ALJDEC decisions subject to certification as final

07F-H0196-ROC · Registrar of Contractors · 2008-01-24

STATE OF ARIZONA IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 9, 2008 APPEARANCES: Complainant: John Ehlers appeared, pro per. Respondent: Respondent failed to appear either individually or by authorized representative or counsel. Registrar of Contractors: Inspector William Redman appeared on behalf of the Registrar of Contractors. ADMINISTRATIVE LAW JUDGE: Brian E. Smith _____________________________________________________________________ Evidence and testimony were presented and, based on the entire record in this matter, the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT 1. This matter convened for hearing via videoconference at the time, date and place set forth in this tribunal’s Order Granting Continuance dated October 1, 2007. 2. Complainant John Ehlers (“Complainant”) is the owner of a residence located at 8533 California Road, Kingman, Arizona (“premises/project”). 3. Respondent R and B Development (“Respondent”) is a sole proprietorship owned by Ronald Gene Healey[1] (“Healey”) who held and was the qualifying party for Arizona Contractor’s License No. 207266, Class B (General Residential) issued by the Registrar of Contractors (“ROC”) on May 7, 2005. A review of the licensing database maintained by the ROC indicates that this license was suspended June 1 -7, 2007 (non-renewal) and December 2, 2007 for lack of bond and was cancelled January 4, 2008 (qualifying party deceased). 4. Complainant filed a complaint with the Registrar of Contractors on November 2, 2006 wherein were alleged various construction problems with the residence including, without limitation, drainage, crack at end of driveway, inoperative sink in master bathroom and cracking/poorly patched drywall in guest bedroom. 5. Inspector William Redman (“Redman”) conducted a jobsite inspection on November 28, 2006 and issued a Corrective Work Order on December 1, 2006 wherein he directed Respondent to determine cause of garage flooding and repair. 6. On April 5, 2007, the Registrar issued a CITATION AND COMPLAINT in Case No. H07-0196 charging Respondent with possible violations of A.R.S. §32-1154A 2, 7, 23 and 3 (namely, R4-9-108, the workmanship rule). 7. Respondent filed an answer on April 19, 2007 wherein he asserted a general denial of all allegations and affirmatively alleged that Complainant had changed the grading by engaging the services of a landscaper. 8. At the hearing, Complainant testified and submitted Exhibits C-7, C-10 and C-14 though C-19 which were marked, admitted and considered. Bill Farmer (“Farmer”) also testified on behalf of Complainant. 9. Respondent failed to appear personally or through an authorized representative or counsel. 10. Inspector Redman testified on behalf of the Registrar of Contractors and described his observations and conclusions on his initial November 28, 2006 jobsite inspection and August 31, 2007 pre-hearing jobsite inspection. 11. Based on his initial jobsite inspection, Inspector Redman opined that the subject project was built four to five feet lower than it should have per the 1997 building code. Redman further related that at the time of construction there was no code inspection as the home was erected in an “overlay area” where the code was not enforced by any governmental agency. Notwithstanding such want of code enforcement, Redman testified that Respondent should have been aware of the code requirement that the premises be constructed at least two feet above the highest point of drainage on the road/gutter. 12. Redman further testified that, as of his August 31, 2007 pre- hearing jobsite inspection, Complainant had performed and/or caused to be performed extensive work to alleviate extensive flooding of the premises. 13. Complainant testified that there was no inspection of his premises at the time of purchase and that Respondent did not advise him of the code requirements and/or possible drainage problems at that time. 14. On more than one occasion Complainant experienced severe flooding into his garage with significant rains including the presence of one to two inches of mud which caused damage to his garage and house. 15. Complainant incurred $487.50 in costs to level and recondition the premises to alleviate and/or eliminate the flooding and drainage issues. (Exhibits C-15 and C-16) 16. Complainant also incurred $5,500.00 in costs to install concrete drainage, trench and grate in driveway and across garage apron to alleviate and/or eliminate the flooding and drainage issues. (Exhibit C-18) 17. Complainant further incurred $6,890.00 in costs to erect a two foot high block wall along the ditch in front of the premises to divert water run off from a neighbor’s property toward the next lot and swale adjacent to the subject project. (Exhibit C-19) 18. Additional remedial work was performed by another contractor on the swale adjacent to the subject premises to assist with drainage for which Complainant was not charged. 19. Complainant testified that following the construction of the above-reference remedial measures he has experienced no flooding or drainage problems as had previously occurred.

APPLICABLE LAW The CITATION AND COMPLAINT issued by the Registrar of Contractors in Case No. H07-0196 charged Respondent with possible violations of A.R.S. §32- 1154A 2, 7 23 and 3 (namely R4-9-108, the workmanship rule). Those statutory sections require that the holder of a license or person listed on the license shall not commit the following:

2. Departure from or disregard of plans or specifications or any building codes of the state or any political subdivision of the state in any material respect which is prejudicial to another without consent of the owner or his duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications code.

…

7. The doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured. …

23. Failure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving written directive from the registrar. The written directive shall set forth the time within which the contractor is to complete the remedial action. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive. A license shall not be revoked or suspended nor shall any other penalty be imposed for violation of this paragraph until after a hearing has been held pursuant to the provisions of this article. … 3. Violation of any rule adopted by the Registrar.

A.C.C. R4-9-108 is named as the rule violation charged pursuant to A.R.S. §32-1154A (3). Rule R4-9-108 provides that all work shall be done in a professional and workmanlike manner and in accordance with any applicable building codes and professional industry standards.

CONCLUSIONS OF LAW 1. The Registrar of Contractors has jurisdiction over this matter pursuant to A.R.S. § 32-1101, et. seq., which authorizes the Registrar to impose disciplinary sanctions against licenses for violations of A.R.S. § 32-1154. 2. To warrant such sanctions by the Registrar, Complainants must demonstrate by a preponderance of the evidence that Respondent violated any one, or more, of the statutory sections cited. Proof by a “preponderance” means that “the evidence is sufficient to persuade the finder of fact that the proposition is more likely true than not.” In re Arnold and Baker Farms, 177 B.R. 648 (9th Cir. BAP (Ariz.) 1994). See also, Culpepper v. State of Arizona, 187 Ariz. 43, 930 P.2d 508 (App. 1996). It is “evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (Rev. 6th ed. 1990). 3. The purpose of licensing Arizona contractors is to regulate the conduct of contracting and protect the public from unscrupulous acts. Beazer Homes Ariz., Inc. v. Goldwater, 196 Ariz. 98, 101, 993 P.2d 1062, 1065 (App. 1999); Better Homes Constr. v. Goldwater, 203 Ariz. 295, 300, 53 P.3d 1139 (App. 2002). The statutory purpose is to prevent unscrupulous or financially irresponsible contractors from deceiving and taking advantage of those who engage them to build. Sobel v. Jones, 96 Ariz. 297, 394 P.2d 415 (1964). 4. This tribunal determines and concludes that Complainant established by a preponderance of credible, probative and relevant evidence that Respondent failed to properly construct the subject premises in accordance with the applicable 1997 building code in violations of A.R.S. §32-1154A (2). 5. This tribunal further determines and concludes that Complainant established by a preponderance of credible, probative and relevant evidence that Respondent failed to properly construct the subject premises and/or remedy the improper construction as required by the Registrar of Contractors’ December 1, 2006 Corrective Work Order in violation of A.R.S. §32-1154A (23) and (3), Rule R4-9-108, respectively. 6. This tribunal further determines and concludes that the violations set forth in Conclusions of Law 4 and 5 above was wrongful and resulted in substantial injury to Complainants. Therefore, a violation of A.R.S. §32-1154A (7) has been proven as cited. 7. It is further determined and concluded that Complainant established by a preponderance of credible, probative and relevant evidence the right to restitution in an amount not less than $12,877.50, the reasonable charges incurred by Complainant for retention of other contractors to perform remedial work on the premises to alleviate and/or eliminate drainage problems caused by Respondent’s construction work.[2] 8. This tribunal also determines and concludes that the weight of credible, probative and relevant evidence established that Respondent failed to act in good faith during and subsequent to performing his work on the project as evidenced by his failure to take any corrective action in response to the instant Corrective Work Order which shall serve as a factor in aggravation in this matter.

RECOMMENDED ORDER On the basis of the foregoing, IT IS RECOMMENDED that commencing on the effective date of the Registrar’s Order entered in this matter, the Class B license of Respondent be revoked.[3] Done this day, January 24, 2008.

________________________ Brian E. Smith Administrative Law Judge

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

Registrar of Contractors Fidelis V. Garcia 3838 N. Central Ave. Phoenix, AZ 85012

By _________________________ ----------------------- [1] Mr. Healey passed away November 20, 2007. [2] Complainant asserts that he incurred additional costs of $6,291.20 (Exhibit C-17) to enclose the premises’ front entry way. However, Complainant testified that such work constituted “preventative measures” for possible flooding but did not actually divert water away from the premises. As a result, this tribunal determined and concluded that such cost should not be included in any restitution amount awarded. [3] 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.

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