ALJDEC decisions subject to certification as final

2019A-05347-CHC-ROC · Registrar of Contractors · 2020-03-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Kathryn L Del Real,

COMPLAINANT,

v.

Cityluxe Companies LLC, DBA: AZ’s Best Roofing,

License No. ROC 286561,

RESPONDENT.

No. 2019A-05347-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 2, 2020, at 9:00 a.m.

APPEARANCES: Kathryn L. Del Real (“Complainant”) was represented by Patrick D. White, Esq., Jennings, Strouss & Salmon, PLC; Cityluxe Companies LLC DBA: AZ’s Best Roofing (“Respondent”) appeared through Don Marvin McElwain, its Qualifying Party/Member.

ADMINISTRATIVE LAW JUDGE: Diane Mihalsky

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

According to the Arizona Registrar of Contractors’ (“the Registrar’s”) public website, on or about September 3, 2013, the Registrar issued License No. ROC 286561 for General Dual KB-1-Dual Building Contracting to Respondent.

On or about October 25, 2019, Complainant filed a complaint with the Registrar against Respondent that alleged that it had performed poor work on its contract to repair the flat roof on her home at 4543 E. Vermont Avenue, South, Phoenix, Arizona 85018.

On or about November 20, 2019, the Registrar’s Investigator Randy Morris sent a Jobsite Inspection Notice to Respondent at its address of record and to its email address, informing it that he would conduct a jobsite inspection on December 11, 2019, at 9:30 a.m.

Investigator Morris conducted a jobsite inspection on December 11, 2019, at 9:30 a.m. Complainant attended the jobsite inspection. Respondent’s qualifying party/member, Don Marvin McElwain, and its employee, Danny Ryan, attended the jobsite inspection on its behalf.

On December 18, 2019, Investigator Morris on behalf of the Registrar issued a Directive, requiring Respondent to correct by appropriate means some of its repairs to the roof on or before 5:00 p.m. on January 8, 2020, in relevant part as follows:

Complaint Item 2: “Per the inspection dated 9/24/19 by United Central Roofing, the work done by AZ Best Roofing was completely incorrect rendering the roof un-repairable necessitating replacement of the entire roof.” (NOTE: during the job site inspection, it was determined that the Complainant is referring to poor workmanship of the repairs on the roof made by the Respondent)

Investigator’s Observation: Of the remaining work performed by the Respondent on the roof per the contract, it was noted that the repairs do not meet the minimum workmanship standards or industry standards as the coating and repair materials are failing (coating is peeling up and the asphaltic repair material is cracking excessively after less than one year). Allegation is verified.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item 1: “This complaint is being made due to negligence by AZ Best Roofing that resulted in additional damages to my roof and interior of my home (please see attached timeline with exhibits)”

Investigator’s Observation: During the job site inspection the Complainant stated that all of the water damage had been repaired prior to the inspection. The Complainant also stated that that section of roof (over the bedrooms) had been repaired by other contractors (House Doctors and Gurr Brothers). As a result of the repairs made by other contractors, the ROC cannot hold the Respondent responsible for their work or alleged damage to the roof and interior of the home since their work has been modified. The section of the roof over the bedrooms is no longer the responsibility of the Respondent. Allegation is not verified.

Governing Rule: A.R.S. § 32-1155(D)(2). The Respondent’s work was subject to neglect, modification, or abnormal use. For that reason, the Registrar is prohibited from issuing a citation for the Respondent’s alleged poor workmanship or alleged departure from applicable building codes.

The Registrar sent the directive to Respondent at its address of record and email address.

Investigator Morris did not perform a compliance inspection because both parties agreed that Respondent had not performed any repairs to comply with the directive.

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).

Respondent filed a timely written answer to the Citation, denying any statutory violations.

The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing.

An evidentiary hearing was held on March 2, 2020. Complainant submitted sixteen exhibits and presented the testimony of two witnesses: (1) Herself; and (2) Steven Sellers, the qualifying party of Steven Louis Sellers DBA: United Central Roofing, License No. ROC 194954 for Specialty Dual CR-42 Roofing. Respondent submitted one exhibit and presented the testimony of two witnesses: (1) Don Marvin McElwain, Respondent’s qualifying party/member; and (2) Danny Ryan, Respondent’s employee who had performed the repairs to Complainant’s roof. Investigator Morris also testified.

Hearing evidence

During the spring and early summer of 2018, Complainant solicited bids from licensed contractors to repair the flat foam roof on her home.

On or about March 21, 2018, Mr. Sellers on behalf of United Central Roofing submitted a bid in the amount of $8,560.00 to repair and recoat the existing roof on Complainant’s house, in relevant part as follows:

1) Remove all dirt and debris from the roof’s surface

2) Power-wash the existing roof surface as required. Allow 24 hours to dry.

3) *Cut out all blisters – fill blisters with foam and properly grind down.

4) Grid and fill all holes in the parapet walls using acrylic mastic.

5) On areas where large cracks/splits are occurring on the foam – cut and fill with acrylic mastic and 3-course with polyester fabric and coating.

6) Install three (3) gallons per square (100 ft.) of white elastomeric roof coating – in two (2) separate 1.5 gallon/ square coats. (This will yield approx. 30-35 dry mils thickness) Allow 24 hrs. to dry between coats.

7) Clean and restore job site to its original condition.

8) Furnish Tropical Roof Coating 10 yr. Limited Material Only Warranty.

*At three (3) areas on the SE side of the roof install polyester fabric to reinforce the coating. (approx. 450 sq. ft. – See Roof Drawing)

Mr. Sellers testified that, at the time, the roof only required maintenance and that the blisters could have been repaired by cutting out the blisters and re-foaming the area.

Complainant did not accept Mr. Sellers’ bid. Mr. Sellers testified that, if Complainant had accepted his bid and he had performed the repairs, he would have been able to provide a ten-year limited manufacturer’s warranty.

On or about July 14, 2018, Respondent emailed a proposal to repair Complainant’s roof for a total price of $4,500.00, in relevant part as follows:

[E]stimate for 4543 East Vermont Avenue Phoenix Arizona complete rubber system on flat roof clean all of the roof debris seal all penetrations pipes Vance AC unit skylights parapet walls flashings splits seems [sic] cracks three-course roof cement with roof webbing on All of the Above we let that set for a little bit then we put on a rubber Emulsion sealer on the whole roof we let that set for about 8 hours then we put on a real heavy coat of elastomeric rubber coating on the whole entire roof covering everything that we did on the bottom we’re guaranteed for 10 years one third down the rest on completion total price 4500 . . . .

Complainant accepted Respondent’s bid. Between July 2018, and mid-November 2018, Respondent’s employee Mr. Ryan performed most of the repairs described by Respondent’s proposal. Complainant paid the full contract price of $4,500.00.

Complainant testified that, when she took her Christmas lights down, she realized that Respondent had not repaired her patio roof. Complainant testified that Mr. McElwain told her that his daughter had underbid the job, but that Respondent would honor the contract. Complainant testified that Respondent never came out to repair the patio.

On February 3, 2019, while Complainant was out of town, her son texted her that water was pouring into the bedrooms on the southeast side of her house from roof leaks. Complainant testified that Respondent later made several attempts to repair the leaks.

Complainant alerted her insurance company about the damage to the interior of her home. Between February 18, 2019, and May 2019, Gurr Brothers repaired the damage caused by the roof leaks to the interior of Complainant’s house.

During a monsoon on August 28, 2019, the southeast corner of Complainant’s roof over the bedrooms again leaked. House Doctors performed temporary repairs to the roof and repaired new interior damage.

On September 16, 2019, another monsoon hit, and the southeast corner of Complainant’s roof again leaked. She consulted House Doctors, Gurr Brothers, and her insurance company. Gurr Brothers was unable to put a tarp on the roof to prevent further leaks, but was able to spray foam over the southeast corner of the roof to provide a temporary barrier.

Mr. Sellers testified that he started in the roofing industry in Ohio when he served an apprenticeship. He moved to Phoenix, where he worked for Standard Roofing and Universal Roofing. Mr. Sellers testified that he has been licensed in Arizona since 1989, doing business as United Central Roofing. Mr. Sellers testified that he does tile, shingles, foam, and occasionally built up and torch down roofing.

On September 24, 2019, Mr. Sellers on behalf of United Central Roofing performed an inspection and took photographs of Respondent’s repairs to Complainant’s roof. On October 11, 2019, Mr. Sellers issued a report, in relevant part as follows:

The existing roof is a spray foam system with a white elastomeric roof coating. The age of the spray foam is approximately 20-25 years. The coating appears to be 3-4 years old and shows multiple repairs. The repairs done to the existing roof at the time of the coating were completely incorrect. This is evident by the black roofing mastic showing through multiple areas where the coating has separated and is peeled due to two incompatible products coming together. Asphalt products should NEVER be used to repair a foam roof system for this reason. Because the asphalt product was used throughout the entire roof, it renders the roof un-repairable. In order to attempt repairs all of the contaminating asphalt products would have to be removed leading to a cost of close to a full replacement and would not have a manufacturer’s warranty.

Unfortunately, I cannot offer any repairs for your roof. I can only recommend a full replacement due to the incorrect repairs that are currently in place. A budget price for a full replacement – removing all existing roofing [down] to the plywood decking and installing a new spray foam roof system @ 1” nominal thickness and three (3) gallons per square (100 ft.) – would be approximately $ 22,900.00.

Complainant submitted Roofing Consultants of Arizona, Inc.’s January 17, 2020 bid to replace the roof on Complainant’s house, not including the patio, for a total cost of $26,460.00.

Mr. Sellers testified that, when he first saw Complainant’s roof in March 2018, it was repairable. Mr. Sellers testified consistently with his March 2018 estimate and October 2019 report. Mr. Sellers testified that multiple patches had been done with a non-compatible black asphalt product on the white spray foam elastomeric roof, which patches had separated and were peeling off Complainant’s roof. The repairs covered four different areas of the roof, but not the southeast corner. Mr. Sellers testified that the repairs should have been done with compatible elastomeric spray foam.

