ALJDEC decisions subject to certification as final

2018A-3634-ROC · Registrar of Contractors · 2019-04-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 22, 2019, at 8:30 a.m. APPEARANCES: Patricia Dressler (“Complainant”) appeared on her own behalf; Lam Construction, Inc. (“Respondent”) appeared through Matthew James Mansfield, Esq. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure 1. According to the Arizona Registrar of Contractors’ (“the Registrar’s”) public website, on or about July 26, 2007, the Registrar issued License No. ROC 235663 for General Dual KB-2 Dual Residential and Small Commercial contracting to Respondent. 2. On or about August 7, 2018, Complainant filed a complaint with the Registrar against Respondent that alleged that it had performed poor work on its contract to replace a shower enclosure in Complainant’s master bathroom in her home at 911 Palo Verde Drive, Bullhead City, Arizona 86442. According to the complaint, the contract was oral and Complainant had paid Respondent $1,500.00 of the $2,572.55 contract amount for materials. 3. The complaint alleged nine specific items, including that water was leaking out of the shower through doors and underneath the track, but did not allege that the shower drain was leaking. Complainant also complained that Respondent had failed to install the shower enclosure and that she “[did] not have a shower in [her] master bath – just empty space and damaged walls.”[1] 4. On or about August 17, 2018, Respondent’s officer/qualifying party, Lee Messer, filed a preliminary response, stating that he installed a shower enclosure but that he discovered that it was damaged and that the shower enclosure that Complainant had ordered was on back order. 5. Mr. Messer also stated that Complainant’s mobile home was out of level and not plumb, and that because the jacks had already been raised as much as they could be raised, Respondent could not do anything to make the home more level. Mr. Messer also stated that when he installed the first shower enclosure, he water-tested by moving the shower head in all directions, and the shower did not leak.[2] 6. The Registrar assigned the complaint to its Investigator, Cliff Corlett, for investigation. On or about August 30, 2018, Investigator Corlett sent a letter to Complainant, informing her that the complaint was closed because “[t]he Registrar determined that this project is currently delayed due to backordered shower enclosure materials beyond the Contractor[’]s control.”[3] 7. On or about November 11, 2018, Complainant sent an email to Investigator Corlett, informing him that Respondent had installed the shower enclosure on November 2, 2018, but stating that the enclosure still leaked.[4] 8. Investigator Corlett reopened the complaint and performed a jobsite inspection on November 30, 2018. On December 5, 2018, Investigator Corlett on behalf of the Registrar issued a directive to Respondent, requiring it to perform certain corrections prior to December 26, 2018, at 5:00 p.m., in relevant part as follows: Complaint Item 1: Shower doors not hung straight. Investigator’s Observation: The existing home structure appears to have significant problems with being square, plumb and level. That being said it is clear that the Respondent was aware of these difficulties. Shower door kits are somewhat adjustable to compensate for some plumb and level issues. Respondent should properly readjust the shower doors to reach the best position possible to contact/engage the door guides and bumpers

Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 2: Shower doors touch top bumper on both sides but not the bottom bumpers. Investigator’s Observation: Respondent should properly readjust the shower doors to reach the best position possible to contact/engage the door guides and bumpers Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 3: Right door does not even appear to fit in the door guide. Investigator’s Observation: Respondent should properly readjust the shower doors to reach the best position possible to contact/engage the door guides and bumpers Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 4: Water on floor after showering. Investigator’s Observation: Shower door height adjustment is somewhat limited and is generally pre-set at the factory by the length of the kit side rails. Respondent should properly re-adjust the shower doors to properly engage the side rail bumpers [and] guides while keeping the doors as low as possible to the bottom track. Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 5: Drain is a little off center. Investigator’s Observation: Respondent should properly re-center shower floor drain. Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 6: Minor damage to walls. Investigator’s Observation: Respondent stated that installing the shower pan section caused some damage to Complainants walls. Respondent should correct by appropriate methods matching surrounding areas as closely as possible. Governing Rule: A.R.S. §32-1154-A. (3)(namely A.A.C. R4-9-108 Workmanship Standards for Licensed Contractors).

