ALJDEC decisions subject to certification as final

2021A-00577-CHC-ROC · Registrar of Contractors · 2021-07-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Laura Ann Kavanaugh ,

COMPLAINANT

Midstate Concrete Inc

License No. ROC 328234,

RESPONDENT

No. 2021A-00577-CHC-ROC

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: July 7, 2021

APPEARANCES: Laura Ann Kavanaugh on her own behalf; Michael Coleman for Respondent

ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT

On May 25, 2021, the Registrar of Contractors (“ROC”) issued a Notice of Hearing on Contested Case setting the above-captioned matter for hearing on July 7, 2021 at the Office of Administrative Hearing.

Through its Notice of Hearing, ROC alleges that Respondent Midstate Concrete Inc. may have violated Ariz. Rev. Stat. sections 32-1154(A)(3), (A)(12), (A)(14) and (A)(22).

Respondent holds license No. 328234 issued by ROC. Michael Coleman, Respondent’s owner appeared and testified for Respondent.

Complainant is Laura Ann Kavanaugh.

Ms. Kavanaugh appeared and testified and presented the testimony of Mark Frank and Kelly Kavanaugh.

ROC investigator Steve Philpott also testified.

Neither party submitted a disclosure statement.

Complainant and Respondent entered a contract that called for Respondent to install a concrete driveway at a property owned by Complainant. Mr. Frank and Kelly Kavanaugh act as property managers for Complainant and had more knowledge of the facts than did Complainant.

About seven months after the driveway was complete, Complainant expressed dissatisfaction with the work and the parties agreed that it should be modified to improve the drainage near an existing garage. To do so Respondent altered the concrete by adding a swale or low spot. Mr. Coleman testified to the effect that he did not want to cut the swale too deep to avoid having a too large a bump in the driveway.

Complainant was not satisfied with the repair and on February 8, 2021 she filed with ROC a complaint against Respondent alleging poor work on Respondent’s part.

On March 4, 2021, ROC’s Mr. Philpott conducted a jobsite inspection.

At the jobsite inspection, the parties agreed that Respondent should cut a trench into the concrete and cover it with a grate, with the intention being to improve the drainage.

On March 18, 2021, ROC issued to Respondent a Directive that provides in part:

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

Compliance Item: 3 - New driveway has a large rough trough where the grade was chiseled down and then was dyed.

Investigator’s Observation: This complaint item is verified. Per jobsite agreement the Respondent will correct by appropriate means. Respondent agreed to remove the 12” section of concrete between the garage slab and the driveway. This area will be modified to provide for drainage and a metal grate will be added at this section.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(a): A contractor shall perform all work in a professional and workmanlike manner.

Through its Directive ROC informed the parties that the other allegations in Complainant’s complaint did not require correction. These other items included an allegation that the concrete had been dyed and an allegation that water was draining into the garage.

Through its Directive ROC ordered Respondent to provide ROC with proof that it had had made the agreed upon correction by 5:00 p.m. on April 5, 2021. On April 7, 2021, ROC issued an Amended Directive through which it extended to 5:00 p.m. April 23, 2021 the time and date by which Respondent was required to comply.

On April 26, 2021, Mr. Philpott conducted a compliance jobsite inspection. Mr. Philpott’s Compliance Jobsite Inspection Notes show in pertinent part:

Compliance Findings: The Finished surface of the repair is ruff , unsightly and is not consistent with the finishes of the new driveway installed by the Respondent. The expansion joint is missing between the repaired work and the existing garage slab. The control joint between the patch work and the new driveway is inadequate. The corrective work fails to meet minimum industry standards as defined below.

Workmanship Standards for Licensed Contractors (June 2009)

RULE 4-9-108 WORKMANSHIP STANDARDS - A contractor shall perform all work in a professional and workmanlike manner.

Possible deficiency- Improper expansion and/or control joints in driveways.

Acceptable tolerance - Driveways should have expansion joints at carport or garage and at curb or sidewalk.

Contractor responsibility - Contractor should correct to provide proper control or expansion joints.

Possible deficiency - Improper, inadequate, unsightly finishing.

Acceptable tolerance - None.

Contractor responsibility - Contractor should make necessary repairs.

ROC issued to Respondent a Citation dated April 30, 2021, through which ROC alleges that Respondent may have violated Ariz. Rev. Stat. sections 32-1154(A)(3), (A)(12), (A)(14) and (A)(22).

At the hearing, Mr. Philpott acknowledged that determining whether a concrete surface’s finish was unsightly calls for a subjective assessment.

At the hearing, Mr. Coleman acknowledged that Respondent had not included an expansion joint at the interface between the garage and the repaired concrete. He explained however that he had made a conscious decision not to include the joint because the area of concrete was so small he was concerned that adding the joint would lead to problems in the future.

Mr. Coleman did not agree that the existing control joints were inadequate, explaining that control joints were to be placed every 100 square feet and testifying to the effect that there were a sufficient number of control joints.

Mr. Coleman testified that Respondent was willing and able to correct the issues identified by Mr. Philpott at the compliance jobsite inspection, although he did not necessarily agree that these were all deficiencies. To correct those issues, would require removing the drain, placing the expansion joint, reinstalling the drain, and edging the concrete to match the existing concrete.

Although Complainant’s desire was to have the work corrected, Ms. Kavanaugh testified to the effect that she did not have confidence that Respondent could make the required repairs.

Kelly Kavanaugh testified to the effect that the driveway required replacement, but Complainant did not provide sufficient foundation to demonstrate Kelly had sufficient knowledge of concrete construction to render an informed opinion. Moreover, Complainant presented evidence intended to show that the driveway was experiencing drainage issues, which was not a complaint item that was sustained by ROC, and it was not clear from Kelly’s testimony whether her opinion was based on this unsubstantiated item.

At the hearing, Mr. Philpott testified to the effect that Respondent’s contract did not meet the statutory requirements found at Ariz. Rev. Stat. section 32-1158; that Respondent’s invoice did not include its license number proceeded by “ROC” as required by section 32-1124(B); and that Respondent had conducted work under a name other than Midstate Concrete Inc., as evidenced by Mr. Coleman’s acceptance of checks made out to him personally, in violation of section 32-1154(A)(14). Respondent did not dispute this testimony.

CONCLUSIONS OF LAW

Unless otherwise provided by law, a party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.

“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).

“At a hearing on an agency's imposition of fees or penalties or any agency compliance order, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(3).

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).

There was no substantial evidence adduced showing that Respondent is unscrupulous, unqualified, or financially irresponsible.

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 that

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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3. Violation of any rule adopted by the registrar.

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12. Failure in any material respect to comply with this chapter.

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14. Acting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth on the license.

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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.

Ariz. Rev. Stat. section 32-1158 sets out nine elements that must be set out in any contract between the owner of a property and the contractor.

Ariz. Rev. Stat. section 32-1124(B) requires a contractor to include its license number proceed by “ROC” on all invoices.

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

Ariz. Rev. Stat. section 32-1154(E) provides that ROC may impose a civil penalty of not to exceed five hundred dollars on a contractor for each violation of Ariz. Rev. Stat. section 32-1154(A)(22).

Respondent admitted that an expansion joint should have been installed and he did not dispute that there was an area with an unsightly finish. Consequently, the preponderance of the evidence shows that Respondent violated Ariz. Admin. Code section R4-9-108(A), which is also a violation of Ariz. Rev. Stat. section 32-1154(A)(3).

It has not been proven that the control joints was inadequate because Complainant did not present evidence showing how these were deficient and Mr. Coleman provided credible testimony that there were a sufficient number of control joints.

The preponderance of the evidence shows that Respondent did not comply with ROC’s Directive within the time ordered, which is a violation of subsection 32-1154(A)(22).

Mr. Philpott provided credible testimony that Respondent had violated Ariz. Rev. Stat. sections 32-1124(B) and 32-1158, which are violations of section 32-1154(A)(12), and 32-1154(A)(14). Respondent did not dispute this evidence.

Because Respondent has violated the applicable statutes, ROC has authority to discipline its license. In this case, Respondent is willing and able to make any additional repairs, which is a factor in mitigation, and the preponderance of the evidence shows that the repairs could be made by removing a small section of the concrete and adding the required expansion joint.

Considering the facts of this matter, a one day suspension for the violations of sections 32-1154(A)(3), (A)(12) and (A)(14) and a $100 civil penalty for the violation of section 32-1154(A)(22) is appropriate.

RECOMMENDED ORDER

IT IS RECOMMENDED that the Registrar suspend Respondent Midstate Concrete Inc.’s license number 328234 for one day and impose a civil penalty of $100.

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, July 21, 2021.

/s/ Thomas Shedden

Thomas Shedden

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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-137160-45720000