FINACT2019A-02220-CHC-ROC-FinalAgencyAction-6602.pdf

2019A-02220-CHC-ROC · Registrar of Contractors · 2019-11-20

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Katherine Herrera, Case No. 2019-02220

COMPLAINANT, Docket No. 2019A-02220-CHC-ROC v.

Sun Valley Floor Specialists LLC FINAL ADMINISTRATIVE DECISION AND License No. ROC 293065, ORDER 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 modifies it as set forth below. The administrative law judge discussing the Respondent’s license record found that “Such prior License record also reflects that there were no other open complaints or prior complaints against Respondent’s license.” ALJ Decision page 4 lines 10-12. This is incorrect. According to the Registrar’s electronic file, there have been three prior complaints filed against Respondent’s license, all three of which are closed with no disciplinary action. The Registrar therefore modifies the Administrative Law Judge Decision to accurately reflect Respondent’s license history as shown in the Registrar’s electronic file. The administrative law judge found, and Investigator Smith testified, that at the compliance jobsite inspection Investigator Smith “observed that some repair work had been completed, but there were still bubbles in the flooring.” ALJ Decision page 3 lines 16-19. However, in the conclusions of law the decision

states that “Respondent did not attempt to complete the corrective work following the Directive being issued.”

of 4 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 ALJ Decision page 5 lines 9-10. That conclusion is contrary to the finding of fact that an unsuccessful attempt at correcting the deficient work occurred, and must be corrected. The Administrative Law Judge listed the charges from the citation, including possible violations of A.R.S. § 32-1154(A)(12) for failure to comply with A.R.S. § 32-1124(B) and A.R.S. § 32-1158. ALJ Decision page 3 lines 20-23. Under A.R.S. § 32-1124(B), licensed contractors must use the phrase “ROC” followed by their contractor’s license number on all bids or documents used to correspond with customers or potential customers. Additionally, A.R.S. § 32-1158 requires contractors to place specified information in all contracts, including the right of a client to file a complaint with the Registrar of Contractors, date of the contract, and estimated date of completion. The Administrative Law Judge found that a formal contract was not signed, and neither of the Respondent’s bids contained a license number, date of contract, date of completion, or an advisement that the client could file a complaint with the Registrar of Contractors. ALJ Decision page 2 lines 15-21. However, the charges for A.R.S. § 32-1154(A)(12), namely A.R.S. §§ 32-1124(B), -1158, are not addressed in the conclusions of law. The Registrar adds to the conclusions of law that the preponderance of the evidence demonstrated, in accordance with the findings of the Administrative Law Judge, that Respondent violated A.R.S. § 32-1154(A)(12) by failure to comply with A.R.S. §§ 32-1124(B) and 32-1158. CONCLUSION AND ORDER The Registrar modifies the Administrative Law Judge Decision as follows: • On page 4, line 11, replace “no other open complaints or prior complaints” with “no other open complaints and three prior complaints.” • On page 5, lines 9-10, replace the first sentence of paragraph five with “The evidence established that Respondent attempted to correct the workmanship deficiency, but was unable to. • Insert paragraph six on page five of the conclusions of law stating the following: “A preponderance of the evidence established that Respondent’s proposals did not contain the Respondent’s license number preceded by “ROC”, and that the proposals failed to include the date of the contract, the estimated date of completion, or an advisement that the client could

file a complaint with the Registrar of Contractors. Therefore, Complainant established that

of 4 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 Respondent failed to comply in a material respect A.R.S. § 32-1124(B) and A.R.S. § 32-1158 in violation of A.R.S. § 32-1154(A)(20).” • On page 6 after line 11, the Registrar inserts the following paragraph: “IT IS ORDERED that within thirty (30) days of the effective date of the final order, Respondent shall provide acceptable written proof to the Registrar that Respondent has modified its form proposal to include the required license information in accordance with A.R.S. § 32-1124(B) and form contracts to include all of A.R.S. § 32-1158 nine required terms. If Respondent fails to provide such acceptable written proof within such time period, Respondent’s contractor’s license shall be suspended until it does so.” The Registrar accepts the remainder of the Administrative Law Judge Decision, which becomes effective on December 15, 2019. IT IS FURTHER ORDERED that Respondent pay a civil penalty in the amount of $500.00 payable to the Registrar on or before 30 days from the effective date of this Order. If Respondent fails to pay the civil penalty by the specified date, Respondent’s license will be suspended until payment is received by the Registrar. Payment may be hand-delivered to the Registrar’s physical address or mailed to: Registrar of Contractors P.O. Box 6748 Phoenix, Arizona 85505-6748 FINAL NOTES • On page 2, line 25, replace “June 14, 2018” with “June 4, 2018.” • On page 6 line 10, replace “(A)(5)” with “(A)(7).”

Dated November 5, 2019. By: /s/ Joseph Citelli Joseph Citelli Chief Counsel Chief of Legal and Recovery Fund Arizona Registrar of Contractors ///

of 4 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 mailed via USPS First Class mail November 5, 2019 to: Respondent Sun Valley Floor Specialists LLC 5555 S Midvale Ave Tucson, AZ 85746 Complainant Katherine Herrera 15620 N Port Star Trl Tucson, AZ 85739

Copy sent electronically this same date to:

Office of Administrative Hearings Tammy L. Eigenheer, Administrative Law Judge Respondent at email address on record with the Registrar Complainant at email address on record with the Registrar

Case No. 2019-02220 / DE

of 4 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 10.8.2019 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Katherine Herrera, No. 2019A-02220-CHC-ROC COMPLAINANT v. ADMINISTRATIVE LAW JUDGE Sun Valley Floor Specialists LLC, DECISION ROC License: ROC 293065, RESPONDENT HEARING: September 9, 2019, with the record held open until September 16, 2019. APPEARANCES: Complainant Katherine Herrera appeared on her own behalf.

Edgar Verduzco, Qualifying Party, appeared on behalf of Respondent Sun Valley Floor

Specialists LLC.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

1. Sun Valley Floor Specialists LLC (Respondent) is the holder of License

No. 293065 issued by the Arizona Registrar of Contractors (Registrar).

2. On or about January 31, 2018, Katherine Herrera (Complainant) received a job proposal from Respondent to redo her concrete flooring for a total contract price of $11,966.00. Specifically, the job proposal detailed the job as follows: Concrete Surface Grinding to remove all seal and chips popping up Since there was a reaction on the floor do to the acid stain and concrete We will recommend concrete Surface grinding to remove all seal and places Were its coming off. Then neutralize whatever is happening in that concrete Ammonia. Let the floor dry 24hrs to 48hrs. Concrete Overlay Apply 3 coats of concrete on top of existing concrete after its properly prep and Neutralize. Very important to make sure we don’t have future problems. Apply any stain customer Choices. Seal with Acrylic Seal to make sure no dog scratches happen or damage to the New floor. All errors in original.

Office of Administrative Hearings 1740 West Adams Street, Lower Level Phoenix, Arizona 85007 (602) 542-9826 RECEIVED 10.8.2019 ROC LEGAL

3. On or about February 1, 2018, Complainant received a second job proposal from Respondent to redo her concrete flooring for a total contract price of $8898.39. Specifically, the job proposal detailed the job as follows:

Concrete Surface sanding to remove all seal and chips popping up Since there was a reaction on the floor do to the acid stain and concrete Sanding the floor and washing it with ammonia is a good way to go. Then neutralize whatever its happening in that concrete Ammonia. Let the floor dry 24hrs to 48hrs. Concrete Overlay Apply 3 coats of concrete on top of existing concrete after its properly prep and Neutralize. Very important to make sure we don’t have future problems. Apply any stain customer Choices. Seal with Acrylic Seal to make sure no dog scratches happen or damage to the New floor.

All errors in original.

4. Neither proposal mentioned any pre-existing conditions that would cause Respondent’s work to fail. 5. Complainant opted to accept the second job proposal. No formal contract was signed by the parties and the job proposals provided by Respondent did not included the date of the contract, an estimated date of completion, or an advisement that Complainant had the right to file a complaint with the Registrar if she was unsatisfied with the work performed. With each proposal was a concrete warranty and customer information sheet with “Sun Valley Floor Specialists” on the top of the page, but without Respondent’s ROC license number identified. 6. On or about April 30, 2019, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to the project. 7. The Registrar assigned the complaint to Investigator John Smith. On June 14, 2018, Investigator Smith conducted a jobsite inspection. At that time, Investigator Smith observed “numerous areas of chips in the flooring.” Investigator Smith stated that “[t]he chips start as bubbles below the surface, then they pop open leaving a divot in the floor.” Investigator Smith noted that Respondent referred to the areas as “bug holes.” RECEIVED 10.8.2019 ROC LEGAL

8. After the jobsite inspection, Investigator Smith issued a written directive to Respondent that provided as follows: 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 provide the Registrar with satisfactory written proof of your compliance with this Directive prior to 5:00 p.m. on June 24, 2019.

