ALJDEC decisions subject to certification as final

2010A-308473446-ROC · Registrar of Contractors · 2011-02-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 19, 2011, at 8:00 a.m. APPEARANCES: Complainant Robert Lewis appeared on Complainants’ behalf; Respondent Moon Masonry appeared through Dohn M. Rosenthal, Esq. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure In January 1990, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC085334, Class C-31 for residential masonry to the partnership of Jason Clifford Moon, Sharon Ruth Moon, and Colin Clifford Moon, doing business as (“dba”) Moon Masonry (“Respondent”). Colin Clifford Moon (“Colin Moon”) is Respondent’s qualifying party. Cole Moon is Colin Moon’s 36 or 37-year-old son. Robert Lewis and Lori Lewis (“Complainants”) own the property and reside at 11148 E. Carol Ave. in Scottsdale, Arizona. On May 4, 2010, the Registrar received a complaint from Mrs. Lewis against “Colin Clifford Moon (‘Cole’)” and Respondent’s license number, alleging that Cole Moon had contracted to build a barbeque structure at Complainants’ residence, and that “[e]verything performed from masonry, stucco, tile, flagstone & paint substandard.” According to the complaint, no building permit was required for the project. Mrs. Lewis requested that the Registrar require the contractor to demolish the barbeque and rebuild the barbeque correctly. The Registrar designated Mrs. Lewis’ complaint against Cole Moon as Case No. 2010-[number redacted] and assigned it to Inspector Scott Deering for investigation. Inspector Deering sent a copy of Mrs. Lewis’ complaint in Case No. 2010- [number redacted] to Respondent and scheduled a jobsite inspection on May 18, 2010. Colin Moon, but not Cole Moon, attended Inspector Deering’s May 18, 2010 jobsite inspection in Case No. 2010-[number redacted]. Colin Moon informed Inspector Deering that Cole Moon was not authorized to act on Respondent’s behalf, and that Respondent did not contract with Complainants or perform any work on their barbeque structure. Inspector Deering informed Complainants that since Cole Moon was not a licensed contractor, Inspector Deering would not perform a jobsite inspection or issue a Corrective Work Order in Case No. 2010-[number redacted]. Instead, Inspector Deering stated that he would refer the complaint for a possible criminal citation for unlicensed contracting against Cole Moon and Complainants could seek redress against Cole Moon through a civil lawsuit. Colin Moon offered to have Respondent perform certain corrective work to the barbeque in exchange for Complainant Mrs. Lewis withdrawing her complaint in Case No. 2010-[number redacted] and agreeing to forego civil litigation against Cole Moon. Complainants accepted Colin Moon’s offer and withdrew the complaint to the Registrar against Cole Moon. On May 28, 2010, the Registrar received a complaint from Complainants against “Moon Masonry (Colin C. Moon)” for “[r]emediation of BBQ structure, completion of BBQ, tile work, flagstone, etc. to replace inadequate work of Cole C. Moon” pursuant to the settlement set forth in Respondent’s May 19, 2010 letter. According to the complaint, no building permit was required for the project. The Registrar designated Complainants’ complaint against Respondent as Case No. 2010-[number redacted]. On June 17, 2010, the Registrar received Complainants’ request for a citation against Respondent in Case No. 2010-[number redacted]. On September 24, 2010, the Registrar issued a Citation and Complaint in Case No. 2010-[number redacted] against Respondent, charging violations of A.R.S. § 32-1154(A)(1) and (3) (namely, A.A.C. R4-9-108). Respondent filed a timely written answer to the Citation and Complaint in Case No. 2010-[number redacted], denying any statutory violations. Respondent affirmatively alleged that it left the jobsite after it learned that Complainants had failed to obtain necessary building permits for the construction of electrical and gas lines for the job, and that Complainants had demanded that Respondent completely reconfigure the barbeque structure, even though Respondent had only offered to correct the tile, C.M.U., and flagstone on the project. The Registrar referred Case No. 2010-[number redacted] to the Office of Administrative Hearings, an independent