ALJDEC decisions subject to certification as final

2021A-06075-CHC-ROC · Registrar of Contractors · 2022-09-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Georgena L Alvarez,

COMPLAINANT

v.

Strong Tower Construction LLC,

License No. ROC 221291,

RESPONDENT

No. 2021A-06075-CHC-ROC

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: September 12, 2022

APPEARANCES: Sydney Brewer, Esq. for Complainant; no one appeared for Respondent

ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT

On March 10, 2022, the Registrar of Contractors (“ROC”) issued a Notice of Hearing on Contested Case setting the above-captioned matter for hearing on April 19, 2022.

Through its Notice of Hearing, ROC alleges that Respondent Strong Tower Construction LLC may have violated Ariz. Rev. Stat. sections 32-1154(A)(3) and (A)(22). Respondent holds license No. 221291 issued by ROC in June 2006.

Complainant Georgena L. Alvarez suffered fire damage to her home and she and her husband hired Respondent to make repairs.

On April 19, 2022, the parties agreed to mediate the dispute. The mediation was not successful and the matter was continued several times. The hearing was scheduled to convene at 9:00 a.m. on September 12, 2022. No representative appeared for Respondent and the matter was convened in its absence at about 9:18 a.m.

Complainant and ROC’s Wes Ellington testified at the hearing.

Through a telephone call on the afternoon of September 12th, Respondent’s attorney informed the tribunal that he had mis-calendared the hearing.

On September 13, 2022, Respondent’s attorney filed an Explanation for its failure to appear at the hearing in which the attorney explained that Respondent was not at fault for its failure to appear, but rather the fault was entirely that of the attorney. Respondent requested that the tribunal consider the entire record, including Respondent’s Answer to ROC’s Citation found in the administrative record that ROC provided the tribunal and the parties.

On or about March 15, 2021, the parties entered a contract calling for Respondent to repair the fire damage at Complainant’s house with Complainant to make payments within five days of her receipt of insurance proceeds.

Complainant filed with ROC a complaint against Respondent alleging poor work on Respondent’s part and alleging that Respondent had failed to provide materials of the quality required by the contract.

Complainant’s complaint shows the contract price as $169,428.45, whereas Respondent’s Answer to ROC’s Citation shows the price as $137,498.63. As of the hearing date, Complainant had paid Respondent $40,000.

ROC investigator Mr. Ellington conducted a jobsite inspection on December 22, 2021.

On January 5, 2022, ROC issued to Respondent a Directive that provided in part:

*** You must notify the Registrar’s assigned Investigator of your compliance with this Directive prior to 5:00 p.m. on January 24, 2022.

RESTRICTIONS

***

DIRECTIVE REQUIREMENTS

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

Complaint Item: 1) AC unit down graded and installed by unlicensed worker as well installed incorrectly causing severe fire hazard not safe exposed wires can cause someone to be electrocuted.

Investigator’s Observation: There was no evidence to show the A/C units are downgraded. The Respondent stated that the installer is not licensed and is working under the license of Venair Heating and Air Conditioning LLC, ROC 294528. The Respondent was advised that this is an illegal practice and that the license cannot be loaned out to an unlicensed entity. The Complainant has provided 3 reports from different HVAC companies showing deficiencies with the installation of these units.

The HVAC units are not currently functional and there are exposed wiring issues in the attic/air handler area. The Respondent will need to correct these issues by the meets all building codes (wiring, etc) and address the issues in the 3 reports provided by the Complainant. 2) Finish the installation and make the HVAC system function properly. 3) Used an appropriately licensed HVAC subcontractor to complete the work.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 2) Electrical issues with house being wire incorrectly by unlicensed worker

Investigator’s Observation: Verified. Some issues are due to the job not being completed (new smoke detectors, etc), others need to be corrected (flickering lights, etc). The Respondent will need to correct these issues by the appropriate means, using an appropriately licensed contractor (original sub, EZLN is appropriately licensed, ROC 208550).

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 3) carpet down graded performed work by an unlicensed person that was a family member of his to cut cost and caused carpet down graded and installed incorrectly and not properly secured and padding not glued and down graded padding. contractor used family member to save money to cut cost. he was given opportunity to mcoake it right and hes holding back on getting a professional reputable company

Investigator’s Observation: The Complainant provided no evidence that the carpet was downgraded. The Respondent stated he used his brother who works for a carpet company to install the carpet.

The carpet pad is not secured (glued) to the floor in all locations to prevent shifting. The edges are not tucked and secured properly. The Respondent will need to have all carpet pad secured, the carpet properly stretched and secured to the edges by an appropriately licensed subcontractor.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 4) House was painted poor quality contractor hired unlicensed painter, house is peeling every where dirt and dust was painted over was suppose to be cleaned and prepped and primered ands sealed but he had worker cut corners and ruined my house

Investigator’s Observation: Verified. The walls were not properly prepped for paint which resulted in a rough surface with debris under the paint. Primer was

obviously not applied, proven by a major amount of peeling at the pony wall at the top of the stairs as well as various places on the walls. Smoke from the fire damage is also bleeding through the paint, additionally proving lack of prep and/or primer. The Respondent will need to correct these issues by the appropriate means, using an appropriately licensed contractor, or qualified employee of the company.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 5) lights installed in in ceiling exposed gaps, as well hazardous

Investigator’s Observation: Verified. The Respondent will need to correct this by the appropriate means, using an appropriately licensed contractor.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 6) smoke detectors were installed new but constanty keeps going off continuously, even when old ones was still inplace ever since he had his worker working on the wiring of my house.

Investigator’s Observation: Verified. The respondent stated that the smoke

detectors had not been replaced because the work was not yet finished. The Respondent will need to correct this by the appropriate means, using an appropriately licensed contractor.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 7) besides the issues with the AC not all my ducts are knew he reused my old ducts and ,y insurance is paying 29,814.78 to replace with knew and he down graded everything and used old parts. I had a house fire and its a must to have all knew ducts.

Investigator’s Observation: Verified. The Respondent stated that several ducts had not yet been replaced. This is an important issue after a fire. The Respondent will need to correct this using new materials by the appropriate means, using an appropriately licensed contractor.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 10) he replace 2 windows and not completed its unsafe and can cause my children to cut there fingers. and fix another window that his worers to pieces off of which we dont know why they did that.

Investigator’s Observation: Verified. The Respondent will need to correct this by the appropriate means, using an appropriately licensed contractor, or a qualified employee.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

Complaint Item: 11) all closets in the house is missing the tracts to keeps closet

Investigator’s Observation: Verified. The Respondent will need to correct this by the appropriate means.

Governing Rule: Workmanship Rule: ARS §32-1154 (A) (3), namely R4-9-108, Poor work not performed in accordance with professional industry standards.

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item: 8) The contractor provided poor quality on all work performed to cut cost as well put us in harms way by trying to cut cost

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: N/A

Complaint Item: 9) we gave the contractor plenty of times to correct all issues and he choses to with hold his part of the contract by still trying to provide poor quality of work

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: N/A

Complaint Item: 12) the contractor been delaying the completion of my house to try to bargain cost

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: N/A

Complaint Item: 13) there was alot of other work that was suppose to be performed and he chose to cut corners instead of doing the work the right way.

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: N/A

Complaint Item: 14) he had many chances to correct the issues .

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: N/A

Respondent hired licensed contractors to repair Complaint Items 1 (Cool Blew Inc., #176357), 2 (EZLN Electric, #208550), 3 (Cranmore Flooring Sales, #317468), 6 (EZLN Electric), and 10 (Century Glass & Mirror, #288494), and it conducted repairs on Complaint Items 4 and 5. It is not clear who repaired Complaint Items 7 and 11.

On February 7, 2022, Mr. Ellington conducted a compliance jobsite inspection based on which he made the following findings:

***

Compliance Findings:

Complaint Item: 1) ***

Compliance Findings: In the attic, I found that there are still exposed wires (low voltage) coming from one unit that should have been secured/terminated properly. This was part of the directive and was not completed. The Complainant stated that the unit was not working properly and makes noise. This was not demonstrated at the inspection.

NOT CORRECTED

Complaint Item: 2) ***

Compliance Findings: There was discussion about how the ceiling fans have been wired. This is normal for a fan with a built in remote control. With this type of ceiling fan, only one wall switch is used.

The Complainant pointed out that some of the smoke detectors mounting plates had not been replaced. This in itself would not constitute poor workmanship as long as the smoke detector units were replaced. However, upon testing the smoke detectors, I found that they are not all interconnected (when one detector goes off, they all sound) as required by building code.

NOT CORRECTED

Complaint Item: 3) ***

Compliance Findings: The Complainant pulled the carpet back and showed that the pad had not been secured and there is a large gap (approximately 1”) between the two adjoining pads. This item was not corrected as required.

NOT CORRECTED

Complaint Item: 4) ***

Compliance Findings: The Complainant felt that the Respondent had still not prepped the walls before painting. The Respondent gave the details of how the prep was done which was evident by the walls no longer having a rough, gritty feel. There was only one area pointed out by the Complainant next to the master shower entrance where the peeling paint underneath was still showing through. All other areas are acceptable.

NOT CORRECTED

Complaint Item: 5) ***

Compliance Findings: The upstairs recessed lights were repaired with drywall compound to fill the exposed gaps, but were not sanded and painted. Additionally, the light inserts are not designed for this recessed can and will not stay flush to the ceiling. The Complainant showed the downstairs lights that are a newer style of LED light that requires no housing. This was acceptable, however, the removal of the fixture revealed that the junction boxes were incorrectly wired with no wire restraint and exposed wiring coming from the box. This is a hazard and is unacceptable.

NOT CORRECTED

Complaint Item: 6) ***

Compliance Findings: This was covered in item 2:

The Complainant pointed out that some of the smoke detectors mounting plates had not been replaced. This in itself would not constitute poor workmanship as long as the smoke detector units were replaced. However, upon testing the smoke detectors, I found that they are not all interconnected (when one detector goes off, they all sound) as required by building code.

NOT CORRECTED

Complaint Item: 7) ***

Compliance Findings: The Complainant felt that all the ductwork had not been replaced. The Respondent assured that it had been replaced and stated they even had found two that they were not aware of and replaced them. There was insufficient evidence to prove the ductwork was not replaced. At the end, the Complainant (husband) agreed it had been replaced after all.

CORRECTED

Complaint Item: 10) ***

Compliance Findings: The Respondent stated that he had the window company scheduled to do the work when the directive expired and the Complainant did not want to give him more time. The Complainant did not want to extend the directive further and feels that the Respondent had plenty of

time finish the job, but was trying to get a better deal. The work was not completed.

NOT CORRECTED

Complaint Item: 11) ***

Compliance Findings: The Complainant agreed that this was completed.

CORRECTED

Mr. Ellington’s testimony was consistent with his written Investigator’s Observations and Compliance Findings.

ROC issued to Respondent a Citation dated February 9, 2022, through which ROC alleges that Respondent may have violated Ariz. Rev. Stat. sections 32-1154(A)(3) and (A)(22).

On February 23, 2022, Respondent filed an Answer to ROC’s Citation though which it provided the names and license numbers of the subcontractors it had hired to make the repairs ROC ordered it complete. Respondent acknowledged that ROC had determined that these subcontractors had not fully completed the repairs that ROC ordered and that there was a small section of Respondent’s painting work that also required further correction. Respondent asserted that it and the subcontractors were willing and able to complete all required corrections, but Complainant was not willing to allow access.

In its Answer to the Citation Respondent asserted that Complainant owes Respondent in excess of $87,000 as seen in an attached spreadsheet, and it argued that Complainant’s intention was not to be made whole, but rather to receive a windfall.

ROC’s Substantive policy statement 2017.01 shows that the parties to a contract have an obligation to cooperate, for example by allowing the contractor access to complete work, and that the right to cure is implied in every contract.

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).

Substantive policy statement means:

[A] written expression which informs the general public of an agency's current approach to, or opinion of, the requirements of the federal or state constitution, federal or state statute, administrative rule or regulation, or final judgment of a court of competent jurisdiction, including, where appropriate, the agency's current practice, procedure or method of action based upon that approach or opinion. A substantive policy statement is advisory only....

Ariz. Rev. Stat. § 41-1001(24).

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).

It has not been proven 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:

*****

3. Violation of any rule adopted by the registrar.

*****

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

The preponderance of the evidence shows that as set out in ROC’s Directive, some of Respondent’s and its subcontractors’ work did not meet the workmanship standards. The Directive also shows however, that some of the Complaint Items were more properly considered uncompleted work, rather than deficient work. Respondent violated 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 Respondent violated Ariz. Rev. Stat. section 32-1154(A)(22) because it did not comply with ROC’s Directive within the time ordered. The preponderance of the evidence also shows however that Respondent and its subcontractors made some repairs and are willing and able to complete the remaining repairs.

Ariz. Rev. Stat. subsection 32-1154(B)(3) provides that ROC “May temporarily suspend ... or permanently revoke any or all licenses issued under this chapter if the holder of the license ... commits any of the acts or omissions set forth in” subsection 32-1154(A).

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).

The Administrative Law Judge may consider a contractor’s prior record when determining the appropriate discipline. Ariz. Admin. Code § R4-9-117.

Although ROC identified some workmanship deficiencies, it also noted that some complaint items were better seen as incomplete work, not deficiencies. Respondent and its subcontractors stand ready to repair any items ROC has identified, but Complainant will not allow access. There is no dispute that Complainant has paid Respondent only $40,000 of the contract price, whether that be $137,498.63 or $169,428.45, indicating that this matter is best seen as a contract dispute. Implied in the contract is Respondent’s right to cure. Respondent has been licensed since 2006 and ROC’s website shows no other complaints against Respondent’s license. Consequently, it is appropriate to dismiss this matter without imposing discipline against Respondent’s license.

RECOMMENDED ORDER

IT IS ORDERED that case number 2021-06075 is dismissed.

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, September 23, 2022.

/s/ Thomas Shedden

Thomas Shedden

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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-137160-45720000By Miranda Alvarez

Legal Secretary