ALJDEC decisions subject to certification as final

2011A-5489-ROC · Registrar of Contractors · 2012-08-15

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 27, 2012, at 8:00 a.m. APPEARANCES: Complainant J A B Fitness appeared through Brandon Spencer, its owner and general manager; Respondent Alliance Flooring Sales LLC appeared through Joel Dryden, its qualifying party and member. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure 1. The Arizona Registrar of Contractors (“the Registrar”) issued License No. C-8.231911-R for residential floor covering to Alliance Flooring Sales LLC (“Respondent”). 2. J A B Fitness (“Complainant”) operates a commercial fitness facility at 7305 South Kyrene Road, Suite 112, Tempe, Arizona, that specializes in boxing, kickboxing, and other martial arts. 3. The Registrar received a complaint from Complainant alleging four specific complaints about Respondent’s installation of carpet at the fitness facility. 4. The Registrar’s assigned inspector, Beau Cruz, performed a jobsite inspection. On October 12, 2011, Inspector Cruz issued a Corrective Work Order (“CWO”) that required Respondent to take corrective action with respect to one of Complainant’s complaints within 15 calendar days, in relevant part as follows: The contractor is to correct the following by the appropriate means

#2. The carpet is unraveling at the seams. (This was something we asked up front to be sure this would not happen). Contractor was informed of this on March [11]: Unraveling of the carpet in the Kick Boxing Room area at the seams[’] locations. Although unraveling is due to heavy use in this area, contractor did not have [to] agree to install material as per complainant[’]s request and had the option to advise alternate material that is more suitable to install in the Kick Boxing Room that would withstand type of traffic or use.

No action required of the following

#1. The carpet was installed incorrectly and a different way than agreed upon. (Used shorter rolls and created more seams): Complainant stated or alleged that [it] was verbally informed that respondent (salesperson) would use larger (wider) rolls, (16 foot wide carpet roll) rather that the standard 12 foot rolls so as to not have two seams. No documentation was presented to show that this was discussed, and in this inspector’s opinion, would still have necessitated two seams when installing due to the width of the Kick Boxing Room (16' 10'' wide), therefore contractor installed carpet as per contract and per common industry standards. It should also be noted, that complainant stated that he agreed to the 12 foot rolls in lieu of the 16 foot rolls, and was only making statement of issue to show that the unraveling would not have occurred if [Respondent] had used 16 foot rolls as [Complainant] had stated that was allegedly verbally agreed upon.

#3. Contractor does not return calls or meet when scheduled: Inspector does not have the authority to direct respondent to return calls scheduled meetings or how he decides to implement customer service.

#4. Contract price changed after agreed price: Complainant stated at the jobsite inspection that does not have an issue with the agreed final price.

5. On or about April 9, 2012, Inspector Cruz sent a letter to Respondent stating that it had contracted beyond the scope of its residential C-8 license when it installed carpet in Complainant’s commercial facility. 6. On or about April 16, 2012, the Registrar issued a Citation and Complaint against Respondent charging A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, A.R.S. § 32- 1154(A)(13), namely A.R.S. § 32-1124(B), A.R.S. § 32-1154(A)(17), and A.R.S. § 32- 1154(A)(23). 7. On or about April 27, 2012, the Registrar received the timely written answer to the Citation and Complaint filed by Respondent’s qualifying party and member, Joel Dryden. Mr. Dryden stated that he did not know that he needed a separate license to perform commercial work. Mr. Dryden attached to Respondent’s written answer a copy of a completed application for a commercial L-8 license.[1] 8. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. 9. A hearing was held on July 27, 2012. Inspector Cruz testified. Complainant’s owner and general manager, Brandon Spencer, testified and submitted seven exhibits. Mr. Dryden testified on Respondent’s behalf and submitted nine exhibits. 10. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website. Such prior License record reflects that on August 15, 2012, Respondent’s license was current. Hearing Evidence 11. Mr. Spencer testified that he holds a roofing license.[2] Mr. Spencer testified that he called Respondent to install carpet in Complainant’s fitness facility because his roofing company and Respondent are both in a barter group and he wanted to use barter credits for the transaction. 12. Mr. Spencer testified that before he opened Complainant’s fitness facility, he was the general manager of an LA Boxing franchise in the Phoenix area. Complainant submitted photographs of LA Boxing’s fitness facility that showed carpeted floors and gaffers tape over the carpet seams and elsewhere. Mr. Spencer testified that he told Respondent’s salesman, whose name he did not remember, to look at the carpet in LA Boxing’s fitness facility because he did not want Complainant’s floor to look that way. 13. Mr. Spencer testified that Respondent’s salesman showed him three samples and that he selected the premium sample to avoid having to use gaffers tape to prevent the carpet seams from unraveling. Mr. Spencer also testified that Respondent’s salesman promised that Respondent would use 16’ wide rolls to minimize the number of seams that were required on the project. 14. Respondent submitted its November 23, 2010 written proposal to install glue-down, “Entry Level” carpet directly on the concrete floor at Complainant’s fitness facility. The proposal did not specify the width of the carpet rolls that Respondent would use in the installation or provide any special warranties. 15. Mr. Spencer signed to accept the proposal on Complainant’s behalf. At Mr. Spencer’s request, Respondent later modified the proposal to install a 6” vinyl cove base rather than the 4” base specified in the initial proposal. Respondent did not modify the proposal to upgrade the carpet, to specify roll width, or to provide any special warranties. 16. Respondent’s proposal and modified proposal did not show Respondent’s license number preceded by the acronym “ROC.” 17. Mr. Spencer and Mr. Dryden agreed that in January 2011, right after Respondent installed the carpet at Complainant’s fitness facility, the carpet looked good. 18. Mr. Spencer testified that the carpet at Complainant’s fitness facility presently looks terrible. Because seams and other areas are unraveling, he must use gaffers tape to avoid tripping hazards. 19. Mr. Dryden agreed that the carpet at Complainant’s fitness facility presently is in terrible shape. Respondent submitted photographs that showed damage to the carpet in areas away from the seams and seams that were not visible. Mr. Dryden testified that the only way the damage to the carpet could have occurred was if loose fibers on the carpet had been left untrimmed for days or weeks. Mr. Dryden testified that proper carpet maintenance requires that loose fibers be trimmed to avoid extensive unraveling. Mr. Dryden testified that at the prehearing jobsite inspection on July 20, 2012, he counted 17 areas where he could see loose, untrimmed fibers where the carpet was poorly maintained. 20. Complainant submitted a signed letter from Mike Ewalt, the owner of Shaggy’s Carpet Service, who maintains the carpets at Complainant’s fitness facility. Mr. Ewalt’s letter stated that he did not think that Complainant was doing anything wrong in the cleaning, shampooing, vacuuming, and cutting loose threads of the carpet, and that the cause of the carpet’s poor appearance was Respondent’s improper installation of a product that was not suited to the installation. 21. Inspector Cruz testified that at the prehearing inspection on July 20, 2012, he toured the kickboxing area of Complainant’s fitness facility. Inspector Cruz testified that in his opinion, Respondent had performed repairs to comply with the CWO. Inspector Cruz testified that carpet looked pretty good where gaffers tape had been applied to the carpet seams and elsewhere. 22. Inspector Cruz testified that at the prehearing inspection, he saw that the carpet was unraveling in areas that were not on the seams and that this damage had not been present at the initial jobsite inspection. Inspector Cruz testified that the carpet that Respondent installed was a commercial grade that was designed to withstand heavy traffic, but that martial arts required participants to plant and move their feet frequently, with a lot of twisting and spinning. Inspector Cruz noted that the laws of physics state that for every action, there will be an opposite reaction, as seen in the unraveling of the carpet. Inspector Cruz testified that in his opinion, Respondent had not violated A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, or A.R.S. § 32-1154(A)(23) in its installation or repair of the carpet at Complainant’s fitness facility. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[3] Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence.[4] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[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] It appears that Complainant elected to install an entry level commercial carpet in an area where it would be subjected to extraordinary use. It also appears that Respondent repaired the carpet to comply with the Registrar’s standards. The appearance of the carpet is similar to the appearance of carpets in comparable fitness facilities. Therefore, Complainant did not establish that Respondent violated A.R.S. § 32- 1154(A)(3), namely, A.A.C. R4-9-108,[7] or A.R.S. § 32-1154(A)(23)[8] in its initial installation of and repairs to the carpet at Complainant’s fitness facility. The record establishes that Respondent violated A.R.S. § 32-1154(A)(13), namely A.R.S. § 32-1124(B),[9] by not including its license number preceded by the acronym “ROC” on its November 23, 2010 proposal and its modified proposal. Mr. Dryden acknowledged that installation of carpet at a commercial property like Complainant’s fitness facility was beyond the scope of Respondent’s residential C-8 license, but stated in the written answer that he was unaware of the violation until he received Inspector Cruz’s April 9, 2012 letter. “‘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.”[10] “‘Notice 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.’”[11] Because Respondent should have known that its residential license did not allow it perform contracting on a commercial project, the record establishes that Respondent violated A.R.S. § 32-1154(A)(17).[12] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Registrar’s Order, Respondent Alliance Flooring Sales LLC’s License No. C-8.231911-R be suspended until Respondent provides written proof that is satisfactory to the Registrar that Respondent has remedied its violations of A.R.S. 32-1154(A)(13), namely A.R.S. § 32-1124(B), and A.R.S. § 32-1154(A)(17). It is further recommended that the Registrar not suspend Respondent’s license and, instead, close Complainant J A B Fitness’s complaint in Case No. 2011-5489 if on or before the effective date of the Registrar’s Order, Respondent provides written proof that is satisfactory to the Registrar of both of the following: 1) Respondent has revised its website, estimate form, contract form, invoice form, proposal form, business cards, letterhead, advertising, and any other documents used in its contracting business to comply with the requirements of A.R.S. § 32-1124(B); and 2) Respondent has not engaged in any contracting activities that were beyond the scope of its residential C-8 license since April 9, 2012, or has obtained a commercial or dual license that allows it to perform such work. It is further recommended that, in addition to any license suspension that may result from this matter, Respondent’s Class C-8 license be placed on disciplinary probation for a period of 180 days, commencing on the effective date of the Registrar’s order or the date on which Respondent files notice of compliance, whichever is later. 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, August 15, 2012.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] The Registrar’s date stamp on the license application that was attached to Respondent’s written answer was the same as the date stamp on the written answer. No evidence indicates that Respondent submitted the application to the Registrar separately for processing with the required fee. [2] The Registrar’s public website reflects that License No. K-42.244850-D was issued to Spencer 4 Hire Roofing LLC, with Brandon Lee Spencer listed as a member. [3] See A.R.S. § 32-1151 to A.R.S. § 32-1169. [4] 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). [5] See A.A.C. R2-19-119(B)(2). [6] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [7] A.R.S. § 32-1154(A)(3) 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.” A.A.C. R4-9-108 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] A.R.S. § 32-1154(A)(23) 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.” [9] A.R.S. § 32-1154(A)(13) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” A.R.S. § 32-1124(B) requires that licensed contractors include their license number “preceded by the acronym ‘ROC’“ on “all written bids submitted by the licensee and . . . on all advertising, loan forms, lending institution forms, letterheads and other documents used by the licensee in the conduct of business regulated by this chapter.” [10] A.R.S. § 1-215. [11] Maricopa Utilities Co. v. Cline, 60 Ariz. 209, 214, 134 P.2d 156 (1943) (quoting Schneider v. Henley, 61 Cal. App. 758, 763, 215 P. 1036, 1038 (1923)). [12] A.R.S. § 32-1154(A)(17) 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.”

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