agency, for an evidentiary hearing. A hearing was held in Case No. 2010-[number redacted] on January 19, 2011. Complainants presented the testimony of two witnesses: (1) Complainant Mrs. Lewis; and (2) Bart M. Shea, Complainants’ construction consultant, who is associated with Shea-Connelly Development, L.L.C. Complainants submitted 22 exhibits. Respondent presented the testimony of four witnesses: (1) Cole Moon; (2) Robert L. (“Robbie”) Brooks, whom Cole Moon employed to perform construction work on the project; (3) John Joseph (“Jay”) Dias, whom Cole Moon employed to perform general labor at the project; and (4) Colin Moon. Respondent submitted 18 exhibits, including one exhibit that was comprised of 8 photographs. Additional Evidence Cole Moon’s Construction of Complainants’ Barbeque Structure In 2010, Complainants decided to remove the existing barbeque structure in the backyard, to build another barbeque structure in another location, and to reuse the sink, stove, grill, and other components from the exiting barbeque structure. Complainants elected not to hire a general contractor for this project. Instead, Complainants hired an electrician to run a new electrical line and a plumber to run a new gas line from the existing location to the new location of the barbeque structure. The record does not reveal the identities or license status of the electrician and plumber whom Complainants hired to perform this work. The City of Scottsdale requires permits to run new electrical and gas lines underground. Complainants did not obtain any permits before their electrician and plumber installed the new underground electric and gas lines. Cole Moon and Mr. Brooks heard about the project from John Parent, who is a “regular” at a bar that all three frequent at 36th St. and Shea Blvd. Mr. Parent is Complainants’ “family friend” and brought Cole Moon to the jobsite, showed him the existing barbeque structure, and invited him to submit a bid to Complainants. Mrs. Lewis provided to Cole Moon a drawing that she had obtained from another contractor. The drawing showed the general locations of various components and a bar on the barbeque structure, with a 120˚ angle (approximately) in it. The length of one arm of the angle on the drawing was given as 8’; the length of the other arm was given as 10’. No other measurements or specifications were provided on the drawing. Cole Moon testified that he went over the drawing with Mrs. Lewis and she approved everything that he proposed to do to build the new barbeque structure. On or about March 25, 2010, Cole Moon submitted a bid to Mrs. Lewis to demolish the existing barbeque structure and to build a new one, for a total price of $5,300.00. The scope of work on Cole Moon’s bid included installation of flagstone, “material to be provided by homeowner,” but did not include painting or tile installation. Cole Moon’s March 25, 2010 bid showed “Moon Masonry” at the top. Mrs. Lewis submitted a copy of the March 25, 2010 bid to the Registrar as an attachment to her complaint against Cole Moon in Case No. 2010-[number redacted]. At some point before Mrs. Lewis submitted a copy of the bid to the Registrar, she had written Respondent’s license number and partners’ names on it. On or about April 5, 2010, Mrs. Lewis accepted Cole Moon’s March 25, 2010 bid and issued a check for $1,600.00, made payable to Cole Moon personally, to begin the project. Mrs. Lewis explained at the hearing that although she believed that she had hired Moon Masonry, not Cole Moon individually, Cole Moon was “always in a hurry,” and asked her to write the check to him personally because he could deposit it in the bank and pay his workers more quickly. During the time that Cole Moon and Mr. Brooks were working on Complainants’ project, Mr. Parent was doing various “handyman” jobs outdoors at Complainants’ residence. Because Mr. Parent watched and inspected their work, Cole Moon and Mr. Brooks assumed that he was acting as Complainants’ job superintendent. In addition, Mrs. Lewis lived at the property and viewed their work at least daily. Cole Moon and Mr. Brooks wore T-shirts with “Moon Masonry” on them during at least part of the time that they worked on Complainants’ job. Colin Moon explained at the hearing that he freely gives the T-shirts away to