ALJDEC decisions subject to certification as final
2017A-5938-CHC-ROC · Registrar of Contractors · 2018-05-02
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Larry Alfred Simpson,
COMPLAINANT,
v.
Intense Remodel LLC,
License No. CR61.306688-D,
RESPONDENT.
No. 2017A-5938-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: April 27, 2018, at 8:30 a.m.
APPEARANCES: Larry Alfred Simpson (“Complainant”) was represented by Brent Demmitt, Esq., Lipson Neilson, P.C., Intense Remodel LLC (“Respondent”) appeared through Shane Culbert, its qualifying party/manager.
ADMINISTRATIVE LAW JUDGE: Diane Mihalsky
_____________________________________________________________________
FINDINGS OF FACT
Background and Procedure
According to the Arizona Registrar of Contractors’ (“the Registrar’s” or “the ROC’s”) public website, on or about July 19, 2016, the Registrar issued License No. CR61.306688-D for dual carpentry, remodeling and repair to Respondent.
On or about November 28, 2017, Complainant filed a complaint with the Registrar against Respondent alleging that October 14, 2017, Respondent contracted to remodel Complainant’s house at 3118 E. Athena Ct., Gilbert, Arizona. Complainant alleged that Respondent had performed poor work on the project, including removing two shear walls, installing a flexible dryer exhaust with several turns inside the wall, failing to install greenboard behind sinks and toilet, and other potential code violations. The complaint stated that Respondent had promised “4 weeks to completion from start.” Complainant also stated that he had paid Respondent $35,720 of the $44,760 contract price.
Complainants submitted Respondent’s October 14, 2017 estimate for the job that set forth the scope of work, including the following: (1) Removing a living room wall on the first floor and building an entertainment center, including installing cultured stone, relocating electrical, and installing an electric fireplace; (2) Installing washer and dryer hookups in the master closet; (3) Framing walls in the loft to create a theater room; and (3) Installing a master bedroom and master bath on the second floor/loft, including plumbing and a shower pan. The estimate stated “4 weeks to completion from start.”
The Registrar assigned the complaint to its Investigator, Matt Gunstra, for investigation. Investigator Gunstra performed a jobsite inspection on December 18, 2017, which Respondent did not attend. On December 19, 2017, Investigator Gunstra issued a Directive to Respondent to remedy the following workmanship deficiencies:
NOTE: Upon issuance of permit Respondent shall schedule and comply with all required city inspections. This includes removal of drywall and opening concealed spaces as required.
Complaint Item 1: Two shear walls removed
Directive: Respondent shall comply with applicable code
Complaint Item 2: Tie downs were removed and cut bolts at concrete slab
Directive: Respondent shall comply with applicable code
Complaint Item 3: Cut studs without resupporting them
Directive: Respondent shall comply with applicable code
Complaint Item 4: No electrical outlets in newly constructed walls
Directive: Respondent shall comply with applicable code
Complaint Item 5: Installed flexible dryer vent with several turns inside wall
Directive: Respondent shall comply with applicable code
Complaint Item 6: Exhaust fans both inside shower and above toilet vents into attic and no GFI
Directive: Respondent shall comply with applicable code
Complaint Item 7: Exhaust fan above washer is not vented properly (drilled multiple holes in floor joists)
Directive: Respondent shall comply with applicable code
Complaint Item 16: Carpet not resecured after cutting away for new bathroom
Complaint Item 18: Pushed back insulation in attic-did not replace it
Complaint Item 19: Shower has concrete over wood
Directive: Respondent shall comply with applicable code for shower assemblies
Complaint Item 20: Bedroom ceiling HVAC vent is not sealed to the ceiling where notched and has a pencil mark on it.
The deadline for Respondent to correct the deficiencies was 5:00 p.m. on January 5, 2018.
On December 19, 2017, Investigator Gunstra also sent a letter to Respondent, informing him that it appeared that the project was unpermitted, in relevant part as follows:
The Registrar believes that necessary building permits were not obtained for a project located at:
3118 E Athena Ct, Gilbert AZ 85297
The International Residential Code and the International Building Code Chapter 1, Sections R105 and 105, state:
Any owner or authorized agent who intends to construct, enlarge, alter, repair, move, demolish or change the occupancy of a building or structure, or to erect, install, enlarge, alter, repair, remove, convert or replace any electrical, gas, mechanical or plumbing system, the installation of which is regulated by this code, or to cause any such work to be done, shall first make application to the building official and obtain the required permit.
Additionally, A.R.S. § 32-1154(A)(2) includes grounds for suspension or revocation of a contractor’s license:
Departure from or disregard of plans or specifications or any building codes of the state or any political subdivision of the state in any material respect that is prejudicial to another without consent of the owner or the owner’s duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code. (Emphasis added.)
