ALJDEC decisions subject to certification as final

08F-2564-ROC · Registrar of Contractors · 2009-05-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 27, 2009 APPEARANCES: Complainant Jerry Joseph appeared on his own behalf. Wade Roberts appeared on behalf of Respondent Xpert Builders, Inc. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Respondent Xpert Builders, Inc. (“Xpert”) 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 1. Xpert is the holder of a Class KB-01 license (No. 173062) issued by the Registrar of Contractors (“ROC”). Wade Roberts is Xpert’s vice- president. 2. On May 23, 2006, Complainant Jerry Joseph contracted with Xpert for Xpert to provide plans and obtain the building permit for the construction of a custom home consisting of a main house with porch, casita, casita garage, and a detached garage, in Tonopah, Arizona. The parties agreed that Xpert would provide to Mr. Joseph an original set of plans, as well as two copies and an electronic copy of the plans. On February 23, 2006, Mr. Joseph paid $6,732.48 to Xpert, representing a 50% down payment for drafting fees, site inspection fees, and Maricopa County environmental fees. 3. On June 8, 2006, Mr. Joseph paid $7,361.98 to Xpert for obtaining the flood control permit, copy costs, permit fees, fees for the design of the on site waste treatment facility, and temporary electric. 4. On June 23, 2006, Xpert delivered three sets of county approved plans to Mr. Joseph. 5. On July 14, 2006, Mr. Roberts met with Mr. Joseph and delivered the building permit and all paperwork supplied by Maricopa County Planning and Development, including the stamped, approved for construction set of plans, as well as Xpert’s final invoice. Mr. Joseph paid Xpert’s final invoice in the amount of $6,581.48. See Exhibit 8. The Josephs terminated Xpert’s services on the same date via a note that read, “Wade, Thank you for your services. Jerry and I have decided to pursue other alternatives, so we will no longer need your services.” Id. The parties had previously discussed retaining Xpert for the construction of the home. 6. The Josephs had consulted with Cornerstone Design and Leos Construction regarding the construction of their home. Mrs. Joseph testified that both entities felt the plans were confusing and “not friendly”. Mrs. Joseph also testified that the electronic version of the plans given to them by Xpert, could not be read. Mrs. Joseph further testified that the Josephs had decided they wanted to move some interior walls and that Leos Construction could not ascertain from the plans whether the walls could be moved. The Josephs hired Leos Construction, Knuckles Construction, and Advanced Engineering for the construction of the home and to re-design the truss design and adjust the interior load bearing walls. The Josephs paid an additional $6,000.00 for the requested changes to be made. However, when the plans were re-submitted to the county, they were not approved, as the County discovered that the original permit was issued in error as the “house exceeds the maximum allowable lot coverage as required by the Maricopa County Zoning Ordinance.” See Exhibit 14, page 2. 7. The Josephs attempted to contact Mr. Roberts in an effort to have him make the desired changes. However, Mr. Roberts was not responsive to the requests as Xpert had been terminated by the Josephs and Xpert had fully performed the duties it was contracted to perform. 8. The Josephs thereafter abandoned the project and purchased an existing home in Sun City, Arizona. 9. On February 20, 2008, Mr. Joseph filed a complaint against Xpert with the ROC. Mr. Joseph alleged the above findings in his complaint. 10. Mr. Joseph testified that Advanced Engineering utilized the plans drawn by Xpert and modified them by moving an interior wall. The footprint of the house remained the same. However, after the modifications were made, the plans provided by Xpert could not be utilized by the Josephs notwithstanding the fact that the footprint of the house remained the same, because the county only allows 15% lot coverage, and the house covered 21.6% of the lot. The county discovered its error in issuing the building permit upon re-submittal after the changes were made. 11. Mr. Roberts testified that he would not modify the final approved plans by which the permit was issued without further payment for his services, because he had fully performed all duties he was obligated and paid to perform. Mr. Roberts further testified that the modifications requested to be made and eventually made by the Josephs were major structural changes and required a re-drafting of the plans. Mr. Roberts explained that the plans originally did not contain breezeways between the house and the casita and the house and the garage. However, the breezeways were added resulting in the footprint of the house exceeding the allowable percentage of lot size. Mr. Roberts credibly testified that his contact at the county had noticed the discrepancy but said he “would let it slide”, and the zoning was approved as evidenced by the approval of the plans and the issuance of the permit. Mr. Roberts testified that Mr. Joseph received a set of county approved blue prints and a permit that allowed him to construct his home, exactly that for which he contracted and paid. The modifications that caused the Josephs to lose money are not Xpert’s responsibility as Xpert fulfilled its contractual duties to the Josephs. CONCLUSIONS OF LAW In this proceeding, Mr. Joseph bears the burden to prove, by a preponderance of the evidence, that Xpert is subject to discipline for violations of A.R.S. § 32-1154(A)(7) and/or (A)(13) as charged by the ROC in its Citation and Complaint. See Arizona Administrative Code 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). The Administrative Law Judge concludes that Mr. Joseph met his burden of proof as to one of the ROC’s two charges. Under A.R.S. § 32-1154(A)(13), specifically, A.R.S. § 32-1124(B), a contractor is required to include its contracting license numbers, preceded by the letters “ROC,” on all documents utilized while engaged in construction-related activities. This requirement is applicable to business cards, sales literature, contract documents, invoices, and other forms utilized by a contractor. Mr. Joseph did not address this alleged violation. However, a copy of Xpert’s invoices were submitted into evidence by Mr. Joseph (Exhibits 4 and 15). Those documents do not contain the letters “ROC”, nor do they contain Xpert’s license number. In view of the foregoing, the Administrative Law Judge concludes that Xpert violated A.R.S. § 32-1154(A)(13). 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 Mr. Joseph failed to establish that Xpert committed wrongful or fraudulent acts that substantially injured him. Mr. Joseph received from Xpert that for which he contracted and paid, and Xpert fulfilled its contractual obligations to Mr. Joseph. Therefore, the Administrative Law Judge concludes that Xpert did not violate A.R.S. § 32- 1154(A)(7). 6. Upon consideration of all of the facts and circumstances presented by this case, the Administrative Law Judge concludes that the ROC should suspend Xpert’s Class KB-01 license. 7. The ROC’s authority in disciplinary matters such as the one presented herein includes the ability to impose reasonable conditions that allow the disciplined contractor to reduce the scope of the disciplinary action taken against it. The Administrative Law Judge deems the exercise of such authority to be appropriate in the instant case, and preferable to imposing discipline against Xpert’s license without providing a condition to reduce or eliminate same. 8. Upon consideration of all of the facts and circumstances presented by this case, the Administrative Law Judge concludes that the ROC should suspend Xpert’s Class KB-01 license subject to the condition that Xpert can avoid such suspension by amending its current business forms and all forms of advertising to reflect Xpert’s license number preceded by the letters “ROC”. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order: Xpert’s Class KB-01 license (No. 173062) shall be suspended until the ROC receives written confirmation that all of Xpert’s current business forms and all forms of advertising reflect Xpert’s license number preceded by the letters “ROC”. If Xpert complies with 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. 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, May 11, 2009.

______________________________________ Sondra J. Vanella Administrative Law Judge

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

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

By ___________________________ -----------------------

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