ALJDEC decisions subject to certification as final

2012A-4466-ROC · Registrar of Contractors · 2013-10-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 9, 2013 APPEARANCES: Complainants Humberto Urrabazo and Lupe Urrabazo appeared on their own behalf. Respondent did not appear. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ FINDINGS OF FACT Background and Procedure The Arizona Registrar of Contractors (“the Registrar”) issued License No. K- 61.270850-D to Landmark Remodelers Inc dba Landmark Insurance Restoration (“Respondent”). On or about September 12, 2012, Humberto Urrabazo and Lupe Urrabazo (“Complainants”) filed a Complaint with the Registrar regarding a new roof installation that resulted in leaking and damage to the ceiling. The Registrar’s assigned inspector, Beau Cruz, performed a jobsite inspection. On October 2, 2012, Inspector Cruz issued a Corrective Work Order (“CWO”) finding that a 9 foot by 3 foot section of the ceiling in the hallway had been water damaged by rain and needed to be repaired by appropriate means. Inspector Cruz also noted roof debris in the attic section and excessive water damaged and matted cellulose insulation directly above the bathroom and hall areas in the vicinity below the condensing unit. The CWO noted that Respondent’s license had been suspended for lack on bond on January 5, 2012, and Respondent could not do or subcontract the corrective work that was ordered until the suspension was lifted. After Complainant requested a hearing, the Registrar issued a Citation and Complaint against Respondent charging possible violations of 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) and A.R.S. § 32-1158; A.R.S. § 32-1154(A)(15); A.R.S. § 32- 1154(A)(20); and A.R.S. § 32-1154(A)(23). Respondent filed a timely written answer to the Citation and Complaint denying any violations. The Registrar referred the matter to the Office of Administrative Hearings, an independent State agency, for an evidentiary hearing. The Registrar issued a Notice of Hearing, setting a hearing at 8:00 a.m. on October 9, 2013. The Registrar mailed copies of the Notice of Hearing to Respondent at its address of record. The Notice of Hearing informed the parties that “[f]ailure to attend the scheduled hearing is likely to result in an adverse ruling against you.” At a pre-hearing inspection, Inspector Cruz determined Respondent had taken no action on the CWO. A hearing was held on October 9, 2013. Inspector Cruz testified. Complainants submitted one exhibit and testified on their own behalf. Respondent did not request to appear telephonically and did not request that the hearing be continued. Although the start of the hearing was delayed 20 minutes, Respondent did not appear through an authorized member, employee, or attorney. Consequently, Respondent did not present any evidence to defend its license Hearing Evidence On or about January 19, 2011, Respondent provided a “Contract to Purchase” to Complainants for the replacement of their roof. The contract indicated the company name was “Landmark Insurance Restoration” in the heading and did not include Respondent’s license number. A notation at the bottom of the contract indicated the buyer should make all checks payable to “LANDMARK REMODELERS, INC.” The contract did not include the estimated date of completion of all work to be performed under the contract or an advisement that the property owner had the right to file a written complaint with the Registrar for an alleged violation of A.R.S. § 32- 1154(A) including the Registrar’s telephone number and website address. Complainants signed to accept the contract on February 5, 2011. Respondent completed the job on March 4, 2011. Complainants realized the air conditioning unit was not properly sealed, which resulted in rain seeping into the attic and damaging the sheetrock ceiling in the hallway. Complainants attempted to contact Respondent in August and September 2012, without a response. After Complainants filed their complaint and before the inspection, Respondent properly sealed the air conditioning unit to prevent any further leaking. Respondent proposed to repair the ceiling in the hallway by laying a new layer of drywall over the damaged area. Respondent did not specify whether it intended to put the new layer only over the 9 foot by 3 foot section of the ceiling that had been damaged or whether it intended to put a new layer over the entire hallway. Respondent did not make any attempts to comply with the CWO. Inspector Cruz testified that placing a new layer of drywall over the affected area would be an appropriate method of correcting the work if the layer was placed over the entire hallway to ensure an even finished appearance. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website. On October 29, 2013, such prior License record reflects that Respondent’s license was suspended from January 5, 2012, through October 25, 2012, due to lack of bond. Further, Respondent’s license was suspended due to non-renewal on March 1, 2013 and two complaints were pending against the license. CONCLUSIONS OF LAW The Registrar has jurisdiction to determine whether Respondent violated the charged subsections of A.R.S. § 32-1154(A). A.R.S. §§ 32-1151 to 32-1169. Respondent’s administratively suspended license does not deprive Complainants of their right to prosecute their complaint or prevent the Registrar from determining the merits of the complaint. See A.R.S. § 32- 1154(D). Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. 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, 838 (1952). Respondent bears the burden to establish affirmative defenses by the same evidentiary standard. See A.A.C. R2-19-119(B)(2). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). The undisputed evidence at hearing established that Respondent failed to properly seal the air conditioning unit after installing a new roof which lead to leaking water and damage in the attic and ceiling. Therefore, Complainants established that Respondent’s work was unprofessional and not workmanlike, in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9- 108.[1] The undisputed evidence at hearing established that Respondent’s contract failed to include Respondent’s license number issued by the Registrar. Therefore Complainants established that Respondent failed to comply with the statute in violation of A.R.S. § 32-1154(A)(13), namely A.R.S. § 32- 1124(B).[2] The undisputed evidence at hearing established that Respondent’s contract failed to include the estimated date of completion and an advisement of the property owners’ right to file a written complaint with the Registrar. Therefore, Complainants established that Respondent’s contract failed to include the minimum elements of a contract in violation of A.R.S. § 32- 1154(A)(13), namely A.R.S. § 32-1158(B).[3] The undisputed evidence at hearing established that Respondent’s contract identified the company as “Landmark Insurance Restoration” but did include a reference to Landmark Remodelers, Inc. Further, Respondent’s prior License record could be found on the Registrar’s website by searching for Landmark Insurance Restoration. Therefore, Complainants failed to establish that Respondent violated A.R.S. § 32-1154(A)(15).[4] The undisputed evidence at hearing established that Respondent’s license was suspended at the time it entered into the contract with Complainants. A.R.S. § 32-1122(E) provides as a qualification for a license that a person shall not “act as a contractor between the filing of the application and actual issuance of the license.” Further, A.R.S. § 32-1122(D) provides as a qualification for a license that a person “shall be of good character and reputation. Lack of good character and reputation may be established by showing that a person has engaged in contracting without a license.” Therefore, Complainants established that Respondent violated A.R.S. § 32- 1154(A)(20).[5] The undisputed evidence at hearing established that Respondent did not make any attempt to comply with the CWO. Therefore, Complainant established that Respondent failed to take appropriate corrective action within a reasonable period of time after receiving a written directive from the Registrar in violation of A.R.S. § 32-1154(A)(23).[6] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent Landmark Remodelers Inc DBA: Landmark Insurance Restoration’s License No. K-61.270850-D for a period of 30 days. It is further recommended that in addition to the suspension, Respondent’s License shall be placed on disciplinary probation for a period of 180 days commencing on the expiration of the 30-day suspension. It is further recommended that Respondent pay $500.00 as a civil penalty to the Registrar pursuant to A.R.S. § 32-1154(D). 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, October 29, 2013.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] 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.” [2] 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 “[t]he license number appearing on any licenses held by the licensee shall be preceded by the acronym ‘ROC’ and . . . shall be placed on all written bids submitted by the licensee.” [3] A.R.S. § 32-1158(B) requires that:

any contract in an amount of more than one thousand dollars and less than one hundred fifty thousand dollars entered into between a contractor and the owner of a property to be improved shall contain in writing at least the following information: . . . . 4. The estimated date of completion of all work to be performed 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 at least ten point bold type, and the contract shall be signed by the property owner and the contractor or the contractor's designated representative.

[4] A.R.S. § 32-1154(A)(15) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]cting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth on the license.” [5] A.R.S. § 32-1154(A)(20) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[s]ubsequent discovery of facts that if known at the time of issuance of a license or the renewal of a license would have been grounds to deny the issuance or renewal of a license.” [6] 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.”

-----------------------

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