ALJDEC decisions subject to certification as final

2018A-05503-CHC-ROC · Registrar of Contractors · 2019-08-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 31, 2019 APPEARANCES: Alfred Charles Bisogno on his own behalf; Kevin Scott Stevens for Respondent ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT 1. On June 11, 2019, the Registrar of Contractors (“ROC”) issued a Notice of Hearing setting the above-captioned matter for hearing on July 31, 2019 at the Office of Administrative Hearing. 2. The Notice of Hearing shows that the hearing was set to consider the charges made in the Citation and complaint. 3. Respondent DBR Construction LLC holds license Nos. 292690 and 307428 issued by ROC. Kevin Scott Stevens is Respondent’s qualifying party and a member of the LLC. 4. Respondent conducted work remodeling and adding an addition to Complainant Alfred Charles Bisogno’s house. 5. Mr. Bisogno filed with ROC a complaint against Respondent alleging a number of workmanship deficiencies. Mr. Bisogno also filed an addendum to that complaint. 6. ROC investigator Lisa Melton conducted a jobsite inspection on January 2, 2019 and a second jobsite inspection on March 7, 2019. 7. On April 18, 2019, ROC issued to Respondent a Directive that provided in part: You are hereby directed to remedy the following violations by the appropriate means: Complaint Item 1: contracted for 5 ton a/c received 4 ton Governing Rule: ARS §32-1154 (A) (3), Poor work not performed in accordance with professional industry standards. Complaint Item 8: patio roof lots of leaks Governing Rule: ARS §32-1154 (A) (3), Poor work not performed in accordance with professional industry standards. Complaint Item 18: did not skim coat existing stucco to match new as in contract (I can explain) Governing Rule: ARS §32-1154 (A) (3), Poor work not performed in accordance with professional industry standards. Complaint Item 20: New bathroom shower door opens and hits toilet. This shower is mainly used for guest, children and grandchildren when using swimming pool. If glass door were to break it could seriously injure or cause death. Governing Rule: ARS §32-1154 (A) (3), Poor work not performed in accordance with professional industry standards. Complaint Item 21: Sheetrock over living room sliding glass door needs repair from water leaks. Investigator’s Observation: Damaged sheetrock is apparent. (See JSI Photo #9) Governing Rule: ARS §32-1154 (A) (3), Poor work not performed in accordance with professional industry standards. The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action.

8. The Directive shows that ROC had determined that any other workmanship violations alleged in Mr. Bisogno’s complaint were unsubstantiated. 9. Among the complaint items that ROC did not verify was item 2, in which Mr. Bisogno alleged that he had contracted for elastomeric paint, but received a cheaper alternative. 10. The Directive required Respondent to provide ROC with written proof that it had made the required corrections by no later than 5:00 p.m. May 7, 2019. 11. ROC issued to Respondent a Citation dated May 15, 2019. Through that Citation ROC alleges that Respondent may have violated Ariz. Rev. Stat. sections 32-1154(A)(3) and (A)(22). 12. At the hearing, evidence was presented on complaint items 1 and 18, and Mr. Bisogno testified as to his opinion that he should have received elastomeric paint. 13. Mr. Bisogno presented no credible evidence to show that the parties’ contract called for the house to be painted using elastomeric paint. 14. Exhibit R7 is the parties’ Construction Agreement dated March 19, 2016. Exhibit R1 is a six page scope of work with progress payment information that is also dated March 19, 2016. Exhibit R15 is a set of plans and specifications for the project. 15. Mr. Stevens acknowledged that the air conditioners installed and the stucco work did not comply with the information in the scope of work. But he testified to the effect that based on the parties’ contract, Respondent had the authority to make the changes it made. 16. Mr. Stevens referred to the Construction Agreement at paragraph that shows that Respondent/Builder was to furnish labor and materials for the project as described in the plans and specifications, but the builder “may substitute materials that are equal in quality to those in the plans and specifications if the builder deems it advisable to do so. All dimensions and designations on the plans and specifications are subject to adjustment as required by job conditions.” 17. Mr. Stevens explained that flexibility is required in a remodeling/room addition project such as this one, because things often do not match the plans. 18. Prior to ROC issuing the Directive in this matter, Ms. Melton was aware that Respondent’s position was that the parties’ contract allowed it to make the changes that it made to the scope of work. She testified initially to the effect that she did not believe she was competent to interpret the contract and that it would instead be appropriate to set the matter for a hearing regarding that issue. However, she later testified as to her opinion that even if the contract allowed Respondent to make the changes that it made and even if the air conditioners that were installed were the proper size based on Manual J calculations, Respondent nevertheless committed workmanship violations because it did not properly communicate with Mr. Bisogno. 19. Under “A/C System,” the scope of work calls for the installation of 1 new 5-ton and 1 new 3-ton Armstrong air 14 seer heat pump units. 20. Mr. Stevens acknowledged that Respondent had substituted a 4-ton air conditioner for the 5-ton unit and that it had substituted a 3.5-ton unit for the 3-ton unit. 21. When Respondent started the project, it received information from Miller Mechanical showing that 8 tons total were required to cover the existing building and the proposed addition, which is why the scope of work called for the 5-ton and 3-ton units. 22. After the new duct locations and room configurations were in place, Respondent saw that the proposed 3-ton unit would not cover its designated area and Respondent increased that unit to 3.5 tons. At the same time, Respondent saw that the proposed 5- ton unit for the other part of the house would be oversized, so it decreased that unit to 4 tons. In addition, Respondent upgraded the units from 14 seer (as set out in the scope of work) to 16 seer. The units Respondent installed are two-stage with added heat strips, which are considered to be upgrades. 23. Mr. Bisogno testified that he had paid for a 5-ton unit that he did not receive and to the effect that Respondent should have used his existing 4-ton unit rather than replacing that unit with a new 4-ton unit. 24. Respondent presented credible evidence that it would not have been appropriate to “mix” the new 3.5-ton unit with the existing/old 4-ton 10 seer unit, because this would result in the units burning out too fast. 25. Maricopa County does not require Manual J calculations and none were completed while the work was in progress. After ROC got involved, Respondent offered to provide Ms. Melton with such calculations. Exhibit R2 are Manual J calculations sealed by an Arizona Registered mechanical engineer showing that the proper sizes for the air conditioners were 3.93 and 3.39 tons. As such the installation of the 4-ton and 3.5-ton units was proven to be appropriate. 26. Air conditioners should not be either oversized or undersized and it would not be appropriate to install a 5-ton unit when only 4 tons was required. 27. Mr. Bisogno had entered into evidence a proposal from Jaycox Home Air Conditioning and Heating showing that the 4-ton unit should be replaced with a 5-ton unit, but that proposal does not include any calculations or other information showing the basis for that conclusion.[1] 28. Under “Stucco/Exterior,” the scope of work provides: “Install elastomeric smooth sand finish stucco to the exterior of house at all new construction areas, with 6” inch pop outs around doors and windows to match existing as close as possible. Skim coat the existing stucco to blend all stucco to match. Stucco color to be blended in.” 29. The elastomeric goes in the base coat and is a colorant that also helps inhibit cracking. 30. Respondent acknowledged that it did not use the elastomeric in the stucco, with Mr. Stevens testifying that Respondent learned that the elastomeric stucco would not have matched the existing stucco because the existing stucco has a #80 size sand and the elastomeric a #10 sand. 31. To compensate for the lack of elastomeric, Respondent used an acrylic in the base coat, it patched all cracks in the existing portion of the house, and painted the entire house with acrylic paint. Mr. Stevens’ opinion is that that this process resulted in a better result than Mr. Bisogno paid for. 32. Ms. Melton testified that she read the scope of work to require that the entire house be covered with elastomeric stucco. But Mr. Stevens presented credible testimony that it would not have been appropriate to cover the existing stucco with the elastomeric stucco. 33. Mr. Stevens also testified that the language in the scope of work that calls for skim coating the existing stucco to blend, is referring to blending the finishes at the junction of the new construction and the existing building, not covering the entire old building, and he reiterated that you should not cover the old stucco with the new stucco. CONCLUSIONS OF LAW 1. Unless otherwise provided by law, a party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119. 2. “At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(2). 3. “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). 4. A preponderance of the evidence is: The 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.

Black’s Law Dictionary 1373 (10th ed. 2014). 5. 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."). 6. “Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B). 7. 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). 8. There was no substantial evidence adduced showing that Respondent is unscrupulous, unqualified or financially irresponsible. 9. The Administrative Law Judge may consider ROC’s administrative record. See Ariz. Admin. Code § R4-9-118. 10. Ariz. Rev. Stat. section 32-1154(A) provides that The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: ***** 3. Violation of any rule adopted by the registrar. ***** 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 which 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. A license shall not be revoked or suspended nor shall any other penalty be imposed for a violation of this paragraph until after a hearing has been held.

11. Ariz. Admin. Code section R4-9-108(A) provides that “A contractor shall perform all work in a professional and workmanlike manner.” 12. Ariz. Rev. Stat. section 32-1154(E) provides that ROC may impose a civil penalty of not to exceed five hundred dollars on a contractor for each violation of Ariz. Rev. Stat. section 32- 1154(A)(22). 13. It has not been shown by a preponderance of the evidence that Respondent’s substitution of the 4-ton air conditioner for the 5- ton unit referenced in the scope or work was a violation of a workmanship standard. To the contrary, the preponderance of the evidence shows that it would have been inappropriate for Respondent to install a 5-ton unit because that unit would have been oversized. The preponderance of the evidence also shows that it would have been inappropriate for respondent to reuse the previously existing 4-ton unit because to do so would have resulted in the units wearing out prematurely. 14. It has not been shown by a preponderance of the evidence that Respondent’s failure to use the elastomeric in the stucco was a violation of a workmanship standard. The preponderance of the evidence shows that the language in the scope of work could not be complied with because the proposed elastomeric stucco would not have matched the existing stucco and it would have been inappropriate to cover the existing stucco with the elastomeric. 15. Consequently, it has not been shown by a preponderance of the evidence that Respondent violated Ariz. Rev. Stat. section 32- 2153(A)(3). 16. The preponderance of the evidence shows that Respondent’s failure to correct items 1 and 18 in the time ROC ordered it to do so was justified because these have not been proven to be workmanship violations. There was no evidence adduced regarding Respondent’s compliance with ROC’s Directive regarding items 8, 20, and 21. Consequently, it has not been shown by a preponderance of the evidence that Respondent violated Ariz. Rev. Stat. section 32-2153(A)(22). 17. Considering the above, this matter should be dismissed. RECOMMENDED ORDER IT IS ORDERED that on the effective date of the final Order in this matter, case number 2018-05503 is 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 is forty days after the date of that certification.

Done this day, August 20, 2019.

/s/ Thomas Shedden Thomas Shedden Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] The proposal does not include a ROC license number and does not show whether Jaycox is licensed.

-----------------------

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