FINACT2018A-3598-ROC.pdf

2018A-3598-ROC · Registrar of Contractors · 2019-02-07

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Drew Hall, Case No. 2018-3598 COMPLAINANT, Docket No. 2018A-3598-ROC v. FINAL ADMINISTRATIVE DECISION Solarm City, LLC, AND ORDER License No. ROC 318195, 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 March 17, 2019. Dated February 5, 2019. Registrar of Contractors /s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal Department 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 February 5, 2019 to: Respondent Solarm City LLC 1301 E Mountain View Road #229 Phoenix, AZ 85020 Solarm City LLC 10000 N 31st Ave Ste D406D Phoenix, AZ 85051 Complainant Drew Hall 18090 N 170th Ln Surprise, AZ 85374 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 Kay Abramsohn, Administrative Law Judge

Case No. 2018-3598 / AN

of 2 REGISTRAR OF CONTRACTORS 1700 W. Washington St. Suite 105 – Phoenix, AZ 85007-2812 Telephone (602)542-1525 1-877-692-9762 RECEIVED 1.23.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Drew Hall, No. 2018-3598-ROC COMPLAINANT, Docket 2018A-3598-ROC v. Solarm City LLC, ADMINISTRATIVE LAW JUDGE License No: 318195, DECISION RESPONDENT.

HEARING: January 3, 2019 APPEARANCES: Drew Hall (“Complainant”) appeared on behalf of himself. 1 No person appeared on behalf of Solarm City LLC (“Solarm”). ADMINISTRATIVE LAW JUDGE: Kay Abramsohn _____________________________________________________________________ FINDINGS OF FACT 1. On November 13, 2018, the Registrar of Contractors, (“Registrar”), issued a NOTICE OF HEARING setting the above-captioned matter for hearing at 8:30 a.m. on January 3, 2019, at the Office of Administrative Hearings (“OAH”) in Phoenix, Arizona. 2. Solarm holds License No. 318195 issued by the Registrar. 3. On or about June 19, 2018, Solarm and Complainant entered into a home remodeling agreement wherein Solarm would build a screened-in porch on the back of Complainant’s residence. Solarm did not present to Complainant a written contractual agreement; the parties’ agreement consisted of a Solarm “estimate” document and a rough drawing of the project. The agreed contract amount was $2,900.00; Complainant gave Solarm a payment of half the agreed amount (i.e., $1,450.00) to begin the project. 4. Solarm began work on the project and while the work was ongoing, Complainant became concerned about the workmanship and the progress. Initially, Solarm wrote to Complainant that the work would be completed and be “100% correct.” 2 However, on June 25, 2018, Solarm dispatched a “handyman friend of mine” to, apparently, finish the project, stating that ‘there’s a strong chance we may need to use the cross bars to eliminate the wobble.” On June 27, 2018, Solarm wrote a job

1 Complainant filed his pre-hearing disclosure on December 14, 2018 with the Registrar; those documents

are considered to be a part of the Administrative Record in this matter. Solarm failed to file a pre-hearing disclosure. See Complainant’s disclosure, Exhibit B at 6-10.

Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 1.23.2019 ROC LEGAL

order for the handyman “[r]e-square sub screen framing for all but the small one; brad nail at quarter round; and, caulk brad nail holes and paint …”. 3 At the same time, Solarm further indicated to Complainant: I just emailed city of phoenix inspections. I am arranging for an authority figure to settle our disagreement on the patio framing. We will soon find out who is right or wrong. It’s obvious at this point we need a 3rd party to resolve this. Do not cut side deals with dion as he is a 1099 sub with Solarm City and it will only lead to more problems fyi. I’m prepared to take everyone to court if need be as I’ve done in the past successfully because I don’t have time for street fights or gun shots. Talk to you soon about official inspection. 4 All errors in original.

5. On June 27, 2018, Solarm requested a building confidence inspection by the Registrar. 6. A building confidence inspection was conducted on July 13, 2018 by Registrar Investigator Lisa Melton. Because the work was not complete, Investigator

Melton was unable to either substantiate or refute poor workmanship. However, based

on the inspection and the “estimate” document, Investigator Melton noted that Solarm

had “deviated from the plans/specs in regard to the use of MDF.” 5

7. At the time of the inspection, Investigator Melton became aware that

Solarm had not obtained a building permit, which was required by the City of Surprise

(“City”) for such construction activity.

8. On July 17, 2018, City issued a NOTICE OF ORDINANCE VIOLATION regarding

the building permit.

9. Complainant obtained a building permit from City, Permit No. [number redacted].

10. On August 6, 2018, Complainant filed a formal complaint with the

Registrar, listing sixteen (16) complaint items. 11. On August 17, 2018, the City Inspector determined that the project was not complete and that there were multiple construction issues.

Id. at 11; see also Complainant’s disclosure Exhibit F (Job Work Order from Solarm to Dion Vallejos, dated June 27, 2018). Id. at 12. See Complainant’s disclosure, Exhibit E (July 17, 2018 inspection closure letter).

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12. Following a job site inspection, Registrar Investigator Melton issued a DIRECTIVE FROM THE REGISTRAR (“Directive”). The Directive provides in relevant part, as follows: 6 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 aggravating factor should the Registrar pursue discipline of your license. You must notify the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on September 28, 2018.

You are hereby directed to complete the entire scope of the work identified in the contract documents, receive passing building inspection by city building official and provide documentation of the same to the ROC; and remedy the following violations by appropriate means:

[Item] 2: Latch side of door frame is not plumb. - Door is not plumb, work is not complete. Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

[Item] 3: Door is not sized properly to close over installed threshold (header is too low.) - There is drag when closing/opening door, work is not complete. Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

[Item] 6: Finished trim at ponywall and concrete is laying on concrete. Material surface is not treated for concrete contact, nor is it painted for moisture protection from concrete material.

The numbers designated therein as the directed items to be completed reference the listed items on the formal complaint. RECEIVED 1.23.2019 ROC LEGAL

- Trim is installed and does not appear to be treated material or has it been sealed, work is not complete. Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards. [Item] 7: Pony wall finished surface is hardboard T1-11. Contract specifies an MDF material as finished surface. - Respondent stated during the BCP associated with this Complaint that the material was not MDF. Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards. [Item] 8: There is damage to the concrete finish from saw cutting materials. - Complainant identified one scratch outside the entrance to the enclosure, it appears to have resulted from the work performed by Respondent. Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item 9: Stucco is damaged in several places due to installation. - Complainant identified an area which shows chipping in stucco, it appears to have resulted from the work performed by Respondent.

Governing Rule: Workmanship Rule: See A.R.S. § 32-1154 (A) (3), namely R4-9-108, 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.

13. Solarm did not perform any of the corrective work by the September 28, 2018 deadline. 14. On October 3, 2018, the Registrar issued a CITATION alleging that Solarm may have violated ARIZ. REV. STAT. § 32-1154(A)(1); ARIZ. REV. STAT. § 32-1154(A)(2); RECEIVED 1.23.2019 ROC LEGAL

ARIZ. ADMIN. CODE R4-9-108, and thereby, ARIZ. REV. STAT. § 32-1154(A)(3); and ARIZ. REV. STAT. § 32-1154(A)(22). 15. On October 17, 2018, Solarm filed a response, indicating that as to items 2, 3, 6, and 9, “it has already been acknowledged and determined that Solarm City LLC will be in compliance …” Solarm further indicated as to item 7: “Pony Wall finished surface is hardboard T1-11.” Solarm further indicated as to item 8: “There is damage to the concrete finish from saw cutting.” Solarm indicated that there had been “verbal disagreement with the homeowner falsely claiming that the entire patio was not level, plumb, and square.” Finally, Solarm stated that it would be exercising legal rights “to suspend performance” stating that the homeowners were “in violation of ARS 32-1129.04 [sic]” and were “acting in collusion and interrupting performance of construction contract which is in violation of ARS 32-1129.03 [sic].” 16. The Registrar referred the matter to the Office of Administrative Hearings (OAH), an independent agency, to schedule an evidentiary hearing. The hearing was scheduled for January 3, 2019 at 8:30 a.m. 17. Allowing additional time for a possible appearance by the qualified party or any other person on behalf of Solarm, the hearing did not start until approximately 9:00 a.m. No person appeared on behalf of Solarm at the hearing. No person filed a request to appear telephonically on behalf of Solarm. No person on behalf of Solarm contacted OAH to request that the start of the hearing be further delayed or continued to another date. Consequently, Solarm did not present any evidence to defend its license. 18. At hearing, Investigator Melton testified credibly that Solarm did not appear at the pre-hearing inspection on January 2, 2019 and she further testified credibly that no corrective work had been performed or completed. 19. At hearing, Complainant indicated that he initially contacted Solarm based on a referral from a friend. 7 As it had been presented in his disclosure, Complainant testified credibly at hearing that the work was not completed and he further noted that

The hearing record indicates that Solarm works as an authorized subcontractor for Home Depot and Serviz! See Complainant’s disclosure, Exhibit B (text message stream). RECEIVED 1.23.2019 ROC LEGAL

the professional relationship had deteriorated to “ugly” and to the point that Solarm was threatening legal action while Solarm made no efforts to assuage the circumstances. 8 20. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website on January 22, 2019. Such prior License record reflects that Respondent’s License No. 318195 was first issued on February 27, 2018, and was active. Such prior License record also reflects that was one open complaint against Respondent’s license and no prior complaints. CONCLUSIONS OF LAW 1. 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. A.R.S. §§ 41-1092.04 and 41-1092.05(D). 2. 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. 3. “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). 4. “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). 5. 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). 6. Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095

Id. at 1; see also Complainant’s hearing Exhibit A (Solarm response to Complainant’s disclosure) and

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(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”). 7. “Statutes shall be liberally construed to effect their objects and to promote justice.” ARIZ. REV. STAT. § 1-211(B). 8. 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). 9. ARIZ. REV. STAT. § 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: 1. Abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal. 2. Departure 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. 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. 10. ARIZ. ADMIN. CODE R4-9-108 provides that “[a] contractor shall perform all work in a professional and workmanlike manner.” 11. The preponderance of the evidence shows that that Solarm abandoned the contract without legal excuse in violation of ARIZ. REV. STAT. § 32-1154(A)(1). 9 12. The preponderance of the evidence shows that that Solarm departed from the plans and specifications without the consent of the person entitled to have the

Exhibit B (text message stream). The two statutory provisions referenced in Solarm’s written answer are not applicable to the facts in the hearing record. RECEIVED 1.23.2019 ROC LEGAL

project completed in accordance with the plans in violation of ARIZ. REV. STAT. § 32- 1154(A)(2). 13. The preponderance of the evidence shows that Solarm’s construction work failed to comply with professional industry standards as to each item noted in the DIRECTIVE. Poor workmanship, in violation of professional industry standards, is a violation of ARIZ. ADMIN. CODE R4-9-108, and thereby of ARIZ. REV. STAT. § 32- 1154(A)(3). 14. The preponderance of the evidence shows that Solarm failed to comply with the DIRECTIVE to complete the entire scope of the contracted work, which is a violation of ARIZ. REV. STAT. § 32-1154(A)(22). 15. The hearing record demonstrated that Solarm is not capable of being regulated in the performance of construction activity with the public for the following reasons: Solarm failed to provide construction services in compliance with professional industry standards; Solarm failed to comply with the Registrar’s Directive; Solarm demonstrated lack of knowledge as to Registrar inspection processes as he first attempted to bring in an “authority” from the City of Phoenix, rather than either City of Surprise (due to the location of the project) or the Registrar; Solarm demonstrated a lack of knowledge of applicable construction statutes; and Solarm failed to appear at the instant hearing. ORDER Based on the foregoing considerations, the undersigned Administrative Law Judge hereby recommends that Respondent’s License No. 318195 be revoked. 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 forty days from the date of that certification. Done this day, January 23, 2019.

/s/ Kay Abramsohn Administrative Law Judge

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Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors