ALJDEC decisions subject to certification as final

2021A-00627-CHC-ROC · Registrar of Contractors · 2021-09-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Patricia Elizabeth Diedrick,

COMPLAINANT,

v.

Mexican Tile Restoration Inc.,

ROC License No. 139742,

RESPONDENT.

No. 2021A-00627-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: September 07, 2021 at 1:00 PM.

APPEARANCES: Patricia Diedrick (“Complainant”) appeared on her own behalf. Rod Galarza, Esq. appeared on behalf of Mexican Tile Restoration, Inc. (“Respondent”) with David Richardson as a witness. Steve Nelsen appeared on behalf of the Arizona Registrar of Contractors (“Registrar”). Terry Diedrick, José Arturo Gonzalez and Robert Tomizcuk observed.

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

_____________________________________________________________________

Having heard the evidence and testimony and having considered the record in this matter, the undersigned Administrative Law Judge hereby makes the following Findings of Fact and Conclusions of Law and issues the following Recommended Order to the Director of the Registrar.

FINDINGS OF FACT

Background and Procedure

On October 28, 1998, the Registrar issued License No. 139742 for Specialty Dual CR-5 contracting, as restricted by the Registrar, to Respondent. Respondent’s address of record for the license is PO Box 13927 Scottsdale, AZ 85267-3927. David Henry Richardson is listed as the Qualifying Party and Officer on the license, and Eric Mark Richardson is listed as an Employee on the license.

Pursuant to Ariz. Admin. Code R4-9-117 Administrative Notice is taken of Respondent’s prior license record, for ROC License No. 139742, as reflected on the Registrar’s public website. Such prior license record reflects that Respondent’s license is active and currently renewed through October 31, 2022. The license is in good standing and has not been previously disciplined. The record reflects that there is one open complaint against Respondent’s license, which is presumed to be related to this matter. Respondent has a $10,000.00 surety bond for the license issued through American Contractors Indemnity Company, effective April 09, 2014.

On or about February 12, 2021, the Registrar received Complaint 2021-00627, a single issue complaint, filed by Complainant alleging poor work performance on a residential outdoor tile sealing project. Attached to the complaint were copies of the parties’ $1,600.00 contract and proof of payment.

On February 17, 2021, the Registrar issued a Jobsite Inspection Notification letter to the parties, advising that an onsite review would be conducted at the project site by an investigator on March 10, 2021, at 10:30 a.m.

On February 18, 2021, the Registrar issued a Rescheduled Jobsite Inspection Notification letter to the parties, advising that an onsite review would be conducted at the project site by an investigator on March 16, 2021, at 10:30 a.m.

On February 18, 2021, Registrar investigator Albert Bernal (“Investigator Bernal”) reviewed the contract agreement between the parties, inspected the work that had been done on the projects to date, and took 29 photographs of the project. When he was finished, Investigator Bernal drafted Jobsite Inspection Notes. Ultimately, Investigator Bernal substantiated Complainant’s single complaint item. Specifically, Investigator Bernal found that Respondent’s newly applied sealing to Complainant’s Saltillo tile was flaking off of the surface throughout the covered patio area, and that various tiles appeared different in color. Investigator Bernal determined that the project was in need of remediation by Respondent.

On March 25, 2021, Investigator Bernal issued a Written Directive from the Registrar (“Directive”) to Respondent based on the workmanship allegations he substantiated during his jobsite inspection. Respondent was put on notice that he had until 5:00 p.m. on April 26, 2021, to notify the Registrar of its compliance with the Directive or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108, 32-1154(A)(22), and 32-1154(E).

On May 03, 2021, Investigator Bernal issued a Compliance Jobsite Inspection Notification letter to the parties, advising that an onsite review would be conducted at the project site on May 05, 2021, at 10:00 a.m.

On May 04, 2021, Investigator Bernal issued a Rescheduled Compliance Jobsite Inspection Notification letter to the parties, advising that an onsite review would be conducted at the project site on May 06, 2021, at 3:30 p.m.

On May 06, 2021, Investigator Bernal inspected the workmanship complaint item previously identified for remediation. When he was finished, Investigator Bernal drafted Compliance Jobsite Inspection Notes. Ultimately, Investigator Bernal determined that the underlying complaint item remained at issue and had not been satisfactorily remediated by Respondent. Investigator Bernal noted that in his attempt to remediate the underlying complaint item, Respondent failed to complete any repairs and actually caused damage to Complainant’s tiled patio floor. Specifically, during Respondent’s attempt to brush away and pressure wash the seal, he cased deep scratches, marks, and further discoloration which resulted in the tiles having a rough and inconsistent texture.

On May 17, 2021, Investigator Bernal escalated Complaint 2021-00627 to the Registrar’s legal department with a Citation Recommendation.

On May 19, 2021, the Registrar issued a Citation to Respondent for alleged violations of Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108(a), and 32-1154(A)(22). Respondent was given until June 03, 2021, to respond with its Answer or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1155.

On May 31, 2021, the Registrar received Respondent’s Answer. Respondent opined that the manufacturer had “under fired” Complainant’s batch of tiles and/or the installers had “pressure washed the daylights out of it” and used too much grout. Respondent offered that his opinions were supported by “aficionados” he had consulted. Respondent argued that he would not pay for the demolition and installation of new tile, and that all he had wanted to do was remove the seal and return Complainant’s $1,600.0.

On June 09, 2021, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on July 28, 2021. Per the June 21, 2021, Notice of Hearing on Contested Case (“Notice of Hearing”) the issues to be determined are whether the Registrar has cause to discipline Respondent’s license based on the following charges:

Charge 1: A.R.S. § 32-1154(A)(3) – A.A.C. R4-9-108(a)

Charge 2: A.R.S. § 32-1154(A)(22)

Hearing Evidence

Complainant called Steve Nelsen – Chief of Investigations as a witness, testified on her own behalf, and admitted Exhibits 2, 6-8 and 12 into the record. Respondent called David Richardson as a witness. The Registrar’s agency file and Notice of Hearing were admitted into the record as their own exhibits. The substantive evidence of record is as follows:

Complainant owns residential property located at 605 E. Mesquite Ave. Gilbert, AZ 85296.

On November 22, 2020, the parties entered into a $1,600.00 contract whereby Respondent agreed to seal Complainant’s 800 square foot outdoor tiled patio in epoxy. Complainant paid for the contract in full.

The tile on Complainant’s patio is Tecate; a porous, individually hand-painted, clay tile.

Work on the project commenced on November 22, 2020, and was completed that same day.

Complainant kept the area clear the following week, and did not walk or move furniture over the tiles.

Respondent returned to the job site approximately five days later, per Complainant’s request, regarding “swish marks” on the tile. Respondent performed “touch-ups” and told Complainant that eventually it would all “blend in” together.

Respondent was again called back to the property after Complainant reported “flaking” in some tiles along the perimeter of the patio. Respondent advised Complainant that epoxy was only applied to the top of the tiles and not the sides, and opined that rain water seeped into the tiles and caused a breakdown of the tiles including discoloration.

Complainant again complained to Respondent about the tiles “flaking” and Respondent retorted “That’s just what happens.”

Complainant proposed that the parties meet with a representative from the tile manufacturer. Respondent declined.

The epoxy Respondent used for the underlying project was for indoor projects. He did not perform a test on one of Complainant’s outdoor tiles prior to moving forward with the application on all of the tiles.

Respondent offered to refund Complainant’s contract payment. Complainant declined.

The parties did not enter into a financial agreement to settle their dispute.

A prehearing jobsite inspection was not scheduled in this matter.

Respondent declined to provide a closing argument.

In closing, Complainant argued that Respondent should compensate her for the cost of demolition and reinstallation of the Tecate tiles on her patio, and that Respondent should also refund the cost of their contract. In total, Complainant opined that she was owed approximately $15,049.91 from Respondent.

CONCLUSIONS OF LAW

The Registrar has jurisdiction over this matter pursuant to Ariz. Rev. Stat. §§ 32-1101 et seq. and 32-1154(A). The matter was properly brought before OAH pursuant to Ariz. Rev. Stat. §§ 41-1092 et seq.

The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors.

The Registrar may resolve contractual disputes if such resolution in ancillary to its regulatory mission and may penalize a contractor’s license by ordering payment of restitution if a proven statutory violation was not remedied by corrective action.

Complainant bears the burden of proof to establish cause to discipline Respondent’s license by a preponderance of the evidence. Respondent bears the burden to establish factors in mitigation of the penalty and affirmative defenses 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.”

Ariz. Rev. Stat. § 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.”

Ariz. Admin. Code 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.”

Ariz. Rev. Stat. § 32-1154(A)(22) provides, 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.”

The material facts in the case at bar are clear.

It is clear that the parties had a residential outdoor tile sealing contractual agreement for which Complainant paid Respondent in full. It is also clear that a result of Respondent’s poor workmanship, the Registrar issued a Directive that required compliance by April 26, 2021. It is further clear that at the time of the underlying compliance jobsite inspection, Respondent had failed to complete any repairs and had actually caused more damage to the tiled patio floor.

Therefore, the only issue in dispute is whether Respondent raised a sufficient justification or excuse for failing to adhere to the Registrar’s Directive and complete Complainants’ project per contract. This is an affirmative defense that Respondent bears the burden to establish.

Here, Respondent’s opinions, that the manufacturer “under baked” Complainant’s tiles and/or that the installer had acid washed the tiles, were not credible as they were not corroborated by any supporting evidence. Thus, Respondent did not sustain his requisite burden of proof.

Because Complainant established violations of Ariz. Rev. Stat. §§ 32-1154(A)(3); Ariz. Admin. Code R4-9-108, and 32-1154(A)(22), Complainant has also established cause for the Registrar to discipline Respondent’s contractor’s license.

Complainant may petition the Registrar’s Recovery Fund for financial recompense regarding this matter.

RECOMMENDED ORDER

Based on the foregoing,

IT IS RECOMMENDED that five days after the effective date of the Final Order in this matter, Respondent Mexican Tile Restoration Inc., ROC License No. 139742, be suspended for two (2) days based on its violations of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22).

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, September 29, 2021.

Office of Administrative Hearings

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors