ALJDEC decisions subject to certification as final

06F-M2029-ROC-com · Registrar of Contractors · 2007-07-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: 12 June 2007 APPEARANCES: Complainant: Brian & Cindy Novak. Respondent: Jay Graif, Attorney for Respondents Caliber Holdings Company LLC and Deseret Sky Development LLC; Mike Lichtie, Qualifying Party, Caliber Holdings; Mike Homes, Arizona Division President, Caliber Holdings, Rhonda Woodward, Vice President, Caliber Holdings; Brent Butcher Qualifying Party and Owner, Suntex Homes. Others: Jack Clark, Inspector, Arizona Registrar of Contractors ADMINISTRATIVE LAW JUDGE: Maurice McWhirter _____________________________________________________________________ Complainant filed a complaint with the Arizona Registrar of Contractors (“ROC”) alleging Respondents committed violations of certain provisions of ARS §32-1154(A). Prior to completion of the hearing on the complaint, a settlement was reached between the parties. Complainant moved to reopen the complaint alleging failure on the part of the Respondents to comply with the settlement. The instant hearing is a compliance hearing being held solely to determine whether or not Respondent Caliber Holdings Company (“Respondent”) complied with the settlement. Having heard the testimony of the witnesses and having read and considered the entire record in this matter, the under-signed Administrative Law Judge now makes the following Findings of Fact and Conclusions of Law and issues the following Recommended Decision to the ROC.

FINDINGS OF FACT 1. Respondent was a subcontractor to Complainant on a residential home construction project at 1265 Longview Drive, Prescott, Arizona. Complainant was not satisfied with Respondent’s workmanship on some portions of the project. As a result, Complainant filed a complaint with the ROC and an onsite inspection of the work was conducted by John Prince, inspector for the ROC. Mr. Prince issued a Corrective Work Order (“CWO”) on 31 August 2006. Ultimately, a Citation and Complaint was issued by the ROC against Respondent’s ROC license on 5 December 2006. 2. At the initial 4 December 2006 hearing in this case, a settlement between the parties was reached wherein certain items listed on Exhibit “A” of the Stipulation and Agreement dated 4 December 2006 the parties entered into were to be corrected by Respondent. However, on 3 April 2007, the ROC re-opened the instant complaint and set a compliance hearing based upon Complainant’s 31 January 2007 written allegation that Respondent had breached the Stipulation and Agreement. 3. At the instant compliance hearing, it was determined that all of the items listed on Exhibit A had been addressed and resolved by Respondent, with the exception of items 5, 8, 9, 10, 11, 14, 15, 18, 20 & 29, which Complainant contended remained unresolved. Mr. Clark, an ROC inspector, made a pre-compliance hearing inspection of Complainant’s home in the afternoon of 8 June 2007 to ascertain the extent to which the Exhibit A items had been corrected. He specially inspected the items Complainants indicated were not corrected. Mr. Clark’s testimony conclusively proved that items 5, 8, 10, 11, 15, & 29 had been corrected to within ROC standards. In particular, his findings were: Item 5: There was no evidence to support Complainant contention of inordinate ground settling around the front door. The ground level around front sidewalk was appropriate, and not unsightly. Item 8: The rolling gate operates properly and is constructed within ROC standards. The weathering of the gate wood is normal given the amount of time the gate has been exposed to the environment. Periodic painting or weatherproofing of the gate wood is the responsibility of the Complainant. The rattling noise the gate makes when operated that Complainant complains of is normal and within ROC standards. Item 10: The backdoor has been replaced by Respondent, installed correctly, and operates within ROC standards. Item 11: The kitchen drawer has been appropriately repaired. Item 15: The basement windows have been repaired appropriately. They are now square, operate adequately, and shut properly. Mr. Clark stated that the windows might benefit from some additional adjustment, or possible replacement of the plastic track rollers, which seemed to operate with some slight roughness, but that the windows current operation and installation met ROC standards. Item 29: During the operation of the air conditioning units, no untoward noise or rattling complained of by the Complainants could be detected. 4. The only items remaining to be corrected by Respondent were Items 9, 14, 18 & 20, which Respondent admitted still needed to be repaired. Items 9 and Item 18 are damaged trusses in the kitchen ceiling (a roof truss) and the basement ceiling (a floor truss), respectively. Items 14 and 20 are the drywall repair and painting associated with repairing the holes in the ceilings made to locate and repair the trusses. The trusses were damaged by subcontractors on the home construction job, who cut the trusses to make way for pipes and other utilities. The damage was discovered when the floor and ceiling near the damaged trusses began to sag. 5. Respondent, cognizant of the fact that the damaged trusses constituted a structural problem with the Complainant’s home that needed a professional solution, contacted Dan Bingham, a structural engineer, to do an analysis of the kitchen ceiling truss and submit a repair solution. However, due a tendon injury Mr. Bingham subsequently suffered, and the fact that the trusses involved were manufactured by Ballard Truss Company, Mr. Bingham recommended Mr. Farley Rhodes, another structural engineer that Ballard Truss Company utilized exclusively in the Phoenix area for purposes of engineering repair solutions for damaged Ballard trusses. The change in engineers caused some delay in scheduling the truss repair. Scheduling a date to undertake the repair became so difficult due to Complainant’s repeated unavailability, that the intercession of Respondent’s attorney was required to reach a mutually agreeable date. Nonetheless, on 8 June 2007 at 0800 MST, after several prior aborted attempts to schedule a mutually convenient time with the Complainants to get the trusses repaired, Mr. Holmes of Respondent’s organization arrived with a work crew at Complainant’s home to repair the trusses, and met with Mrs. Novak. Mr. Holmes indicated that the 8 June 2007 repair date was selected because the ROC pre-hearing inspection was scheduled at 1530 MST that same day, and that Respondent wanted the ROC inspector to be able to see the repaired trusses before the access holes to the trusses in the drywall were covered with new drywall. Repair time is estimated at 8 hours, spread out over 5 days: 4 hours to repair the trusses; 3 hours for drywall repair; 1 hour to paint. The drywall repair and painting requires the work to be spread out over 5 days to allow for repeated application and drying of drywall patch mix and paint. 6. After observing the work that needed to be accomplished, the single workman assigned to do the truss repair was hesitant to try and accomplish the repair alone. Also, it was determined that some additional materials were needed to conduct the repair. Mr. Holmes informed Mrs. Novak of the situation, and stated they would return shortly with the additional materials, to which Mrs. Novak agreed. The work detail, with the additional workmen and materials, returned at approximately 1000 MST. However, Mrs. Novak denied the work detail access to the home, insisting that Mr. Holmes prove that the workers he had hired to conduct the repair were ROC licensed before she would allow them to conduct the repair. After some discussion, the work detail (who were employees of “400 Construction”, a company from which Mr. Holmes had often obtained labor for minor construction repair in the past) returned to the work detail’s offices, obtained some 400 Construction business cards that had 400 Construction’s ROC license number on it, and returned to the Complainant’s home at approximately 1300 MST, but was unable to gain access to the home, as there was no answer at the door, and no answer at the Complaint’s phone number. Mrs. Novak believes she must have been in the shower at that time. The work crew left, but was still available to conduct the repair at 1530 MST, when Mrs. Novak allowed Mr. Clark to enter her home for purposes of the ROC inspection. Despite being unable to complete the truss repair on 8 June 2007, Respondent stands ready to complete the repair at a future mutually agreeable date. 7. No evidence was presented that gave any indication that Respondent Deseret Sky Development dba Suntex Homes had any obligations under the Stipulation and Agreement, that Suntex had violated any ROC- related statute or rule, or that any Corrective Work Order had ever been issued against Suntex in this case.