family, friends, neighbors, acquaintances, and individuals who live as far away as England or France because he considers the T-shirts to be “free advertising.” When Cole Moon and Mr. Brooks started the project, the electrical and gas lines that Complainants’ electrician and plumber had laid were exposed. Cole Moon testified that the lines were in the same trench, barely 2” apart, contrary to code, and were buried only 10” below ground, also contrary to code. Nonetheless, Cole Moon and Mr. Brooks began their work by covering the electrical and gas lines with dirt. Complainants’ electrician and Mr. Parent were present when Mr. Brooks and Cole Moon buried the gas and electrical lines. Mr. Brooks testified that he “knew there wasn’t a permit because of the way the whole thing went down.” Mr. Brooks explained that everyone was joking at the jobsite about how they did not have to worry about any code violations or a permit because “you can’t see it from my house.” Mrs. Lewis testified that she did not know that a permit was required for the job and that she relied upon Cole Moon and Respondent to tell her that she needed a permit. At some point during Cole Moon’s performance of Complainants’ project, Colin Moon came by the jobsite to retrieve a chipping hammer that Cole Moon had borrowed from Respondent. Colin Moon did not inquire about the job or contact Complainants or the Registrar about Cole Moon’s unlicensed activity. Cole Moon explained at the hearing that Complainants originally wanted to reuse flagstone from the existing barbeque structure. Cole Moon testified that he could not use the flagstone that was on Complainants’ property because it was broken into small pieces and was the wrong color. On or about April 9, 2010, Cole Moon purchased $310.65 worth of flagstone on Respondent’s account at Marvel Building and Masonry Supply (“Marvel”) for Complainants’ job. Cole Moon later paid Respondent for his purchase from Marvel on Complainant’s behalf. Colin Moon testified that he allows Cole Moon and his other son to use Respondent’s account to purchase construction materials and that Cole Moon sometimes does construction work for his friends. Colin Moon testified that he does not control and should not be responsible for the actions of his adult son. Colin Moon pointed out that it is natural for a parent to want to help and to protect a child, even after the child has become an adult. Cole Moon and Mr. Brooks poured concrete and laid the flagstone over at least a portion of the area where Complainants’ electrician and plumber had laid the electrical and gas lines. Cole Moon and Mr. Brooks completed the rest of the scope of work set forth in the March 25, 2010 bid. At some point, Mrs. Lewis asked Cole Moon to assist Mr. Parent in laying tile on the barbeque structure. Cole Moon testified that he warned Mrs. Lewis that he was ”not a tile guy,” but he agreed that if Mrs. Lewis purchased the tile, he would help Mr. Parent lay it, “just to be nice.” Mrs. Lewis purchased tile for the barbeque structure for $300 from Construction Lots and provided it to Cole Moon. Cole Moon and Mr. Brooks dropped all the appliances into the barbeque structure to make sure that they fit. After they assured themselves that the appliances fit, Cole Moon laid the tile that Mrs. Lewis had purchased. Complainants made two subsequent payments to Cole Moon for the remainder of the price set forth in the March 25, 2010 bid, as follows: (1) A check made payable to “Cole Moon” for $2,000.00, dated April 15, 2010; and (2) A check made payable to “Moon Masonry” for $1,700.00, dated April 20, 2010. Cole Moon personally endorsed the check made payable to “Moon Masonry” and deposited it into his personal account at Chase Bank, as he had done for the first two checks. Complainants never paid Cole Moon for providing the flagstone or laying the tile on the barbeque structure. Cole Moon and Mr. Brooks testified that Mrs. Lewis was happy with their work and the appearance of the barbeque structure. Mrs. Lewis testified that she was not satisfied with the barbeque structure, but only paid Cole Moon “under duress.” Mrs. Lewis did not testify as to the nature or cause of her claimed duress. Respondent’s Settlement of Complainants’ Complaint against Cole Moon, the Permits, and the Aftermath of the Settlement

On May 19, 2010, the day after Inspector Deering’s jobsite meeting with the parties in Case No. 2010-[number redacted], Colin Moon, on behalf of Respondent, sent a letter to Mrs. Lewis, setting forth the terms of the parties’ settlement, in relevant part as follows: As was found at the Registrar’s [jobsite inspection] on 5/18/10, the work you contracted with my son, Cole C. Moon was not done [by] Moon Masonry and, therefore, it has no responsibility for any claimed or found to be defective workmanship.

That having been said, Cole is my son, and I feel that you should not have to be dissatisfied with the work he performed. As we addressed at the [jobsite inspection] on 5/18/10, I am therefore prepared to attempt to remediate any work he performed which hopefully will be to your satisfaction.

I am offering to complete your barbeque, tile work, flagstone and patch the C.M.U. where needed at no cost to you. The work is to start after the Arizona Registrar of Contractors closes the case against Cole C. Moon and you agree to forego any civil litigation.

On May 19, 2010, Colin Moon also sent a letter to Cole Moon, reminding him that he was not authorized to represent Respondent or to contract on its behalf, and informing him that any future work or jobs that he undertook would be his sole responsibility. On May 20, 2010, Complainants responded to Respondent’s May 19, 2010 letter, in relevant part as follows: We are in agreement with the terms and conditions of your proposal, except as to the following: . . . .

• We concur that we will close the case against Cole Moon not later than the agreed on date with the Registrar of Contractors, which is this Friday, May 21, 2010. We will suspend temporarily any consideration of civil litigation against Cole Moon, pending completion of the reconstruction of the barbeque. Upon satisfactory completion of the project by Moon Masonry, we agree to permanently forego any civil litigation or seek financial recovery against Cole Moon.

• We request you provide us an estimated date of completion for the reconstruction. If it becomes necessary to adjust that date during the project, we would request you inform us of any change in a timely manner. Because of Lori’s schedule, we will not be able to have any work done on site between Friday, May 28 and Saturday, June 5.

On May 20, 2010, Colin Moon, on Respondent’s behalf, responded to Complainants’ letter of that same date, in relevant part as follows: My acceptance of the remediation project is qualified as follows:

1. The remediation work to be performed is limited to that set out in my letter of 5/19/10.

2. Moon Masonry will supply the labor and materials for the job at no cost to you.

3. Sales taxes, permits and permit fees are the responsibility of the home owner.

4. The remediation work shall be completed [in] a reasonable amount of time, but no exact date for completion is obligatory. The estimated date for completion is: May 27th, 2010.

On Friday, May 21, 2010, Colin Moon went to Complainants’ residence to inspect the barbeque structure and to begin repairs pursuant to the parties’ settlement agreement. Colin Moon removed the tile that Cole Moon had laid over the structure to prepare it for the licensed tile contractor that Respondent had hired to correct the tile. Colin Moon returned to the jobsite on Saturday, May 22, 2010, and measured the barbeque structure and checked to see if its surfaces were level. Colin Moon asked Mrs. Lewis whether she had taken out a permit for the job, and she responded that she had not. Colin Moon testified that when he told Mrs. Lewis that she should have taken out a permit for the job, she responded that she had already paid $2,000.00 to run the gas and electrical lines, that she “would not pay another cent” for a permit, and that Cole Moon should have gotten the permit. Colin Moon testified that he explained to Mrs. Lewis that the general contractor, homeowner, or specialty trade involved in the permitted work, such as the electrical contractor and plumbing contractor, must apply for the permit. Mrs. Lewis presented Colin Moon with a drawing of the way that she wanted Respondent to reconfigure the barbeque structure, but Colin Moon refused to sign the drawing. Colin Moon returned to Complainants’ residence on Monday, May 24, 2010, gathered Respondent’s tools, and left the jobsite. On May 25, 2010, Colin Moon, on Respondent’s behalf, sent a letter to Complainants, informing them that because no permit had been taken out, Respondent would not change any part of the barbeque structure “as requested by the owners,” and would not complete the tile installation. On May 26, 2010, two days before Complainants filed their complaint to the Registrar against Respondent, they applied online to the City of Scottsdale for a permit for underground plumbing. On June 14, 2010, Complainants applied online to the City of Scottsdale for a permit for underground electric. On June 22, 2010, the City of Scottsdale rejected Complainants’ permit applications for underground plumbing and underground electric because the work was covered and could not be inspected. Although Complainants renewed the permit applications, as of the date of the hearing, the work had not been uncovered, inspected, or approved. Evidence on Workmanship Cole Moon, Mr. Brooks, and Colin Moon testified that the barbeque structure was, for the most part, built in a professional and workmanlike manner. Mr. Brooks testified that the barbeque structure if anything was “overbuilt” and that “you could run a car into it” and it would not “go anywhere.” Cole Moon, Mr. Brooks, and Colin Moon agreed that Cole Moon had done a poor job laying the tile, especially on the backsplash, and had failed to adequately seal the flagstone at the edges. Colin Moon testified that Respondent in the settlement agreed only to repair the tile, complete the flagstone installation, and patch holes in the C.M.U. Colin Moon explained that the holes in the C.M.U. would be covered up and were not structural defects, but that he agreed to fill the holes because Mrs. Lewis was “perturbed” about them. Mrs. Lewis testified that she could not use the barbeque structure because the locations of the components did not allow the structure to be “functional.” Mr. Shea testified about various alleged deficiencies in the construction of the barbeque structure, especially free-standing “curtains” that needed to be secured to something else to make them safe. Mr. Shea also commented on the unfinished state of the barbeque structure. At the time of the hearing, Mr. Shea’s company, Shea-Connelly Development, L.L.C., had applied to the Registrar for a KB-1 license for dual building contracting, and the license application was pending. The Registrar’s record does not show that Mr. Shea is listed on any license that the Registrar has issued. Complainants did not pay Mr. Shea anything for his hearing testimony. Before the hearing, Mr. Shea had submitted a proposal to Complainants to substantially demolish and rebuild the barbeque structure to their specifications, at a cost of $6,100.00. CONCLUSIONS OF LAW The matter lies within the Registrar’s jurisdiction.[1] Complainants bear the burden of proof to establish cause for the Registrar to discipline Respondent’s contractor’s license under the statutes charged in the Citation and Complaint by a preponderance of the evidence.[2] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[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] Complainants did not establish that the barbeque structure was deficient in any respect other than the tile, the unsealed flagstone, and the holes in the C.M.U. that Respondent agreed to repair in the settlement agreement. However, because Respondent admittedly failed to perform the settlement agreement, Complainants potentially established that it violated A.R.S. § 32-1154(A)(1).[6] As a licensed contractor, Respondent could not work on a job that was required to be, but was not, permitted. As a masonry contractor, Respondent could not obtain a permit or an inspection for underground plumbing and electrical lines. Complainants are responsible for the impasse that prevented Respondent from performing the settlement agreement. Mrs. Lewis elected to act as Complainants’ general contractor and to hire the subcontractors who installed underground electrical and gas lines, in violation of the City of Scottsdale’s permitting requirements. Complainants did not even apply for the permits until they filed a complaint to the Registrar against Respondent, and appeared to have applied for the permits only to secure a tactical advantage against Respondent. After more than six months, Complainants still have not uncovered the gas and electrical lines or arranged for the lines be inspected, even though as the homeowner or general contractor on the project they are responsible for obtaining permits, scheduling inspections, and obtaining the City’s approval of permitted work. Because the City of Scottsdale’s inspection and approval of the underground gas and electrical lines are conditions precedent for Respondent’s performance of the settlement agreement, Complainants’ continued unwillingness to arrange for the City of Scottsdale’s inspection and approval of the project precludes any finding that Respondent violated A.R.S. § 32-1154(A)(1). Because at the time that Respondent discovered that Complainants’ barbeque structure was not permitted, the only work that Respondent had performed was removing tile in preparation for repairs that the absence of a permit prevented it from performing, Complainants did not establish that Respondent violated A.R.S. § 32-1154(A)(3) (namely R4-9-108).[7] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Registrar’s final order, Complainant Robert and Lori Lewis’s complaint in Case No. 2010-[number redacted] against License No. ROC085334, Class C- of Respondent Moon Masonry 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 40 days from the date of that certification. Done this day, February 1, 2011.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See A.R.S. § 32-1101 et seq. [2] 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). [3] See A.A.C. R2-19-119(B)(2). [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, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” [7] 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.”

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