ALJDEC decisions subject to certification as final

2019A-05867-CHC-ROC · Registrar of Contractors · 2020-06-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Jay Bruce Bernstein and Cathy Brannigan,

COMPLAINANT

Patterson Remodeling LLC,

License No. ROC 245563, 242914,

RESPONDENT

No. 2019A-05867-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 8, 2020 and May 20, 2020.

APPEARANCES: Corey Richter, attorney, appeared on behalf of Jay Bruce Bernstein and Cathy Brannigan, Complainants. Rylan Stewart, attorney, appeared on behalf of Patterson Remodeling LLC, Respondent.

ADMINISTRATIVE LAW JUDGE: Antara Nath Rivera.

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FINDINGS OF FACT

On or about May 13, 2008, the Registrar of Contractors (ROC) issued License No. 242914 for Specialty Dual CR-48 Ceramic, Plastic, and Metal Tile to Patterson Remodeling LLC (Respondent). Respondent’s address of record for the license is 2716 North Ogden Road, Suite 101, Mesa, AZ 85215. Curtis Lee Patterson is listed on the license as Qualifying Party and Member and Ryan Curtis Patterson is listed as Member.

On or about July 15, 2008, the ROC issued License No. 245563 for General Residential B-3 General Remodeling and Repair Contractor to Respondent. Respondent’s address of record for the license is 2716 North Ogden Road, Suite 101, Mesa, AZ 85215. Curtis Lee Patterson is listed on the license as Qualifying Party and Member and Ryan Curtis Patterson is listed as Member.

Pursuant to Arizona Administrative Code (A.A.C.) R4-9-17, administrative notice is taken of Respondent’s prior license record, for License Nos. 242914 and 245563, as reflected on the ROC’s public website on May 20, 2020. Such prior license record reflects that Respondent’s licenses are active. The record also reflects that for License No. 242914, there is one disciplined case and no open cases. There is an active surety bond with RLI Insurance Company in the amount of $6,750.00. The record reflects for License No. 245563, there are three resolved/settled cases, one disciplined case, and one open complaint against Respondent’s license, which is presumed to be related to this matter. There is an active surety bond with RLI Insurance Company in the amount of $9,000.00.

On or about April 13, 2016, Jay Bruce Bernstein and Cathy Brannigan (Complainants) entered into a written contract agreement whereby Patterson Remodeling LLC (Respondent) agreed to partially remodel Complainants’ residential home at the address of 10416 N. 22nd Way, Phoenix, Arizona, 85028. The total contract amount was $82,645.49. The project commenced in October 2016 and abandoned in October 2018. Complainant paid Respondent a total of $78,877.30.

On or about November 26, 2019, the ROC received a Complaint alleging abandonment and poor workmanship.

On or about November 27, 2019, the ROC issued a Jobsite Inspection Notification letter to the parties, providing proper notice to them, and advising them that an onsite review would be conducted at the project site by an ROC investigator on January 9, 2020, at 10:00 a.m.

On January 9, 2020, ROC investigator Steve Klein (Investigator Klein) conducted an inspection of the work that had been done on the project to date and took approximately 20 photographs. All parties were present at the Jobsite Inspection.

On or about January 10, 2020, Investigator Klein issued a Directive From The Registrar (Directive) to the parties because he substantiated Complainants’ allegation that Respondent abandoned the project and that Respondent’s work was incomplete and fell below workmanship standards. Specifically, Respondent was ordered to remediate complaint items 1-19 via appropriate means. The compliance deadline for the Directive was February 6, 2020.

On or about February 13, 2020, the ROC issued a Citation to Respondent for alleged violations of Arizona Revised Statute (A.R.S.) §§ 32-1154(A)(1); 32-1154(A)(3) and 32-1154(A)(22), and A.A.C. R4-9-108. Respondent was given until February 28, 2020, to respond with its Answer or face discipline pursuant to A.R.S. §§ 32-1154(A)(22) and 32-1155.

On or about February 7, 2020, Respondent’s attorney emailed Investigator Klein and informed him that Respondent had not completed the work.

On or about March 27, 2020, the ROC referred this matter to the Office of Administrative Hearings, an independent state agency, for a hearing on May 8, 2020.

On or about May 7, 2020, Investigator Klein conducted a Prehearing Inspection. Only the Complainants were present.

Investigator Klein testified at the hearing. Corey Richter, Complainants’ attorney, presented the testimony of Cathy Brannigan and Chris Kortas. Rylan Stewart, Respondent’s attorney, presented the testimony of Delafayette Guyton Sherrill.

HEARING EVIDENCE

Investigator Klein testified that Respondent failed to complete the requisite work per the Directive by the deadline. Following the Prehearing Inspection, Investigator Klein determined that some work was done, including the inside framing of the roof. Investigator Klein stated that he observed partial drywall but learned that the framing and trusses were not signed off. Additionally, he did not know the history of the skylights and he did not observe any skylights. Investigator Klein opined that the house could have been completed by the Directive deadline.

Ms. Brannigan testified that she contracted with Respondent in October 2016. Respondent first abandoned the project approximately one year later because the supervisor became sick. Eventually, Respondent came back to the project but then left again for no reason. Ms. Brannigan hired a lawyer in 2018. Ms. Brannigan’s attorney and Respondent’s attorney entered into an agreement (Agreement) whereby Respondent was to redo the roof and pay for the reengineering and installation of the skylights. When Respondent failed to honor the agreement, Complainants filed a Complaint with the ROC.

After the Directive was issued, Respondent never stepped foot in Complainants’ home. When Respondent addressed the issues after the Directive expired, Respondent corrected items 6, 7, 14, and 19 from the Directive.

Ms. Brannigan testified that the skylights have been an issue since the beginning. When the skylights were not made part of the original agreement, Ms. Brannigan informed Respondent. Respondent indicated that it was not important and that it would be addressed later. Respondent addressed the skylights by covering over two existing skylights and failing to install a third skylight. Between December 2016 and April 2017, Del Lawson, Respondent’s agent, and Ms. Brannigan exchanged numerous text messages pertaining to the skylights. In summary, they discussed the scheduling, engineering, and installation of the skylights. Neither Mr. Lawson, nor any representative from Respondent, indicated that the skylights were not part of the scope of the project. Additionally, the skylights were amicably made a part of the Agreement.

On or about December 3, 2018, Complainants’ roof began to leak. Both parties’ attorneys communicated regarding this issue. Respondent informed Complainants that it would come to address the leak but never did.

There was also an issue with respect to the construction of a water closet. Both attorneys agreed to the construction of the water closet in the Agreement. Respondent failed to construct the water closet.

Ms. Brannigan described the photos admitted into evidence. The photos depicted the garage, driveway, family room, bedroom, master bathroom, front living room, and back patio as they currently appeared. The photos showed incomplete work, including drywall, duct work, and trusses. The photos also illustrated damage to personal property and areas that were open to outside elements.

Ms. Brannigan opined that Complainants lived in this condition for approximately four years. She was unable to do laundry or cook and had health issues as result of the condition of the house and as a result of her experience with Respondent.

Mr. Kortas, Complainants’ electrician testified that the skylights were a part of the original project. Mr. Kortas was familiar with the project because he was responsible for the wiring around the skylights. Additionally, in late 2016 to early 2017, he observed Ms. Brannigan bring the skylights from her storage container to her house so that Respondent could install them.

Mr. Sherrill testified that he worked for Respondent as a remodeling manager. Mr. Sherrill came upon this project when he “walked this job” after the Directive was issued. Mr. Sherrill stated the general nature of the Directive was to finish the project per the original contract. Mr. Sherrill went to the project and completed items 5, 6, 14, 15, and 18. Mr. Sherrill argued that the following items were not part of the original contract: 1, 2, 9, 11, 17 and 19. Respondent attempted to get the plans approved for skylights but it could not get a hold of Ballard Truss. Mr. Sherrill opined that even though he had no personal involvement in this project until the ROC became involved, he knew that skylights were part of the original contract. The reason that some of the items were not fixed was because Respondent did not want to deviate from what the ROC told it to do and needed approval from the city before moving forward on some of the items.

Mr. Sherrill was unfamiliar with the specifics of the project with respect to some of subcontractors and work done by them because his involvement began after the ROC Complaint was filed. Mr. Sherrill acknowledged that the project was not completed per the original contract and it was not completed per the Agreement.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. The copy of the Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and Respondent is deemed to have received notice of the hearing. See A.R.S. §§ 41-1092.04 and 41-1092.05(D).

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).

A.R.S. § 32-1154(A)(1) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.”

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)(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.R.S. § 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 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 Registrar has the authority to issue license discipline under this provision, including summary suspension, revocation, or imposing a civil penalty or recovery fund award.”

A.R.S. § 32-1154(E) holds, in pertinent parts, that the Registrar 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.”

The evidence showed that Respondent’s work resulted in poor workmanship in violation of A.R.S. § 32-1154(A)(3)-R4-9-108. Complainants established that Respondent’s work resulted in poor workmanship when Complainant experienced the following issues, which included but was not limited to, leaks in the roof resulting in damage to the drywall and personal property, exposed duct work, and exposed interior of the home to outside elements.

Furthermore, there was evidence that Respondent abandoned the project when they failed to complete the agreed upon contract to partially remodel Complainants’ residential home. The evidence showed the incomplete work performed by Respondent over the last three years. Respondent presented the testimony of Mr. Sherrill who was not involved with this project until the ROC was involved. Thus, Respondent failed to complete the project without legal justification in violation of A.R.S. § 32-1154(A)(1).

Lastly, Complainants established that after given the chance to correct the issues, Respondent failed to take the appropriate corrective action following a written Directive from the ROC. Respondent failed to complete the items on the Directive that were deemed as incomplete by the ROC before the deadline. Respondent’s argument that it was unable to comply with the Directive due to violating building codes as result of the corrected work and due to unapproved plans was not legally justified. Thus, Respondent was in violation of A.R.S. § 32-1154(A)(22).

Complainant may petition the Registrar’s Recovery Fund for financial recompense regarding this matter, as the Tribunal has no jurisdiction to award a refund of the underlying amount contracted between the parties.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent Patterson Remodeling LLC, License Nos. 245563 and 242914 for a period of five (5) 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)(7), 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, June 8, 2020.

/s/ Antara Nath Rivera

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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