ALJDEC decisions subject to certification as final

2012A-4704-ROC · Registrar of Contractors · 2013-09-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 27, 2013, at 1:00 p.m. APPEARANCES: The Arizona Registrar of Contractors (hereinafter the “Registrar”) was represented by Michael Raine, Esq., Office of the Attorney General. Dreamscapes Lighting and Landscape LLC (hereinafter “Dreamscapes”) failed to appear. Although the start of the hearing was delayed fifteen minute to allow Dreamscapes additional time, Dreamscapes did not appear at the hearing. Dreamscapes did not contact the Office of Administrative Hearings to request that the start of the hearing be further delayed. ADMINISTRATIVE LAW JUDGE: M. Douglas _____________________________________________________________________

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made: FINDINGS OF FACT Dreamscapes is the holder of License No. B-5.262271-R issued by the Registrar on or about March 2, 2010. Dreamscapes is the holder of License No. K-21.218384-D issued by the Registrar on or about April 9, 2006. Dreamscapes contracted with Gregory and Liliann Walker (hereinafter “the Walkers,” “Complainant,” “Complainants,” or “Mr. Walker”) on or about May 21, 2012, to perform landscaping and concrete work and to construct a new swimming pool at the Walkers’ residence located at 4711 S. Banning Court, Gilbert, Arizona for the total sum of $26,200.00. The Walkers were dissatisfied with Dreamscapes’ workmanship and made repeated requests that Dreamscapes correct its unsatisfactory workmanship and properly complete their construction project. When Dreamscapes failed to comply with the Walkers’ repeated requests, the Walkers filed a formal Complaint against Dreamscapes with the Registrar. Pursuant to the filing of the formal Complaint, an assigned Registrar Inspector, Randy Cason (hereinafter “Inspector Cason”), conducted an onsite inspection. Inspector Cason issued a written Corrective Work Order on October 25, 2012, directing Dreamscapes to perform designated corrective work at Complainants’ residence. The Corrective Work Order provided, in pertinent part, as follows: Complaint #1. Unknown water leaks around all (4) sides of the pool in backyard. Most visible in the early a.m. time. Southern side of pool has the largest wet area. Inspected the areas in question, was not able to determine if there is a leak or not.

NOTE: Complainant stated that the Respondent had conduct[ed] 2 different water leak detection test[s] with 3rd party. Test[s] showed no leaks in irrigation system; however 1 test found leaks in the pool’s plumbing system that the Respondent had corrected prior to this inspection.

Complaint #2. Unknown water leaks near south gate area inside backyard. Inspected the area in question, was not able to determine if there is a leak or not.

Complaint #3. Unknown water leak by pool pump. Prior to this job site inspection the Respondent had correct[ed] this complaint item. No Action is required by the Respondent.

Complaint #4. Repair backside of concrete pool wall by water features (3). (Eastern side) The Respondent had opened up back side of the wall looking for possible water leak; however at this time the Respondent has not completed the repairs. The Respondent needs to paint the repaired areas. The Respondent is to correct by appropriate means.

Complaint #5. Repair north side of pool concrete slab as was laid before it needed to be removed to let the water drenched area dry up. To this day area is still wet. Prior to this job site inspection the Respondent had correct[ed] this complaint item. No Action is required by the Respondent.

Complaint #6. Remove concrete slab debris that was removed on 9/12/2012, lying in a pile on north side of the backyard. Prior to this job site inspection the Respondent had correct[ed] this complaint item. No Action is required by the Respondent.

Complaint #7. Refill holes that were dug up around backyard and smooth out gravel in yard. Prior to this job site inspection the Respondent had correct[ed] this complaint item. No Action is required by the Respondent.

Complaint #8. Western side of pool - slab of concrete has cracks and is no longer at level with other concrete. Inspected the area in question, did not see any cracks[;] however, I did find that there is a vertical displacement approx.: inches long with a 5/32 of an inch difference in height between the 2 section[s] of concrete slabs. The Respondent is to correct by appropriate means.

On or about November 13, 2012, the Walkers provided the Registrar with written notice that Dreamscapes had performed no corrective work at their residence.[1] On or about November 16, 2012, the Registrar issued a letter to Dreamscapes informing it that a request for a formal citation against Dreamscapes’ licenses had been filed with the Registrar.[2] On or about March 14, 2013, Dreamscapes’ attorney filed a letter with the Registrar requesting that License No. B-5.262271-R and License No. K- 21.218384-D of Dreamscapes be canceled.[3] On or about April 22, 2013, Dreamscapes’ attorney filed a letter stating that Dreamscapes had filed bankruptcy.[4] On May 16, 2013, the Registrar issued a formal Citation and Complaint charging Dreamscapes with possible violations of A.R.S. § 32-1154(A)(3),[5] namely, A.A.C. R4-9-108,[6] A.R.S. § 32-1154(A)(21),[7] and A.R.S. § 32- 1154(A)(23).[8] Testimony of Gregory A. Walker Mr. Walker testified that he contracted with Dreamscapes to install a 25,000 gallon pool and associated decking in Complainants’ yard for the sum of $26,200.00.[9] Mr. Walker stated that he signed the contract and his wife initialed the contract. Mr. Walker testified that the installation of additional decking was an integral part of the parties’ contract. Mr. Walker testified that the parties entered into a change order for additional decking for the sum of $1,650.00.[10] Mr. Walker that the additional decking was in addition to the decking package that was included in the parties’ contract. Mr. Walker testified that Complainants starting encountering problems with Dreamscapes’ workmanship before the swimming pool and decking were completed. Mr. Walker stated that the water feature leaked. Mr. Walker testified that Dreamscapes would repair some items and not others. Mr. Walker testified that Complainants filed a Complaint against Dreamscapes because Dreamscapes failed to resolve its workmanship problems despite Complainants’ repeated requests that it do so. Mr. Walker testified that he was present for Inspector Cason’s pre-hearing inspection. Mr. Walker stated that Dreamscapes failed to comply with the terms of the Corrective Work Order. Mr. Walker testified that Complainants had not seen or heard from anyone associated with Dreamscapes since the Corrective Work Order was issued. Mr. Walker stated that Dreamscapes’ assertion in Dreamscapes’ written answer to the Complaint that the matter had been resolved was false.[11] Mr. Walker testified that working with Dreamscapes had been a struggle. Mr. Walker stated that “he would not give Dreamscapes any more money.” Mr. Walker’s testimony is found to be credible. Testimony of Inspector Cason Inspector Cason testified that he has been in the construction business for approximately thirty-five years. Inspector Cason stated that he been an Inspector for the Registrar for approximately seven years. Inspector Cason testified that he conducted an onsite inspection at Complainants’ residence and issued a Corrective Work Order on October 25, 2012.[12] Inspector Cason stated that he performed a pre-hearing inspection at Complainants’ residence on August 23, 2013. Inspector Cason testified that he observed that Dreamscapes had failed to comply with the terms of the Corrective Work Order. Inspector Cason testified that Dreamscapes’ workmanship at Complainants’ residence failed to comply with applicable workmanship standards. Inspector Cason stated that the concrete cracking in Complainants’ decking exceeded applicable workmanship standards. Inspector Cason testified that the cracking had increased to beyond ¼ inch. Inspector Cason stated that “no one had been out” to perform any corrective work at Complainants’ residence. Inspector Cason’s testimony is found to be credible. Testimony of Adam L. Stafford Adam L. Stafford (hereinafter “Mr. Stafford”) testified that he was the assistant chief of the legal department for the Registrar. Mr. Stafford stated that Dreamscapes’ K-21.218384-D License was issued by the Registrar on or about April 9, 2006.[13] Mr. Stafford testified that Dreamscapes’ B- 5.262271-R License was issued by the Registrar on or about March 2, 2010.[14] Mr. Stafford testified that the Registrar has received a total of twenty- six complaints against Dreamscapes’ B-5.262271-R License. Mr. Stafford stated that the Registrar had received a total of sixteen complaints against Dreamscapes’ K-21.218384-D License. Mr. Stafford testified that there were six workmanship or abandonment complaints against Dreamscapes’ K- 21.218384-D License. Mr. Stafford testified that there were five workmanship complaints against Dreamscapes’ B-5.262271-R License. Mr. Stafford stated that the Registrar received a cancellation request from Dreamscapes’ attorney for both licenses on or about March 14, 2013. Mr. Stafford testified that the cancellation of the Dreamscapes’ contractor’s licenses did not have any effect on the Registrar’s ability to impose discipline on Dreamscapes’ contractor’s licenses.[15] Mr. Stafford testified that the Registrar was not seeking any financial penalty against Dreamscapes. Mr. Stafford stated that the Registrar was operating in its regulatory function to protect the public from unscrupulous or unqualified contractors. Mr. Stafford testified that should the Registrar suspend or revoke either of Dreamscapes’ contractor’s licenses, the same conduct and circumstances would constitute a violation of the charged provision of A.R.S. § 32- 1154(A)(21), and that both of Dreamscapes contractor’s licenses would be suspended or revoked. Mr. Stafford testified that Dreamscapes had been dissolved as a limited liability company. Mr. Stafford testified that the Registrar had recently imposed a $1,500.00 civil penalty on Dreamscapes’ Qualifying Party, Jonathan Charnock, for advertising without a license in violation of A.R.S. § 32-1165.[16] Mr. Stafford’s testimony is found to be credible. Administrative notice is taken of Dreamscapes’ prior license records as reflected on the Registrar’s public website on September 6, 2013. Such prior license records reflect that License No. K-21.218384-D of Dreamscapes was canceled on March 15, 2013. License No. K-21 218384-D of Dreamscapes had previously been suspended for lack of bond on February 21, 2013. Such prior license records reflect that License No. B-5.262271-R of Dreamscapes was canceled on March 15, 2013. License No. B-5.262271-R of Dreamscapes had previously been suspended for lack of bond on January 13, 2013. License No. B-5.262271-R of Dreamscapes had been suspended for lack of bond from June 21, 2012, through June 26, 2012. License No. B-5.262271-R of Dreamscapes had been suspended for lack of bond from February 13, 2012, through February 15, 2012. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these matters is by a preponderance of the evidence. See A.A.C. R2-19-119. 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). 3. Dreamscapes “opened-up” the back side of Complainants’ wall looking for possible water leaks. Dreamscapes failed to paint the concrete corrections that Dreamscapes made to the wall. There is a vertical displacement on the west wall that exceeds ¼ inch. The vertical displacement is continuing to increase. Dreamscapes performed no corrective work on the vertical displacement in the concrete wall. The vertical displacement in the west wall that exceeds ¼ inch fails to comply with applicable workmanship and industry standards. Dreamscapes performed no corrective work at Complainants’ residence as required by the Corrective Work Order. This Tribunal concludes that Dreamscapes violated the charged provisions of A.R.S. § 32-1154(A)(3), namely, A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(23). This Tribunal concludes that such conduct and circumstances constitutes a violation of the charged provision of A.R.S. § 32-1154(A)(21). RECOMMENDed order In view of the foregoing, it is recommended that License No. B- 5.262271-R and License No. K-21.218384-D of Dreamscapes shall be revoked of the effective date of this Order. In the event of certification of this 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 the certification Done this day, September 11, 2013.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] See Exhibit No. 7 (11/13/12 Letter). [2] See Exhibit No. 8 (11/16/12 Letter). [3] See Exhibit No. 9 (3/14/13 Letter) [4] See Exhibit No. 10 (4/22/13 Letter). [5] A.R.S. § 32-1154(A)(3) includes among the grounds for disciplinary action against a contractor’s license, violation of any rule adopted by the registrar. [6] A.A.C. R4-9-108 provides, in pertinent part, as follows: A. A contractor shall perform all work in a professional and workmanlike manner. B. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. C. All work performed by a contractor in a county, city, or town that has not adopted building codes or where any adopted building codes do not contain specific provisions applicable to that aspect of construction work shall be performed in accordance with professional industry standards.

[7] A.R.S. § 32-1154(A)(21) includes among the grounds for disciplinary action against a contractor’s license, having a person named on the license who is named on any other license in this state or in another state which is under suspension or revocation unless the prior revocation was based solely on a violation of this paragraph. [8] A.R.S. § 32-1154(A)(23) includes among the grounds for disciplinary action against a contractor’s license, failure 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. The written directive shall set forth the time within which the contractor is to complete the remedial action. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive. A license shall not be revoked or suspended nor shall any other penalty be imposed for a violation of this paragraph until after a hearing has been held. [9] See Exhibit No. 2 (6/8/12 Contract). [10] See Exhibit No. 2 (7/2/12 Change Order). [11] See Exhibit No. 12 (5/29/13 Email). [12] See Exhibit No. 5 (10/25/12 Corrective Work Order). [13] See Exhibit No. 1 (License No. K.21.218384-D). [14] See Exhibit No. 1 (License No. B-5.262271-R). [15] A.R.S. 32-1154(C) provides as follows:

The expiration, cancellation, suspension or revocation of a license by operation of law or by decision and order of the registrar or a court of law or the voluntary surrender of a license by a licensee shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such licensee, or to render a decision suspending or revoking such a license, or denying the renewal or right of renewal of such license.. [16] A.R.S. § 32-1165 provides as follows:

Except as authorized by section 32-1121, subsection A, paragraph 14, subdivision (c), it is a class 1 misdemeanor for any person to advertise that he is able to perform any service or contract for compensation subject to regulation by the registrar under the terms of this chapter unless a license under the terms of this chapter is first obtained regardless of whether his operations as a contractor are otherwise exempt.

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