ALJDEC - Licensing

2022A-06654-CHC-ROC · Registrar of Contractors · 2023-06-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

William Luster,

COMPLAINANT

v.

McGrath Builders LLC

License No. ROC 312248,

RESPONDENT

No. 2022A-06654-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: April 14, 2023 and May 31, 2023 with the record held open until June 9, 2023 for the submission of written closing arguments.

APPEARANCES: Thomas Moring appeared via Google Meet on behalf of Complainant William Luster. Michael Woodlock appeared on via Google Meet on behalf of McGrath Builders LLC. Investigator Daniel Edwards appeared via Google Meet on behalf of the Arizona Registrar of Contractors.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

_____________________________________________________________________

FINDINGS OF FACT

McGrath Builders LLC (Respondent) is the holder of License No. 312248 issued by the Arizona Registrar of Contractors (Registrar).

On or about March 1, 2021, William Luster (Complainant) agreed to have Respondent repair areas of the interior of his residence resulting from an insurance claim at his residence.

On or about August 9, 2022, the Registrar received a Complaint containing thirty-two items against Respondent from Complainant alleging poor work with respect to project.

The Registrar assigned the complaint to Investigator Daniel Edwards. The jobsite inspection was performed on September 13, 2022.

Investigator Edwards then issued a written directive on or about November 15, 2022, to Respondent that provided as follows:

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 December 2, 2022.

. . .

DIRECTIVE REQUIREMENTS

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

Compliance Item: 1 - Crown molding trim in the kitchen

Investigator’s Observation: Crown molding trim is resent on site and has yet to be installed on the east side kitchen cabinets. Scope of work agreed upon appears to include this work. 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: 2 - Baseboards and trim around doors in the living room

Investigator’s Observation: Baseboards and trim were observed to have various miter joints which are not adequately flush with the adjacent pieces and gaps are present between joints. Per standards of workmanship:

"Possible Deficiency: Poor workmanship on interior trim.

Acceptable Tolerance: All joints on molding, casing, etc., should fit and be securely attached, as well as properly filled and sanded.

Contractor's Responsibility: Contractor should make necessary repairs"

All millwork in living room should be uniform with clean even joints.

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: 3 - Every single window seal

Investigator’s Observation: Complainant pointed out that window frames have cracked caulking and paint drips throughout the home.

Respondent performed drywall and paint work surrounding windows in the home. 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: 4 - Every single door trim

Investigator’s Observation: Door trim throughout the living room and adjacent rooms was observed to have paint on door trim. Respondent painted the areas surrounding these doors. As such, 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: 8 - Door into washer and dryer room half painted

Investigator’s Observation: Substantiated, door and trim are not finished. 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: 12 - Paint on the floors in many spots

Investigator’s Observation: Substantiated, paint drips present on floor at threshold from living room to east guest bedroom, on the tile at the backyard sliding door, and many paint drips also present on wood baseboards throughout the home. 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: 13 - Lights in the kitchen are not set well and you can see between the light and the ceiling

Investigator’s Observation: Substantiated, numerous lights are not flush with the ceiling. 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: 17 - Light switches and receptacles have been painted over to where they are difficult to function

Investigator’s Observation: No light switches were observed to be difficult to operate. Various outlets throughout the home were painted by respondent and show paint brushstrokes and are not fully coated. 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: 18 - Multiple receptacles come out while unplugging a plug and are exposing wires

Investigator’s Observation: Substantiated, plug on the south wall of the front room is not secured and patch work above the outlet is poor. 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: 28 - Broken back window

Investigator’s Observation: Back window is still broken, supplemental bid issued to complainant appears to include replacement (item 83. "R&R Aluminum Window, picture/fixed 33-40 sf (2 pane); For repair of broken glass that was caused by storm damage)". 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: 29 - Siding around the back window unfinished.

Investigator’s Observation: Agreement between parties specified this was to be replaced, does not appear this work was ever done. 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: 30 - Exterior siding coming up to the driveway unfinished slash untouched

Investigator’s Observation: Siding appears water damaged, agreement between parties specified this was to be replaced, does not appear this work was ever done. 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.

(All errors contained in the original).

On December 9, 2022, the Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(a), and A.R.S. § 32-1154(A)(22).

On or about December 22, 2022, Respondent submitted an Answer to the Registrar.

On or about January 11, 2023, a Notice of Hearing was issued setting a hearing on February 16, 2023 at the Office of Administrative Hearings, an independent state agency.

After a continuance, a hearing was held on April 14 and May 31, 2023.

At hearing, Investigator Edwards testified as to the Registrar’s involvement and the above timeline.

Investigator Edwards testified that there was no Compliance Jobsite Inspection performed because Respondent failed to perform any of the corrective work, and acknowledged the same in an e-mail correspondence. However, he never responded to the e-mail as it was sent on the day the Directive expired.

Further, Investigator Edwards testified that he believed that the time given on the Directive was sufficient to at least commence the work, and that Respondent also never requested an extension.

William Luster testified on his own behalf and submitted nine exhibits into evidence.

Mr. Luster testified that he suffered storm damage to his residence and his insurance claims adjuster referred him to Respondent.

Further, Mr. Luster testified as to various areas of poor workmanship, like the siding for example.

Mr. Luster testified that he met with Mr. McGrath on February 2, 2022, to give him final payment although the work was not fully completed.

Mr. Luster also testified that there was zero contact from Respondent from when the Written Directive was issued until December 2, 2022 when the Directive expired.

Respondent offered the testimony of Austin McGrath, Neal Vandbeck, Jared Schroer, and Derek Preus, and also submitted nine exhibits into evidence.

Mr. McGrath testified Mr. Luster never signed a work authorization and there was nothing in his contract which stated that the work would be performed in 30 days. Mr. McGrath testified that Mr. Luster wanted additional work to be done on the residence so he prepared a work order which was never signed by Mr. Luster. Further, in his email dated February 22, 2022, he was paid by Mr. Luster in exchange for Mr. Luster letting go of the remaining punch list items.

As to the Written Directive, Mr. McGrath testified that the same was mailed to his office and that he sincerely did not know that he needed to complete the work by the deadline. He believed that the Registrar simply needed a response by December 2, 2022. Mr. McGrath testified that he e-mailed Investigator Edwards on December 2, 2022 stating he intended to complete the work, but Investigator Edwards never responded.

Further, Mr. McGrath testified that he tried to contact Mr. Luster after December 2, 2022 to work out a time to complete the Directive work, but Mr. Luster refused.

Mr. McGrath testified that he did not believe that his license deserved to be disciplined as he was not trying to ignore the Written Directive, but rather he misinterpreted the same.

Mr. Vandbeck testified that he was Respondent’s first representative to meet with Mr. Luster. Mr. Vandbeck testified that Mr. Luster performed remediation work himself as well as some roof repairs. Mr. Vandbeck also testified that he prepared a supplemental bid for the extra work Mr. Luster requested, but it was never signed by Mr. Luster.

Mr. Schroer testified that he was the initial project manager. Mr. Schroer testified that demolition began around March 9, 2021, then Mr. Luster inquired as to having perform some additional work on the ceiling which was outside of the scope of the agreement.

Mr. Preuhs testified that he took over as project manager in August 2021. He also testified that between September 2021 and February 2022, Respondent was waiting for payment of the as 90% of the work had been completed. But Mr. Luster would not pay until everything was completed. Further, Mr. Preuhs testified that the trim around the cabinets was never installed because he believed Mr. Luster was going to use another contractor to complete the same.

Administrative notice was taken of Respondent’s prior License record on May 17, 2021. Such prior License record reflected that Respondent’s License No. 312248 was first issued on March 23, 2017, and reflected that there was one open complaint, namely the present complaint.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 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 established that Respondent’s work was not in conformity with the Registrar’s standards. The crown molding trim on the cabinets was not installed; the millwork in the living room was not uniform with even joints; the window seal caulking was cracked and paint drips; there was paint on the door trims and in some cases painting was incomplete; numerous lights were not flush with the ceiling; light switches and receptacles were painted over or some receptacle were not secured to the wall; there was a broken back window; the siding around the back window was unfinished as well as the siding coming up to the driveway was water damaged. Therefore, Complainant established that Respondent did not complete the project in a workmanlike manner in violation of A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(A).

The evidence established Respondent failed to complete the corrective work following the Directive being issued. The tribunal does not find Mr. McGrath’s testimony persuasive about the misunderstanding of the Written Directive requirements. The very first sentence read that it required the contractor to take appropriate corrective action. This meant physical action not merely submitting a response. If Mr. McGrath truly was confused by the terms he should have reached out to Investigator Edwards well before December 2, 2022. He did not, and the corrective work went unfinished. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of A.R.S. § 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 Respondent’s License No. 312248 for a period of five days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 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 A.R.S. § 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, June 26, 2023.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Martín Quezada, Director

Registrar of Contractors

Thomas S. Moring

[email redacted]

Michael S. Woodlock

[email redacted]

By: OAH Staff