ALJDEC decisions subject to certification as final

2021A-00314-OMC-LS-ROC · Registrar of Contractors · 2021-06-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Arizona Registrar of Contractors,

COMPLAINANT

MVP Buildings LLC,

License No. ROC 324058,

RESPONDENT

No. 2021A-00314-OMC-LS-ROC

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: June 1, 2021

APPEARANCES: John Tellier, Esq. for Complainant; Gary Spear for Respondent

ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT

On April 26, 2021, the Registrar of Contractors (“ROC”) issued a Notice of Hearing on Contested Case setting the above-captioned matter for hearing on June 1, 2021 at the Office of Administrative Hearings.

Through its Notice of Hearing, ROC alleges that Respondent MVP Buildings LLC may have violated Ariz. Rev. Stat. sections 32-1154(A)(2)(b) and (A)(3).

Respondent holds license No. 324058 issued by ROC. Gary Spear Respondent’s managing member appeared and testified for Respondent.

ROC presented the testimony of investigator Chris Allison.

Respondent performed work for Lola Cain and Mike Myers at a mobile home they owned in Overgaard.

The scope of work included completing the installation of a wood-burning fireplace (often referred to as a stove during the hearing), installing a new metal roof, replacing the “belly band,” painting, deck repair, furnace repair, and installing driveway rock and railroad ties.

The scope of work evolved over time with work beginning in July 2020 and ending in November 2020. Mr. Spear testified however that the roof was not complete when the work stopped because the project was on hold due to Ms. Cain and Mr. Myer’s financial issues.

The scope of work was not memorialized until September 7, 2020 and that contract does not include the full scope of work.

There is an invoice dated October 22, 2020, showing that Ms. Cain and Mr. Myer had paid Respondent $500 for completing installation of the fireplace.

On January 5, 2021, there was a fire at Ms. Cain and Mr. Myer’s house. Heber-Overgaard Fire District responded and received mutual aid from other fire departments.

On January 21, 2021, Ms. Cain filed with ROC a complaint against Respondent alleging poor work on Respondent’s part and stating that Respondent “Installed wood stove and chimney, home caught fire, insurance states total loss.”

On February 17, 2021, ROC’s Mr. Allison conducted a jobsite inspection.

After his jobsite inspection, Mr. Allison spoke to Heber Overgaard Fire District’s Deputy Chief Jason Payne who was first on the scene for the fire department.

An undated and unsigned report by Heber Overgaard FD shows that:

On arrival, smoke was showing from the area around the flue;

The area of fire origin was “Radiated or conducted heat from operating equipment,” the heat source was “Structural member or framing,” that the item first ignited was sawn wood, “including all finished lumber;”

That the cause of ignition was “Under Investigation” (underscore added);

That the “Design, manufacture, installation deficiency, other” were factors contributing to ignition;

That “Possibl[e] impair[ment] by alcohol or drugs” were human factors contributing to ignition; and

That the “Equipment Involved in Ignition” was a “Stove, heating”

After his jobsite inspection, Mr. Allison also spoke to Jon Samardzich, who Mr. Allison identified as a “Master Fire Investigator or a third party investigator hired by” Ms. Cain’s insurer. There was no evidence adduced as to what a Master Fire Investigator is or what education, training or experience are required to become a Master Fire Investigator.

ROC did not issue a Directive to Respondent.

ROC issued to Respondent a Citation dated March 25, 2021, through which ROC alleges that Respondent may have violated Ariz. Rev. Stat. sections 32-1154(A)(2)(b) and (A)(3)(i.e., R4-9-108(A)).

On March 16, 2021, Respondent filed a response to ROC’s Citation in which it: denied that it had violated the statutes; noted that the Fire District’s report shows that the homeowners may have been impaired; and asserted that a fire that was too large for the fireplace could have started the house fire.

Mr. Allison testified that when he asked Heber Overgaard FD’s Chief Payne whether he had noticed anything out of the ordinary, the Chief responded that the fireplace and chimney were not installed correctly noting that there was no clearance for combustible materials and that most likely the fireplace was not installed to manufacturer’s specifications.

According to Mr. Allison’s jobsite investigation notes, Chief Payne told him that it appeared that the stove was not installed to code and that it appeared the fire had started in the stove pipe.

Mr. Allison testified that Mr. Samardzich works for a firm that specializes in cause and origin of fires, and he is a very experienced investigator, but Mr. Allison did not provide any details about that experience.

Mr. Allison testified that Mr. Samardzich “confirmed” that there were installation issues, but at that time, although Mr. Samardzich made observations at the house, he had not completed his formal evaluation.

According to Mr. Allison, Mr. Samardzich also informed him that the fireplace was not suitable for installation in a mobile home.

Mr. Allison testified that the fireplace’s installation guide shows that it should not be installed in a mobile home. These instructions were not offered as an exhibit, but there is an installation manual in ROC’s administrative record showing that that fireplace should not be installed in a mobile home.

Mr. Spear testified that he had not received the installation instructions and he acknowledged that he had not read the instructions. Respondent’s employees performed the work on the fireplace, not Mr. Spear personally, but he was present when the work was conducted.

Mr. Allison confirmed with Navajo County that installation of the stove required a permit that was not obtained by either Ms. Cain, Mr. Myer or Respondent. There was also no final inspection of the fireplace.

According to Mr. Spear, the fireplace was about 70% installed when Respondent agreed to complete the installation, and Ms. Cain or Mr. Myer told him that they had a permit. Mr. Spear did not ask to see the permit or otherwise verify that it had been obtained, and he acknowledged that Respondent was required to post the permit while conducting its work, which Respondent failed to do.

Mr. Spear testified that there was no final inspection because the work was not complete. According to Mr. Spear, Respondent completed the installation of the fireplace and had run the stove pipe through the existing roof jack. The roof however was not completed when Ms. Cain and Mr. Myer had financial issues and the work was put on hold. Before Respondent did any additional work, Mr. Spear learned of the fire.

Mr. Spear testified that completing the roof would have required removing the roof jack which would then require an inspection. Mr. Spear testified to the effect that because you only call for one inspection, Respondent did not call for the fireplace to be inspected, but was waiting until the roof was complete.

Mr. Spear acknowledged that in Respondent’s answer to ROC’s Citation, he wrote that Respondent was hired to complete the installation of the fireplace, which Respondent did. Mr. Spear did not agree that this was a false statement because the fireplace flue had been connected but Respondent’s work on the roof was not completed.

Mr. Spear testified that he had not given Ms. Cain and Mr. Myer the go-ahead to use the fireplace. Mr. Spear also acknowledged that Respondent’s answer did not show that he had told Ms. Cain and Mr. Myer not to use the fireplace.

Respondent questioned whether Mr. Allison had questioned Chief Payne or Mr. Samardzich about the Fire District’s report showing possible impairment as a contributing factor and whether he had asked about other possible sources of ignition.

Mr. Allison explained that he had not asked either Chief Payne or Mr. Samardzich questions about other potential causes of the fire, including impairment, because that information was beyond the scope of Mr. Allison’s authority, which is limited to ROC’s statutes in Title 32. He also testified that during his investigation he received no information showing that the homeowners were actually impaired or that they had contributed to the fire.

Mr. Allison’s opinion is that the fireplace was not properly installed and was not appropriate for installation in a mobile home. As to whether the fireplace was improperly installed, it is not clear whether Mr. Allison had an independent opinion or was relying on the opinions of Chief Payne and Mr. Samardzich.

ROC requests that Respondent’s license be revoked because the matter involved a potential loss of life.

CONCLUSIONS OF LAW

“At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(2).

The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.

A preponderance of the evidence is:

The 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.

Black’s Law Dictionary 1373 (10th ed. 2014).

Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).

The Administrative Law Judge may consider ROC’s administrative record. See Ariz. Admin. Code § R4-9-118.

Ariz. Rev. Stat. section 32-1154(A) provides in part:

The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions:

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2. Departure from or disregard of:

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(b) A building code of this state or any political subdivision of this state in any material respect that is prejudicial to another.

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3. Violation of any rule adopted by the registrar.

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Ariz. Admin. Code section R49108(A) provides that: “A contractor shall perform all work in a professional and workmanlike manner.”

Administrative Law Judge Decisions must be based on evidence that is substantial, reliable and probative. Ariz. Rev. Stat. § 41-1092.07(F)(1).

Although hearsay can be admitted at an administrative hearing, the Decision may not be based on unreliable hearsay and foundation as to the speaker’s knowledge must be provided before hearsay can be considered reliable. Plowman v. Ariz. State Liquor Bd., 152 Ariz. 331, 753 P.2d 222 (App. 1986).

The preponderance of the evidence shows that Respondent performed work installing the fireplace without the required permit.

The preponderance of the evidence also shows that the fireplace should not have been installed in a mobile home and therefore that Respondent did not follow the installation instructions when it completed the installation.

Mr. Allison testified that Chief Payne said that the fireplace was also improperly installed in that there was insufficient room for combustible material. Mr. Allison did not provide any information about the facts on which Chief Payne’s opinion was based, and Heber Overgaard FD’s report does not corroborate Mr. Allison’s testimony on this point.

Mr. Allison also testified that Mr. Samardzich had confirmed improper installation, but Mr. Allison did not provide any substantial information as to the basis of Mr. Samardzich’s opinion, and Mr. Allison acknowledged that Mr. Samardzich provided his opinion before he completed his evaluation.

Consequently, Mr. Allison’s hearsay testimony that that the fireplace was improperly installed in that there was insufficient room for combustible material has not been proven to be reliable.

Heber Overgaard FD’s report shows that the fire started in the fireplace, which is proven by a preponderance of the evidence. That report also shows that the cause of the fire was under investigation and there was no substantial evidence showing that either the Fire District or Mr. Samardzich determined the cause of the fire. And the Fire District’s report shows that in addition to possible installation issues, the manufacture and design may have contributed to the fire, and that impairment by alcohol or drugs also possibly contributed to the fire.

It has not been proven by a preponderance of the evidence that it was Respondent’s work that caused the fire.

Under the facts and circumstances of this matter, Respondent’s failure to obtain the required permit and its work installing the fireplace in a mobile home are violations of Ariz. Admin. Code section R4-9-108(A), which is also a violation of Ariz. Rev. Stat. section 32-1154(A)(3).

The preponderance of the evidence shows that when Respondent took over the installation of the fireplace, Ms. Cain or Mr. Myer indicated that they had the required permit. The preponderance of the evidence also shows that Respondent had not completed its full scope of work when the project was put on hold and that an inspection of the roof would be required when Respondent did complete that work. Consequently, it has not been shown that Respondent’s working on the fireplace without a permit caused any prejudice to Ms. Cain, and it has not been proven that Respondent violated Ariz. Rev. Stat. section 32-1154(A)(2)(b).

Because Respondent has violated Ariz. Rev. Stat. section 32-1154(A)(3), ROC has authority to discipline its license.

Respondent worked on a fireplace that should not have been installed in the mobile home and it did so without having a copy of the installation instructions, which is a serious violation. But because it was not proven that Respondent’s work led to the fire at issue, revocation is not warranted. It is recommended that Respondent’s license be suspended for ten business days.

RECOMMENDED ORDER

IT IS RECOMMENDED that the Registrar of Contractors suspend MVP Buildings LLC’s license number 324058 for ten business 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 is forty days after the date of that certification.

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-137160-45720000Done this day, June 21, 2021.

/s/ Thomas Shedden

Thomas Shedden

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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