ALJDEC decisions subject to certification as final

07F-2127-ROC · Registrar of Contractors · 2008-06-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 25, 2008

APPEARANCES: Complainants were represented by their attorney, Daniel Kloberdanz and Respondent appeared through its owner and qualifying party, Charles Contreras (“Contreras”).

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, Complainant’s general contractor retained Respondent to accomplish specified tile work on the new home construction project. Complainant alleges certain deficiencies in the work performed 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. Walter Kabat (“Walter”) appeared at the hearing and provided testimony. He testified that Respondent began work on the project in the early part of 2006, performing tile installation on the interior and exterior of the home. The only issue at the instant hearing involves the exterior tile installed for the deck in the rear yard of the home. b. According to Walter, the cost for the rear yard deck tile installation was approximately $37,000.00. c. Walter testified that Complainants experienced numerous delays in getting Respondent to complete the project and to accomplish specified remedial work on the tile installation. d. Canterra stone is the type of material that was installed on the rear yard deck. e. Evidence of record showed that Complainants sent Respondent several facsimile transmissions on or about October 2006, in order to have the project completed and/or corrected. Finally, on or about November 2006 a Building Confidence inspection was conducted by an assigned inspector for the Registrar of Contractors. A copy of this inspection report was entered into evidence, as part of Complainants’ exhibit no. 1. A review of said report shows that the inspector found “cracked tile that require replacement, lippage beyond 1/32, and non-uniform grout lines.” According to this report, the items in question did not meet Registrar of Contractors’ workmanship standards. f. Subsequent to completion of the above-described Building Confidence inspection, Walter commenced another facsimile campaign to Respondent, urging Respondent to correct the determined deficiencies in the Building Confidence report. Complainants’ general contractor was included in these facsimile transmissions. g. Although Respondent contends that some degree of remedial work was performed, Walter testified that the issues in the deck installation were not resolved. Finally, on March 19, 2007 Complainants filed the instant Complaint with the Registrar of Contractors. h. Subsequent to receipt of the filed Complaint, the matter was assigned to one of the Registrar’s inspectors. The inspector was the same inspector that conducted the aforementioned Building Confidence inspection in November 2006. After receipt of the filed Complaint, the inspector convened another jobsite inspection. i. The formal jobsite inspection resulted in the issuance of a Corrective Work Order (“CWO”). A copy of the CWO was entered into evidence as Complainants’ exhibit no. 11. The CWO reveals that the inspector again found deficiencies in Respondent’s work on the project and thus, ordered Respondent to correct the tile lippage which was greater than 1/32, replace the cracked tiles, and to correct grout joints which were not uniform in width. Respondent was required to accomplish the ordered remedial work within a stated period of time. j. Notwithstanding the terms of said CWO, Respondent failed to comply with same. Contreras testified that he did not agree with the findings of the inspector and contacted the inspector to express his disagreement with his findings. k. After issuance of the CWO, Complainants again sent a facsimile transmission to Respondent, requesting that the work set forth in the CWO be accomplished. Finally, after receiving no response to their requests for corrective work, Complainants hired others to repair the exterior tile deck installation. Walter testified that he paid the subsequent contractor $49,307.50 to correct the deck. This work required installation of new tile over the existing tile. Complainants did not present any other bids in this regard. l. Brian Harding (“Harding”) appeared and testified for Respondent. According to Harding, Canterra stone is a very irregular material. He testified that he did repair the lippage issues, at one point in time, before the issuance of the CWO. He admitted that he did not return to the project after the CWO was issued by the assigned inspector. m. Jason Klein (“Klein”), Respondent’s superintendant on the project, appeared and presented testimony. According to Klein, Walter requested an unusual pattern or layout for the tile and this design is responsible for the cracking of the tiles and inconsistency in the grout joints. Notwithstanding Klein’s contention that Walter was advised of the potential for problem with the tile pattern he requested, no written waiver or disclaimer was ever issued. n. Contreras also testified that Walter was warned of the potential grout joint issues that would arise, due to his design. He also indicated that there is a significant outstanding final payment on the contract that has not been paid. In this regard, Respondent has filed a lien on Complainants’ property. o. Walter denies ever receiving any warning of the potential problems with the requested design for the tile installation.

3. Respondent accepted the tile project, as designed by Walter. The weight of the evidence of record supports a finding of substandard and unacceptable workmanship by Respondent on the rear yard tile installation, as manifested by excessive tile lippage, cracked tiles, and non-uniform grout joints, creating not only a breach of the implied warranty of fitness for aesthetic purposes but also an unworkmanlike result.

4. It is determined and held that Respondent, by virtue of agreeing to install the tile deck, as directed by Walter, effectively accepted the materials and conditions as being adequate to support a workmanlike result and, as such, is estopped to assert that it has no responsibility for the deficiencies in the tile installation. In the event that a contractor believes that there will be problems and/or issues with the work requirements and/or dictates of a homeowner, then it is incumbent upon the contractor to either refuse to perform said work or issue an effective written and signed disclaimer or waiver, which must be signed by the homeowner.

5. The substandard work on the tile project is also found to constitute a wrongful act, within the meaning of the applicable charged section of the State’s Contracting laws.

6. By its failure to comply with the CWO, Respondent is found to have violated the applicable charges provision of the State’s Contracting laws, regarding the need to comply with an official Agency directive.

7. Without any presentation of competitive bids and testimony from the replacement contactor, the instant record is found to be inadequate to support any Order providing for restitution. Ordering restitution is a matter of discretion in administrative proceedings. The instant matter is an administrative, license disciplinary proceeding relating to a contractor’s license. The Registrar’s role in this matter is not one of a collection agency or judicial tribunal, but merely one duty-bound to determine whether a violation of this State’s contracting laws has occurred and, if so, impose a proper disciplinary sanction. Neither the filing of a complaint with the Registrar, nor a demonstration that a contractor violated state law, vests in a Complainant the right to receive any particular individualized relief or an order imposing any particular discipline.

8. 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 that the instant Complaint was the only complaint on the Registrar of Contractors’ current record regarding Respondent. Therefore, Respondent’s prior record is properly deemed to be excellent and thus, is viewed as a matter in mitigation 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 (23), (7), and (3); namely Rule R 4-9-108.

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 C-48 license of Respondent shall be placed on suspension for three (3) days, followed by a period of disciplinary probation for 137 days. It is further recommended, in addition to the above-provided penalties, if any, that Respondent pay the sum of $150.00 to the Registrar of Contractors by way of a civil penalty pursuant to A.R.S. §32-1154D. The failure by Respondent to pay the entire amount of the aforesaid civil penalty, on or before 30 days following the effective date of the Order entered in this matter, shall result in the automatic revocation of Respondent’s contractor’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. §32-1101A(5), unless payment of any outstanding prior civil penalty is tendered. 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, June 25, 2008.

______________________________________ Mark A. Silver Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2008, to:

Registrar of Contractors Fidelis V. Garcia 3838 N. Central Ave., Ste. 400 Phoenix, AZ 85012-1906

By ___________________________

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