ALJDEC decisions subject to certification as final

07F-M2027-ROC · Registrar of Contractors · 2009-02-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: February 4, 2009 APPEARANCES: Ken McCain, Esq. represented Complainant Janice Dulmer. Greg Cahill, Esq. represented Respondent Spectre West Builders Corporation. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Respondent Spectre West Builders Corporation (“Spectre”) is subject to discipline for acts or omissions in violation of A.R.S. § 32-1154(A). Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order: FINDINGS OF FACT Spectre is the holder of a Class B- license (No. 088600) issued by the Registrar of Contractors (“ROC”). On or about February 5, 2005, Complainant Janice Dulmer purchased her condominium from Spectre. See Exhibit R-6. Spectre is the general contractor that constructed the condominium. Ms. Dulmer moved into her home on or about June 27, 2005. In or about September 2006, pursuant to the terms of her purchase agreement, Ms. Dulmer requested an arbitration be scheduled through the 2- Home Buyers Warranty regarding tile and grout issues in the kitchen, master bathroom, guest bathroom, and foyer, as well as complaints regarding the inadequacy of the air conditioning system in the guest bedroom, laundry room, and master bathroom, and a complaint that the air conditioning unit is extremely loud inside the home. See Exhibit F. On October 19, 2006, an Arbitration Award was issued finding Spectre to be responsible for repairing some of Ms. Dulmer’s complaint items. See Exhibit R-7. On February 26, 2007, an Amended Award was issued clarifying the original Award. See Exhibit R-8. On April 3, 2007, Spectre filed a notice of compliance with the 2-10 Home Buyers Warranty, indicating that it had completed the work per the Arbitration Award. See Exhibit R-9. On July 15, 2007, the Arbitrator issued a Compliance Inspection Report, indicating that he had conducted a compliance inspection on July 13, 2007, and found Spectre to be in compliance with the Arbitration Award and Amended Award, and this “constitutes my complete final and binding AWARD as to all items in dispute submitted to me for determination.” (Emphasis in original). See Exhibit R-10. On or about April 17, 2007, Ms. Dulmer filed a complaint against Spectre with the ROC alleging the following in pertinent part: Cooling and heating system does not adequately heat and cool the living space. I had an arbitration hearing through the 2-10 Warranty Company and an award date 10/19/06. The following quote from the award (see attached) states “Inadequate design/means provided by the builder to satisfactorily balance the cooling system with an acceptable range. Also, the airflow is exceeding normal operating conditions causing excessive noise throughout the home.[“] The builder had the system evaluated by an outside contractor, however, he has not repaired the system according to the findings on his own outside contractors (sic) report. After several attempts by the (sic) Spectre West the airflow design issue still exists. I have had a Home Building Inspector, SRP and other contractors who have evaluated the system and determined that the mechanical plans submitted and approved to the City of Apache Junction do not match what was constructed in my unit. Running field changes were made by the builder and the air conditioning sub contractor A & A Heating and Cooling. Some experts believe that these changes contributed to the inadequate design issue as the plans/modifications were never re-submitted to the City of Apache Junction for approval for the planning inspector. Therefore, my unit was not built to plan. This conflict has been going on since 6/27/05 during my walk through and I was told it was a minor adjustment.

The contract between Spectre West and myself states that changes can be made. However, in the event of a conflict between the floor plans, and the plans, the details of the plans as filed with the county or municipality in which the project is located, shall control. Most experts that I have talked with agree that a builder who makes changes to the plans without proper city approval would be a fairly serious violation. A copy of the plans are on file with Spectre West builders. The super Tom Collins of Spectre West has stated that the running field changes were verbally approved by the City of Apache Junction. No written changes are on record. After all of the attempts the air conditioning/heating systems were never properly balanced. My home persists with inadequate cooling and heating. The arbitration award clearly requires the builder and air conditioning sub contractor to provide satisfactory balance of the cooling system within an acceptable range. There has been no attempt made regarding balance of the system.

See Exhibit R-1 During the course of the hearing, Ms. Dulmer withdrew her complaints regarding the tile and grout issues. Accordingly, those issues are not addressed further herein. ROC Inspector Beau Cruz investigated Ms. Dulmer’s complaint. On or about May 8, 2007, Inspector Cruz conducted a jobsite inspection. On May 22, 2007, following the jobsite inspection, Inspector Cruz issued a letter to the parties advising of the following: Upon filing a complaint with this agency it is incumbent upon the complainant to show proof of violation by a contractor. This agency cannot request a citation against a contractor’s license unless sufficient evidence is submitted or otherwise obtained to justify such action. Therefore, it appears appropriate that we close your complaint for the following reason(s):

Complaint 1) A/C system does not adequately heat and cool the living space: Complainant attempted to demonstrate at jobsite. This inspector tested unit at 76 to 78 degrees Fahrenheit and unit cooled according to ROC standards.

Complaint 2) Airflow from the A/C unit exceeds normal operating condition, causing noise throughout the living space: Complainant stated that wall registers where (sic) changed and that air flow has improved, noise level lessened and also HVAC contractor and Mr. Schoffstall both adjusted registers at jobsite and both agreed that airflow has been improved. In this inspectors (sic) opinion airflow was present at all registers and contractor and Mr. Schoffstall agreed, although Mr. Schoffstall expressed reservations about airflow in the living room area. Noise level at the time of the inspection was in this inspector’s opinion normal for this type of HVAC unit. It should be noted that the ROC workmanship standards does (sic) not specifically address noise level limits with HVAC systems, although inspectors can submit opinions.

Complaint 3) HVAC ductwork system do (sic) not match architectural plans submitted by builder to the City of Apache Junction: Complainant provided copy of unstamped architectural mechanical building plan that did not match with final installation. Contractor (Spectre West) provided written change request from HVAC contractor and signed letter from building inspector authorizing field change.

Complaint 4) Running field changes made to the HVAC system that where (sic) not submitted or approved by the City of Apache Junction: Complainant provided copy of unstamped architectural mechanical building plan that did not match with final installation. Contractor (Spectre West) provided written change request from HVAC contractor and signed letter from building inspector authorizing field change.

Complaint 5) Chipping and deterioration of the tile grout in the kitchen: Chipping present is consistent with age of grout and the traffic area.

Complaint 6) Chipping and deterioration of the tile grout in the master bathroom: Two tiles that where (sic) pointed out to this inspector, have been regrouted in March 2007 and complainant is satisfied with outcome.

Complaint 7) Chipping and deterioration of the tile grout in the guest bathroom: Chipping present is consistent with age of grout and the traffic area.

Complaint 8) Chipping and deterioration of the tile grout in the foyer: From conversation with complainant and contractor this area was addressed in 2005 and complainant is satisfied with outcome.

See Exhibit R-2. 13. Inspector Cruz did not conduct a pre-hearing inspection because he did not issue a Corrective Work Order to Spectre. Inspector Cruz testified consistently with the findings contained in his May 22, 2007 letter. Inspector Cruz testified that there is no ROC standard for noise level, and that in his opinion, the unit was not excessively noisy. Inspector Cruz further testified that Spectre provided proof that it obtained approval from the city inspector in the field for the changes made to the system, and that the “as built” complies with code. Inspector Cruz testified that he took temperature readings throughout the home, and specifically where Ms. Dulmer requested, and that the unit was cooling sufficiently. Inspector Cruz testified that he is a former HVAC contractor, and as such, his opinion regarding HVAC issues should bear weight. Inspector Cruz testified that the unit is operating appropriately, however, he did not measure airflow. Inspector Cruz testified that he found no violations of ROC standards. 14. Ms. Dulmer testified that during the walk through she advised Spectre that there was an issue with the air conditioning in the guest bedroom. Spectre adjusted the registers, however air flow was not adequate in the front portion of the home, the bathrooms, laundry room, and living room. Spectre performed some work to the system, however, Ms. Dulmer remained dissatisfied. Ms. Dulmer also noticed that the register in the living room was missing, and other registers were not in the areas depicted on the plans. When she reported this to Spectre, Spectre advised her that the plans were changed and approved in the field. 15. Ms. Dulmer testified that a noise generates from the return vent in the hallway and sounds like a loud motor. Ms. Dulmer acknowledged that she was able to replicate the noise during the jobsite inspection for Inspector Cruz, and that he did not find the unit to be excessively noisy. Ms. Dulmer further acknowledged that she spoke to the city inspector and that he did not deny making the field change. 16. Ms. Dulmer testified that she was “unhappy” with the results of the Arbitration, and as such decided to file a ROC complaint and proceed to administrative hearing. The Administrative Law Judge finds, based on the credible, substantial, and probative evidence presented at hearing, that the complaint items contained within Ms. Dulmer’s ROC complaint were adjudicated by a final and binding arbitration that she requested. 17. Ms. Dulmer hired Omega Test and Balance, L.L.C. (“Omega”) to evaluate the HVAC system. Chuck Schoffstall, owner of Omega, testified telephonically regarding the findings contained in Omega’s report. See Exhibit A. Omega took air flow readings throughout the home, and the air flow within the living space is within industry standards. Mr. Schoffstall testified that an outside air duct was not installed per plans, however, this is not uncommon in residential construction, and this does not impact the system. Mr. Schoffstall testified that the register installed in the kitchen is in a different location than as specified on the plans, however, this does not change the air flow and has no impact on the operation of the system. There is no register in the living room, and Mr. Schoffstall opined that this condition is causing lower airflow. However, photographic evidence submitted by Ms. Dulmer depicts that the living room and dining room are basically one large area without separation. See Exhibits C, D, and E. Mr. Schoffstall testified that the unit and ductwork are installed professionally and within workmanlike standards. Mr. Schoffstall further testified that he was unaware of the field changes and was not privy to the “as built” plans, nor did he view the city approved plans. Mr. Schoffstall also did not perform a temperature test in each room. 18. Tom Collins, construction supervisor for Spectre during the construction of Ms. Dulmer’s home, testified at hearing. Mr. Collins testified that he was personally present when the field change to the HVAC system was submitted to the city inspector for approval, and that it was approved. Spectre submitted into evidence a copy of a memo dated November 17, 2004 from Spectre’s HVAC contractor, A & A Cooling, stating in pertinent part the following: Per our discussion, I believe its (sic) necessary to modify the supply register to the living room. Placing the register at the end of the drop will elimanate (sic) an additional 11’ of air travel and (3) 90 degree turns. This will also provide better air flow to bedroom 2.

See Exhibit R-3. There is a hand written notation on the memo that states “Tom has talked to the city and they are ok with it.” Id. Attached to the memo is an email dated May 4, 2007, from Fred Klinger, the Building Inspector for the City of Apache Junction, that states the following: Re: Spectre West project heating/ac ducts I remember a conversation with Tom (owner’s supervisor on the site) that they were going to change subs before the start of building the second unit. Since Spectre West was both owner and builder of the project, any changes made by them on interior items I considered a field change and approved it if it met code.

Id. 19. Mr. Collins testified that the field change was made to avoid the installation of three elbows that would have inhibited air flow. The change was made to increase the performance of the HVAC system. Mr. Collins further testified that Omega’s test results are flawed in that Omega treated the dining room and living room as two separate areas, however, there is no separation between the areas and they comprise one open area. CONCLUSIONS OF LAW In this proceeding, Ms. Dulmer bears the burden to prove, by a preponderance of the evidence, that Spectre is subject to discipline for violations of A.R.S. § 32-1154(A)(2), (A)(3), and/or (A)(7) as charged by the ROC in its August 28, 2007 Citation and Complaint. See Arizona Administrative Code (“A.A.C.”) R2-19-119. A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). At the outset of the hearing, the parties presented argument regarding the Arbitration. Spectre argued that all of Ms. Dulmer’s complaints addressed to the ROC were addressed in the binding Arbitration Award. Ms. Dulmer argued that compliance with the construction performance standards encompassed by the 2-10 Warranty are not the same as the workmanship standards promulgated by the ROC. The Administrative Law Judge determined that a full hearing on the merits was appropriate. After the presentation of Ms. Dulmer’s case, Spectre made a motion to dismiss. The Administrative Law Judge denied the motion, again ruling that a full hearing on the merits was appropriate. Having now considered the complete evidentiary record, the Administrative Law Judge concludes that Ms. Dulmer failed to establish any difference in standards between those required by the 2-10 Warranty Company and those required by ROC workmanship standards. Ms. Dulmer further failed to establish that any of the items enumerated in her ROC complaint were different or additional to those adjudicated in the Arbitration. Further, for the reasons set forth below, the Administrative Law Judge concludes that Ms. Dulmer failed to establish any violations of this State’s contracting laws by Spectre. Under A.R.S. § 32-1154(A)(2), a contractor is subject to discipline for “departure from or disregard of plans or specifications or any building codes . . .” The Administrative Law Judge concludes, based upon the credible evidence of record, that Ms. Dulmer failed to establish that Spectre departed from or disregarded plans or specifications or any building codes, as the field change was approved by the city inspector and the “as built” is code compliant. Therefore, the Administrative Law Judge concludes that Spectre did not violate A.R.S. § 32-1154(A)(2). Under A.R.S. § 32-1154(A)(3), a contractor is subject to discipline for “violation of any rule adopted by the registrar.” In this case, the ROC charged Spectre with a violation of A.A.C. R4-9-108, which, among other things, requires contractors to perform work in a professional and workmanlike manner and in accordance with any applicable building codes and professional industry standards. The Administrative Law Judge concludes, based upon the credible evidence of record, that Ms. Dulmer failed to establish that Spectre failed to perform its work at her home in a professional and workmanlike manner. Therefore, the Administrative Law Judge concludes that Spectre did not violate A.R.S. § 32-1154(A)(3). Under A.R.S. § 32-1154(A)(7), a contractor is subject to discipline for “the doing of a wrongful or fraudulent act . . . as a contractor resulting in another person being substantially injured.” The Administrative Law Judge concludes, based on the weight of the credible evidence presented at hearing, that Ms. Dulmer failed to establish that Spectre committed wrongful or fraudulent acts that substantially injured her. Therefore, the Administrative Law Judge concludes that Spectre did not violate A.R.S. § 32-1154(A)(7). The Administrative Law Judge concludes, based upon the weight of the credible evidence of record, that no grounds exist to impose discipline against Spectre’s license. The ROC’s Citation in Case Number M07-2027, and the Complaint upon which it is based, should be dismissed. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order: It is recommended that no discipline be imposed against Spectre’s license, and that the Citation issued in Case Number M07-2027, together with the Complaint upon which it is based, be dismissed. 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 will be 40 days from the date of that certification. Done this day, February 23, 2009.

______________________________________ Sondra J. Vanella Administrative Law Judge

Original transmitted by mail this ____ day of February, 2009, to:

William A. Mundell, Director Registrar of Contractors Legal Department 3838 North Central Avenue Phoenix, AZ 85012

By ___________________________

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