ALJDEC - Licensing

2023A-05004-CHC-ROC · Registrar of Contractors · 2024-08-13

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

George Perrault ,

COMPLAINANT

Chalk Hill Construction LLC

License No. ROC 249747,

RESPONDENT

No. 2023A-05004-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: November 11, 2023, January 24, 2024 and April 4, 2024

APPEARANCES: Francis and Daniel Slavin appeared as counsel on behalf of Complainant. Andrew Wenker appeared as counsel on behalf of Respondent.

ADMINISTRATIVE LAW JUDGE: Amy M. Haley

EXHIBITS ADMITTED INTO EVIDENCE: Complainant’s exhibits 1 – 16 were admitted. Respondent’s exhibits identified by bates labels only as CHC_000001 – CHC_000580 were admitted. Administrative Notice was taken of the Notice of Hearing packet and all of its documents contained therein.

_____________________________________________________________________

FINDINGS OF FACT

Chalk Hill Construction LLC (Respondent) is the holder of License No. 249747 issued by the Arizona Registrar of Contractors (Registrar).

On or about August 19, 2022, George Perrault (Complainant) entered into a “cost-plus” contract with Respondent for, among other things, the renovation of a guest cottage located at 95 Oak Creek Blvd, Sedona, AZ, (Property) to include interior renovation and the construction of a roof extension for the rear patio.

Per the contract, Respondent was responsible for obtaining and paying for all required building permits while Complainant was to pay for any assessments and charges required by public bodies.

On November 10, 2022, Respondent emailed Complainant with a sketch drawing of a roof extension that would cover the rear patio.

On November 11, 2022, Complainant responded to Respondent that the “pavers should be 10’ all the way across and that the roof should extend as well...” to which Respondent agreed.

The roof extension required a permit in the City of Sedona, Arizona (City).

A permit was not obtained for the roof extension prior to beginning construction.

On or about November 22, 2022, Complainant received a Notice of Violation (Notice) from the City of Sedona (City) for work that Respondent had performed on the roof extension without first obtaining a permit in violation of City Code Section 15.05.030. The Notice required Complainant to obtain an after-the-fact building permit of the construction plans within a 30-day timeframe or fines may be imposed.

On November 23, 2022, the City issued and posted a Stop Work Order at the property. This required that all work at the property cease.

On December 10, 2022, Respondent advised Complainant that he had “met with the engineer regarding the [roof extension] and he was comfortable with it as designed. Just waiting for his report before continuing with permitting.”

On December 30, 2022, Respondent advised Complainant that the engineer had everything he had asked for and that Respondent was on the engineer’s schedule. Respondent advised that once Respondent received the engineer’s work, it would submit it for permitting.

On or about December 2022, Complainant began to review the invoices that were submitted for payment from Respondent with scrutiny. It was at that time that Complainant advised Respondent to finish the approved projects, but not to start any new projects.

By January 3, 2023, Complainant had paid in full all invoices that Respondent had presented to Complainant for payment.

On or about January 5, 2023, Respondent sent an email to Complainant stating: “I think we might all be more comfortable if you conclude your project directly” after which Respondent prepared “a final invoice.”

On or about January 6, 2023, Respondent presented Complainant with a final invoice.

Complainant subsequently filed the first complaint with the Registrar, on or around January 31, 2023 which was assigned to Investigator Brandon Smith. This first complaint was centered on the lack of permitting.

On or about February 1, 2023, Complainant submitted plans to the City for approval to obtain a permit. The plans were drafted based on what Respondent had built.

On or about February 22, 2023, the Registrar issued a warning letter to Respondent for performing work without a permit.

The City required changes to the plans that were initially submitted. After the changes were made, Complainant resubmitted the plans for the City’s approval.

On March 29, 2023, Complainant obtained city stamped permit B-06251 and the first complaint was ultimately closed for compliance.

On April 11, 2023 Complainant, via email, requested that Respondent reconstruct the patio to meet the permit specifications.

On or about April 27, 2023, the City inspected the roof extension as built and found several code violations that did not comply with the approved plans.

On or about May 1, 2023, the Registrar received this Complaint against Respondent from Complainant alleging poor work and abandonment with respect to the project.

The Registrar assigned the complaint to Investigator Dave Thomas. After a jobsite inspection, Investigator Thomas issued a written directive 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 . July 10th 2023.

. . . . .

DIRECTIVE REQUIREMENTS:

You are directed to remedy the following violations by the

appropriate means:

Compliance Item: 1 - Work not performed according to permit B-06251.; South post not supported 1 inch above the pavers as discussed in 2018 IRC

R317.1.4;

Investigator’s Observation: This complaint item is verified. Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. Respondent shall correct by appropriate means.

. . . . .

Compliance Item: 2 - Plans call for 4x8 beams, 4x6 beams in place

Investigator’s Observation: This complaint is verified. Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be

corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. Respondent

shall correct by appropriate means

. . . . .

Compliance Item: 3 - 2x6 rafters are required to be "seat cut" as shown in

plans, or shimmed to provide 1.5 inch bearing as required by R502.6; rafters

have neither seat cut or are shimmed.

Investigator’s Observation: This complaint item is verified. Per city of Sedona code, rafters require seat cut or shimmed to provide 1.5 inch of bearing on beam. Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. Respondent shall correct by appropriate means.

. . . . .

Compliance Item: 4 - Plans call for a 4x4 ridge post at open end of gable, 2x4 in place;

Investigator’s Observation: This complaint item is verified .Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. Respondent shall correct by appropriate means.

. . . . .

Compliance Item: 5 - Plans call for 4x6 beam at gable end, 2x6 is in place

. . . . .

Compliance Item: 6 - Beams not connected to existing building rafters, only

connected to existing roof 1x6 sheathing

Investigator’s Observation: This complaint item is verified. Per city of Sedona, no way to confirm beam support to existing roof as it only appears to be fastened to existing roof sheathing. Right side beam looking at the house has a Simpson Strong tie angle bracket attached on one left side of beam and the right side bracket is not attached. Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards. Respondent shall correct by appropriate

means

. . . . .

Compliance Item: 7 - Plans call for H1Z post cap at gable end of beam to

post connection

. . . . .

Compliance Item: 8 - North post not constructed according to plans

. . . . .

Compliance Item: 9 - North and south beams not attached to existing

structure according to plans;

Investigator’s Observation: This complain item is addressed in item 6

. . . . .

Compliance Item: 10 - North roof not constructed according to plan;

Investigator’s Observation: This complaint item is verified. Plans were submitted by homeowner after project had stop order by city of Sedona. Respondent constructed porch without approved plans or permit. Unpermitted work shall be inspected by a local building inspector and any building code deficiencies identified or code violations caused by the respondent shall be corrected. A contractor shall perform all work in accordance with any applicable building codes and professional industry standards

Following the issuance of the written directive, Respondent took no action. After the deadline in the directive expired, Investigator Thomas was notified no corrective work had been performed.

The Registrar issued a Citation against Respondent, charging possible violations of Ariz. Rev. Stat. § 32-1154(A)(1); Ariz. Rev. Stat. § 32-1154(A)(2)(a); Ariz. Rev. Stat. § 32-1154(A)(2)(b); Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A); and Ariz. Rev. Stat. § 32-1154(A)(22).

Hearing Evidence

Investigator Smith testified that he was originally assigned to this case, but had a family emergency which required the complaint be reassigned to Investigator Thomas. He further testified that he received a request from Respondent’s counsel to reschedule the jobsite inspection, to which he replied and carbon copied Investigator Thomas.