A violation of A.R.S. § 32-1154(A)(2) would constitute grounds to suspend or revoke your license. Please review A.R.S. § 32-1154(A)(2), the International Residential Code, and the International Building Code to make sure you are complying with their requirements.
On January 24, 2018, Investigator Gunstra performed a compliance inspection, which Respondent did not attend. Investigator Gunstra’s report of his compliance inspection opined that Respondent had attempted to repair Complaint Items 6, 16, 18, and 20, but had only succeeded in performing repairs to Complaint Item 20, the HVAC vent in the bedroom ceiling, that met the Registrar’s workmanship standards. Investigator Gunstra noted that Respondent had not taken any action with respect to Complainant Items Nos. 1, 2, 3, 4, 5, 7, and 19. With respect to the remaining workmanship deficiencies, Investigator Gunstra reported the in relevant part as follows:
General Note: I have been advised that a building permit has not yet been obtained for this project. Complainant states they need engineering from the Respondent. Respondent stated at this inspection that he would provide it the next day. I advised both parties to resolve the problems that are delaying issue of permit and explained the next steps in the process and possible outcomes.
. . . .
Complaint Item 6: Exhaust fans both inside shower and above toilet vents into attic and no GFI
Directive: Respondent shall comply with applicable code
Compliance Findings: Respondent installed metal ducting for two fans that terminate at the exterior of the home. I observed that the metal gable vent is now damaged where this work was done. It was not in this condition prior to the repair and has not been corrected appropriately. In addition the sheathing at the duct penetration is damaged and the vent covers are not installed properly around it. This repair is not to standard.
. . . .
Complaint Item 16: Carpet not resecured after cutting away for new bathroom
Compliance Findings: Respondent installed tack strip at the carpet terminations in the bathroom. The carpet is not secured to the tack strip. I am unaware how the floor tile will be installed and if the carpet will need to be trimmed further but that is not Respondent’s responsibility. In the event that the tile can be installed where the carpet currently terminates the carpet should be secured to the tack strip by appropriate means. Item not corrected to standard.
Complaint Item 18: Pushed back insulation in attic-did not replace it
Compliance Findings: I entered the attic and observed that in at least one area the blown in insulation is still pulled back from the ceiling light box. Any insulation disturbed during the course of work should be reinstalled in the same or better condition it was in prior to the work. Item not corrected to standard.
After the compliance inspection, Investigator Gunstra referred the complaint to the Registrar’s Legal Department. On January 25, 2018, the Registrar issued a Citation against Respondent’s contractor’s license, charging cause to revoke or suspend the 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).
Respondent’s qualifying party/manager Mr. Culbert filed a timely written answer to the Citation, stating that it was not necessary to revoke or suspend Respondent’s license because he was working with Complainant to obtain a permit, including providing engineering studies for the work that Respondent had already performed.
The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. An evidentiary hearing was held on April 27, 2018. Complainant submitted six exhibits and presented the testimony of his wife, Barbara Simpson. Mr. Culbert submitted eleven exhibits and testified on Respondent’s behalf. Investigator Gunstra also testified.
Additional Hearing Evidence
Investigator Gunstra agreed that the thick natural-cut stone that Respondent had affixed to gypsum drywall was heavy. Investigator Gunstra testified that he contacted the manufacturer of the gypsum wall board, who deferred to the manufacturer of the natural-cut stone. Investigator Gunstra testified that the manufacturer of the natural-cut cultured stone did not respond to his inquiry. Investigator Gunstra testified that although manufacturers of similar stone do not recommend that their product be affixed to drywall, instead requiring a masonry surface, he did not require Respondent to correct the cultured stone that it had affixed to the drywall. Complainant did not submit any evidence that the manufacturer of the cultured stone did not recommend installing it on a gypsum wall board.
Investigator Gunstra testified that the Registrar requires licensed contractors to make sure that a permit is in place before they begin a project that requires a permit, even if the permit is the responsibility of the homeowner under the contract. Investigator Gunstra testified that if a contractor has performed work without a permit, the government permitting authority will either require the contractor to expose the work that needs to be inspected or require the contractor to provide a report from an engineer.
Investigator Gunstra testified that Mr. Culbert confirmed that Respondent had started the job without a permit. Investigator Gunstra testified that he encouraged Respondent to assist Complainant in getting a permit. Investigator Gunstra testified that at the time of the Directive, the Registrar’s policy was not to require the contractor to get a permit. After this complaint, the Registrar changed its policy to require contractors to obtain a permit if they had started a job that required a permit without one in place. Investigator Gunstra testified that the Registrar would defer to the governmental authority that issued the permit on whether specific items complied with code.
Mr. Culbert testified that under the parties’ original contract, Complainant and his wife were supposed to obtain the permit. Respondent’s estimate did not include any mention of or cost for a permit. As Inspector Gunstra’s December 19, 2017 letter noted, if the contract does not provide that the contractor is responsible for a permit, the building code provides that the owner shall obtain the permit.
Mr. Culbert testified that after Respondent finished framing, he told Complainant and his wife that they should obtain a permit from the Town of Gilbert and that a framing inspection by the town should be performed. Mr. Culbert testified that Complainant and his wife said that they were in a hurry and had no time for a permit or inspection because two families were waiting to move into the remodeled property.
Respondent submitted Investigator Gunstra’s January 9, 2017 email to the parties that provided in relevant part as follows:
This email is intended to clarify the role of the ROC in this matter regarding permit and what is required to obtain permit. To be clear, the ROC is not the authority that issues building permits or dictates what is required to obtain such permits. That would be the City. If the City requires drawings or engineering before they will issue a permit or before they will pass work that is up to them. Respondent is in violation of the ROC statute requiring permits be in place before work begins but that has nothing to do with his requirement to obtain said permits. Building code language states that the property owner is responsible. The ROC is not requiring Respondent to provide drawings for the overall project that may be needed for the city to issue a permit. The ROC is requiring the Respondent to obtain any required engineering pertaining to his modification of the structural walls and provide that. Beyond that the ROC is not the moderator of the permitting process. If a permit is not obtained [then] certain repairs cannot commence. If repairs [do] commence [then] all parties may present their case [at] hearing.
All, you need to figure this out and find a way to move forward.
On January 15, 2015, Complainant’s wife sent an email to Investigator Gunstra stating that she and Complainant had met with the Town of Gilbert’s inspector and that after looking over Complainant and his wife’s permit application, letter of intent, and drawing, the Town of Gilbert still needed a structural engineer’s recommendation. Complainant’s wife asked about Respondent’s deadline for getting the recommendation. On January 17, 2018, Investigator Gunstra responded in relevant part as follows:
I don’t have a deadline per se but am ok with giving time if it appears he is working to get it. If it goes past another week or so I may reassess that opinion.
Respondent submitted a signed and sealed opinion from registered engineer Christopher Barsby, P.E. of Tech Structural LLC dated February 9, 2018, with calculations that stated in relevant part as follows:
This letter is to confirm that it is structurally acceptable to make a 10 foot wide (max) opening in the 20 foot long 3/8 inch plywood sheathed shear wall separating the master bedroom from the family room. The shear capacity of the original wall was determined to be 365plf. And the modified shear resistance was determined to be 314plf with a net tension of zero at each end, negating the requirement for hold-downs. The opening should be strapped to continuous blocking for a minimum of 24 inches or two vertical fully blocked wall studs. A Simpson CS16 strap should be used and can be installed on either the bedroom or family room side of the wall. The identified plywood sheathing in the stairwell does not constitute a shear, but rather a measure of fire rating the stairwell. Structurally acceptable to modify per the field condition.
Mr. Culbert testified that the Town of Gilbert had a 14-day turnaround for engineering and plan review. Respondent also submitted supplemental calculations from Tech Structural LLC dated March 27, 2018, for beam bracing.
Mr. Culbert testified that after Respondent provided the engineering calculations and opinions, Complainant and his wife informed him that the Town of Gilbert still required architectural drawings to issue the permit. Mr. Culbert testified that even though the Registrar indicated that Respondent was not responsible for architectural plans, it obtained the plans that were required to obtain the permit. Respondent submitted undated sealed plans prepared by Mr. Barsby and Adobe Designs Architectural/Structural Drafting for the second floor of Complainant’s house and for the stairwell adjacent to the shear wall that Respondent modified to construct the entertainment center.
Respondent submitted a permit from the Town of Gilbert Development Services for the addition dated April 5, 2018. The applicant on the permit was Mr. Culbert. Mr. Culbert testified that although Complainant said that he would reimburse Respondent for the cost of the architectural drawings and permit, Complainant had not paid anything to Respondent.
Respondent also submitted an Inspection Worksheet for the project from Inspector Robert Edkins, Jr. of the Town of Gilbert for an inspection that occurred on April 10, 2018. Mr. Culbert testified that four of the items were Respondent’s responsibility, including three receptacles in the new bedroom, providing correct duct material for the dryer vent, installing “Connor be flex” through walls and ceiling, and exposing the area around the fireplace so that the town could inspect the shear and strapping to match engineering for cutting into the shear wall. Mr. Culbert testified that Complainant and his wife were responsible for the remaining three items, including completing a shower, installing a CO2 detector outside the bedroom, and completing the ductwork for the fan for the laundry room because they were preexisting conditions and not within the scope of Respondent’s work.
Mr. Culbert testified that because Complainants had gone out of town until shortly before the hearing, he had scheduled workers to make repairs that the Town of Gilbert required Respondent to make on May 1, 2018, two business days after the hearing. Respondent submitted texts from Complainant’s wife in which she agreed to allow Respondent to make the repairs that the Town of Gilbert’s building inspector required on Tuesday, May 1, 2018.
Investigator Gunstra testified that 128 days had passed since Complainant filed the complaint, which Investigator Gunstra believed was sufficient to obtain a permit. Investigator Gunstra acknowledged that the contractor cannot control the pace of a government agency’s permitting or inspection process.
Complainant at the hearing refused to provide any additional access to Respondent to perform repairs to pass the Town of Gilbert’s inspection and, instead, asked if he could hire another contractor to complete the project.
Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s disciplinary history as shown on the Registrar’s public website on this date. Respondent’s license is current and in good standing. No discipline has ever been taken against Respondent’s license.
CONCLUSIONS OF LAW
This matter lies within the Registrar’s jurisdiction.
Complainant bears the burden of proof to establish cause to discipline Respondent’s licenses 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.”
It appears that one of Complainant’s primary concerns when he hired Respondent was that the project should be completed quickly. Complainant was not concerned about a permit until he filed the workmanship complaint with the Registrar and realized that the lack of a permit might provide an advantage in prosecuting his complaint. Although Respondent did not finish the project in the estimated time, no statute provides that a contractor’s failure to complete a project by the estimated date furnishes grounds to revoke or suspend the license.
Although Respondent did not obtain a permit until three months after the deadline set forth in the Directive, the Directive only required Respondent to assist Complainant in obtaining the permit. It appears that Complainant and his wife did not make any concerted effort to obtain the permit but, instead, accepted the benefits of Respondent’s efforts to obtain a permit to avoid having its license suspended. Due to Respondent’s efforts, a permit eventually was obtained. Complainant therefore did not establish cause to revoke or suspend Respondent’s contractor’s license under A.R.S. § 32-1154(A)(2) solely because it worked on the project before a permit was obtained.
The Town of Gilbert’s April 10, 2018 Inspection Worksheet notes that Respondent’s work on the shear wall must be exposed before the Town of Gilbert can perform an inspection to see if the work complies with the engineer’s specifications. Since no inspection has been performed by the Town of Gilbert, as of this date, Complainant has not established that Complaint Item Nos. 1, 2, and 3 on the Directive violate the building code. Respondent was willing to perform expose its work and provided engineering calculations to allow the Town of Gilbert’s inspector to evaluate Respondent’s work. Complainants indicated that they not would allow Respondent to expose its work for the town’s inspection, however, after they agreed to a schedule, Therefore, Complainant has not established cause to revoke or suspend Respondent’s license under A.R.S. § 32-1154(A)(2) for failure to comply with code in constructing the shear wall at this time. If Complainant’s new contractor later discovers code violations in Respondent’s construction of the shear wall, Complainant may seek damages from Respondent for the code violations in a court of competent civil jurisdiction.
Complainant established that Respondent’s work departed from applicable code in the other three respects identified on the April 10, 2018 Inspection Worksheet, i.e., the absence of electrical outlets on the newly constructed walls (Item No. 4 on the Directive), the flexible dryer vent (Item No. 5 on the Directive), and “Connor be flex” through the walls and ceiling (the Administrative Law Judge has not been able to locate this item on Complainant’s complaint or the Directive). Therefore, Complainant has established that cause to revoke or suspend Respondent’s contractor’s license under A.R.S. § 32-1154(A)(2) for the two of the three items that the City of Gilbert’s inspector found did not comply with the code.
Complainant established that Respondent’s workmanship did not comply with the Registrar’s or industry standards in the three respects identified on Investigator Gunstra’s Compliance Jobsite Inspection Notes, or Item Nos. 6, 16, and 18 of the Directive. Complainant has therefore established cause to discipline Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108.
Construction is not a perfect art and, generally, contractors must be afforded an opportunity to correct their workmanship before their licenses may be suspended or revoked. Respondent was allowed to attempt to repair at least four items that did not require a permit, yet failed to repair three of those items to comply with the Registrar’s workmanship standards. Therefore, Complainant established cause to discipline Respondent’s contractor’s license under A.R.S. § 32-1154(A)(22).
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RECOMMENDED ORDER
Based on the foregoing, it is recommended that on the effective date of the final order in this matter, License No. CR61.306688-D of Respondent Intense Remodel LLC shall be suspended for a period of three (3) calendar days.
It is further recommended that the Registrar require Respondent to 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 Registrar’s 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.
Done this day, May 2, 2018.
/s/ Diane Mihalsky
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors