ALJDEC decisions subject to certification as final

2019A-00422-CHC-ROC · Registrar of Contractors · 2019-07-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 14, 2019, at 8:30 a.m. APPEARANCES: Alexander John MacPhail (“Complainant”) appeared on his own behalf; Desert Meadow Construction Co. LLC (“Respondent”) appeared through Stephen Frank Barrett, its member/qualifying party. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure 1. According to the Arizona Registrar of Contractors’ (“the Registrar’s”) public website,[1] on January 25, 2008, the Registrar issued License No. ROC 239372, for General Dual KB-1 Dual Building Contracting to Respondent. 2. On or about January 25, 2019, Complainant filed a complaint with the Registrar, alleging that Respondent had committed three instances or poor work performing its contract to extend the porch roof and to extend the patio slab at Complainant’s residence at 6766 S. Ranch Rd., Hereford, Arizona 85615, including that the roof leaked and the patio slab was flaking. 3. Complainant attached to his complaint a Construction Agreement between himself and his wife and Respondent. The construction agreement included Respondent’s name, business address, and license number, Complainant’s name, mailing address, and the jobsite address, the date the parties signed the agreement, an estimated date of completion, a detailed description of the work to be performed, the total dollar amount, including applicable taxes, the dollar amount of the material advance due upon execution of the agreement, progress payments, and the final payment, and advice to Complainant and his wife of their right to file a complaint against Respondent with the Registrar for a violation of A.R.S. § 32-1154(A) within the time allowed by A.R.S. § 32-1155(A), along with the Registrar’s telephone number and website address.[2] However, the Construction Agreement was only to replace the original porch with a concrete patio extension. 4. The complaint was assigned to the Registrar’s Investigator Michael Springer for investigation. On February 25, 2019, Investigator Springer performed a jobsite inspection. 5. On February 25, 2019, Investigator Springer on behalf of the Registrar issued a Directive that required Respondent to correct two items on Complainant’s complaint on or before March 14, 2019, at 5:00 p.m., in relevant part as follows: Complaint Item 1: Leaking where the porch extension meets the existing porch. Water leaks through.

Complaint Item 3. Concrete pad is flaking up after less than a year from being poured.

6. On March 26, 2109, the Registrar issued a Citation against Respondent’s contractor’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, A.R.S. § 32- 1154(A)(12), namely A.R.S. § 32-1158(A), and 32-1154(A)(22). 7. Respondent filed a timely written answer to the Citation, denying any statutory violation. 8. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. 9. A videoconference hearing was held on June 14, 2019. Complainant submitted one exhibit and testified on his own behalf. Respondent submitted eleven exhibits and presented the testimony of its member/qualifying party, Stephen Frank Barrett. Investigator Springer also testified. Additional Hearing Evidence 10. Complainant testified that he allowed Respondent unrestricted access to the jobsite and that he allowed an extra week for Respondent to comply with the Directive. 11. Investigator Springer testified that on March 25, 2019, he performed a compliance inspection. Because the two items on the directive were not repaired to comply with the Registrar’s workmanship standards, he forwarded Complainant’s complaint to the Registrar’s Legal Department. 12. Investigator Springer testified that he recommended that the Citation should include a charge that Respondent violated A.R.S. § 32- 1154(A)(12), namely A.R.S. § 32-1158(A), because the parties’ addendum to the original contract in which Respondent agreed to extend the porch roof did not contain all of the elements required by A.R.S. § 32- 1158(A). 13. Investigator Springer acknowledged that he had not performed a water test at the compliance inspection but testified that the repairs to the roof that Respondent attempted to stop the leak did not comply with the Registrar’s minimum standards. Investigator Springer explained that Respondent had used excessive caulk and foam on the repair and that there was sealant all over the roof. Investigator Springer explained that, in Arizona, after a year or less, sealant will be dust after it is exposed to the sun. Investigator Springer testified that sealant was not intended or supposed to be the main defense against leaks on a roof. In addition, Respondent’s application of the sealant was unsightly. 14. Investigator Springer acknowledged that Complainant had placed a picnic table on the concrete slab near where the slab was flaking. Investigator Springer testified that a slab should be able to hold the weight of a picnic table or other patio furniture without the concrete failing. 15. Complainant testified that the picnic table was like similar furniture that could be purchased at Home Depot. Complainant testified that the table weighed only 100 pounds. Complainant testified that the concrete was failing in multiple locations, not just under the picnic table. 16. Mr. Barrett testified that he selected the concrete product that Respondent used on Complainant’s job because it was colored and easily repaired. He did not know why the concrete was flaking and suggested that it might be due to a product defect. 17. Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s prior disciplinary history on the Registrar’s public website. On this date, Respondent’s License No. ROC 239372 was current and in good standing. No prior discipline has 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.[3] 2. Complainant bears the burden of proof to establish cause to suspend or revoke Respondent’s license by a preponderance of the evidence.[4] Respondent bears the burden to establish factors in mitigation of the penalty and affirmative defenses by the same evidentiary standard.[5] 3. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[6] 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.”[7] 4. Because the parties’ agreement to modify their original contract did not include of the elements required by A.R.S. § 32-1158(A),[8] Complainant established cause to suspend or revoke Respondent’s contractor’s license under A.R.S. 32-1154(A)(12).[9] As a factor in mitigation of the penalty, Respondent’s original Construction Agreement with Complainant and his wife included all nine elements required by A.R.S. § 32-1158(A). Respondent’s subsequent violation appears due to an oversight. Because the violation is technical and not evidence indicated that Complainant was not harmed by the violation, no purpose would be served by requiring Respondent to submit its form proposals to the Registrar establish compliance with A.R.S. § 32-1158(A). 5. Based on Investigator Springer’s February 25, 2019 Directive and hearing testimony, Complainant established that Respondent’s construction of the two items on the Directive furnishes grounds to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32- 1154(A)(3),[10] namely A.A.C. R4-9-108.[11] 6. Respondent did not establish that the sealant it spread over the roof is an acceptable repair for a leak, that the colored concrete that it used on the slab was defective, or that, even if the product that it selected for the slab was defective, Complainant should be responsible for the defect. Therefore, Complainant also established that, although Respondent made some attempt to comply with the Directive, it did not correct the two items of construction to bring them within the Registrar’s and industry standards. Therefore, Complainant established cause to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(22).[12] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the final order in this matter, License No. ROC 239372 of Respondent Desert Meadow Construction Co. LLC shall be suspended for a period of three (3) business days. It is further recommended that the Registrar require Respondent to pay the sum of $250.00 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 final order, the Registrar shall 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 five (5) days from the date of that certification. Done this day, July 2, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] See A.A.C. R4-9-117 (“In any disciplinary proceeding conducted by the registrar, the licensee’s entire license file including the record of prior citations and decisions may be considered by the registrar in making a decision and order in the case.”). [2] See the Registrar’s electric file at 86-101. [3] See A.R.S. § 32-1154(A). [4] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [5] See A.A.C. R2-19-119(B)(2). [6] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [7] Black’s Law Dictionary at page 1220 (8th ed. 1999). [8] A.R.S. § 32-1158(A) provides that any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved after December 31, 2007 must be in writing and must include the following minimum terms: 1. The name of the contractor and the contractor’s business address and the license number. 2. The name and mailing address of the owner and the jobsite address or legal description. 3. The date the parties entered into the contract. 4. The estimated date of completion of all work to be performed under the contract. 5. A description of the work to be performed under the contract. 6. The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes. 7. The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner. 8. The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract. 9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar’s telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A. The information in this paragraph must be prominently displayed in the contract in ten point bold type. . . . [9] A.R.S. § 32-1154(A)(12) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” [10] 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.” [11] 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.” [12] 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.” (Emphasis added.)

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