ALJDEC decisions subject to certification as final
2018A-281-CHC-ROC · Registrar of Contractors · 2018-06-13
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Lorrie Ewer,
COMPLAINANT,
v.
Badabo Construction LLC dba,
Badabo Construction,
License No: 295873, 296145
RESPONDENT
No. 2018A-281-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: May 29, 2018, 8:30 A.M.
APPEARANCES: Complainant Lorrie Ewer appeared on her own behalf; Robert Dickey, Member, and Barry Dickey, Member, appeared on behalf of Respondent
ADMINISTRATIVE LAW JUDGE: Roger A. Geddes
_____________________________________________________________________
FINDINGS OF FACT
Background and Procedure
1. Badabo Construction, LLC (Respondent), is the holder of License Numbers 295873 and 296145 issued by the Registrar of Contractors (Registrar).
2. On or about January 22, 2018, Lorrie Ewer (Complainant), filed a Complaint against Respondent with the Registrar alleging poor work in connection with the installation of ceramic floor tile by Respondent at a residence purchased by Complainant in Tucson, Arizona.
3. Upon completion of an inspection performed by the Registrar on February 13, 2018, the Registrar issued a Directive, dated February 15, 2018, requiring Respondent to correct the alleged deficiency in Respondent’s work by March 8, 2018, as follows:
"Ceramic tile floor in the kitchen and dining areas... ...is cracking and the grout is popping out and crumbling. The tiles are also loose."
"...as well as both bathrooms... ...the grout is popping out and crumbling."
4. On March 14, 2018, the Registrar conducted a compliance inspection and observed that Respondent had performed no corrective work. The Registrar then issued a Citation to Respondent, dated March 16, 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).
5. 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 May 29, 2018, at 8:30 A.M. At the hearing, Complainant Lorrie Ewer testified on her own behalf and presented the testimony of Dan Ewer. Robert Dickey, Member, and Barry Dickey, Member, testified on behalf of Respondent. Gregory Johndrow, the Registrar Investigator (Investigator), testified on behalf of the Registrar. The Tribunal received and admitted Complainant’s exhibit numbers 1 - 6.
6. The Investigator on behalf of the Registrar testified as to his communications with Complainant and Respondent, his inspections of the job site, and the Directive issued by the Registrar as a result of his observations from his inspections. Specifically, he testified that he observed the grout deteriorating causing tiles to become loose and highlighted that the conditioned has worsened since his first inspection. He stated that from the photographs it appears there was a breakdown between the tile and the thin set.
7. Complainant testified that she purchased the home on September 17, 2017, and moved in on November 18, 2017. She acknowledged that she declined to have an inspection performed by an independent contractor before purchasing the residence. She stated the flooring began to deteriorate after she moved in and that corrective work was never done.
8. Dan Ewer testified on behalf of Complainant that there were problems with the flooring before escrow closed but the listing agent apparently had someone take care of the issues before Complainant took title. He stated that he contacted Respondent when the issues arose again and Mr. Dickey told him the company that installed the tile was out of business.
9. Barry Dickey testified on behalf of Respondent that Respondent had a verbal contract to install tile with the previous owner of the subject residence, which was ultimately sold to Complainant. He further testified that air conditioning and heating were not working during the tile installation and that thinset needs a certain temperature range to bond. He stated that Respondent could not offer a warranty on its work because the floor was not being installed per manufacturer’s specifications which required installation when the ambient temperature was between 50 and 80 degrees. He stated installation took place when the temperature was below 50 degrees. He further stated that the previous owner said that the lack of a warranty was acceptable because the seller was selling the house as is.
10. Robert Dickey testified on behalf of Respondent that the previous owner was told that it was not a good idea to proceed with the floor installation. He further stated the job start date was delayed several times because of the low temperature until the previous owner demanded that Respondent start the flooring work. He stated that Respondent told the previous owner that there would be no warranty on the work, but acknowledged that were was nothing in writing in that regard. He testified further that Respondent does not dispute the flooring had issues and that Respondent at one point offered to replace some of the tiles.
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 matters is by preponderance of the evidence. See Arizona Administrative Code Rule 2-19-119.
3. To warrant such sanctions by the Registrar, a 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. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive....
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. Complainant has presented sufficient evidence to establish that Respondent’s work was not performed in a professional and workmanlike manner and in violation of A.R.S. § 32-1154(A)(3). Respondent did not contest the existence of the items in the Directive or the failure to correct the items. Respondent only argued that the work was done without a warranty.
7. As a threshold matter, even though Complainant did not contract directly with Respondent, Complainant can proceed directly against Respondent for defective work on property purchased by Complainant. Privity is not required to maintain an action based on breach the implied warranty of workmanship. Richards v. Powercraft Homes, Inc., 139 Ariz. 242, 245 (1984). The ability to proceed against a builder under an implied warranty theory runs to subsequent purchasers. Nastri v. Wood Bros. Homes, Inc., 142 Ariz. 439, 443 (1984).
8. As to Respondent’s defense that it disclaimed a warranty on its work, it is questionable whether a verbal disclaimer of a warranty could ever be effective. However, even had it been in writing, a contractor may not avoid the minimum workmanship standards by limiting its warranty obligations in its contract. The law implies a requirement that a contractor must perform its work in a good, workmanlike manner and in a manner befitting a skilled contractor. “A contractor impliedly warrants that he will perform in a workmanlike manner even though the contract itself does not contain an express warranty of good workmanship.” Kubby v. Crescent Steel, 105 Ariz. 459, 466 1970). To permit Respondent under these circumstances to avoid compliance with workmanship standards would be against public policy. “[I]nnocent purchasers should be protected and builders held accountable for their work. To permit the builder to disclaim a warranty protecting a purchaser from the consequences of latent defects would defeat this principle. We believe it would be against public policy....” Nastri v. Wood Bros. Homes, Inc., 142 Ariz. 439, 442 (1984). The "law does not look with favor upon one exacting a covenant to relieve himself of the basic duty which the law imposes on everyone...This would tend to promote carelessness. Salt River Project Agric. Imp. & Power Dist. V. We, 143 Ariz. 368, 382 (1984) (quoting Union Pacific Railroad Co. v. El Paso Natural Gas Co., 17 Utah 2d 255, 259, 408 P.2d 910, 913 (1965)). There was no evidence presented that Complainant should have been aware that there were any issues with the tile once escrow closed. Moreover, Complainant was not obligated to hire an independent contractor to inspect for latent defects.
9. Complainant has also presented sufficient evidence to demonstrate a violation of A.R.S. § 32-1154(A)(22) for the failure on the part of Respondent to take corrective action without valid justification. There was no dispute that Respondent did not perform corrective work. Respondents offer to replace some of the tiles was not a valid justification to repair the full extent of the deficient work.
10. Accordingly, Complainant has established that Respondent’s license should be disciplined for a violation of A.R.S. § 32-1154(A)(3) and A.R.S. § 32-1154(A)(22).
RECOMMENDED ORDER
Based on the foregoing, it is recommended that on the effective date of this Order, Badabo Construction, LLC’s, License Numbers 295873 and 296145 are suspended for 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, June 17, 2018.
/s/ Roger Geddes
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors