FINACT2019A-04104-CHC-ROC.pdf

2019A-04104-CHC-ROC · Registrar of Contractors · 2020-02-10

REGISTRAR OF CONTRACTORS OF THE STATE OF ARIZONA

Lance A Wagner, Case No. 2019-04104 COMPLAINANT, Docket No. 2019A-04104-CHC-ROC v. Unique Flooring LLC, FINAL ADMINISTRATIVE License No. ROC 325681, 296426, DECISION AND 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 and modifies it as set forth below. The Administrative Law Judge found that Respondent “established that it was unable to comply with the Directive due to Complainant’s refusal to let Respondent on his property.” ALJ Dec. 7:23-24. The Administrative Law Judge noted that “[d]enial of access constitutes a valid justification for failing to comply with a written directive of the ROC,” ALJ Dec. 7:25- 26, and that Respondent therefore “cannot properly be disciplined for the violation of A.R.S. § 32-1154(A)(22).” ALJ Dec. 8:1-2. Despite this finding, the Administrative Law Judge recommended that Respondent’s license be disciplined for a violation of A.R.S. § 32- 1154(A)(3). ALJ Dec. 7:22; 8:5-6.

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 Because Complainant denied Respondent the opportunity to correct its work prior to the Directive deadline, Respondent’s license should not be disciplined for a violation of A.R.S. § 32-1154(A)(3). Construction is not a perfect art, and, generally, homeowners are required to allow contractors access to attempt to complete and correct their work before the Registrar will suspend or revoke a license. A homeowner’s failure to provide reasonable access for a contractor to comply with a directive issued by the Registrar is an affirmative defense that the contractor bears the burden to establish. Here, Respondent established that Complainant “kicked Respondent out of his house,” “refused to let [Respondent] back on his property to correct the issues,” and “refus[ed] to let Respondent on his property.” See ALJ Dec. 4:21-24; 5:10-21; 7: 23-24. Therefore, the Administrative Law Judge’s recommended order must be modified because Complainant did not permit Respondent to attempt to correct its work. CONCLUSION AND ORDER On page 8, lines 4-6, replace the Recommended Order with, “IT IS ORDERED that, on the effective date of this Order, this matter be closed as dismissed.” The Registrar accepts the remainder of the administrative law judge’s decision, which becomes effective on March 14, 2020. Dated February 3, 2020. 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 February 3, 2020 to: Respondent Unique Flooring LLC 621 N Lake Havasu #102 Lake Havasu, AZ 86403

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

Complainant Lance A Wagner 3765 Surrey Hills Ln Lake Havasu City, AZ 86404

Copy sent electronically this same date to:

Office of Administrative Hearings Antara Nath Rivera, Administrative Law Judge

Respondent at email address on record with the Registrar Complainant at email address on record with the Registrar Case No. 2019-04104/tw

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 1.6.2020 ROC LEGAL

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Lance A Wagner, No. 2019A-04104-CHC-ROC COMPLAINANT v. ADMINISTRATIVE LAW JUDGE Unique Flooring LLC, DECISION ROC License: ROC 325681, 296426, RESPONDENT HEARING: December 20, 2019 APPEARANCES: Lance Wagner, Complainant, appeared on his own behalf. Kristen Arguello appeared on behalf of Unique Flooring LLC, Respondent. ADMINISTRATIVE LAW JUDGE: Antara Nath Rivera _____________________________________________________________________ FINDINGS OF FACT 1. On or about March 6, 2015, the Registrar of Contractors (“ROC”) issued License No. 296426 for Specialty Dual CR-60 Finish Carpentry and License No. 325681 for Specialty Dual CR-48 Ceramic, Plastic, and Metal Tile to Unique Flooring LLC (“Respondent”). Respondent’s address of record for the licenses is 621 North Lake Havasu Avenue, Lake Havasu, AZ 86403. Daniel Duane Oller is listed on the license as Qualifying Party and Kristen Nicole Arguello is listed on the license as Member. 1 2. Administrative Notice is taken of Respondent’s prior License record, for License Nos. 296426 and 325681, as reflected on the ROC’s public website on December 20, 2019. Such prior License record reflects that both license numbers are currently active. License number 296426 has been disciplined by the ROC on three cases. The record also reflects that License number 325681 has one open complaint against Respondent’s license, which is presumed to be related to this matter. For both License numbers, Respondent has an active $18,000.00 surety bond issued through Western Surety Company.2 3. On or about February 8, 2019, Lance Wagner (“Complainant”) entered into a written contract whereby Respondent agreed to install granite countertops at 1See https://roc.az.gov/contractor-search?Id=a0Yt000000EJdtdEAD and https://roc.az.gov/contractor- search?Id=a0Yt000000ACMgAEAX. Id. RECEIVED 1.6.2020 ROC LEGAL