CONCLUSIONS OF LAW 1. This matter is within the jurisdiction of the ROC pursuant to ARS §32-1104 and Title 4, Chapter 9, Article 1 of the Arizona Administrative Code. 2. The burden of proof generally at an administrative hearing falls to the Complainant. Culpepper v. Arizona Board of Nursing, 187 Ariz. 431, 930 P.2d 508 (App. 1997). Further, the standard of proof at hearing is by a “preponderance of the evidence”. Smith v. Arizona Department of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). Complainant has sustained/failed to sustain the burden of proving, by a preponderance of reliable, substantial and probative evidence, that Respondent violated ARS §32-1154(A). 3. Construction and installation work, such as that at issue in this case, is not an exact or perfect science. It is not uncommon in the industry to have corrections, repairs, and replacements of resultant poor workmanship, mistakes or miscalculations made prior or subsequent to completion of a particular project in order to bring the final work product up to appropriate industry standards. In this regard, a contractor should be given a reasonable opportunity to complete necessary remedial work. See ARS §32-1154(A)(23). 4. The testimony of the ROC inspector and his opinion regarding whether or not the various items at issue met all applicable industry standards in terms of workmanship, construction and installation is telling. In cases such as this, the skill and expertise of the ROC Inspector who is professionally skilled and knowledgeable of the standards imposed by the ROC (as opposed to the standards adopted by other construction or manufacturing industry groups or associations, or the standards of the Complainant) must be afforded a certain deference. It is obvious to this tribunal that Complainant’s standards have not been met by the Respondent; however, it is the ROC’s standards that apply in this case, and not Complainant’s own sense of aesthetics. 5. Access to the property on which corrective work is to be conducted is integral to the entire ROC remedial and enforcement process. A contractor has the right, in the face of an ROC Complaint and Citation, to an opportunity to conduct remedial work to correct deficiencies in previous work. Denial of access to the property denies the contractor of that opportunity, and is tantamount to denial of the right to make remedial corrections. Accordingly, denial of access can be treated as compliance with a given Corrective Work Order, or as in this case, the Stipulation and Agreement. Mrs. Novak’s insistence that the workers Mr. Holmes hired to conduct the repair work in her home with proof of their licensure with the ROC (which they obtained), and then her unavailability to allow them access to her home a scant two hours before the ROC inspection, when she knew the crew was going to return to conduct the repair work prior to the inspection, constituted unreasonable denial of access. The date for repair was specifically scheduled to allow the ROC inspector an opportunity to observe the truss repair before access to the repair site was covered with drywall. Mrs. Novak’s actions frustrated that schedule, and it is this tribunal’s opinion that Mrs. Novak did it deliberately in order to be able to claim to the ROC inspector and this tribunal that Respondent did not complete the truss repair. Nonetheless, Respondent stands ready and willing to complete the truss repair at a future date.

RECOMMENDED DECISION In view of the foregoing, it is recommended that the ROC take no action against Respondent Suntex Homes, and that the compliant against it be dismissed. It is further recommended that no action be taken against Respondent Caliber Holdings Company LLC and that the instant complaint against it be dismissed; however, that in light of Respondent’s continued willingness to complete the truss and associated drywall and painting repairs, despite its earlier frustrations in doing so, that Complainant be afforded one single opportunity to set a date mutually agreeable to both parties for repair of the trusses, and that if Complainant fails to provide reasonable continued access to their home in the timeframes necessary to complete the repairs as estimated and set forth in the Finding of Fact above, that this case be dismissed in it’s entirety, and that Respondent be absolved of any further liability or obligation under the Stipulation and Agreement dated 4 December 2006, and the Corrective Work Order dated 31 August 2006. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order in this matter will be forty (40) days from the date of that certification.

Done this day, July 2, 2007

______________________________________ Maurice McWhirter Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2007, to:

Fidelis V. Garcia, Director Registrar of Contractors Legal Department 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________ -----------------------

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