ALJDEC decisions subject to certification as final

2015A-2400-ROC · Registrar of Contractors · 2016-02-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 8, 2016 and February 3, 2015 APPEARANCES: Rick Alfaro (Rick), owner of Alfaro Concrete LLC appeared on behalf of Complainant. Legacy Custom Building and Remodeling Inc. dba, Legacy Design Build Remodeling was represented by Stewart Truitt., its qualifying party and representative. ADMINISTRATIVE LAW JUDGE: Suzanne Marwil _____________________________________________________________________ FINDINGS OF FACT 1. Legacy Custom Building and Remodeling Inc. dba, Legacy Design Build Remodeling (Respondent) is the holder of License No. 079330 issued by the Registrar of Contractors (Registrar). 2. On June 4, 2015 Alfaro Concrete LLC (Complainant) filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay its January 19, 2015 invoice totally $5,200.00 stemming from concrete and demolition work it had performed at the Connor residence at Respondent’s request. 3. On June 23, 2015, Respondent responded to the Complaint noting that “Legacy has incurred over $6,941.00 worth of expenses to do the work Alfaro Concrete was contracted for. We feel that [Complainant] is due absolutely nothing for his participation in this project and if anything, owes us for the overages in repairing his work.” 4. The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a formal Citation charging Respondent with a possible violation of A.R.S. § 32-1154(A)(10). 5. At hearing, the parties agreed that they had entered into a subcontract dated December 23, 2014, that called for Complainant to perform demolition in various rooms and perform concrete work to assist with a patio to family room conversion. That subcontract specified that Complainant was to “remove 4 inch concrete slab” of the existing patio and pour a new slab and footings. The subcontract did not mention constructing a brick ledge. 6. It is undisputed that Complainant performed demolition work and saw cutting of interior slabs on January 6 and 7, 2015. Complainant returned to complete demolition work on January 14, 2015. 7. The $5,200.00 invoice was sent to Respondent before the work was completed. 8. In February 2015, Enrique David Alfaro went to the Connor residence to do some demolition work and set up footings, He recalled speaking with Esteban Romero, and being shown some plans, but no details. According to David Alfaro, he and Romero agreed that they would not remove the existing concrete slab when setting up the addition to the patio.[1] David Alfaro demolished only the tile off the slab and the footings. 9. During this work, a post came loose on the patio causing the roof structure to fall approximately 18 inches. David Alfaro testified that the post fell because Respondent had not used appropriate bracing while Respondent speculated based on what Mr. Connor reported that David Alfaro hit the post in some way after digging footings in that area. 10. The roof of the patio was later raised by Stewart Truitt and Romero, employees of Respondent. 11. David Alfaro subsequently poured the concrete in a monolithic pour and assumed Complainant’s work on the project was complete. 12. Rick Alfaro testified that his wife, Carole Alfaro, attempted to obtain payment for the job for months and heard nothing. Both he and Carole Alfaro said that Respondent assured them late payment was the result of money problems and impending sale of Respondent. Rick indicated that Complainant was willing to work with Respondent and wait for payment because they had done business for years. 13. Rick testified that Respondent first informed him there was a problem relating to the lack of a brick ledge in April 2015. He noted the ledge was not in his contract but he wanted to make everyone happy by doing what Legacy asked him to do, as was his practice. 14. Esteban Romero testified that about a week after the concrete was poured, he noticed the problem of the lack of a brick ledge and reached out to Rick. Truitt and Romero both recalled telling Rick Alfaro on April 25, 2015, to wait for a structural engineer to come up with a fix. 15. On April 30, 2015, Rick Alfaro added the brick ledge. The structural engineer’s report arrived on May 6, 2015. Esteban said that because the ledge work was done before receiving the structural fix and did not contain rebar, he broke it out to be redone. 16. Truitt testified that following the pour, the homeowner and Respondent noted problems with the control joints and cracking in the concrete. Once the problems with the incorrect brick ledge occurred, Connor told Respondent that he would not pay until all the work was fixed. 17. Truitt said he then told Complainant that its invoice would not be paid until Respondent learned the cost of fixing the problems with its work. He indicated he did not give Complainant the opportunity to correct its work because Connor did not want Complainant to do so. 18. Michael Connor did not testify, but Respondent submitted two emails from Connor that detail his problems with Complainant’s concrete work. See Exhibit 3 (email dated January 5, 2016 detailing his problems with Complainant not removing the old concrete slab per the scope of work, cracks forming in the newly poured slab that were wide enough to put a dime between and the failure to support the brick ledge with rebar as required for support). Connor’s email concludes: “I told [Respondent] that this [was] unacceptable and I wanted the whole concrete removed[.] I didn’t trust [Complainant] and I want the work redone per the scope of work I paid for.” 19. Respondent submitted invoices showing that they paid Fine Line Concrete Cutting $2,384.00 to demolish Complainant’s new slab and remove the old patio slab. See Exhibit 2. Respondent also submitted an invoice totaling $4,735.00 from Saturn Concrete, the company paid to repour the slab and redo the brick ledge with rebar. The cost of these repairs exceeded the amount of Complainant’s invoice even without taking into account the cost of the structural report that appears to cover the patio and other issues not at issue in this matter or the cost of treating the new patio for termites. 20. Rick Alfaro testified he thought it was unfair he was not afforded an opportunity to correct the problems with the concrete slab and that he would have done so if given the opportunity. 21. Truitt testified that Connor did not want Complainant to return so new contractors were hired at considerable expense. He said that Respondent decided not to pay Complainant for the work it had done, but also not to charge Complainant for the overages expended to correct his work. Truitt acknowledged that Respondent did not file a complaint with the Registrar regarding Complainant’s work. He stated that when it comes to Respondent’s subcontractors, if workmanship issues arise, Respondent just severs the relationship and pays for corrective work as it did in this case. 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. A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, [f]ailure by a licensee . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee’s operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.

4. After review of all the evidence, the Tribunal concludes that Complainant has failed to meet its burden of proof that it performed work of value to Respondent. While Complainant presented evidence that it performed work, Respondent submitted evidence that this work later had to be redone at considerable cost to Respondent. Because it remains unclear whether Respondent owes Complainant any money, Complainant has not established more probably than not that a violation of A.R.S. § 32-1154(A)(10) has occurred. RECOMMENDed order Based on the foregoing, it is recommended that the Registrar dismiss Complainant’s complaint. 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, February 23, 2016.

/s/ Suzanne Marwil Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] The plans for the project were approved by the Town of Gilbert on January 6, 2015. Esteban Romero maintained that he gave Rick Alfaro a sheet of plans and then kept the floor set of plans on site at the Connor residence.

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