ALJDEC decisions subject to certification as final

11F-A1112003-BFS · Department of Fire Building and Life Safety · 2012-03-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 19, 2012, at 8:00 a.m. APPEARANCES: The Petitioners appeared through Eileen Lupkes-Streich. Cavco Industries, Inc., dba Cavco Industries Litchfied Division and Cavco West (“Cavco”) appeared through its authorized representative, Scott Chambers. CMH Homes, Inc., dba Clayton Homes (“Clayton”) appeared through its authorized representative, Brent Bernard.

ADMINISTRATIVE LAW JUDGE: M. Douglas

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT 1. On September 21, 2011, Petitioners filed a consumer complaint with the Office of Manufactured Housing, Department of Fire, Building and Life Safety (“Department”). 2. On October 19, 2011, the Department closed Petitioners’ complaint citing the applicable statute of limitations. 3. On November 25, 2011, Petitioners filed the appeal at issue. 4. Petitioners purchased their residence from Clayton, and the manufactured residence was installed on February 12, 1998, at 6671 S. Avenida Don Fernando, #5, Tucson, Arizona. 5. There was no dispute that Petitioners’ new residence had been manufactured by Cavco. 6. On March 19, 1998, Petitioners filed a complaint (No. 98-0385) with the Department alleging various workmanship issues with the new residence. The complaint was investigated, corrective work was performed by Clayton and Cavco, and the complaint closed on August 26, 1999, on the basis that all items had been corrected by the Clayton and Cavco. 7. On June 17, 2005, Petitioners relocated their residence from its original location at 6671 S. Avenida Don Fernando, Tucson, Arizona, to its current location at 6786 S. Fallon Place, Tucson, Arizona. 8. On January 3, 2007, Petitioners filed a complaint (No. 2007-158) with the Department alleging damages caused to their residence while it was being moved from its previous location. 9. On January 10, 2007, the Department closed complaint No. 2007-158 on the basis that the complaint had not been filed within one year from the date of purchase or installation of the unit as required by A.R.S. § 41-2153 (9). 10. Pursuant to the filing of the complaint at issue, the Department notified Cavco on September 22, 2011, that applicable HUD regulations required that all homes manufactured under the Act, no matter the age, must be investigated pursuant to 24 CFR § 3282.404 for a possible nonconformance or defect. Therefore the Department instructed Cavco to investigate the complaint and the condition of Petitioners’ residence and to file a written response. 11. Cavco performed the requested inspection and on October 4, 2011, filed a written response. Cavco stated that it had investigated the complaint and performed an inspection of Petitioners’ residence and found that the residence had been constructed in accordance with all applicable HUD requirements and that the damage to the floor joists in the residence was caused during the 2005 move of Petitioners’ residence. 12. At the hearing, Petitioners asserted that the home had been reduced in value due to the damage that had occurred to the manufactured residence when it was moved in 2005, and that they are concerned that the cracked wood floor joists cause a dangerous level of formaldehyde emissions in their residence. 13. Petitioners provided testimony that they feel that they paid too much money for their residence and that the current monetary valuation of their residence is far less than the amount they owe on their mortgage. 14. Petitioners testified that they were unable to obtain refinancing for the residence because of the disparity between the value of the residence and the remaining amount of their mortgage on the residence. 15. Credible testimony and evidence established that Petitioners’ manufactured residence was damaged during the 2005 move. 16. There was no credible evidence that Cavco had anything to do with the move of Petitioners’ residence in 2005. 17. There was no credible evidence that Clayton had anything to do with the move of Petitioners’ residence in 2005. 18. There was no credible evidence that the formaldehyde emissions level in Petitioners’ residence exceed levels allowed by applicable HUD requirements. 19. The credible evidence of record is insufficient and fails to support a finding that there is a serious safety hazard in Petitioners’ residence caused by a manufacturing defect. 20. The credible evidence of record is insufficient and fails to support a finding that Petitioners’ residence was not manufactured in accordance with applicable HUD requirements as of the date of its manufacture. 21. The credible evidence of record is insufficient and fails to support a finding that Cavco is responsible for the damage caused to Petitioners’ residence when it was moved in 2005 or with the low current value of the Petitioners’ residence. 22. The credible evidence of record is insufficient and fails to support a finding that Clayton is responsible for the damage caused to Petitioners’ residence when it was moved in 2005 or with the low current value of the Petitioners’ residence. 23. The complaint at issue was not filed within one year from the date of the purchase of Petitioners’ residence or the installation of the residence. CONCLUSIONS OF LAW 1. This administrative hearing was held under authority of and pursuant to A.R.S. §§ 41-1092 and 41-2190 (C). 2. Subject-matter jurisdiction vests in the Department of Fire, Building and Life Safety under authority of A.R.S. §§ 41-2188 and 41-2190. 3. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in this matter is by a preponderance of the evidence. See A.A.C. R2-19-119. 4. Proof by “preponderance of the evidence” means that it 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, 654 (9th Cir. BAP (Ariz.) 1994). 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 at 1182 (6th ed. 1990). 5. Petitioners failed to sustain their burden of proof to establish that the Department’s determination to close the complaint at issue based upon statutory imitations was in error. 6. Petitioners failed to sustain their burden of proof to establish that their residence was not manufactured in accordance with applicable HUD requirements as of the date of manufacture. 7. Petitioners failed to sustain their burden of proof to establish that the Respondents were responsible for the damages caused to their residence when the residence was moved in 2005. 8. Petitioners failed to sustain their burden of proof to establish that the Respondents were responsible for the condition of Petitioners’ residence and the resulting low monetary value of the Petitioners’ residence. 9. Petitioners failed to sustain their burden of proof to establish that there is a serious safety hazard in their residence caused by a manufacturing defect. RECOMMENDed order In view of the foregoing, it is recommended that the Department’s determination to close the Complaint at issue be affirmed and that this matter 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 the date of that certification.

Done this day, March 29, 2012.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

Gene Palma, Director Department of Fire Building and Life Safety

-----------------------

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