ALJDEC

02F-RF0182-ROC · Registrar of Contractors · 2002-04-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 8, 2002. APPEARANCES: Debra Staufenberger and Jackie Morlock, Complainants; Ronald Dale Loughridge, Respondent; Randy Lewis, Respondent’s witness; and Mel Purchase, Registrar of Contractors Inspector. ADMINISTRATIVE LAW JUDGE: Dorinda M. Lang. _____________________________________________________________________ Upon filing a claim to the Registrar of Contractors Recovery Fund, the Complainants in this matter established that they are entitled to a pay- out from the Fund in the amount of their damages as they likely existed prior to their allowing deterioration of the floor. That amount is reasonably deemed to be $550.00. Therefore, the undersigned Administrative Law Judge recommends that the Registrar of Contractors issue a pay-out from the Fund on behalf of the Complainants in the amount of $550.00. FINDINGS OF FACT 1. Respondent installed a bamboo floor for the Complainants in February or March 2000 for $5,729.76, with the Complainants supplying the flooring. Afterwards, the floor began to warp and come loose. Some minor tasks also had not been completed. Following a complaint to the Registrar of Contractors, an Inspector verified that the baseboards and bullnose needed finishing and the floorboards needed correction. He issued Corrective Work Orders on October 4, 2000 and April 6, 2001. The work orders were not completed. After failing to answer the Citation and Complaint, Respondent’s license was suspended indefinitely unless he completed the work by the time the Order became final on July 29, 2001. 2. On June 21, 2001, Respondent wrote the Registrar of Contractors complaining that he could not get access to the home to complete the work. On August 9, 2001, the Registrar of Contractors issued an Order declining to close the complaint. Thus, the issue of denial of access had never been heard before the instant hearing. 3. The Complainants filed a Recovery Fund claim. They provided estimates of the cost to remove and replace the entire project. After reviewing the estimates, Registrar of Contractors Inspector Mel Purchase recommended a pay-out from the Fund in the amount of $15,668.48, reflecting the lowest estimate to remove and replace the floors. He testified that the floor is now probably beyond repair, though it probably would have been repairable during the time of the Corrective Work Orders. He stated that if there would have been a bid to repair the floor he probably would have recommended that amount. He also stated that the problem with the boards coming loose was probably an issue with the glue and the Respondent could have contacted the glue manufacturer but the Registrar does not have jurisdiction to do so. 4. Respondent’s witness testified that, had they had access to the home, they would have gotten the glue manufacturer involved or otherwise resolved the problems. Mr. Loughridge testified that Complainants canceled several appointments and later could not be reached to make any appointments at all. Consequently, he was unable to do any corrective work. Although the Complainants denied that they had been unavailable to open their home, the Registrar’s file is replete with evidence to the contrary. The Inspector’s notes reflect that the Respondent was in close contact with him regarding the numerous canceled appointments between the first Corrective Work Order and April 2001. After that point, the Complainants were completely unavailable. The Inspector’s notes confirm that, beginning in April when the second Corrective Work Order was issued, their answering machine would no longer accept any messages. On May 10, 2001, Complainant Morlock left a message with the Inspector stating that the Complainants were aware that the Respondent had a certified letter waiting for them at the Post Office but they were not going to pick it up. On May 11, 2001, the Inspector noted that he was able to speak with Complainant Staufenberger at her work and she indicated that they were aware that the answering machine would not take messages but that they had Caller ID and had not received any calls from the Respondent. The truth of her statement seems unlikely since, if the Complainants have Caller ID (or were not simply avoiding their callers) it would be reasonable for them to have returned at least one of the Inspector’s numerous calls. Yet the notes do not reflect that either Complainant called the Inspector within a week after any of his documented calls When they did call him, the notes reflect that the purpose was to tell him something and not to ask why he’d called. In the May 11th call, Ms. Staufenberger also reiterated that they would not pick up the Respondent’s certified letter. 5. Respondent’s certified letter to the Complainants simply stated that he had been unable to reach them. It asked them to call and make arrangements to resolve the matter. It provided the office telephone number and “Randy’s” cell phone number. 6. Although the Complainants claimed they’d left several messages at Respondent’s office and got no return calls, this too is highly unlikely. The Inspector’s notes reflect that he was usually able to reach the Respondent in one attempt. Further, the Complainants clearly knew they were unavailable for return phone calls, regardless of what messages they left. The Inspector’s notes reflect little difficulty in reaching the Respondent and several discussions with Randy. Concurrent with the Complainants’ unavailability was their repeated objections to having the floors injected to reseal the glue. Considering the above factors, it is clear that the Complainants preferred to hope for a Recovery Fund pay-out rather than to allow the corrective work to take place. While the issue of compliance is not before the Registrar for the purpose of closing the complaint, it does weigh heavily against the Complainants regarding the appropriateness of a pay-out from the Fund. 7. As a result of this complaint, Respondent’s license was suspended and he ultimately canceled it. Therefore, he is unable to do the corrective work under his license. There was no evidence at hearing as to whether he is working under another license now. CONCLUSIONS OF LAW 1. Arizona Revised Statute § 32-1132(A) provides for a Residential Contractor’s Recovery Fund “from which any person injured by an act, representation, transaction or conduct of a residential contractor . . .” may be awarded an amount of not more than $20,000. Arizona Revised Statute § 32-1154(E) provides that the Registrar of Contractors “may” order a pay- out from the Recovery Fund where a contractor’s license has been revoked or suspended as a result of a violation and the contractor is unwilling or unable to remedy the violation. 2. It was not disputed at hearing that the Corrective Work Orders were not completed and that the Respondent’s license had been suspended as a result. It was established that, aside from the issue of the boards coming loose, the job had not been fully completed in some minor ways. Had the Respondent been given reasonable access to the home early on, he would have been able to make the necessary corrections at very little cost, and, eventually, could have involved the glue manufacturer in such a way as to satisfy all parties. 3. While the issue of denying access to the job site is not relevant to a Recovery Fund hearing for the purpose of closing the complaint, it does serve to modify the amount of damages recoverable by the Complainants. Parties suffering damage, even though they were initiated by the other party, have a duty to act reasonably to mitigate the resultant damages. By law, failure to do so precludes recovery of the avoidable damages. Coury Bros. Ranches, Inc. v. Ellsworth, 103 Ariz. 515, 446 P.2d 458 (Ariz. 1968); Barnes v. Lopez, 544 P.2d 694, 25 Ariz. App. 477 (Ariz. App. 1976). 4. Although Complainants claimed that they had not denied access to the home for completion of the Corrective Work Order, their testimony was wholly refuted by the weight of the other evidence at hearing and was not believable. Clearly, they intentionally allowed the floor to proceed in worsening stages without the reasonable amelioration of keeping an appointment or being available by phone or mail. Still, they did incur some damage at the outset due to the incomplete installation and the weakening glue of the boards. Unfortunately, there was no estimate in evidence as to the damages as they existed before the Complainants’ obstruction of the repairs. Therefore, the Administrative Law Judge, rather than leaving them wholly without recompense, must make her own estimate for the Registrar’s approval. Upon due consideration, it is deemed established that a reasonable estimate of the reasonably unavoidable damages is $550.00.

RECOMMENDED DECISION Based upon the foregoing considerations, the undersigned Administrative Law Judge hereby recommends to the Registrar of Contractors that a pay-out from the Recovery Fund be issued to the Complainants in the amount of $550.00. Done this day, April 18, 2002. OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Dorinda M. Lang 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