Investigator Smith testified that there had been an earlier complaint filed by Complainant, for which he conducted a jobsite inspection on March 14, 2023 and issued a written directive on March 23, 2023. In this written directive, he did not cite Ariz. Rev. Stat. § 32-1154(A)(1) because he could not compel Respondent to finish the work when the City had “red-tagged” the project. Therefore, he testified that his intention was to focus on the permitting aspect to “get the parties going.” After the compliance deadline had expired, Investigator Smith stated he confirmed with Complainant that a permit had been obtained and subsequently closed the complaint. He further testified that his written directive was never for Respondent to reconstruct the roof extension, but only permit it.

Investigator Thomas testified consistently with his written directive and jobsite inspection notes. Investigator Thomas testified that the complaint was originally assigned to Investigator Smith; however, due to a scheduling conflict, the matter was reassigned to him. He further testified that the jobsite inspection had been scheduled by Investigator Smith for June 7, 2023. Because the jobsite inspection had not yet taken place, Investigator Thomas testified that he was unaware of any prior complaints being filed because the jobsite inspection is usually the first event to take place.

Investigator Thomas testified that Respondent failed to appear at the jobsite inspection and the inspection proceeded forward in its absence. After conducting the jobsite inspection, Investigator Thomas verified complaint Items 1 through 10 and issued a written directive to that effect, with a compliance deadline of July 10, 2023.

On July 13, 2023 Complainant advised Investigator Thomas via email that no work had been completed, which was subsequently confirmed in a phone call with Complainant on July 14, 2023. Investigator Thomas also testified that he had not heard from Respondent during the time from the jobsite inspection through the compliance deadline and thus sent a pencil cite to the legal department of the Registrar for the issuance of a citation.

Investigator Thomas testified that he had no knowledge of the “original plans” for the patio or that there had been a prior complaint issued in this case prior to the first day of the hearing on November 11, 2023.

Investigator Thomas further testified that he cited Respondent for Ariz. Rev. Stat. § 32-1154(A)(1) based on what he observed at the jobsite inspection and the fact that the work had not been completed.

Investigator Thomas further testified that if there had been a stop work notice issued by the City, this would be a legal excuse for Respondent to stop work.

Complainant testified that the subject property located at 95 Oak Creek Blvd was a rental cottage. On November 22, 2022 he received a Notice for “work without a permit.” Once he received the Notice, all work on the roof extension ceased and Respondent took the lead on obtaining the permit. From November 22, 2022 through December 2022, it was Complainant’s understanding that Respondent was working on obtaining the necessary permit.

Complainant testified that also during December 2022, he started to review the invoices submitted to him from Respondent and noticed areas of concern. As a result, he informed Respondent not to start any new projects, but to complete what had already been approved, which included obtaining the permit for the roof extension. Complainant also stated that, at that time, all outstanding invoices had been paid.

Complainant further testified that he received an email from Respondent on January 5, 2023 advising him: “I think we might all be more comfortable if you conclude your project directly” after which Respondent prepared “a final invoice.” Complainant stated he was shocked because approximately five days prior to that he had stressed to Respondent that he wanted the job finished. He stated that he never instructed Respondent not to obtain any permits. Because the Notice contained a deadline in which to obtain the permit, Complainant, with the help of the City, drew up the plans exactly as Respondent had built the roof extension and submitted the permit application. Complainant testified that approximately 5 weeks later, he received a reply from the City asking for additional information. Complainant stated he wanted to make as minimal changes as possible in order to save costs. After he made these changes to the plans, he resubmitted the plan for approval. Complainant testified that when he received the approved plans from the City back, he sent those plans to Respondent for Respondent to make the approved changes. Respondent never responded to Complainant’s request. Finally, Complainant stated that on April 27, 2023, the City completed an inspection of the roof extension and found several code violation and items that did not comply with the approved plans. Ultimately, the City would not approve the structure as Respondent had built it.

Complainant testified that he never spoke with Judith Hogue and that Ms. Hogue was not involved in the project. He testified that all of his conversations were with her husband. He affirmed that he never advised Respondent not to obtain a permit. Ultimately, when Complainant obtained the permit, it cost him $138.81 which he considered a trivial amount that he would not have objected to pay. Complainant further testified that after he received the Notice, Respondent advised that it would obtain the permit. Complainant testified that he was never billed for the engineer’s time to work on the project.

Judith Hogue, part owner of Respondent, testified on behalf of Respondent. Ms. Hogue testified that the parties entered into a “cost-plus” type of contract, allowing Complainant the ability to control every aspect of the project. Ms. Hogue stated that Respondent was instructed by Complainant not to obtain the required permits as Complainant did not want to the delay associated with obtaining the permits. Ms. Hogue testified that after receiving the Notice, Respondent “engaged an engineer” on its own behalf “in an effort to get a permit” for Complainant. Ms. Hogue testified that Respondent never returned to the project after January 5, 2023 because Complainant had outstanding invoices.

Paul Walter, licensed architect, testified on behalf of Respondent. Mr. Walter testified that he was asked to review the project after the construction had started. He was asked to look at the existing structure to find out what had to be done in order to get the permit issued. Mr. Walter was of the opinion that it was possible to obtain the approval from the City as built, with a few minor modifications and/or additions to the roof extension. He further stated that he concluded the structure did comply with building code and that it could bear the proposed load. Mr. Walter testified that the City typically accepts the calculations and determinations of the architect when the permit application is submitted. He also clarified that his calculations were done pursuant to the International Building Code (IBC), not the Residential Building Code (RBC). However, Mr. Walter testified that the IBC was more restrictive than the RBC; therefore, if it complied with the IBC, it necessarily complied with the RBC.

Administrative notice is taken of Respondent’s prior License record on August 9, 2024. Such prior License record reflects that Respondent’s License No. 249747 was first issued on October 5, 2008 and is currently active. Such prior License record also reflects that there was this open complaint and one prior resolved/settled case against Respondent’s license.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”

It is Respondent’s responsibility to obtain all permits required for its work prior to starting the work. In failing to do so, it jeopardizes its license. Failing to obtain all necessary and proper permits is evidence of failing to perform its work in a professional and workmanlike manner. Notwithstanding, lack of permitting was not contained within the written directive. The written directive required Respondent to perform all of the work necessary to bring the roof extension, as built, in compliance with the City approved plans.

The evidence established that Respondent’s work, as built, was not in conformity was not in conformity with the Registrar’s standards in that it could not pass City inspection as evidenced by the fact that the as built plans, as originally submitted for permitting, was rejected. Therefore, Complainant established that Respondent did not complete the project in a workmanlike manner in violation of Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A).

The evidence, based on this, further established that Respondent did not perform all work in accordance with the applicable building codes and professional industry standards, thereby violating Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(B) and Ariz. Rev. Stat. § 32-1154(A)(2)(b).

The evidence established that Respondent refused to perform without legal excuse for the abandonment or refusal in violation of Ariz. Rev. Stat. § 32-1154(A)(1).

The evidence established that the roof extension, to the extent that it was built, was built according to the plans or specifications discussed between the parties. That those plans or specifications were not ultimately approved by the City is a separate issue. The evidence further established that the roof extension, as built, was different from the plans approved by the City because the plans had to be altered to come into compliance with City code in order to ultimately be approved. Therefore, the evidence does not establish that Respondent departed from or disregarded the plans or specifications that the parties had originally agreed upon. As such, the evidence did not establish that Respondent violated Ariz. Rev. Stat. § 32-1154(A)(2)(a).

It is undisputed that Respondent did not perform any work after January 5, 2023. The evidence established that Respondent did not attempt to complete the corrective work following the Directive being issued. Therefore, Complainant established that Respondent failed to take appropriate corrective action following a written directive from the Registrar in violation of Ariz. Rev. Stat. § 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. 249747 for a period of 2 days.

It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to Ariz. Rev. Stat. § 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. § 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, August 13, 2024.

/s/ Amy M. Haley

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

By: OAH Staff