ALJDEC decisions subject to certification as final

2020A-04148-CHC-ROC · Registrar of Contractors · 2021-05-11

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Stewart Peterson,

COMPLAINANT

CBC Inc.

License No. ROC 151962,

RESPONDENT

No. 2020A-04148-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 19, 2021 and April 21, 2021 with the record held open until April 30, 2021 for the parties to submit written closing arguments.

APPEARANCES: Complainant Stewart Peterson was represented by Austin Slade, Esq. appearing via Google Meet. Respondent CBC Inc., was represented by Robert Berens, Esq. appearing via Google Meet. Beau Cruz, Investigator for the Registrar of Contractors appeared via Google Meet.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

_____________________________________________________________________

FINDINGS OF FACT

CBC Inc. (Respondent) is the holder of License No. 151962 issued by the Arizona Registrar of Contractors (Registrar).

This matter originates from warranty work on a new home build. Initially, Respondent built a home for the Johnsons, and then in late 2019, the Johnsons sold the home to Stewart Peterson (Complainant) and his wife, Nichole Peterson.

On or about August 27, 2020, the Registrar received a Complaint containing thirty seven items against Respondent from Complainant alleging poor work with respect to various items in the house.

The Registrar assigned the complaint to Investigator Beau Cruz. The Complaint was initially closed on or about September 8, 2020, then re-opened on September 21, 2020. The jobsite inspection was performed on October 16, 2020.

Investigator Cruz issued a Written Directive on or about October 22, 2020 to Respondent that provided as follows:

After investigation, the Registrar determined that you failed to meet the requirements of A.R.S. § 32-1154(A), and now issues this Directive requiring you to take appropriate corrective action. 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. You must notify

the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on November 20, 2020.

. . .

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

Complaint Item 2: Dry wall heaving and buckling on both sides of a 50' hallway where the sheets of drywall meet which created a long ridge or wavy portion along the hallway

Investigator’s Observation: The respondent mostly corrected drywall issues prior to jobsite inspection. Faint outline of nail head noted on the east

(E) wall of the east (E) hallway.

Governing Rule: Workmanship Rule: A.R.S §32-1154(A)(3), namely R4-9-

108(A) A contractor shall perform all work in a professional and workmanlike manner and, (B) A contractor shall perform all work in accordance with any

applicable building codes and professional industry standards. For work to be performed in accordance with professional industry standards, a contractor shall use skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of similarly licensed contractor possessing ordinary skills and capacity.

Complaint Item 6: Dry wall heaving, cracking, and buckling on wall in butler's pantry area

Investigator’s Observation: Dent on west (W) wall of Butler's Pantry area.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 7: Spot painting of shoddy workmanship on drywall and paint does not blend in hallway area

Investigator is Observation: Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 8: Spot painting of shoddy workmanship on drywall and paint does not blend in butler's pantry

Investigator’s Observation: Flashing of paint visible on the walls. Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 9: Spot painting of shoddy workmanship on drywall and paint does not blend in main living room

Investigator’s Observation: Flashing of paint visible on the left side of the east (E) arch soffit wall in the main Living Room. Paint runs noted on the north (N) wall of the main Living Room by the left lower corner of the right picture (Cloud) window. Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 10: Spot painting of shoddy workmanship on drywall and paint does not blend in master bedroom

Investigator’s Observation: Visible seam line and flashing of paint on the left (S) inside wall Master Bedroom entry. Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 11: Spot painting of shoddy workmanship on drywall and paint does not blend in master bathroom and ceiling area

Investigator is Observation: Flashing of paint visible on the west (W) wall and north (N) entry arched soffit wall on Master Bathroom, paint run on north (N) wall of Master Bathroom water closet room, faint crack, and seam line on the east (E) wall to left of Master Bathroom window above the tub area.

Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 19: backsplash tiles have grout completely missing in grout lines (no grout at all) or grout is not adequate to form a good grout line in the pantry area

Investigator’s Observation: Missing grout on the bullnose tile for side splash by right wall cabinet on the east (E) wall of the Butler’s Pantry.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 22: CBC has tried to take shortcuts with the painting and tried to blend all painted areas in and it looks TERRIBLE

Investigator’s Observation: Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 24: Large Stucco cracks around the home

Investigator’s Observation: Large stucco crack in excess of 1⁄8′′ on the east (E) side of the structure at area of stepped down stem walls, and large cracking/separation in excess of 1⁄8′′ on stucco between screen wall of condensing unit area and south (S) exterior wall of the east (E) garage. Respondent repaired stucco cracks on the northeast (N/E) exterior corner of the east (E) of garage prior to jobsite inspection.

Governing Rule: Workmanship Rule: Regarding the cracks in the step down stem wall area and cracking and separation between south (S) wall of east (E) garage, refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 25: Baseboard tiles in the Casita are coming apart from the drywall area

Investigator’s Observation: Tiled baseboard at the entry to the Casita next to door latch jamb has separated from wall, and is loose. Respondent corrected loose tiled baseboard and north (N) wall of Casita prior to jobsite inspection.

Governing Rule: Workmanship Rule: Regarding the loose tiled baseboard at entry to the Casita, refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 29: Casita drywall cracking

Investigator’s Observation: Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 30: gutters or roofing flashing not properly installed

Investigator’s Observation: Gap/missing and cracking stucco between kick out flashing and stucco above the east (E) garage door at the right corner.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 32: garage ceiling drywall cracking / heaving

Investigator’s Observation: Respondent is to finish painting as per agreement between the parties.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

Complaint Item 35: utility closet needs painting due to leaking on demand hot water heater

Investigator’s Observation: Water stains on the south (S) wall in mechanical room, below tank less water heater.

Governing Rule: Workmanship Rule: Refer to A.R.S §32-1154(A)(3), namely R4-9-108(A)(B) cited above.

. . .

(All errors contained in the original).

On December 10, 2020, Investigator Cruz performed a Compliance Jobsite Inspection. In his notes regarding the same, Investigator Cruz noted that Items 6, 8, 9, 10, 11, 12, 22, 29, 32 and 35 were still not in compliance. Investigator Cruz also noted the following:

Respondent alleges interference on the part of the complainants from completing or properly complying per the directive due to inability to please complainants and, denied proper opportunities on the part of the complainants to complete work. Complainant contends that respondent has had improperly trained workers in the home, as well as has also alleged improper supervision on the part of the respondent, with one incident in which complainant alleges one worker was performing work when was under the influence of drugs.

(All errors contained in the original).

On December 15, 2020, 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; and A.R.S. § 32-1154(A)(22).

On or about December 29, 2020, Respondent submitted an Answer to the Registrar outlining the efforts they took to comply with the Directive.

On or about February 10, 2021, a Notice of Hearing was issued setting a hearing on March 19, 2021 at the Office of Administrative Hearings, an independent state agency.

Investigator Cruz testified as to his involvement the above timeline, and each of the Complaint items.

Investigator Cruz testified that the Complaint was initially closed because Complainants refused to allow Respondent back into the home. When Complainant Investigator Cruz that he would allow access, the Complaint was re-opened.

Further, Investigator Cruz testified that there was no prehearing inspection because the Complainants would not allow additional work to be performed after the Compliance Jobsite Inspection in December.

In addition, Investigator Cruz testified that he believed that the Directive permitted a sufficient amount of time to perform the corrective work.

Investigator Cruz testified that there were scheduling issues, and that he was trying to make the parties more flexible.

As to the painting, Investigator Cruz testified that the way the paint was applied did not meet workmanship standards. He testified that this was because Respondent was using left-over paint so there would be some change in looks.

Complainant testified on his own behalf and offered seventeen exhibits into evidence.

Complainant testified that on December 17, 2019, he moved into the house. On or about January 10, 2020, he sent an e-mail to Respondent requesting that Respondent fix some issues with the house.

Complainant testified that Respondent was at the residence in March, 2020, but was not happy with the spot painting and the work performed.

Complainant testified that he sent a letter to Respondent on July 29, 2020 informing Respondent that if they were to come back to the property, it would be considered criminal trespass. Complainant also testified that he was unaware if his wife was slandering Respondent to other neighbors.

Complainant testified that he filed the Complaint on August 27, 2020. Complainant testified that initially he did not want Respondent back on his property, which is why the Complaint was closed. However after reconsideration, he agreed and the Complaint was re-opened.

Complainant testified that he allowed Respondent to commence the repairs prior to the written directive being issued, but did order Respondent to stop work on October 12, 2020.

Complainant testified that Respondent suggested that he perform the corrective work commencing November 16, 2020. He further testified that Respondent ran out of time, so he agreed to extend their access through November 20, 2020.

In addition, Complainant testified that there were many issues with the workers Respondent sent to perform the corrective work, such as their inexperience and one worker possibly under the influence of drugs or alcohol while at the jobsite.

Complainant testified that he believed that he gave ample access to the property, but did not allow any further work to be performed once the Directive expired.

Further, Complainant testified that Respondent performed additional work which was not required under the Directive.

Complainant testified that while he did not recall Respondent requesting that they come back on November 21, 2020, he would not have let them anyway because the Directive deadline had expired.

Finally, Complainant testified that all he wanted was his house fixed.

Nichole Peterson testified that on October 5, 2020, Respondent performed a walk-through and she pointed out an issue with spackle because Respondent’s worker damaged the wall with a ladder.

With regards to the painting, Ms. Peterson testified that the paint that was used to make the repairs was the left-over paint in the garage and that it did not match. She testified further that the workers were just painting over the cracks and not fixing them, and not painting wall to wall as previously agreed.

Ms. Peterson admitted that she ordered Respondent to stop work on October 12, 2020, because she was wanting the advice of Investigator Cruz prior to allowing further work.

Ms. Peterson testified that she requested that additional issues be corrected during the Directive period such as cracking in Mr. Peterson’s office and in their daughter’s bedroom.

Further, Ms. Peterson testified that she requested that the painted be redone because it was not completed wall-to-wall and that the sheen did not match.

Ms. Peterson testified that on November 20, 2020, she recalled that Respondent was requesting to come back on the 21st or 22nd to complete the work. She refused to allow the same, and also did not respond to the request to complete the work on November 23,, 2020.

Finally, Ms. Peterson testified that had Respondent not been taking shortcuts and performing sloppy work, she would have allowed Respondent to continue after the deadline expired.

Vince Stark and Tyler Shulman testified on behalf of Respondent, and offered twenty-eight exhibits into evidence.

Tyler Shulman testified that he was the Project Manager for Respondent and had 16 years of experience in the construction business.

Mr. Shulman testified that we went to Complainant’s house every morning and go over the scope of the work for the day. He also testified that he was at the project about three times per day, and would go at the end of the day and check on the quality of the work performed.

Mr. Shulman testified that he never instructed any of his workers to use shortcuts.

As to the paint, Mr. Shulman testified that Complainant supplied the paint which was located in the mechanical room, and he helped label it to determine which paint should be used in each specific room. Mr. Shulman testified that in the butler pantry area, semi-gloss paint was used, but that Ms. Peterson did not like it, so he agreed to re-paint the same with flat paint.

During the October and November repairs, Mr. Shulman testified that they were performing additional work at Complainant’s request, such as the garage, various cracks in the office and daughter’s bedroom, and re-painting the entire hallway.

Finally, Mr. Shulman testified that if there was no additional work requested by Complainant, the corrective work would have been completed in full by November 20, 2020. Further, Mr. Shulman testified that he would not have done the extra work if he knew Complainant was not going to let them continue past November 20, 2020. However, he was trying to make Complainant happy with the project.

Vince Stark testified that he was a general contractor for 29 years.

Mr. Stark testified that when he initially completed the work in March 2020, he believed that Complainant was satisfied. Then in July 2020, he reached out to Complainant after he heard other people in the neighborhood complain about his work. It was his belief that Ms. Peterson was telling neighbors that Respondent did poor work. Mr. Stark testified that Complainant informed him that he had no issues with the work, but for some painting issues. Then on July 29, 2020, he received a letter from Complainant asking him not to return to the property.

Mr. Stark testified that on September 8, 2020, without knowing that the Complaint had been closed, he reached out to Complainant requesting that they put their personal issues aside and that he be allowed to make the requested repairs.

In addition, Mr. Stark testified that once he found out that the Complaint was re-opened he requested that he be permitted to complete a walk-through to see exactly which areas needed repairing, and proposed that that occur on September 23, 2020.

Mr. Stark testified that the walk through occurred on October 5, 2020, and they noticed the spackle issue in the bathroom. Mr. Stark testified that although his workers did not damage the wall, he agreed to fix the same because Ms. Peterson said that she would get her attorney if he refused.

As to the work performed during the Directive time period, Mr. Stark testified that it was hard to mobilize workers to make the repairs which is why he proposed to commence work on November 16, 2020, from 8:00 a.m. until 5:00 p.m. Also, Mr. Stark testified that Complainant would only allow access until 4:00 p.m., and while Complainant never forced him out at 4:00p.m., he did not wish to work longer to honor Complainant’s request.

Further, Mr. Stark testified that while he originally thought that the corrective work would only take three days, he had to request additional time due to all of the extra items Complainant was adding to the repair list.

Mr. Stark testified that when the work was not completed on November 20, 2020, Complainant’s refused to allow them to complete the remaining items.

Mr. Stark testified that he believed that Ms. Peterson was directing the means and methods of the corrective work and he agreed to follow her directions.

Finally, Mr. Stark testified that he felt deceived by Complainant, as that Ms. Peterson would never be satisfied with the work.

Administrative notice is taken of Respondent’s prior License record on May 11, 2021. Such prior License record reflects that Respondent’s License No. 151962 was first issued on February 3, 2000.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

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 Vazzano 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).

The preponderance of the evidence provided by Mr. Cruz established that Respondent’s work was not in conformity with the Registrar’s standards. Various painting issues existed, as did large Stucco cracks, loose baseboard tiles, and improperly installed gutters and roofing flashing. 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.

The evidence established, and Mr. Shulman and Mr. Stark admitted, that they failed to complete all of the corrective work following the Directive being issued as to the windows. However, Respondent believed that there was a valid justification for the same. Admittedly, Respondent did a yeomen’s job in correcting most of the work, even prior to the initial jobsite inspection, as well as performing additional work at the request of Ms. Peterson. While the Tribunal does not believe that Complainant and his wife acted nefariously to purposely set up Respondent to fail, it certainly begs the question if they truly wanted the work completed, because they did not allow the extra time once the Directive expired. That being said, Respondent did no favors for itself waiting until the week of the Directive deadline to commence work. Mr. Stark and Mr. Shulman were clearly aware of the history between the parties, and should have made the Directive their number one priority over other projects and performing the extra work. Again, it is commendable that Mr. Stark attempted numerous times to make Complainant happy, which is why he took on the additional work outside of the Directive. Complainant established however, that Respondent failed to take appropriate corrective action to the Directive items from the Registrar in violation of A.R.S. § 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, and taking into account the actions of the parties, it is recommended that on the effective date of the Order, the Registrar shall suspend Respondent’s License No. 151962 for a period of two days.

It is further recommended that the Registrar require Respondent to pay the sum of $200.00 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 30 days from the date of that certification.

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-137160-45720000Done this day, May 11, 2021.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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-137160-45720000