ALJDEC decisions subject to certification as final

2016A-4042-ROC · Registrar of Contractors · 2017-03-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Tonya Dee McClafferty,

COMPLAINANT,

v.

Brewer Restoration Enterprises Inc.,

License No. CR61.262668-D,

RESPONDENT.

No. 2016A-4042-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 10, 2016, at 8:30 a.m.

APPEARANCES: Tonya Dee McClafferty (“Complainant”) appeared on her own behalf; Brewer Restoration Enterprises Inc. (“Respondent”) appeared through John Brewer, its qualifying party/officer.

ADMINISTRATIVE LAW JUDGE: Diane Mihalsky

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

On or about February 10, 2010, the Arizona Registrar of Contractors (“the Registrar”) issued License No. CR61.262668-D for dual carpentry, remodeling, and repair to Respondent.

On or about October 14, 2016, Complainant filed a complaint with the Registrar against Respondent alleging poor and incomplete workmanship in Respondent’s performance of its contract to repair water damage caused by a leaking water softener at Complainant’s house at 5457 W. Panther Butte St., Marana, Arizona 85658.

Complainant attached to the complaint a copy of her contract with Respondent, which incorporated by reference the line item proposal that Respondent had submitted to Complainant’s insurer to repair the damaged caused by the leaking water softener, including the following in the garage:

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Description . . . Total

5. R&R Water softener platform – wood frame 240.70

Air Handler

209. 1⁄2” Drywall – hung, taped, ready for texture 12.01

210. Texture drywall – heavy hand texture 12.00

211. Install Metal Edge 7.48

Edge Metal for the stand

The Registrar assigned the complaint to its Investigator, John Smith, for investigation. Investigator Smith performed a jobsite inspection and on December 12, 2016, issued a directive to Respondent to repair 38 complaint items on or before 5:00 p.m. on December 28, 2016. Item 33 of the Directive required Respondent to repair the following:

“Bid item 5 not done, or done poorly (Garage; R&R water softener platform – wood frame) IMPORTANT! Could cause another flood.”

The remaining repairs mostly concerned Respondent’s failure to texture drywall and paint baseboards in a professional and workmanlike manner in various areas of Complainant’s house.

On January 4, 2017, Investigator Smith performed a compliance jobsite inspection. His jobsite inspection notes stated that ten complaint items still required correction. Investigator Smith noted that Respondent had not done anything to correct item no. 33 on the Directive and that it was still in the same condition as at the original jobsite inspection.

Investigator Smith referred the Complaint to the Registrar’s Legal Department. On January 5, 2017, the Registrar issued a Citation against Respondent’s license, charging cause to revoke or suspend Respondent’s licenses under A.R.S. § 32-1154(A)(2), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(22).

Mr. Brewer filed a timely written answer to the Citation on behalf of Respondent, stating that it had made many attempts to bring the painting within the Registrar’s workmanship standards. With respect to item no. 33 on the Directive, Mr. Brewer acknowledged that Respondent had not rebuilt the platform in the garage, explaining as follows:

We did not do this service as directed by [Complainant]. She decided not to reinstall the water softener after the contract was signed. When we originally walked through the home with [Complainant], she pointed out the problem with the water softener. She said the softener burst 3 times up to that point. I recommended a platform to place the softener on. The platform would include a plywood skinned 2/4 wall that would extend above the softener so the water pressure of future breaks would be halted. We have repaired many flooded homes that were damaged by the water boring through the sheetrock after the line breaks. This has been the best protection we have found. We bid this item at $240.70. We offered to remove this item from the contract since [Complainant] did not want it built. She refused to remove it and wanted us to repair the HVAC platform instead. The HVAC platform was not structurally damaged in this water leak. 1.5 square feet of sheetrock on the front corner was wet and was removed by the dry out company. We removed all the sheetrock and replaced it along the base of the platform but the HVAC was [not] part of our contract.

A telephonic evidentiary hearing was held on March 10, 2017, from the Registrar’s office in Tucson. Complainant testified on her own behalf. Mr. Brewer testified on Respondent’s behalf. Investigator Smith also testified.

Hearing Evidence

Mr. Brewer testified that Respondent was willing to pay another contractor to complete the nine items that involved painting that Investigator Smith found still did not comply with the Registrar’s minimum workmanship standards.

Complainant testified that she elected not to replace the water softener in the garage because she did not want to risk another flood in her house. Complainant testified that she told Mr. Brewer that she did not intend to replace the water softener.

Investigator Smith acknowledged that Respondent could not build a platform under a water softener that did not exist, but testified that Respondent should have issued a change order to memorialize the omission of the platform beneath the water softener. Allowing the platform to remain on the contract was a mistake.

The water heater and air handler for the HVAC system on Complainant’s house are located on the opposite side of the garage from where the water softener was formerly located. The water heater and air handler are installed on a platform, but the water softener was not. The platform under the air handler and water heater has evidence of water damage. Both parties and Investigator Smith agreed that the platform under the air handler and water heater probably should be replaced because the water heater was starting to lean.

Mr. Brewer testified that it would cost $1,700.00 to replace the platform under the water heater and air handler. Mr. Brewer testified that he did not include the cost of replacing the platform in the estimate that Respondent submitted to Complainant’s insurance company because the damage to the platform was not caused by the leaking water softener. Mr. Brewer explained that leaking water softener had only flooded the bottom part of the platform for the water heater and air exchanger, but that the platform was damaged at the top. Mr. Brewer testified that he believed that the damage to the platform was caused by a slow leak from the water heater before it was replaced.

Complainant acknowledged that she bought the house in a foreclosure sale and that she may have replaced the water heater as part of her renovations after her purchase. Complainant testified she hired a plumber named Danny Rodriguez to flush the water hearing in the December before the water softener leak and that Mr. Rodriguez told her that the platform holding the water heater and air handler was not damaged at that time. Complainant testified that Mr. Rodriguez told her that replacing the platform under the water heater and water softener would cost $2,000.00.

Mr. Brewer testified that when he replaced the small area of drywall at the bottom part of the platform holding the water heater and air handler, he saw that the top of the platform had wood rot caused by long exposure to water.

Complainant testified that although the water softener had leaked for 14 hours, very little drywall was damaged around the platform holding the water heater and air handler because the remediation contractor used a wall drying system.

Mr. Brewer testified that his bid did not include replacing the platform beneath the water heater and air handler because he could not charge the insurance company for a repair that was not caused by the covered event. Mr. Brewer testified that the water softener had shot water into the house, away from the water heater and air handler.

Mr. Brewer explained that the Exactimate software that Respondent used to prepare proposals for insurance companies inserted the “R&R wood frame Air Handler” into his quote, and the best he could do was insert the “Water softener platform” into the boilerplate.

Investigator Smith testified that he had seen water stains at the bottom of the platform holding the water heater and air handler. He could not see the upper part of the platform.

Pursuant to A.A.C. R4-9-117, administrative notice is taken of the Registrar’s public website. On this date, Respondent’s license was current and in good standing, had no history of discipline, and showed only one administrative suspension between February 28, 2011, and March 28, 2011, for lack of bond.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainant bears the burden of proof to establish cause to suspend or revoke Respondent’s license by a preponderance of the evidence. Respondent bears the burden to establish factors in mitigation of the penalty and affirmative defenses by the same evidentiary standard.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Complainant established cause to discipline Respondent’s contractor’s licenses under A.R.S. § 32-1154(A) (3), namely A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(22) based on the nine areas that Investigator Smith found that Respondent had failed to initially construct and perform appropriate corrective work to bring these areas into compliance with the Registrar’s minimum workmanship standards.

Respondent’s line item bid to the insurance company stated that it would construct a platform under the water softener, but incidentally referred to the air handler. The proposal refers to only one platform. Mr. Brewer’s testimony about the Exactimate software explains the reason for the ambiguity. The cost of the line item bid was far less than both parties’ evidence of the cost to replace the platform under the water heater and air handler. Mr. Brewer credibly the evidence that he saw that showed that the water damage to platform beneath the water heater and air handler was not caused by the leaking water softener. Mr. Brewer’s testimony was consistent with Investigator Smith’s testimony and the other evidence in the record.

Complainant’s testimony about Mr. Rodriguez’s alleged statements about the condition of the platform beneath the water heater and air handler before the air softener leak is hearsay. Although hearsay may be admitted in an administrative hearing, it should not be relied upon if it is not the kind of evidence that reasonable persons would rely upon in serious matters. In light of Mr. Brewer’s credible testimony, a reasonable person would not rely on Mr. Rodriguez’s hearsay statements to suspend or revoke Respondent’s license because it failed to replace the platform beneath the air handler and water heater.

Therefore, Complainant did not establish cause to suspend or revoke Respondent’s license under A.R.S. § 32-1154(A)(2) or any other charged statute because it did not replace the platform under the water heater and air handler. Although Complainant’s insurance company may be due a refund of the $240.70 that Respondent charged for the platform that it did not build beneath the non-existent air handler, this technical violation does not entitle Complainant to any further relief in this forum.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the order in this matter, License No. CR61.262668-D of Respondent Brewer Restoration Enterprises Inc. shall be suspended for a period of one calendar day.

It is further recommended that Respondent shall pay the sum of $250.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the final order, the Registrar revoke Respondent’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty.

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 five days from the date of that certification.

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Done this day, March 21, 2017.

/s/ Diane Mihalsky

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors