ALJDEC decisions subject to certification as final

2017A-4333-CHC-ROC · Registrar of Contractors · 2018-03-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Fenton Investment Co. Inc.,

COMPLAINANT,

v.

Rock Roofing LLC,

License No: 160029

RESPONDENT.

No. 2017A-4333-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: February 12, 2018

APPEARANCES: Steve Fenton, Complainant; Corey B. Larson Esq., Respondent’s legal counsel , Javier Valenzuela, Respondent Member and Qualifying Party, John Smith, ROC Investigator.

ADMINISTRATIVE LAW JUDGE: Randolph D. Wolfson

_____________________________________________________________________

FINDINGS OF FACT

Respondent, Rock Roofing LLC, (Respondent) is the holder of License No. 160029 issued by the Arizona Registrar of Contractors (Registrar).

Fenton Investment Co. Inc., (Complainant) entered into a written contract with Respondent to seal a portion of a flat roof on several commercial buildings.

On or about August 21, 2017, the Registrar received a complaint against Respondent from Complainant alleging Respondent performed poor work in that the roof sealing performed leaked water down into Complainant tenant’s leased space.

The Registrar assigned the complaint to Investigator John Smith. On or about October 12, 2017, after a jobsite inspection on October 10, 2017, Investigator Smith issued a written directive to Respondent that provided as follows [CWO]:

“Bottom line roof is leaking” Leaks were substantiated around the roof hatch of building B, and around insulated refrigerant lines of a small A/C unit on building C

“It continues to cause damage.” There is one stained ceiling tile in suite B220 below the substantiated leak around the roof hatch. There are two stained ceiling tiles in the northwest suite of building C below the substantiated leak by the A/C refrigerant line.

“excess ponding” Water is ponding 3⁄4” deep by the roof drains/crickets of building C, the northwest and southwest corners of the building.

“...poor workmanship.” This was described to be cracks and fabric showing through the roof coating in several areas throughout the roofing on all three buildings, excluding tiled areas.

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

You must notify the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on October 31, 2017.

Following the issuance of the CWO to the Respondent a compliance inspection was conducted by Mr. Smith on for November 21, 2017. Mr. Smith reports his compliance inspection observations that the Respondent failed to comply with the CWO. Mr. Smith’s notes from his compliance inspection state:

Building A: no leaks were substantiated. Building B: The respondent acknowledged a gap around the roof hatch is actively leaking. Building C: The respondent acknowledged a gap around the insulated refrigerant line of a small A/C unit is leaking.

Building A: No interior damage is substantiated. Building B: Suite B220: There is one stained ceiling tile below a leak acknowledged by the respondent, below the roof hatch area. Building C: suite at northwest corner: There are two stained ceiling tiles below a leak acknowledged by the respondent, below the gap found in the insulated A/C refrigerant line

Building A: all ponding is 1/2" or less in depth. Building B: all ponding is 1/2" or less in depth. Building C: ponding by the northwest and southwest roof drains/crickets is 3/4" deep. Workmanship allows for pond up to 1/2" deep.

There are several areas of cracks, and several areas of roof fabric showing through the roof coating. These areas are in random locations throughout the roofs of all three buildings. The respondent agrees all these areas need to be corrected, and stated he is planning on doing so.

On November 22, 2017, The Registrar issued a Citation against Respondent, charging possible violations of Rule 4-9-108, titled “Minimum Construction Standards,” in the Arizona Administrative Code, and thereby of A.R.S. § 32-1154(A)(3); A violation of A violation of A.R.S. § 32-1154(A)(12)(“Failure in any material respect to comply with this chapter.”). Namely A.R.S. § 32-1158; and A violation of A.R.S. § 32-1154(A)(22) (“Failure to take appropriate corrective action).

Following a proper notice of hearing to all parties, a hearing was held on February 12. 2018 to determine the merits of the charges in the Citation.

Investigator Smith testified consistent with his notes of the job site inspection and the compliance inspection. At the October 10, 2017 job site inspection, the Complainant and a Respondent representative were present. In building A and building C, leaking was confirmed, on one of the roofs there were 3 ceiling tiles with water stains and he observed water ponding of about 3⁄4 inches on the roof He testified that any repairs for the stains or other evidence of water leakage in the interior of any of these buildings were not within the Respondent’s scope of license and were not part of his CWO. He testified that on his compliance inspection of November 21, 2017, he was not able to observe any leaking or ponding and, to him the roofs appeared water tight.. He pointed out that on November 28, 2017, Respondent e-mailed him to advise the Respondent had undertaken to resurface the entirety of the contracted roof areas.

On October 12, 2017, Inspector Smith sent the Respondent a warning letter stating:

It appears that you may have violated A.R.S. § 32-1158(A). Under that statute, any contract for more than $1,000.00 between a contractor and a property owner must contain nine specific elements. Your contract is missing at least one of the required elements... A failure to comply with A.R.S. § 32-1158(A) violates § 32-1154(A)(12), and that violation can constitute grounds to suspend or revoke your license. You need to review A.R.S. § 32-1158(A) and make sure you are complying with its requirements.

At hearing in this matter, there was no evidence presented by any testimony or exhibit regarding whether the Respondent failed to comply with any of the elements of A.R.S. § 32-1158(A)

Complainant testified that he contracted with a licensed contractor to provide water tight roofs and immediately after the work was done, the roofs leaked. The Complainant said he had to replace carpets and ceiling tiles for several of his tenants as a result of the leaking. All three roofs were leaking, he said, when subjected to cross-examination by the Respondent, he admits having conversations with the Respondent about being warned that the underlayment of the existing roof was not in good condition was in need of the roofs themselves needing a complete replacement. The Complainant was of the belief that the warning related to some other job site project on North Oracle Street in Tucson, Arizona and not regarding the project that was the focus of the citation.

For the Respondent, Qualifying Party Javier Valenzuela provided testimony. He explained that the roofs on the three buildings under contract for his company to resurface were buildings with existing roofs.

He stated that these roofs were in need of repairs in general and specifically the underlayment of the roofs really needed to be replaced because they had degraded and deteriorated. Respondent said they were paid only to re-roof the flat portions of the roofs, not the entire of the roofs. Respondent indicated upon inspection, missing roof tiles in the sloped (tiled) roof area were seen and that the roof underlayment was deteriorated or missing. Respondent testified they recommended to the Complainant that the sloped areas also be re-roofed.

Instead, the Complainant directed the Respondent to simply replace the missing tile. The tile was replaced as directed, but only after making clear to Complainant that the sloped portion of the roof was likely to leak and replacing the missing tile due to a deteriorated underlayment. Mr. Valenzuela testified the Complainant was warned by him that application of the surfacing materials Respondent was contracted to provide would only be a temporary remedy - that may extend the life of the existing roof - but would not make the roofs as good as new since the roofs really needed to be pulled off and replaced.

Respondent Valenzuela, who testified that he has been a union roofer for over 40 years, also testified that the particular construction of the roofs were unusual in that they were designed to quickly slope downwards toward the roofs’ flat centers, but the drains for those slopes were placed above a level that would catch water run-off. In other words, the drains’ placement when the buildings were originally constructed were poorly designed by the building architect or designer such that the drains do not capture water run off efficiently. He stated that in order to repair the problems of water ponding and water runoff, the services of carpenters and plumbers would be necessary and, such services are beyond the authority of Respondent’s license and are outside of the scope of Respondent’s employment on this project.

Moreover, Respondent Valenzuela testified, there is evidence pointed out in photographs of the building air conditioner where there appears to be hail damage to the exhaust vent that would allow water to seep into the building and also at the point where the air conditioner joins to the roof there is a gap sufficient to allow water seepage into the building. He also testified that the air conditioners have their own separate drainage systems and that the drainage systems have gaskets which, over time, will weather and degrade. These degraded gaskets cause the air conditioners to leak into the building interior and this mechanical malfunction is prevented by routine air conditioner maintenance. Such mechanical reasons for water leaks are not a responsibility of the Respondent, but rather, require the services of a trained and qualified air conditioner specialist, an area outside of the Respondent’s license qualification and outside the scope of work in this project.

It is Respondent’s opinion that water ponding occurs on the roofs because of a very poorly designed roof slope and roof drain placement design that will not allow for proper run off of water, neither of which are attributable to the Respondent’s workmanship, but instead are attributable to pre-existing design defects which are not the responsibility of the Respondent. The Respondent contends that water leakage is occurring not as a result of its workmanship, but instead, because the air conditioner design and installation and lack of air conditioner maintenance by the Complainant permits gaps that are unsealed [either through harsh weather conditions or heat] allowing for water to seep into the building interior. Respondent contends neither the building design defects nor the air conditioner condition/maintenance are the Respondent’s responsibility.

Respondent testified that on November 28, 2017, it went back to the Complainant’s roofs and completely resurfaced them knowing that whatever workmanship issues may have been presented were solved by applying yet another coat to the roofs.

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 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).

As to the issue of poor workmanship, the credible evidence presented at hearing established that at the time of the complaint there were items of Complainant’s project that Respondent needed to be completed or repaired. Specifically, leaks were substantiated around the roof hatch of building B, and around insulated refrigerant lines of a small A/C unit on building C and there were several areas of cracks, and several areas of roof fabric showing through the roof coating.

It is uncontested in the record that the reason for water ponding on the roofs resulted because of a very poorly designed roof slope and roof drain placement design that does not allow for proper run off of water, neither of which are attributable to the Respondent’s workmanship, but instead are attributable to pre-existing design defects which are not the responsibility of the Respondent.

Uncontested by the evidence presented, water leakage is occurring, by a preponderance of the evidence, not as a result of Respondent’s workmanship. Instead, water leakage is occurring because of the air conditioner’s design and installation and because of a lack of air conditioner maintenance by the Complainant which has permited gaps that are unsealed [either through harsh weather conditions or heat] allowing for water to seep into the building interior. The air conditioner’s condition/maintenance are not the Respondent’s responsibility nor are the leaks occasioned thereby a workmanship issue of the Respondent.

Complainant established, by a preponderance of the evidence, that Respondent did not perform the contracted work in a professional and workmanlike manner in violation of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3) as charged in the citation, charge 1 But. since it is found that the roof’s leaking and the ponding of roof water are not a result of poor workmanship, the actual workmanship issue narrows to minor defects consisting of “several areas of cracks, and several areas of roof fabric showing through the roof coating.

That on November 28, 2017, Respondent did return to the site and re-perform its job by completely resurfacing the roofs in question is a mitigating circumstance regarding Respondent’s violation of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3).

Although there is evidence that the Respondent was sent a letter by Inspector Smith regarding a possible violation of A.R.S. § 32-1158(A) [citation, charge 2], no evidence on this issue was presented and, by a preponderance, it was not established that the Respondent committed an A.R.S. § 32-1158(A) violation.

A contractor is subject to discipline if it fails to take appropriate corrective action without valid justification after receiving from ROC a written directive to take that corrective action. Ariz. Rev. Stat. § 32-1154(A)(22).

Since Respondent did not comply the directive until on November 28, 2017 by resurfacing the entire roofs, Respondent complied too late to meet the directive’s deadline for compliance of October 31, 2017. However, Respondent’s reapplication of the entire surface of the roof areas it contracted for far exceeded the requirements of the directive. Notwithstanding, by a preponderance of the evidence, Respondent violated A.R.S. § 32-1154(A)(22).

“At a hearing on an agency's imposition of fees or penalties or any agency compliance order, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(3). Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).

The Respondent is not unscrupulous, unqualified, or a financially irresponsible contractor.

Because Respondent has violated A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A) (3) and A.R.S. § 32-1154(A)(22), its license is subject to discipline. But, because Respondent’s workmanship violation is de minimus and compliance was accomplished approximately one week after the compliance inspection, the public policy behind the Registrar of Contractor’s statutory licensing authority to protect to protect the public from unscrupulous, unqualified, and financially irresponsible contractors is furthered by not disciplining the Respondent’s di minimus violation of good workmanship standards when there is a reasonably prompt and good faith effort at compliance with ROC directives as is shown by the evidence herein.

Because the Respondent has violated A.R.S. § 32-1154(A)(22), the Respondent may be penalized in accordance with A.R.S. § 32-1154(D).

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that the Registrar require Respondent to pay the sum of $250.00 as a civil penalty pursuant to A.R.S. § 32-1154(D).

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. Unless Respondent tenders payment of any outstanding prior civil penalty, 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), and the Registrar may discipline Respondent’s License.

FURTHER IT IS RECOMMENDED that if the Respondent does pay the entire amount of its civil penalty assessed herein on or before thirty days following the effective date of the Registrar’s final order, this Complaint should be dismissed and the case ordered closed.

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.

/s/ Randolph D. Wolfson

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

Done this day, March 2, 2018

/s/ Randy Wolfson

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors