ALJDEC decisions subject to certification as final

2012A-1658-ROC · Registrar of Contractors · 2012-09-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 7, 2012, at 8:00 a.m. APPEARANCES: Complainant Harold J. Quinette appeared on his own behalf; Respondent Arizona Discount Solar LLC did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure The Arizona Registrar of Contractors (“the Registrar”) issued License No. C- 11.265201-R to Arizona Discount Solar LLC (“Respondent”). Respondent’s address of record is P.O. Box 13002, Casa Grande, Arizona 85130-1009. The Registrar received a Complaint from Harold J. Quinette (“Complainant”) against Respondent that set forth seventeen specific complaints about Respondent’s installation of solar panels on the roof of Complainant’s house at 43947 West Palo Abeto Drive in Maricopa, Arizona. According to the Complaint, the contract amount was $35,134.50 and although Complainant had paid Respondent only $26,134.50, Respondent had been paid in full. Complainant attached to his Complaint a report prepared by Green Fuel Technologies LLC, License No. K-11.252305-D (“Green Fuel”) that included most of Complainant’s specific complaints.[1] Green Fuel’s report did not list Complainant’s seventeenth specific complaint, which requested that Respondent be required to “[v]erify that all solar panel mounting rails brackets are installed and sealed to ensure roof warranty.” The Registrar assigned the Complaint to its inspector, Jeff Fleetham, for investigation. Inspector Fleetham performed a jobsite inspection on April 13, 2012. On April 16, 2012, Inspector Fleetham issued a Corrective Work Order (“CWO”) that required Respondent within 15 calendar days to perform certain corrective action, in relevant part as follows: Note: ED3’s (Utility) General For[e]man’s position on each item was considered, by this inspector, as a requirement of the utility and as such a requirement that the Respondent shall meet.

All systems must be installed per manufacturer’s installation instructions, utility requirements, local building codes, fire codes, and governmental zoning ordinances.

1. Reset panels to meet manufacturer's specifications of 8.2 to 16.4 inches from corner of panel to rail mounting. • Panels not mounted per manufacturer’s installation instructions/requirements • Respondent shall correct by appropriate means.

2. Remove #8 THWN-2 wires and install correct size wire (#6) in 200- amp meter socket. • Not installed per manufacturer’s installation instruction/ requirements. • Respondent shall correct by appropriate means.

3. Properly secure PV NC disconnect box to wall. • Box is not secure[ly] attached to structure. • Respondent shall correct by appropriate means.

4. As per PV system plans, install two neutral conductors down from roof. Currently only one neutral conductor installed. • Not installed per approved drawings/specification[.] • Respondent shall correct by appropriate means.

5. Remove #10 THWN-2 neutral wire from PV Combiner Panel and install correct size (#8) neutral wire. • Not installed per manufacturer’s installation instructions/ requirements. Box requirements specify #6 wire. • Respondent shall correct by appropriate means.

6. Install missing bond bushing(s) at service entrance. • Missing bond bushings per manufacture[r’]s installation instructions. • Respondent shall correct by appropriate means.

7. As designated in plans, crimp GEC to the A/C uffer. (sp) • Not installed per manufacturer’s installation instructions/ requirements[.] • Respondent shall correct by appropriate means.

8. Bring wiring in PV Combiner Box up to workman standards by routing wires to shortest length. • No deficiency demonstrated or observed at time of inspection. • No action required by the Respondent.

9. Install WEEBS as required per manufacturer[‘]s specifications. (turn them 90 degrees) • WEEBs are not installed per manufacturer’s installation instruction/requirements[.] • Respondent shall correct by appropriate means.

10. Seal GEC from racking into J-Box. • Hole drilled into side of box[.] • Respondent shall correct by appropriate means.

11. Attach conduit clamp to roof. • Strap not attached to roof. Conduit not properly mounted and secured on roof. • Respondent shall correct by appropriate means[.]

12. W[h]ere possible install wires into mounting rails, remaining wires should be lifted from resting on roof and secured to mounting rails using zip ties. • Not installed per manufacturer’s installation instruction/ requirements[.] • Respondent shall correct by appropriate means.

13. Properly secure Enphase trunk line in the J-Box. • Conductor sheath is cut short and not properly secured in junction box. • Not installed per manufacturer’s installation instruction/ requirements[.] • Respondent shall correct by appropriate means.

14. The double lugged GEC should be reworked using a[n] irreversible crimp. • Not installed per manufacturer’s installation instruction/ requirements[.] • Respondent shall correct by appropriate means.

15. To improve workman standards and aesthetics cut mounting rails close as possible to racking. • No deficiency demonstrated or observed at time of inspection. • No action required by the Respondent.

16. Conduit fittings should be rated as wet location. Enphase • Not installed per manufacturer’s installation instruction/ requirements[.] • Respondent shall correct by appropriate means.

17. Verify that all solar pane[l] mounting rail bracket[s] are installed and sealed to ensure roof warranty. • No deficiency demonstrated or observed at time of inspection. • No action required by the Respondent.

18. ADDENDUM – Roof track not installed per manufacturers instructions. • Splice system not installed per manufacturer’s installation instruction/requirements – one bolt has not been removed to facilitate expansion and contraction of metal track. • Respondent shall correct by appropriate means.

On April 20, 2012, Inspector Fleetham issued an Amended CWO that included the same 18 items with the following prefatory language added: AMENDMENT – License 265201 issued to Arizona Discount Solar LLC was suspended for LLC dissolved on 4/20/2012 and cannot do or subcontract the following corrective work until suspension is lifted.

On or about May 3, 2012, the Registrar received Complainant’s formal request to issue a citation against Respondent because it had not performed any of the work required by the CWO. The Registrar issued a Citation and Complaint against Respondent charging violations of A.R.S. § 32-1154(A)(2), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(23). Respondent filed a timely written answer to the Citation and Complaint, denying any statutory violations. The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent state agency, for an evidentiary hearing. On July 30, 2012, the Registrar issued a Notice of Hearing, setting a hearing on September 7, 2012, at 8:00 a.m. The Registrar mailed a copy of the Notice of Hearing to Respondent at its address of record. On or about August 10, 2012, Respondent’s qualifying party and member, Lee Winsor, moved to continue the hearing to allow Respondent more time to hire an attorney. Mr. Winsor provided an e-mail address for correspondence relating to the Complaint because he would be out of the country until August 24, 2012, and would not receive regular mail. Complainant opposed Respondent’s motion to continue. On August 13, 2012, the Administrative Law Judge issued an order denying Respondent’s motion to continue. The OAH’s staff sent copies of the order to Respondent’s address of record and to the e-mail address that Mr. Winsor had provided. A hearing was held on September 7, 2012. Inspector Fleetham testified. Complainant testified on his own behalf, presented the testimony of Phillip Ramsey, the qualifying party and an employee of Green Fuel, and submitted exhibits. Respondent did not request to appear telephonically at the hearing. Although the start of the hearing was delayed fifteen minutes to allow Respondent additional travel time, Respondent did not appear through an authorized member, employee, or attorney. Consequently, Respondent did not present any evidence to defend its license. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website on September 20, 2012. Such prior License record reflects that after Respondent’s license was suspended for the LLC being dissolved, as Inspector Fleetham noted on the amendment to the CWO, on May 16, 2012, Respondent’s license was suspended for lack of bond and on August 1, 2012, Respondent’s license was suspended for non- renewal. Three complaints were pending against Respondent’s license. Hearing Evidence Complainant testified that Respondent’s installation of the solar panel system on his roof resulted in a rebate from the City of Maricopa in the amount of $3,000.00 and a “sunny rebate” in the amount of $6,000.00. Because Complainant assigned the rebates to Respondent, Complainant’s out- of-pocket cost for the solar panel system was reduced $9,000.00. The CWO did not require Respondent to perform corrective action on Item No. 17, Complainant’s request that solar panel mounting rail bracket that Respondent had installed be inspected to ensure that the warranty on the roof was not voided. Complainant submitted a proposal from Specialty Roofing, Inc., License No. C-42.031957-R (“Specialty Roofing”), dated August 28, 2012, that contained the opinion that “[t]he stanchions installed on this home are not properly sealed as per the manufactures [sic] specifications attached[.] Per the ROC, all roof atachments [sic] should be installed by a licensed roofer.”[2] No one from Specialty Roofing testified at the hearing. Specialty Roofing attached to its proposal an excerpt from the Registrar’s requirements for “Solar Contracting” from the public website. Complainant highlighted the statement that “any devices (solar or otherwise) mounted on the roof that significantly impacts, may compromise the roof components or may void the existing roof warranty, may require inspection and/or installation by a licensed roofing contractor.” Inspector Fleetham pointed out that the excerpt expressed a possibility that the installation of solar panels on a roof might compromise the roof and void the warranty, rather than categorically stating that such installation would void the warranty unless a roofing contractor installed or inspected the roof attachments. Specialty Roofing proposed to remove and reinstall Complainant’s existing concrete tile, remove and replace existing wood battens, install #40 ASTM felt over the roof, seal all new solar stanchions, install new aluminum secondary flashings for roof penetrations as needed, and to install hip and ridge seal per the manufacturer’s specifications, for a price of $3,240.00. Inspector Fleetham testified that because Specialty Roofing would benefit economically if Complainant accepted its proposal, the opinion stated in the proposal should be discounted. Specialty Roofing also attached to its proposal photographs that purported to show deficiencies in Complainant’s roof where the concrete tile had been removed. Inspector Fleetham testified that the report was prepared months after he performed the jobsite inspection and that he did not know the vantage point from which the photographs had been taken. Inspector Fleetham testified that because there was no evidence that Specialty Roofing installed the roof on Complainant’s house, its statement concerning the effect of Respondent’s installation of the solar electric panels on the roof of the house on the roof warranty was not conclusive. Inspector Fleetham testified that no deficiency in the roof was observed or demonstrated at the jobsite inspection and that it is not his job to search out deficiencies, but only to investigate reported deficiencies based on the evidence that was available at the time. Mr. Ramsey pointed out on photographs that Complainant submitted some of the deficiencies noted in Green Fuel’s report. Mr. Ramsey did not testify that applicable code, the manufacturer’s specifications, or industry standards required correction of the items that Inspector Fleetham’s CWO did not require Respondent to correct , specifically, CWO Item Nos. 8, 15, and 17. Mr. Ramsey testified that the solar panels that Respondent installed on Complainant’s roof are operational and are presently running. Complainant testified that he has made a claim against Respondent’s bond,[3] but that the bonding company is waiting for the outcome of his Complaint to the Registrar before processing the claim. Complainant submitted four proposals to remove and to correctly install the solar electric panels on his roof, as follows: (1) A proposal from Green Fuel dated April 20, 2012, in the amount of $5,227.87;[4] (2) A proposal from American Solar Electric, Inc., License No. K-11.168657-D dated May 8, 2012, in the amount of $3,925.87;[5] (3) A proposal from Sun Valley Solar Solutions, LLC, License No. K-5.223865-D for solar electrical equipment dated May 25, 2012, in the amount of $5,310.00;[6] and (4) A proposal from Black Platinum Solar and Electric, Inc., License No. C- 11.232364-R, dated September 6, 2012, in the amount of $7,970.85.[7] Complainant also submitted Green Fuel’s invoice dated August 21, 2012, in the amount of $170.00 for Mr. Ramsey to testify at the hearing[8] and Specialty Roofing’s invoice dated August 21, 2012, in the amount of $225.00 for a roof inspection.[9] CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[10] The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and Respondent appears to have received actual notice of the hearing.[11] The administratively suspended 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.[12] Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence.[13] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[14] Complainant established that Respondent’s construction of the solar electric panel system on his roof was deficient in the specific respects found in CWO Item Nos. 1, 2, 3, 4, 5, 6, 7, 9, 10, 11, 12, 13, 14, 16, and 18. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(2)[15] and A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108.[16] Complainant also established that Respondent failed to repair the deficiencies to comply with the CWO, in violation of A.R.S. § 32- 1154(A)(23).[17] The Registrar may award restitution in the amount of the cost to repair a licensee’s workmanship deficiencies that violate applicable statute if the licensee cannot remedy statutory violations by performing corrective work.[18] Respondent’s administratively suspended license status prevents it from performing or from hiring others to perform any corrective work.[19] The legislature has not authorized the Registrar to adjudicate or award consequential money damages, expert fees, or other costs of proceeding to a hearing.[20] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Registrar’s Order in this matter, Respondent Arizona Discount Solar LLC’s License No. C-11.265201-R shall be revoked. It is further recommended that if on or before the effective date of the Order, Respondent provides written proof that the Registrar finds acceptable that Respondent has paid Complainant Harold J. Quinette the sum of $3,925.87 in certified funds, Respondent’s license shall not be revoked but, instead, Complainant’s Complaint in Case No. 2012-1658 may be closed. 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 shall 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 20, 2012. /s/ Diane Mihalsky Administrative Law Judge Transmitted electronically to: William A. Mundell, Director Registrar of Contractors ----------------------- [1] See Complainant’s Exhibit C-3. [2] Complainant’s Exhibit C-2. [3] See Complainant’s Exhibit C-27. [4] See Complainant’s Exhibit C-35. [5] See Complainant’s Exhibit C-36. American Solar Electric, Inc. also holds License No. K-42.236520-D for roofing but its proposal did not include any roof repair. [6] See Complainant’s Exhibit C-37. [7] See Complainant’s Exhibit C-40. [8] See Complainant’s Exhibit C-39. [9] See Complainant’s Exhibit C-38. [10] See A.R.S. §§ 32-1151 to 32-1169. [11] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [12] 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 . . . .” [13] 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). [14] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [15] A.R.S. § 32-1154(A)(2) 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.” [16] 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.” [17] 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.” [18] See A.R.S. § 32-1156.01; Sunpower of Arizona v. Arizona Registrar of Contractors, 166 Ariz. 437, 441, 803 P.2d 430, 434 (App. 1990). [19] 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). [20] See J.W. Hancock Enterprises, Inc. v. Arizona State Registrar of Contractors, 142 Ariz. 400, 406, 690 P.2d 119, 125 (App. 1984). Although successful parties may recover such damages and costs in superior court under A.R.S. Title 12, which governs courts and civil proceedings, see A.R.S. § 12-341, Title 12 does not apply to an administrative claim filed with the Registrar. See Semple v. Tri-City Drywall, Inc., 172 Ariz. 608, 611-612, 838 P.2d 1369, 1372-73 (App. 1992).

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