ALJDEC

99F-1020-ROC · Registrar of Contractors · 1999-04-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 16, 1999. APPEARANCES: Complainant appeared personally. Respondent appeared through its president and qualifying party, Craig S. Porter. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ Evidence and testimony were presented and, based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT

1. Robert Chase Construction L.L.C. (“Chase Construction”) doing business as D C Construction, was issued license number 104447, a Class B license, by the Registrar of Contractors on October 4, 1994. 2. Chase Construction’s Class B license was revoked by the Registrar of Contractors on May 2, 1996. 3. On or about July 15, 1996, the Complainant and her now-husband entered into a written agreement for the purchase of a lot and a spec home in the Los Abrigados subdivision. The agreement originally named Respondent as the seller, but was later amended to reflect the seller as Robert Chase Homes L.L.C. 4. It cannot be determined from the record whether Robert Chase Homes L.L.C. is the same entity as Chase Construction. The official records of the Registrar of Contractors do not indicate that Robert Chase Homes L.L.C. has ever held a contractor’s license. 5. Complainant’s home was substantially completed by an entity other than Respondent 6. Respondent installed the flooring in Complainant’s home and performed five items of warranty work prior to the close of escrow. 7. During the negotiations for the purchase of the house and lot, agents and/or employees of Respondent assured Complainant and her husband that they were purchasing the house with a full warranty honored by Respondent. 8. Neither representatives nor employees of Respondent or Robert Chase Homes L.L.C. ever advised Complainant that the warranty account had finite funds. 9. Because of Complainant’s concern with the reputation and condition of Robert Chase Homes L.L.C., she and her husband relied upon the solid reputation of Respondent when they decided to purchase their house. 10. Respondent and Robert Chase Homes L.L.C. had an agreement which provided that Respondent obtained an option to build homes on twenty or so lots owned by Robert Chase Homes L.L.C. in the Los Abrigados subdivision. Respondent agreed to complete construction on fourteen existing homes, including Complainant’s house, which were all in various stages of construction. Respondent was to act as construction supervisor for Robert Chase Homes L.L.C. Respondent was to supervise subcontractors and perform warranty work for Robert Chase Homes L.L.C. 11. Robert Chase Homes L.L.C. funded an account for warranty work performed or directed by Respondent. 12. Respondent performed or directed the performance of remedial warranty work to Complainant’s roof. 13. The warranty fund subsequently was depleted. It presently is unfunded. 14. It is uncontroverted that the following deficiencies need to be corrected at Complainant’s home: stucco parapet has numerous cracks, chipped and falling stucco throughout which has caused leaks resulting in interior drywall damage at windows, ceiling of house and garage; baseboard in office is loose; numerous exterior stucco cracking beyond industry; and the gate entry wall has settled, causing considerable failure to stucco. 15. Respondent has refused to perform the warranty work for the areas described in Finding No. 13 above citing a lack of available funds in the warranty account funded by Robert Chase Homes L.L.C. and a lack of responsibility to perform such work at its sole cost and expense because it served only as the project’s construction manager. Respondent asserts that it is only responsible for the work it actually performed on Complainant’s home. 16. As a result of Complainant’s filed complaint against Respondent, the Registrar of Contractor’s assigned inspector performed a jobsite inspection at Complainant’s residence. That inspection resulted in the issuance of a Corrective Work Order dated October 28, 1998, which directed the Respondent to perform appropriate remedial repairs to the areas of deficient workmanship described in Finding of Fact No. 13. 17. Respondent has not complied with the Registrar’s written directive. 18. Under all the circumstances, Respondent, as the licensed general contractor at the time Complainant and her husband purchased their home, is determined to be the party responsible for performing the above- described remedial repairs. The issue of the funding of the warranty work is deemed a matter between Respondent and Robert Chase Homes L.L.C. 19. Respondent’s failure to perform the requested warranty work and its failure to comply with the Registrar’s written directive are deemed wrongful acts which have substantially injured Complainant.

CONCLUSION OF LAW

1. The evidence of record is adequate to establish that Respondent has violated the provisions of A.R.S. 32-1154 (A) (7) (23) and (3); namely Rule R4-9-108.

RECOMMENDED ORDER

In view of the foregoing, it is recommended commencing on the effective date of the Order entered in this matter that Respondent’s Class B license be suspended until the Registrar of Contractors receives written proof that the items set forth in the complaint and in the written directive from the Registrar’s inspector, the terms of which are incorporated herein by reference, have been appropriately rectified by Respondent. It is further recommended that if Respondent properly accomplishes the aforementioned corrective work on or before the effective date of the Order entered in this matter, then the above-provided license suspension shall not take place and this citation and complaint shall be closed. It is further recommended, in addition to the above-provided penalties, if any, that Respondent pay the sum of $100.00 to the Registrar of Contractors by way of a civil penalty pursuant to A.R.S. § 32-1154(D). The failure by Respondent to pay the entire amount of the aforesaid civil penalty on or before 30 days following the effective date of the Order entered in this matter shall result in the automatic revocation of Respondent’s contractors 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), unless payment of any outstanding prior civil penalty is tendered.

Done this day, April 5, 1999.

______________________________________ BRIAN BRENDAN TULLY Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 1999, to:

Registrar of Contractors Michael P. Goldwater, Director 800 West Washington, 6th Floor Phoenix, AZ 85007

ATTN: Joyce Armijo

By ___________________________

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826