ALJDEC decisions subject to certification as final

2010A-308473826-ROC · Registrar of Contractors · 2011-02-16

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING DATES: January 5, 2011, at 8:00 a.m. and January 14, 2011, at 8:00 a.m. APPEARANCES: Complainants Leslie and Jill Duckett appeared through Mark D. Bogard, Esq., Jaburg & Wilk, P.C.; Respondent Sun City Restoration, L.L.C. appeared through Richard W. Morris, Esq., Morris Law Firm. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure In January 2005, the Registrar of Contractors (“the Registrar”) issued License No. ROC203111, Class B-3 for residential general remodeling and repair contracting to Sun City Restoration, L.L.C. (“Respondent”). Brent Monroe is Respondent’s qualifying party and managing member. On June 16, 2010, the Registrar received a complaint from Leslie and Jill Duckett (“Complainants”) regarding Respondent’s substantial remodeling of Complainants’ house at 10960 W. Tropicana Circle in Sun City, Arizona. Complainants attached to their complaint a chart listing 65 specific items of complaint, including that Respondent had issued two fraudulent change orders to increase the price of the remodeling project. On July 1, 2010, the Registrar’s inspector, James Hennessy, performed a jobsite inspection. On July 12, 2010, Inspector Hennessy issued a Corrective Work Order (“CWO”) that required Respondent within fifteen days to take appropriate corrective action with respect to the following items and categories of items of complaint, in relevant part as follows: 1. Respondent was to “abide by the terms and conditions of the contract and by all properly submitted change orders” with respect to allegedly fraudulent Change Order No. 1294, apparently because Complainants had not signed or paid for the items in Change Order No. 1294 (Complaint Items #1, #2, #12, #13, #25, #26, #29, #41, #46, and #60); 2. Respondent was to “abide by the terms and conditions of the contract” with respect to its installation of Nirvana, rather than Pergo, laminate flooring because the written contract called out for Pergo (Complaint Items #3, #14, #22, #33, #39, and #45); 3. Respondent was to replace trim with stained trim in the guest bedroom, paint the walls in the guest bedroom, “per the terms and conditions of the contract” (respectively, Complaint Items #27 and #28); 4. Respondent was to install a Kraftmaid medicine cabinet in the master bath because Brent Monroe had “initialed the change on Duckett Contract” (Complaint Item #43); 5. Pursuant to Respondent’s jobsite agreement, Respondent was to correct by using properly licensed contractors the outlets in the kitchen that were too far apart to comply with code, install an anti-tip device on the kitchen range, provide and install a microwave in the kitchen, secure the Romex in the attic within 8” of the electrical box, and place sheathing in the box (respectively, Complaint Items #8, #11, #16, and #48); 6. Respondent was to correct by using properly licensed contractors “as per code and/or manufacture [sic] instructions,” the air gap in the kitchen sink (Complaint Item #6); 7. Respondent was to correct the can lights in the kitchen that were not rated ICU and were in contact with the insulation (Complaint Item #10); 8. Respondent was to identify the properly licensed plumbing subcontractor who installed the toilet, sink, and bath faucet in the guest bath and the toilet, sinks, new shower, and p-trap in the master bath (respectively, Complaint Items #30 and #37); 9. Respondent was to provide proof of inspection of underground plumbing, and if the underground plumbing failed inspection because it was not constructed per plan, Respondent was to “correct by the appropriate means, using a properly licensed contractor” (Complaint Item #5); 10. Respondent was to install the backing on the garage exterior wall, as the plans required, even though Respondent indicated that a sheer wall was not required at this location and that the wall would cause the siding to stick out past the existing wall (Complaint Item #53); 11. Respondent was to connect the new switch to patio switch that did not work, using a properly licensed contractor (Complaint Item #56); and 12. Respondent was to correct the patio concrete under the hot tub that sloped toward the house and ponded more than ¼” (Complaint Item #54). Inspector Hennessy did not require Respondent to take any action with respect to certain items or categories of items of complaint, in relevant part as follows:[1] 1. Complainants had corrected certain items before the