ALJDEC decisions subject to certification as final

2017A-4069-CHC-ROC · Registrar of Contractors · 2018-03-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Denise Kloss,

COMPLAINANT,

v.

CKBR LLC dba,

Complete Kitchen and Bath Remodeling ,

License No: 266889

RESPONDENT.

No. 2017A-4069-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 25, 2018, at 1:00 p.m.

APPEARANCES: Denise Kloss (“Complainant”); Angela Cooner (“Ms. Cooner” attorney1 for Complainant); Shad Beavers (“Mr. Beavers” attorney2 for Complainant); Donald Wilkerson (“Mr. Wilkerson” representative for CKBR LLC dba Complete Kitchen and Bath Remodeling “Respondent”); Charles Halsey (“Mr. Halsey” attorney for Respondent); Michael Romano (“Mr. Romano” witness1 for Respondent); Jessica McCoun (“Ms. McCoun” observer for Respondent); and Steven Lawton (“Investigator Lawton” senior investigator for the Registrar of Contractors “ROC” or “Registrar”).

ADMINISTRATIVE LAW JUDGE: Linda Marie Brown

_____________________________________________________________________

The hearing was convened to determine whether Respondent violated the charged provisions Arizona Administrative Code R4-9-108, minimum construction standards, and thereby of A.R.S. § 32-1154(A)(3); and A.R.S. § 32-1154(A)(22) failure to take appropriate corrective action without valid justification, as alleged by Complainant and as cited by the Registrar. Findings of Fact, Conclusions of Law and Recommended Order are made based on the testimony and evidence.

FINDINGS OF FACT

Complainant is the owner/occupant of a residence located at 27443 North 75th Way, Scottsdale, Arizona 85266.

CKBR, LLC dba Complete Kitchen and Bath Remodeling (“Respondent”) is the holder of Arizona Contractor License No. B-3.266889-R, Donald Lee Wilkerson, Jr., is listed as both the qualifying party/member, and License No. R-11-297310-R, lists Jared Michael Simonton, as the qualifying party, and Donald Lee Wilkerson, Jr., as the member. Both licenses are current as of the date of this hearing.

On or about August 2, 2017, Complainant submitted a Complaint with the Registrar alleging 38 complaint of issues against Respondent to include poor workmanship. Complainant indicated in her complaint that she contracted with Respondent on or about April 17, 2017, and work started in late April 2017.

Respondent provided in its Prehearing Disclosure Statement a copy of the contract between the parties. The scope of the work to be performed was:

“We are remodeling the kitchen as per plan. The Guest suite as per plan, the flooring and all things mentioned in the separate contract pages. See payment schedule on additional payments. Total Project Costs: $159,000.00.”

Additional pages in the separate contract pages included Project Scope the Master Bathroom, Guest Bathroom, Kitchen, Living Room, Great Room, Laundry Room, Foyer, and 17 Miscellaneous items such as paint exterior repaired pigeon netting.

Pages 9 and 10 of the parties Contract set forth the payment schedule. Complainant stated in her complaint that Respondent received a total of $87,700.00 in payments of the $159,000.00 contract amount. The parties agree that $87,700.00 was the amount paid to Respondent.

Respondent also provided an undated change orders that appear to follow from the initial contract date.

Investigator Ted Stodder was assigned to investigate the Complaint. On August 22, 2017, he sent to Respondent two (2) Warning Letters advising to remedy and bring into compliance the following: a violation of A.R.S. § 32-1158(A) minimum elements of a contract; and A.R.S. § 32-1124(B), contract does not include your license number preceded by the acronym “ROC”.

Investigator Stodder performed a Jobsite Inspection on September 8, 2017. Both Complainant and Respondent were present. Investigator Stodder uploaded photos to case and evidence files. Investigator Stodder wrote in his report that Complainant provided him with a “punch list items,” and that he looked at the list and explained to Complainant that some of the items were not contracted items. He also noted that Respondent stated he thought he had been fired but had no evidence. Investigator Stodder wrote in his jobsite inspection notes that “project was in an incomplete state. SUBstantiated.”

A Directive issued on September 11, 2017, requiring proof of compliance no later than October 5, 2017, to remedy the following by appropriate means: “Complete Phase I of home remodeling project per plans/contract/approved change orders.”

On October 6, 2017, a Citation was issued citing the following: Charge 1: A violation of Rule 4-9-108, titled “Minimum Construction Standards,” in the Arizona Administrative Code, and thereby of A.R.S. §32-1154(A)(3); and Charge 2: A violation of A.R.S. 32-1154(A)(22) (“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 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.”)

Respondent submitted its Written Answer to the Citation on October 23, 2017. In its reply, Respondent asserts that Complainant had terminated another contractor midway. He further wrote that Complainant went on vacation around July 4 and upon her return the relationship changed from this point forward. He wrote that Complainant terminated them in mid to late July even after they expressed desire to finish the project. Respondent stated that Complainant was seeking a settlement agreement and to part ways. He further wrote that Complainant asked its workers to perform tasks that were not listed on the contract or on the punch list she created. Respondent stated that on October 9, 2107, his worker, Jeff was denied entry Respondent took the position in its reply to the Directive that there is no Phase I outlined anywhere in the plans/contract/approved change orders.

A Notice of Hearing was sent to the parties on October 31, 2017, that a hearing is scheduled on the charges made in the Citation and Complaint to be held before the Office of Administrative Hearings.

HEARING EVIDENCE

Angela Cooner (“Ms. Cooner”) provided Complainant’s Opening Statement to which she asserts testimony and evidence will prove that Respondent should be disciplined for poor workmanship and have its license suspended, and Complainant should be awarded restitution.

Respondent’s attorney (“Mr. Halsey”) stated in its Opening Statement that no compliance inspection was conducted prior to issuance of the Citation, and that the Directive was unclear as to what Phase I is, as there is no reference to a Phase I in the parties’ contract.

Senior Investigator Steven Lawton testified that Investigator Stodder is no longer with the Registrar and he was assigned to review the case and continue in handling Complainant’s Complaint.

Investigator Lawton provided credibly testimony as to the Registrar’s involvement in this matter. He further stated that a compliance inspection is not mandatory and is up to each investigator.

Investigator Lawton did conduct a prehearing inspection on December 19, 2017, and indicated that the parties were working from an updated punch list dated September 3, 2017, that was provided by Complainant.

Ms. Cooner questioned Investigator Lawton regarding the remaining eight (8) items that still needed to be remedied as listed on the document tilted punch list items yet to be done on the first half of the house.

Respondent’s Counsel asked Investigator Lawton if he is able to determine what Phase I is. Investigator Lawton replied he referred to Complainant’s punch list during his walk through to determine items that were still incomplete.

Denise Kloss (“Complainant”) testified that the contract indicated all one project but that it was suggested to split the project into two phases so that she could live on one side of the house while Respondent performed work to the other side. Ms. Cooner provided an illustration (not to scale) of the residence’s floor plan and stepped Complainant through each room on what work Respondent was contracted to perform.

Complainant worked through the September 3, 2017, punch list and indicated there were 10 items left unfinished as she overlooked items I, Miscellaneous (6) and I. Miscellaneous (8) when Investigator Lawton was testifying as to the punch list.

The items remaining on the punch list were as follows: A. Dining Room (1) repair windowsill (patch and repaint) for plantation shutter prior to install and install painted plantation shutter); B. Master Bathroom (4) Fix master bath sliding mirror door; it is very difficult to slide and was not that way prior to CKBR removing doors and reinstalling doors; D. Exterior (1) Repair and repaint stucco where new window in master bath was installed and where new patio sliding door was installed, and touch up outside with paint on areas stained with concrete mixing; (2) Repair and repaint stucco at SE corner of house near roof line; E. Laundry Room (4) Add cat door to door in laundry room; F. Foyer (1) repair or replace doorbell; H. Living Room (1) Change look on cascade door to a floor lock system as well as replace screen doors with a different locking system; I. Miscellaneous (6) Replace interior doors with 5 panel doors from Lowes – 6; and (8) Add hinge door stops to appropriate doors (front entrance door and all other new doors).

Respondent questioned Complainant regarding whether she asked for her key back or denied access to Respondent to address her concerns. She replied that they did have access to the project up to August 15, 2017, and that after that date, they would need to schedule work days and knock.

Don Wilkerson is the owner of CKBR LLC and has been in business for 49 years. Mr. Wilkerson testified that the contract never expressly set forth a Phase I. Ms. Cooner asked Respondent if it was suggest to block off certain portions of the home for animal control to which he agreed. She also asked if he was aware that under A.R.S. §32-1158(A), he is required to list an estimated date of completion and his contract fails to do so.

Mike Romano (“Mr. Romano”) was called as a witness for Respondent. Mr. Ramono was responsible for heading up the Kloss Project. He testified that he was working from the punch list to remedy the Complainant’s concerns and that he provided the list to the stucco guy. He indicated that additional items were added and they replaced the threshold that was not under Contract, and that Complainant wanted them to move pallets of tile from the driveway. When asked if Respondent was responsible for the pallets, he replied, no, they were left there from the previous contractor.

Mr. Romano testified that based on the September 3, 2017, punch list, regarding Item E.(4) that because of the changes Complainant kept making, they initially ordered the doors and had to cancel and reorder.

Mr. Romano disagreed with punch list item H.(1) and testified that the Registrar’s Investigator stated the manufacturer door complies and that items under I. Miscellaneous needed three (3) week lead time to order blanks, mortar, hinges and painting and already ordered twice. He also testified that the stucco contractor needed about 3 for 4 days to perform work.

Respondent argued that they were given a “poorly written” directive as it was unclear what Phase I is since the contract did not spell out a Phase I. Respondent also raised concerns on the gap in time from the last jobsite inspection and the prehearing inspection and identifying who did what as other contractors may have performed work during the gap in time.

Complainant is requesting that the Respondent be disciplined for failure to timely complete all of the items on the punch list, and that Complainant did provide access to allow Respondent to remedy but they failed to timely do so without valid justification.

The parties asked for a Recess and went off the record to discuss possible settlement. Shad Beavers (“Mr. Beavers”) indicated that the parties would continue to work towards settlement and that they would provide a status update no later than February 9, 2018.

Not having heard, on February 26, 2018, the OAH contacted the parties and were advised on February 27, 2018, that no settlement was reached.

CONCLUSIONS OF LAW

The Registrar has jurisdiction over this matter, pursuant to A.R.S. § 32-1101, et seq., which authorizes the Registrar to impose disciplinary sanctions against licenses for violations of A.R.S. § 32-1154.

To warrant such sanctions by the Registrar, Complainant must demonstrate by a preponderance of the evidence that Respondent violated the statutory section cited. Proof by a “preponderance” means that “the evidence is sufficient to persuade the finder of fact that the proposition is more likely true than not.” In re: Arnold and Baker Farms, 177 B.R. 648 (9th Cir. BAP (Ariz.) 1994). See also Culpepper v. State of Arizona, 187 Ariz. 431, 930 P.2d 508 (App. 1996). It is “evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (Rev. 6th ed. 1990).

Credible testimony established Respondent performed substandard work, specifically, failure to timely complete the items that were contracted to be performed and identified in the punch list as determined in the Directive as not complete in a professional workmanlike manner in violation of A.A.C. R4-9-108 and thereby of A.R.S. § 32-1154(A)(3). This tribunal agrees with Respondent that Phase I was not clear or the term made a part of the Contract but disagrees that Respondent was unaware of the expectation on what contracted items needed to be remedied as duly noted on the September 3, 2017, punch list that was shared between the parties and apparently referenced as a work-through list to remedy Complainant’s concerns.

An A.R.S. § 32-1154(A)(22) violation is warranted even though Respondent made good faith efforts to take corrective action to complete the items set forth in the Punch List. Unfortunately, at hearing there were still items in need of attention. This Tribunal also takes into account that the project began sometime in April 2017, and that by August 15, 2017, when Complainant asked for her key to be returned, numerous items were still left in a substandard workmanship condition. Investigator Stodder also substantiated Complainant’s concerns during his jobsite inspection conducted on September 8, 2017.

Investigator Lawton credibly testified that he performed a walk through and referenced the punch list as to the workmanship items left remaining to be remedied.

The preponderance of the evidence established that Respondent failed to timely remedy the remaining concerns listed on Complainant’s punch list dated September 3, 2017. This failure resulted in poor workmanship standards. While the Respondent attempted to take appropriate means to comply with the Directive, this Tribunal concludes that Respondent violated the charged provisions of A.R.S. § 32-1154(A)(3), namely, A.A.C. R4-9-108, and 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 CKBR, LLC dba Complete Kitchen and Bath Remodeling License Nos. B-3.266889-R and R-11-297310-R for a total of two (2) days.

It is also recommended that Respondent pay the sum of $500.00 to the Registrar of Contractors by way of a civil penalty pursuant to A.R.S. § 32-1154(E). The failure by Respondent 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 Respondent’s contractor’s licenses 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 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 five days from the date of the certification

Done this day, March 1, 2018.

/s/ Linda Marie Brown

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors