ALJDEC

01F-M1422-ROC · Registrar of Contractors · 2002-01-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 3, 2002 at 9:00 a.m. APPEARANCES: Complainant Elizabeth E. Streiff appeared on her own behalf; Respondent Lennar Communities Development appeared through its Customer Care Manager, Rod Beach. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

The parties presented evidence on whether Respondent had violated A.R.S. § 32-1154.A.3, .7, or .23 by failing to install a 10’ gate at Complainant’s residence and, if so, the appropriate penalty that the Registrar of Contractors should impose on Respondent’s contractor’s license as a result of the violation. Based on the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order to the Registrar. FINDINGS OF FACT The Registrar issued License No. 037167, Class B to Respondent, a corporation, on December 26, 1972. In October 1999, Complainant signed a contract to purchase for $170,095 a residence that Respondent would construct on Lot 26 in its Parkside at Santa Rita Ranch, Unit #4 development, whose street address would be 10207 E. Pampa Ave. in Mesa. As part of the purchase price, Complainant paid $1,000.00 for a lot premium on a larger lot that would allow a 10’ gate to be constructed, behind which Complainant could park her large boat. Complainant also paid $275.00 for a 10’ wide drive gate, which was shown on the east side of the residence on the plans. The plans showed the side yard setback on the east side of the residence to be 10’5” and the street side yard on the west side of the residence to be 10’. Complainant moved into the residence in July 2000. On May 8, 2001, Complainant made a complaint to the Registrar against Respondent’s contractor’s license for its failure to install a 10’ gate and eleven other alleged deficiencies. The complaint was assigned to Inspector Dennis Cook, who inspected the residence and, on June 21, 2001, noted that “[n]o evidence was shown that the house is improperly located on the lot” and directed Respondent to “provide the largest possible RV gate in the available space” within fifteen calendar days. Complainant subsequently requested an administrative hearing. The Registrar issued a Citation and Complaint against Respondent’s contractor’s license, charging violations of A.R.S. § 32-1154.A.3, .7, and .23. Respondent answered the Citation and Complaint, informing the Registrar that it had made a written offer to settle but that Complainant had not responded to the offer. It had filed an answer “to continue progressing with the issues in question.” The Registrar subsequently issued a notice of hearing and referred the matter to the Office of Administrative Hearings. At the hearing, Complainant agreed that Respondent had corrected or that she had abandoned her complaints concerning all alleged deficiencies other than the 10’ gate. She requested and Respondent agreed to perform additional corrective work with respect to some items that Complainant felt again needed attention. Complainant testified at the hearing that Respondent had sent workers out at least two dozen times to attempt to install a 10’ gate but that, at the time of hearing, they had not succeeded. As a result, she must pay $90.00 per month to store her boat at a remote location. The boat cost $50,000.00 and the remote location is less secure than Complainant feels her yard would be. In addition, it is less convenient. Respondent testified that it offered to refund the $1,000.00 lot premium and the $275.00 that Complainant paid for the gate. Complainant rejected this offer. She was promised a 10’ gate. Respondent testified that the opening of the gate is currently 8’9”. The side yard has only a 10’6” setback, which is reduced by 4” or 5” due to the block wall and its foundation. This nets out to 10’1” or 10’2” . If a 10” gate were installed, it would overlap the fence and be hard to open. At the hearing, Respondent’s representative had an idea that had not been tried before to widen the gate. According to Respondent’s representative, by mounting the gate of the face of the fence and turning a 6” pilaster by the residence sideways or replacing it with a 4” post, a gate could be installed that would result in a 9’9” clearance. Complainant testified that the pilaster had already been turned sideways. Inspector Cook testified that a 10’ gate would have a 9’6” to 9’9” opening. He believes that a gate having this size opening could be installed at Complainant’s residence, but is not certain. It is not possible to install a 10’ gate, however. Inspector Cook testified that he saw no evidence of fraud. He found no evidence that the residence was improperly located on the lot. The government authority accepted Respondent’s placement of the residence. Instead, whoever had thought that a 10’ gate could be installed across a side yard having a 10’5” setback, as shown on the plans, had made a mistake. The Citation and Complaint advised Respondent that, if it were found in violation of any contracting law, its prior disciplinary record of final Registrar of Contractors’ orders could be considered in mitigation or aggravation. Notice is taken of the Registrar’s records, which reveal that Respondent has only three closed complaints on the current record. The Administrative Law Judge considers this to be a good record. CONCLUSIONS OF LAW In this administrative proceeding, Complainant bears 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] Complainant has established that Respondent violated A.R.S. § 32- 1154.A.3[4] and .23[5] in failing to install a 10’ gate at her residence. Complainant has not established that Respondent violated A.R.S. § 32- 1154.A.7.[6] The legislature has not empowered either the Office of Administrative Hearings or the Registrar to adjudicate or award money damages, which must be recovered, if at all, through civil court action.[7] Complainant therefore is not entitled in this action to an order that Respondent reimburse or pay her for the $90.00 monthly cost of storage.[8] The Registrar may resolve contractual disputes between licensed contractors if such resolution is ancillary to its regulatory mission and may penalize a contractor’s license by ordering payment of restitution if a proven statutory violation cannot be remedied by corrective work.[9] The evidence at hearing indicated, but did not establish conclusively, that it may not be possible to install a gate that had the same size opening as the 10’ gate that Respondent contracted to construct.[10] If this is so, Complainant is entitled to the return of the $1,275.00 she paid for a lot premium and for the cost of the 10’ gate. But Complainant is not entitled to any greater sized opening in this forum than a conventional 10’ gate would have provided. The evidence at the hearing established that this would be no less than 9’6” and no greater than a 9’9”. If Respondent can construct a gate, using unconventional means, that has at least a 9’6” opening, as a practical matter, it has provided what it contracted to provide. RECOMMENDED ORDER Based on the foregoing, it is recommended that the Registrar suspend Respondent Lennar Communities Development Inc.’s contractor’s license No. 037167, Class B on the effective date of the order in this matter, forty days after service. It is further recommended that if, on or before the effective date of the Registrar’s order, Respondent furnishes to the Registrar proof in writing that it has either (1) corrected the gate at Complainant’s residence so that the gate has at least a 9’6” opening or (2) paid Complainant $1,275.00 for the lot premium and cost of the gate, no suspension take place and the Registrar may close Case No. M01-1422. Done this day, January 9, 2002.

______________________________________ Diane Mihalsky Administrative Law Judge

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

Registrar of Contractors Michael P. Goldwater, Director 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 “[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.”

[6] 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.”

[7] See J.W. Hancock Enterprises, Inc. v. Arizona State Registrar of Contractors, 142 Ariz. 400, 406, 690 P.2d 119, 125 (Ct. App. 1984). [8] Complainant may of course seek these claimed consequential damages in a court having appropriate civil jurisdiction. Respondent’s representative testified that the CC&R’s for the subdivision prohibited storage of any vehicle more than 74” wide or 6’ high. This testimony is not relevant in this forum but may be relevant in civil court to the issue of calculation of Complainant’s damages, if any.

[9] See Sunpower of Arizona v. Arizona Registrar of Contractors, 166 Ariz. 437, 441, 803 P.2d 430, 434 (Ct. App. 1990).

[10] In Sunpower, the Arizona Court of Appeals upheld the Registrar’s power to order a contractor to return to a property owner the cost of a solar heater where, although the contractor had made several attempts to repair the heater, he could not make it provide a habitable degree of heat. See id.

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