Mr. Sellers testified that he did not perform destructive testing, but that he took samples of the materials that were peeling off. Mr. Sellers testified that the industry standard was that elastomeric roofing materials be 25 – 27 mm. thick. The coating that was peeling off Complainant’s roof was 3 - 8 mm. thick. Mr. Sellers testified that over time, the mastic will shrink, allowing water to penetrate under the foam roof, leading to leaks.

Mr. Sellers testified that roofing foam manufacturer Pro-Tech Products, Inc. bases its roof warranties on the thickness of the coating product that has been applied. A 25-mm. thick coating will have a 7-year warranty and a 27-mm. thick coating will have a 10 year warranty for materials and labor.

Mr. Sellers testified that, in addition to the incompatible asphalt product on the elastomeric foam roof and the too-thin application of the asphalt product, footprints could be seen on the coating over the fabric mesh on the ductwork on the lower roof. Mr. Sellers testified that the footprints rendered Respondent’s repair inoperable.

Mr. Sellers testified that, to repair the roof to industry standards, all of the incompatible mastic material would have to be removed and replaced with compatible foam, which would cost half or two-thirds of the price of a new roof. Mr. Sellers testified that if undertook such an extensive repair, his liability insurer would cancel his policy because the repairs entailed too much potential liability compared to a new roof.

Investigator Morris testified consistently with the December 18, 2019 directive. He walked the entire roof with Respondent’s employee, Mr. Ryan. Investigator Morris testified that Mr. Ryan acknowledged performing most of the repairs over the roof.

Investigator Morris explained that the directive did not require Respondent to repair the southeast corner of the roof because someone else had made repairs over that section. Investigator Morris stated that A.R.S. § 32-1155(D)(2) prevented the Registrar from issuing a citation for poor work if a contractor’s work had been modified by another.

Mr. McElwain questioned Investigator Morris’ credentials to testify as a roofing expert. Investigator Morris testified that he has worked in construction for 30 years, including as a general contractor, home inspector, and municipal building inspector. Investigator Morris testified that, in his career, he has inspected 8,000 – 9,000 roofs.

Mr. McElwain also testified that he did not receive the December 18, 2019 directive because it was sent only via email and he does not use email. Investigator Morris testified that he also sent the directive to Respondent’s physical address of record. Investigator Morris noted that Respondent received notice of the jobsite inspection, which was sent to the same addresses as the directive.

Investigator Morris testified that Respondent never said that Complainant had not allowed reasonable access for Respondent to comply with the directive. Complainant testified that, if Respondent had attempted to comply with the directive, she would have allowed it to do so. Instead, Respondent offered her $3,500.00 to withdraw the complaint, which she declined.

Mr. McElwain testified that Respondent did not get the directive until late and that it just needed just one day to make repairs, but that Complainant had her attorney did not respond to his messages. Complainant submitted her attorney’s December 31, 2019 email to Respondent, asking about its plans to repair the roof. Mr. McElwain testified that Investigator Morris was lying when he said that Respondent never said that Complainant denied it access to perform repairs.

Mr. Ryan testified that contractors seldom praise each other’s work and that Mr. Sellers was counting on getting the job to replace Complainant’s roof. Mr. Ryan testified that any roof can be repaired if you take it down to the plywood. Mr. Ryan testified that Respondent offered Complainant money in lieu of repairs because he did not believe that she would allow Respondent back a third time to perform repairs.

Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s history on the Registrar’s public website on this date. Respondent’s License No. ROC 286561 is active and in good standing. It has never been disciplined on the current record. Complainant’s appears to be the only complaint pending against the license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainant bears the burden of proof to establish cause to suspend or revoke Respondent’s license by a preponderance of the evidence. Respondent bears the burden to establish affirmative defenses and factors in mitigation of the penalty by the same evidentiary standard.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” 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.”

Complainant established that Respondent’s repairs of her roof do not comply with the Registrar’s or minimum standards in the industry because (1) The asphalt product that Respondent used to repair the roof is incompatible with the existing elastomeric foam on the roof, resulting in the repairs not adhering and peeling off the roof; (2) The repairs are not thick enough to meet manufacturer’s specifications; and (3) The coating over the fiber mesh on the ductwork has been compromised by footprints. Therefore, Complainant established cause to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108.

Respondent did not establish that Complainant failed to provide reasonable access to Respondent to comply with the directive. Instead, it appears that the only action Respondent took after the directive was issued was to offer a financial settlement, which Complainant did not accept. Therefore, Complainant established cause to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is ordered that, on the effective date of the final order in this matter, License No. ROC 286561 of Respondent Cityluxe Companies LLC DBA: AZ’s Best Roofing shall be suspended for a period of five (5) days.

It is further ordered that the Respondent shall pay the sum of $250.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

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, March 10, 2020.

/s/ Diane Mihalsky

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors