ALJDEC

01F-C001274(1)-BFS · Department of Building and Fire Safety · 2001-07-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 26, 2001. APPEARANCES: COMPLAINANT: Jeanie Smith, with Stephen Young. RESPONDENT Cavco Industries, L.L.C. : by Fred Crowley, service manager and authorized representative. RESPONDENT CRG Holdings, L.L.C.: by Butch Mitcham, authorized representative, with Durand Berg and Jose Robles, witnesses.

ADMINISTRATIVE LAW JUDGE: Anthony Halas _____________________________________________________________________ Hearing in this matter was convened on June 26, 2001, subsequent to Respondents’ timely answer to the CITATION AND COMPLAINT issued by the Department of Building and Fire Safety on April 19, 2001. On the testimony taken and on the record taken as a whole, the following Findings of Fact, Conclusions of Law, and Recommended Decision are made:

FINDINGS OF FACT

1. In July, 1999, Appellant Jeanie Shaffer (Shaffer) contracted to purchase a manufactured home, Serial No. CAVAZ6005998AB, from Respondent dealer CRG Holdings, L.L.C., dba AAA Homes (AAA Homes) and Respondent manufacturer Cavco Industries, L.L.C. dba Cavco Industries Specialty Division (Cavco). AAA Homes is a subsidiary of Cavco. 2. The home was then manufactured on or about August 4, 1999, and installed by November 10, 1999, at 1545 North 104th Street in Mesa, Arizona. 3. Subsequently, Shaffer filed Complaint No. 00-1/274 with the Department of Building and Fire Safety regarding the manufactured housing, and an inspection was conducted on April 18, 2000, by Inspector Dennis Butzen of the Department’s Office of Manufactured Housing (OMH). On that same date, the inspector then issued the first of two VERIFIED COMPLAINT & SIGN OFF FORMs. 4. Shaffer and Cavco’s representative then both requested re- inspection, and on April 4, 2001, Inspector Butzen again inspected the home, and on that date he then issued the second VERIFIED COMPLAINT & SIGN OFF FORM. Administrative notice is taken of both forms. 5. In the second VERIFIED COMPLAINT & SIGN OFF FORM (April 4, 2001), and as relevant to this matter, the inspector determined that certain of the items complained of were VERIFIED as requiring correction (Items 3a, 5a, 5b, 7a, 7b, 10, and 13)[1]. Other items were either NOT VERIFIED or were determined to have been corrected. 6. Because Complainant chose not to appeal those items NOT VERIFIED for correction, the determination by OMH to that extent is final, and such items were not at issue in this proceeding. 7. Therefore, at issue herein are those items VERIFIED by OMH as requiring correction by the manufacturer (Items 3a, 5a, 7a, 7b, 10, and 13) and by the dealer (Item 5b), but which were not corrected within the time provided by statute, and thus became the subject matter of the CITATION AND COMPLAINT issued by the Department on April 19, 2001, alleging violations by Respondents of A.R.S. §§ 41-2186.1, .12, .19, and .20. 8. At hearing, Complainant Shaffer testified, as did her relative Steven Young (Young), to express their relative dissatisfaction with particular aspects of the original sale, construction, and installation of the manufactured home, as well as the repair work done by workers for the dealer and manufacturer, particularly as such repairs attempted to address drywall and touch-up painting (Items 5a and 5b). 9. Shaffer and Young also testified to confirm that Cavco workers had taken sufficient corrective action on certain items (Items 7a and 13) such that they were now satisfied. For that reason, these items are considered by the undersigned to be moot for purposes of this proceeding. 10. Fred Crowley (Crowley), Cavco’s service manager, testified for Respondent manufacturer to explain the company’s efforts to address the items verified for correction (as well as others), and the difficulty encountered in seeking access, and then comment and response from Complainant relative to the sufficiency of the company’s corrective actions in late April and early May, 2001, on Items 3a, 5a, 7a, 7b, 10, and 13. Crowley conceded that he had not been onsite to view the home after the corrective action had been completed. 11. Butch Mitcham (Mitcham), AAA Homes’ area manager, testified for Respondent dealer, and presented the testimony of Durand Berg (Berg) and Jose Robles (Robles), general manager and employee, respectively, of the installation company hired by the dealer to address Item 5b with corrective action taken in late April, 2001. Mitcham and Berg conceded that neither of them had been on-site since that work was done by Robles and a co-worker. 12. The evidence presented consisted entirely of testimony. Complainant’s offer to submit a two-part videotape was denied as of too limited probative value by the undersigned, given that it was taken prior to the corrective action undertaken by Respondents in April and May, 2001, and because it included matters irrelevant to the items at issue. 13. On the basis of testimony presented relative to the items remaining at issue, the following is found with regard to the specified item:

Item 3a. Interior doors damaged: Front bedroom closet door binds at top hinge, master bedroom closet door hits stop on hinge side, master bath left door is lower than right door.

A. Shaffer and Young acknowledged that certain of the matters identified by the inspector in this item had been corrected by the manufacturer, but contended that the work done on the master bath doors had left too great a gap at the bottom of the double doors, and that the left side door was warped. B. Crowley noted that corrective action had been taken by Cavco employees to address Item 3a, such that he thought it was satisfactory to Complainant, although he had not inspected the work, since he had not heard anything specific to the contrary from her. C. The undersigned finds that although the manufacturer has sufficiently corrected several matters in Item 3a, the bottom gap in the double master bath doors does not meet minimum standard, nor does the warp in the left-side door.

Item 5a. Extensive cracking in drywall: Rear bedroom - ridge or crack at light.

D. Although it is difficult to distinguish Items 5a and 5b (necessary because Item 5a was determined to be a manufacturer’s responsibility, and Item 5b a dealer’s responsibility) in the overall testimony of Shaffer and Young, they are dissatisfied with both the drywall work done and the touch-up painting over the drywall repairs. With regard to Item 5a, Young described cracking apparent running against the joint in the rear bedroom, starting as a narrow hairline but expanding in width. E. Crowley stated that Cavco’s employees had re-mudded the drywall and then painted the defect identified in Item 5a, although he had not had opportunity to view the repair after completion. F. On the evidence presented, the undersigned finds the record insufficient to demonstrate, by a preponderance, that the repairs made by the manufacturer under Item 5a fail to meet minimum standards of workmanship.

Item 5b. Walls crack: Living room at windows at bottom corners; back bedroom above closet door on right side; front bedroom - top left corner of window on front door side, and hitch end - bottom right corner sill; kitchen - below window sill at sink; master bedroom - cracks at both window sills.

G. Shaffer and Young acknowledged that the concerns in Item 5b involving the window corners had been corrected, but contended that a number of cracks still existed in the living room, kitchen, and dining room; that other cracks had merely been painted over; and that taping repairs were visible. They also were significantly dissatisfied with the repairs done by the dealer’s repairman (Robles) because they believed he had used the wrong paint to touch-up his drywall repairs, such that both the touch-up paint color and finish were readily different from the original paint and obvious throughout the home as shiny blotches wherever he had repaired the drywall. H. Robles described his repair work on the drywall and his access to the paint he used to touch-up that work. He noted that he had used up to three coats in some places to cover the marks used by Complainant to indicate where the drywall was not satisfactory to her, and he denied just painting over any cracks needing repair without repairing them first. I. Berg testified to describe his observations of the home, last made before Robles’ repairs, and questioned to what extent his company might be responsible (as the dealer’s sub-contractor) for new cracks occurring after the normal one year warranty period. J. Mitcham explained that the dealer generally left sufficient paint on-site for any touch-up necessary, such that he presumed the paint used by Robles was sufficient, since Robles and Berg had not asked the dealer to provide more. He noted that he had not been on-site to observe whether or not the touch-up paint adequately matched the original paint. K. On the evidence presented, the undersigned finds the record insufficient to demonstrate, by a preponderance, that the actual drywall repairs made by the manufacturer under Item 5b fail to meet minimum standards of workmanship. However, it is found that the touch-up painting done by Robles for the dealer over those repairs fails to meet minimum workmanship standards relative to matching the color and finish of the original paint.

Item 7b. Vanity damaged: same as Item #3. L. Shaffer and Young agree that the damaged vanity in the master bath was essentially corrected by the manufacturer, but contend that its employees failed to replace the trim completely. M. Crowley confirmed that the damaged vanity had been addressed but conceded that he was unaware whether all the trim had been replaced at that time. N. On this record, the undersigned finds that the damaged vanity has been substantially corrected, but that replacement of the trim is incomplete and does not meet minimal standards of workmanship.

Item 10. Guest bath diverter hits cold water faucet handle. O. Shaffer and Young acknowledge that Cavco employees changed handles in the guest bath shower to correct this problem, but contend that now the cold water handle is no longer operable. P. Crowley confirmed that the company had addressed this item, again noting that because Complainant would not either sign off on the corrective action attempted by the manufacturer, or explain whether or not such action was adequate, he had no idea this had not been corrected to her satisfaction. He agreed that the cold water handle should operate without problem and that it would be for the manufacturer to make it so, probably just by an adjustment. Q. The undersigned finds that the manufacturer has substantially corrected the diverter problem but in doing so has rendered the cold water handle inoperable, contrary to minimal workmanship standard.

CONCLUSIONS OF LAW 1. Under applicable statutes and rules, it is well-settled that the owner of manufactured housing may request a hearing in the event that verified items of complaint are not timely and effectively rectified, and should such be so determined by the hearing tribunal, the license-holder responsible for corrective action may be subject to sanctions pursuant to A.R.S. § 41-2181. 2. The burden of proving, by a preponderance of the evidence, that the verified items are not rectified is on the home-owner, as the complaining party. 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”, Udall, Arizona Law of Evidence, §5 (1960), or, “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, at 1182, (6th ed. 1990). 3. In this matter, it is concluded by the undersigned that Complainant Shaffer has met her burden of proving that Respondent manufacturer Cavco has failed to complete correction of VERIFIED Items 3a, 7b, and 10, as specifically found above in Findings of Fact 13C, 13N, and 13Q. 4. It is further concluded that Complainant has met her burden of proving that Respondent dealer AAA Homes has failed to complete correction of VERIFIED Item 5b as specifically found in Finding of Fact 13K. 5. Finally, the undersigned also notes that two factors have additionally contributed to the frustration readily evident on the part of Shaffer and Young and the representatives of the manufacturer and the dealer: A. First, Complainant has been unwilling to indicate whether the corrective work done is satisfactory to her, either by “signing off” on that work as satisfactory or by clarifying how or why it is unsatisfactory. As a result, Respondents are unable to determine whether or when the corrective work is completed. B. Then, although Respondents have made good faith efforts to address corrective action necessary within the extent of the access necessary and provided by Complainant, neither the manufacturer nor the dealer has provided sufficient supervisory oversight over the corrective work actually done to render any informed opinion whether that work meets minimum workmanship or industry standard.

RECOMMENDED DECISION Based upon the foregoing, IT IS RECOMMENDED that, commencing on the effective date of the Order issued in this matter, the Class M-9E License No. 7100 of Respondent manufacturer shall be suspended until such time as the Office receives written proof that the Respondent has accomplished appropriate and effective remedial work on the items remaining from the VERIFIED COMPLAINT & SIGN OFF FORM of April 4, 2001, as set forth in Conclusion of Law 3; IT IS FURTHER RECOMMENDED that if Respondent manufacturer accomplishes the above described corrective work on or before the effective date of the Order entered in this matter, then the aforementioned suspension shall not take place and the CITATION AND COMPLAINT upon which it is based shall be closed; IT IS FURTHER RECOMMENDED that, commencing on the effective date of the Order issued in this matter, the Class D-12 License No. 7078 of Respondent dealer shall be suspended until such time as the Office receives written proof that the Respondent has accomplished appropriate and effective remedial work on the items remaining from the VERIFIED COMPLAINT & SIGN OFF FORM of April 4, 2001, as set forth in Conclusion of Law 4; IT IS FURTHER RECOMMENDED that if Respondent dealer accomplishes the above described corrective work on or before the effective date of the Order entered in this matter, then the aforementioned suspension shall not take place and the CITATION AND COMPLAINT upon which it is based shall be closed; // //

IT IS FURTHER RECOMMENDED that Complainant grant reasonable access to Respondent manufacturer and Respondent dealer in order to perform the corrective work required by the Order entered in this matter or Respondents shall be relieved of any further obligations under said Order. Done this day, July 10, 2001.

______________________________________ Anthony Halas Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2001, to:

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

By ___________________________

----------------------- [1] Item 5b was deemed the responsibility of the dealer, and all other items the responsibility of the manufacturer)

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