ALJDEC

02F-G0216-ROC · Registrar of Contractors · 2002-01-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 2, 2002 APPEARANCES: Complainants appeared on their own behalf and Respondent was represented by its attorney, Gregg Thurston. ADMINISTRATIVE LAW JUDGE: Mark A. Silver _____________________________________________________________________

Evidence and testimony were presented and, based upon the entire record in this matter, the following Findings of Fact, Conclusions of Law, and Recommended Order are made:

FINDINGS OF FACT

1. Pursuant to contract, Complainants retained Respondent to construct a new swimming pool for their home. Complainants allege certain deficiencies in the work performed and/or materials provided by Respondent and same are discussed in the findings below. . . . . . . 2. The following salient facts were adduced at the hearing and are important to note:

a. On or about the summer of 2000, Complainants met with Scott Bowman (“Scott”), Respondent’s salesman, to discuss the construction of a swimming pool on their property. After discussing Complainants’ needs and desires referable to the pool, Scott advised Complainants that the cost would be around $33,000.00. b. Complainants had received other bids and asked Scott if he could lower his price, since they preferred to do business with him. According to Complainants, Scott indicated he could give-up some of his commission and would be able to lower the price to around $31,000.00. c. Scott appeared at the instant hearing and testified that he advised Complainants that he could lower the pool construction costs by making some changes. He further indicated that he did not give Complainants any details or specifics regarding how he was going to lower the cost of the pool construction project. Shortly thereafter, Complainants agreed to have Respondent construct their pool. d. Sometime in September 2000, Complainants advised Scott that they would need a copy of the written contract for their mortgage company, since they intended to include the pool on their mortgage. Scott immediately faxed them a contract, which he signed on behalf of Respondent. This contract showed the reduced price of $31,342.00. In addition, this contract document also showed that included in the contract price of $31,342.00 was an automatic water leveler, 2.0 horsepower pump and motor, inch diatomaceous earth filter, and a 400,000 BTU heater. e. The aforementioned contract document was dated August 22, 2000 and was forwarded by Complainants to their mortgage company for the purpose of showing said company the cost for the pool construction and what they were receiving for the contract price. . . . f. On or about the middle of September 2000, Scott contacted Complainants and advised them to come to his office, to sign the contract. Complainants arrived at Respondent’s office and testified that they looked at the bottom of the contract and saw the same $31,342.00 price and therefore, assumed that this document was the exact same document as the one they had previously forwarded to their mortgage company. Thus, they merely signed the document without reading the details of same. This document was signed by Complainants on or about September 17, 2000. g. Scott admits that he did not discuss the September 17, 2000 document details with Complainants, at the time of their signing of the document. h. On or about the Spring of 2001, while the pool was under construction, Mrs. Sommacampagna asked the plumber about the automatic water leveler. At this time she was advised that she had no automatic water leveler and that what she was looking at, which she believed was the automatic water leveler, was merely a leaf trapper. According to Complainants, at this time they examined the contract language on the September 17, 2000 document and compared same to the language in the original August 22, 2000 document and discovered that they were not receiving an automatic water leveling device, they were only receiving a 1.5 horsepower pump and motor, only receiving a 36 inch filter, and a 250,000 BTU heater. i. Once Complainants discovered that the items in Finding of Fact 2(d), above, had either been eliminated or down-sized, they felt Respondent had “cheated” them and they became very upset. Ultimately, after the parties could not resolve their differences, Complainants filed the instant complaint with the Registrar of Contractors. j. Respondent’s position is that the items in question were either down-sized or eliminated to save costs for Complainants. Respondent further indicates that the August 22, 2000 document is not the applicable contract, since same was never signed by Complainants. k. Scott testified that the August 22, 2000 document was the original document he prepared when he thought he was selling Complainants the pool for $33,000.00 and that the specifications were placed on there before the actual price. He indicates when he got the phone call from Complainants, saying that they needed the contract to send to their mortgage company, he then placed the $31,342.00 price on the document, without realizing that said document did not show the eliminated or down-sized items that he intended to use to save costs. l. Although Complainants have paid the full contract price of $31,342.00, Respondent claims entitlement to specified “extra” costs. Complainants dispute these “extra” costs and have refused to pay Respondent’s additional billings.

3. Under all of the facts and circumstances presented herein, it is determined and held that Respondent misled Complainants into believing they were getting the items in question for $31,342.00. It was clearly Respondent’s mistake in issuing the signed August 22, 2000 contract document showing said items and Complainants are found to have acted reasonably in believing that when they signed the September 17, 2000 document, showing a price that was exactly the same as that set forth in the August 22, 2000 document, that the two contracts were exactly the same.

4. Respondent had an affirmative duty to advise Complainants referable to what items were omitted from the original contract document for $31,342.00. Respondent’s failure to provide Complainants with the 2.0 horsepower pump and motor, the automatic water leveler, the 48 inch filter, and the 400,000 BTU heater is found to constitute a wrongful act within the meaning of the charged section of the State’s Contracting laws.

5. As set forth in the Citation and Complaint issued by the Registrar of Contractors, Respondent was advised that in the event of a finding of a violation against Respondent, Respondent’s prior disciplinary record of final Registrar of Contractors’ orders may be considered in mitigation or aggravation. Accordingly, subsequent to conclusion of the instant hearing, notice was taken of official records of the Registrar of Contractors regarding any prior final disciplinary orders against Respondent and said notice revealed numerous prior complaints that had gone into the hearing process. Therefore, Respondent’s prior record is properly deemed to be poor and thus, is viewed as a matter in aggravation for any disciplinary penalties to be imposed as a direct result of this case.

CONCLUSIONS OF LAW

Respondent violated the provisions of A.R.S. § 32-1154A (7).

RECOMMENDED ORDER

In view of the foregoing it is recommended, commencing on the effective date of the Order entered in this matter, that the Class B-05 license of Respondent shall be suspended until the Registrar of Contractors receives written proof that Respondent has accomplished one of the following: a. Provides Complainant with a built-in automatic water leveler, a 2.0 horse-power pump and motor, a 48 inch diatomaceous earth filter, and a 400,000 BTU heater or, b. Concludes other mutually satisfactory arrangements with Complainants. It is further recommended that if Respondent accomplishes the above- described corrective work on or before the effective date of the Order entered in this matter, then the aforementioned license suspension shall not take place. It is further recommended, in addition to the foregoing license suspension, if any, that Respondent’s Class B-05 license be placed on a period of 90 days disciplinary probation. This additional disciplinary penalty shall commence on the effective date of the Order entered in this matter or the date on which notice of Respondent’s compliance with the terms of this Order is filed with the Registrar, whichever is later. It is further recommended, in addition to the above-provided penalties, that as an express condition for the next 2 renewals of Respondent’s license, notwithstanding the existence or absence of any uniform assessment by the Registrar then in effect, Respondent shall be required to pay an additional $100.00 into the Contractors’ Recovery Fund, as authorized by A.R.S. § 32-1132B. Failure to pay such additional deposit into the fund shall result in the rejection of any renewal application and a suspension of Respondent’s license until payment is made and the renewal issued.

Done this day, January 7, 2002

______________________________________ Mark A. Silver Administrative Law Judge

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

Registrar of Contractors Michael P. Goldwater ATTN: Joyce Armijo 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________

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