ALJDEC decisions subject to certification as final

2016A-1845-ROC · Registrar of Contractors · 2016-09-15

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 7, 2016 APPEARANCES: Complainant Mark Steven Davis appeared on his own behalf. Coconut Contracting LLC was represented by Robert Evan Gruber, its qualifying party, member, and authorized representative. ADMINISTRATIVE LAW JUDGE: Suzanne Marwil _____________________________________________________________________ FINDINGS OF FACT The Arizona Registrar of Contractors (“the Registrar”) first issued License No. 293769, to Coconut Contracting LLC (“Respondent”) on August 3, 2015. This license was class CR21 for Landscaping and Irrigation Systems.[1] Respondent also holds License No. 302509, which is a C31 Masonry license. Both of these licenses are current. On June 2, 2016, the Registrar received a Complaint against Respondent from Mark Steven Davis (“Complainant”) alleging that Respondent had failed to complete and/or performed poor work on a large exterior landscaping project that included a water feature, fountain, lighting and pool tile installation. The Complaint also alleged that Respondent had overbilled Complainant for items not included in the contract between the parties or a subsequently signed addendum. The Registrar assigned Matt Gunstra to investigate that Complaint. On June 15, 2016, Gunstra conducted a jobsite inspection, which both Complainant’s wife, Cathleen Cuffar Davis, and Respondent attended. Gunstra noted that the parties had many verbal disputes over what work had been done by whom and for what amount. He walked the grounds and substantiated four items involving workmanship, including that lighting installed by Respondent was causing a circuit breaker to trip, incomplete lightening installed on the lower driveway wall, and two instances of failure to install trees as called for by the plan for the landscaping project. Gunstra also noted that Respondent had worked outside the scope of both of its licenses, first by installing security lights that were not low voltage and second by installing pool tile. Gunstra also reviewed the parties’ contract documents and determined that the amount Respondent billed for exceeded the contracted-for amount. On June 22, 2016, Gunstra issued a Directive to Respondent. The Directive provided in pertinent part as follows: After investigation, the Registrar has substantiated that your work fails to meet minimum workmanship standards (see A.A.C. R4-9- 108). Failure to comply with this Directive constitutes a violation of A.R.S. § 32-1154(A)(22) and may result in the issuance of a Citation, discipline of your license and a civil penalty pursuant to A.R.S. § 32-1154(E) of up to $500.00. Failure to comply with this Directive may also be treated as an aggravating factor should the Registrar pursue discipline of your license. You must provide the Registrar with satisfactory written proof of your compliance with this Directive prior to 5:00 p.m. on 7/7/16.

You are hereby directed to remedy the following violations by the appropriate means:

Complaint #1: Installed only 15 working vista pro landscape lights of 41 in contract -All incomplete lighting at the driveway that is part of the Respondent’s scope of work shall be his responsibility to complete. NOTE: Respondent may not perform or subcontract electrical work other than low voltage. See below.

Complaint #2: Received only 10 of 11 24" boxed trees in contract - Respondent shall complete project per original contract agreement, properly executed change orders and verbal agreements[.]

Complaint #3: Missing 15 gallon pigmy date palm, irrigation and DG in pool area planter - Respondent shall complete project per original contract agreement, properly executed change orders and verbal agreements[.]

Complaint #9: Damaged 2 existing security lights during work -Lights or circuits installed/modified by the Respondent are his responsibility to repair as necessary. NOTE: Respondent may not perform or subcontract electrical work other than low voltage. See below.

The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action.

Gunstra subsequently spoke to Complainant who told him that while Gruber had texted him to say he say he was out of town Respondent had yet to schedule any corrective work. On July 5, 2016, Respondent sent a letter to the Registrar disagreeing with the Directive and making it clear to Gunstra that Respondent did not intend to comply with the Directive. Therefore, Gunstra forwarded the matter to the Registrar’s Legal Department. Subsequently, Respondent paid for the missing boxed tree referred to in Complainant item number 2. Thereafter, Complainant attempted to add additional items to his Complaint, but was advised by Gunstra that it was too late and those additional items would need to be the subject of a separate complaint. The Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(3), A.R.S. § 32-1154(A)(8), A.R.S. § 32- 1154(A)(16), and A.R.S. § 32-1154(A)(22). Respondent filed a timely written answer to the Citation and Complaint. The Registrar referred the matter to the Office of Administrative Hearings (OAH), an independent state agency, for an evidentiary hearing. A hearing was held on September 7, 2016. Complainant and his wife both testified along with Gunstra and Gruber. Hearing Evidence Gunstra testified consistently with the facts detailed above. Gunstra explained his understanding of the scope of CR21 and CR31 licenses and why he believed Respondent’s work in installing the security lights and pool tile exceeded the scope of those licenses. Specifically, he explained that installation of pool tile was not within the nine items of masonry work permitted for that license. Gunstra also noted that the security lights installed by Respondent were not low voltage and were not the kind of lighting work permitted under a CR21 license, which deals with pool lights and wiring for water features. Gunstra said it was Respondent’s responsibility to understand the scope of its licenses. Gruber disputed that Respondent’s work exceeded the scope of its licenses. Gruber maintained that he had contacted the Registrar a couple of years ago and told an unidentified individual the type of pool tile installation work Respondent intended to do and was advised that he could perform pool tile installation with a CR31 license. Gruber did not obtain these alleged comments from the Register in writing. Gruber also argued that the lighting Respondent did for the pool and water feature was no different in kind that the work Respondent did on the security lights and it therefore should be permitted under Respondent’s CR21 license. Gruber acknowledged that Respondent did work on the security lights. Both Complainant and Gunstra testified that these lights did not work properly because they caused a circuit breaker to “pop” repeatedly. Gruber admitted that Respondent did not return to Complainant’s home to address this issue during the time period specified in the Directive. Gruber also agreed that Respondent deviated from the plans and failed to plant a date palm in the area specified in the plan. He blamed Complainant for using unlicensed contractors on the projects who made unforeseen changes to the border, Gruber stated the tree was planted elsewhere on Complainant’s property. Gruber acknowledged however that after Complainant elected to buy another palm to avoid uprooting the tree, Respondent refused to return and provide Complainant with the DG (rook fill) provided in the plans for the planter around that tree. Complainant and his wife both testified that Respondent agreed to install four lights in a lower driveway retainage wall and that that Cathleen had seen Respondent’s worker, Gordo, doing this work. They maintained that Respondent’s worker left the lights unfinished and missing parts. Gruber denied that Respondent had ever agreed to work on this wall constructed by an unlicensed contractor. He later clarified that Respondent did provide landscaping around the wall. Gordo did not testify at hearing. Gunstra said that he found evidence that Respondent had overcharged Complainant because the documents provided suggested that Respondent had billed Complainant more than the price in the contract and signed addendum. Complainant testified that he was in fact billed for work Respondent did without authorization or for which Respondent agreed not to charge. Complainant acknowledged that he had settled on a final amount to pay Respondent in order to avoid Respondent filing a lawsuit in another forum. Respondent contended that the final amount paid by Complainant was the final amount agreed upon by the parties after negotiation and thus no claim of overcharging was warranted. Respondent explained that overseen circumstances arose on the project and that it tried to obtain signed contract addenda without successes. Respondent believed that Complainants had taken advantage of the fact that Respondent wanted to use the project as a marketing tool and had spent many uncompensated hours on the project. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. 2. Complainant bears the burden of proof to establish Respondent’s statutory violation 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 (1952). “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. Undisputed credible testimony established Respondent did not complete work or performed work of questionable quality, including but not limited to performing work on security lighting that caused a circuit breaker to repeatedly pop, failing to provide DG to complete a planter, and failing to appropriately place trees. Complainant’s wife also offered credible testimony that Respondent’s worker Gordo began work on the lights on the lower driveway wall lights and left those lights missing parts and unfinished. Thus, Complainant established Respondent’s work on the above items included in the Directive was not done in a professional and workmanlike manner in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4- 9-108.[2] 4. The undisputed evidence at hearing established that Respondent installed pool tile and performed electrical work on Complainant’s security lights. Gunstra credibly testified that both these actions are beyond the scope of Respondent’s licenses. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(16).[3] 5. Respondent admitted it made no attempt to correct item numbers 1, and 4 on the Directive, The evidence showed that Respondent chose to dispute the Directive items and never attempted to comply with the Directive in violation of A.R.S. § 32-1154(A)(22).[4] 6. The Tribunal finds it inappropriate to sustain a charge pursuant to A.R.S. §32-1154(A)(8) where, as here, the parties admittedly reached a negotiated agreement of what each agreed was an appropriate final price for Respondent’s work.[5] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent Coconut Contracting LLC’s License Nos. 293769 and 302509 for a period of five (5) days. 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, September 15, 2016.

/s/ Suzanne Marwil Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors

----------------------- [1] Administrative notice is taken of Respondent’s licensing history, available on the Registrar’s website and reviewed on September 8, 2016. [2] 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.” [3] A.R.S. § 32-1154(A)(16) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.” [4] A.R.S. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other 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.” [5]A.R.S. § 32-1154(A)(8) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in a material respect by the licensee to complete a construction project or operation for the price stated in the contract, or in any modification of the contract.”

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