You are hereby directed to remedy the following violations by the appropriate means:

Complaint Item 1: “Concrete overlay failing.” The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action.

9. On or about July 10, 2019, after the deadline in the written directive, Investigator Smith conducted a compliance jobsite inspection. At the compliance jobsite inspection, Investigator Smith observed that some repair work had been completed, but there were still bubbles in the flooring. 10. The Registrar issued a Citation against Respondent, charging possible violations of 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. § 32-1124(B); A.R.S. § 32-1154(A)(12), namely A.R.S. § 32-1158; and A.R.S. § 32-1154(A)(22). 11. Investigator Smith testified at hearing that the proposals offered grinding or sanding, but neither gave any indication that there may be poor results. Investigator Smith also explained the Registrar’s policy that, absent a specific waiver by the homeowner, a contractor accepts the surface upon which it performs work. Investigator Smith also testified that he conducted a prehearing inspection on September 6, 2019, and at that time, he observed even more bubbles. RECEIVED 10.8.2019 ROC LEGAL

12. Complainant testified that the spots on the floor were still appearing at the time of the hearing and that she just wanted to move on from this. 13. Edgar Verduzco, Qualifying Party, testified that Respondent did

everything per the instructions for the materials used. Mr. Verduzco stated that the

moisture check was negative, so Respondent did not believe there would be any

problem with the project. Mr. Verduzco asserted that Respondent’s floor was not

failing, but the subfloor was failing.

14. Administrative notice is taken of Respondent’s prior License record on

October 7, 2019. Such prior License record reflects that Respondent’s License No.

293065 was first issued on June 26, 2014, and is current. Such prior License record

also reflects that there were no other open complaints or prior complaints against

Respondent’s license.

CONCLUSIONS OF LAW

1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. 2. Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41- 1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960). 3. As a general principle in construction, a contractor who performs work on top of a surface prepared by another accepts the surface. The contractor should have inspected the surface for any flaws or defects that would affect the work he proposes before performing the work. If he found the surface to be unacceptable, he should have called any defects to the owner’s attention so that the owner can choose whether to pay for the defective surface to be corrected or if the owner is not willing to pay to

RECEIVED 10.8.2019 ROC LEGAL

correct the surface, the subsequent contractor may obtain an explicit warranty disclaimer.1 4. Whether the issue with the concrete overlay was the result of the subfloor

or of Respondent’s application of the material, Respondent was responsible for the

defects results. The evidence established that Respondent’s work was not in

conformity with the Registrar’s standards. Therefore, Complainant established that

Respondent did not complete the project in a workmanlike manner in violation of A.R.S.

§ 32-1154(A)(3), namely A.A.C. R4-9-108.2

5. The evidence established that Respondent did not attempt to complete

the corrective work following the Directive being issued. Therefore, Complainant

established that Respondent failed to take appropriate corrective action following a

written directive from the Registrar in violation of A.R.S. § 32-1154(A)(22).3

RECOMMENDED ORDER

No Arizona authority addresses the Registrar’s policy that a subsequent contractor who accepts an existing surface also accepts full responsibility for the outcome. The policy is supported by case law from other jurisdictions. See generally cases cited at “Duty of Contractor to Warn Owner of Defects in Subsurface Conditions,” 73 A.L.R.3d 1213 (1976). A contractor who knew or should have known of a defect in the surface does not perform construction in a workmanlike manner if the contractor fails to notify the owner of the defect and the construction later fails due to the defective surface. See, e.g., Parker v. Thornton, 596 So. 2d 854, 858 (Miss. 1992); Lewis v. Anchorage Asphalt Paving Co., 535 P.2d 1188, 1199 (Alaska 1975). The principle is based on common sense and a need for fair dealings between contractors and property owners:

For the requirements of public order and the obligation implicit in every contract that the work will be done in a good and workmanlike manner would compel us to reject a contention that an undertaker is not responsible for building upon a site which he knows to be defective. In such a case, the barest standards of care would require him to bring the defect to the attention of the owner before proceeding. The owner would then have an opportunity to make the indicated adjustment in the contract to provide against the defective soil condition of which he had no prior knowledge. . . . Wurst v. Pruyn, 202 So. 2d 268, 271-72 (La. 1967) (citation omitted). 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 10.8.2019 ROC LEGAL

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent’s License No. 293065 for a period of three days.

It is further recommended that the Registrar require Respondent to pay the sum

of $500.00 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 Registrar’s final

order, the Registrar 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

40 days from the date of that certification.

Done this day, October 7, 2019.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors