ALJDEC decisions subject to certification as final

07F-F0198-ROC · Registrar of Contractors · 2008-10-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 22 and September 29, 2008 APPEARANCES: Complainants appeared on their own behalf and Respondent appeared through its member, David Good, on the first day of hearing. On the second day of hearing Respondent was represented by its attorney, Justin Vaughn. 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 accomplish new home construction. Complainants allege certain deficiencies and irregularities in the work performed and/or materials provided by Respondent and same are discussed in the findings below.

2. At the outset of the scheduled hearing, Complainant averred that the issues of the lippage on the garage floor, ponding water on the southwest observation deck, damage to screens, water leakage on the shed roof, and the twist on the exterior beams had either been resolved by Respondent or accepted by Complainants. Therefore, these issues were not part of the items litigated at the instant hearing.

3. During the course of the hearing, the parties were able to reach a settlement on three of the remaining issues litigated at the hearing. The agreement between the parties included the following:

a. Regarding the “screening” of the roof air conditioners, Respondent agreed to install a “pre-stuccoed” and pre-finished plywood façade, to hide the sight of the air conditioners from the ground level. The screen will be painted to match, as close as possible, the color on the exterior of the home. The assigned inspector for the Registrar of Contractors agreed, upon proper notice from the parties, to come to the jobsite and lend his opinion on the project. b. In regard to the “peeled pole” log inside the residence, Respondent agreed to stop the movement of the log in a proper workmanlike manner. c. Respondent agreed to pay the cost to have crushed granite delivered to Complainants’ home. The material is to be for the driveway and Complainants will sustain the cost to have the material spread (installed) in said area. The material will be a color described as “Apache Red” and enough material will be delivered to provide a nominal depth of 1.5 inches.

Respondent will be required to accomplish all of the above-described items on or before the effective date of the Order entered in this matter.

4. During the course of the instant hearing, Complainants were advised that their claims of forgery, consequential monetary damages, and failure by Respondent to pay specified taxes were not matters within the purview of the Registrar of Contractors, absent a prior ruling on said issues before the appropriate forum and/or court of law. Thus, these issues were not considered at the instant hearing and Complainants were advised that they could pursue the issues in another forum or court.

5. The assigned inspector for the Registrar of Contractors appeared at the instant hearing and testified regarding his findings on the issues presented in the filed Complaint. The salient portions of his testimony included the following:

a. After receiving the filed Complaint, the inspector conducted a jobsite inspection to determine if there were any Contracting law violations. b. Complainants contend that there is some type of gap under an “un- sheered” area of the stucco application. However, since the project was complete and the area totally covered by stucco at the time of the jobsite inspection, the inspector could not determine any violation on this issue.

c. There was an issue regarding specified missing door lock hardware. The inspector could not determine any violation in this regard, since all hardware was installed completely at the time of the jobsite inspection. d. The inspector observed that Complainants did not have stamped and stained concrete. Although Complainants contend they were entitled to receive such a treatment of their concrete, the inspector was shown what were purported to be the building authority approved plans and specifications and found that these items were originally set forth on said plans but were later crossed out. Thus, he could not determine any violation in this regard. e. The inspector testified that the Registrar of Contractors does not get involved in what rates a contractor may charge. Thus, he made no ruling on the issue of whether or not Complainants paid too much for their new home.

6. After concluding his inspections of the property, the inspector issued two Corrective Work Orders (“CWO”), on May 17 and June 20, 2007. Regarding the above-described settlement issues, the “peeled pole” log and the granite were both issues that were included on the respective CWO, requiring corrective action by Respondent. The issue of the “screening” of the air conditioner was an item that Respondent agreed to correct at the jobsite and thus, was ordered to be corrected by the relevant CWO. Notwithstanding Respondent’s agreement, at the hearing, to correct these issues, they remain as items of substandard and unacceptable workmanship, which should have been corrected prior to a hearing. In addition, the failure to correct these items constitutes a failure to comply with an official Agency directive.

7. David Schmittendorf (“David”) testified at the hearing and the salient portions of his testimony included the following:

a. According to David, he observed the home at various stages of construction. During the course of the stucco work, he observed that Respondent had left a ½ inch gap at the bottom of the walls. He contends that he told Respondent about this issue during construction and nothing was ever done about it. He is concerned that the gap allows insects to enter the home and also has a deleterious effect on the heating and air conditioning of the home. b. On the issue of the stamped and stained concrete, he asserts that Respondent improperly crossed out these provisions, without his permission or knowledge. Thus, he contends that he should have received these features. He admits that he saw the cross-outs on the plans that were on file with the building authority, but these official plans have since been destroyed by the building authority. c. David testified that the applicable contract provides that no changes can occur without his signature. Nevertheless, there was no showing that the applicable written contract provided for stamped and stained concrete.

8. Susanne Schmittendorf (“Susanne”) also testified at the hearing and in her testimony she indicated that she was on the jobsite on occasion and that she also observed numerous places were there were gaps in the walls for the house and the garage.

9. Complainants also called Steve Murphy(“Murphy”) as a witness. Murphy lives across the street from Complainants and works with his father in a construction business. A check of Registrar of Contractors’ records failed to show that Murphy appears on the license of his father, although he claims he is a partner in the business.

10. Murphy is not employed in the stucco business, but he claims that he has knowledge from his general contractor related experience as to stucco application requirements. Murphy testified that he and David brought the above-described gaps in the stucco system to the attention of Respondent and that they were advised these issues would be corrected.

11. Murphy acknowledged that he never spoke to the local building official, regarding his allegation that there were gaps in the stucco system, and he admits that he was not present for the stucco related inspection by the building authority official.

12. Respondent called Lester May (“May”), the stucco contractor utilized on the job, as a witness. The salient portions of May’s testimony included the following:

a. May has been a licensed stucco contractor since 2002 and has been employed in the stucco trade since 1995. b. The stucco work was inspected and passed by the local building authority. c. He acknowledged that Complainants showed him several areas of concern regarding gaps and that he placed additional stucco in these areas. He also testified that David wanted him to plug the holes in the weep screed and he advised David that to plug said holes would constitute a code violation.

13. George Good (“George”) appeared and testified for Respondent. The salient portions of George’s testimony included the following:

a. There was a money dispute and a complete breakdown in the working relationship between the parties near the end of the project. According to George, Respondent had installed the new door lock hardware on the home but on one occasion, when he returned to the jobsite near the end of the project, he had found that the door lock hardware had been replaced with used door lock hardware. He admits that Respondent removed the used door lock hardware, replaced same with new locks and took away the used door lock hardware. b. George testified that he changed out the used door locks so that Respondent would not be locked out of the project. After Complainants complained about the removal of their used door locks, instead of handing said locks over to Complainants, he testified that he left them at the “side of the road” by Complainants’ home. Nevertheless, David had testified that he never got these used door locks back. c. George testified that Respondent does not perform stamped or colored concrete work and that he advised Complainants of this at the time the applicable contract for the construction of the home was signed by him and Complainants. He pointed out that there is nothing in the written contract requiring Respondent to install stamped and/or colored concrete. Moreover, he indicated that the cross-out on the plans and specification regarding this provision was done at the time of signing the contract and in the presence of Complainants. d. He claims that he inspected the stucco application installed by May and saw no deficiencies in same. He also indicated that it is normal to have areas of air inside walls.

14. Greg Good testified that he was present when the contract was signed and recalls that Complainants were advised that Respondent does not perform stamped or colored concrete work. He also testified that Respondent removed the above-described used door locks because Respondent still had minor finish work to complete on the home and did not want to be locked out of the home.

15. David Good also testified for Respondent and indicated that all applicable inspections for the home were passed, including the stucco inspection.

16. Although Respondent believed that it had a right to enter the new home construction project, after Complainants had changed the locks, the utilization of self-help in this regard was improper. The replacement locks did not belong to Respondent and it had no right to remove said locks. Furthermore, once Respondent removed said locks, it was Respondent’s total responsibility to assure that the locks were safely returned to Complainants. Under all of the facts and circumstances presented herein, Respondent’s removal of Complainants’ replacement locks and the failure to assure that same were returned to Complainants’ possession is deemed to be a wrongful act, within the meaning of the applicable charged section of the State’s Contracting laws. The Registrar of Contractors, acting through an administrative license disciplinary hearing, is the inappropriate forum to place a value on the used locks. Thus, any claim by Complainants for monetary damages, in regard to the lost lock sets, must be brought before a civil court of competent jurisdiction.

17. The evidence presented was inadequate to support a finding that the applicable contract provided Complainants with any entitlement to stamped and/or colored concrete. Thus, Complainants failed to sustain the requisite burden of proof on this issue.

18. The stucco application by Respondent was shown to have passed all applicable local building authority inspections. The evidence presented by Complainants on this issue was not found to be adequate to overcome the presumption of good and proper workmanship on this issue by virtue of the fact that the stucco construction work passed the inspection of the local building authority. Thus, Complainants failed to sustain the requisite burden of proof on this issue.

19. 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), (2) 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 B license of Respondent shall be suspended until the Registrar of Contractors receives written proof that Respondent has properly complied with the provisions of 3(a) through 3(c), above. It is further recommended that if Respondent complies with the above- described condition 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 above-provided penalties, if any, that Respondent pay the sum of $200.00 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, October 6, 2008.

______________________________________ Mark A. Silver Administrative Law Judge

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

Registrar of Contractors Armando Contreras 3838 N. Central Ave. Phoenix, AZ 85012

By ___________________________

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