Complainant’s residential property located at 3765 Surry Hills Lane, Lake Havasu City, AZ 86404 for the sum total of $10,500.00. The project commenced on February 8, 2019. Complainant paid Respondent a total $5,250.00 by the time Respondent stopped working on the date of August 1, 2019. 4. On or about August 13, 2019, the ROC received a workmanship complaint from Complainant which included a copy of the contractual agreement between the parties. 5. On or about August 20, 2019, the ROC issued a Jobsite Inspection Notification letter to the parties, providing proper notice to them, and advising that an onsite review would be conducted at the project site by an ROC investigator on September 4, 2019, at 9:00 a.m. 6. On or about September 4, 2019, ROC Investigator Cliff Corlett (“Investigator Corlett”) conducted a review of the contract executed between the parties. Investigator Corlett also inspected the work that had been done on the project to date and took approximately 50 photographs. Respondent was not present during the inspection. 7. On or about September 25, 2019, Investigator Corlett issued a Directive from the Registrar (“Directive”) to Respondent because he substantiated Complainant’s allegation that Respondent’s work failed to meet minimum ROC workmanship standards. Specifically, Respondent was ordered to remediate complaint items 1-6, 9-13, and 15-16 via appropriate means. Respondent was put on notice that it had until October 14, 2019, to notify the ROC of its compliance with the corrective order or face discipline pursuant to ARIZ. ADMIN. CODE R4-9-108, and ARIZ. REV. STAT. § 32-1154(A)(22) and 32-1154(E).3 8. On or about October 7, 2019, Respondent contacted Investigator Corlett and indicated that Complainant would not allow access to Respondent to correct the issues. Respondent sent multiple emails to Investigator Corlett, through October 15, 2019, reiterating Complainant’s continued denial of access. 9. On or about October 15, 2019, the ROC issued a Citation to Respondent for alleged violations of ARIZ. REV. STAT. § 32-1154(A)(3) and 32-1154(A)(22), and ARIZ.

3 See ROC Hearing packet, Bates page 47-50.

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ADMIN. CODE R4-9-108. Respondent was given until November 1, 2019, to respond with its Answer or face discipline pursuant to ARIZ. REV. STAT. § 32-1154(A)(22) and 32-1155. 10. On October 23, 2019, the ROC referred this matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing on December 20, 2019. Per the Notice of Hearing, the issue to be determined was whether the ROC had cause to discipline Respondent’s license based on the following charges: Charge: 1 A.R.S. § 32-1154(A)(3) - R4-9-108 Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108. Charge: 2 A.R.S. § 32-1154(A)(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. The written directive shall set forth the time within which the contractor is to complete the remedial action. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive. A license shall not be revoked or suspended nor shall any other penalty be imposed for a violation of this paragraph until after a hearing has been held. HEARING EVIDENCE 1. Investigator Corlett testified that the kitchen granite was installed incorrectly with over hangs, uneven colors and seams, and incorrect sizing. Furthermore, the bathroom sink was installed backwards preventing proper drainage. Investigator Corlett stated that Complainant did not allow Respondent back in his house because of Respondent’s incapability. Respondent made attempts to perform corrective work. 2. At hearing, Complainant testified that after he entered into the contract with Respondent, in January 2019, he was told to go to Las Vegas, by Respondent, to pick out granite. After he selected the granite, Mr. Oller and Respondent’s employee, Victor Arguello, went to Complainant’s home to take measurements. Complainant was told the project would take approximately 10-12 weeks. 3. In March 2019, Complainant contacted Respondent to inquire about the status of the granite order. 4. In May 2019, Respondent began work on the project. Complainant was out of town when Mr. Arguello installed the two of the four pieces of granite. Complainant’s friend was present the day of the installation and informed Complainant that Mr. Arguello 3 RECEIVED 1.6.2020 ROC LEGAL

did not install the granite properly and that there was excess glue. That same day, Complainant instructed his friend to clean off excess glue. 5. Upon his return, Complainant observed that the granite installation had uneven seams, wrong color seam epoxy, uneven edges, and other inconsistencies. Complainant notified Respondent. A few days later, Mr. Arguello met with Complainant. Mr. Arguello had no explanation for the inconsistencies. Mr. Arguello told Complainant that he had the remaining two slabs of granite and offered to return the slabs as well as Complainant’s money. Complainant threatened to sue Respondent. Immediately, Mr. Arguello drafted a second contract whereby Respondent would install new sub tops over the current sub tops. 6. In July 2019, Complainant called Respondent to begin the second part of the project per the newly drafted contract. In the end of July, Mr. Arguello came to Complainant’s home with the peninsula. Mr. Arguello was unable to lift the peninsula. Complainant’s friend, who was a carpenter, assisted Mr. Arguello. 7. On or about July 31, 2019, Complainant went out of town. Mr. Arguello completed the installation. 8. In the beginning of August 2019, after Complainant returned, he noticed holes that were drilled in the granite in the wrong location. Complainant contacted Respondent. Mr. Oller responded and stated that he was unable to fix the holes and alleged that Complainant defaced the granite. When Complainant also pointed out that the bathroom sink was installed backwards, Mr. Oller stated that those sinks were normally installed in that manner. Complainant became upset and kicked Respondent out of his house after that meeting and filed the Complaint. 9. Complainant acknowledged that he did not want Mr. Arguello back on his property because he did not want further damage to his kitchen or bathroom. 10. At hearing, Ms. Arguello presented the testimony of Mr. Arguello. Mr. Arguello testified that he installed the granite at Complainant’s home. He stated that he was the only employee who installed granite. Mr. Arguello acknowledged that he informed Complainant that he had the two remaining slabs Complainant ordered and offered to give Complainant his money back. Mr. Arguello did not install the bathroom sink 4 RECEIVED 1.6.2020 ROC LEGAL

backwards. Complainant never complained of anything until after the installation was completed. 11. Ms. Arguello testified that while Respondent worked on the project, Complainant altered Respondent’s work. Respondent informed Complainant to leave the sub tops alone so that it could properly finish the work. Ms. Arguello acknowledged that that Mr. Arguello was Respondent’s only employee who installed granite. She also acknowledged that there were issues with the granite and the installation thereof. However, Respondent was made aware of Complainant’s discontent after the Complaint was issued. 12. Once the ROC became involved, Complainant refused to let Mr. Arguello back on his property to correct the issues. Ms. Arguello explained to Complainant that Mr. Arguello was the only one who could correct the issues for Respondent. Respondent tried to set up appointments to repair everything but Complainant refused to let Mr. Arguello in his house. 13. After the Directive was issued, Respondent contacted Complainant again to correct the issues. Complainant never responded to Respondent. Before the compliance deadline, Complainant emailed Respondent with a list of reasons why Mr. Arguello was not allowed on his property. Complainant also told Respondent that he received additional bids for completion of the project and wanted attorney fees. Complainant refused to let Respondent correct the issues. Respondent emailed Investigator Corlett and informed him that Complainant denied it access to his property. Complainant also never paid Respondent, in full, for the completed work. CONCLUSIONS OF LAW 1. The ROC has jurisdiction over this matter pursuant to ARIZ. REV. STAT. § 32- 1101 et seq. and 32-1154(A). The matter was properly brought before the Office of Administrative Hearings pursuant to ARIZ. REV. STAT. § 41-1092 et seq.

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2. The ROC may resolve contractual disputes if such resolution in ancillary to its regulatory mission and may penalize a contractor’s license by ordering payment of restitution if a proven statutory violation was not remedied by corrective action.4 3. The purpose of the ROC’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors.5 4. Complainant bears the burden of proof to establish cause to discipline Respondent’s license by a preponderance of the evidence.6 Respondent bears the burden to establish factors in mitigation of the penalty and affirmative defenses by the same evidentiary standard.7 5. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”8 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.”9 7. ARIZ. ADMIN. CODE 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.” 8. ARIZ. REV. STAT. § 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.” 9. ARIZ. REV. STAT. § 32-1154(A)(22) holds, in pertinent part, that “[a] holder of a license may not fail to take appropriate corrective action to comply with this chapter or

See ARIZ. REV. STAT. § 32-1156.01; Sunpower of Arizona v. Arizona Registrar of Contractors, 166 Ariz.

437, 441, 803 P.2d 430, 434 (App. 1990). See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995). 6 ARIZ. REV. STAT. § 41-1092.07(G)(2); ARIZ. ADMIN. CODE R2-19-119(B)(1); see also Vazanno v. Superior

Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). 7 See ARIZ. ADMIN. CODE R2-19-119(B)(2). MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960). 9 BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999).

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rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar. The written directive shall set forth the time within which the contractor is to complete the remedial action. The time permitted for compliance shall not be less than fifteen days from the date of issuance of the directive. A license shall not be revoked or suspended nor shall any other penalty be imposed for a violation of this paragraph until after a hearing has been held. The ROC has the authority to issue license discipline under this provision, including summary suspension, revocation, or imposing a civil penalty or recovery fund award.” 10. ARIZ. REV. STAT. § 32-1154(E) holds, in pertinent parts, that the ROC may “[i]mpose a civil penalty not to exceed five hundred dollars on a contractor for each violation. The failure by the licensee to pay any civil penalty imposed results in the automatic revocation of the license thirty days after the effective date of the order providing for the civil penalty. It also holds that no future license may be issued to an entity consisting of a person who is associated with the contractor, unless payment of any outstanding civil penalty is tendered.” 11. Complainant established, by a preponderance of the evidence that the work Respondent completed fell below the ROC’s minimum workmanship standards. Respondent was hired to install granite countertops. Respondent had one employee who could install any and all granite work. Not only did Mr. Arguello, Respondent’s only employee, need assistance with carrying the granite, Mr. Arguello incorrectly installed the countertops. Respondent acknowledged that there were issues with the workmanship and were willing to correct these issues. Thus, 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. 12. Respondent, however, established that it was unable to comply with the Directive due to Complainant’s refusal to let Respondent on his property. 13. Denial of access constitutes a valid justification for failing to comply with a written directive of the ROC. Respondent established by a preponderance of the evidence that it contacted Complainant, on multiple occasions, to complete the project per the Directive. The evidence established that Complainant denied it access to his property when he explicitly refused to allow Respondent’s only employee back on his property to 7 RECEIVED 1.6.2020 ROC LEGAL

complete the project as directed. Therefore, Respondent cannot properly be disciplined for the violation of A.R.S. § 32-1154(A)(22). RECOMMENDED ORDER Based on the foregoing, IT IS RECOMMENDED that on the effective date of the Order, the Registrar of Contractors shall suspend Respondent’s License Nos. 325681 and 296426 for a period of three (3) days. 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, January 6, 2020.

/s/ Antara Nath Rivera Administrative Law Judge Transmitted electronically to: Jeffrey Fleetham, Director Registrar of Contractors

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