ALJDEC decisions subject to certification as final

2012A-2985-ROC · Registrar of Contractors · 2013-02-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 17, 2013, at 8:00 a.m. APPEARANCES: Complainant Mark Goodfarb appeared on his own behalf; Respondent Sound and Video Contractor LLC appeared through Bruce Alan Harmsen, its qualifying party and member. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure The Registrar of Contractors (“the Registrar”) issued to Sound and Video Contractor LLC License No. K-67.180099-D (“Respondent”). On or about June 13, 2012, Mark Goodfarb (“Complainant”) filed a Complaint with the Registrar against Respondent regarding its failure to complete its contract to “[r]ewire entire home with cat 5e and coax and camera wire for the whole home matrix for video over cat5 to HDMI” at Complainant’s house at 11620 South Tonalea Drive, Phoenix, Arizona. According to the Complaint, the date of the parties’ contract was February 20, 2012, Respondent had last performed work on the project on March 8, 2012, the contract was both written and verbal, and Complainant had paid Respondent in full for the amount of the contract, $1,850.00. The Registrar assigned the Complaint to its inspector, Jeff Wills, for investigation. Inspector Wills performed a jobsite inspection on July 10, 2012. Respondent’s representative did not attend the jobsite inspection. At the jobsite inspection, Complainant informed Inspector Wills of the alleged terms of the parties’ contract and added one item to the Complaint.

On July 11, 2012, Inspector Wills issued a Corrective Work Order (“CWO”) to Respondent, directing it within fifteen calendar days to complete or repair the following items: CONTRACTOR TO CORRECT BY APPROPRIATE MEANS THE FOLLOWING:

1. The 4 cat 5e wires to the patio will not carry a signal, sound or video. I want 4 new cat 5e wires pulled in, labeled, tested and installed: Contractor to correct by appropriate means.

2. Conduit to the main phone D-mark box was promised and not installed, I want it installed: Contractor to correct by appropriate means.

3. Fix all drywall holes and paint to match: As pointed out by the Complainant, the hole in the drywall remains in the office. Contractor to correct by appropriate means all remaining drywall issues pertaining to work performed.

4. Reimbursement for all materials I have paid for to finish the job that Mr. [Harmsen] did not finish, see attached receipt dated 4-24-12: The Complainant pointed out to the inspector several items/issues that he himself has repaired or hired other contractors to repair. These items include various interior and exterior drywall and paint repairs, roof repairs, exterior wiring and conduit repairs related to the Respondent[’]s scope of work. Per the Complainant, some of these repairs were of safety concerns and needed correction immediately. This inspector does not have the authority to order any party to refund, reimburse, credit, etc. any monies.

This item was added to the complaint by the Complainant at the time of the inspection. Contractor was not present for the inspection.

1. Respondent notched section of truss at vaulted ceiling of family room: Per the Complainant, the Respondent, in order to be able to run wiring, notched a section of this truss without installing a nail plate: Contractor to correct by appropriate means.

After Respondent did not complete the project to Complainant’s satisfaction, the Registrar issued a Citation and Complaint against Respondent charging possible violations of A.R.S. § 32-1154(A)(1), 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. § 32-1158, 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, an independent agency, for an evidentiary hearing. A hearing was held on January 17, 2013. Inspector Wills testified. Complainant submitted six exhibits and presented the testimony of two witnesses: (1) Himself, and (2) Dennis Phillip Porter, the qualifying party and officer of Porter Roofing Inc., License No. K-42.152111-D (“Porter Roofing”). Respondent submitted one exhibit and presented the testimony of two witnesses: (1) Bruce Alan Harmsen, Respondent’s qualifying party and member; and (2) Joseph Zahn, Respondent’s employee on the project, who also works for his father’s company, Active Burglar Alarm Co., License No. L-67.105505-C. Additional Evidence Complainant works from home and has extensive computer and communications electronic equipment in his home office. Complainant hired Porter Roofing to replace the roof on his house. Mr. Porter testified that because low voltage wire was strewn all over the existing roof, he recommended that during the roof replacement project, Complainant should hire a low voltage communications system contractor to install the wires underneath the new roof. Mr. Porter referred Complainant to Respondent. Mr. Harmsen testified low voltage system jobs are performed in three stages: (1) Prewire, (2) Trim, and (3) Final completion. Mr. Harmsen testified that he discussed Respondent’s possible scope of work with Complainant and prepared a proposal for all three stages in the total amount of $5,450.37.[1] Complainant did not accept Respondent’s proposal to perform the entire job. Instead, Mr. Harmsen testified that Complainant requested that Respondent perform certain work on a time-and-material basis. No document memorialized the parties’ agreement. Mr. Harmsen testified that Respondent performed a custom integration installation in which it installed the low voltage wire for various electronic equipment but did not determine the final location of the equipment, install the equipment, or perform the trim and final completion stages for the project. On or about February 20, 2012, Respondent submitted an invoice to Complainant to install various low-voltage wires for various electronic equipment in the total amount of $1,850.00, including a cash discount in the amount of $205.00.[2] The February 20, 2012 invoice does not describe the installation of any electronic equipment, trim, or finish work. Complainant paid the invoice. On or about April 23, 2012, Respondent submitted a second invoice for cable installation for a camera system in the total amount of $250.00. The April 23, 2012 invoice does not describe installation of any electronic equipment, trim, or finish work. Complainant paid the invoice. Complainant testified that Respondent verbally agreed to complete the entire project for the amounts set forth in its invoices. Mr. Harmsen testified that Respondent only agreed to pre-wire the house under the roof on a time-and-material basis and that its work totaled the amounts set forth on its invoices. Mr. Harmsen testified that Complainant agreed that he would perform the trim and final completion of the project. Mr. Harmsen testified that although the trim stage involves terminating wires and Respondent did not contract to perform trim work, he terminated some wires to get Complainant’s home office up and running. Mr. Zahn testified that he was present during at least some of the parties’ discussions and that the parties decided that it would be best to power up the cable for the security camera on the patio and that Complainant could decide on a location for the camera when he performed the trim. With respect to the allegedly notched truss that Complainant added at the jobsite inspection, Inspector Wills and Mr. Porter testified that because the alleged notch was covered by drywall, they did not verify that the notch existed but instead took Complainant’s complaint at face value. Mr. Harmsen testified that all the low voltage wires that Respondent had installed in Complainant’s house worked. Complainant submitted an e-mail from Respondent dated June 14, 2012, stating that he would look at the job and see if he could do anything to resolve Complainant’s Complaint, but that he had not been receiving e- mails, his phone was a mess, his father had just passed away, and his sister was sick.[3] Inspector Wills testified that after the jobsite inspection, he attempted to contact Respondent by telephone but that no one answered the phone and he could not leave a message because Respondent’s mailbox was full. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website. Such prior License record reflects that as of February 6, 2013, License No. K-67.180099-D was current and that one complaint was pending against the license. CONCLUSIONS OF LAW 1. This matter lies with the Registrar’s jurisdiction.[4] 2. Complainant bears the burden of proof to establish Premier’s statutory violations by a preponderance of the evidence.[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] 3. Complainant did not establish that Respondent contracted to rewire his entire house, including trim and installation of electronic equipment. Therefore, Complainant did not establish that Respondent abandoned the project in violation of A.R.S. § 32-1154(A)(1).[7] 4. Complainant did not establish that any of the low voltage wires that Respondent installed did not function as intended or that Respondent notched the truss in the family room and failed to install a metal plate over the notch. Therefore, Complainant did not establish that Respondent failed to perform its work in a professional and workmanlike manner in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108.[8] 5. Respondent’s limited scope of work provides a legal justification for its failure to complete the project to Complainant’s satisfaction to comply with the CWO. Therefore, Complainant did not establish that Respondent violated A.R.S. § 32-1154(A)(23).[9] 6. A.R.S. § 32-1158 requires contractors to provide written contracts to memorialize their agreements with property owners in amounts of $1,000.00 or more, and if their agreement is on a time-and-material basis, to anticipate that the final amount of the agreement will exceed $1,000.00.[10] A.R.S. § 32-1158 also requires contractors to include certain terms in their written contracts with property owners in the amount of $1,000.00 or more. Because Respondent did not memorialize in a written contract its verbal agreement to install prewiring in Complainant’s house on a time-and-materials basis and the final amount of the contract exceeded $1,000.00, Respondent violated A.R.S. § 32-1154(A)(13),[11] namely A.R.S. § 32-1158. RECOMMENDED ORDERS In view of the foregoing, it is recommended that on the effective date of the Registrar’s Order, Respondent Sound and Video Contractor LLC’s License No. K-67.180099-D shall be suspended until it has remedied its violation of A.R.S. § 32-1154(A)(13), namely A.R.S. § 32-1158, by modifying its business practices to memorialize in writing all contracts with property owners in the amount of $1,000.00 or more and by including in such written contracts all of the terms required by A.R.S. § 32-1158(B). It is further recommended that if on or before the effective date of the Registrar’s Order, Respondent provides written proof that is acceptable to the Registrar that it has modified its business practices to memorialize in writing all contracts with property owners in the amount of $1,000.00 or more and has included in such contracts all of the terms required by A.R.S. § 32-1158(B), Respondent’s License No. K-67.180099-D shall not be suspended but, instead, Complainant Mark Goodfarb’s Complaint in Case No. 2012-2985 shall be closed. 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, February 6, 2013.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See Respondent’s Exhibit A. [2] See Complainant’s Exhibit 1. [3] See Complainant’s Exhibit 4. [4] See A.R.S. §§ 32-1151 to 32-1169. [5] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19- 119(B)(1); 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] A.R.S. § 32-1154(A)(1) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” [8] 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.” [9] 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.” [10] A.R.S. § 32-1158(B) provides that any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved after December 31, 2007 must be in writing and must include the following minimum terms:

1. The name of the contractor and the contractor’s business address and the license number. 2. The name and mailing address of the owner and the jobsite address or legal description. 3. The date the parties entered into the contract. 4. The estimated date of completion of all work to be performed under the contract. 5. A description of the work to be performed under the contract. 6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes. 7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner. 8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract. 9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar’s telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A. The information in this paragraph must be prominently displayed in the contract in ten point bold type. . . .

[11] 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.”

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