ALJDEC decisions subject to certification as final

2017A-2190-CHC-ROC · Registrar of Contractors · 2017-09-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Stacey M. Smith,

COMPLAINANT,

v.

Seven Foot Construction LLC,

License No: 220001

RESPONDENT.

No. 2017A-2190-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 23, 2017

APPEARANCES: Complainant Stacey M. Smith appeared and was represented by James Cool. Klaus Mehrens, Owner and Qualifying Party, appeared on behalf of Respondent Seven Foot Construction LLC.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

Seven Foot Construction LLC (Respondent) is the holder of License No. 220001 issued by the Arizona Registrar of Contractors (Registrar).

On or about February 8, 2017, Stacey M. Smith (Complainant) entered into a verbal contract with Respondent to remodel her condominium.

On or about April 26, 2017, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to the project.

The Registrar assigned the complaint to Investigator Ted Stodder. After a jobsite inspection, Investigator Stodder issued a written directive to Respondent that provided 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 June 9, 2017.

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

Cabinet damage needs to be repaired.

Floors must be level prior to the installation of tile.

Tile lippage cannot exceed 1/16”.

Grout lines shall be grouted to the level to the tile.

Complete project per contract.

Note: Charges in addition to the original contract are only allowed if they are covered in a written and signed change order.

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

Following the issuance of the written directive, Complainant, through her attorney, and Respondent had discussions regarding the work to be done. Complainant asserted that because the parties did not have a written contract, Respondent was unable to “[c]omplete project per contract” and if it would complete items one through four from the written directive, Complainant would withdraw any complaint relating to item five. Respondent asserted that it should be allowed to complete other work required by the verbal contract before or at the same time it completed the other four items in the written directive. Because the parties were discussing the matter and how to go about completing the corrective work, Investigator Stodder extended the deadline for compliance to June 19, 2017.

On June 7, 2017, Mr. Mehrens emailed Complainant’s counsel and stated, in relevant part, that “[m]uch detail needs to be discussed before we can complete work,” “I would like to see a comprehensive framework in place that includes payment amounts and schedule BEFORE commencing work,” and “I don’t want to get the runaround trying to get paid after I have completed my responsibilities.”

On June 7, 2017, Complainant’s counsel responded that “I trust your message is not an attempt to condition your performance of the ROC’s directives in any way on my clients paying you additional money.”

On June 8, 2017, Mr. Mehrens responded to Complainant’s counsel, in pertinent part, that

While the ROC does not specifically address payment to me, work order item #5 clearly implies that after I meet the terms of the contract, your clients are also expected to meet theirs. There will be additional charges to your clients for leveling the subfloor (tile work is on me of course). My corrective work does not depend on your clients’ upfront payments.

When Complainant’s counsel inquired why Mr. Mehrens believed there would be an additional charge for leveling the subfloor, Mr. Mehrens responded as follows:

The floor leveling was not included in the estimate because I could not evaluate the scope of the concrete subfloor until after I removed all the existing flooring. Subfloor leveling typically costs hundreds (to fill in low areas like I did), or thousands (when bringing a specialty concrete grinder to remove subfloor material).

On June 19, 2017, Complainant’s counsel sent an email to Respondent’s counsel at that time, clarifying an earlier conversation. According to Complainant’s counsel, Complainant “merely sought clarification before moving forward of precisely what work [Respondent] felt ‘completing the contract’ involved since the parties have no signed contract and [Respondent] provided [Complainant] three different unsigned estimates for very different amounts.”

Ultimately, the parties were unable to reach an agreement as to the work to be performed. After the deadline expired, Investigator Stodder was notified no corrective work had been performed.

The Registrar issued a Citation against Respondent, charging possible violations of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3); and A.R.S. § 32-1154(A)(22).

Investigator Stodder testified that the Registrar does not dictate the order, means, or methods contractors use to comply with a written directive. Investigator Stodder stated that contractors are responsible for ensuring a subfloor is appropriate before installing flooring. Investigator Stodder indicated that a contractor could include a line item in the contract that the cost of leveling the floor was “TBD” to ensure the work was addressed in the contract. Investigator Stodder also testified that a contractor is not to charge a homeowner for corrective work performed pursuant to a written directive from the Registrar.

Mr. Mehrens testified that as the project went on, Complainant increased the scope of work to be done, but acknowledged that the parties did not have a written contract and did not execute any change orders. Mr. Mehrens denied demanding payment prior to completing any corrective work, but admitted he wanted to complete the contract to ensure he would get paid the full amount the parties had agreed upon. Mr. Mehrens testified that Respondent did not level the floor properly and was directed to level the floor, but asserted that Respondent was allowed to charge Complainant more to level the floor as part of the corrective work.

Administrative notice is taken of Respondent’s prior License record on September 10, 2017. Such prior License record reflects that Respondent’s License No. 220001 was first issued on May 21, 2006, and is current. Such prior License record also reflects that there were no other open or prior complaints against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

Complainant bears the burden of proof to establish Respondent’s statutory violations 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).

The evidence established that Respondent’s work was not in conformity with the Registrar’s standards. Therefore, Complainant established that Respondent did not complete the project in a workmanlike manner in violation of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3).

The evidence established that Complainant and Respondent did not have a written contract and were unable to agree on the terms of the scope of work to be completed at the time the written directive was issued. As such, it was not possible for Respondent to complete the contract as directed. Contrary to Respondent’s position, Complainant was not required to allow Respondent to complete what it thought was the agreed upon contract and then face additional charges from Respondent including hundreds or thousands more for leveling the subfloor. While Respondent was unable to complete the project per the contract, Respondent made no effort to complete the other corrective work following the written directive being issued by the Registrar. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent’s License No. 220001 for a period of five days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 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 Registrar’s 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 40 days from the date of that certification.

Done this day, September 11, 2017

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors