FINACT2018A-2111-CHC-ROC.pdf

2018A-2111-CHC-ROC · Registrar of Contractors · 2018-12-18

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

David Hooker, Case No. 2018-2111 COMPLAINANT, Docket No. 2018A-2111-CHC-ROC v. FINAL ADMINISTRATIVE DECISION K & L Custom Roofing, LLC, AND ORDER License No. ROC 315345, 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.

MODIFICATION & JUSTIFICATION

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 modifies it. In this case the Registrar received a complaint and an amended complaint from Complainant. In response, the Registrar issued two written directives. The first Written Directive required Respondent to correct various deficiencies by July 2, 2018. ALJ Dec. 2:2-4. The Amended Written Directive required Respondent to correct various deficiencies by July 16, 2018. ALJ Dec. 2:18-20. The Registrar issued a citation against Respondent, charging possible violations of Rule 4-9-108, and thereby of A.R.S. § 32- 1154(A)(3) and a possible violation of A.R.S. § 32-1154(A)(22). ALJ Dec. 3:17-23. The Registrar issued the citation on July 9, 2018, seven days prior to the deadline imposed by the second directive. ALJ Dec. 7:17-19. At the hearing, the administrative law judge determined that the evidence established that the Respondent violated Rule 4-9-108, and thereby A.R.S. § 32-1154(A)(3). ALJ Dec. 6:27-29. But the administrative law judge further determined that the evidence established that the Respondent had valid

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 justification for failing to correct the poor work pursuant to the Written Directive and the Amended Written Directive. ALJ Dec. 7:6-15. Generally, Respondents should be afforded a reasonable opportunity to cure an infraction before discipline is imposed: “A breach cannot be said to be material if it is curable, notice to cure is given, and prompt steps are taken to cure or to offer assurances of cure. The right of a breaching party to be given an opportunity to cure its own material breach is an ancient equitable principle…. Cure is relevant to materiality by virtue of its focus on elimination of the breach and its implied assurance of intent to tender adequate future performance…. Providing a cure notice of curable breaches deemed by the nonbreaching party to be sufficiently material to warrant termination for cause is a fundamental prerequisite to termination…. Unless expressly waived, the right to cure is implied in every contract as a matter of law.” Source: Philip L. Bruner and Patrick J. O’Connor, Jr., Bruner & O’Connor on Construction Law, § 18:15 (West Group 2002).

See Registrar of Contractor’s Substantive Policy Statement 2017.01.

In a typical case, the Registrar would dismiss a complaint against a respondent where the

respondent was precluded from correcting the work. However, in this case, due to the confusion

surrounding the written directives and the Registrar’s citation, the Registrar agrees with the administrative

law judge recommendation that Respondent be given proper opportunity to correct the poor work before discipline is imposed, or alternatively, before the case is dismissed. Therefore, the Registrar modifies the Recommended Order to set the terms for providing an opportunity the Respondent to perform corrective work pursuant to the Written Directive and the Amended Written Directive. CONCLUSION The Registrar modifies the Administrative Law Judge Decision by replacing page 8, lines 2-14, of the Recommended Order with “Based on the foregoing, it is recommended that Respondent K & L Custom Roofing, LLC, be afforded an opportunity to perform the corrective work in the Directive and Amended Directive. If on or before December 21, 2018 at 5:00 p.m., the Registrar receives satisfactory

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 evidence that Respondent has corrected the items in the Written Directive and the Amended Written

Directive, the complaint will be closed on the effective date of this Order.

If the Respondent fails to make the corrections, the Respondent’s License No. 315345 shall be

suspended for two days on the effective date of this Order.

If the Complainant refuses access to the Respondent to make the corrections, the Registrar will

dismiss the complaint on the effective date of this Order.”

The Registrar hereby accepts the remainder of the Administrative Law Judge Decision, which

becomes effective on January 20, 2019.

Dated December 11, 2018.

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

Copy mailed via USPS First Class mail December 11, 2018 to: Respondent K & L Custom Roofing LLC 606 W 5th St Ste A Benson, AZ 85602 Complainant David Hooker 3813 N Meagher Rd Willcox, AZ 85643

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 Roger A. Geddes, Administrative Law Judge

Case No. 2018-2111 / AN

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 RECEIVED 11.14.2018 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

No. 2018A-2111-CHC-ROC David Hooker, ADMINISTRATIVE LAW JUDGE DECISION COMPLAINANT v.

K & L Custom Roofing LLC, License No:

315345

RESPONDENT

HEARING: October 4, 2018, 1:00 P.M., October 25, 2018, 1:00 P.M. APPEARANCES: Complainant David Hooker appeared on his own behalf; Justin Lawson, qualifying party of Respondent, appeared on behalf of Respondent ADMINISTRATIVE LAW JUDGE: Roger A. Geddes _____________________________________________________________________ FINDINGS OF FACT BACKGROUND AND PROCEDURE 1. K & L Custom Roofing, LLC (Respondent), is the holder of License Number 315345 issued by the Registrar of Contractors (Registrar). 2. On or about May 9, 2018, David Hooker (Complainant) filed a Complaint

against Respondent with the Registrar alleging poor work on the part of Respondent in

connection with roofing work at a residence in Willcox, Arizona (“project”).

Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 11.14.2018 ROC LEGAL

3. The Registrar performed an inspection of the project on June 5, 2018. Thereafter, the Registrar issued a Directive, dated June 13, 2018, requiring Respondent to correct various alleged deficiencies in Respondent’s work by July 2, 2018, as follows:

1. Correct all gaps in siding where cut short and allowing entry into attic.

2. Correct all soffit joints that have no backing support and nail.

3. Ensure there is 150/1 ration for attic/soffit venting. 4. Missing trim between siding and brick. 5. Seal all open areas where daylight is shining through in attic (Minus soffit vents). 6. Install foam closure strips at bottom of metal panels.

7. Correct valley flashing where cut short. Should extend past fascia approximately 1.5 inches.

4. Thereafter, the Registrar also issued an Amended Directive, dated June 27, 2018, requiring Respondent to correct additional alleged deficiencies in Respondent’s work by July 16, 2018, as follows: 1. Ensure any metal roofing is not scratched from being on ground. 2. Ensure all gaps on Ridge and end pieces are sealed. 3. Ensure all metal is secured.

4. Ensure all fasteners are correct for purpose.

5. Prior to the Amended Directive deadline of July 16, 2018, the Registrar

conducted a compliance inspection of the project on July 6, 2018, and noted that

corrective work had not been fully completed as follows: RECEIVED 11.14.2018 ROC LEGAL

1. Correct all gaps in siding where cut short and allowing entry into attic. 2. Correct all soffit joints that have no backing support and nail. 3. Ensure there is 150/1 ration for attic/soffit venting. 4. Correct missing trim between siding and brick. 5. Seal all open areas where daylight is shining through in attic (Minus soffit vents). 6. Correct valley flashing where cut short. Should extend past fascia approximately 1.5 inches. 7. Ensure any metal roofing is not scratched from being on ground. 8. Ensure all gaps on Ridge and end pieces are sealed.

9. Ensure all metal is secured.

10. Ensure all fasteners are correct for purpose.

6. Further, prior to the Amended Directive deadline, the Registrar issued a

Citation to Respondent, dated July 9, 2018, for the alleged violation of the following: a. A.R.S. § 32-1154(A)(3) (violation of Arizona Administrative Code Rule 4-9-108 for failure to meet minimum workmanship standards); b. A.R.S. § 32-1154(A)(22) (failure to perform corrective action without valid justification). 7. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. The Registrar issued a Notice of Hearing setting a hearing for October 4, 2018, at 1:00 P.M. 8. At the October 4, 2018 hearing, Complainant David Hooker testified on his own behalf; Respondent presented the testimony of Justin Lawson, qualifying party. Mike Springer, the Registrar Investigator (Investigator), testified on behalf of the RECEIVED 11.14.2018 ROC LEGAL

Registrar.1 The hearing was recessed and resumed on October 25, 2018, at 1:00 P.M. At the October 25, 2018, hearing, Complainant David Hooker testified on his own behalf, Respondent presented the testimony of Kristin Lawson, and the Investigator testified on behalf of the Registrar. 9. The Investigator on behalf of the Registrar testified as to his communications with Complainant and Respondent, his inspections of the project, and the Directive issued by the Registrar as a result of his observations from his inspections. Specifically, he testified that he also conducted a pre-hearing inspection on October 3, 2018, and observed that only Directive Item No. 6 had been completed. 10. The Investigator further testified that there were two directives issued and that he believed a mistake was made in issuing the Citation before the Amended Directive deadline. He stated he did not recall telling nor did he believe it would make sense to tell Complainant that Respondent would not be permitted to complete the

repairs before the Amended Directive deadline. He further stated that he seemed to

remember an email or possibly a voicemail in which Respondent advised him that it

had completed the corrective work, but that he could not locate any such email in his

file. He did acknowledge that a note in his file reflected that at the compliance inspection, he advised Complainant that he would be sending the matter to legal and that he advised Complainant that Complainant was not obligated to allow additional work once the Directive deadline had passed. 11. Complainant David Hooker testified that that the Investigator told him at the compliance inspection on July 6, 2018, that Respondent had advised him, the Investigator, that the corrective work had been completed. He stated further that the Investigator told him that Respondent had until July 16, 2018, to complete the work but that because Respondent had claimed it had already completed the work and because Respondent had been given every opportunity to perform corrective action, Complainant was not obligated to allow Respondent to return to do further work.

1 The Tribunal also took administrative notice of the Registrar’s file. RECEIVED 11.14.2018 ROC LEGAL

12. Mr. Hooker further testified that the last corrective work performed by Respondent was on June 25, 2018. He acknowledged that on July 12, 2018, Respondent came out to perform corrective work but that he refused to allow them access based on the statements he attributed to the Investigator. 13. Mr. Hooker asserted that audio recordings of the compliance inspection would confirm what the Investigator had told him and would justify his refusal to allow Respondent access to the property on July 12, 2018. The Tribunal recessed the hearing to allow Complainant the opportunity to submit his audio recording of the compliance inspection, which he did. The Tribunal listened to both Complainant’s audio recording as well as the Investigator’s, neither of which were of sufficient quality to hear entire conversations due to wind noise. However, the Tribunal could discern a conversation between Complainant and the Investigator in which the Investigator advised Complainant that if Respondent wanted to come back to do work “after the

hearing notice,” by that time Respondent would have had sufficient opportunity to do

the work and that Complainant would not be required to allow any further work.

14. Justin Lawson testified on behalf of Respondent that Respondent had

completed Directive items 2, 3, 6, and 7 of the Directive and 2, 3, and 4 of the Amended Directive. He stated Respondent never told the Investigator that the corrective work had been completed and indeed sent workers out on July 12, 2018, to complete the corrective work. He further stated that his workers informed him that Complainant would not allow them to perform any work that day. CONCLUSIONS OF LAW 1. The Registrar has jurisdiction over this matter, pursuant to A.R.S. § 32- 1101, et seq., which authorizes the Registrar to impose disciplinary sanctions against licenses for violations of A.R.S. § 32-1154. 2. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these

RECEIVED 11.14.2018 ROC LEGAL

matters is by preponderance of the evidence. See Arizona Administrative Code Rule 2- 19-119. 3. To warrant such sanctions by the Registrar, Complainant must demonstrate by a preponderance of the evidence that Respondent violated the statutory section cited. Proof by a “preponderance” means that “the evidence is sufficient to persuade the finder of fact that the proposition is more likely true than not.” In re: Arnold and Baker Farms, 177 B. R. 648 (9th Cir. BAP (Ariz.) 1994). See also Culpepper v. State of Arizona, 187 Ariz. 431, 930 P.2d 508 (App. 1996). It is “evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” BLACK’S LAW DICTIONARY 1182 (Rev. 6th ed. 1990). 4. A.R.S. § 32-1154(A) includes in pertinent part among the grounds for

suspension, revocation, or other disciplinary action against a contractor’s license, any

of the following:

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….

5. As it relates to A.R.S. § 32-1154(A)(3) concerning a violation of any rule adopted by the Registrar, Arizona Administrative Code Rule 4-9-108(A), provides that “[a] contractor shall perform all work in a professional and workmanlike manner.” 6. A.R.S. § 32-1154(A)(3). Complainant has presented sufficient evidence to establish that Respondent’s work was not performed in a professional and workmanlike manner and potentially in violation of A.R.S. § 32-1154(A)(3). The RECEIVED 11.14.2018 ROC LEGAL

Investigator testified that only in Directive Item No. 6 was corrected at the time of the July 6, 2018, compliance inspection. There was no dispute that Respondent performed no work after that date. While Respondent contended that it had corrected additional Directive items, Respondent failed to refute Complainant’s evidence that those items had in fact not been corrected. 7. A.R.S. § 32-1154(A)(22). Complainant has failed to present sufficient evidence to demonstrate a violation of A.R.S. § 32-1154(A)(22) for the failure on the part of Respondent to complete corrective action. Respondent asserted that it had a valid justification for not completing the corrective work, namely, Complainant’s refusal to allow Respondent access to the site on July 12, 2018, and prior to the Amended Directive deadline. There was no dispute that Complainant refused access to allow Respondent to complete the corrective work. Accordingly, the Tribunal finds such refusal of access to be a valid justification for Respondent not completing the corrective

work.

8. The circumstances of this case warrant allowing Respondent another

opportunity to perform the corrective work. The Investigator acknowledged that a

mistake had been made in performing a compliance inspection and issuing a Citation before the Amended Directive deadline had passed. While it is open to question whether Complainant was told that he could refuse Respondent access when he did, the Tribunal believes there was sufficient confusion created by the timing of the compliance inspection and the Citation that could have resulted in a misunderstanding on the part of Complainant. However, while Complainant may have been justified in denying access to Respondent, Respondent was similarly justified in not completing the corrective action at that time. In permitting Respondent another opportunity to perform corrective action, neither party would appear to be penalized by the confusion created. 9. Accordingly, Complainant has established that Respondent’s license should be disciplined for a violation of § A.R.S. § 32-1154(A)(3), but has failed to establish that it should be disciplined for a violation of A.R.S. § 32-1154(A)(22). RECEIVED 11.14.2018 ROC LEGAL

RECOMMENDED ORDER Based on the foregoing, it is recommended that Respondent K & L Custom Roofing, LLC, be afforded an opportunity to perform the corrective work in the Directive and Amended Directive. If, on or before 14 days from the effective date of this Order, Respondent provides written proof that is acceptable to the Registrar that it has corrected those items in the Directive and Amended Directive or that Complainant has refused Respondent access to the property to effectuate the corrective work, the Registrar should close the Complaint in this matter. It is further recommended that if, on or before 14 days from the effective date of this Order, Respondent fails to provide written proof that is acceptable to the Registrar that it has corrected those items in the Directive, or that Complainant has refused Respondent access to the property to effectuate the corrective work, the Registrar should suspend Respondent’s License No. 315345 for a period of two days.

In the event of certification of this 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 the certification.

Done this day, November 14, 2018. /s/ Roger Geddes Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors