ALJDEC decisions subject to certification as final

2010A-25312651-ROC · Registrar of Contractors · 2010-10-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 14, 2010 at 1:00 p.m. APPEARANCES: Complainant Charles Dodd appeared on his own behalf; Respondent J I C A Residential and Commercial Contracting, L.L.C. did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure On September 25, 2006, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC224630, Class KB-2 for dual residential and small commercial contracting to Respondent J I C A Residential and Commercial Contracting, L.L.C. Respondent’s address of record is 6546 W. Crown King Rd., Phoenix, AZ 85043- 7795. Johnny Avalos is Respondent’s qualifying party, managing member, and the only person listed on its license. On January 26, 2010, the Registrar received a complaint against Respondent from Complainant Charles Dodd. The complaint alleged that the roof that Respondent had replaced was leaking and that the grout in the tile that Respondent had replaced in the master bathroom was cracking at Complainant’s residence at 755 E. Appaloosa Rd., Gilbert, Arizona. The Registrar’s inspector, Randy Cason, sent a copy of the complaint to Respondent for its immediate attention. Inspector Cason also informed the parties of Respondent’s right to inspect the work and of the scheduling of a jobsite inspection. On February 1, 2010, Inspector Cason received Mr. Avalos’ initial response to the complaint. Mr. Avalos alleged that Respondent was not responsible for the workmanship deficiencies because unlicensed contractor Humberto Rodriguez of H20 Remodels put Respondent’s license number on his proposal without authorization and performed the work. Mr. Avalos also informed Inspector Cason that he would not attend the jobsite inspection. On February 8, 2010, at 10:00 a.m., Inspector Cason performed a jobsite inspection. No one attended the jobsite inspection on Respondent’s behalf.

On February 11, 2010, Inspector Cason, on behalf of the Registrar, issued a Corrective Work Order (“CWO”) to Respondent, directing it within fifteen days to correct its workmanship deficiencies, as follows: Complaint # 1 – The roof is leaking in at least 8 different places. Found multiple areas along the south side of the main roof, [sic] that are leaking through the installed roofing material by the Respondent. The Respondent is to correct all roof water leaks and any and all correlated damaged areas caused by these roof water leaks by appropriate means.

Complaint # 2 – The grout in the master bathroom shower is cracking. The Respondent is to correct by appropriate means. [Emphasis in original.]

On February 11, 2010, Inspector Cason sent a letter to Respondent, informing it that “[i]nformation has come to our attention that you may be dealing with an unlicensed contractor,” namely, Mr. Rodriguez of H2O Remodels. Inspector Cason informed Respondent that under A.R.S. § 32- 1154(A)(10), Respondent’s dealings with an unlicensed contractor furnished grounds to revoke or suspend its license. On March 4, 2010, the Registrar received Complainant’s request for a citation against Respondent’s license because Respondent had not done anything to comply with the CWO. Inspector Cason forwarded the complaint to the Registrar’s Legal Department. On June 7, 2010, the Registrar’s Legal Department received Complainant’s request to expedite the issuance of a citation against Respondent “due to health and further damage concerns,” in relevant part as follows: The roof that was “new” and part of my contract when I bought the house in April 2009 has a minimum of eight leaks which has [sic] already caused damage to my attic, insulation, and kitchen ceiling. Furthermore, I am concerned about the upcoming monsoon season. Monsoons carry very heavy rains and will cause the roof to leak more and I am very worried about the formation of mold in the attic and in my kitchen ceiling. If the roof leaks more, it will also cause more damage to my kitchen ceiling and surrounding areas.

In January, I paid a reputable roofer $100 to temporarily tarp my roof. He stated the roof was very poorly done with the cheapest materials. The tarp will not hold up to the monsoons [sic] heavy winds and a corner has already come off. I have done the responsible thing by trying to limit further damage to my house and I am requesting the [Registrar] help me by expediting this case so I can get my roof replaced.

JICA has to this point not responded to anything the [Registrar] has sent and there is no reason to believe Johnny Avalos will respond.

On June 8, 2010, the Registrar issued a Citation and Complaint against Respondent, charging violations of A.R.S. § 32-1154(A)(3) (namely A.A.C. R4- 9-108), (10), and (23). Respondent filed a timely written answer to the Citation and Complaint, denying any statutory violations and again affirmatively alleging that Mr. Rodriguez and H2O Remodels, not Respondent, had contracted for and performed the work. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing. On July 29, 2010, the Registrar issued a Notice of Hearing, setting a hearing at the OAH on September 14, 2010. The Registrar sent a copy of the Notice of Hearing to Respondent at its address of record. According to the OAH’s records, on September 2, 2010, Mr. Avalos made a telephone call to the OAH to state that he was unable to attend the hearing because he was in New Mexico. Staff at the OAH advised Mr. Avalos that “any concerns regarding this matter need to be submitted in writing.” Respondent did not submit anything in writing to the OAH. According to the OAH’s records, on September 14, 2010, just prior to the scheduled hearing, Mr. Avalos made another telephone call to the OAH to advise the Administrative Law Judge that he would be unable to attend the hearing because he was in New Mexico and “there is no way he can lose his job over this.” Although the beginning of the hearing was delayed fifteen minutes to allow Respondent additional travel time, it did not appear through an attorney or member. Respondent did not request that the hearing be continued, that the start of the hearing be further delayed, or that Mr. Avalos be allowed to appear telephonically on its behalf. Respondent did not present any evidence to defend its license. A hearing was held on September 14, 2010. Inspector Cason testified. Complainant submitted ten exhibits, testified on his own behalf, and presented the testimony of Jerry L. Conrad of Western States Roofing Consultants, Inc., a forensic roofing expert that Complainant had retained before the hearing to inspect and issue a report on the roof and the master bathroom shower. According to the Registrar’s records, Respondent’s license is current and in good standing. This is the only complaint pending against the license. Hearing Evidence In February 2009, Complainant entered into negotiations to purchase the house on Appaloosa Road from its former owner, Brett Kalina. During the negotiations, Mr. Kalina agreed to hire a properly licensed contractor to repair the master shower that was “leaking underneath due to no membrane under tile” and to inspect and repair the missing or damaged shingles on the roof. On March 4, 2009, Complainant’s real estate agent, Kelley Norton, sent an e-mail, informing Complainant that Mr. Kalina had hired Respondent to repair the roof and that “Johnny said they will be re doing [sic] the entire roof and most likely the tar paper underneath and replacing any damaged decking (wood) under that if it is rotted out.” Ms. Norton also furnished Respondent’s telephone number to Complainant. On March 4, 2009, Complainant called Mr. Avalos, confirmed the information in Ms. Norton’s e-mail, and informed Ms. Norton that he agreed that Respondent could do the work. Respondent submitted to Mr. Kalina an unsigned proposal for various work that had Respondent’s name, address of record, and license number at the top. Below Respondent’s information was Mr. Rodriguez’ and H2O Remodels’ names, address, and telephone number. The proposal included $6,000.00 to repair the roof and $1,800.00 to repair the master bathroom shower. On April 17, 2009, Complainant closed his purchase of the house. According to Mr. Kalina, he hired Respondent to perform the repairs to the roof and master bathroom shower. Mr. Avalos worked on the roof and hired Mr. Rodriguez to work inside the house. Before Complainant filed the complaint against Respondent with the Registrar, he hired Shaun Payne of Payne and Sons Construction Corp., License No. ROC194202, Class K-42 for dual roofing (“Payne and Sons”). Payne and Sons inspected the roof on January 19, 2010. On January 20, 2010, Payne and Sons sent Complainant three photographs of areas of the attic that evidenced numerous and extensive roof leaks. Payne and Sons recommended that Complainant file a complaint to the Registrar to force Respondent to repair the roof before he hired another contractor. Inspector Cason performed a prehearing jobsite inspection on September 13, 2010 at 10:00 a.m. No one attended the prehearing inspection on Respondent’s behalf. No work had been done to comply with the CWO. Inspector Cason testified that at the prehearing inspection, he saw that the platform for the air conditioner was not properly attached to the roof. The only things holding the air conditioner onto the roof were screws in the sheet metal air duct coming out of the attic. Inspector Cason could see that the back part of the platform was starting to shift. Inspector Cason testified that Respondent would have removed the platform for the air conditioner before it installed shingles on the roof. Although the air conditioner platform was not part of the original complaint, proper repair of the roof would require the roofing contractor to remove and reattach the platform. Mr. Conrad testified that he inspected the roof in late June 2010, and observed numerous deficiencies. Given the number of leaks and large areas of concern, Mr. Conrad doubted that any contractor would attempt to repair and provide a warranty for the roof. Although the roof over the attached garage was not yet exhibiting signs of leaks, the same deficiencies that caused the roof to leak elsewhere also existed in that area. Therefore, Mr. Conrad testified that the entire roof needed to be removed and replaced. With respect to the grout in the master bathroom shower, Inspector Cason testified that the cracks were numerous and appeared to have worsened at the prehearing inspection. Mr. Conrad testified that the tile and shower pan needed to be removed in the master bathroom shower because the failure of the grout in the area where the shower wall connected to the tub indicated a leak. The worsening of the grout cracks indicated continued water intrusion. Complainant requested that the Registrar award restitution to allow him to hire other contractors to repair the items of complaint, in light of Respondent’s repeated failures to respond to the complaint except to deny responsibility, the worsening conditions of the roof and shower, and the increased danger of collateral damage to the structure if repairs were not expeditiously made. Complainant submitted three bids from appropriately licensed contractors to replace the roof and three bids from appropriately licensed contractors to repair the shower. Lifetime Roof Systems, Inc., License No. ROC056566, Class C-42 for residential roofing, submitted the low bid of $4,567.32 to replace the roof. Aboval Wood Concepts, L.L.C., License No. ROC243167, Class B-3 for general residential remodeling and repair, submitted the low bid of $2,350.00 to repair the shower. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[1] The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and it appears that Mr. Avalos actually received the Notice of Hearing.[2] Complainant bears the burden of proof and must establish Respondent’s contracting law violations by a preponderance of the evidence.[3] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[4] 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.”[5] Complainant established that Respondent violated A.R.S. § 32-1154(A)(3)[6] and (23)[7] in its initial construction of and failure to repair the roof and master bathroom shower after Inspector Cason issued the CWO. Complainant also established that Respondent violated A.R.S. § 32- 1154(A)(10)[8] by using unlicensed contractor Mr. Rodriguez doing business as H2O Remodels to perform contracting work pursuant to Respondent’s contract with Mr. Kalina. The Registrar may penalize a contractor’s license by ordering payment of restitution if the contractor does not immediately respond to a property owner’s complaint and the workmanship deficiency is such that the property owner is justified in hiring another contractor to remedy a health or safety issue or to mitigate damages.[9] Complainant established that Respondent did not respond to repeated requests to repair its workmanship, that the conditions of the roof and shower are worsening, and that additional delay likely will result in additional damage to Complainant’s house. Therefore, Complainant has established that he is entitled to restitution in the amount of the total of the two low bids submitted, or $6,917.32. RECOMMENDED ORDER Based on the foregoing, it is recommended that, on the effective date of the Registrar’s final order in this matter, the Registrar revoke Respondent J I C A Residential and Commercial Contracting, L.L.C.’s License No. ROC224630, Class KB-2 unless Respondent pays Complainant Charles Dodd $6,917.32. It is further recommended that if, on or before the effective date of the order, the Registrar receives satisfactory proof in writing from Respondent that it has paid Complainant $6,917.32 by cashier’s or certified check, the Registrar not revoke Respondent’s license but, instead, close Case No. 2010-25312651. It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(D).

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 revoke Respondent’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty. 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, October 1, 2010.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See 32-1101 et seq. [2] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [3] 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). [4] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [5] Black’s Law Dictionary at page 1220 (8th ed. 1999). [6] 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.” [7] 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.” [8] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]iding or abetting a licensed or unlicensed person to evade this chapter, knowingly combining or conspiring with a licensed or unlicensed person, allowing one’s license to be used by a licensed or unlicensed person with intent to evade this chapter.” [9] See A.R.S. § 32-1156.01; Sunpower of Arizona v. Arizona Registrar of Contractors, 166 Ariz. 437, 441, 803 P.2d 430, 434 (Ct. App. 1990).

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