ALJDEC - Licensing

2024A-06448-CHC-ROC · Registrar of Contractors · 2025-01-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

David Hendrix ,

COMPLAINANT,

The Villalpando Corporation, Inc.

dba Villalpando Custom Homes Builders,

License No. ROC 195458,

RESPONDENT.

No. 2024A-06448-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: November 7, 2024

APPEARANCES: Davis and Rachel Hendrix represented themselves. Cruz Villalpando represented Villalpando Corporation, Inc dba Villalpando Custom Homes Builders.

ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn

EXHIBITS ADMITTED INTO EVIDENCE: Registrar Notice of Hearing Packet.

_____________________________________________________________________

FINDINGS OF FACT

Villalpando Corporation, Inc dba Villalpando Custom Homes Builders is the holder of B General Residential Contractor License No. 195458 issued by the Arizona Registrar of Contractors (Registrar or ROC) on May 4, 2004.

Complainants were building a new home. Excavation for the basement had been performed and the parties entered into an agreement on or about April 26, 2024 for Respondent to construct the basement footings and drainage systems and then install the ICF wall system. Respondent’s work began on or about May 1, 2024 and was stopped on or about May 16, 2024.

Complainants filed a complaint (Complaint) with the ROC on or about June 6, 2024 regarding concerns with Respondent’s work at the site.

The Registrar’s Investigator Miles Crosby scheduled a jobsite inspection, which he conducted on June 20, 2024. At the inspection, Investigator Crosby photographed the site and construction to date, documenting in particular the alleged Form-A-Drain issues and the construction work thereon not being in compliance with standards or manufacturer specifications.

After the jobsite inspection, Investigator Crosby issued a written directive (Directive) on June 24, 2024 to Respondent regarding the requirement to take appropriate corrective action on multiple items. The Directive provided the following statements:

After investigation, the Registrar has verified 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 Saturday, July 13, 2024.

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 reasons, 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:

Complaint Item: 1 - Concrete Slurry under the footers was not placed in the proper locations

Investigator’s Observation: I observed the Form-A-Drian system (FAD) to not be installed per the manufactures recommendations and does not meet standards. Should be corrected by appropriate mean and comply with the FAD installation requirements.

Governing Rule: 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. A.R.S. § 32-1154(A)(2)(a)

Complaint Item: 2 - Forma drain forms were not leveled or properly installed per forma drain specifications

construction project or operation completed in accordance with such plans and specifications and code. A.R.S. § 32-1154(A)(2)(a)

Complaint Item: 3 - Forma drain forms were not supported per forma drain specifications

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item: 4 - Contractor has not returned in 3 weeks since he came and we showed him everything that was wrong

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: Not Applicable

Complaint Item: 5 - Contractor keeps saying he will be here tomorrow and then he says he can't make it

Investigator’s Observation: This is a general statement and does not implicate a specific workmanship issue. It therefore and cannot be evaluated by the ROC.

Governing Rule: Not Applicable

On July 12, 2024, Investigator Crosby issued a Complaint Close letter due to the fact that the work was in progress and the parties’ agreement was really a service-for compensation agreement without a completion date; the closure letter permitted Complainant to ask to re-open the case.

On August 16, 2024, Complainant requested that Investigator Crosby re-open the matter and Investigator Crosby set a compliance inspection date.

At the August 20, 2024, compliance inspection, Investigator Crosby found that Complaint Items 1, 2 and 3 remained in need of correction. Regarding the work, Investigator Crosby noted as follows:

Compliance Jobsite General Notes:

CJSI photos taken with my Google Pixel 3a work phone

CJSI audio recorded with my Olympus DM-720

CJSI photos and audio have been placed into the Salesforce Case folder.

Respondent’s license is currently suspended.

The Respondent was not present for the Inspection and made no effort to notify me or the Complainant he would not be attending. I waited till 11:05 and called the Respondent with no answer. The Respondent called back to advise he would not be attending. It should be noted

the Respondent lives in the Phoenix area and the project is located in the Show Low area, which is approximately 4 hour driving time.

