ALJDEC decisions subject to certification as final

08F-A0180-ROC · Registrar of Contractors · 2009-05-05

STATE OF ARIZONA IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 28 and November 3, 2008; March 10, 2009. APPEARANCES: Complainant: B. James Fischer appeared and was represented by counsel, Jeffrey R. Adams. Respondent: Dan William Conway, corporate officer and qualifying party, appeared and was represented by counsel, Robert A. Miller. Registrar of Contractors: Inspector Cliff Frandsen appeared at the August 28, 2008 hearing on behalf of the Registrar of Contractors.[1] 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 first convened for hearing via videoconference August 28, 2008, at the time, date and place set forth in the Registrar of Contractors’ Notice of Hearing dated July 17, 2008. The parties did not conclude the presentation of evidence at that time and the matter was set for further hearings on November 3, 2008 and March 10, 2009. 2. Complainant B. James Fischer (“Complainant”) is the owner of a residence located at 5350 W. Three Forks Road, Prescott, Arizona (“premises/project”). 3. Respondent Conway Stone and Tile, Inc. (“Respondent”) is a corporation which holds Arizona Contractor’s License No. 191179, Class K-48 (Dual Ceramic, Plastic and Metal Tile) issued by the Registrar of Contractors (“ROC/Registrar”) on November 30, 2003. Dan William Conway (“Conway”) is a corporate officer and the qualifying party for the license. 4. Complainant filed a Complaint with the ROC on October 23, 2007, wherein he alleged, inter alia, that Respondent had “damaged appliances…while installing bronze mural….” Complainant further asserted that when Respondent “refused to order new bronze pieces [Complainant] purchased new pieces & had them installed [and] ordered new replacement parts for the damaged appliances. Total cost: $7,370.37.” 5. On April 30, 2008, the Registrar issued a Citation and Complaint in Case No. A08-0180 charging Respondent with possible violations of A.R.S. § 32-1154(A) (7) and (3) (namely, R4-9-108, the workmanship rule). 6. Respondent filed an answer on May 15, 2008, wherein it asserted a general denial of all allegations and affirmatively asserted, inter alia, that it “complied with the law and acted in a workmanlike manner pursuant to applicable rule and has not committed any wrongful or fraudulent act…[and] attempted in good faith to cure alleged defects in the work of which Complainant complains, but Complainant refused to allow [Respondent] to complete the cure, to the extent any cure was even necessary.” 7. At the hearing, Complainant testified and submitted Exhibits C-1A through W, C-9, C-10, R-6, R-7, R-13 and R-14 which were marked, admitted and considered. 8. Conway testified on behalf of Respondent and submitted Exhibits R18 through R-29 which were marked, admitted and admitted. Exhibits R-17 and R-30 were admitted over objection. Louise Constantino (“Constantino”), installer, also testified on behalf of Respondent. 9. The parties stipulated to the admission of Exhibits R-1 through R- 5. 10. On approximately September 8, 2006, the parties entered into a Proposal Contract (“contract”) whereby Respondent, inter alia, was to install in the kitchen of the premises a tile back splash (“back splash”) and bronze art mural (“mural”) from Alloy Arts at a cost of $5,113,28.[2] (Exhibits R-1 and R-2) 11. In February and March 2007, Respondent performed work on the back splash and mural. 12. During the course of the installation of the back splash and mural, damage occurred to the stove top and some of its components including, without limitation, stainless steel around the stove top, a steamer and griddle as well as ceramic glass induction burners (“stove components”). A factual dispute exists between the parties regarding the cause of such damage. 13. Complainant contends that while installing the back splash and mural Constantino placed a blanket and paper over the then present stove top and components which were intended to protect those items from construction debris and workers. Complainant further contends that during the construction process the mural was removed at which time he noticed that the blanket/towel was covered with dried grout which had damaged the stove components. Complainant also testified that Conway first denied Respondent’s worker had anything to do with the damage but then recanted and took the blanket to show Constantino. Complainant gave inconsistent testimony regarding the presence of other subcontractors during the course of Respondent’s installation of the back splash and mural. Complainant initial said some were present but had been instructed to stay out of the kitchen area. Complainant subsequently acknowledged that a plumber and, possibly, an electrician could have been present during that time. Thereafter, Complainant clarified the issue by saying that the electrician was present in May 2007, well after the March 2007 work by Respondent. Complainant also asserts that during the installation process Constantino would lean on and against the blanket causing the above- referenced damages. Complainant contends that when discussing the damages, Conway admitted Constantino had made a workmanship mistake by using the subject blanket and offered to repair those items including an unsuccessful effort to repair the griddle top. 14. Constantino testified that the first day she was on the project no appliances were present while she laid out the mural. Constantino further testified that the appliances were present the second day at which time she placed a large towel (not a blanket) covered with rosin paper over the entire countertop. Constantino further testified that she did not have to climb on the stove top to install the mural and stood on a five gallon plastic bucket to reach the more difficult places. Constantino also related that many other subcontractors were present during the time she worked on the back splash and mural. Conway testified that Constantino used a towel, rosin paper and plastic to protect the stove and components and stood on a bucket when necessary to avoid damaging the stove. Conway also opined that none of Respondent’s employees caused the referenced damage. Conway further related that other workers were everywhere in the premises including the kitchen while the back splash was being installed. Conway also asserted that the nature of the scratches on the stove top/components were not of the type to have been made by Constantino’s work requirements. In addition, Conway averred that he offered to repair the griddle lid as show of good faith to Complainant, not an admission of liability. 15. Complainant also asserts that during the course of its installation Respondent damaged the mural. It is uncontested that after Respondent installed the mural it had to be removed to install a backer board to fill a gap in the back splash area behind and above the stove top. A factual dispute exists between the parties regarding the proper manner in which the reinstallation of the mural should have been addressed. Complainant testified that Respondent’s use of sanded grout and/or related application material damaged the bronze pieces of the mural resulting in a “haze” thereon. Complainant further asserted that, from approximately March to June 2007 Respondent unsuccessfully attempted to repair the mural three times, i.e., by chemical application, blow torch and sealant, at which time Complainant insisted that Respondent purchase a new mural which would be installed by a third party contractor. Complainant contends Respondent improperly used sanded grout to install the mural when un-sanded grout was required. Complainant also maintained that his workmanship standards should be the same as the ROC’s and rejected Respondent’s three proposed alternatives for resolving this dispute, i.e., complete the refinishing/re-installation itself; complete the refinishing and have a third party contractor install it; or settle the matter with the ROC. Complainant contends that only his proposal, i.e., a new mural, was an acceptable solution. Conway testified that the use of sanded grout was a proper application method for the mural and that Respondent relied on accepted remedial alternatives in its attempts to correct the problem. Conway contends that remedial alternatives would have been successful. Conway further contends that Complainant acted unreasonably when he refused to allow Respondent the opportunity to cure the mural defect and accede to Conway’s request to allow the ROC to intercede in the matter and conduct an inspection regarding the mural. 16. Based on Respondent’s refusal to do so, Complainant purchased a new mural and stove components and paid a third party contractor to install them at a cost of $7,370.37. Subtracting therefrom the $4,259.65 balance due Respondent on the contract, Complainant seeks restitution of $3,110.72 from Respondent in addition to the imposition of discipline on Respondent’s license. 17. It is uncontested that Complainant became upset with Respondent’s unsuccessful efforts to remedy the mural and “blew his top” at one point. 18. It is also uncontroverted that Respondent was “fired” from the project by Complainant at least four times and subsequently allowed back to complete the contract at Conway’s request. 19. As set forth in the Citation and Complaint issued by the Registrar, 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 regarding any prior final disciplinary orders against Respondent and said notice revealed that the instant Complaint was the only Complaint on the Registrar’s 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.

APPLICABLE LAW The Citation and Complaint issued by the Registrar in Case No. A08- 0180 charged Respondent with possible violations of A.R.S. §32-1154(A) (7) and (3) (namely R4-9-108). Those statutory sections require that the holder of a license or person listed on the license shall not commit the following:

7. The doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured. … 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 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, Complainant 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. It is determined and concluded that Complainant failed to establish by a preponderance of credible, probative and relevant evidence that Respondent violated A.R.S. § 32-1154(A) (7) and (3) (namely, R4-9-108, the workmanship rule) as they pertain to the alleged damage to the stove top and stove components. The good faith factual dispute regarding the nature of the protective measures implemented by Respondent to protect the referenced items, the alleged actions of Respondent and/or its employees, the presence of other subcontractors and the nature of the damage itself as set forth in Findings of Fact 12, 13 and 14 hereof preclude a determination that Respondent acted in violation of accepted minimum workmanship standards. In this instance, Complainant failed to demonstrate that Respondent caused the referenced damages and/or otherwise violated any applicable workmanship standards. 5. It is further determined and concluded that Complainant failed to establish by a preponderance of credible, probative and relevant evidence that Respondent violated A.R.S. § 32-1154(A) (7) and (3) (namely, R4-9-108, the workmanship rule) as they pertain to the mural. Contrary to Complainant’s position, the Registrar does not apply perfection and/or a homeowner’s subjective standards when judging workmanship. In this instance, although this tribunal is sympathetic to Complainant’s frustration with Respondent’s unsuccessful attempts to remedy the mural problem, the facts presented herein do not justify a departure from a long- standing policy of the Registrar to allow a contractor an opportunity to correct construction deficiencies which are determined at a hearing prior to imposing any discipline on a license. In fact, Respondent apparently performed approximately ninety percent (90%) of its contractual obligations on the project without incident. Thus, Complainant’s insistence that any further corrective work be done per his manner and subjective standards and without the assistance of the Registrar is deemed to have been unreasonable and tantamount to a denial of access to the property to perform the necessary remedial work. 6. This tribunal further determines and concludes that the facts presented herein do not warrant an award of restitution to Complainant especially due to the fact that $4,259.65 remains due and owing Respondent under the contract.

RECOMMENDED ORDER Based on the foregoing, IT IS RECOMMENDED that the entire Citation and Complaint issued in this matter be dismissed.[3] Done this day, May 5, 2009.

_________________________ Brian E. Smith Administrative Law Judge

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

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

By ___________________________ ----------------------- [1] At the August 28, 2008 hearing the parties advised that neither would be calling Inspector Frandsen to testify and he was, therefore, excused. [2] The total price of the contract was $43,521.09; the costs for the Cook Top Splash ($3,819.11), Kitchen Deco Dots ($436.75) and Full Height Splash (($857.42) total $5,113.28. Other tile work provided for under the Contract is not in issue. The scope of Respondent’s work on the project included, without limitation, four bathrooms, a laundry and the kitchen. [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