ALJDEC decisions subject to certification as final

2017A-676-CHC-ROC · Registrar of Contractors · 2017-08-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Park Centre Casitas HOA,

COMPLAINANT,

v.

Dan Keen Services Inc.,

License Nos. KB-2.149714-D, B-1.216068-C, and CR37.271270-D,

RESPONDENT.

No. 2017A-676-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 17, 2017, at 8:30 a.m.

APPEARANCES: Park Centre Casitas HOA (“Complainant”) appeared through Steve Edwards, its president; Dan Keen Services Inc. was represented by D. Jeffrey Craven, Esq., The Craven Firm PLLC.

ADMINISTRATIVE LAW JUDGE: Diane Mihalsky

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

On or about October 22, 1999, the Arizona Registrar of Contractors (“the Registrar”) issued License No. KB-2.149714-D for dual residential and small commercial contracting to Respondent. On or about January 29, 2006, the Registrar issued License No. B-1.216068-C for commercial general contracting to Respondent. On or about February 21, 2011, the Registrar issued License No. B-1.216068-C for dual plumbing to Respondent. License Nos. B-1.216068-C and B-1.216068-C are currently inactive.

On or about February 3, 2017, Complainant’s president, Steve Edwards, on its behalf filed a complaint with the Registrar against Respondent alleging that Respondent had failed to follow the project specifications when it reinstalled the roof over one of Complainant’s buildings at 1001 N. Pasadena Building #3. Complainant attached a 17-page scope of work to the complaint, which did not identify who had drafted the document, as well as a 5-page proposal that Respondent had drafted that provided an estimate to install a pitched tile roof on Buildings A and B “as per scope of work provided by Henry Staggs of Preferred Roof Consultants of Arizona.” The complaint did not allege that Respondent had improperly installed the underlayment under the roof tiles.

The Registrar assigned the complaint to its Investigator, Mike Crow, for investigation. Investigator Crow performed a jobsite inspection on March 2, 2017. Inspector Crow’s Jobsite Inspection Notes for the March 2, 2017 inspection noted that Complainant had hired Henry Staggs as a consultant to assist Complainant by assembling the scope of work, overseeing Respondent’s work on the project, and assembling the complaint that Complainant filed with the Registrar.

According to the Registrar’s public website, on May 25, 2017, the Registrar issued License No. CR42.313864-D for dual roofing to Preferred Roofing Consultants of Arizona LLC. On January 29, 2012, the Registrar previously issued License No. CR42.276624-D for dual roofing the Rooffix, LLC. Henry Staggs is the qualifying party/member on both licenses. On May 25, 2017, Rooffix LLC’s license was cancelled.

On March 24, 2017, Investigator Crow issued a directive to Respondent to repair nine of the sixteen items on Complainant’s complaint on or before 5:00 p.m. on April 10, 2017, in relevant part as follows:

Nailing

The North side of the building, the tile has not been nailed. This issue was addressed in the "nonperformance notice", and the Contractor did agree to correct, but failed to do so. On a subsequent visit the Consultant found more tile that has not been nailed. All the slopes will need to be walked and inspected for un-nailed tile and corrected as needed.

Respondent shall correct by appropriate means.

Ridge

The Contractor was instructed via phone, text, email and in the "nonperformance notice", to remove the existing ridge board and replace it with a new 2x6 board. The Contractor did agree to correct this and has failed to do so.

Respondent shall correct by appropriate means.

Figarol

The figarol is not properly installed in accordance with the manufacturer's instructions. The Contractor was given notice to correct this issue, but failed to do so. The figarol will not vent as designed, as it is currently installed.

Respondent shall correct by appropriate means.

Penetration flashing

The Contractor was made aware that he had installed the malleable flashing incorrectly. The Contractor agreed to correct this issue, and did not correct the issue. As the flashing are currently installed there is a serious potential for leaks over time.

Respondent shall correct by appropriate means.

Ridge Tile

The ridge tile is not secured to the ridge board. Since there is no ridge board to secure it to. Each ridge tile is to be nailed and sealed according to code. As the ridge is constructed now, there is high probability that in the right conditions the trim tile can be blown off, causing subsequent damages and potential leaking.

Respondent shall correct by appropriate means.

Rakes

There are several rakes that do not have any trim tile installed at all. The base sheet, fasteners, and batons are exposed.

Respondent shall correct by appropriate means.

Pans and kick out flashing

The Contractor did not install the ribbed pan flashing at the walls as specified, instead installed black wakaflex on the wall and the tile, The Consultant specifically told to the contractor not to do this and gave the Contractor specific instructions as to the installation of the pan flashing and kick out flashing.

Respondent shall correct by appropriate means.

Wakaflex

The wakaflex was installed on dirty tile, and will never properly seal. Were installed as per spec the contractor did not paint the wakaflex to match or install a te1mination bar. The Contractor showed the consultant wakaflex that was terracotta in color to match the tile. However, the wakaflex that was installed is black, not terracotta.

Respondent shall correct by appropriate means.

Head Wall

The head walls are incorrectly flashed.

Respondent shall correct by appropriate means.

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

On May 3, 2017, the Registrar issued a Citation against Respondent’s license, charging cause to revoke or suspend the license under 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/president Daniel E. Keen on its behalf filed a timely written answer to the Citation, stating that its work complied with the Registrar’s workmanship standards and that it made all the corrections required by the March 24, 2017 Directive. Mr. Keen made the following additional affirmative allegations:

Complainant retained a licensed roofing contractor to act as its agent for this project. That contractor has interfered with Respondent’s ability to complete work, has directed the course and scope of the work by Respondent and given inconsistent and changing instructions, has altered Respondent’s work, and upon information and belief, has actively and willfully engaged in sabotaging that work. Thus, Complainant, through its agent, has made completion of the work and compliance with the Registrar’s directive an impossibility. Further, as Complainant’s contractor-agent has altered Respondent’s work, such contractor should be responsible for the work and for any maintenance or warranty, and Respondent should be relieved of further obligation to complete the work or to comply with the Registrar’s written directive.

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 August 17, 2017. Mr. Edwards submitted three exhibits and testified on Complainant’s behalf. Respondent submitted two exhibits and presented the testimony of two witnesses: (1) Esmar Arango, who performed work on the project, and Matthew Santistevan, a consultant for Boral, which manufactured the materials that Respondent used to install a new roof at the project. Investigator Crow also testified. Mr. Staggs did not testify.

Hearing Evidence

Complainant’s members are the 192 owners of condominiums in the Park Centre Casitas. Seven units are in the building where Respondent replaced or repaired the tile roof.

Mr. Edwards pointed out that Mr. Keen had signed the specifications that Mr. Staggs had prepared to indicate that he was willing to be bound by such specifications. Mr. Edwards testified that he was dismayed that Mr. Staggs had reported that Respondent did not live up to the job specifications.

Investigator Crow testified that Mr. Staggs was listed as one of Complainant’s representatives on the complaint. Investigator Crow testified that Respondent’s work was incomplete at the March 2, 2017 jobsite inspection. Because it is not the policy of the Registrar’s investigators to walk on tile roofs to avoid any liability for damage to tiles or personal injury, he asked Mr. Staggs or Mr. Edwards to provide a ladder so that he could access the roof.

Investigator Crow testified that on March 9, 2017, Mr. Edwards asked if he could get another contractor to perform the work because Complainant did not agree to Respondent’s price. Investigator Crow testified that he told Mr. Edwards that the Registrar does not get involved in money disputes and that if Complainant hired another contractor, the Registrar might not be able to issue a directive.

On March 29, 2017, Investigator Crow sent an email to the parties and to Mr. Staggs, stating that the requirement that Respondent correct by appropriate means the items on the March 24, 2017 directive meant that it was up to Respondent to determine what means were appropriate, not Mr. Staggs or anyone else. Investigator Crow also pointed out that the underlayment was not included on the complaint, but that Complainant could amend the complaint to allege it. Investigator Crow testified that Complainant never amended the complaint.

Investigator Crow testified that Complainant initially requested that the deadline for compliance with the March 24, 2017 directive be expedited. On April 4, 2017, he received a voicemail from Respondent asking for clarification on the Wakaflex. Investigator Crow testified that after he read his jobsite inspection notes to Mr. Keen, he indicated that he knew what to do. Mr. Keen later said that Respondent had complied with the Directive, but on April 11, 2017, Complainant sent an email to Investigator Crow stating that Respondent had not complied, but that its crew was still working on the project.

Investigator Crow testified that the parties agreed to extend the April 10, 2017 deadline on the March 24, 2017 directive several times, with the latest extension being to April 26, 2017.

Investigator Crow testified that Respondent informed him that it had completed all repairs and that the manufacturer’s representative stated that all materials had been installed correctly.

Investigator Crow testified that on April 27, 2017, he performed a compliance jobsite inspection and that he determined that Respondent had not completed all the repairs required by the March 24, 2017 directive.

Investigator Crow testified that on May 1, 2017, he received additional documents from Mr. Staggs, who continued to send Investigator Crow copies of additional reports about how Respondent was failing to comply with contract specifications or workmanship standards. Investigator Crow testified that he referred the matter to the Registrar’s Legal Department with a request for a Citation.

Investigator Crow testified that on May 9, 2017, Mr. Edwards said that Respondent was still working on the project and asked if he could ask Respondent to leave the job. Investigator Crow testified that he told Mr. Edwards that the matter had been referred to the Registrar’s Legal Department and that he did not have to allow Respondent to work on the job.

Investigator Crow testified that on May 15, 2017, Mr. Edwards said that tile had fallen off the roof. Investigator Crow testified that according to his notes, Mr. Staggs had already removed tile from the roof to expose the underlayment.

Investigator Crow testified that on May 11, 2017, the Legal Department received photographs from Respondent that purportedly showed compliance with the directive and additional documentation from Mr. Edwards and Mr. Staggs that it did not. The Legal Department requested that he perform a second compliance inspection.

Inspector Crow testified that on May 17, 2017, he determined that Respondent had not complied with two items on the March 24, 2017 directive: (1) No. 4 on the directive, the penetration pipe flashing, and (2) No. 7 on the directive, the pans and kick out flashing.

Investigator Crow testified that he performed the second compliance inspection on May 23, 2017, and that there was discussion back and forth between Mr. Staggs and Respondent in emails and at the inspection. Respondent stated that its work had been modified by Mr. Staggs. Mr. Staggs stated that he had removed the roof tiles to expose the underlayment and to see whether Respondent had complied with the contract specifications.

Investigator Crow testified that he received an email from Complainant’s consultant, Mr. Staggs, stating that Respondent had not complied with the directive, the relationship with Respondent had deteriorated, and that Mr. Staggs feared for his safety.

Investigator Crow testified that at the May 23, 2017 second compliance inspection, he saw that Respondent had corrected item 4 on the directive, the malleable penetration flashing. Investigator Crow testified that because Mr. Staggs had removed roof tiles, the condition of the roof was different than at the April 17, 2017 compliance inspection. Investigator Crow testified that there was roofing material spread out all over the roof and that he could not render any opinion about the other alleged deficiencies. Investigator Crow testified that it is not a good idea to remove a contractor’s work before a jobsite inspection. Investigator Crow testified that he referred the matter back to the Registrar’s Legal Department.

Investigator Crow testified that he performed a prehearing jobsite inspection on August 15, 2017. The conditions at the jobsite were the same as at the May 23, 2017 second compliance jobsite inspection. He was unable to determine whether Respondent had complied with the directive due to Mr. Staggs’ removal of the roofing materials it had installed.

Investigator Crow acknowledged that the Registrar generally requires contractors to comply with contract specifications and that he did not recommend that the Citation charge cause to suspend or revoke Respondent’s license under A.R.S. § 32-1154(A)(2) for failing to comply with the specifications that Mr. Staggs had written, with which Respondent agreed to comply. Investigator Crow testified that there was no evidence that Respondent had failed to comply with specifications because at the time of the initial jobsite inspection, the job was incomplete. Investigator Crow testified that the specifications that Mr. Staggs had written were inconsistent because they referred to rib flashing, pan flashing, and the manufacturer’s specifications. Because the specifications were ambiguous, he considered the manufacturer’s and the Tile Roof Institute’s (“TRI’s”) specifications and guidance documents.

Investigator Crow acknowledged that Mr. Staggs had provided detailed information about differences between J-pan flashing and rib flashing. Investigator Crow testified if there are conflicts in the manufacturer’s specifications, the Registrar refers to its minimum workmanship standards.

Investigator Crow testified that he could not tell whether Respondent had completed item no. 7 on the directive because Mr. Staggs had removed its work. Investigator Crow testified that at the second and third jobsite inspections, he did not revisit the complaint items. Investigator Crow testified that at the prehearing inspection, he saw Complainant’s contractor or employee Johnny Duran adjusting tiles on the roof.

Investigator Crow testified that batten extensions were not installed over the entire roof, but the TRI’s specifications stated that batten extensions were optional.

Mr. Arango testified that Respondent had nailed the tiles to the roof, had installed batten extensions, and figarols according to the TRI’s standards. In areas where batten extensions were not installed, they were not required.

Mr. Santistevan testified that he inspected Respondent’s installation of the Wakaflex, figarols, and flashing and that Respondent had complied with the manufacturer’s specifications with respect to these items.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainant bears the burden of proof to establish cause to discipline 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 that Respondent’s workmanship did not comply with TRI’s and/or the Registrar’s standards in the nine specific deficiencies noted in the March 24, 2017 directive, thereby potentially providing 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 as they see fit before their licenses may be suspended or revoked. By virtue of having a contractor’s license in good standing, a licensed contractor like Respondent is presumed to have the expertise to perform appropriate repairs. If its repairs are not appropriate, as Investigator Crow informed Mr. Staggs and Complainant, the property owner’s remedy is to request a compliance hearing. The property owner does not have a right to dictate the method of repair and subsequent changes by others to the contractor’s work to expose alleged deficiencies will prevent the property owner from receiving any relief in this administrative forum under A.R.S. § 32-1155(C).

Respondent established that it complied all items of the directive, except item no. 7, and that Mr. Staggs or others altered its work, thereby precluding any finding that could have established cause to discipline Respondent’s contractor’s licenses under A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the final order in this matter, Complainant Park Centre Casitas HOA’s complaint in Case No. 2017-676 against Respondent Dan Keen Services Inc. License Nos. KB-2.149714-D, B-1.216068-C, and CR37.271270-D shall be dismissed.

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, August 29, 2017.

/s/ Diane Mihalsky

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors