ALJDEC decisions subject to certification as final

2011A-589-ROC · Registrar of Contractors · 2011-09-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 6, 2011, at 1:00 p.m. APPEARANCES: Complainant Ronnie Evans appeared on his own behalf; Respondent Stillbrooke Construction of Phoenix, Inc. did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure In December 2003, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC190975, Class B for residential general contracting to Stillbrooke Construction of Phoenix, Inc. (“Respondent”). Respondent’s address of record is 8801 Jefferson Street N.E., Building A, Albuquerque, New Mexico 87113-2438. On January 27, 2011, the Registrar received a complaint from Ronnie Evans (“Complainant”) against Respondent concerning a house that Respondent had constructed in 2007 or 2008 at 1464 South Colt Drive, Gilbert, Arizona. According to the complaint, Complainant closed escrow on the house on April 8, 2010. The relevant items of complaint were that three French doors at the front of the house on the second floor leaked every time it rained, damaging the interior carpet and plywood subfloor. The Registrar assigned the complaint to its inspector, Randy Cason, for investigation. Inspector Cason performed a jobsite inspection. On February 23, 2011, Inspector Cason issued a Corrective Work Order (“CWO”) that required Respondent within 15 calendar days to correct by appropriate means the three French doors so that they no longer leaked. The February 23, 2011 CWO also noted an addendum to the complaint that the front door leaked at the threshold, and required Respondent to correct it by appropriate means. Complainant submitted a formal request to the Registrar to issue a citation against Respondent. On April 26, 2011, the Registrar issued a Citation and Complaint against Respondent, charging violations of A.R.S. § 32-1154(A)(3), namely A.A.C. R4- 9-108, and (23). Respondent filed a timely written answer to the Citation and Complaint, denying any statutory violations. Respondent affirmatively alleged that Complainant lacked standing to make the complaint because no contractual relationship existed between the parties. In addition, Respondent alleged that the complaint was untimely because Respondent completed construction on the house in September 2007, and used the house as a model home until December 2009, when Respondent deeded the house to an investor in lieu of foreclosure; it was the investor, and not Respondent, that sold the house to Complainant. Lastly, Respondent alleged that it had arranged for a licensed contractor to repair the house on or about March 7 and 23, 2011. On May 4, 2011, Complainant requested that the Registrar amend the complaint to allege that several areas of the subfloor on the second story of the house were uneven. On May 19, 2011, Complainant again requested that the Registrar amend the complaint to allege three additional items of complaint, in relevant part as follows: (1) The exterior foundation near the kitchen had a steel rod protruding from it; (2) A wall in the loft area was out-of-plumb; and (3) Mold was under the carpets in front of the leaking French doors. On July 14, 2011, the Registrar amended the complaint to include the additional alleged deficiencies, and deemed Respondent to have denied them.

The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent state agency, for an evidentiary hearing. On July 21, 2011, the Registrar issued a Notice of Hearing, setting a hearing on September 6, 2011, at 1:00 p.m. The Registrar mailed a copy of the Notice of Hearing to Respondent at its address of record. A hearing was held on September 6, 2011. Inspector Cason testified. Complainant testified and submitted 18 exhibits. Respondent did not request to appear telephonically at the hearing and did not request that the hearing be continued. Although the hearing did not conclude until approximately 2:26 p.m., Respondent did not appear through an authorized officer, employee, or attorney, nor did Respondent contact the OAH. Consequently, Respondent did not present any evidence to defend its license. According to the Registrar’s electronic record, on January 1, 2010, Respondent’s license was suspended by operation of law for non-renewal and on January 1, 2011, the license expired. Hearing Evidence Inspector Cason testified that he performed a prehearing inspection on September 3, 2011. Inspector Cason testified that the front door no longer leaked at the threshold, but that the French doors still leaked. Inspector Cason testified that at the prehearing inspection he also inspected the additional items of complaint that the Registrar had amended the complaint to include. With respect to the allegedly uneven subfloor on the second story, Inspector Cason testified that Complainant had pulled back the carpet and carpet pad in the area in front of the French doors to expose the subfloor. Although the subfloor was slightly uneven, Inspector Cason testified that it was within the Registrar’s and industry standards. Inspector Cason testified that it appeared that someone had removed fasteners from the plywood subfloor and there was a little swelling at the end of the plywood. However, Inspector Cason testified that the subfloor was still firmly attached to the trusses and was structurally sound. Inspector Cason testified that Complainant complained that another area of the subfloor on the second story in front of the entry to the master bedroom was not level. However, because Complainant had not pulled back the carpet and carpet pad, Inspector Cason was unable to determine whether the subfloor in that area was out of level. Inspector Cason testified that the carpet tacking strips in the area of the floor in front of the leaking French doors that were exposed when Complainant pulled back the carpet and carpet pad were black. Inspector Cason testified that he could not say whether the black color was a result of mold, because Complainant had not had any tests performed on the strips. Inspector Cason testified that on the foundation of the house on the exterior near the kitchen, a piece of concrete had been knocked off when a redhead anchor bolt had been driven into the slab for framing. Inspector Cason testified that although the chipped concrete should be patched, the deficiency was cosmetic, not structural. Inspector Cason testified that there was a bow in a wall in the loft area and that the back side of the wall was plumb. Inspector Cason testified that the Registrar’s workmanship standards did not require walls to be perfectly plumb, and allows a bow of 3/8”. Inspector Cason testified that the bow in Complainant’s wall was exactly 3/8” and was within the Registrar’s standards. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[1] The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and Respondent is deemed to have received notice of the hearing.[2] The expired status of Respondent’s license does not deprive Complainant of his right to prosecute his complaint against Respondent or prevent the Registrar from determining the merits of Complainant’s complaint.[3] Complainant bears the burden of proof and must 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] Because Respondent failed to appear at the duly noticed hearing, it failed to sustain its burden to establish either of the affirmative defenses that it alleged in its written answer. Complainant established that Respondent’s initial construction of the French doors violated A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108,[7] and that Respondent’s failure to repair the French doors to comply with the February 23, 2011 CWO violated A.R.S. § 32-1154(A)(23).[8] Complainant also established that Respondent violated A.R.S. § 32- 1154(A)(3), specifically A.A.C. R4-9-108, in its failure to patch the chipped concrete on the exterior foundation near the kitchen. Respondent’s expired license status prevents it from performing or from hiring others to perform any further corrective work.[9]

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 revoke Respondent Stillbrooke Construction of Phoenix, Inc.’s License No. ROC190975. It is further recommended that the Registrar not revoke Respondent’s license and, instead, close Complainant Ronnie Evans’ complaint in Case No. 2011-589 if on or before the effective date of the Registrar’s final order, Respondent provides written proof that is satisfactory to the Registrar that it has paid Complainant, and Complainant has accepted, an amount of money that is sufficient to allow Complainant to hire an appropriately licensed contractor to repair the three leaking French doors and the chipped concrete on the exterior slab near the kitchen. It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(D).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s final order, the Registrar revoke Respondent’s license, effective on such 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 Respondent tenders payment of any outstanding prior civil penalty. 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, September 26, 2011.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See 32-1101 et seq. [2] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [3] See A.R.S. § 32-1154(C). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license . . . .” [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] It is unlawful for anyone without a contractor’s license in good standing to engage in contracting. See A.R.S. § 32-1151. “Contractor” is defined as anyone who “does himself or by or through others” performs construction. A.R.S. § 32-1101(A)(3) (emphasis added).

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