FINACT2018A-04224-CHC-ROC.pdf

2018A-04224-ROC · Registrar of Contractors · 2019-07-01

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA Gregory T Sackos, Case No. 2018-04224 COMPLAINANT, Docket No. 2018A-04224-CHC-ROC v. Builders Investment Group LLC, FINAL ADMINISTRATIVE DECISION License No. ROC 306835, AND ORDER RESPONDENT. Under A.R.S. § 41-1092.08(B), the Registrar may review and accept, modify, or reject an administrative law judge’s written decision. If the Registrar modifies or rejects that decision, then the Registrar must provide written justification setting forth the reasons for the modification or rejection. REGISTRAR’S ACCEPTANCE In this case, a hearing was held, and the administrative law judge issued a written decision. See Administrative Law Judge Decision, attached. The Registrar reviewed that decision and hereby accepts it. CONCLUSION Because the Registrar has accepted the administrative law judge’s decision, that decision is the final administrative decision in this case and becomes effective on July 31, 2019. FINAL NOTE On page 7, line 5, replace “close” with “close as dismissed.”

Dated June 21, 2019.

Registrar of Contractors /s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal and Recovery Fund

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 Copy mailed via USPS First Class mail June 21, 2019 to: Respondent Builders Investment Group LLC 15333 N Pima Rd Ste 305 Scottsdale, AZ 85260 Tabitha Myers, Esq. 8925 E Pima Center Pkwy Ste 100 Scottsdale, AZ 85258-4409 Complainant Gregory T Sackos 6634 East Doubletree Ranch Road Paradise Valley, AZ 85253 Aaron T. Lloyd Esq. 2375 E. Camelback Rd. Ste. 700 Phoenix, AZ 85016 AND copy electronically mailed this same date to: Respondent at email address on record with the Registrar Complainant at email address on record with the Registrar

Office of Administrative Hearings Tammy L. Eigenheer, Administrative Law Judge Case No. 2018-04224 / DE

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 RECEIVED 6.13.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Gregory T. Sackos, No. 2018A-04224-ROC COMPLAINANT v. ADMINISTRATIVE LAW JUDGE Builders Investment Group LLC, DECISION ROC License: ROC 306835 RESPONDENT HEARING: May 14, 2019, with the record held open until May 23, 2019 APPEARANCES: Complainant Gregory T. Sackos appeared and was

represented by Aaron T. Lloyd. Gregory Coe, Owner, appeared on behalf of

Respondent Builders Investment Group, LLC, which was represented by Tabitha R.

Myers.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

1. Builders Investment Group LLC (Respondent) is the holder of License No.

306835 issued by the Arizona Registrar of Contractors (Registrar).

2. On or about April 5, 2018, Gregory T. Sackos (Complainant) signed a contract with Respondent for the building of an addition on his home for the total cost of $134,000.00. 3. On or about September 20, 2018, the Registrar received a Complaint against Respondent from Complainant alleging abandonment with respect to the project. 4. The Registrar assigned the complaint to Investigator Randall Morris. After a jobsite inspection, Investigator Morris 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

Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 6.13.2019 ROC LEGAL

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 January 31, 2019. NOTE: the date for compliance with the directive has been extended due to the extensive nature of the repairs required by the directive. You are hereby directed to remedy the following violations by the appropriate means: Complaint Item 2: “Contractor did not utilize 6 mil vapor barrier under slap as per plans” (Complaint is referring to the concrete slab). During the job site inspection, the Respondent stated that no vapor barrier was installed and base was inspected and approved by the City of Paradise Valley prior to pour of the concrete slab. Additionally, documentation provided by the Respondent states that no vapor barrier has been installed. Verified that the approved plans require the installation of a 6 mil barrier over the aggregate base and under the concrete floor slab see photo P4. Allegation is substantiated. Complaint Item 4: “Concern regarding the forming of major structural footing (F1 in plans)”. Verified the location of the subject structural footing (beam) based on the approved plans and verified that the core sample was taken within the subject area where the structural footing should have been. The core sample hole exposed that the concrete did not meet the requirements for the depth of the structural footing within the specified location. Allegation is verified. Complaint Item 7: “Contractor will not provide owner/architect with information on concrete mixture”. Complainant is referring to the specification requiring the addition of macro fibers to the concrete mix. Documentation provided by the Respondent states that macro fiber was not added the concrete mix prior to the pour. Additionally, the Respondent stated that macro fiber was not added at the time of the original job site inspection. The allegation was verified.

The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action. 5. Following the issuance of the initial written directive, the Registrar granted Respondent an extension due to the nature of the work to be corrected. Respondent did not complete the corrective work prior to the extended deadline.

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6. The Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(2); A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108; A.R.S. § 32-1154(A)(9); and A.R.S. § 32-1154(A)(22).

7. Investigator Morris testified as to the Registrar’s involvement in this

matter. Specifically, Investigator Morris noted that, during the course of his

investigation, he determined that Respondent had employed Saul Sanchez as a

subcontractor, but Mr. Sanchez was not licensed by the Registrar.

8. Chuck Ransom, Town of Paradise Valley Inspector, testified that the

applicable building codes require a vapor barrier “as needed,” but it is left to the

discretion of the building official to determine if it was needed. Mr. Ransom noted that

due to the pipes of the existing home, the footing at issue had to go in the same area of

the pipe. Mr. Ransom also stated that the project passed the footing inspection on May

30, 2018. Mr. Ransom indicated that the Town of Paradise Valley did not inspect for

macro fiber in the concrete. Mr. Ransom stated that Respondent’s work on the project

met the minimum code standards of the Town of Paradise Valley. No evidence was

presented to establish that the building official determined a vapor barrier was needed

on the project. 9. Complainant testified that he wanted to have a strong, structurally designed home, so he hired an architect to design the addition and relied on the architect’s expertise. Complainant did not know if the existing home had macro fiber in the concrete or a vapor barrier. Complainant admitted that he did not specifically request the macro fiber or vapor barrier. Complainant stated that he expected the plans would be followed as written. 10. Gwendolyn Butler, architect, testified that the structural engineer she worked with on the project decided that macro fiber should be used in the concrete because he typically recommends that on all jobs. Ms. Butler also stated that she included vapor barriers on all plans because the IBC required vapor barriers. Ms. Butler noted that the adhesive used for the tile flooring in the bonus room and laundry could have issues with moisture coming up through the concrete. RECEIVED 6.13.2019 ROC LEGAL

11. James Allan Lane, structural engineer, testified that the vapor barrier was a building code requirement. Mr. Lane also stated that macro fiber in the concrete replaced welded wire fabric, improved the strength of the concrete, and reduced

cracking. Mr. Lane acknowledged that a building official may approve a deviation from

a building code requirement. Mr. Lane disagreed with the findings of a report from

Gervasio & Assoc., Inc. as to the adequacy of the footing.

12. Jack Gordon, structural engineer with Gervasio & Assoc., Inc., testified as

to his inspection of the project. As to the depth of the footings, Mr. Gordon testified that

the instruments he used to measure the thickness of the concrete were unable to

differentiate between a pipe in the middle of the concrete footing and the bottom of the

footing, so the readings were between three inches and eleven inches. Regardless,

Mr. Gordon took 30 readings of the thickness of the concrete for the footing. With the

readings, Mr. Gordon calculated the size and depth of the footing provided adequate

load bearing capabilities for the structure. As to the macro fiber in the concrete, Mr.

Gordon testified that all concrete cracks, and the purpose of the macro fiber was to

prevent large cracks from developing. Mr. Gordon stated the use of macro fiber was

not common in Arizona. Mr. Gordon noted that he did observe small unrepaired cracks in the concrete that were between .02 and .09 inches wide, which is less than the Registrar’s allowed size of cracks in concrete per its standards. Mr. Gordon did recommend that the cracks be sealed and properly treated before the tile flooring was installed to reduce the likelihood that they would telegraph through to the tile. As to the vapor barrier, Mr. Gordon reported that the omission of the vapor barrier “likely will not adversely affect[ ] the serviceability of the floor slabs.” Mr. Gordon opined that the existing home probably did not have a vapor barrier as the use of vapor barrier was not common at the time the home was built. 13. Gregory Coe, Owner, testified that he did not knowingly hire an unlicensed contractor. Mr. Coe had previously worked with Mr. Sanchez on another project. When Mr. Coe contacted Mr. Sanchez for the instant project, he assumed Mr. Sanchez was working through his employer, a licensed contractor. Mr. Coe talked to Mr. Sanchez after the complaint was filed, at which time Mr. Sanchez acknowledged RECEIVED 6.13.2019 ROC LEGAL

that he had not told his boss about the job and that he was working outside of his employment. Mr. Coe acknowledged having received and reviewed the plans on the project, but relied on the subcontractor to complete the concrete work as set forth in the

plans. Mr. Coe testified that Respondent had payment issues with Complainant and

issued a stop work order until the issue was resolved. Mr. Coe stated that he had

never heard about the vapor barrier, macro fiber, or footing issues until after the stop

work notice. Mr. Coe offered a credit back to Complainant for the vapor barrier and

macro fiber. Mr. Coe stated that Complainant had called the police when Respondent

was attempting to comply with the written directive.

14. Administrative notice is taken of Respondent’s prior License record on

June 12, 2019. Such prior License record reflects that Respondent’s License No.

306835 was first issued on September 19, 2016, 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

1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. 2. 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). 3. The uncontroverted evidence established that Respondent deviated from the plans by not installing a vapor barrier and not using macro fiber in the concrete. However, Complainant failed to establish that the deviations were either material or prejudicial to Complainant. The evidence was inconclusive as to whether Respondent deviated from the plans with respect to the footing given the pipe running through that

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area and that the footing passed the inspection by the Town of Paradise Valley. Accordingly, Complainant failed to establish a violation of A.R.S. § 32-1154(A)(2).1 4. The noted cracks in the concrete were all smaller than the standard set

forth by the Registrar. The evidence failed to establish that Respondent’s work was not

in conformity with the Registrar’s standards. Therefore, Complainant failed to establish

that Respondent did not complete the project in a workmanlike manner in violation of

A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108.2

5. The evidence established that Respondent hired Mr. Sanchez, who was

not a licensed contractor, to perform work on the project. Mr. Coe was credible in his

testimony that he believed he was hiring Mr. Sanchez’s employer that Respondent had

previously contracted with. The applicable statute does not require that the licensee

knowingly or intentionally aid and abet the practice of unlicensed contracting, however,

such a requirement may be inferred. Therefore, Complainant failed to establish a

violation of A.R.S. § 32-1154(A)(9).3

6. The evidence established that Respondent did not attempt to compete the

corrective work following the Directive being issued. However, given the findings supra

that the deviation from plans was not a violation of the statute and that the work was performed in a workmanlike manner, Respondent was not required to correct any issues on the project. Therefore, Complainant failed to establish that Respondent

A.R.S. § 32-1154(A)(2) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[d]eparture 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.” 2 A.R.S. § 32-1154(A)(3) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[v]iolation of any rule adopted by the registrar.” A.A.C. R4-9-108 requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.” A.R.S. § 32-1154(A)(9) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]iding or abetting a licensed or unlicensed person to evade this chapter, knowingly or recklessly combining or conspiring with a licensed or unlicensed person, allowing one's license to be used by a licensed or unlicensed person or acting as agent, partner, associate or otherwise of a licensed or unlicensed person with intent to evade this chapter.” RECEIVED 6.13.2019 ROC LEGAL

failed to take appropriate corrective action following a written directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).4

RECOMMENDED ORDER

It is recommended that on the effective date of the Registrar’s final order in this

matter, the Registrar close Complainant Gregory T. Sackos’ complaint in Case No.

2018-04224 against Respondent Builders Investment Group LLC,’s License No.

306835.

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, June 12, 2019.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors

A.R.S. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure 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.”