contract again provided that the purchase price of the home was $53,460.00, the same price that included the cost for the placement of the strip footers and the living room and master bedroom ceiling fan outlets. 9. The mobile home was delivered and set up on Complainants’ lot in May, 2001. According to Complainant King’s testimony, At that point, he was informed for the first time that there might be an issue with respect to installation of the footers. This information came to him from the installer who told King about the situation immediately before the home was installed. King was on his way out of town when given this information. King told the installer at that time that the strip footers had always been a part of the deal. According to King, the installer told him that he would take care of it. At that point, King left . King further testified that he did not become aware that the strip footers had not been installed until after the home had been set. Upon learning of the failure to install the strip footers, the instant complaint was filed which resulted in this appeal. 10. The undersigned finds the testimony of Complainants King and Connelly to be credible. Their testimony, along with the inescapable inferences from the consistent use of the $53,460.00 purchase price in the agreements demonstrates that the persons who negotiated this contract, Complainants on their own behalf and Stephen Post on behalf of Respondent Statewide, intended that the $53,460.00 price include the cost of the strip footers and the ceiling fan outlets. 11. Complainants’ allegations do not extend to conduct on the part of either Respondent CAVCO or Respondent Arizona Land Home and Designs. Rather Complainants’ contention with respect to items 15, 16, and 43 extend solely to conduct on the part of Respondent Statewide. CONCLUSIONS OF LAW 1. The Complainants have the burden of proof, and the standard of proof on all issues is by a preponderance of the evidence. Culpepper v. State, 187 Ariz. 431, 930 P.2d 508 (App. 1996). 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). It "is evidence which is of greater weight or more convincing than the 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." Black's Law Dictionary, 1182 (6th ed. 1990). 2. In Arizona, “it is fundamental that a court attempt to ‘ascertain and give effect to the intention of the parties at the time the contract was made, if at all possible.” Taylor v. State Farm Mutual Auto Insurance, 175 Ariz. 148, 153, 854 P.2d 1154, 1159 (1993). Furthermore, evidence which explains but does not vary or contradict the final agreement is admissible to show the intent of the parties. Id. at 152, 854 P.2d at 1158. 3. Arizona Revised Statute §41-2186 (19) provides that the failure to provide all agreed on goods is grounds for disciplining a licensee.

4. In this case, the circumstances surrounding the contract between Complainants and Respondent Statewide, as demonstrated in the above findings of fact, make it clear that at the time the agreement was entered into between Complainants and Respondent Statewide the parties intended to include the strip footers and living room and master bedroom ceiling fan outlets as part of the term of the purchase price of $53,640.00. Complainants have demonstrated by a preponderance of the evidence, therefore, that Respondent Statewide failed to deliver goods that were a part of the contract. 5. The failure to provide the strip footers and living room and master bedroom ceiling fan outlets amounts to a violation of A.R.S. § 41- 2186(19). Items 15, 16, and 43 in the verified complaint should, therefore, have been verified. RECOMMENDED DECISION Based on the foregoing, it is recommended that the Director order that Items 15, 16, and 43 be verified and that Respondent Statewide be ordered to take reasonable and appropriate corrective action on those items. Done this day, February 14, 2002.

______________________________________ Gregory L. Hanchett Administrative Law Judge

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Original transmitted by mail this _____ day of February, 2002, to:

Department of Building and Fire Safety N. Eric Borg ATTN: Shawna Blank East Virginia, Suite 100 Phoenix, AZ 85004

By ___________________________

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