ALJDEC - Licensing

2024A-07377-CHC-ROC · Registrar of Contractors · 2024-12-19

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Steven Brunasso,

COMPLAINANT,

v.

Palo Verde Outdoor Environments, Inc.

License No. ROC 288070,

RESPONDENT.

No. 2024A-07377-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: December 9, 2024

APPEARANCES: Complainant Steven Brunasso appeared on his own behalf. Lawrence Felder, Esq. represented Respondent Palo Verde Outdoor Environments, Inc. Jay Kelly and Kaylan Kelly appeared as representatives of Respondent Palo Verde Outdoor Environments, Inc. Arizona Registrar of Contractors Investigator James Carter appeared as a witness.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

EXHIBITS ADMITTED INTO EVIDENCE: Respondent Palo Verde Outdoor Environments, Inc.’s Exhibits 1 and 2; Administrative Notice taken of Agency Record

FINDINGS OF FACT

Palo Verde Outdoor Environments, Inc. (“Respondent”) is the holder of License Number 288070 issued by the Arizona Registrar of Contractors (“Registrar”).

On or about November 3, 2020, Seven Brunasso (“Complainant”) contracted with Respondent for Respondent to construct a pool and install landscaping at his home. The contract price was $247,445.22.

On or about June 28, 2024, the Registrar received a Complaint against Respondent from Complainant alleging poor work with respect to the project.

The Registrar assigned the Complaint to Investigator James Carter. After an August 6, 2024 Jobsite Inspection, at which both parties were present, Investigator Carter issued a Written Directive to Respondent dated August 13, 2024, 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 Tuesday, September 3, 2024.

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

Complaint Item: 3 - Lights in the Ramada were not Can lights as in the drawings and details

Investigator’s Observation: Contract called for can lighting to be installed. Respondent advised that he did change them out to a different light but it was per a verbal agreement with the Complainant. No evidence present of this verbal agreement. Respondent had a number of other written change orders during the course of the build but no written change order for this.

Respondent shall complete project per original contract agreement.

ITEMS NOT REQUIRING CORRECTION

The following complaint items require no action by the Respondent:

Complaint Item: 1 - Travertine does not have the 4" of sand as in the design documents for a base and soil is staining tiles along edges

Investigator’s Observation: Unable to verify, insufficient evidence to prove or disprove complaint item. Investigator observed some staining on the pavers which Complainant alleges was cause by not enough sand under the pavers per the contract. There were no areas that the investigator was able to measure the amount of sand under the pavers.

Complaint Item: 2 - Artificial turf is cooked in sunlight from windows and melting

Investigator’s Observation: Unable to verify, no evidence to prove or disprove damage was caused by the Respondent. The windows were not installed by the Respondent and the artificial grass was installed per plan and workmanship standards

Complaint Item: 4 - Ramada sink drain isn't code compliant

Investigator’s Observation: Original contract call for a drain of the sink with no specific location for the drain. Plans submit and approved to the local municipality with final inspection being completed on 05/16/2024 by the local municipality. Final Inspection Passed. No correction is required by the Respondent.

Complaint Item: 5 - Use of unlicensed subcontractors for travertine, flatwork, Painting, irrigation, and plumbing of external shower.

Investigator’s Observation: Unable to verify, no evidence to prove or disprove complaint item was present to the Investigator by the Complainant

Complaint Item: 6 - Circuit subpanel installed in Ramada doens't match plans - email to contractor 6/27 but no response. Paid partial 6/

Investigator’s Observation: The item in question is a junction box (J-Box) not a subpanel.

Per the contract and plan drawings submitted by the Complainant a J-Box was to be installed at the Ramada in this location. Item was completed as per original contract and meets minimum workmanship standards.

Complaint Item: 7 - Sheet waterfall on pool - broken plastic

Investigator’s Observation: Unable to verify, no evidence to prove or disprove damage was caused by the Respondent. During the JSI Complainant showed three cracks in the plastic under the coping for the waterfall. Respondent advised that when this was first brought to his attention there was only one crack and he has not been onsite since. No evidence was present that shows a workmanship issues caused these cracks.

Complaint Item: 8 - Irrigation lines for back Palm tree not on Tree circuit - on the plant irrigation

Investigator’s Observation: Complaint item had been completed/corrected by others prior to this JSI.

Complaint Item: 9 - Pavers are different batches in front yard and still discolored

Investigator’s Observation: At time of inspection, no deficiency observed or demonstrated. Pavers were installed at different times so exact matches may not be possible. While the paver are not exact matches in color the Registrar requires that the closest match possible be mad when the same dye lot is not available.

All errors in original.

On August 21, 2024, Respondent emailed Investigator Carter requesting that he amend the Written Directive and attached an email from Complainant that Respondent asserted constituted a change order. Investigator Carter declined to amend the Written Directive because he did not consider the email correspondence to equate to a change order.

On September 4, 2024, Investigator Carter received an email from Complainant stating that Respondent had not performed any corrective work. Investigator Carter ascertained that Respondent had been attempting to correspond with Complainant during the period of the Written Directive with an old email address, and consequently, Complainant had not received any of those communications. It should be noted that Complainant has been using the same email address since 2021, and Respondent had been previously utilizing the correct email address for years, until the issuance of the Written Directive. There was no evidence presented that Respondent tried to call Complainant during the period of the Written Directive to question why Complainant was not responsive to Respondent’s attempted communications.

Respondent agreed to have the corrective work completed by September 11, 2024. Investigator Carter extended the deadline for compliance with the Written Directive to September 12, 2024. On September 12, 2024, Investigator Carter ascertained that the corrective work was not performed. Investigator Carter scheduled a Complainant Jobsite Inspection for September 24, 2024.

However, the parties agreed to work together after the extended deadline of September 12, 2024, as Respondent apologized for missing the dates that Respondent had scheduled for the corrective work.

On September 16, 2024, while performed the corrective work, Respondent cut the trusses in the Ramada area. These trusses were part of the structural component of the building. Thereafter, Complainant would not permit Respondent to return to the jobsite.

On September 24, 2024, Investigator Carter conducted a Compliance Jobsite Inspection. Investigator Carter determined that Respondent had not complied with the Written Directive notwithstanding the extension of time within which to do so. Investigator Carter’s Compliance Jobsite General Notes state the following:

Compliance Findings: Original deadline on the Written Directive was 09/03/2024. Due to an error on the Respondents part this deadline was not met. Respondent made and agreement with Complainant to have the work completed by 09/11/2024. Again the Respondent missed this deadline. I issued the notice for the Compliance inspection on 09/12/2024 and scheduled it for 09/24/2024. Complainant allowed the Respondent to come out on 09/16/2024 in an attempt to complete the work before the Compliance inspection. However on that date Respondents caused more damage while attempting to do the work at which point Complainant denied any further access until the compliance inspection.

Complaint Item: 3 - Lights in the Ramada were not Can lights as in the drawings and details

Investigator’s Initial Observation: Contract called for can lighting to be installed. Respondent advised that he did change them out to a different light but it was per a verbal agreement with the Complainant. No evidence present of this verbal agreement. Respondent had a number of other written change orders during the course of the build but no written change order for this. Respondent shall complete project per original contract agreement.

Compliance Observation: Investigator observed that there were at least two 2x4 beams that were part of the structural truss package that Respondents electrician cut completely through causing more damage.

Thereafter, Investigator Carter forwarded the Complaint to the Registrar’s Legal Department. The Registrar issued a Citation against Respondent charging possible violations of A.R.S. § 32-1154(A)(2)(a) and A.R.S. § 32-1154(A)(22).

Respondent timely filed a written Answer to the Citation and the matter was referred to the Office of Administrative Hearing, an independent State agency, for an administrative hearing.

The matter was set for hearing on December 9, 2024. Complainant appeared on his own behalf. Lawrence Felder, Esq. represented Respondent. Jay Kelly and Kaylan Kelly appeared as representatives of Respondent. Investigator Carter appeared as a witness.

Investigator Carter testified consistently with the findings contained in his Jobsite Inspection Notes, the Written Directive, and the Compliance Jobsite Inspection Notes. Investigator Carter testified that there were engineering stickers and stamps visible on the trusses advising that they were structural components. Investigator Carter testified that there was a way to install the lighting by removing the tongue and groove, which was not a structural component of the Ramada. Had Respondent intended to cut into the trusses, an engineer would have had to sign off on the changes to the trusses. Instead of proper correction, Respondent missed multiple deadlines and caused additional damage to the structure.

Regarding Respondent’s contention that Complainant agreed to the can lights installed which differed from those specified in the contract details, Investigator Carter testified that there were multiple change orders throughout the course of the project, yet there was no change order for this particular item. The lighting was the only variation from the contract for which there was no executed change order. Furthermore, the email exchange that Respondent showed Investigator Carter alleging that it illustrated Complainant’s acquiescence, concerned billing, not an acceptance of the differing lights.

Investigator Carter testified that after the extended deadline in the Written Directive expired, which in this case was September 12, 2024, Complainant had no obligation to allow Respondent another opportunity to perform any additional work. Investigator Carter further testified that there was no denial of access during the period of the Written Directive. The fact that Respondent was utilizing an incorrect email address for Complainant during that period of time, when there had been no such issue previously, was through no fault of Complainant. Respondent did not attempt any other mode of communication, such as a phone call.

Complainant agreed with Investigator Carter’s testimony. Complainant testified that all change orders were in writing. Complainant further credibly testified that he did not agree to a change in the lights as he had wanted to be able to use an app to operate the lights and could only do so with the lights for which he contracted to be installed. Complainant testified that he changed his email address in 2021, and since that time has received approximately 75 emails from Respondent, and therefore, Respondent was aware of his email address. Complainant testified that he provided full access to Respondent during the required time period and that Respondent caused more damage.

Mr. Kelly testified that this was a large project of almost $300,000.00, and that changes were made both in the field and by change order. Mr. Kelly testified that Respondent installed the lights that were recommended by its electrician and that Complainant agreed to the change. The email string that Respondent submitted into evidence does not demonstrate that Complainant agreed to a change in the lighting.

Regarding the Written Directive, Mr. Kelly testified that after receiving it, he scheduled the repair work with an electrician, and after receiving no response from Complainant, contacted Investigator Carter who discovered Respondent had been utilizing an old email address for Complainant. Regarding the September 12, 2024, extended deadline, Mr. Kelly testified that he told Investigator Carter that he had scheduled the electrician for September 11, 2024, however, the electrician did not show up on that date. When the electrician finally did attempt to install the correct lighting, he cut the lumber and as a result, Complainant asked him to cease working.

Mr. Kelly testified that although he told Investigator Cater that the work would be completed on September 11, 2024, he did not believe that was the deadline to complete the work. Mr. Kelly testified that he believed Respondent could continue to perform work until the Compliance Jobsite Inspection date of September 24, 2024. Mr. Kelly asserted that Respondent wanted to continue to perform work, however, after September 16, 2024, Complainant would not permit Respondent to do so. Respondent had no objection to the Written Directive and remains willing to perform the required work.

Mrs. Kelly also testified that Respondent believed it had until the Compliance Jobsite Inspection date of September 24, 2024, to complete the required work. Mrs. Kelly testified that Complainant’s old email address pre-populated in her computer. However, she did not explain why this had not previously been an issue from 2021 until the issuance of the Written Directive in August 2024.

Administrative notice is taken of Respondent’s prior License record on December 17, 2024. Such prior License record reflects that Respondent’s License Number 288070 was first issued on January 7, 2014, and is active. Such prior License record also reflects that there is only the instant open Complaint, no resolved/settled complaints, and no complaints resulting in discipline 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.”

The evidence established that the parties’ contract called for can lighting to be installed, Respondent failed to install can lights, and did not have a change order allowing for such change. Further, the credible evidence of record established that such change had not been agreed to by Complainant. Therefore, Complainant established that Respondent departed from or disregarded plans or specifications in a material respect, that is prejudicial to Complainant, and without Complainant’s consent, in violation of A.R.S. § 32-1154(A)(2)(a).

The evidence established that Respondent did not complete the corrective work following the Written Directive, notwithstanding an extension in which to do so. Moreover, even after the expiration of the extension, Complainant allowed Respondent access to the jobsite, and Respondent cut the trusses, resulting in structural damage. Further, Respondent failed to establish any affirmative defense to establish valid justification for the failure to comply with the Written Directive. Respondent utilized an incorrect email address for Complainant during the period of the Written Directive. This is fully attributable to Respondent and seems disingenuous given that Respondent had previously been using a valid email for Complainant for years. Further, Respondent’s contention that it believed it had until the day of the Compliance Jobsite Inspection to perform repairs is also disingenuous. Investigator Carter credibly testified that Respondent was aware that it had until September 12, 2024, to effectuate the repairs, and that the date was based on when Respondent indicated it could schedule its electrician. 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 Number 288070 for a period of three (3) 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 (30) 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, December 19, 2024.

/s/ Sondra J. Vanella

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

c/o Legal Department

[email redacted]

Steven Brunasso

[email redacted]

Lawrence Felder, Esq.

[email redacted]

Palo Verde Outdoor Environments, Inc.

[email redacted]

James Carter

[email redacted]

By: OAH Staff