ALJDEC decisions subject to certification as final

2012A-4890-ROC · Registrar of Contractors · 2013-06-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 30, 2013, at 8:00 a.m. APPEARANCES: David Parri (hereinafter “Complainant”) appeared by and through his attorney, Eric. R. Hawkins, Esq., Durazzo, Eckel & Hawkins P.C. R L Ventures LLC (hereinafter “RL Ventures”) appeared by and through its attorney, Craig L. Cline, Esq., Gabroy, Rollman & Bosse P.C. 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 RL Ventures is the holder of License No. B.264742-R issued by the Registrar of Contractors. This is a residential matter where RL Ventures agreed to perform an extensive remodeling of Complainant’s existing residence at 6636 E. River Heights Place, Tucson, Arizona 85750, for the sum of $500,000.00. Complainant was dissatisfied with RL Venture’s workmanship and with its failure to complete its remodeling work in a timely manner. RL Ventures stopped work on the remodeling project and informed Complainant that it needed more money to continue working. When the parties were unable to resolve their differences Complainant filed a formal Complaint against RL Ventures with the Registrar of Contractors. Pursuant to the filing of the formal Complaint, an assigned Registrar Inspector, Frank Grochocki (hereinafter “Inspector Grochocki”), conducted an onsite inspection. Inspector Grochocki issued a written Corrective Work Order on October 26, 2012, directing RL Ventures to perform designated corrective work on Complainant’s residence. The Corrective Work Order provided, in relevant part, as follows: 1) Complaint of: “demolition not complete”, jobsite found open trenches, exposed plumbing, contractor to complete and correct by appropriate means.

2) Complaint of: “concrete slab defect[ive] and not complete”, jobsite found areas of interior slab uneven, not filled properly, contractor to correct and complete by appropriate means.

3) Complaint of: “framing defect throughout house”, jobsite found majority of framing covered with drywall and stucco, jobsite found posts at front and rear patios not per plan or building standards and rough sawn framing rafters at front entry not within standards, contractor to correct and pass inspections by local building authority.

4) Complaint of: “plumbing defect[ive] and not complete”, jobsite found plumbing covered unable to determine defect, found incomplete, contractor to complete as per plans and pass all inspections from local building authority.

5) Complaint of: “roofing not complete”, jobsite found roofing incomplete, contractor to complete as per plans by appropriate means.

6) Complaint of: “stucco and drywall defect[ive] not complete”, jobsite found areas [of] stucco with no weep screed and excessive cracking and areas of pop outs uneven, contractor to correct, complete, and pass inspection by local building authority.

7) Complaint of: “tiles defect[ive] and not complete”, jobsite found tile in 3 baths with lippage not within standards, deco tile buried under drywall at ceiling line, and tile incomplete, contractor to correct and complete by appropriate means.

8) Complaint of: “doors and windows damaged and not complete”, jobsite found dented window, front entry door with uneven reveal, windows and doors incomplete, contractor to correct and complete by appropriate means.

9) Complaint of: “front entry porch defect[ive] not safe”, jobsite found front entry pillars not lined up, support posts not within standards, contractor to correct and pass inspection by local building authority.

10) Complaint of: “painting, cabinet, garage doors, electric, mechanical not done”, jobsite found items not complete, painting material not per specs, contractor to complete as per plans and specs, and pass inspections with local building authority.

11) Complaint of: “front south porch defect not safe, not built to specification”, jobsite found porch not to specs, porch support posts not within industry standards, contractor to correct as per plans and specs and pass inspection by local building authority.

12) Complaint of: “septic tank, court yard, pool, Jacuzzi, granite counter tops not done”, jobsite found items not complete, contractor to complete as per plans and specs and pass inspection by local building authority.

13) Complaint of: “appliances, outside lights, mirrors, bath fixtures, shelving not done”, jobsite found items not complete contractor to complete and pass inspection by local building authority.

14) Complaint of: “tiles, carpet, security system, cantera columns not done”, jobsite found items not done, contractor to complete as per plans by appropriate means.

15) Complaint of: “east side garage needs to be 22’ -6”, jobsite found garage width 21’-1”, not per plans, contractor to correct and pass inspection by local building authority.

16) Complaint of: “outside overhang defect and not to specification”, jobsite found facia boards warped, uneven, not per plans, contractor to correct by appropriate means.

17) Complaint of: “no insurance, using unlicensed subcontractors, not paying subcontractors”, contractor to provide proof of insurance as per contract, name and license of all subcontractors used, and pay all subcontractors as per contract. If unlicensed contractors found, contractor to hire licensed contractors to inspect, correct all work done by unlicensed contractors, and complete project with licensed contractors.

18) Complaint of: “water fountain, BBQ install, landscaping, new planters, concrete pavers not done”, jobsite found items incomplete, contractor to complete by appropriate means.

Added at jobsite:

19) Complaint of: “side porch not built to plans”, jobsite found side porch not built per plans, contractor to correct and pass inspection.

Inspector Grochocki testified that he conducted a pre-hearing inspection on May 28, 2013, to determine whether RL Ventures complied with the terms of the Corrective Work Order. Inspector Grochocki stated that he inspected each item listed on the Corrective Work Order. Inspector Grochocki testified that very little corrective work had been performed and that RL Ventures was not in compliance with the terms of the Corrective Work Order. Inspector Grochocki testified that he had no knowledge of any denial of access. Inspector Grochocki stated that there was still an open trench leading to the septic system that needs to be filled. Inspector Grochocki testified that some corrective work had been performed on the concrete slab. Inspector Grochocki stated that the concrete slab is still uneven and that further corrective action is required. Inspector Grochocki testified that the majority of the framing on the residence had been covered with drywall or stucco. Inspector Grochocki stated that he visually observed that the posts for the front and rear patios did not comply with plans and specifications. Inspector Grochocki testified that the posts for the front and rear patios did not comply with applicable workmanship standards. Inspector Grochocki stated that the rough sawn rafters at the front entry did not comply with applicable workmanship standards. Inspector Grochocki testified that he found no workmanship defects with the plumbing work that had been completed in the residence. Inspector Grochocki stated that all of the plumbing had not been completed as required by the Corrective Work Order. Inspector Grochocki testified that the roofing work on the residence was not complete. Inspector Grochocki stated that RL Ventures would be expected to comply with the terms of the parties’ written contract. Inspector Grochocki testified that he saw no evidence that a Change Order had been issued for the roof. Inspector Grochocki testified that one exterior stucco wall did not have a code required weep screed. Inspector Grochocki stated that the front exterior wall had excessive stucco cracking. Inspector Grochocki testified that several “pop-outs” on the exterior walls required corrective action. Inspector Grochocki testified that the tile in the residence had excessive “lippage” and required correction. Inspector Grochocki stated that portions of the deco tile were “buried” under drywall and required correction. Inspector Grochocki testified that the front entry door had an uneven reveal and required correction. Inspector Grochocki stated that one window had a dent in the interior of the window and required correction. Inspector Grochocki testified that the window and door installations for the residence were still incomplete. Inspector Grochocki stated that the dented window was probably a manufacturer’s defect. Inspector Grochocki testified that the posts for the front entry porch did not comply with applicable plans and specifications. Inspector Grochocki stated that the construction of the front entry posts did not comply with workmanship standards. Inspector Grochocki testified that RL Ventures had utilized Home Depot paint instead of Dunn Edwards paint on the residence. Inspector Grochocki stated that the use of Home Depot paint did not comply with plans and specifications. Inspector Grochocki testified that the front-south porch posts did not comply with plans and specifications. Inspector Grochocki stated that the front-south porch posts also did not comply with applicable workmanship standards. Inspector Grochocki testified that the septic tank, courtyard, swimming pool, Jacuzzi, and granite countertops had not been completed. Inspector Grochocki testified that the installation of appliances, outside lights, mirrors, bath fixtures, shelving, carpet, security system, and the cantera columns had not been completed. Inspector Grochocki testified that the construction of the east-side garage failed to comply with applicable plans and specifications. Inspector Grochocki stated that the garage was too narrow. Inspector Grochocki testified that there was no change order for the construction of the garage presented to him and that corrective action was required. Inspector Grochocki testified that the outside over-hangs failed to comply with plans and specifications and applicable workmanship standards. Inspector Grochocki stated that the problems with the over-hangs were not structural but still required proper correction. Inspector Grochocki testified that he had seen no proof of insurance by RL Ventures. Inspector Grochocki stated that he had not seen a list of subcontractors as required by the Corrective Work Order. Inspector Grochocki testified that if unlicensed contractors were utilized on the construction project, RL Ventures would be required to have the work that was performed by the unlicensed contractors to be inspected and if necessary, corrected by properly licensed contractors. Inspector Grochocki testified that the construction of the “side-porch” was not in accordance with plans and specifications. Inspector Grochocki stated that the side-porch required proper correction. Inspector Grochocki’s testimony is found to be credible. Complainant testified that his first contact with RL Ventures was through Ahmad N. Zarifi (hereinafter “Mr. Zarifi”).[1] Complainant stated that Mr. Zarifi represented himself as being a partner in RL Ventures. Complainant stated that the remodeling project essentially was the construction of an entirely new residence utilizing a portion of the existing foundation and framing of the original residence. Complainant testified that a nearly complete demolition was part of the original agreement. Complainant stated that Mr. Zarifi was responsible for the design and construction of the new residence. Complainant testified that Dunn Edwards paint was the specified brand of paint for the construction project. Complainant stated that RL Ventures utilized Home Depot paint instead of the specified Dunn Edwards paint. Complainant testified that he did not agree to the use of Home Depot paint for the construction project. Complainant testified that the garage was not constructed in accordance with plans and specifications. Complainant stated that the garage was too small. Complainant testified that he did not agree to a change in the size of the garage. Complainant testified that the remodeling project was to be completed within eight months of the issuance of the construction permit. Complainant stated that work started on the construction project sometime during November 2011. Complainant testified that he filed a Complaint against RL Ventures with the Registrar of Contractors in October 2012. Complainant stated that his residence was still not complete. Complainant testified that whenever he notified RL Ventures of a concern regarding workmanship, he would be assured “not to worry, we will take care of it.” Complainant stated that despite its repeated assurances, RL Ventures failed to resolve the workmanship issues. Complainant testified that he had given RL Ventures access to his residence to perform the corrective action necessary to comply with the terms of the Corrective Work Order. Complainant testified that he was dissatisfied with the original roofing subcontractor that RL Ventures wanted to use on the construction project. Complainant stated that RL Ventures agreed to utilize a different roofing subcontractor selected by Complainant. Complainant testified that the new roofing subcontractor specified that Complainant would have to guarantee payment for the roofing project. Complainant testified that RL Ventures agreed to the use of the new roofing subcontractor. Complainant testified that RL Ventures performed no corrective work on the exterior stucco of his residence. Complainant stated that the tile in the residence is not complete and has not been corrected. Complainant testified that RL Ventures failed to comply with plans and specifications and failed to perform its work in accordance with applicable workmanship standards. Complainant stated that RL Ventures failed to comply with the terms of the Corrective Work Order. Complainant testified that RL Ventures informed him that it would not