ALJDEC decisions subject to certification as final

2010A-308477177-ROC-com · Registrar of Contractors · 2014-09-25

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 15, 2013, and July 17, 2014. The record in this matter was held open until September 13, 2014. APPEARANCES: Constance Kirkwood and Laura Kirkwood (hereinafter “Complainants”) were represented by their attorney, Dennis A. Rosen, Esq., Law Offices of Dennis A. Rosen. Home Resort Living Of Arizona Inc (FN) (hereinafter “Home Resort”) was represented by its attorney, Guy W. Bluff, Esq., Bluff & Associates. Complainants presented the testimony of Inspector Mike Nieves, who is employed by the Registrar of Contractors (hereinafter “Registrar”), Phillip Rosenberg, and Laura Kirkwood. Home Resort presented the testimony of Christopher Stump, Kelley Linfoot, and Larry Chavez. ADMINISTRATIVE LAW JUDGE: M. Douglas _____________________________________________________________________

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made: FINDINGS OF FACT The Order Denying Request for Rehearing/Order Setting Compliance Hearing provided, in relevant part, as follows: On October 25, 2011, the Registrar issued an Order providing that Respondent’s B-3.260542-R License would be suspended on the effective date of the Order and remain suspended until the Registrar received and accepted written proof that Respondent had either fully complied with the terms of the Corrective Work Order and the Addendum to the Corrective Work Order issued in this matter or written proof acceptable to the Registrar that Respondent had been denied reasonable access to Complainants’ residence to perform the corrective action necessary to comply with the terms of the Corrective Work Order and the Addendum to the Corrective Work Order issued in this matter. If Respondent had properly accomplished the previously described corrective action, on or before the effective date of the Order, then Respondent’s B-3.260542-R License would not be suspended. The Order had an effective date of December 4, 2011.

On or about November 29, 2011, Counsel for Respondent submitted a Reconsideration of 25-Oct-2011 Decision and Order/Request for Relief from Order maintaining, among other things, that Respondent “is not requesting a re-hearing of evidence. Respondent is simply requesting reconsideration by the Registrar of the severe sanction regarding suspension/ revocation of its license in the event the work is not completed. It is impossible for Respondent to meet the Registrar’s [O]rder. Complainants simply cannot be satisfied and are uncooperative . . . . The fact remains that despite the extraordinary efforts by Respondent to comply with the Registrar’s Order – it cannot complete the work. Complainants have repeatedly denied Respondent with access to their residence, and despite numerous efforts by Respondent both prior to and subsequent to the issuance of the CWO’s in issue, unreasonably and continuously refused to permit Respondent to complete the project work. Respondent has gone above and beyond in its efforts to satisfy Complainants. Respondent requests that the Registrar determine that its work is complete.”

On or about November 30, 2011, Counsel for Respondent submitted written correspondence between him and Counsel for Complainant in this matter with the Registrar. The correspondence maintained that Respondent would pay Complainants $2,600[.00] in lieu of having to complete the wall covering portion of the Registrar’s Order.

On or about December 2, 2011, Counsel for Respondent submitted Notice of Compliance with 25-Oct-2011 Decision and Order/Request for Compliance Inspection maintaining, among other things, that Respondent “hereby gives notice to the Registrar that it has fully complied with the Registrar’s Decision and Order dated 25-Oct- 2011. All work identified on the Corrective Work Orders dated 07- Dec-2010 and 12-Jan-2011 was completed Respondent on 18-Nov-2011 with the exception of the directed repairs to the wallcovering (sic) which Respondent is unable to complete . . . . Respondent has offered to pay Complainants $2,600[.00] to eliminate this work . . . yet never responded to by Complainants. Complainant’s (sic) home is ready for inspection and Respondent would welcome a compliance inspection by the Registrar in the event Complainants file an objection to this Notice of Compliance.”

On or about December 20, 2011, Counsel for Complainant submitted an Opposition to Respondent’s Motion for Reconsideration and Request for Relief from 25-Oct-2011 Decision and Order and Cross Motion for Reconsideration/ Inspection providing, among other things, that “the repairs/ corrections ordered by the [Registrar’s] October 25, 2011 Decision and Order have not been properly completed in accordance with this Judge’s Order nor to the minimum workmanship standards of the Registrar of Contractors.”

Upon review and consideration, and with good cause appearing, IT IS ORDERED that Counsel for Respondent’s Reconsideration of 25-Oct- 2011 Decision and Order/Request for Relief from Order be DENIED for the reason that there is no sufficient showing of any compelling legal or factual basis for the granting of any reconsideration and for the further reason that the findings, conclusions and recommendations contained in the Registrar’s October 25, 2011 Order are fully supported by the record.

Upon review and consideration, and with good cause appearing, IT IS ORDERED that Counsel for Complainant’s Cross Motion for Reconsideration/Inspection be DENIED as it was treated by the Office of Administrative Hearings as a motion for rehearing and a Cross Motion for Reconsideration/Inspection. Counsel for Complainant’s cross motion cannot be treated as petition for rehearing or reconsideration of the Registrar’s Order in this matter as the deadline for such motions was on or before November 29, 2011. Matters relating to compliance with the Registrar’s prior Order in this matter are within the purview of the Registrar of Contractors.

IT IS FURTHER ORDERED that this matter be set for a Compliance Hearing in the expedited course of docketing in the Phoenix area. At the Compliance Hearing, the parties may offer evidence and testimony as to whether or not Respondent has fully complied with the terms set forth in the Registrar’s October 25, 2011 Order.

If it is determined that Respondent has failed to fully comply with the terms of the Registrar’s October 25, 2011 Order, absent unreasonable interference or denial of access on the part of Complainants, then Respondent’s B-3.260542-R License shall be subject to the immediate imposition of the discipline.

If it is determined that Complainants unreasonably interfered with Respondent’s attempts at compliance or denied Respondent the ability to comply with the terms of the Registrar’s October 25, 2011 Order, then no discipline shall be imposed upon Respondent’s B-3.260542-R License and this matter shall be closed.

IT IS FURTHER ORDERED that prior to the date and time set for the Compliance Hearing in this matter that the assigned Registrar Inspector shall perform a pre-hearing Compliance Inspection and be prepared to testify as to his findings and observations at the Compliance Hearing.

Note: Complainants are not obligated to allow access to Respondent or its representatives to perform any further corrective work prior to the Compliance Hearing, as Respondent notified the Registrar that it complied with the terms of the October 25, 2011 Order.

Note: Normal "wear and tear" will not be considered deficient workmanship on the part of Respondent. The repairs were allegedly performed in December 2, 2011, and any inspection shall take into account normal "wear and tear." Further, Complainant is precluded from raising at the Compliance Hearing any issues unrelated to the repair work that Respondent performed.

HEARING EVIDENCE The assigned Registrar Inspector, Mike Nieves (hereinafter “Inspector Nieves”), testified that he conducted a pre-hearing Compliance Inspection at Complainants’ residence on October 11, 2013. Inspector Nieves stated the he inspected each of the items set forth in the Corrective Work Order and Addendum to the Corrective Work Order and that he observed that several items set forth in the Corrective Work Order and the Addendum to the Corrective Work Order had not been fully corrected. Inspector Nieves testified that the exterior excess caulking between the exterior stucco and the doors and windows had not been fully corrected. Inspector Nieves stated that all of the windows and doors had excess caulking on the door and window frames. Inspector Nieves testified that the caulking appeared to be smeared on. Inspector Nieves acknowledged that the Registrar’s Workmanship Standards do not have a specific written provision for the performance of caulking other than that caulking had to comply with applicable workmanship and industry standards. Inspector Nieves opined that the caulking work performed on the exterior windows and doors on Complainants’ residence failed to comply applicable workmanship standards. Inspector Nieves testified that the interior drywall and interior painting in the residence had not been fully corrected. Inspector Nieves stated that the paint and drywall repairs did not match the surrounding area for color and texture. Inspector Nieves opined that the corrective work on the interior drywall and interior painting failed to comply with applicable workmanship standards. Inspector Nieves testified that the staining in the interior of the residence had not been fully completed. Inspector Nieves stated that some of the edges of the windows and doors were not fully stained and that there were small areas on the thresholds that had not been fully stained. Inspector Nieves opined that the corrective work on the staining of the doors, windows, and thresholds failed to comply with applicable workmanship standards. Inspector Nieves testified that the installation of door knobs on the French doors had not been fully completed. Inspector Nieves stated that one door handle was not attached to one of the French doors. Inspector Nieves testified that during his initial onsite inspection, he observed that some of the doors and windows were not closing properly and that the doors and windows needed the seal around the doors and windows to be properly corrected. Inspector Nieves stated that two of the windows in a bedroom had air leaks. Inspector Nieves testified that he was unable to determine if the sealing of the doors and windows had been fully corrected.

Inspector Nieves testified that the various drywall crack repairs and the wallpaper on the interior of the residence had not been corrected. Inspector Nieves acknowledged that the various drywall cracks would normally be corrected as preparatory work before the wallpaper was corrected. Inspector Nieves stated that the directed corrective work on the interior drywall and wallpaper had not been completed. Inspector Nieves opined that Home Resort had failed to comply with the terms of the October 25, 2011 Order of the Registrar. Inspector Nieves’ testimony is found to be credible. Phillip G. Rosenberg (hereinafter “Mr. Rosenberg”) testified that he was a licensed residential and commercial contractor and that he had previously testified as an expert witness. Mr. Rosenberg stated that he had inspected Complainants’ residence and that he was present when the Complainants took photographs of their residence on or about November 11, 2011. Mr. Rosenberg testified that he was familiar with the applicable workmanship standards for licensed contractors. Mr. Rosenberg stated that the caulking on the exterior windows and doors of Complainants’ residence was straight but that the caulking was excessive in width and varied from smooth to textured. Mr. Rosenberg opined that the caulking failed to comply with applicable industry and workmanship standards. Mr. Rosenberg testified that the drywall repairs and the wallpaper repairs in the interior of the residence had not been performed. Mr. Rosenberg reviewed each of the photographs taken by Complainants and stated that the photographs were taken after Home Resort stated that it had completed all directed corrective work on Complainants’ residence. Mr. Rosenberg testified that the photographs accurately reflected the condition of Complainants’ residence at the end of 2011.[1] Mr. Rosenberg testified that interior and exterior painting performed by Home Resort failed to comply with applicable industry and workmanship standards. Mr. Rosenberg stated that the corrective painting should have been performed “wall-to-wall” rather than in patches. Laura Kirkwood (hereinafter “Ms. Kirkwood”) reviewed the enumerated items of the Corrective Work Order and the Addendum to the Corrective Work Order and testified that that she was not satisfied with the corrective work that had been performed by Home Resort. Ms. Kirkwood stated that the air leaks in the windows in Complainants’ residence had not been corrected. Ms. Kirkwood testified that Complainants and Home Resort had been unable to locate replacement wallpaper that matched the wallpaper in Complainants’ residence. Ms. Kirkwood stated that she understood that Home Resort would reimburse Complainants for the cost of removing and replacing the damaged wallpaper. Ms. Kirkwood testified that the parties were unable to reach a financial resolution for the removal and replacement of the damaged wallpaper. Ms. Kirkwood denied that she had ever had a conversation with Kelly Linfoot about selecting replacement wallpaper for Complainants’ residence. Ms. Kirkwood stated that Home Resort did not request that Complainants make a selection of replacement wallpaper. Ms. Kirkwood testified that she informed Home Resort that Complainants could not find replacement wallpaper that matched the existing wallpaper. Ms. Kirkwood stated that she also informed Home Resort that Complainants did not have enough excess original wallpaper to replace the wallpaper on their residence. Ms. Kirkwood testified that Complainants had “ideas” about replacement wallpaper but had not yet selected replacement wallpaper. Ms. Kirkwood stated that Complainants had not calculated the cost of replacing the wallpaper in their residence. Ms. Kirkwood acknowledged that Complainants received a November 29, 2011 letter from Home Resort’s attorney offering to pay Complainants $2,600.00 in lieu of replacing the wallpaper in Complainants’ residence.[2] Ms. Kirkwood testified that Complainants authorized Mr. Rosenberg to provide his estimate for the cost of replacing the wallpaper in their residence in response to Home Resort’s attorney’s letter. Ms. Kirkwood stated that Mr. Rosenberg’s estimate for the cost of replacing the wallpaper in Complainants’ residence was over $20,000.00. Ms. Kirkwood testified that Complainants always allowed Home Resort reasonable access to their residence. Ms. Kirkwood stated that Home Resort performed approximately seven to eight days of corrective work on Complainants’ residence. Ms. Kirkwood acknowledged that she video taped all of the work performed by Home Resort.[3] Ms. Kirkwood testified that she was never closer than eight to twelve feet to Home Resort’s employees. Ms. Kirkwood stated that the video taping was not an issue while Home Resort was performing corrective work on Complainants’ residence. Ms. Kirkwood testified that the only person who objected to the video taping was Chris Stump (hereinafter “Mr. Stump”) on the last day that Home Resort performed corrective work on Complainants’ residence. Ms. Kirkwood stated that she was approximately ten feet away from Mr. Stump when he confronted her about the video taping. Ms. Kirkwood acknowledged that Complainants denied Home Resort’s employees access to the bathrooms in Complainants’ residence. Ms. Kirkwood stated that the employees had the use of a “comfort station” approximately five minutes away from Complainants’ residence. Ms. Kirkwood’s testimony is found to be credible. Christopher Stump (hereinafter “Mr. Stump”) testified that he is employed by Home Resort as the project manager for northern Arizona. Mr. Stump stated that he served as the project manager for the corrective work that was performed at Complainants’ residence. Mr. Stump reviewed each item on the Corrective Work Order and the Addendum to the Corrective Work Order and testified that, with the exception of the wallpaper and drywall repairs to prepare the drywall for wallpaper; all corrective work had been properly completed by Home Resort. Mr. Stump stated that he was familiar with applicable workmanship and industry standards and that all corrective work performed by Home Resort complied with such standards. Mr. Stump testified that he personally inspected the entire project and that he observed that all corrective work had been properly completed. Mr. Stump testified that Home Resort had elected to have the wallpaper work performed by a specialty contractor. Mr. Stump stated that the wallpaper removal and replacement was not performed because Complainants failed to make a wallpaper selection. Mr. Stump testified that Home Resort would have removed and replaced the wallpaper in Complainants’ residence had the Complainants informed Home Resort of their choice of a replacement wallpaper. Mr. Stump acknowledged that he was not personally involved in the wallpaper issue. Mr. Stump testified that the Complainants interfered with the performance of the corrective work by taking videos and photographs of Home Resort’s employees performing the corrective work. Mr. Stump stated that he found the constant video taping to be disruptive and oppressive. Mr. Stump testified that he did not believe that it was possible to satisfy Complainants. Kelly Linfoot (hereinafter “Ms. Linfoot”) testified that she is employed by Home Resort as a finance manager and as a manager of consumer relations. Ms. Linfoot stated that she initially tried to find a match for Complainants’ wallpaper. Ms. Linfoot testified that she was unable to locate any wallpaper that would match the existing wallpaper installed in Complainants’ residence. Ms. Linfoot stated that she looked through thousands of wallpaper samples in an attempt to find a match to the existing wallpaper. Ms. Linfoot testified that she personally informed Ms. Kirkwood that she was unable to locate matching wallpaper for Complainants’ residence. Ms. Linfoot stated that she informed Ms. Kirkwood that Home Resort would replace all of the wallpaper in Complainants’ residence if Complainants would select replacement wallpaper. Ms. Linfoot testified that she offered to have an employee drop off catalogues of wallpaper selections at Complainants’ residence for their review. Ms. Linfoot testified that Home Resort placed no value limitation on the replacement wallpaper. Ms. Linfoot stated that Home Resort did not send a wallpaper contractor to Complainants’ residence to remove and replace the wallpaper because Home Resort did not know which replacement wallpaper to install. Ms. Linfoot testified that Complainants failed to select replacement wallpaper. Larry Chavez (hereinafter “Mr. Chavez”) testified that he is the president of Home Resort. Mr. Chavez stated that Home Resort had performed approximately 4,500 window replacement construction projects in the State of Arizona and another 10,000 window replacement projects in the State of New Mexico. Mr. Chavez testified that it is extremely rare for Home Resort to receive a customer complaint. Mr. Chavez testified that he assigned Home Resort’s very best construction crews to perform the directed corrective work on Complainants’ residence. Mr. Chavez stated that he had personally reviewed the corrective work performed at Complainants’ residence and that he believed that all of the corrective work performed by Home Resort was in compliance with applicable industry standards. Mr. Chavez testified that Home Resort elected to have the wallpaper work performed by a specialty contractor because the Complainants had extremely high expectations and Home Resort wanted to ensure that the installation of the new wallpaper would be performed to a very high standard. Mr. Chavez stated that he did not believe that it was possible for Home Resort to satisfy Complainants. Mr. Chavez testified that Ms. Kirkwood refused to speak with him on the telephone. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[4] Home Resort bears the burden of proof to establish by a preponderance of the evidence that it either fully complied with the Registrar’s Corrective Work Order and Addendum to the Corrective Work Order or that Complainants failed to provide reasonable access for it to do so.[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] Home Resort did not establish that the Complainants failed to provide reasonable access to allow it to comply with the Registrar’s Corrective Work Order and Addendum to the Corrective Work Order. Inspector Nieves inspected each of the items set forth in the Corrective Work Order and Addendum to the Corrective Work Order and observed that several items set forth in the Corrective Work Order and the Addendum to the Corrective Work Order had not been fully corrected. The exterior excess caulking between the exterior stucco and the doors and windows had not been fully corrected. The paint and drywall repairs did not match the surrounding area for color and texture. The drywall crack repairs and the wallpaper on the interior of the residence had not been corrected. Home Resort asserted that the corrective work on the drywall and wallpaper could not be performed because Complainants failed to select replacement wallpaper. Ms. Kirkwood informed Home Resort that Complainants could not find replacement wallpaper that matched the existing wallpaper. Complainants informed Home Resort that they did not have enough excess original wallpaper to replace the wallpaper on their residence. Complainants had “ideas” about replacement wallpaper but did not select replacement wallpaper. Complainants received a November 29, 2011 letter from Home Resort’s attorney offering to pay Complainants $2,600.00 in lieu of replacing the wallpaper in Complainants’ residence.[7] Complainants then authorized Mr. Rosenberg to provide his estimate for the cost of replacing the wallpaper in their residence in response to offer. Home Resort did not accept Mr. Rosenberg’s estimate. Ms. Kirkwood credibly denied that she had a conversation with Ms. Linfoot regarding the need for Complainants select replacement wallpaper. This Tribunal concludes that Home Resort failed to fully comply with the terms of the Registrar’s Corrective Work Order and Addendum to the Corrective Work Order. RECOMMENDed order In view of the foregoing, it is recommended that License No: B- 3.260542-R of Home Resort Living Of Arizona Inc (FN) shall be suspended for a period of two (2) days. . In the event of certification of this 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 the certification Done this day, September 25, 2014.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] See Exhibit Nos. P-1 through P-19 (Photographs). [2] See Exhibit R-18 (11/19/11 Letter). [3] See Exhibit C-1 (DVD). [4] See A.R.S. §§ 32-1151 to 32-1169. [5] See A.A.C. R2-19-119(B)(2); 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] See Exhibit R-18 (11/19/11 Letter).

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