ALJDEC - Licensing
2022A-10054-CHC-ROC · Registrar of Contractors · 2023-04-17
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Mary Engebretsen,
COMPLAINANT,
v.
Nation's Floor Covering LLC
ROC License No. 300147,
RESPONDENT.
No. 2022A-10054-CHC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: March 29, 2023 at 1:00 PM.
APPEARANCES: Mary Engebretsen (“Complainant”) appeared on her own behalf. Marilyn Nation appeared on behalf of Nation’s Floor Covering LLC (“Respondent”). Mike Springer appeared on behalf of the Arizona Registrar of Contractors (“Registrar”).
ADMINISTRATIVE LAW JUDGE: Jenna Clark.
_____________________________________________________________________
After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Recommended Order to the Director of the Registrar.
FINDINGS OF FACT
Background and Procedure
Pursuant to Ariz. Admin. Code R4-9-117, Administrative Notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website. On July 14, 2015, the Registrar issued ROC License No. 300147 Specialty Dual CR-8 Floor Covering contracting to Respondent. The license is currently active and renewed through July 31, 2023. Marilyn Jane Nation is the Qualifying Party and Member on the license. Respondent has an active $6,750.00 surety bond on the licensed issued by Western Surety Company effective June 24, 2015. There is no prior discipline noted for the license, save one open complaint which is presumably Complainant’s.
On November 01, 2022, the Registrar received a 1-item complaint from Complainant against Respondent’s License No. 300147 alleging poor workmanship of their flooring project. The Registrar designated it Complaint No. 2022-10054 and assigned to Mike Springer (“Investigator Springer”) for investigation.
On November 02, 2022, Investigator Springer issued a Jobsite Inspection Notification Letter to the parties, advising that he would conduct an inspection of the project on December 08, 2022, at 10:00 a.m.
On November 02, 2022, Investigator Springer also issued a Warning Letter to Respondent for an alleged violation of Ariz. Rev. Stat. § 32-1158(A) for Respondent’s failure to include all nine (9) required minimum elements in her contracts, including her contract with Complainant.
On December 08, 2022, Investigator Springer conducted a review of the contract executed between the parties and inspected the work that had been performed on the project to date. He also took 16 photographs of the project site. When he was finished, Investigator Springer drafted his Inspection Notes. Ultimately, Investigator Springer substantiated the complaint item. Specifically, Investigator Springer observed that the floor planks had random gaps throughout the residence, and that planks in the kitchen and living room were cupped and bowed. Investigator Springer concluded that Respondent’s flooring installation failed to meet the Registrar’s minimum workmanship standards.
On December 08, 2022, Investigator Springer issued a Written Directive from the Registrar (“Directive”) to Respondent because he substantiated Complainant’s sole workmanship allegation against Respondent. Respondent was put on notice that she had until 5:00 p.m. on January 09, 2023, to notify the Registrar of her compliance with the Directive or face discipline pursuant to Ariz. Admin. Code R4-9-108, and Ariz. Rev. Stat. §§ 32-1154(A)(3), 32-1154(A)(22) and 32-1154(E).
On January 17, 2023, Investigator Springer forwarded the matter to the Registrar’s legal department with the issuance of a Citation Recommendation.
On January 20, 2023, 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), 32-1154(A)(12); 32-1158, and 32-1154(A)(22). Respondent was given until February 04, 2023, to respond with her Answer or face discipline pursuant to Ariz. Rev. Stat. §§ 32-1154(A)(22) and 32-1155.
On February 04, 2023, the Registrar received Respondent’s Answer. Essentially, Respondent argued that the product used on Complainant’s project was defective. In pertinent parts, Respondent noted that she had hired a flooring inspector and photographer to draft reports to submit to the flooring manufacturer (“Mohawk”), as her prior request to have materials replaced by Mohawk per its limited lifetime warranty had been denied.
On February 06, 2023, the Registrar referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on March 29, 2023. Per the February 23, 2023, Notice of Hearing the issues to be determined are whether the Registrar has cause to discipline Respondent’s license based on the following alleged statutory violations:
Charge 1: A.R.S. § 32-1154(A)(3) – A.A.C. R4-9-108
Charge 2: A.R.S. § 32-1154(A)(12) – A.R.S. § 32-1158
Charge 3: A.R.S. § 32-1154(A)(22)
Hearing Evidence
Complainant testified on her own behalf and called Investigator Springer, as a witness. Marilyn Nation testified on behalf of Respondent and submitted Exhibit A. 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 manufactured residential property located at 6685 E. Thuma Rd. Sierra Vista, AZ 85650.
On or about September 21, 2020, Complainant and Respondent entered into a $13,698.38 for the installation of 1,799.20 square feet of LVP flooring at Complainant’s residence. Complainant paid the contract in full. The project commenced on or about September 21, 2020, and was completed on or about November 09, 2020.
Complainant installed the vents and trim. Respondent only installed the flooring.
A representative from Mohawk was present for Investigator Springer’s jobsite inspection. All parties present agreed that the flooring was “cupping and gapping.” David Esquival, District Manager for Mohawk, took samples of the flooring, and gave Ms. Nation verbal assurances that the issues would be covered under the company’s warranty.
Investigator Springer did not deduce that there was a patent or latent defect in the materials.
On an unknown date, Respondent filed a claim with Mohawk on behalf of Complainant under the company’s limited lifetime warranty, which carries a “No Gap Guarantee” and assures ”core construction [of materials] prevents cupping and gapping due to moisture or temperature changes.” Mohawk also purports that materials are “100% waterproof.”
On January 09, 2023, Mohawk denied Respondent’s claim.
On February 17, 2023, Respondent’s flooring inspector, CSI Inspection of AZ (“CSI”), provided an inspection and analysis report to Respondent. The report provides, in pertinent parts, as follows:
A 1⁄4 inch expansion gap is required in this floating floor to allow movement for thermal expansion or movement for walls, substrate and floorcovering materials.
With the air vents throughout the floor being screwed through the Mohawk Solid Tech Plus Ridged LVT (“LVT”) and into the substrate locks in the LVT which will not allow the floor to float. When thermal expansion occurs, the LVT being locked down to the substrate causes the floor to hydraulic through planks creating a convex bow due to pressure.
In the craft room/office, on the East side of the home, the substrate is out of the 1⁄4 inch tolerance stated on the installation guidelines on the box of material. Being a manufactured home, it is unable to determine if the tolerances was an oversight or due to natural causes of manufactured home settling.
This is also occurring at the kitchen and dining room area at the island. With the substrate slightly out of tolerance, this causes deflection in the LVT and allows the vinyl plank to disengage which is apparent in several end joints.
With the floor vents being anchored or screwed through the LVT floor and into the wood deck or substrate, this is no longer a floating floor. When thermal expansion occurs, in walls, roofs, and substrate, as well as, flooring materials can cause a floor the bow due to pressure of being locked in.
Installation guidelines state a 1⁄4 inch expansion gap must be maintained around or in front of any vertical obstruction to allow floor to perform properly.
These concerns are site and installation related concerns and not a manufacturer related issue.
(Emphasis added.)
Respondent resubmitted its warranty claim to Mohawk and included the CSI report. As of the date of the hearing Respondent has not received a response from the manufacturing company.
Respondent did not attempt to comply with the Registrar’s directive because Ms. Nation did not want to purchase more “bad” flooring from Mohawk to make repairs. Additionally, she did not know of another way to address the corrective work order.
On an unknown date, Respondent added the Registrar’s contact information to its contract template, including a prominent notice that a property owner has a right to file a timely complaint with the Registrar for alleged stator violation(s) in accordance with Ariz. Rev. Stat. § 32-1158(A)(9).
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(a) requires that “[a]ll work shall be performed in a professional and workmanlike manner.”
Ariz. Rev. Stat. § 32-1154(A)(12) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “Failure in any material respect to comply with this chapter.”
Ariz. Rev. Stat. § 32-1158(A) provides that a contract between a contractor and property owner amounting to more than $1,000.00 must contain the following information in writing:
The name of the contractor and the contractor's business address and license number.
The name and mailing address of the owner and the jobsite address or legal description.
The date the parties entered into the contract.
The estimated date of completion of all work to be performed under the contract.
A description of the work to be performed under the contract.
The total dollar amount to be paid to the contractor by the owner for all work to be performed under the contract, including all applicable taxes.
The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner.
The dollar amount of any progress payment and the stage of construction at which the contractor will be entitled to collect progress payments during the course of construction under the contract.
That the property owner has the right to file a written complaint with the Registrar for an alleged violation of Ariz. Rev. Stat § 32-1154(A). The contract shall contain the Registrar's telephone number, website address, and shall state that complaints must be made within the applicable time period as set forth in Ariz. Rev. Stat § 32-1155(A). The information must be prominently displayed in the contract in at least ten point bold type, and the contract shall be signed by the property owner and the contractor.
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 undisputed that the parties had a $13,698.38 flooring installation agreement, and that the contract was paid in full. It is also undisputed that Respondent completed the installation, and that as a result the flooring was “cupping and gapping.” The record further establishes that the underlying flooring installation failed to meet the Registrar’s minimum workmanship standards.
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 remediate Complainant’s project. This is an affirmative defense that Respondent bears the burden to establish. Here, Respondent has sustained her burden. Respondent was incorrect that the materials used were defective, as supported by Mohawk’s refusal to replace Complainant’s flooring under its warranty. While it is not clear whether Complainant independently chose Mohawk’s LVP flooring for her manufactured home, or whether she reasonably relied on Respondent’s suggestion(s)/assurance(s) when choosing the product for her project, the record reflects that Complainant installed the vents and the trim. In doing so, Complainant directly prevented the floor from floating and caused bowing due to pressure she created. But for Complainant screwing the vents through the LVP and into the substrate, the floor would have floated and there would not have been gaps. Thus, the substrate being 1⁄4 inch out of tolerance is a non-issue. As the CSI inspector noted, the concerns are “site and installation related” not “a manufacturer related issue.”
Therefore, because Complainant has failed to establish Respondent’s alleged violation(s) of Ariz. Rev. Stat. §§ 32-1154(A)(3) and 32-1154(A)(22), no cause exists for the Registrar to discipline ROC License No. 300147.
However, because there is no evidence to support a finding that Respondent provided corrected contract templates to the Registrar, a violation of Ariz. Rev. Stat. §§ 32-1154(A)(12); 32-1158(A) has been established by a preponderance of the evidence. Because this infraction is de minimis, discipline is not recommended.
RECOMMENDED ORDER
Based on the foregoing,
IT IS RECOMMENDED that Complainant’s appeal be denied by the Registrar.
IT IS FURTHER RECOMMENDED that Complaint No. 2022-10054 be closed and dismissed by the Registrar.
NOTICE
Pursuant to Ariz. Rev. Stat. § 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 40 days from the date of that certification.
Done this day, April 17, 2023.
Office of Administrative Hearings
/s/ Jenna Clark
Administrative Law Judge
Transmitted electronically to:
Martín Quezada, Director
c/o Legal Department
Registrar of Contractors
1700 W. Washington St., Ste. 105
Phoenix, AZ 85007
[email redacted]
Mary Engebretsen, Complainant
6685 E Thuma RD
Sierra Vista, AZ 85650
[email redacted]
Nation's Floor Covering LLC, Respondent
3837 S Highway 92
Sierra Vista, AZ 85650-5714
[email redacted]
By: OAH Staff