ALJDEC - Licensing

2022A-05941-CHC-ROC · Registrar of Contractors · 2023-03-24

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Robert Crawford

COMPLAINANT,

Stellar Works Inc.

License No. ROC 308034,

RESPONDENT.

No. 2022A-05941-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 7, 2023

APPEARANCES: Complainant Robert Crawford (Mr. Crawford) appeared on behalf of himself. Robert McGowan appeared on behalf of Respondent Stellar Works, Inc. (Respondent).

ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson

_____________________________________________________________________

FINDINGS OF FACT

1. Respondent holds license number 308034 issued by the Arizona Registrar of Contractors (Registrar).

2. Robert McGowan is Respondent’s qualifying party.

3. On November 1, 2022, the Registrar issued a Notice of Hearing setting the above-entitled matter for hearing on December 6, 2022.

4. The November 1, 2022 Notice of Hearing provided that the complaint and citation allege that Respondent violated Arizona Ariz. Rev. Stat. sections 32-1154(A)(2)(b), 32-1154(A)(3), 32-1154(A)(22), 32-1154(A)(9)(A), and Arizona Administrative Code (A.A.C.) R4-9-108(A) and (B).

5. The Administrative Law Judge granted two motions to continue the hearing date and the hearing was held on March 7, 2023.

6. At hearing, Mr. McGowan and Gina McGowan testified on behalf of Respondent. Mr. Crawford testified on behalf of himself and presented the testimony of Veronica Lieb. Steve Philpott, the investigator that was assigned by the Registrar to investigate the complaint, testified regarding his investigation.

7. On or about February 23, 2022, Complainant and Respondent entered

into a contract wherein Respondent would remodel Complainant’s home for the amount of $24,333.

8. Complainant paid Respondent $16,000 under the contract.

9. On February 26, 2022, Respondent started work.

10. On April 12, 2022, Respondent stopped work.

11. On or about July 22, 2022, Complainant filed a complaint with the Registrar alleging poor work and abandonment on the part of Respondent.

12. On August 11, 2022, Investigator Steve Philpott conducted a job-site inspection. Investigator Philpott discovered that Respondent had not obtained permits as required by the City of Flagstaff. Investigator Philpott discovered that Respondent hired an unlicensed contractor to perform electrical work.

13. On August 29, 2022, the Registrar issued a Directive to Respondent that provided, in relevant part, as follows:

Dear Respondent:

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 September 16, 2022.

RESTRICTIONS

• You may not perform or hire other contractors to perform work that is outside the scope of your license.

• If your license is currently suspended for administrative reasons1, or is inactive, expired, or cancelled, you may not perform any corrective work nor contract in any manner, which includes hiring other contractors to perform work, until the suspension of your license(s) has been lifted or your license(s) has been reactivated.

DIRECTIVE REQUIREMENTS

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

Compliance Item: 1. Master retreat drywall not hung/floated evenly;

Investigator’s Observation: This complaint item is verified. The seam lines at the rake / ceiling / wall transition are extremely wavy. Respondent did not frame this area, however, by hanging and finishing the drywall, he has accepted the surface as being suitable for proper installation. Respondent shall correct by appropriate means.

Governing Rule: Violation of any rule adopted by the Registrar; Namely A.A.C. R4-9-108(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 such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly licensed contractor possessing ordinary skill and capacity.

Acceptance of the Surface · “As a general principle in construction, a subcontractor who performs work on top of a surface prepared by another accepts the surface. The subcontractor should have inspected the surface for any flaws or defects that would affect the work he proposes before performing the work. If he found the surface to be unacceptable, he should have called any defects to the owner’s or general contractor’s attention so that the owner can choose whether to pay for the defective surface to be corrected or if the owner is not willing to pay to correct the surface, the contractor may obtain an explicit warranty disclaimer.” Source: Deeb v. Checks Epoxy, No. 2014A-3258 (ALJ Decision at 11:11–19). The same Administrative Law Judge Decision elaborates in an extensive footnote: · “No Arizona authority addresses the Registrar’s policy that a subsequent contractor who accepts a surface prepared by an earlier contractor also accepts full responsibility for the outcome. The policy is supported by case law from other jurisdictions. See generally cases cited at “Duty of Contractor to Warn Owner of Defects in Subsurface Conditions,” 73 A.L.R.3d 1213 (1976). A contractor who knew or should have known of a defect in the surface does not perform construction in a workmanlike manner if the contractor fails to notify the owner of the defect and the construction later fails due to the defective surface. See, e.g., Parker v. Thornton, 596 So. 2d 854, 858 (Miss. 1992); Lewis v. Anchorage Asphalt Paving Co., 535 P.2d 1188, 1199 (Alaska 1975). The principle is based on common sense and a need for fair dealings between contractors and property owners: For the requirements of public order and the obligation implicit in every contract that the work will be done in a good and workmanlike manner would compel us to reject a contention that an undertaker is not responsible for building upon a site which he knows to be defective. In such a case, the barest standards of care would require him to bring the defect to the attention of the owner before proceeding. The owner would then have an opportunity to make the indicated adjustment in the contract to provide against SPS 2017.01: Collection of Guiding Cases & Authorities Version: 1.0 Date: Feb. 1, 2017 the defective soil condition of which he had no prior knowledge. . . . Wurst v. Pruyn, 202 So. 2d 268, 271-72 (La. 1967) (citation omitted).” Source: Deeb v. Checks Epoxy, No. 2014-3258 (ALJ Decision at 11:20–30).

Compliance Item: 9. Master closet/kitchenette drywall not hung/floated evenly.;

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.

Compliance Item: 13. Master closet clothing rod becomes unfastened, and clothes fall on floor.;

Investigator’s Observation: This complaint item is verified. It appears the rod support brackets have not been installed in a manner sufficient to properly support a closet rod. Respondent shall correct by appropriate means.

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.

Compliance Item: 14. Master bedroom bookshelves installed crookedly/not square.;

Investigator’s Observation: This complaint item is verified. The old existing door jamb was not removed prior to the install of the new shelving unit. The installation “as is” is considered unfinished. Respondent shall correct by appropriate means.

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. Compliance Item: 15. Baseboards and threshold reducer not installed.; Investigator’s Observation: This complaint item is partly verified. Respondent shall complete the base. 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.

Compliance Item: 18. Contractor told client no permits were necessary as he said his workmanship was above industry standards. City of Flagstaff requires them and his relied upon advice puts client at risk.;

Investigator’s Observation: Permits for this project were not obtained as required by the City of Flagstaff Building Departments. Prior to any work beginning all applicable permits shall be obtained. Unpermitted work shall be inspected by the local building inspector and any building code deficiencies identified or code violations caused by the Respondent shall be corrected. All required inspections shall be scheduled and passed. Completed project must comply with original contract agreement, properly executed change orders, local building codes, and manufactures installation instructions.

Governing Rule: §32-1154. Grounds for suspension or revocation of license; continuing jurisdiction; civil penalty; recovery fund award A. 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: 2. Departure from or disregard of: (a) Plans or specifications in any material respect that is prejudicial to another without consent of the owner or the owner's duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code. (b) A building code of this state or any political subdivision of this state in any material respect that is prejudicial to another. 3. Violation of any rule adopted by the registrar. RULE 4-9-108 WORKMANSHIP STANDARDS A. A contractor shall perform all work in a professional manner. 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 such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly licensed contractor possessing ordinary skill and capacity

Compliance Item: 27. Contractor never inspected work in progress/completed work with client and he/his sons tore up the walls around the bookcases, closed off an electrical circuit, (he assured us it was safe) still unsure if it is.;

Investigator’s Observation: This complaint item is verified. Permits for this project were not obtained as required by the City of Flagstaff Building Departments. Prior to any work beginning all applicable permits shall be obtained. Unpermitted work shall be inspected by the local building inspector and any building code deficiencies identified or code violations caused by the Respondent shall be corrected. All required inspections shall be scheduled and passed. Completed project must comply with original contract agreement, properly executed change orders, local building codes, and manufactures installation instructions. Additional, the electrical work was performed by Henry Rodriguez, an unlicensed individual. Respondent shall have electrical work evaluated by a properly licensed electrician. Any building code deficiencies identified or code violations caused by the unlicensed individual, Henry Rodriguez shall be corrected. (Respondent shall provide the ROC with contact information on Rodriguez)

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 such skills, prudence, and diligence in performing and completing tasks undertaken that the completed work meets the standards of a similarly licensed contractor possessing ordinary skill and capacity. 9. Attempting to evade this chapter by: (a) Aiding or abetting a licensed or unlicensed person.

Errors in original only.

14. Respondent did not comply with the Directive.

15. On September 22, 2022, the Registrar issued a Citation to Respondent alleging that Respondent had violated Arizona Ariz. Rev. Stat. sections 32-1154(A)(2)(b), 32-1154(A)(3), 32-1154(A)(22), 32-1154(A)(9)(A), and Arizona Administrative Code (A.A.C.) R4-9-108(A) and (B).

16. On September 24, 2022, Mrs. McGowan notified Investigator Philpot by

e-mail that Respondent would not return to Mr. Crawford’s home because she and

Mr. Gowan did not feel comfortable in Mr. Crawford’s home.

17. On October 6, 2022, Mr. McGowan filed a timely answer to the Citation on behalf of Respondent. Mr. McGowan stated in his answer:

To Whom it may concern, After receiving the registrar’s list of items that needed to be rectified, I reached out to the clients with what I felt was a reasonable solution; I proposed with tensions running high between each party, I would not charge them the remaining balance of 6430.00 (which she told me she doesn't owe me and will not pay me) which then could be use to hire a different contractor. They declined. I made my decision as well, I am NOT going back into that toxic environment. Veronica told me that she suffers from mental illness and takes a lot of medication to keep it under control. I would assume that was why the scope of the work she wanted me to do would change daily. She told me at the beginning of the job that if I found any gold during the remodel, I was to give it to her. During demo, she was right there with me looking for the gold! When I installed the custom made bookcase by cutting out carpet around it, I received a text from her at 9:30 at night. She told me "If you found the gold, then we need to talk". She thought when I cut the carpet for the install of the book case that I was in fact actually looking for gold when she wasn't around! There was also plenty of evidence of substance abuse. And lastly, Rob was showing my son his gun collection. He let my son HOLD his AR15, and showed him two other guns that he told my son he kept6loaded. So, based on these events, I feel it is more than fair on my end to forego the remaining balance of what they owe me, let them hire someone else to fix the issues with that remaining money owed on their bill. I will not enter the premises with all those issues I mentioned above. I DO NOT FEEL safe. Honestly, I have never in my 24 years of being a licensed contractor experienced anything as bizarre and strange as this situation! I also apologize for not hiring other licensed subs. I will definetly be more attentive to that in the future. I truly appreciate the warning. Sincerely, Robert McGowan

Errors in original only.

18. Mr. McGowan explained that 95% of the project is completed.

Mr. McGowan explained that he did not frame and hang drywall, but rather, taped and textured the existing drywall. Mr. McGowan stated that he did not feel comfortable at

Mr. Crawford’s home because there were automatic guns in the work area.

19. Mr. McGowan stated that he would go back to the Crawford’s home “today” if he wanted him to come back. Mr. McGowan stated that when he left the job, he communicated that he was done at that time and needed to wait for flooring.

Mr. McGowan stated that baseboards should have been installed after flooring in one area.

20. Mr. McGowan stated that the homeowners continually changed their mind about construction. Mr. Gowan alleged that the homeowners originally wanted carpet in the rooms and later requested hardwood or vinyl planking.

21. Mr. McGowan stated that he told the Mr. Crawford that he would not pull any permits and that the homeowner would be required to pull permits. Mr. McGowan stated that Ms. Lieb told her that her that husband flips houses “all the time.”

22. Mr. McGowan stated that he could have completed the repairs in approximately two days, but he wanted to “wash his hands”. Mr. McGowan offered to pay Mr. Crawford the money required to correct the Directive items.

23. Mrs. McGowan stated that Mr. Crawford gave her son a gun to hold and she was uncomfortable.

24. Ms. Lieb stated that she was only joking when she made references to finding gold. Ms. Lieb stated that in the summer of 2022, she and Mr. Crawford had COVID and could not meet with Respondent’s representatives at that time.

25. Administrative notice is taken of Respondent’s prior License record as

reflected on the Registrar’s public website on March 24, 2023. Such prior License record reflects that Respondent’s License No. ROC 308034 was issued on August 31, 2016 and is currently active. Such prior License record shows that the Registrar has never disciplined Respondent’s license.

26. Respondent’s lack of disciplinary history is considered a mitigating factor in the imposition of discipline and penalties.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See Ariz. Rev. Stat. sections 32-1101 et seq.

Complainant bears the burden of proof to establish Respondent’s statutory violation by a preponderance of the evidence. See Ariz. Rev. Stat. section 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); see also Vazanno 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 shows that Respondent did not

obtain the required permits for the project before beginning construction, which is a violation of Ariz. Rev. Stat. section 32-1154(A)(2)(b).

The preponderance of the evidence shows that Respondent did not

perform the work in a professional and workmanlike manner, which is a violation of A.A.C. R4-9-108(A), and thereby of A.R.S. § 32-1154(A)(3).

5. The preponderance of the evidence shows that Respondent did not

perform work in accordance with all applicable building codes and professional industry standards, in violation of A.A.C. R4-9-108(B), and thereby of A.R.S. § 32-1154(A)(3).

6. The preponderance of the evidence shows that Respondent aided or abetted an unlicensed person, which is a violation of Ariz. Rev. Stat. section 32-1154(A)(9)(A).

7. The preponderance of the evidence shows that Respondent failed to comply with the Registrar’s Directive without valid justification, which is a violation of Ariz. Rev. Stat. section 32-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Order, the Registrar shall suspend License No. 324892 issued to Stellar Works Inc., for one day. It is further recommended that the Registrar require Respondent to pay the sum of $250.00 as a civil penalty pursuant to Ariz. Rev. Stat. section 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 Ariz. Rev. Stat. section 32-1101(A)(7), unless Respondent tenders payment of any outstanding prior civil penalty.

Pursuant to A.R.S. § 41-1092.08(I), the licensee may accept the Administrative Law Judge Decision by advising the Office of Administrative Hearings in writing not more than ten (10) days after receiving the decision. If the licensee accepts the Administrative Law Judge Decision, the decision shall be certified as the final decision by the Office of Administrative Hearings.

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 forty (40) days from the date of that certification.

Done this day, March 24, 2023.

/s/ Velva Moses-Thompson

Administrative Law Judge

Transmitted electronically to:

Martín Quezada, Director

Registrar of Contractors

[email redacted]

Steve Philpott

[email redacted]

Robert Crawford

[email redacted]

Stellar Works, Inc.

[email redacted]

By: OAH Staff