ALJDEC

01F-C012157-BFS · Department of Building and Fire Safety · 2002-01-28

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 10, 2002 APPEARANCES: Complainant Lavinia Ellsworth appeared on her own behalf. Respondent Myron Karsten, the owner and qualifying party of Karsten Ltd., Inc. dba Price-Rite Manufactured Housing (“Price-rite”) appeared on behalf of Price-Rite. ADMINISTRATIVE LAW JUDGE: Constantino Flores _____________________________________________________________________ The question presented in this case is whether grounds exist to take disciplinary action against Price-Rite for violation of various provisions of A.R.S. § 41-2186, in regards to failing to manufacture or install subassemblies, units or accessory structures in a workmanlike manner. Based upon the evidence presented at the hearing, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT Price-Rite holds a Class D-12 License (No. 6031) issued by the Arizona Department of Building and Fire Safety (the “Department”). Myron Karsten is Price-Rite’s owner and qualifying party. On August 23, 2001, in the presence of the Complainant Lavinia Ellsworth, and Ron Foster (deceased) from Price-rite, Inspector Dennis Butzen from the Department conducted an inspection regarding the numerous items of complaint submitted by Ms. Ellsworth. On August 24, 2001, as a result of Inspector Butzen’s findings, the Department issued a “Verified Complaint and Sign-Off Form” in which it itemized each of Ms. Ellsworth’s complaints, and stated whether those items were VERIFIED (i.e., subject to correction by the manufacturer or dealer) or NOT VERIFIED (i.e., not subject to correction). Of the ten items contained in the Verified Complaint, only item No. 10 was VERIFIED, concerning wall cracks which were seen throughout the manufactured home. The Department directed the dealer to make appropriate corrections of this item. On November 7, 2001, the Department filed an amended Citation and Complaint against Price-Rite alleging that Price-Rite had not satisfied item No. 10 of the Verified Complaint, and thus it would be subject to sanctions under A.R.S. § 41-2186. On November 12, 2001, Myron Karsten submitted a written response to the Citation and Complaint. In it, he stated that Ronald Foster, who is now deceased, was the person who completed the transactions concerning Ms. Ellsworth’s home on behalf of High Desert Manufactured Housing. Further, Mr. Karsten explained that he had no possible way to know who the subcontractor was who performed the drywall, tape and texture of Ms. Ellsworth’s home, and that if he could obtain the identity of the subcontractor, he would “cure the problem with the complainant.” On November 30, 2001, the Department filed a Notice of Hearing, setting hearing in this matter for January 10, 2002, at 9:00 a.m. Per this notice, the issues to be addressed surround item No. 10 not having been corrected. At hearing, Ms. Ellsworth testified that there were numerous cracks on the walls and ceiling throughout her house, as well as significant separations where walls and ceiling are attached. Also at hearing, Mr. Karsten essentially reiterated his position as stated in his response to the Citation and Complaint. Furthermore, he stated that the way he will proceed in regards to item No. 10 is to first have a subcontractor inspect Ms. Ellsworth’s house to determine which cracks and separations are his responsibility. Once this determination is made, he will then correct the areas for which he feels he is responsible. Jeff Winter, Mr. Karsten’s hired subcontractor, explained that there could be many reasons why there would be cracks and separations in Ms. Ellsworth’s house. He further stated that the first time that he attempted to contact Ms. Ellsworth in regards to item No. 10, while working for Mr. Karsten, was on the Friday prior to this hearing. CONCLUSIONS OF LAW The burden of proof at an administrative hearing is generally upon the Complainant. Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). Further, the standard of proof at hearing is by preponderance of the evidence. Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d (App. 1985). Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that Respondent has violated any provision of the governing statutes. Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996). The Administrative Law Judge concludes that even though Inspector Butzen did not testify, his determination as a Department inspector must be given some presumptive weight. Therefore, absent substantial evidence to the contrary, the inspector’s determinations, although hearsay, cannot be ignored. The Administrative Law Judge concludes that Inspector Butzen’s decision to VERIFY item No. 10 in Ms. Ellworth’s Verified Complaint is supported by the evidence and should be upheld. The Director of the Department of Building and Fire Safety (the “Director”) is empowered to verify complaints and require manufacturers and/or dealers to respond to and satisfy verified complaints within 30 days. Arizona Revised Statutes (“A.R.S.”) § 41-2153. The August 24, 2001 letter provided the requisite 30 days within which Price-Rite was required to correct item No. 10. The Director is also empowered to suspend, revoke, place on probation, or impose an administrative penalty on any license held by a dealer who violates the provisions in A.R.S. § 41-2186. Subsection 12 of A.R.S. § 41-2186 prohibits “[f]ailure to respond relative to a verified complaint after notice of such complaint.” Further, A.R.S. § 41-2186(19) and (20) grant the Department the authority to take disciplinary action against a licensee which fails to provide all agreed on goods and services, as well as against a licensee which fails to manufacture or install subassemblies, units or accessory structures in a workmanlike manner. The evidence shows that Respondent Price-Rite has not corrected item No. 10 of the Citation and Complaint as required, thereby violating A.R.S. § 41-2186(1), (12), (19), and (20). Based upon the foregoing violations, it is appropriate for the Department to impose discipline against Price-Rite’s license. RECOMMENDED ORDER In view of the foregoing, IT IS RECOMMENDED that commencing on the effective date of the Department’s Order entered in this matter, that the Respondent Price-Rite’s Class D-12 license (No. 6031), be actively suspended unless the Department receives written notification from the parties that Respondent has completed appropriate and effective repairs to the wall cracks and separations which are present throughout Ms. Ellsworth’s house, in accordance with workmanship standards and regulatory standards. IT IS FURTHER RECOMMENDED that if written notification and agreement of this repair is received, or if Complainant refuses to allow access to Respondent for such repairs, before the effective date of the Department’s Order, no suspension of the license shall occur, and the Department’s Case 01-2/157 [Office of Administrative Hearings Docket No. 01F-C012157-BFS] shall be closed. Done this day, January 30, 2002

______________________________________ Constantino Flores Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 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