ALJDEC

01F-R012004-BFS · Department of Building and Fire Safety · 2001-11-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 15 and 30, 2001. APPEARANCES: COMPLAINANT: Miles White, with Christine and Jeramey Cochran. RESPONDENT: by Carlos Estrada, Esq., with Guy Williams (Qualifying Party). DEPARTMENT OF BUILDING AND FIRE SAFETY/OFFICE OF MANUFACTURED HOUSING: Inspector Dennis Butzen.

ADMINISTRATIVE LAW JUDGE: Anthony Halas. _____________________________________________________________________ Hearing in this matter convened on October 15 and 30, 2001 to consider Complainant’s Consumer Recovery Fund claim pursuant to A.R.S. § 41- 2190. On the basis of the testimony and evidence presented, and the entire record, the following Findings of Fact, Conclusions of Law, and Order are made to the Director of the Department:

FINDINGS OF FACT

1. Complainant Miles White (White) purchased a manufactured home (Serial No. 15700341AB) from Respondent dealer Oakcrest Mobile Homes, Inc. (Oakcrest Mobile Homes) in March 2000. The purchase was made by Mr. White for the purpose of providing a home for White’s daughter and son-in-law (Christine and Jeramey Cochran), and their infant, since the Cochrans could not yet financially qualify for such a purchase. 2. Respondent dealer Oakcrest Mobile Homes was previously issued License No. 7085, Class D-8, by the Department of Building and Fire Safety (Department). 3. Ms. Cochran subsequently filed a complaint relative to deficiencies in the manufactured housing her father had purchased from Respondent dealer. Because Respondent’s license was revoked in another matter by the Department, effective May 29, 2001, the licensee was unable to comply with the VERIFIED COMPLAINT & SIGN OFF FORM issued by the Department’s inspector Dennis Butzen after his inspection of the home on June 4, 2001. Inspector Butzen verified for correction by the dealer Item Nos. 1, 2, 3a and b, 4, 6, and 7. No representative attended the inspection on behalf of Respondent dealer. Item No. 8 was verified for the dealer to correct by letter issued by Inspector Butzen on June 26, 2001. Because of the dealer’s license revocation, no hearing was ever convened on the items verified for dealer correction. 4. On August 1, 2001, Complainant White filed a claim seeking payment of $14,995.95 from the Consumer Recovery Fund pursuant to A.R.S. § 41-2190, and hearing was duly scheduled. 5. At hearing, Miles White appeared and testified, as did Christine and Jeramey Cochran. They offered Exhibits 1, 2, and 3 (as estimated costs to repair or complete the items previously verified for correction) as well as Exhibit 4 (Specification and Order Sheet), Exhibit 5 (copy of Purchase Agreement), and Exhibit 6 (Floor Plan with annotations) The exhibits were marked and admitted. 6. Ms. Cochran explained that the three bids she had submitted (Exhibits 1, 2, and 3) were all based on the Specification and Order Sheet (Exhibit 4), as well as Inspector Butzen’s VERIFIED COMPLAINT & SIGN OFF FORM (which in turn was based on the Specification and Order Sheet), and her own understanding of the meaning of the Addendum to Purchase Contract and Spec Sheet (Exhibit C). 7. Mr. and Mrs. Cochran testified to describe the circumstances of their fairly rushed efforts to qualify (first on their own, and then by means of Mr. White) and negotiate to purchase a manufactured home from Respondent’s sales agent, Marc Williams. They both conceded that their initial list of options had resulted in a cost estimate beyond the maximum they and Mr. White could budget, such that they had eliminated certain items in their ongoing discussions with Marc Williams. 8. However, the Cochrans contended that the various options listed on the undated Specification and Order Sheet (Exhibit 4) were all to be included as part of the purchase contract, but were not, such that when they complained, the dealer had agreed to provide and install them. 9. To that end, Mr. White (and Ms. Cochran) confirmed that Mr. White had signed the Addendum to Purchase Contract and Spec Sheet (Exhibit C) on August 28, 2000. Ms. Cochran opined that the Addendum language stating “OAKCREST shall provide Miles White with a chandelier, two medicine cabinets, a master bedroom ceiling fan, a one piece bath tub shower for the guest bathroom and provide and install one missing window and complete painting of the exterior storm window” meant that the dealer was to provide and install all such items, and not just provide them all but only install the missing window. 10. Respondent Oakcrest Mobile Homes appeared, represented by counsel, and provided the testimony of Guy Williams (Williams), a corporate officer and qualifying party on the license, and offered Exhibit A (August 26, 2000 Service and Parts Request), Exhibit B (April 7, 2000 Production Ticket), and Exhibit C (August 28, 2000, Addendum to Purchase Contract and Spec Sheet). 11. Williams stated that Marc Williams had been the sales agent for the dealer in negotiating the sale to Mr. White and his daughter and son-in- law, but that he (Guy Williams) had first become involved in August 2000 when the Cochrans were dissatisfied that the manufactured home did not include everything on their Specification and Order Sheet “wish list” (Exhibit 4). 12. Although Williams contended that the wish list was just that, and not included in the contract because those items exceeded the buyer’s budget, he confirmed that he had agreed to and drafted the Addendum to Purchase Contract and Spec Sheet (Exhibit C) to try to satisfy Mr. White and particularly the Cochrans. 13. Williams stated the dealer had complied with the specific terms of the Addendum by providing the several listed items, and was willing to install the provided exterior window and complete painting of the exterior storm window, all in accord with the language of the addendum. He denied that the Addendum meant that the dealer was to provide and install all the listed items. 14. Williams also stated that a Specification and Order Sheet (such as Exhibit 4) was always used by home buyers to list their desired options, but that this “wish list” was made before the purchase agreement and financing was determined, and was therefore should not to be considered as part of the contract agreement upon which Inspector Butzen could rely in verifying items for the dealer to correct pursuant to that contract. 15. Inspector Butzen also appeared, by subpoena issued at Respondent’s request, and testified to generally explain the basis for his verification of specific items in this case. He confirmed that at the time of his inspection, since he was provided no other documentation, he relied on the Specification and Order Sheet (Exhibit 4) provided by Ms. Cochran as apparently representative of the contractually-agreed options to be included in the purchase price for the manufactured home. 16. However, on the basis of his more complete review of the actual contract and manufacturer’s production documents (Exhibits 5, C, and B), Inspector Butzen concluded that the Specification and Order Sheet was really just a “wish list” which the Cochrans had used to list what they wanted, and not necessarily what they could ultimately afford, and which therefore did not become part of what had later been included in the Purchase Agreement (Exhibit 5) and Addendum to Purchase Contract and Spec Sheet (Exhibit C) executed between Mr. White and Respondent dealer, or the manufacturer’s Production Ticket (Exhibit B). 17. Of those items he had previously verified for correction by the dealer (i.e., 1, 2, 3a and b, 4, 6, 7, and 8), Inspector Butzen was able at hearing to reconfirm verification of only two items: A. Item No. 2, to the extent that the dealer was to “… provide and install one missing window and complete painting of the exterior storm window” according to the Addendum to Purchase Contract and Spec Sheet (Exhibit C); and B. Item No. 6, to the extent that the vinyl skirting around the home should be corrected by the dealer to a uniform beige color, rather than the two colors present. He based this conclusion on the entry in the Purchase Agreement (Exhibit 5) indicating that vinyl skirting was to be included, and his own aesthetic appreciation that it should be of one color. 18. In accord with Inspector Butzen’s re-verification of Item Nos. 2 and 6: A. Reference to Exhibit 1, the bid by Master Mobile Installer, indicates that the bid price for touch-up of exterior paint (the equivalent of Item No. 2) was $380.00, and for replacing skirting (the equivalent to Item No. 6) was $890.00, for a total of $1270.00. B. Reference to Exhibit 2, the bid by Copperstate Installers, does not provide sufficiently clear and legible information to ascertain that company’s bid price for these items; and C. Reference to Exhibit 3, the bid by Cornerstone-Eagle Const. and Dev., indicates that the bid price for touch-up of exterior paint (the equivalent of Item No. 2) was $420.00, and for replacing skirting (the equivalent to Item No. 6) was $950.00, for a total of $1370.00.

CONCLUSIONS OF LAW 1. In this administrative proceeding, Complainant White bears the burden of proof such that he must establish (primarily through the testimony and evidence provided by his daughter, Christine Cochran) a right to a recovery from the Fund, and the amount, pursuant to A.R.S. § 41- 2190.B, by a “preponderance” of the evidence. See A.A.C. R2-19-119; see also Culpepper v. State, 187 Ariz. 431, 438, 930 P.2d 508, 515 (App. 1996).

2. “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). 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.” Black’s Law Dictionary at page 1064 (6th ed. 1990). 3. On the basis of the testimony and evidence presented, the undersigned finds and concludes that the Specification and Order Sheet (Exhibit 4) upon which Complainant now relies (and upon which the Department’s inspector previously relied but who has since re-verified only two of the items originally verified for correction) was not incorporated into the purchase agreement and subsequent addendum which constitutes the essential contractual relationship between the parties. 4. In addition, the language of the Addendum to Purchase Contract and Spec Sheet (Exhibit C) is deemed to be clear on its face in stating that Respondent dealer was to “provide” certain items, and to “provide and install” one other item. To read the language to require that all the items be provided and installed is contrary to the plain meaning of that language, and such a reading is therefore neither accepted nor adopted by the undersigned. 5. For those reasons, Respondent dealer is not legally obligated to correct any but Item Nos. 2 and 6, as re-verified by the inspector. Although Complainant White and Mr. and Mrs. Cochran believe they were promised the various items indicated on the Specification and Order Sheet, the undersigned must conclude that those items were simply their wish list to provide a starting point to the negotiating process, which process eventually resulted in a contract reduced to writing by means of the Purchase Agreement in March 2000, as modified by the subsequent Addendum in August 2000. 6. Because he is the purchaser of the manufactured home, Complainant White is deemed to be a “consumer” as defined by statute, and is entitled to receive payment from the Consumer Recovery Fund for actual damages as a result of Respondent’s acts or omissions which Respondent can no longer correct due to revocation of its license. 7. Therefore, the undersigned determines that based on the evidence presented at hearing, Complainant has established damages under the contract by means of the low bid by Master Mobile Installer (Exhibit 1) for Item Nos. 2 and 6 in the amount of $1270.00. The undersigned concludes that this amount properly constitutes actual or compensatory damages and costs in this instance and comprises the appropriate and reasonable elements of Complainant’s Recovery Fund claim.

ORDER In view of the foregoing, IT IS ORDERED that the Department of Building and Fire Safety shall commence and finalize payment procedures from the Consumer Recovery Fund for an award to Complainant in the amount of $1270.00. IT IS FURTHER ORDERED that the revoked Class D-8 License No. 7085 of Respondent Oakcrest Mobile Homes, Inc. shall be suspended and remain so until Respondent has repaid in full the amount of the above claim, plus interest, pursuant to A.R.S. § 41-2190(D). Done this day, November 14, 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 ___________________________

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