Complaint Item 7: In November 2018 Complainant received invoice for new shower kit. Complainant already paid for previous marble shower kit. Investigator’s Observation: The Registrar’s office does not have the authority, by statute, to settle disputes over contracts/money. If the parties cannot come to an agreement, then they should seek relief from other legal forums. Governing Rule: N/A. No workmanship violation could be substantiated.

9. On January, 2019, Investigator Corlett performed a compliance jobsite inspection. His Compliance Jobsite Inspection Notes stated that the only item that was not in compliance was that “Shower door installation and operation were acceptable at the time of Compliance inspection with the exception that the left side door closes by itself. There was also a small paint repair needed to the exterior side wall.”[5] 10. Investigator Corlett referred the complaint to the Registrar’s Legal Department. On February 4, 2019, the Registrar issued a Citation against Respondent’s license, charging cause to suspend or revoke the license under A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(22). 11. Respondent filed a timely written answer to the Citation, denying any statutory violations. 12. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. 13. A telephonic evidentiary hearing was held from the Registrar’s Flagstaff office on April 22, 2019. Complainant submitted 25 exhibits, testified on her own behalf, and presented the testimony of Terry Dell, an employee of Superior Mobile Home Service, who had leveled the mobile home. Respondent presented the testimony of Mr. Messer and James Bullard, a journeyman carpenter employed by Respondent who had worked on the project. Investigator Corlett also testified. Hearing evidence 14. Complainant’s mobile home is a 1992 model. In 2017, the floor in Complainant’s master bathroom had water damage. In April 2017, her insurance company paid $1,966.96 to her to repair the leak.[6] 15. Complainant is employed by a property management company. Mr. Messer testified that over the last seven years, Respondent has performed 293 jobs for the property management company that employs Complainant. 16. Respondent contracted to repair the floor in Complainant’s master bathroom. To access the floor, the shower enclosure had to be removed and could not be reused. Complainant originally picked out a cultured marble shower enclosure, but that enclosure had to be removed. As noted above, the fiberglass shower enclosure that Complainant selected was on back order, which delayed Respondent’s completion of the job. 17. Investigator Corlett testified that he performed the first jobsite inspection on August 21, 2018. Because the shower enclosure that Complainant wanted was on back order, the shower stall was empty. He closed the complaint until the shower enclosure that Complainant had selected became available for Respondent to install. 18. Investigator Corlett testified that he performed a second jobsite inspection after Respondent installed the second shower enclosure. Investigator Corlett testified that the most significant items on the December 5, 2018 directive was that the drain was off center and that the left door of the shower enclosure, if left open, would self-close. Investigator Corlett testified that the shower enclosure had a top rail from which the shower doors hung over a bottom rail. 19. Investigator Corlett testified that the mobile home’s walls were not perfectly plumb and that the shower was 3/8” to ½” wider at the top than the bottom. 20. Investigator Corlett testified that he scheduled a compliance inspection after Complainant contacted him again. At the January 11, 2019 compliance inspection, Complainant stated that she did not want Respondent to repair the small nick on the wall, because it would just put a patch like it had on the other wall. Investigator Corlett testified that, if the small nick had been the only item not in compliance, he would have closed the complaint at that time. 21. Investigator Corlett testified that, at the January 11, 2019 compliance inspection, the left shower door was acceptable, except that the left shower door, although improved, still self-closed if left open. Investigator Corlett testified that he thought that the door could be fixed and the parties agreed that Respondent would make one more attempt to fix the door. As a former carpenter, Investigator Corlett knows that there are measures that can be taken to make surfaces level and plumb, even if the structure is not. 22. Investigator Corlett acknowledged that he performed a prehearing inspection on April 4, 2019, which Complainant and another contractor attended. The left door to the shower still moved slightly on its own. Investigator Corlett suggested that Respondent might have installed the hardware for the door incorrectly. 23. Investigator Corlett acknowledged that he did not measure the hardware or notice anything awry with Respondent’s installation of the hardware. He acknowledged that the right shower door’s movement would be stopped by weather-stripping. 24. Mr. Messer testified that he followed the manufacturer’s instructions when Respondent installed the hardware on the door. 25. Investigator Corlett testified that the left shower door continued to move due to gravity because the mobile home was not plumb, level, or square, or some combination. Investigator Corlett testified that he put a 4’ level on the top rail and on the shower pan and both appeared to be level. 26. Mr. Messer testified that Respondent had gone out at least four times to adjust the shower door. Mr. Messer testified that the door could not be adjusted further. Any deficiencies in the door were due to the floor in Complainant’s manufactured home not being level and the walls not being plumb or a manufacturing defect in the shower that Complainant picked out. 27. Investigator Corlett testified that a property owner is responsible for making a claim to the manufacturer of a defective product that has been installed in her home. 28. Mr. Bullard testified that he performed repairs at Complainant’s mobile home and that he shimmed and wedged to raise the floor under the shower enclosure to make it level. He adjusted the jacks under the floor as much as he could, but the floor was still not level. 29. Investigator Corlett stated that the Registrar’s workmanship standards require that if a contractor undertakes to install a product on an imperfect surface, the contractor accepts the surface as adequate to support the project. If the contractor has reservations about whether the surface is adequate, he must get a written, signed disclaimer of warranty from the property owner before he performs the work. 30. Mr. Dell testified that, on March 24, 2017, he releveled Complainant’s mobile home and deemed it to be level. 31. Mr. Dell testified that he re-inspected the mobile home on March 8, 2019, and found that it was still level. Mr. Dell testified that on March 8, 2019, he saw a small leak under the master bathroom drain. 32. Investigator Corlett testified that Complainant told him at the April 4, 2019 prehearing inspection that it was possible that there was a leak under the home, as evidenced by damp soil. Investigator Corlett testified that he had required Respondent to re-center the shower drain, but that he did not know if Respondent caused the leak. Investigator Corlett noted that Complainant had not previously complained about a leak. 33. Mr. Messer testified that when Respondent re-centered the drain, it sealed and tested the drain for leaks, but did not identify any leaks. Mr. Messer testified that there were other pipes in the area where Mr. Dell allegedly observed the leak. Mr. Messer testified that when Respondent re-centered the shower drain, it did not affect the line that connected the drain to the sewer because Respondent did not disturb the pre-existing piping between the drain and the sewer. 34. Mr. Dell testified that manufactured homes frequently sag at the marriage line. There was no way to correct the sag except floating out the whole floor. Although it was possible that Complainant’s manufactured home was sagging at the marriage line, most people would not notice unless they were barefoot. 35. Complainant testified that the previous shower that Respondent removed to fix the floor did not leak, but that there is water on the floor whenever she takes a shower in the new shower. The previous shower was removed because a leaking valve had damaged the subfloor. 36. Mr. Messer testified that no shower door is waterproof. Depending on how Complainant took her showers, she could cause water to splash from the shower onto the floor. 37. Complainant acknowledged that Mr. Messer told her that the floors in her manufactured home were not level and the walls were not plumb when Respondent contracted to repair the floor. Complainant testified that Mr. Messer never told her that he could not replace the shower enclosure. 38. Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s prior disciplinary history as shown on the Registrar’s public website on this date. Respondent’s license is active and in good standing. No discipline has ever before been taken against the license and Complainant’s appears to be the only complaint pending against the license. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction.[7] 2. Complainant bears the burden of proof to establish cause to suspend or revoke Respondent’s license by a preponderance of the evidence.[8] Respondent bears the burden to establish affirmative defenses and factors in mitigation of the penalty by the same evidentiary standard.[9] 3. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[10] A preponderance of the evidence is “[t]he 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.”[11] 4. The four items of workmanship that Complainant complained about at the hearing were (1) The paint nick on the wall; (2) The alleged leak under the shower drain; and (3) The alleged leak in the shower door that caused water to end up on the bathroom floor whenever Complainant took a shower; and (4) The left shower door that self-closed. 5. Construction is not a perfect art and, normally, contractors must be allowed an opportunity to correct poor workmanship before their licenses may be suspended as a result of their failure to comply with workmanship standards. Complainant told Investigator Corlett that she did not want Respondent to repair the nick. Therefore, the Administrative Law Judge cannot find that nick furnishes cause to suspend or revoke Respondent’s contractor’s license. 6. Complainant never complained about the alleged leak under the shower until the prehearing jobsite inspection. Investigator Corlett never had an opportunity to investigate the alleged leak. Mr. Messer’s testimony that he sealed the connection between the repositioned drain and the drain pipe, that Respondent did not alter the existing drain pipe, and that there were other pipes in the area that could be leaking was credible. Therefore, Complainant did not establish that the alleged leak under the shower enclosure furnished cause to suspend or revoke Respondent’s contractor’s license. 7. Despite Investigator Corlett’s numerous jobsite inspections, Complainant never ran the shower to demonstrate to Investigator Corlett that the shower enclosure leaked. Investigator Corlett did not find that the shower leaked at the compliance or prehearing jobsite inspections. Photographs of water on the bathroom floor do not establish that the source of the water was a leak in the shower enclosure. Therefore, Complainant did not establish that the alleged leak in the shower enclosure furnished cause to suspend or revoke Respondent’s contractor’s license. 8. Respondent established that that the floor in that master bathroom of Complainant’s manufactured home is not level, that the walls are not plumb, and that these conditions may prevent the left door on the shower enclosure from being installed so that it does not self-close. Complainant acknowledged that Mr. Messer pointed out that the floor was not level and that the walls were not plumb and expressed some concerns about the effects on the job of the manufactured home’s condition. However, a contractor who has expressed doubts about the condition of a jobsite cannot escape liability under the Registrar’s statutes unless the contractor has obtained a written waiver signed by the property owner.[12] Respondent did not submit a written warranty disclaimer signed by Complainant. 9. Although Respondent has improved the condition of the left door on the shower enclosure, it still self-closes. Therefore, Complainant established cause to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3),[13] namely A.A.C. R4-9-108,[14] and A.R.S. § 32-1154(A)(22)[15] in by failing to fully correct the self-closing left door on the shower enclosure. RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the final order in this matter, License No. ROC 235663 of Respondent Lam Construction, Inc. shall be suspended for a period of one (1) business day. Given the numerous times that Respondent attempted repairs and the condition of the manufactured home, no civil penalty should be imposed under A.R.S. § 32-1154(E). 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 five days from the date of that certification. Done this day, April 29, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] The Registrar’s electronic record at pdf page 82-83. [2] See id. 72-76. [3] Id. at 53. [4] See id. at 37-38. [5] Id. at 23. [6] See id. at 90-91. [7] See A.R.S. § 32-1154(A). [8] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [9] See A.A.C. R2-19-119(B)(2). [10] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [11] Black’s Law Dictionary at page 1220 (8th ed. 1999). [12] See Nastri v. Wood Bros. Homes, Inc., 142 Ariz. 439, 441-42, 690 P.2d 158, 160-61 (App. 1984) (citing Darner Motor Sales, Inc. v. Universal Underwriters Insurance Co., 140 Ariz. 383, 682 P.2d 388 (1984) and Peterson v. Hubschman Construction Co., Inc., 76 Ill. 2d 31, 389 N.E.2d 1154 (1979)). With respect to warranty disclaimers or waivers, according to the Arizona Court of Appeals’ authority,

Although the implied warranty of habitability is a creature of public policy, we do not consider a knowing disclaimer to be against the public policy of this State. However, we do hold that any such disclaimer must strictly be construed against the builder- vendor. . . . We refer to the well-reasoned opinion of the Supreme Court of Missouri in Crowder v. Vandendeale (Mo. 1978), 564 S.W.2d 879, where it was held that “boilerplate” clauses, however worded, are rendered ineffective in such a disclaimer (564 S.W.2d 879, 881), and the court further stated:

“[O]ne seeking the benefit of such a disclaimer must not only show a conspicuous provision which fully discloses the consequences of its inclusion but also that such was in fact the agreement reached. The heavy burden thus placed upon the builder is completely justified, for by his assertion of the disclaimer he is seeking to show that the buyer has relinquished protection afforded him by public policy. A knowing waiver of this protection will not be readily implied.” (Emphasis in original.) Crowder v. Vandendeale (Mo. 1978), 564 S.W.2d 879, 881 n.4.

Petersen, 76 Ill. 2d at 43, 389 N.E.2d at 1159 (1979) (some authorities omitted; emphases added and in original). [13] A.R.S. § 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.” [14] A.A.C. 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.” [15] A.R.S. § 32-1154(A)(22) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure 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.”

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