FINACT2018A-05948-CHC-FinalAgencyAction-6616.pdf

2018A-05948-ROC · Registrar of Contractors · 2019-11-14

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Ann Marie Scott, Case No. 2018-05948

COMPLAINANT, Docket No. 2018A-05948-CHC-ROC

v. FINAL ADMINISTRATIVE DECISION AND ORDER A and W Remodeling LLC, License No. ROC 211961, 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 of each finding of

fact or conclusion of law.

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 accepts it.

CONCLUSION AND ORDER

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 December 22, 2019.

IT IS FURTHER ORDERED that Respondent pay a civil penalty in the amount of $500.00 payable to

the Registrar on or before 30 days from the effective date of this Order. Payment may be hand-delivered to the

Registrar’s physical address or mailed to:

Registrar of Contractors P.O. Box 6748 Phoenix, Arizona 85505-6748 FINAL NOTE

On page one, paragraph two, line 26, replace “June 1” with “January 6.”

On page two, paragraph six, line 15, replace “10” with “58.”

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. – Ste. 105 – Phoenix, AZ 85007-2812 Telephone (602) 542-1525 Toll Free (877) 692-9762 Lg131 8/19 On page two, paragraph seven, line 22, remove “A.R.S. § 32-1154(B).” On page two, paragraph eight, line 26, replace “A.R.S. § 32-1154(B)” with “A.R.S. § 32-1155(A).” On page five, paragraph 22, line 11, replace “28” with “8.” On page five, paragraph 22, line 12, replace “comply” with “complete.” On page seven, line 16, replace “A.R.S. § 32-1101(A)(5)” with “A.R.S. § 32-1101(A)(7).” Dated November 12, 2019. By: /s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal Department and Recovery Fund Arizona Registrar of Contractors Copy mailed via USPS First Class Mail November 12, 2019 to: Respondent A and W Remodeling LLC 42011 N 7th St Desert Hills, AZ 85086

Complainant Ann Marie Scott 15222 N 44th Pl Phoenix, AZ 85032 Complainant’s Attorney John L. Dillingham, Esq. The Law Office of John L. Dillingham 4835 E Cactus Rd Ste 260 Scottsdale, AZ 85254 Copy sent electronically this same date to: Office of Administrative Hearings Antara Nath Rivera, Administrative Law Judge Respondent at email address on record with the Registrar Complainant at email address on record with the Registrar

Case No. 2018-05948 / KR

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. – Ste. 105 – Phoenix, AZ 85007-2812 Telephone (602) 542-1525 Toll Free (877) 692-9762 Lg131 8/19 RECEIVED 10.23.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Ann Marie Scott, No. 2018A-05948-ROC COMPLAINANT v. ADMINISTRATIVE LAW JUDGE DECISION A and W Remodeling, LLC, ROC License: ROC 211961, RESPONDENT

HEARING: August 7, 2019 and October 2, 2019 APPEARANCES: John Dillingham, attorney, appeared behalf of Ann Marie Scott (“Complainant”). Ernest Bustamante, attorney, appeared on behalf of A and W Remodeling, LLC (“Respondent”). ADMINISTRATIVE LAW JUDGE: Antara Nath Rivera _____________________________________________________________________ FINDINGS OF FACT 1. On October 2, 2005, the ROC issued License No. 211961 for Specialty Dual CR-61 Carpentry, Remodeling, and Repairs to A and W Remodeling, LLC (“Respondent”). Respondent’s address of record for the license is 42011 North 7th Street, Desert Hills, AZ 85086-5614. Kevin Lee Allen is listed on the license as Qualifying Party and Member. Richard James Ward is listed on the license as Member.1 2. Administrative Notice is taken of Respondent’s prior License record, for License No. 211961, as reflected on the ROC’s public website on October 2, 2019. Such prior License record reflects that Respondent’s license is currently active. The record also reflects that there are three open complaints against Respondent’s license, one of which is presumed to be related to this matter. There is one resolved/settled case reflected on the license. Respondent has an active $6,750.00 surety bond issued through Merchant’s Bonding Company effective June 1, 2017.2 3. On or about May 18, 2018, Ann Marie Scott (“Complainant”) entered into a verbal contract agreement whereby Respondent agreed to renovate her residential

1 See https://roc.az.gov/contractor-search?Id=a0Yt000000ACZSPEA5. Id. Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 10.23.2019 ROC LEGAL

home located at 15222 North 44th Place, Phoenix, AZ 85032 for the sum total of $23,570.00. The project commenced on July 26, 2017, and stopped on December 4, 2018. Complainant paid Respondent a total $20,500.00 by the time Respondent

stopped working.

4. On or about December 14, 2018, the ROC received a workmanship

complaint from Complainant. On the complaint, Complainant indicated poor

workmanship and abandonment as the basis for the complaint.

5. On or about December 21, 2018, the ROC issued a Jobsite Inspection

Notification letter to the parties, providing proper notice to them, and advising that an

onsite review would be conducted at the project site by an ROC investigator on January

18, 2019.

6. On January 18, 2019, ROC investigator Steve Klein (“Investigator Klein”)

conducted a review of the estimates that were agreed upon between the parties.

Investigator Klein also inspected the work that had been done on the project to date

and took 10 photographs of the property.

7. On or about January 22, 2019, Investigator Klein issued a Directive from

the Registrar to Respondent because he substantiated Complainant’s allegation that Respondent’s work failed to meet minimum ROC workmanship standards. Specifically, Respondent was ordered to remediate complaint items 1, 3-5, 7-17, 20-37, and 39 via appropriate means. Respondent was put on notice that it had until February 8, 2019, to notify the ROC of its compliance with the Directive or face discipline pursuant to ARIZ. ARIZ. REV. STAT. § 32-1154(B) and 32-1154(E). Respondent failed to timely comply. 8. On or about February 12, 2019, the ROC issued a Citation to Respondent for alleged violations of ARIZ. REV. STAT. §§ 32-1154(A)(3) and 32-1154(A)(22), and ARIZ. ADMIN. CODE R4-9-108. Respondent was given until February 27, 2019, to respond with its Answer or face discipline pursuant to ARIZ. REV. STAT. § 32-1154(B). 9. On or about February 27, 2019, Respondent filed an Answer to the Citation. In its Answer, Respondent stated that Respondent continued to work on Complainant’s property and that 80% to 90% was completed. Respondent further stated that it had a key to Complainant’s home because Complainant wanted more RECEIVED 10.23.2019 ROC LEGAL

work done on the home because she was selling her home. In its Answer, Respondent indicated that Respondent and Complainant had “an amicable working relationship.” 10. On or about March 1, 2019, the ROC referred this matter to the Office of

Administrative Hearings, an independent state agency, for an evidentiary hearing on

August 7, 2019.

11. Per the Citation, the issue to be determined is whether the ROC has

cause to discipline Respondent’s license based on the following charges:

Charge 1: A violation of A.R.S. § 32-1154(A)(3)-R4-9-108. (“Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108.”). Charge 2: A violation of A.R.S. § 32-1154(A)(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.”).

12. On or about August 2, 2019, Investigator Klein conducted a prehearing inspection. He observed that items 1, 15, and 25 were completed but all other items listed on the Directive were not corrected. HEARING EVIDENCE 13. Investigator Klein testified that there were three complaints filed by Complainant. With respect to compliance with the Directive, Respondent completed 75% of work as listed on the Directive. Moreover, Respondent did not start work on the contract in the amount of $10,000.00. Thus, Respondent abandoned that project and performed poor workmanship on the other projects. 14. At hearing, Complainant testified that, at all times relevant, she was the owner of 15222 North 44th Place, Phoenix, AZ 85032. Complainant had a verbal agreement with Respondent for Respondent to perform a home remodel project. While there was no contract, Respondent created invoices to evidence the work to done and the prices.

RECEIVED 10.23.2019 ROC LEGAL

15. In its invoice #1974, dated September 26, 2017, Respondent addressed the remodeling of the hall bath. Complainant paid $3,300.00 for that project. In its invoice #1994 dated September 11, 2017, Respondent addressed additional remodel

of the hall bath, including fixing work that was done pursuant to invoice #1974.

Complainant paid $1,500.00 for that project. In its invoice #1995, dated September 11,

2017, Respondent addressed the remodeling of the master bathroom. Complainant

paid $6,000.000. In its invoice #2036, dated February 2, 2018, Respondent addressed

the installation of tile for the entire floor and the installation of carpeting for the

bedroom. Complainant paid Respondent $10,000.00 for that project.

16. Complainant paid Respondent the above amounts in good faith.

Complainant was not satisfied with Respondent’s work from invoice #1974 due to

crooked and uneven tiles, poorly done grout work, and mismatched paint. Complainant

requested Respondent to fix these issues. Instead of fixing the issues, Respondent tore

up the bathroom completely. Complainant did not want the bathroom torn up. Based on

this work, Respondent created invoice #1994.

17. In addition to invoice #1974 and invoice #1994, Complainant requested

Respondent to install tile. Respondent did not create a change order, but created invoice #2036. Respondent never started this project despite being paid $10,000.00. 18. While there may be have miscommunication between the parties with respect to the key, Complainant gave access to Respondent to complete all of the projects. 19. Richard Ward testified on behalf of Respondent. Mr. Ward agreed with Complainant to remodel Complainant’s bathrooms. When Complainant was unsatisfied with his work, Mr. Ward redid his work to make sure Complainant was happy. Complainant changed her mind throughout the project. Respondent incurred additional costs and expenses as a result of Complainant’s changes. 20. Invoice #2036 was Complainant’s request. Respondent was unable to begin this project because Respondent did not complete the master bathroom. 21. Mr. Ward’s mother, Kathy Mendiola, assisted Mr. Ward in handling the paperwork for this project as well as handling Complainant. When Complainant RECEIVED 10.23.2019 ROC LEGAL

changed her mind, Ms. Mendiola created a change order. She later shredded it because Complainant did not sign it. Ms. Mendiola then drafted invoice #10071, which was signed by Complainant, to address the remaining issues. Complainant agreed that

Respondent was to fix and complete the work, on invoice #10071, at no additional

charge. Work addressed in invoice #10071 was also addressed in the Directive.

22. Mr. Ward acknowledged that he did not perform any work between the

date the Directive was issued and the compliance deadline. Mr. Ward’s testimony

regarding the Complainant’s key and access to her home was inconsistent. However,

Respondent’s February 27, 2019 email to the ROC confirmed that Complainant gave

her key to Mr. Ward. The last day Mr. Ward worked at Complainant’s home was on

February 28, 2019. Thus, up until that time, Respondent was allowed to perform

corrective work. However, Respondent failed to comply the requisite corrective work

and was not in compliance with the Directive. Furthermore, Mr. Ward did not return

Complainant’s money for the project he did not begin.

CONCLUSIONS OF LAW

1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. The copy of the Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and Respondent is deemed to have received notice of the hearing. See A.R.S. §§ 41-1092.04 and 41-1092.05(D). 2. The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. 3. 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). 4. ARIZ. ADMIN. CODE 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.” RECEIVED 10.23.2019 ROC LEGAL

5. ARIZ. REV. STAT. § 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.”

6. ARIZ. REV. STAT. § 32-1154(A)(22) holds, in pertinent part, that “[a] holder

of a license may not fail to take appropriate corrective action to comply with this chapter

or 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. The Registrar has the authority to issue license discipline under this

provision, including summary suspension, revocation, or imposing a civil penalty or

recovery fund award.”

7. ARIZ. REV. STAT. § 32-1154(E) holds, in pertinent parts, that the Registrar

may “[i]mpose a civil penalty not to exceed five hundred dollars on a contractor for each

violation. The failure by the licensee to pay any civil penalty imposed results in the automatic revocation of the license thirty days after the effective date of the order providing for the civil penalty. It also holds that no future license may be issued to an entity consisting of a person who is associated with the contractor, unless payment of any outstanding civil penalty is tendered.” 8. Complainant established, by a preponderance of the evidence, that work performed by Respondent, on invoice #1974, invoice #1994, and invoice #1995 were not done in a professional and workmanlike manner. In addition, work performed by Respondent on invoice #10071 was also not done in a professional and workmanlike manner. Thus, there are sufficient facts in the record to conclude that Respondent violated ARIZ. REV. STAT. § 32-1154(A)(3), namely A.A.C R4-9-108, by a preponderance of the evidence 9. Furthermore, the Registrar issued its Directive to Respondent on January 22, 2019, and required Respondent’s full compliance by February 8, 2019. Respondent RECEIVED 10.23.2019 ROC LEGAL

failed to comply. There are sufficient facts in the record to conclude that Respondent also violated ARIZ. REV. STAT. § 32-1154(A)(22), by a preponderance of the evidence. 10. Complainant may petition the Registrar’s Recovery Fund for financial

recompense regarding this matter, as the Tribunal has no jurisdiction to award a refund

of the underlying amount contracted between the parties.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that on the effective date of the Order, the Registrar

shall suspend Respondent’s License No. 211961 for a period of three (3) days.

IT IS FURTHER RECOMMENDED that the Registrar require Respondent to pay the sum of $500.00 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 final 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 40 days from the date of that certification.

Done this day, October 22, 2019.

/s/ Antara Nath Rivera Administrative Law Judge Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors