ALJDEC decisions subject to certification as final

08F-2169-ROC · Registrar of Contractors · 2008-12-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: December 9, 2008 APPEARANCES: Mark Becker, Complainant; Jonathan Hille, Respondent’s representative; Tim O’Neill, Complainant’s witness; Jeff Fleetham, Registrar of Contractors Inspector ADMINISTRATIVE LAW JUDGE: Dorinda M. Lang _____________________________________________________________________ Following a complaint filed with the Registrar of Contractors, the Complainants have established that the Respondent violated relevant portions of the applicable law governing Arizona contractors. The nature of the violations and the relative harm to the Complainants, as well as the Registrar of Contractors’ interest in protecting the public, justifies the imposition of disciplinary action by the Registrar in the form of revocation of the Respondent’s license. In accordance with the following Findings of Fact and Conclusions of Law, the undersigned Administrative Law Judge hereby issues her Recommended Decision in the above matter to the Registrar of Contractors. FINDINGS OF FACT 1. On or about August 20, 2006, the Complainants contracted with the Respondent for landscaping, hardscaping and lighting to be installed in and around their home. The Respondent last performed work on the project in August 2007. The Complainants experienced various problems with the project, which the Respondent did not correct. 2. On February 1, 2008, the Complainants filed a complaint with the Registrar of Contractors regarding the Respondent’s work. Complainants requested that the Respondent reimburse them for the costs of correcting the damaged and problematic areas. Specifically, the complaint alleged the following items at issue:

1) Water comes into the house at all areas where there are doors with no overhangs – the contractor covered up all the weep screeds in these areas

2) Landscaping was built contrary to civil plan so that drainage in most areas is towards the house rather than away

3) Hardscape was installed too high and without proper drainage away from the house.

3. On March 13, 2008, Registrar of Contractors Inspector Jeff Fleetham conducted an initial job site inspection. He found that all the items of complaint were either corrected or in the process of being corrected by other contractors. Mr. Fleetham was unable to determine whether the Respondent had committed a violation of the relevant statutes and rules by observing the job site; therefore, on March 20, 2008, he informed the Complainant that the complaint was being closed. On March 31, 2008, the Complainants requested a hearing in the matter. 4. On May 8, 2008, Mr. Fleetham issued Respondent a letter stating that the Registrar of Contractors had received information that Respondent was operating under the name of Beam Luxury Construction. The letter warned the Respondent that it must operate and do all of its business under the name on its license, which is Beam Lighting and Construction, Inc. The letter noted that failure to do so was a violation of A.R.S. § 32- 1154(A)(3) and A.A.C. R4-9-109 and that the Registrar of Contractors can seek disciplinary action against it. The letter recommended that the Respondent resolve the matter by operating only under its licensed name in the future or requesting a formal name change with the Licensing Department. 5. That same day, May 8, 2008, Mr. Fleetham issued a second letter to the Respondent regarding the display of its license number. The letter purported simply to inform the Respondent that A.R.S. § 32-1124(B) set forth the requirements for the manner and location that every licensed contractor must display its license number. 6. Mr. Fleetham also issued a third letter to the Respondent on May 8, 2008. It informed the Respondent that the Registrar of Contractors had received information that Respondent’s contract may not comply with A.R.S. § 32-1158 in that it may not have contained all of the minimum elements of a contract required thereby. The letter warned the Respondent that failure to include the information in its contracts may cause disciplinary action to be taken against the Respondent’s license. 7. On September 26, 2008, the Registrar of Contractors issued a Citation and Complaint directing the Respondent to file a written answer within 15 days of mailing. On October 10, 2008, the Respondent filed an answer denying any violation of the statutes and rules designated on the Citation and Complaint. 8. The matter was set for hearing on December 9, 2008 at the Office of Administrative Hearings, an independent agency authorized to conduct hearings in contested matters arising out of State regulation. Both parties were represented at hearing. 9. The evidence and testimony adduced at hearing established that the Respondent contracted to install brick patios at several places around the home. The contract called for the Respondent to do the grading necessary to complete the job, and the Respondent had the plans available to it before and during the project. Although the plans called for the grading to slope away from the home, the Respondent’s work allowed rain to drift toward the home. Additionally, the grading was so high that the front door stoop was higher than the entryway and there was insufficient clearance below the weep screeds to prevent water damage to the home. As a result, the Complainants experienced significant flooding in their home and water damage at the base of their walls where water collected behind the stucco and was unable to evaporate through the weep screeds. 10. While viewing photographs of the project that were taken before the repairs were made, Mr. Fleetham noted that the stucco met the hardscape on the patios that Respondent installed. He stated that workmanship standards require at least two inches of clearance between the weep screeds and the hardscape and at least four inches of clearance between the weep screeds and the finished grading. He stated that this is the responsibility of the grader, who must ensure the proper clearance after the stucco is installed. He stated that the lack of clearance between the weep screeds and the patio as represented in the photos at hearing did not meet minimum workmanship standards. Failure to meet the standards, he said, would result in moisture building up in the walls, often causing water damage to the base of the walls or in the drywall. 11. Tim O’Neill, a civil engineer since 1969, who works for O’Neill Engineering, LLC, testified on behalf of the Complainant. He pointed out that the plans, which were in demonstration at the hearing, called for a four inch drop from the interior of the home to the outside, while the photographs of the Respondent’s work showed that it was almost level and, in at least one entry, there was even a step down coming into the home. He also pointed out where the plans called for a 1% slope away from the home to retention basins on the property. He also pointed out that the plans were consistent throughout in that regard. In viewing the photos of the Respondent’s work and the project before the repairs were made, he found that the grading had not been done to the plans’ specifications. While noting that the weep screeds were covered improperly, he believed that most of the damage had come from water draining toward the house. Nevertheless, he acknowledged that the weep screeds would cause damage to the home as well. 12. In order to mitigate the continuing damage to the home, the Complainants had the work repaired. They are seeking $39,027.28 in repair costs. Complainant Mark Becker testified that the home was flooding badly, with a half inch of water on the children’s room floor at one point. He offered testimony and photos showing that the interior tile and walls had been soaked with moisture in many areas. He also testified as to his attempts to have the Respondent repair the work. When the Respondent would not return, the Complainants hired contractors to repair the work in the most economical manner they could, leaving the weep screeds covered in areas that were protected by outdoor roofing (since the roofing might keep out moisture anyway) and filling a trellis so that it blocked infiltration of water toward the house. Mr. Becker submitted evidence of the costs of the repairs in the amount of $39,027.28, including an air pollution fine from Maricopa County in the amount of $8,500.00. 13. Respondent’s Qualifying Party, Jonathan Hille, denied responsibility for the problem. He stated that a back patio already had concrete near the weep screed and the Complainants wanted all areas to be level, so the Respondent installed them all at that height. He stated that he was trying to accommodate his customer. 14. Mr. Hille testified that some doors don’t have conventional weather-stripping, so they may be letting water in the home. He also argued that Paradise Valley’s building codes require a stoop if there is a step-down from the home. Since the plans did not call for stoops, he argued, he was required to make the grading higher to meet the code requirement. He argued that the plans were inconsistent, but he did not show where there was any inconsistency on the plans that were present at hearing. He also argued that it was inconsistent that the Complainants still don’t have weep screeds in some areas. 15. Mr. Hille stated that there was still an unpaid balance on the project of $7,592.93. He also argued that the air pollution fine was the responsibility of the general contractor, which was the Complainant in this case. 16. The Complainant argued that they had agreed that the account was settled despite their differences and the Respondent had been paid in full.

17. Since the air pollution fine was not a part of the complaint, no conclusions are made regarding whether it constitutes a violation in this recommendation. Additionally, no evidence was presented regarding the sufficiency of the contract, the Respondent’s use of the correct name or the display of Respondent’s license number. Therefore, the Administrative Law Judge will make no conclusions regarding those issues. 18. According to the records of the Registrar of Contractors, the license in this matter is a dual landscaping and irrigation systems license, which was issued in October 2003. It has 5 open complaints against it and 3 complaints that have been closed as resolved/settled/withdrawn. It is currently suspended beginning December 8, 2008 for lack of bond. CONCLUSIONS OF LAW 1. This matter is within the jurisdiction of the Registrar of Contractors pursuant to A.R.S. §§ 32-1104(A)(4), 32-1154(B) and 32-1156. 2. The Citation and Complaint issued by the Registrar of Contractors in this matter alleged potential violations of A.R.S. § 32-1154(A)(3), (7), (15), and (13)(specifically A.R.S. § 32-1124(B) and A.R.S. § 32-1158), and A.A.C. R4-9-108 and 109. 3. The Arizona Revised Statutes at § 32-1154(A)(3) provides grounds for suspension or revocation of a contractor’s license for “[v]iolation of any rule adopted by the registrar”. Pursuant to A.A.C. R4-9-108, Arizona licensed contractors must meet minimum workmanship standards in the projects they undertake. A.A.C. R4-9-109 requires a licensee to perform work under the same name as that of his license. 4. The Arizona Revised Statutes at § 32-1154(A)(7) provides for suspension or revocation of a contractor’s license for the “doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured”. 5. The Arizona Revised Statutes at § 32-1154(A)(13) provides grounds for suspension or revocation of a contractor’s license for failure to comply with provisions of that chapter. A.R.S. § 32-1124(B) requires contractors to display their license number and the acronym “ROC” on the premises of their projects and on all documents they employ. A.R.S. § 32- 1158 requires licensees to include minimum elements in their contracts that are entered into between December 31, 1992 and December 31, 2007, in an amount between $1,000.00 and $150,000.00. 6. The Arizona Revised Statutes at § 32-1154(A)(15) provides grounds for suspension or revocation of a contractor’s license for “acting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth upon the license.” 7. The Registrar of Contractors may consider the prior licensing record of a contractor in any disciplinary proceeding. A.A.C. R4-9-117. On standing motion by the Registrar of Contractors, the computer records of the Registrar of Contractors may properly be considered to be evidence in the event the Administrative Law Judge finds a violation of any of the statutory provisions cited in the Citation and Complaint. 8. In this case, the Complainants have established that Respondent violated A.R.S. § 32-1154(A)(3), specifically A.A.C. R4-9-108 by failing to meet minimum workmanship standards and A.R.S. § 32-1154(A)(7) by causing substantial injury to the Complainants by that violation. The weight of the evidence established that the Respondent should have known to allow for the weep screeds and install appropriate grading, and his failure to do so did not meet minimum workmanship standards. The portion of the contract that is in the file shows that Respondent charged the Complainants for many hours of grading, and the Complainants had the right to expect that this would be done according to the plans, or at least in a manner that met minimum workmanship standards. It is not sufficient to claim that an appropriate installation would not have pleased the client or would have run up against another code, if that were true. Respondent, as the licensee, is supposed to have the expertise to apprise the client of potential problems and work through them before they cause substantial injury and extensive repairs. Once apprised of the problem, Respondent refused to correct it, causing the Complainants to incur substantial damages, for which the Respondent denies any responsibility. The harm done to the Complainants in this case and the potential harm the Respondent is in a position to impose on an unsuspecting public militate in favor of the strictest disciplinary action. 9. The remaining potential violations set forth in the Citation and Complaint were not addressed at hearing. Therefore, the Administrative Law Judge makes no conclusions regarding those issues. RECOMMENDED DECISION In view of the foregoing, it is recommended that Respondent’s Class K- license (No. 189477) shall be revoked on the effective date of the Order entered in this matter. After which revocation, Case No. 08F-2169-ROC shall be closed. If the Director of the Office of Administrative Hearings certifies this Administrative Law Judge Decision, the effective date of the order will be forty days from the date of certification.

Done this day, December 23, 2008 OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Dorinda M. Lang 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