ALJDEC - Licensing

2023A-03612-CHC-ROC · Registrar of Contractors · 2023-10-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Fred Haider,

COMPLAINANT

v.

JC Stone LLC

License No. ROC 332078,

RESPONDENT

No. 2023A-03612-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: October 3, 2023

APPEARANCES: Complainant Fred and Karen Haider appeared via Google Meet on their own behalf. Juan Carlos De Castro appeared via Google Meet on behalf of Respondent JC Stone LLC. Investigator John Smith appeared via Google Meet on behalf of the Arizona Registrar of Contractors.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

_____________________________________________________________________

FINDINGS OF FACT

JC Stone LLC (Respondent) is the holder of License No. 332078 issued by the Arizona Registrar of Contractors (Registrar).

On or about February 8, 2022, Fred and Karen Haider (Complainant) agreed to have Respondent install marble flooring in their home. The contract amount was for $14,312.03 for the marble, and $1,789.67 for the mortar adhesive.

On or about March 27, 2023, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to project.

The Registrar assigned the complaint to Investigator John Smith. The jobsite inspection was performed on May 1, 2023.

Investigator Smith then issued a written directive on or about May 2, 2023, 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 May 23, 2023.

. . .

DIRECTIVE REQUIREMENTS

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

Complaint Item 1: “Installation of marble in two bedrooms and laundry has not been completed;

Grouting and sealing has not been completed in hall bath, hall, laundry, two bedrooms;

Removal of debris;

Removal of marble that was not uniform in size took place but the marble itself was not replaced;”

Investigator’s Observations: Verified.

The project is not complete.

Tile has not been started in two bedrooms.

Tile is not complete in the laundry room.

There are several areas of missing grout.

All installed tiles have the incorrect grout joint width.

The contract specifies 1/8 inch grout joints.

Tiles are installed with grout joints ranging from 0 to 1/16 inch.

Governing Rule: A.R.S. § 32-1154 (A)(3) - R4-9-108(a): Violation of any rule adopted by the registrar; Namely R 4-9-108(a) A contractor shall perform work in a professional and workmanlike manner.

ADDITIONAL VIOLATIONS

In addition to the allegations in the complaint, the following violations were verified:

Warning Letter: Elements of a Contract.

Investigator’s Observations: The respondent’s contract is missing the following information:

• The contractor’s business address

• The contractor’s ROC number

• An estimated date of completion

• A payment schedule

• Information about the customer’s right to file a complaint with the registrar

• Contact information for the registrar

• A signature of the property owner

• A signature of the contractor

Governing Rule: A.R.S. § 32-1154(A)(12), Namely A.R.S. § 32-1158(A) Minimum Elements of a Contract.

Any contract in an amount of more than one thousand dollars entered into between a contractor and the homeowner of a property to be improved shall contain in writing at least the following information:

1: The name of the contractor and the contractor's business address and license number.

2: The name and mailing address of the owner and the jobsite address or legal description.

3: The date the parties entered into the contract.

4: The estimated date of completion of all work to be performed under the contract.

5: A description of the work to be performed under the contract.

6: 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.

7: The dollar amount of any advance deposit paid or scheduled to be paid to the contractor by the owner.

8: 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.

9a: That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A.

9b: The contract shall contain the registrar's telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A.

9c: The information in this paragraph must be prominently displayed in the contract in at least ten point bold type...

9d: ...and the contract shall be signed by the property owner and the contractor or the contractor's designated representative.

REQUIRED CORRECTIVE ACTION: The respondent is to submit a copy of a current contract form that complies with A.R.S. § 32-1158

Warning Letter: Working beyond scope of License.

Investigator’s Observations: The scope of work for this project primarily consists of installing marble floor tile.

The respondent has one contractor’s license, a CR-60 Finish Carpentry license.

Installing tile flooring is not included in the scope of work allowed per the CR-60 license.

Governing Rule: A.R.S. § 32-1154(A)(16): Knowingly contracting beyond the scope of the license or licenses of the licensee.

(All errors contained in the original).

On June 20, 2023, the Registrar issued a Citation against Respondent, charging possible violations of A.R.S. § 32-1154(A)(2)(a), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108(a); A.R.S. § 32-1154(A)(12) - A.R.S. § 32-1158; A.R.S. § 32-1154(A)(16); and A.R.S. § 32-1154(A)(22).

On or about June 23, 2023, Respondent e-mailed an Answer to the Registrar.

On or about July 5, 2023, a Notice of Hearing was issued setting a hearing on August 15, 2023, at the Office of Administrative Hearings, an independent state agency.

After a continuance, the hearing was held on October 3, 2023.

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

Investigator Smith testified that the project was not fully completed as the laundry room was not finished and tile work had not been started in two bedrooms. Also, Investigator Smith testified that on the tiles which had been installed, there were several areas of missing grout and that all tiles had an incorrect grout joint width, as the contract specified 1/8 inch joints, yet the width ranged from 0 to 1/16 inch.

Further, Investigator Smith testified that on that same day he issued two Warning Letters to Respondent. The first was for failure to have the proper elements of a contract, as the contract did not contain Respondent’s business address or license number; no estimated date of completion; no payment schedule; no information regarding the customer’s right to file with the Registrar; no contact information for the Registrar; and there were no signatures of wither party. Investigator Smith testified that to date, Respondent had not provided an updated sample contract which complies with the statute to the Registrar.

As to the second Warning Letter, Investigator Smith testified that he issued the same, due Respondent working beyond the scope of its license, as its license was a CR-60 Finish Carpentry License which does not include installation of tile flooring. Because of this, Respondent was unable to perform the corrective work, but could have reached a financial settlement with Complainant. However, Investigator Smith testified that this too had not occurred.

Complainant offered the testimony of Karen Haider and submitted 13 exhibits into evidence.

Mrs. Haider testified that once to directive was issued, she tried to have the job completed. She testified that Mr. De Castro suggested Alpha Builder LLC to provide the remaining tile as it was the most competitive price. Mrs. Haider testified that Alpha Builder estimate was $3,653.10 for the installation and grout labor. Mrs. Haider said that the total cost to finish the project amounted to $15,286.13.

Also, Mrs. Haider testified that besides the recommendation to use Alpha Builder, Respondent made no financial contribution to resolve the matter.

Respondent offered the testimony of its Qualifying Party, Juan Carlos De Castro and Art Ehman, and submitted three exhibits into evidence.

Mr. De Castro testified that everything on the project was delayed because Complainant did not like the look of the tile and was micro-managing his work on the tile. Mr. De Castro testified further that Complainant still owed him $3,000.00. As to a possible resolution to the matter, Mr. De Castro testified that he would forgive the $3,000.00 that Complainant owed, and would pay $600.00 toward Alpha Builder’s invoice.

Finally, Mr. De Castro testified that all of Complainant’s extra expenses were because of the delays caused by Complainant and that he was not allowed to finish the job.

Administrative notice was taken of Respondent’s prior License record on May 17, 2021. Such prior License record reflected that Respondent’s License No. 332078 was first issued on January 28, 2021, and reflected that there was one open complaint, namely the present complaint, and one disciplined case.

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 Vazzano 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 departed or disregarded the plans or specifications as the grout joints were not 1/8 inch, rather they ranged from 0 to 1/16 inch. Therefore, Complainant established that Respondent did not complete the project in a workmanlike manner in violation of A.R.S. § 32-1154(A)(2)(A).

The preponderance of the evidence established that Respondent’s work was not in conformity with the Registrar’s standards. As mentioned above, the grout joints were incorrect, there were areas of missing grout, and tile was not completed in the laundry room and had not been started in the two bedrooms. 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 preponderance of the evidence established, that the invoice presented did not meet the minimum elements of a contract for this project in violation of A.R.S. § 32-1154(A)(12) - A.R.S. § 32-1158. Further, no updated sample contract had been provided to the Registrar at the time of hearing.

The preponderance of the evidence also established that Respondent contracted outside the scope of its CR-60 Finish Carpentry license as it entered a contract to install and did install the marble flooring. Thus, there was a violation of A.R.S. § 32-1154(A)(16).

Finally, the evidence established Respondent failed to complete the corrective work following the Directive being issued. While Respondent may have been hamstrung by its license to complete or hire someone to complete the work, it could have entered into a financial settlement. However, aside from the recommendation to Alpha Builder, the evidence demonstrated that Mr. De Castro made no attempt to settle with Complainant. 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. 332078 for a period of twenty 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.

It is further recommended that the Registrar require Respondent to provide a sample contract which complies with the statute within thirty days. It is further recommended that if Respondent fails to provide the same 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 the sample contract.

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, October 18, 2023.

/s/ Adam D. Stone

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

Fred Haider

[email redacted]

JC Stone LLC

[email redacted]

By: OAH Staff