FINACT2019A-01676-CHC.pdf

2019A-01676-CHC-ROC · Registrar of Contractors · 2019-12-04

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Bel Aire Construction LLC, Case No. 2019-01676 COMPLAINANT, Docket No. 2019A-01676-CHC-ROC v. FINAL ADMINISTRATIVE FEZ Construction LLC, DECISION AND ORDER License No. ROC 285577, 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 of each finding of fact or conclusion of law. MODIFICATION AND WRITTEN JUSTIFICATION 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 modified it. The Registrar modifies the Administrative Law Judge’s recommended order that “License No. ROC 285577 of Respondent FEZ Construction LLC shall be suspended for a period of five (5) business days.” Contracting services rendered by Respondent are not limited to weekdays only. Therefore, calendar days are more appropriate. CONCLUSION AND ORDER On page six, line 22, “business days” should be “calendar days.” The Registrar accepts the remainder of the Administrative Law Judge’s Decision, which becomes effective on January 11, 2019.

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. – Ste. 105 – Phoenix, AZ 85007-2812 Telephone (602) 542-1525 Toll Free (877) 692-9762 Lg131 8/19 IT IS FURTHER ORDERED that Respondent pay a civil penalty in the amount of $250.00 payable to the Registrar on or before 30 days from the effective date of this Order. Payment may be hand-delivered to the Registrar’s physical address or mailed to: Registrar of Contractors P.O. Box 6748 Phoenix, AZ 85505-6748 FINAL NOTE On page one, paragraph one, line 21, “contracting” should be “Contractor.” On page one, paragraph two, line 25, “contracting” should be “Contractor.” On page two, paragraph nine, line 26, “stepson” should be “stepson or son-in-law.” On page three, paragraph 11, line six, “son-in-law” should be “stepson or son-in-law.” On page six, paragraph five, line one, “June” should be “June or July.” On page seven, line five, “(A)(5)” should be “(A)(7).” Dated December 2, 2019. By: /s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal Department and Recovery Fund Arizona Registrar of Contractors

Copy mailed via USPS First Class Mail December 2, 2019 to: Respondent FEZ Construction LLC 6520 E Calle De Las Estrellas Cave Creek, AZ 85331

Complainant Bel Aire Construction LLC 10632 N Scottsdale Rd Ste B Scottsdale, AZ 85254 Complainant’s Attorney Denise H. Troy, Esq. Dickinson Wright PLLC 1850 N Central Ave Ste 1400 Phoenix, AZ 85004

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. – Ste. 105 – Phoenix, AZ 85007-2812 Telephone (602) 542-1525 Toll Free (877) 692-9762 Lg131 8/19 Copy sent electronically this same date to: Office of Administrative Hearings Diane Mihalsky, Administrative Law Judge Respondent at email address on record with the Registrar Complainant at email address on record with the Registrar Complainant’s Attorney at email address of record with Registrar Case No. 2019-01676 / KR

of 3 REGISTRAR OF CONTRACTORS 1700 W. Washington St. – Ste. 105 – Phoenix, AZ 85007-2812 Telephone (602) 542-1525 Toll Free (877) 692-9762 Lg131 8/19 RECEIVED 11.7.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Bel Aire Construction LLC, No. 2019A-01676-CHC-ROC

COMPLAINANT, ADMINISTRATIVE LAW JUDGE DECISION v.

FEZ Construction LLC, License No. ROC 285577,

RESPONDENT.

HEARING: October 31, 2019, at 8:30 a.m. APPEARANCES: Bel Aire Construction LLC (“Complainant”) was represented by Denise H. Troy, Esq., Dickinson Wright PLLC; FEZ Construction LLC (“Respondent”) appeared through Jasper Nichols, 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, on or about June 10, 2013, the Registrar issued License No. ROC 285577 for General Dual KB-2 Dual Building contracting to Respondent. Respondent’s Member/ Qualifying Party is Jasper Nichols. 2. On or about December 11, 2007, and December 12, 2007, the Registrar issued License Nos. ROC 240252 for General Commercial A General Engineering and ROC 240253 for General Residential B Contracting to Complainant. Complainant’s member/qualifying party is Jeff Labriola. 3. On or about April 4, 2019, Mr. Labriola on behalf of Complainant filed a complaint with the Registrar against Respondent that alleged that, between June 6, 2017, and August 20, 2017, it had installed large double wrought iron gates at Mr.

Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 11.7.2019 ROC LEGAL

Labriola’s house at 12037 N. 56th Street, Scottsdale, Arizona 85254, and that the powder coat finish on the gates was failing. 4. The Registrar assigned the complaint to its Investigator, Steve Klein, for

investigation. On or about May 23, 2019, Investigator Klein performed a jobsite

inspection. On May 24, 2019, Investigator Klein on behalf of the Registrar issued a

directive to Respondent, requiring it to perform certain corrections prior to June 10,

2019, at 5:00 p.m., in relevant part as follows:

Complaint Item 1: Powder coat is coming off both gates. Verified peeling and exposed metal in several areas.

Investigator Klein amended the directive to give Respondent more time to perform

repairs.

5. On July 1, 2019, Investigator Klein performed a compliance jobsite

inspection. His notes of his inspection stated that, although Respondent had attempted

corrections, “patched areas are noticeable” and “didn’t blend well with existing finish.” 6. On July 2, 2019, Investigator Klein referred the complaint to the Registrar’s Legal Department. On July 3, 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). 7. Respondent filed a timely written answer to the Citation, denying any statutory violations. 8. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. 9. An evidentiary hearing was held on October 31, 2019. Complainant submitted three exhibits and presented Mr. Labriola’s testimony. Respondent submitted four exhibits presented the testimony of Mr. Nichols and Brian Cose, Mr. Nichols’ stepson and the owner of Mind Over Metal, which had fabricated the gates that Respondent installed. Investigator Klein also testified. HEARING EVIDENCE 10. On or about April 19, 2017, Respondent contracted to install the entrance gates at the house that Complainant was constructing at 12037 N. 56th Street, RECEIVED 11.7.2019 ROC LEGAL

Scottsdale, Arizona 85254. The gate was to be “sand blasted and powder coated.”1 On or about May 22, 2017, Respondent contracted to install several other gates at the property. Respondent’s contractor’s license number was on the contracts, along with

the names, “FEZ Construction—Mind Over Metal.”2

11. Mind Over Metal fabricated the gates. Mind Over Metal is operated by Mr.

Nichols’ son-in-law, Mr. Cose, and fabricates many of the wrought iron gates that

Respondent installs in its contracting business. Mind Over Metal does not have a

contractor’s license.

12. Mr. Labriola testified that the house has 17,000 square feet and is a

multimillion dollar home. Although he moved into the house after it was constructed, he

is planning to sell the property.

13. Mr. Labriola testified that, a year after Respondent installed the entry gate,

the powder coat began failing.

14. Investigator Klein testified that the finish on the gates was popping and

peeling in a couple areas. Investigator Klein testified that, although repairs had been

performed on the affected area, the repairs did not blend in with the surrounding area.

15. Mr. Labriola testified that the repairs appeared to be textured and the surrounding area was smooth. 16. Investigator Klein testified that, at a minimum, contractors should go edge to edge to repair finished surfaces. Investigator Klein testified that Respondent’s repairs to the gates did not meet the Registrar’s minimum workmanship standards. 17. Mr. Cose testified that he used the product recommended by the paint manufacturer to repair the powder coat on the gates. Mr. Nichols testified that, after two years, the finish on the gates had begun to oxidize. 18. Mr. Cose testified that, on or about July 13, 2018, Mr. Labriola told him and two of his workers that a car had gotten pinched in the gate and damaged it, causing the panels to flex and bend approximately ¼” and causing a vertical crack that was 6’ –

See Complainant’s Exhibit 1A. 2 See Complainant’s Exhibit 1. RECEIVED 11.7.2019 ROC LEGAL

8’ long. Mr. Cose testified that shortly after the accident occurred, he cut the gates loose and re-welded the hinges on gates so that they would be operable. 19. Respondent submitted a text that Mr. Cose sent on May 24, 2019,

recounting the alleged conversation with Mr. Labriola about the July 13, 2018 accident.

Respondent also submitted photographs that Mr. Cose took in June or July 2019, when

it performed repairs to the gates, which Mr. Cose testified showed damages to the

gates from the July 2018 accident, including alleged stress on the vertical metal

components of the gates.3

20. Respondent also submitted notarized written statements from Mind Over

Metal’s employee Daniel Lee that, on September 22, 2017, Mr. Labriola told Mr. Cose

and him that one of Mr. Labriola’s friends had his car “pinched” by the gates and that

he spent two hours readjusting the gates.4

21. Mr. Labriola denied that the gate had ever been damaged in an accident.

He testified that on September 21, 2017, a car had hit the block wall and that

Respondent performed unrelated warranty work on the gate the next day. Respondent

submitted the accident report.5

22. Investigator Klein testified that, if the gates had been hit by a car, he would expect to see a ding or scratch on the gates. Investigator Klein testified that it was not that he did not believe Mr. Cose and Mr. Nichols, but that he did not see any of the usual signs on the gate that would indicate that it had been hit or damaged by a vehicle. 23. After Respondent installed the gate, Complainant installed an automatic gate opener. Mr. Nichols testified that the gate opener should have been separately permitted and inspected, but that the City of Phoenix permitting record did not include a separate permit or record of inspection for the gate opener.6 Mr. Nichols did not explain how the automatic gate opener caused the powder coat on the gates to fail.

See Respondent’s Exhibit 1 at 1. See id. at 14. See Complainant’s Exhibit 2. 6 See Respondent’s Exhibits 3 and 4. RECEIVED 11.7.2019 ROC LEGAL

24. Mr. Labriola testified that the property passed all inspections necessary for a Certificate of Occupancy. Mr. Labriola testified that the City of Phoenix did not require a separate permit or inspection for the automatic gate opener.

25. 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. Complainant alleged only that the powder coating on the entry gates was failing, not that the gate was bent. Investigator Klein credibly testified that Respondent’s repairs to the powder coating did not match the surrounding area and did not comply with the Registrar’s minimum standards.

See A.R.S. § 32-1154(A). 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, Ariz. 369, 372, 249 P.2d 837 (1952). See A.A.C. R2-19-119(B)(2). MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960). 11 BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999). RECEIVED 11.7.2019 ROC LEGAL

5. Respondent’s photographs of the gates taken in June 2019, when it attempted to repair the powder coating on the gates, do not show any damage to the gates that would cause the powder coating to fail. Mr. Daniels’ statement indicated that

the alleged accident involving the gate occurred on September 21, 2017, but Mr.

Cose’s text stated that the accident occurred on July 13, 2018. Respondent did not

establish that the alleged accident in September 2017, or July 2018, involving a car

getting “pinched” in the gate caused the powder coating on the gates to fail.

6. Respondent did not establish the automatic gate opener that Complainant

installed caused the powder coating on the entry gates to fail.

7. A.R.S. § 32-1155(A) requires licensed contractors in Arizona to provide a

warranty that their work will continue to meet the Registrar’s workmanship standards for

at least two years after the work is performed, with certain exceptions that are not

relevant here. Because Complainant established that the powder coating on the entry

gates failed less than two years after Respondent installed the gates and Respondent

did not establish that the failure was due to any other factor that was beyond

Respondent’s control, Complainant established cause to suspend or revoke

Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3),12 namely, A.A.C. R4- 9-108,13 and A.R.S. § 32-1154(A)(22).14 RECOMMENDED ORDER Based on the foregoing, IT IS ORDERED that on the effective date of the final order in this matter, License No. ROC 285577 of Respondent FEZ Construction LLC shall be suspended for a period of five (5) business days. IT IS FURTHER ORDERED imposing a civil penalty on Respondent’s license in the amount of $250.00 under A.R.S. § 32-1154(E). 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.” 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.” 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.” RECEIVED 11.7.2019 ROC LEGAL

IT IS FURTHER ORDERED 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 days from the date of that certification.

Done this day, November 6, 2019.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to: Jeffrey Fleetham, Director Registrar of Contractors