ALJDEC decisions subject to certification as final

2009A-1582438-ROC · Registrar of Contractors · 2011-02-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING DATES: December 6, 2010, at 1:00 p.m.; January 24, 2011, at 1:00 p.m. APPEARANCES: Complainant Van Auken Properties, L.L.C. appeared through Dan Van Auken, its managing member; Respondent Allen Julius Windholz dba A W Commercial Construction appeared on his own behalf. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT In June 2005, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC208517, Class B-1 for commercial general contracting to Allen Windholz doing business as (“dba”) A W Commercial Construction. On December 1, 2008, the Registrar received a complaint from Dan Van Auken of Van Auken Properties, L.L.C. (“Complainant”) that the roof on a commercial building that Respondent had constructed for Complainant at 1596 Countryshire in Lake Havasu City, Arizona (“commercial building”) was leaking in several places, and that after several attempts, Respondent had not succeeded in repairing the leaks. Complainant requested that the Registrar require Respondent to “[r]emove the entire rear roof and replace correctly with new materials to be leak free.” The Registrar designated this complaint as Case No. L09-0158. The Registrar assigned the complaint in Case No. L09-0158 to Inspector Cliff Corlett for investigation. On December 12, 2008, Inspector Corlett performed a jobsite inspection. On December 23, 2008, Inspector Corlett issued a Corrective Work Order (“CWO”) in Case No. L09-0158 to Respondent, requiring it within fifteen days to determine the cause of the leaks and to repair by appropriate means the leaks and any collateral damage that the leaks caused in the commercial building. On February 18, 2009, Inspector Corlett sent a letter to the parties, informing them that the complaint in Case No. L09-0158 was closed because Complainant had not responded to the Registrar’s most recent correspondence. On January 27, 2010, Complainant requested that the Registrar reopen the complaint in Case No. L09-0158. On January 28, 2010, Inspector Corlett informed the parties that the complaint had been reopened and scheduled a second jobsite inspection on February 5, 2010. At the February 5, 2010 jobsite inspection, Respondent offered to repair the leaks and whatever collateral damage remained from the leaks. On February 9, 2010, Inspector Corlett sent a second CWO to the parties, requiring Respondent to perform the following corrective action on Complainant’s reopened complaint within fifteen days: ***Building still has leaking issues in same areas. Respondent should determine cause and correct by appropriate methods***** License #208517 issued to A W Commercial Construction was CANCELED on 07-14-2009 and cannot do or sub-contract the recommended corrective work listed in this directive. The only available remedy under this license status, if appropriate, would be a financial settlement.

[Emphasis in original.] On March 26, 2010, the Registrar received a letter from Mr. Van Auken, on Complainant’s behalf, in relevant part as follows: I received your letter dated February 9, 2010 stating that action must be taken no later than 15 calendar days from the date of your letter.

Joe Burroughs[1] did call me approximately February 19th stated he need [sic] more time to acquire the gutter material. Allen Windholz has taken some action, by way of patching and painting the drywall holes, however the problem is still unresolved. The work that still needs to be done as agreed is as follows:

Gutters Installed Old Insulation Removed & Replaced

I have been very patient so, please advise me as to when this remaining work might be completed. I would like this issue resolved.

[Footnote added.] On April 1, 2010, Inspector Corlett responded to Mr. Van Auken’s letter, in relevant part as follows: I can only call your attention to the [CWO] dated February 9, 2010 (copy attached) that advised both parties that the Respondents [sic] license was canceled on 07-14-2009 and that the only remedy available under these conditions would be financial. If this has not occurred and if the complainant wishes to pursue the matter then the [Complainant] may file a formal complaint.

The Registrar subsequently renumbered Case No. L09-0158 as Case No. 2009- 1582438. On April 29, 2010, Inspector Corlett sent a letter to Complainant in Case No. 2009-1582438, informing it that “[s]ince we have not heard from you for quite some time regarding the above-referenced complaint, we assume the complaint has been resolved. If this is not the case and you wish to pursue the matter further, it must be done through a hearing.” On May 4, 2010, the Registrar received a letter from Complainant requesting a hearing because Respondent still had not resolved the two items on Mr. Van Auken’s March 26, 2010 letter. On August 11, 2010, the Registrar issued a Citation and Complaint in Case No. 2009-1582438 against Respondent, charging violations of A.R.S. § 32- 1154(A)(3) (namely A.A.C. R4-9-108), (18), and (23). Respondent timely answered the Citation and Complaint, denying any statutory violations and affirmatively alleging that his roofer had repaired two small leaks in the roof and that he could not perform further repairs because he no longer possessed a current license. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. A videoconference hearing was commenced on December 6, 2010, at 1:00 p.m. Inspector Corlett testified. Mr. Van Auken testified on Complainant’s behalf and submitted six exhibits. Respondent testified. Inspector Corlett performed a prehearing inspection at 11:00 a.m., on December 6, 2010. Inspector Corlett testified that although Mr. Van Auken said that he was concerned about continuing leaks, Inspector Corlett had seen no evidence that the roof still leaked at the prehearing jobsite inspection. Mr. Van Auken also complained that a wood beam that Respondent had installed had twisted, and expressed concern about the beam’s structural integrity. Inspector Corlett testified that he did not believe that the twisted wood beam compromised the structural integrity of Complainant’s commercial building. Mr. Van Auken testified that some of the insulation in the building had gotten wet when the roof had leaked and still needed to be replaced. Respondent testified that his roofing contractor had repaired all of the roof leaks in Complainant’s commercial building. Respondent testified that damage to the insulation that the leaks had caused had been repaired, with the exception of two small areas that were 45’ off the floor. Respondent testified that Complainant would not allow access for subcontractors to perform further repairs. After Mr. Van Auken indicated that Complainant would be willing to negotiate further with Respondent, the Administrative Law Judge set a further hearing to allow the parties to attempt to resolve their differences. A further hearing was held on January 24, 2011. Mr. Van Auken and Respondent testified. Mr. Van Auken testified that before the further hearing, Respondent had “done a deal” to resolve Mr. Van Auken’s concerns about the insulation at the commercial building. Mr. Van Auken testified that a “really good rain” had hit Lake Havasu City two or three weeks before the hearing, causing a small leak in the roof of Complainant’s commercial building. Mr. Van Auken testified that Respondent told him to call Monty’s Roofing,[2] and that Monty’s Roofing came out and tightened “two little screws” in the roof, and told him to call if he had further problems. Mr. Van Auken testified that although he had not seen evidence of continued roof leaks, he was concerned that the roof would leak in the next big rain. Mr. Van Auken also testified that Respondent refused to take care of the wood beam without an engineer’s report that the beam was structurally unsound. According to the Registrar’s record, as of the date of the further hearing, Respondent had not reinstated its canceled license. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[3] The canceled status of Respondent’s license does not preclude Complainant from pursuing its administrative remedy nor preclude the Registrar from conducting this disciplinary proceeding.[4] Complainant bears the burden of proof and must establish Respondent’s contracting law violations by a preponderance of the evidence.[5] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[6] A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”[7] Because Complainant at the hearing did not establish that the roof on its commercial building continues to leak or that the twisted wood beam should be repaired, Complainant did not establish that Respondent violated A.R.S. § 32-1154(A)(3) (namely A.A.C. R4-9-108)[8] or (23).[9] The evidence at the hearing established that Respondent continued to engage in contracting by sending roofing subcontractors to the commercial building to perform repairs after he had canceled his license.[10] Therefore, Complainant established that Respondent violated A.R.S. § 32- 1154(A)(18).[11] RECOMMENDED ORDER Based on the foregoing, as a result of the proven violation of A.R.S. § 32-1154(A)(18), it is recommended that the Registrar require Respondent to pay the sum of $1,000.00 as a civil penalty pursuant to A.R.S. § 32- 1154(E). It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s final order, the Registrar permanently revoke Respondent’s license, effective on such deadline date. 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 7, 2011.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Testimony at the hearing indicated that Respondent’s roofing subcontractor for Complainant’s commercial building was Burroughs and Sons Construction, Inc. (“Burroughs and Sons”). Although the Registrar’s record shows that it issued License No. ROC190276, Class B-1 for general commercial contracting to Burroughs and Sons, the record does not show that the Registrar issued any specialty license for commercial roofing to Burroughs and Sons. [2] The Registrar’s website does not show a license for Monty’s Roofing. [3] See 32-1101 et seq. [4] See A.R.S. § 32-1154(C), which provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license . . . .” [5] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [6] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [7] Black’s Law Dictionary at page 1220 (8th ed. 1999). [8] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[v]iolation of any rule adopted by the registrar.” The rule cited was A.A.C. R4-9-108, which requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.” [9] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.” [10] It is unlawful for anyone without a contractor’s license in good standing to engage in contracting. See A.R.S. § 32-1151. “Contractor” is defined as anyone who “does himself or by or through others” performs construction. A.R.S. § 32-1101(A)(3) (emphasis added). [11] This statutory subsection includes among the grounds for suspension, revocation, and other disciplinary action against a contractor’s license, “[c]ontracting or offering to contract or submitting a bid while the license is under suspension or while the license is on inactive status.”

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