return to construction project to perform construction work unless Complainant paid it additional money. Complainant opined that the construction project was not salvageable and that the residence should be torn down and reconstructed. Complainant testified that RL Ventures informed him that it did not have enough money to complete the construction project despite the payments that had been made by Complainant. Complainant stated that Mr. Zarifi informed him that some of the funds paid by Complainant to RL Ventures were used by Mr. Zarifi for his personal expenses. Complainant testified that Mr. Zarifi was not named in the parties’ written construction agreement. Complainant stated that there was no requirement in the construction agreement for RL Ventures’ Qualifying Party, Robert Barry Lee (hereinafter “Mr. Lee”), to be personally responsible for the actions of RL Ventures. Complainant acknowledged that he issued an email to Mr. Zarifi’s son, Walid Zarifi, on November 7, 2012.[2] Complainant testified that he requested that Mr. Zarifi and Mr. Lee agree to be personally liable for the construction project and agree to pay $1,000.00 per day as a penalty if the construction project was not completed by February 8, 2013. Complainant testified that he issued the email at the suggestion of Mr. Zarifi’s son. Complainant’s testimony is found to be credible. Richard Lawrence Kaiser P.E. (hereinafter “Mr. Kaiser”) testified that he is a structural engineer and the president of Kaiser Structural, Inc. Mr. Kaiser stated that he performed an onsite inspection at Complainant’s residence and prepared a written report.[3] Mr. Kaiser testified that the actual construction work performed by RL Ventures was substantially different from the approved plans and specifications. Mr. Kaiser stated that there was no documentation showing the changes to approved plans and specifications. Mr. Kaiser stated that he was not aware of any evidence that the local building authority had approved the numerous changes that had been made by RL Ventures to the plans and specifications. Mr. Kaiser testified that RL Ventures had modified the existing trusses to accommodate the new construction work performed on the residence. Mr. Kaiser stated that there were no documentation or engineering calculations for the use of the modified trusses. Mr. Kaiser testified that modifications to the trusses should have been approved by the local building authority before the modifications were made. Mr. Kaiser testified that RL Ventures had deviated from plans and specifications by utilizing previously used wood throughout the framing of the residence. Mr. Kaiser stated that RL Ventures deleted sheer-walls that were shown on the approved plans and specifications. Mr. Kaiser testified that RL Ventures replaced the sheer-walls with windows. Mr. Kaiser stated that the deletion of the sheer-walls provided “an easy mechanism for collapse.” Mr. Kaiser testified that the framing of the residence, as constructed by RL Ventures, violated applicable code requirements. Mr. Kaiser stated that the framing work performed by RL Ventures was inadequate. Mr. Kaiser testified that the residence was unsafe and uninhabitable as constructed. Mr. Kaiser opined that the proper repair for the residence would be to tear it down and reconstruct it. Mr. Kaiser’s testimony is found to be credible. Steven Lee Bauer (hereinafter “Mr. Bauer”) testified that he is the Qualifying Party for S L B Construction Inc.[4] Mr. Bauer stated that he had performed five or six onsite inspections at Complainant’s residence. Mr. Bauer testified that he “opened-up” dry-wall in seven or eight different areas in the residence to inspect the framing. Mr. Bauer stated that RL Ventures had utilized staples to connect dimensional lumber in the framing of the residence. Mr. Bauer testified that the use of staples to connect dimensional lumber was not in accordance with applicable workmanship standards. Mr. Bauer testified that he observed trusses that had been cut by RL Ventures. Mr. Bauer stated that trusses should not be cut without approval from a structural engineer. Mr. Bauer testified that he also inspected the joists and beams in the residence. Mr. Bauer stated that RL Ventures had used dimensional lumber in place of the manufactured joists that were specified in the approved plans and specifications. Mr. Bauer testified that he observed undersized beams that failed to comply with plans and specifications. Mr. Bauer testified that he was concerned about the stability and safety of the residence as constructed. Mr. Bauer stated that the residence possibly could be repaired. Mr. Bauer testified that he believed that due to safety issues, the best method of repair would be to tear the residence down and start over. Mr. Bauer’s testimony is found to be credible. Mr. Lee testified that this construction project was his second remodeling project. Mr. Lee acknowledged that mistakes had been made on the construction project. Mr. Lee testified that he had numerous conversations with Complainant regarding money that RL Ventures claimed was owed on the construction project. Mr. Lee stated that RL Ventures stopped construction work and left the construction project due to the money dispute. Mr. Lee testified that he hand-delivered a written letter to Complainant stating the reasons for stopping work on the day RL Ventures left the construction project. Mr. Lee testified that after the Corrective Work Order was issued, RL Ventures returned to Complainant’s residence and performed corrective work as directed by the Corrective Work Order. Mr. Lee stated that RL Ventures worked on the construction project until Complainant requested that Mr. Lee agree to be personally liable and to pay $1,000.00 per day in damages. Mr. Lee testified that due to Complainant’s request to modify the terms of the construction agreement, RL Ventures stopped performing corrective work on the construction project. Mr. Lee testified that the trench had not been filled because there had been a recent connection to the sewer line. Mr. Lee stated that the trench could now be filled at any time. Mr. Lee testified that RL Ventures had performed some corrective work on the concrete. Mr. Lee stated that RL Ventures was willing to perform further corrective work on the concrete if it was directed to do so. Mr. Lee testified that RL Ventures was willing to complete the construction project if the Complainant paid RL Ventures in accordance with the terms of the parties’ construction agreement. Mr. Lee testified that RL Ventures was willing to install the missing weep screed. Mr. Lee stated that the exterior stucco on the residence is a brown coat that was installed to protect the lathing. Mr. Lee testified that the cracking would be corrected when two additional coats of exterior stucco were applied to the residence. Mr. Lee testified that there is lippage in some of the floor tile in the residence and that some deco-tile had been covered with sheetrock. Mr. Lee stated that these were “punch-list” type of items that would normally be corrected when the project was completed. Mr. Lee testified that the dented window was a manufacturer’s defect. Mr. Lee stated that the manufacturer would replace the window. .Mr. Lee stated that the uneven reveal in the front door was a “punch-list” type of item that would normally be addressed when the construction project was completed. Mr. Lee testified that the support posts for the front porch would be replaced by RL Ventures once Complainants selected the type of columns that he wanted installed in place of the support posts. Mr. Lee stated that the front porch support posts were temporary. Mr. Lee testified that the septic tank, court yard, pool, Jacuzzi, and granite counter tops, installation of appliances, outside lights, bath fixtures, and shelving are not done because they have not been paid for. Mr. Lee stated that RL Ventures was willing to complete the construction project in accordance with the terms of the parties’ construction agreement. Mr. Lee acknowledged that the size of the garage failed to comply with specifications. Mr. Lee testified that as compensation for the slightly smaller garage, RL Ventures expanded the size of Complainant’s master bedroom by approximately seventy-six square feet. Mr. Lee stated that expanding the master bedroom to compensate for the slightly smaller garage was a “win” for Complainant and a “win” for RL Ventures. Mr. Lee testified that Complainant was present at the construction site and was aware of the size of the garage and expansion of the master bedroom. Mr. Lee testified that there was some warping plywood in the framing in the overhangs. Mr. Lee stated that RL Ventures was willing to correct the construction of the overhangs. Mr. Lee stated that the overhangs were not on the approved plans and that RL Ventures constructed the overhangs to try and keep Complainant happy. Mr. Lee acknowledged that RL Ventures did not have general liability insurance while it was working at the construction project. Mr. Lee testified that Complainant had general liability insurance and that “everything was covered.” Mr. Lee acknowledged that RL Ventures should have had general liability insurance. Mr. Lee testified that RL Ventures would obtain general liability insurance if given the opportunity to perform corrective work on Complainant’s residence. Mr. Lee acknowledged that RL Ventures utilized an unlicensed framing contractor and an unlicensed drywall contractor on the construction project.[5] Mr. Lee stated that he believed that the problems with the drywall had been corrected by RL Ventures. Mr. Lee testified that Mr. Zarifi had submitted numerous documents to the local building authority for the approval of deviations in the construction of the residence. Mr. Lee stated some of the submittals for deviations were necessitated by Complainant’s request for changes in the construction of the residence. Mr. Lee testified that all of the framing had been inspected and approved by the local building authority. Mr. Lee testified that Complainant constantly caused delays in the construction project by failing to decide in a timely manner the type of product to be installed. Mr. Lee stated that the window selection process alone caused a delay of a month during the construction project. Mr. Lee testified that Complainant’s dog caused problems and delays during the construction project. Mr. Lee stated that Complainant’s dog bit one of RL Ventures’ employees. Mr. Lee testified that he knew that Complainant wanted Cantera columns to be installed in the residence. Mr. Lee stated that Complainant had failed to give RL Ventures written notice of the selection. Mr. Lee acknowledged that RL Ventures owed money to the subcontractors utilized on the construction project. Mr. Lee stated that he did not know the exact amount of money that was owed to the subcontractors. Mr. Lee testified that he was not aware of any liens filed against Complainant’s property by RL Ventures’ subcontractors. Mr. Lee stated that the insulation subcontractor had not been paid because RL Ventures had not been paid by Complainant for the installation of the insulation. Mr. Lee testified that the written Answer filed by RL Ventures that he signed on its behalf specifically stated that all of the subcontractors utilized by RL Ventures on Complainant’s construction project were licensed contractors. Mr. Lee acknowledged that two unlicensed contractors were utilized by RL Ventures for the construction project and that the statement in the Answer was incorrect. Mr. Lee acknowledged that RL Ventures painted the house with Home Depot paint rather than Dunn Edwards paint. Mr. Lee testified that the Dunn Edwards was the specified paint. Mr. Lee stated that there were no change orders for the construction project. Mr. Lee testified that Mr. Zarifi submitted all applications for approval for deviations from plans and specifications to the local building authority. Mr. Lee stated that he did not know how many applications for approval for deviations were submitted. Mr. Lee testified that Mr. Zarifi was not a partner, officer or employee of RL Ventures. Mr. Lee stated that Mr. Zarifi had no role with RL Ventures. Mr. Lee testified that Mr. Zarifi was an engineer for the construction project. Mr. Lee stated that Mr. Zarifi was his friend and acted as his mentor. Mr. Lee stated that “he would take care of [Mr. Zarifi] at the end of the job.” Mr. Lee testified that he was responsible for choosing RL Ventures’ subcontractors for the construction project. During his testimony Mr. Lee produced a list of subcontractors that RL Ventures had used on the construction project.[6] Mr. Lee stated that he was not aware that the electrical subcontractor’s license was suspended during the construction project.[7] Mr. Lee testified that did not recall checking to see if the subcontractors were properly licensed. Mr. Lee denied that Complainant’s proposal to amend the contract to impose personal liability on Mr. Lee was the result of a discussion between Mr. Zarifi, Mr. Zarifi’s son, and the Complainant. Mr. Lee testified that he had mistakenly believed that RL Ventures could use unlicensed contractors so long as they were not performing a protected scope of construction work. Mr. Lee stated that he believed that unlicensed contractors could perform work as though they were his employees. Mr. Lee testified that he now knows that his belief was incorrect. Mr. Lee acknowledged that unlicensed subcontractors performed the framing and drywall work on the construction project. Mr. Lee stated that RL Ventures was willing to hire licensed drywall and framing subcontractors to inspect the drywall and framing work performed by the unlicensed contractors. Mr. Lee testified that RL Ventures would pay the licensed drywall and framing contractors to correct any work that was found to be unacceptable. Administrative notice is taken of RL Ventures’ prior license record as reflected on the Registrar of Contractors’ public website on June 12, 2013. Such prior license record reflects that License No. B.264742-R of RL Ventures is current. CONCLUSIONS OF LAW 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. 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). RL Ventures informed Complainant that it did not have enough money to complete the construction project despite the payments that had been made by Complainant. RL Ventures informed Complainant that RL Ventures was out of money because some of the money that Complainant had paid RL Ventures for the construction project had been used for Mr. Zarifi’s personal expenses. This Tribunal concludes that RL Ventures violated the charged provision of A.R.S. § 32-1154(A)(1).[8] RL Ventures failed to install a code-required weep screed on one of the exterior walls of the residence. The posts installed by RL Ventures for the porches of the residence failed to comply with applicable plans and specifications and applicable workmanship standards. RL Ventures utilized Home Depot paint instead of the Dunn Edwards paint specified in the parties’ construction agreement. The garage constructed by RL Ventures deviated from plans and specifications. RL Ventures utilized previously used wood throughout the construction project in violation of applicable workmanship standards. RL Ventures used an unlicensed framing contractor to cut and modify trusses without engineering calculations and approval from the local building authority. RL Ventures deleted sheer walls that were specified in approved plans and specifications. The cutting of the trusses and the elimination of specified sheer walls created a health and safety danger in the residence. This Tribunal concludes that RL Ventures violated the charged provisions of A.R.S. § 32-1154(A)(2),[9] and A.R.S. § 32- 1154(A)(3),[10] namely, A.A.C. R4-9-108.[11] RL Ventures failed to complete the corrective action required by the Corrective Work Order issued in this matter. This Tribunal concludes that RL Ventures violated the charged provision of A.R.S. § 32-1154(A)(23).[12] RECOMMENDed order In view of the foregoing, it is recommended that License No. B.264742- R of RL Ventures shall be revoked. It is further recommended in addition to the above-provided penalties, if any, that RL Ventures pay the sum of $500.00 to the Registrar of Contractors by way of a civil penalty pursuant to A.R.S. § 32-1154(D). The failure by RL Ventures to pay the entire amount of the aforesaid civil penalty on or before 30 days following the effective date of the Order entered in this matter shall result in the automatic revocation of RL Venture’s contractor’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with RL Ventures, as defined in A.R.S. § 32-1101(A)(5), unless payment of any outstanding prior civil penalty is tendered. 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, June 14, 2013.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] Administrative notice is taken of the Registrar of Contractors’ public website on June 8, 2013. Ahmad N. Zarifi is shown as the Qualifying Party for License No. B-5.190450-R.of Southwest Foothills Homes Inc. License No. B-5.190450-R of Southwest Foothills Homes Inc. expired on January 1, 2009. [2] See Exhibit No. R-1 (11/7/12 email from Complainant to Walid Zarifi). [3] See Exhibit No. C-4 (5/29/13 Site Visit Report). [4] Administrative notice is taken of S L B Construction Inc.’s prior license record as reflected on the Registrar of Contractors’ public website on June 8, 2013. Such prior license record reflects that License No. B.106427-R of S L B Construction Inc. is current [5] See Exhibit No. R-4 (Handwritten list of subcontractors). The unlicensed framing contractor was identified as “BKS Framing, Bruce Simmons.” The unlicensed drywall subcontractor was identified as Cesar/RL Ventures.” See Exhibit No. R-4 (Handwritten list of subcontractors). [6] See Exhibit R-4 (Handwritten list subcontractors). [7] Administrative notice is taken of the prior license record of Mike’s Electric as reflected on the Registrar of Contractors’ public website on June 8, 2013. Such prior license record reflects that License No. C- 11.264842-R of Mike’s Electric was suspended by the Registrar of Contractors for non-renewal from 6/1/12 through 5/6/13. [8] A.R.S. § 32-1154(A)(1) includes among the grounds for disciplinary action against a contractor’s license, abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal. [9] A.R.S. § 32-1154(A)(2) includes among the grounds for disciplinary action against a contractor’s license, departure from or disregard of plans or specifications or any building codes of the 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. [10] 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. [11] A.A.C. R4-9-108 provides, in relevant 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.

[12] 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.

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