The Respondent had been advising me that he was delayed by the Form-A-Drain supplier due to ordering difficulties and shipment miscommunication. The Complainant provided documentation from the Form-A-Drain supplier, which has been added to the case file, that

the shipment and payment was delayed by the Respondent. The Respondent waited nearly 2 weeks to confirm the order shipping information and nearly another week after that to make

the payment to ship the material.

The Respondent advised me multiple times that the supplier was the reason for the delays but provided no documentation to support this. The

Respondents action show deliberate delay behavior common in the industry in order to make it seem as though the responsibility was not his. This delay has resulted in a cave in or collapse of the basement dirt wall due to the excessive rain received in the area. This could

have been prevented and should have been addressed immediately. More importantly this is a huge safety issue and the area should have been supported by shoring or used a step or slope method for the safety of workers.

Additionally, at the time of the CJSI the Respondent advised he would not be doing any work until he received the materials, FAD system, from the supplier. There is much to be done prior to the shipment being received. There is no reason not to have workers preparing the

area.

Compliance Findings:

The Respondent did not treat the situation with an urgent priority nor comply with the Written Directive. This resulted in the collapse of the basement dirt wall. Although the Respondent did not excavate the basement, it is the Respondent responsibility to ensure the substrate that is being worked upon meets or complies with building codes outlined in IRC and OSHA standards. The basement excavation should have utilized one of the following methods to ensure worker safety and property protection in case of collapse: 1) Sloping 2)

Stepping or 3) Shoring. Since none of these methods were used, the abundance of rain received led to the basement wall collapsing and is now threatening the adjacent property and the shared block wall. The Respondent does not feel this is his responsibility and has

made no effort to cure or correct the matter. This is absolutely to Respondents responsibility and should be at the highest priority to ensure the collapse does not further damage the property. The biggest issue is the inherent liability to the property on the other side of the

wall which has large trucks driving on the road. The trucks weight and vibration could be an eminent threat to safety and the Complainant were advised to contact the adjacent property owners and Respondent to find an immediate solution.

Compliance Item: 1 - Concrete Slurry under the footers was not placed in the proper locations

Compliance Item: 2 - Forma drain forms were not leveled or properly installed per forma drain specifications

Compliance Item: 3 - Forma drain forms were not supported per forma drain specifications

On August 30, 2024, the Registrar issued a Citation against Respondent, charging the following possible violations: Ariz. Rev. Stat. § 32-1154(A)(3), namely Ariz. Admin. Code R4-9-108(A) and (B); Ariz. Rev. Stat. § 32-1154(A)(11); Ariz. Rev. Stat. § 32-1154(A)(12), namely Ariz. Rev. Stat. § 32-1158; and Ariz. Rev. Stat. § 32-1154(A)(22).

On September 13, 2024, Respondent filed its Answer to the Citation. Respondent indicated that it had been working with Complainant to comply with the Complaint items. Respondent noted the work was being done in compliance with building codes and manufacturer’s standards.

The matter was not completely resolved by the parties prior to the administrative hearing.

At hearing, Investigator Crosby testified with regard to his jobsite findings, compliance findings, and directive findings. Investigator Crosby was able to see, and document, that the work in progress had not been in compliance with manufacturer’s specifications and recommendation, such as the rebar that was needed and epoxy utilized as well as the viscosity required and actual process of the slurry pour. Investigator Crosby noted that the drains were not properly located and the plumbing pipes were not properly protected. Further, that in the time between inspections, there had been a catastrophic failure of the soil under a wall adjacent to Complainant’s property. Investigator Crosby documented the determined safety hazard issue. Investigator Crosby noted that the parties had worked together on getting more work completed after the Citation had issued.

At hearing, Respondent questioned why he would assume any responsibility for the soil collapse given that he had not done the excavation work.

Investigator Crosby noted that, as a contractor, a contractor accepts the substrate upon which it performs work and must assure the safety of its work and workers per OSHA. Investigator Crosby further noted that a written contract should have provisions to add costs to assure such or have provisions to terminate in the event the prior contractor had left the substrate unsafe or unusable.

At hearing, Complainant gave testimony about the timing and his concerns that Respondent had continually delayed the project and had been unavailable, causing Complainant to have to expend some additional monies to keep the project moving along. Complainant indicated that the slurry under the footer was now corrected but that the waterproofing still needed to be done and cannot be done in the winter.

At hearing, Respondent indicated that it had hired a subcontractor to do the work and had paid that subcontractor the majority of the deposit to perform the work. Respondent noted that, after learning of the slurry issue, the slurry had all been ripped out and had been redone. Respondent argued that all the items have now been corrected and that the IBF walls are completed. Regarding the waterproofing, Respondent explained that the application specifications for the waterproofing material call for temperatures to be above 50 degrees. Regarding the OSHA issues, Respondent argued that it had not done the excavation and that they had tried to shore up the soil with plywood and stakes.

Since the time of the hearing, the parties have not informed the Tribunal that the matter was resolved informally between them.

Administrative notice is taken of Respondent’s license records on January 3, 2025. Respondent’s licensure records reflects, in 2023, the resolution of one case and, in 2024, the resolution of one case, two open cases (including the instant case) and one prior case for which Respondent’s license had been disciplined. Respondent’s license is active at this time.

CONCLUSIONS OF LAW

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

Unless otherwise provided by law, a party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code R2-19-119.

In this case, Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See Ariz. Rev. Stat. § 41-1092.07(G)(2); Ariz. Admin. Code R2-19-119(A) and Ariz. Admin. Code Section 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).

A preponderance of the evidence is:

The 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.

Black’s Law Dictionary 1373 (10th ed. 2014).

5. Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

6. “Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

7. The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).

8. Construction is not a perfect art and, normally, contractors must be allowed an opportunity to correct poor workmanship before their licenses may be suspended or revoked as a result of a failure to comply with workmanship standards.

9. Following the issuance of the Directive mandating correction of workmanship items, Investigator Crosby found that, although work was in progress again by Respondent at the time of the compliance inspection, the corrective work had not been completed and that more than a reasonable period of time had passed for the corrective work to have been completed.

10. Based on the evidence in the hearing record, the Administrative Law Judge concludes that the Investigator-determined workmanship issues existed and, thus, Respondent was in violation of Ariz. Rev. Stat. § 32-1154(A)(3), specifically Ariz. Admin. Code R4-9-108(A) for failure to perform all work in a professional and workmanlike manner and Ariz. Admin. Code R4-9-108(B) for failure to perform all work in accordance with any applicable building codes and professional industry standards.

11. The Administrative Law Judge concludes that the Investigator-determined safety issue existed and, thus, Respondent was in violation of Ariz. Rev. Stat. § 32-1154(A)(11) for failure of a contractor to comply with any safety or labor laws or codes of the federal government, state or political subdivisions of the state

12. The Administrative Law Judge concludes that the Investigator-determined contract issues existed and, thus, Respondent was in violation of Ariz. Rev. Stat. § 32-1154(A)(12), namely Ariz. Rev. Stat. § 32-1158 regarding required elements of a written contract.

13. Finally, the Administrative Law Judge concludes that the Investigator-determined workmanship issues existed and Respondent had failed to comply with the Directive by the Directive deadline. Therefore, Respondent is in violation of Ariz. Rev. Stat. § 32-1154(A)(22) for failure to take appropriate corrective action within the time period allowed in the Directive.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that the Registrar impose discipline on Respondent’s ROC License 195458 as follows:

a two business-day suspension on the effective date of the Registrar’s Order in this matter; and,

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 may 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, January 3, 2025.

/s/ Kay A. Abramsohn

Administrative Law Judge

Transmitted electronically to:

Tom Cole

Registrar of Contractors

Miles Crosby

[email redacted]

David Hendrix

4725 W White Mountain Blvd

Lakeside, AZ 85929

[email redacted]

The Villalpando Corporation, Inc.

Dba Villalpando Custom Homes Builders

38360 N Joann Way

Queen Creek, AZ 85140

[email redacted]

By: OAH Staff