ALJDEC decisions subject to certification as final

2011A-5692-ROC · Registrar of Contractors · 2012-03-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 6, 2012

APPEARANCES: Complainant appeared on his own behalf; Respondent was represented by corporate President and Qualifying Party Brent Brooks.

WITNESSES: James Hennessy, ROC Inspector Salvatore Cerbone Brent Brooks

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant brings this action against Respondent alleging poor workmanship and failure to comply with a Corrective Work Order with regard to roof replacement work done by Respondent. Respondent denies the allegations. This tribunal entered the complaint file received from the Registrar of Contractors (“ROC”) into the record. The parties presented evidence, including Complainant’s Exhibits 1 through 3 (photographs), Respondent’s Exhibits 1 through 9,[1] and testimony from the witnesses cited above. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order finding violations and recommending provisional suspension of the license. FINDINGS OF FACT 1. Respondent is the holder of License No. KB-2.205821-D, a dual residential and small commercial contractor’s license issued by the ROC. The license authorizes Respondent to perform general residential and general small commercial construction. Brentwood Todd Brooks is the Qualifying Party. 2. In May 2011, Complainant hired Respondent to replace his shingle roof that was damaged after a hailstorm. They entered into a written contract that begins with a statement that Complainant authorizes Respondent “to make repairs and/or replacements as per proof of loss submitted to the Insurance Company covering said loss.” In a later section entitled, “Description of loss,” the one-page contract lists removal and replacement of shingles, removal and replacement of felt, and removal and replacement of rolled roofing, as well as removal and replacement of drip edge and ridge cap pending insurance approval. That section does not detail replacement of items such as vents, plywood, pipe jack flashing, and other items that are detailed in the insurance proof of loss documentation. A “Claim Amount” of $5,321.10 is then identified in the contract. Complainant put down a deposit of $2,509.55 at the time the contract was signed.[2] 3. Complainant believed that he had hired Respondent to perform the work described in the insurance documentation because of the references to it in the written contract. Specifically, he believed that Respondent would replace the items that the insurance documentation covered for replacement. Brent Brooks testified for Respondent that the contract was for an unknown price, but not to exceed the claim amount of $5,321.10. Respondent did not believe it was required to do the work as specifically described in the insurance documentation. Respondent believed that it could retain use of existing materials such as flashing and plywood that were, in Respondent’s judgment, still useable because Respondent was providing a warranty for the materials it was using on the roof. 4. Respondent performed the work, and Complainant was not happy with it. Complainant filed a complaint with the ROC. Among the allegations was a claim that Respondent had not replaced pipe jack flashings and plywood sheathing as per the insurance documentation referenced in the written contract.[3] 5. In October 2011, ROC Inspector Jim Hennessy inspected Respondent’s work and issued a Corrective Work Order (“CWO”). Of the twelve items on the CWO, several were not presented at hearing because they were no longer at issue (Items 5, 8, 10, and 12). In addition, two of the items (Items 2 and 11) had been repaired by Complainant and therefore, pursuant to Arizona Revised Statutes (A.R.S.) § 32-1155(C), Respondent cannot be cited for poor workmanship on those items because they have been modified by someone other than Respondent. For the items still at issue at hearing, the CWO states the following: 1. Exhaust cap through roof jacks not properly sealed The roof jacks are properly sealed, therefore there is no action required by the contractor.

. . .

The following items appear to be upgrade, contractor installed Modified Bitumen roofing (peal and stick), and did not charge extra. Therefore there is no action required by the contractor. 3. Remove rolled roofing, including dump fees. 4. Roll roofing- 15 lb. felt- cement- nails install & labor.

. . .

6. Digital satellite system- detach and reset. The contractor replaced 3 bolts and there should be four, it is the opinion of this inspector that should been replaced and properly secured as originally installed. Therefore the contractor is to correct by the appropriate manner.

The following complaint items were not corrected, therefore the contractor is to correct as per contract dated 05/18/2011 by the appropriate manner.

7. R & R sheathing – plywood ½ “ for warped decking patio roof. Approximately 9 sheets. 9. Flashing pipe jack. Replace new 8, only one replaced.

. . .[4]

6. Inspector Hennessy testified about what he found at the initial inspection in October 2011, and at a pre-hearing inspection on March 5, 2012. He found that the roof jacks had been properly sealed (Item 1) and that in October 2011, a bolt was missing from the satellite dish attachment to the flat patio roof (Item 6). In March 2012, he found that the missing bolt had been supplied and installed, but that Complainant was complaining about the manner of installation. Complainant complained that the bolts were put in with the nuts on the roof (up) side and the heads on bottom rather than the heads on the roof side and the nuts on bottom. When specifically asked whether that installation violated workmanship standards, Inspector Hennessy could not say that it did. 7. CWO Items 3 and 4 concern the flat roof over the back patio and the replacement of rolled roofing. Inspector Hennessy testified that Respondent installed a better material (Modified Bitumen) than what was called for in the insurance documents, giving Complainant an upgrade, without charging a different price. He did not believe any further action was required. 8. Finally, Inspector Hennessy determined that Items 7 and 9, concerning pipe jack flashing and plywood sheathing, must conform to the insurance documentation, which provided for replacement of eight flashings and nine sheets of plywood. Respondent replaced only one flashing and only three sheets of plywood. Therefore, he ordered corrective action. 9. This tribunal finds that Inspector Hennessy’s determinations in the CWO are supported by the record. Items 1, 3, 4, and 6 meet workmanship standards. Items 7 and 9 do not. 10. The written contract does not meet the minimum requirements for contract under A.R.S. § 32-1158(B) because it does not contain an estimated date of completion, a clear total price for the work, or a schedule for progress payments. In addition, this tribunal finds that the contract incorporates by reference the insurance documentation as to the scope of the work. Thus, Respondent was required to replace the flashings and plywood as identified in the insurance documentation, or receive a written change order to do otherwise. 11. Respondent has not complied with Items 7 and 9 of the CWO. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[5] Further, the standard of proof at hearing is by preponderance of the evidence.[6] Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that Respondent has violated the statutes cited in the Citation and Complaint.[7] Complainant has met that burden. 2. The Citation and Complaint alleges violations of A.R.S. § 32- 1154(A)(3) by way of Arizona Administrative Code (A.A.C.) R4-9-108. Those provisions require contractors’ work to meet minimum workmanship standards and require contractors to comply with CWOs. The evidence shows violation of those provisions as found above. 3. The Citation and Complaint also alleges violation of A.R.S. § 32- 1154(A)(13) by way of A.R.S. § 32-1158, which requires certain minimum elements in construction contracts. As found above, Respondent has violated those provisions. The ROC sent Respondent a warning letter regarding that provision on October 28, 2011. 4. Finally, the Citation and Complaint alleges violation of A.R.S. § 32-1154(A)(17), which prohibits knowingly contracting beyond the scope of one’s license. This charge was not pursued by Complainant at the hearing. However, the record contains a letter issued to Respondent by the ROC on October 28, 2011, that states that installing Modified Bitumen Self-Adhered Roofing (which was the upgrade given to the flat roof) requires a C-42 license classification. Furthermore, Respondent did not deny this charge in its Written Answer to Citation and Complaint, filed with the ROC on December 20, 2011. Therefore, the evidence supports a finding of violation. 5. Administrative notice is taken of Respondent’s prior license record as reflected on the ROC public website on March 23, 2012. That prior record shows that Respondent has held the license since March 2005 and has never been disciplined. As such, it is a good record. Because of this good record, this tribunal recommends no further sanction beyond the warning letters for the violations concerning the missing contract elements and work outside the scope of the license. 6. The appropriate sanction in this matter is to require Respondent to make the required corrections specified above (Items 7 and 9). If Respondent does not do so in a timely manner, the license should be suspended. A civil penalty for failure to comply with the CWO is warranted in the amount of $150.00. RECOMMENDED ORDER IT IS RECOMMENDED that License No. KB-2.205821-D, held by Brooks Construction Group, Inc. dba Right at Home Repair & Remodeling, be suspended beginning the effective date of the ROC Order until the ROC receives written proof that Respondent has corrected CWO Items 7 and 9 as discussed above, and the ROC accepts such written proof. IT IS FURTHER RECOMMENDED that if Respondent provides such written proof on or before the effective date of the ROC Order, the license suspension shall not take place, and case 2011-5692 shall be closed. IT IS FURTHER RECOMMENDED that, along with the provisional suspension above, Brooks Construction Group, Inc. dba Right at Home Repair & Remodeling pay a civil penalty of $150.00 to the ROC pursuant to A.R.S. § 32-1154(D). Failure to pay the entire amount of the civil penalty, on or before 30 days following the effective date of the ROC Order entered in this matter, shall result in the automatic revocation of Respondent’s license, effective on the deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless payment of any outstanding prior civil penalty is made.

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, March 23, 2012.

/s/ Eric A. Bryant Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Respondent’s Exhibits are found in Respondent’s Exhibit Package. [2] Complainant eventually paid the entire amount of $5,321.10. [3] The record contains documentation from a small claims court proceeding in which Respondent successfully sued Complainant for $1,000 as the remaining balance due on the contract at issue here after Complainant had paid Respondent $4,321.10. However, even if it could be read as a ruling that Respondent fulfilled the contract, the small claims judgment has no effect on this proceeding. As the Arizona Court of Appeals has recently noted in Clusiau v. Clusiau, 236 P.3d 1194, 255 Ariz. 247 (App. 2010), an issue found against a defendant in small claims court is not precluded from being litigated again in other forums. [4] Type settings appear as in original. [5] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [6] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [7] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996).

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