jobsite inspection and requested an award of restitution for the cost of correction, but Inspector Hennessy “[did] not have the authority to award restitution” (Complaint Items #20, #34, #44, and #63); 2. Respondent’s allegedly fraudulent Change Order No. 1267, because Complainants had read, signed, and paid for the items in Change Order No. 1267 (Complaint Items #17, #18, #19, #21, #23, #24, #36, #47, #50, #51, #57, and #59); and 3. Respondent’s installation of Oakcraft veneer cabinets rather than Kraftmaid solid slab front cabinets, because the contract did not specify the type of cabinets to be installed (Complaint Items #15, #32, #38). Addressing Complainants’ complaint that Respondent had performed certain electrical work that was outside the scope of its B-3 license, Inspector Hennessy’s July 12, 2010 CWO stated: The properly licensed electrical contractor stated that some wire was pulled when he arrived, B-3 remodel license does not allow for electrical work, therefore [an] out of scope warning letter will be sent, and all other electrical items have been previously addressed in this CWO. #7, #31, #49

On July 16, 2010, Inspector Hennessy issued a second CWO to address Complaint Item #4 because he had inadvertently omitted it from the July 1, 2010 CWO. The July 16, 2010 CWO required Respondent within fifteen days to correct by using a properly licensed contractor the hall closet light switch that had been installed on the hinge side of the door. On or about July 28, 2010, Mrs. Duckett asked Inspector Hennessy to amend the complaint to allege an additional ten items. On August 18, 2010, Inspector Hennessy performed a second jobsite inspection. On August 19, 2010, Inspector Hennessy issued a third CWO that required Respondent within fifteen days to correct by appropriate means the following four items: 1. Respondent was to pull a permit and use a properly licensed contractor to install a vent on the master bath sinks (Complaint Item #66); 2. Respondent was to obtain an inspection of the underground plumbing in the master bath (Complaint Item #67); 3. Respondent was to use a properly licensed contractor to install a condensate line from the air conditioning unit to the edge of the roof and to determine the cause of and to correct the condensation that was running out of other areas of the air conditioning unit, other than the connection for the condensate line (Complaint Items #70 and #71); 4. Respondent was to use a properly licensed contractor to install a separate electrical circuit for the microwave in the kitchen, as the code required (Complaint Item #73); and 5. Respondent was to securely attach the trim around five specifically identified doors (Complaint Item #75). Complainants requested that the Registrar issue a citation against Respondent and on October 18, 2010, the Registrar issued a Citation and Complaint against Respondent, charging violations of A.R.S. § 32- 1154(A)(2), (3) (namely A.A.C. R4-9-108), (17), and (23). Respondent filed a timely written answer and amended written answer to the Citation and Complaint, denying any statutory violations and raising certain affirmative defenses, including that Complainants had failed to provide reasonable access for Respondent to comply with the CWOs. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent agency, for an evidentiary hearing. The OAH conducted a two-day hearing on January 5 and 14, 2011. Inspector Hennessy testified at the hearing. Complainants presented the testimony of three witnesses: (1) Kevin Warren, the qualifying party and president of Efficient Electric, Inc., License No. ROC190328, Class K-11, the subcontractor that Respondent hired to correct code and workmanship violations on Complainants’ project; (2) Brandon Hopkins, who is employed by Environmental Conditioning, Inc. doing business as Parker and Sons, License No. ROC152654, Class K-37, Complainants’ plumbing expert for the hearing; and (3) Complainant Mrs. Duckett. Complainants submitted 18 exhibits. Respondent presented the testimony of five witnesses: (1) William Haas, Operations and Inspections Manager for Maricopa County Planning and Building Department; (2) Gary R. Gilliland, a building inspector for Maricopa County Planning and Building Department; (3) Patrick Middlebrook, the architect whom Respondent hired to prepare plans for the project; (4) Tim Stearns, the qualifying party and president of Stearns Floor Covering, Inc., License No. ROC215115, Class C-8, Respondent’s flooring contractor on the project; and (5) Mr. Monroe. Respondent submitted 28 exhibits.

Additional Evidence Complainants are farmers from Iowa. Complainants operate their 750-acre farm in Iowa for eight months a year, from approximately late March or early April to late October to early November. Complainants purchased their winter residence in Sun City in approximately 2002. Before the events at issue, they had hired another contractor to add an RV garage to their Sun City property. The other contractor had failed to get a final inspection for the RV garage. During the winter of 2009, Complainants decided to substantially remodel their house in Sun City. Mrs. Duckett picked out materials that she wanted for the remodeling project at Home Depot and Lowes and exchanged e-mails with Mr. Monroe about her selections. On or about March 30, 2009, Complainants and Mr. Monroe, on behalf of Respondent, executed a construction contract. The scope of work for the contract was provided in attached Invoice No. 1192, dated March 27, 2010. Invoice No. 1192 provided that Respondent would relocate the kitchen sink to a new island, provide new kitchen cabinets that were “maple finish, medium grade,” install new vanities in the hall and master bathroom “to match new kitchen cabinets,” install a new medicine cabinet in the master bathroom, style “to be determined,” paint the entire interior of the house, stain all interior doors, baseboards, and casing, and provide and install “approx. 485 SF of Pergo/laminate flooring in kitchen, hallway, hall bathroom, master bathroom, master bedroom, entry and entry to living room.”

Because Complainants were in a hurry to return to their Iowa farm, they conducted their final contract negotiations through e-mail. On or about March 30, 2009, Mrs. Duckett forwarded an e-mail to Mr. Monroe. Mrs. Duckett testified that she considered the e-mail to be part of the parties’ contract. Complainants left for Iowa on March 31, 2009, and Respondent began the remodeling project. Complainants expected that they would return to Arizona by November 15, 2009, and that the remodeling project would be complete by that date. Before Respondent could obtain a permit to begin the remodeling project at Complainants’ house, it had to arrange an inspection and close out the permit that Complainants’ contractor had obtained for the RV garage. Respondent hired Mr. Middlebrook to prepare plans of Complainants’ house in Sun City and the planned remodeling project to submit to the Maricopa County Planning and Building Department (“the County”) to obtain a permit for Complainants’ remodeling project. On or about April 29, 2009, Mr. Middlebrook, on Respondent’s behalf, applied to the County for a permit for Complainants’ remodeling project. The County subsequently issued a permit, and Respondent began construction on the project. Complainants returned to Sun City from Iowa for three or four days for a visit at the end of July 2009. Mrs. Duckett testified that she was surprised that Respondent had not completed more of the project, but was not too concerned because 3½ months still remained before Complainants planned to move back to Arizona for the winter. Mrs. Duckett testified that on November 15, 2009, Mr. Monroe asked for another week for Respondent to complete construction. Because the weather in Iowa had caused Complainants to delay their harvest, they did not mind giving Respondent more time to complete the remodeling project. On or about December 7, 2009, Complainants returned to Sun City from Iowa. To their dismay, Respondent had not yet installed cabinets, countertops, laminate flooring, appliances, a garage door, or new toilets. Complainants rented a house in Phase I of Sun City, approximately 2 miles away, to live in while Respondent completed the remodeling project. After Complainants returned to Sun City on December 7, 2009, Respondent presented Invoice No. 1267 to them, in the amount of $24,507.74 for certain work. On December 8, 2009, Complainants paid Invoice No. 1267 by check. Mr. Monroe testified that although the original contract required change orders to be in writing and signed by both parties, because Complainants requested that Respondent perform certain work by e-mail or telephone while they were in Iowa, Respondent obtained Complainants’ approval for additional work by e-mail or telephone. Mrs. Duckett testified that she and her husband were “shocked” to receive Invoice No. 1267 because it was almost 25% of the original contract amount. Mrs. Duckett testified that after she paid the invoice, she felt that Complainants were “being held hostage” and had to pay the invoice so that Respondent would finish the house. Mrs. Duckett testified that the charges on Invoice No. 1267 were excessive and that she had not approved any of those charges. Complainants moved back into their house in Sun City during the first week of February 2010. After Complainants moved back into their house, they became increasingly dissatisfied with the quality and pace of Respondent’s work on their remodeling project. Complainants made a 5-page list of complaints and invited Respondent to a meeting for an accounting. On March 25, 2010, Respondent’s remodeling project at Complainants’ house in Sun City passed the County’s final inspection. On March 31, 2010, Complainants met with Mr. Monroe for an accounting. On that date, Mr. Monroe presented Respondent’s Invoice No. 1294, in the amount of $7,588.27. Based on their list of complaints, at the March 31, 2010 accounting meeting, Complainants demanded $11,053.73 from Respondent, based on credits for the contract work that they had requested that Respondent not perform and the amounts that they had already paid other contractors or estimated that they would need to pay other contractors to complete or repair Respondent’s work. After Complainants returned to Iowa in 2010, they received a collection letter from Respondent’s attorney regarding their failure to pay Invoice No. 1294. Mr. Monroe testified that Complainants threatened to file a complaint to the Registrar if Respondent did not settle the disputed accounting items.

Respondent’s performance of electrical and plumbing work beyond the scope of its B-3 license (Complaint Items #30, #37, and #49)

Mrs. Duckett testified that after Complainants returned from Iowa in 2009, she saw Respondent’s employee, “Kevin,” performing electrical and plumbing work. Mr. Monroe testified that he was told at the contractors’ school that he attended before he obtained Respondent’s license that Respondent could perform minor or incidental plumbing and electrical work. Mr. Monroe acknowledged that Respondent had installed faucets, light fixtures, and ceiling fans at Complainants’ house, but testified that before Complainants filed the complaint, he did not know that such work was beyond the scope of Respondent’s B-3 license. In December 2009, Complainants hired an electrical contractor to inspect Respondent’s work and identify any deficiencies. In January 2010, Complainants presented a list of electrical deficiencies to Respondent. Respondent hired Kevin Warren of Efficient Electric, Inc. to repair the deficiencies that Complainants had identified and to inspect the remainder of the electrical work. After Complainants received the collection letter from Respondent’s attorney, they hired their own attorney. Mrs. Duckett testified that her attorney advised her that Complainants did not need to pay for any work that was performed by a contractor who was not licensed to perform the work. Plumbing (Complaint Items #5, #6, #66, and #67) Mr. Monroe testified that Respondent hired Rob Herron of Herron Plumbing and Heating, Inc., License No. ROC202105, Class K-37, to lay the underground plumbing in trenches that Respondent had dug. Mr. Monroe testified that the County inspected the underground plumbing that was part of the remodeling project. Mr. Haas testified that the code requires an inspection of underground plumbing before it is hidden from view. Mr. Haas testified that he assumed that the inspection of underground plumbing would have been part of the rough-in plumbing inspection at Complainants’ house. Mr. Gilliland was the County’s inspector on Respondent’s remodeling project at Complainants’ Sun City residence. Although Mr. Gilliland remembered being at Complainants’ house and seeing holes in the kitchen floor that would have been large enough to accommodate a pipe, he had no specific recollection of inspecting the underground plumbing. Mr. Gilliland testified that he had reviewed his paperwork and had not been able to find documentation of having inspected the underground plumbing at Complainants’ house. Mr. Gilliland testified that ideally there should have been a record, but unfortunately the County’s records were “not perfect.” Mrs. Duckett testified that after she and her husband moved into the house in Sun City in February 2010, she started noticing “gurgling” in the underground plumbing near the new sink in the kitchen island. Mrs. Duckett testified that when she ran the washing machine in the laundry room and dishwasher in the kitchen, the water backed up in the kitchen sink. In March 2010, Respondent hired Stoneridge Builders, L.L.C. doing business as Stoneridge Plumbing, License No. ROC263323, Class K-37 to investigate the cause of the “gurgling.” According to Stoneridge Plumbing’s March 22, 2010 invoice, it inserted a camera in the 8” line from the laundry room and discovered no blockage, only lint in the line. Complainants hired Parker and Sons to inspect the plumbing, and Parker and Sons sent Mr. Hopkins to Complainants’ house. Mr. Hopkins is a journeyman plumber with 13 years experience. Mr. Hopkins testified that he put a camera down the laundry vent at Complainants’ house to determine the cause of the “gurgling” at the kitchen sink. Mr. Hopkins testified that he was unable to access the new lines that had been installed for the sink. Mr. Hopkins testified that he went on the roof and looked at the plans to determine the location where the new line tied into the old line. The plans that were submitted at the hearing did not show the location of new plumbing lines. Mr. Hopkins testified that he placed small pieces of electrical tape on Complainants’ floor in the kitchen to identify the location where the new pipe tied into the old. Mrs. Duckett testified that when she visited the jobsite at the end of July 2009, she saw the cement for the new island sink with the cutout for the new plumbing. Mrs. Duckett placed orange tape between the two pieces of black electrical tape that Mr. Hopkins placed on the kitchen floor to show her recollection of the location of the new plumbing line. Mrs. Duckett’s photographs of the orange lines showed two angles in the line that were more than 90°. Mr. Hopkins testified that the new plumbing line was not installed per plan or per code, because the line had a 180° turn from the line from the clothes washer, which could cause backflow issues. Mr. Hopkins testified that plumbing lines are supposed to run as close to straight as possible to avoid drainage issues. Mr. Monroe testified that Mrs. Duckett’s orange lines did not show the location of the pipe. Mr. Monroe testified that the electrical tape that Mr. Hopkins placed showed only the location of the existing sewer line. Mr. Hopkins testified that the kitchen sink had an air emittance valve, rather than a vent, and was not constructed according to plan. Mr. Hopkins acknowledged that the code allowed a high loop in the water line to be substituted for an air gap, and that the sink at Complainants’ house had a high loop. Inspector Hennessy testified that Mrs. Duckett could not duplicate the “gurgling” in the kitchen sink at his first two jobsite inspections. However, Inspector Hennessy testified that when he conducted the prehearing inspection, he heard a “loud noise” at the kitchen sink. Inspector Hennessy testified that if he had heard the noise at the first two inspections, he would have ordered Respondent to determine the cause of and to correct the noise.

Oakcraft veneer rather that Kraftmaid cabinets (Complaint Items #15, #32, #38 and #43)

In Mrs. Duckett’s March 30, 2009 e-mail, she stated that Complainants had selected “KraftMaid Caramel stain Malibu Slab Maple” for the cabinets. Mrs. Duckett had written many comments in pencil and had traced the comments with pen to make them more visible on the copy of Invoice No. 1192 that was submitted at the hearing. Beside the style of the master bathroom medicine cabinet that Invoice No. 1192 said was to be determined, Mrs. Duckett had written, “Kraft Maid w/lights.” The initials, “BM,” appeared next to Mrs. Duckett’s entry, and Mrs. Duckett testified that Mr. Monroe had written his initials to signify his agreement with her addition to Invoice No. 1192. Mr. Monroe testified that he did not agree to install any Kraftmaid cabinets in Complainants’ house in Sun City, because solid wood cabinets are problematic in Arizona. Mrs. Duckett testified that she wanted solid wood doors for her cabinets because that is what she has in Iowa. Respondent submitted a letter from its supplier, Chris Rohde of Refined Designs Custom Cabinetry, which stated that Complainants had specifically approved the cabinets that he manufactured for the project. Mr. Rohde’s letter further stated that “[t]he use of natural wood veneers on ‘slab’ type doors is incredibly commonplace in Arizona due to the fact that a solid slab door cannot allow for very much expansion or contraction of the wood without extreme warping or cracking of the doors taking place” due to “the incredibly low relative humidity and high temperatures in Arizona . . . .” Mrs. Duckett acknowledged that she had talked to “Chris” about her cabinet selection and that she was happy with Respondent’s installation and work on the cabinets. Nirvana rather than Pergo laminate flooring (Complaint Items #3, #14, #22, #33, #39, and #45)

In Mrs. Duckett’s March 30, 2009 e-mail, she expressed concerns about installation of the Pergo laminate flooring in the kitchen and bathroom because it could be damaged by water spills. Mrs. Duckett stated in the e- mail that she was considering vinyl flooring for the kitchen and bathrooms. Mrs. Duckett testified that she has vinyl flooring in her house in Iowa, but wanted Pergo laminate flooring in her house in Sun City. Mrs. Duckett admitted that Respondent installed approximately 900 square feet of laminate flooring in her house in Sun City, rather than the 485 square feet that the contract required. After Complainants returned from Iowa on December 7, 2009, they visited the house daily to observe Respondent’s progress on the remodeling project.

Mrs. Duckett selected a laminate floor from the samples that Respondent showed her. Mrs. Duckett testified that she only meant to select the color, not the brand of flooring. In January 2010, Respondent delivered boxes of laminate flooring to Complainants’ residence in Sun City, with the brand, “Nirvana,” printed on the side of the boxes. Because the flooring needed to acclimate, the boxes sat in Complainants’ house for at least three days. Mr. Stearns testified that he remembers Mr. Duckett reading the product and warranty information that came with the Nirvana flooring that was in the boxes. In January and February, Mr. Stearns installed the Nirvana flooring in Complainants’ house. He testified that in his opinion, Nirvana and Pergo produce comparable flooring and that he did a good job installing the laminate flooring. Respondent’s access to jobsite to comply with the CWOs Inspector Hennessy testified that property owners must allow contractors access to perform repairs or lose their right to any relief from the Registrar. Inspector Hennessy testified that at one time Complainants said that they did not want Respondent to correct any items of workmanship, and he informed them that the Registrar probably would dismiss the complaint if Complainants did not allow Respondent to have access to perform repairs. On July 2, 2010, the day after Inspector Hennessy issued the first CWO, Mrs. Duckett contacted Mr. Haas at the County and had him issue a Notice to Stop Work order because Respondent allegedly had not obtained permits for underground electrical conduit and other electrical work. On July 21, 2010, Mrs. Duckett requested that the County issue a second Notice to Stop Work order for the same reasons, as well as that the underground plumbing had been completed without a necessary permit. Mr. Monroe testified that shortly after the first CWO was issued, Respondent arrived at Complainants’ house to begin corrective work. Mr. Monroe testified that Mr. Duckett asked to see the license of the painter that Respondent had hired and to see the permit for the painting. Mr. Monroe testified that when he told Mr. Duckett that a permit was not needed for painting, Mr. Duckett said, “Stop work; you need a permit.” Mr. Monroe testified that Respondent and its painting subcontractor left after only 28 minutes at Complainants’ house. Respondent submitted correspondence from Mrs. Duckett dated July 23, 2010, stating that she would not allow Respondent or its subcontractors to repair the kitchen outlets or to disconnect the hot tub to repair the slab without a permit. Mrs. Duckett’s correspondence concluded that if Respondent did not obtain the permits that she thought were required, she would obtain another Stop Work Order. Several confrontations occurred between Mr. Monroe and Complainants while Respondent was attempting to perform corrective work. Mr. Monroe informed the Registrar that he felt threatened by Complainants. Mrs. Duckett responded that was ridiculous, since she is 73 years old and much smaller than Mr. Monroe. When Mr. Monroe attempted to bring a professional videographer to film Respondent’s corrective work and Complainants’ interactions with Mr. Monroe and his employees and subcontractors, Mr. Duckett asked him to leave the property. On July 30, 2010, Respondent obtained a permit from the County to “relocate switch in hallway & outlet kitchen.” After Complainants amended their complaint to allege the additional ten items, on Sunday, August 15, 2010, Complainants informed Respondent that they were available “Tuesday afternoon after 4 pm” to allow Respondent to inspect the additional items of complaint. On September 2, 2010, Complainants sent a letter to Respondent, again refusing to grant access for corrective work until Respondent obtained a permit for the underground plumbing. According to the Registrar’s record, Respondent’s license is current and in good standing. CONCLUSIONS OF LAW The matter lies within the Registrar’s jurisdiction.[2] Complainants bear the burden of proof and must establish cause for the Registrar to discipline Respondent’s license by a preponderance of the evidence.[3] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[4] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[5] 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.”[6] Complainants did not establish that the parties’ contract required Respondent to install Kraftmaid cabinets. Complainants also did not establish that Respondent agreed to modify the contract to require Respondent to install a Kraftmaid medicine cabinet in the master bathroom. Respondent established that Complainants acquiesced in Respondent’s installation of the Nirvana laminate flooring. Respondent established that the County inspected the underground plumbing at Complainants’ house, even though a detailed report of the inspection is not available, through no fault of Respondent’s. Complainants did not establish that the “gurgling” sound at the kitchen sink is coming from the new sewer pipe that Herron Plumbing and Heating, Inc. installed or is the result of any poor workmanship by Respondent or its subcontractors. Complainants established cause for the Registrar to discipline Respondent’s license under A.R.S. § 32-1154(A)(3) and A.A.C. R4-9-108[7] with respect to the items set forth at the summary of the CWOs at Findings of Fact Nos. 3.3, 3.5, 3.7, 3.10, 3.11, 3.12, 6, 8.1, 8.3, 8.4, and 8.5. Complainants established cause for the Registrar to discipline Respondent’s license under A.R.S. § 32-1154(A)(2)[8] with respect to the items set forth at the summary of the CWOs at Findings of Fact Nos. 3.5, 8.1, and 8.4. Mr. Monroe admitted that Respondent installed plumbing and electrical fixtures at Complainants’ house.[9] Because Respondent should have known that such work was beyond the scope of its B-3 license,[10] Mr. Monroe admitted that cause exists for the Registrar to discipline Respondent’s license under A.R.S. § 32-1154(A)(17).[11] Respondent established that Efficient Electric, Inc. addressed Complainants’ general concerns about Respondent’s electrical work (Complaint Item #49). Respondent did not establish that any appropriately licensed plumbing subcontractor inspected or corrected its plumbing work (Complaint Item #37). Respondent established that Complainants failed to provide reasonable access for it to comply with the three CWOs in this matter. Although Complainants may not have been required to admit a videographer, they were not entitled to dictate the permits that Respondent was required to obtain before beginning the corrective work or the manner by which Respondent would perform the corrections. Because Complainants’ failure to provide reasonable access is a valid justification for Respondent’s failure to comply with the three CWOs, Complainants did not establish cause for the Registrar to discipline Respondent’s license under A.R.S. § 32- 1154(A)(23).[12] The impetus for Complainants’ complaint was their failure to reach an agreement with Respondent about the parties’ financial disputes at their March 31, 2010 accounting meeting. The legislature has not empowered either the OAH or the Registrar to adjudicate or award money damages.[13] Because Complainants have not established that any of the deficient items of workmanship cannot be corrected or that Respondent should not be allowed to correct or to hire an appropriately licensed contractor to correct these items, Complainants did not establish a right to restitution under A.R.S. § 32-1156.01. Complainants have sought money from Respondent as their preferred remedy since the March 31, 2010 accounting meeting. That preference, combined with Complainants’ failure to provide reasonable access to Respondent to allow it to comply with the CWOs and the animus that Complainants displayed toward Respondent throughout the complaint process, makes it unlikely that Complainants will allow reasonable access to Respondent to allow it to comply with any final order that the Registrar may issue in this matter that requires Respondent or its subcontractors to perform any corrective work at Complainants’ house. 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 place Respondent Sun City Restoration, L.L.C.’s License No. ROC203111, Class B-3 on disciplinary suspension for a period of fourteen days. It is further recommended that the Registrar’s final order in this matter be without prejudice to Complainants’ right to seek civil damages against Respondent in a court of competent jurisdiction for the items of workmanship that Complainants established were or could be deficient, that is, the workmanship items referenced at Conclusions of Law Nos. 9 and 10, and the plumbing work that Respondent performed and did not have inspected by a licensed plumbing contractor, as referenced in Conclusion of Law No. 13. 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 16, 2011.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Inspector Hennessy’s CWO did not require Respondent to take any action on many of Complainants’ Items of Complaint. If Complainants did not dispute or present evidence on a complaint item that the CWO did not require Respondent to correct, the item is not addressed in this recommended decision. [2] See A.R.S. § 32-1101 et seq. [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] See A.A.C. R2-19-119(B)(2). [5] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [6] Black’s Law Dictionary at page 1220 (8th ed. 1999). [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.” [8] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[d]eparture from or disregard of plans or specifications or any building codes of any state or any political subdivision of the state in any material respect which is prejudicial to another without consent of the owner or the owner’s duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.” [9] Respondent’s B-3 license allowed it to repair or remodel an existing residential structure “except for electrical, plumbing, mechanical, boilers, swimming pools or spas which must be subcontracted to an appropriately licensed contractor.” A.A.C. R4-9-103. [10] “’Knowingly’ imports only a knowledge that the facts exist which bring the act or omission within the provisions of the statute using such word. It does not require any knowledge of the unlawfulness of the act or omission.” A.R.S. § 1-215. It has long been the law in Arizona and elsewhere that “’[n]otice of facts and circumstances which would put a man of ordinary prudence and intelligence on inquiry is . . . equivalent to knowledge of all the facts a reasonably diligent inquiry would disclose.’” Maricopa Utilities Co. v. Cline, 60 Ariz. 209, 214, 134 P.2d 156 (1943) (quoting Schneider v. Henley, 61 Cal. App. 758, 215 P. 1036, 1038). [11] This statutory subsection includes among the grounds for suspension, revocation, and other disciplinary action against a contractor’s license, “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.” [12] 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.” [13] See J.W. Hancock Enterprises, Inc. v. Arizona State Registrar of Contractors, 142 Ariz. 400, 406, 690 P.2d 119, 125 (Ct. App. 1984).

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