ALJDEC

99F-2272-ROC-COM · Registrar of Contractors · 2000-02-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: February 28, 1999 APPEARANCES: Jack Klausner, Esq. For Complainants; Eric Mark, Esq. For Respondent ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________ FINDINGS OF FACT 1. At the commencement of the hearing, the Administrative Law Judge informed the parties that the scope of the hearing is limited to whether Respondent has substantially complied with the terms of the settlement agreement addressed in the Recommended Decision of Administrative Law Judge Casey Newcomb dated October 1, 1999, that was adopted by the Director of the Registrar of Contractors in the Order issued on October 8, 1999. 2. It is uncontroverted that, since issuance of the above-mentioned Order, Respondent has not performed any work with respect to Complainants’ driveway. 3. During the hearing, Respondent asserted the doctrine of impossibility of performance as a reason why it did not comply with the corrective work terms of the settlement agreement.

4. The essential terms of the settlement agreement required the Complainants to provide Respondent with specifications for a 28 foot motor home, a boat and trailer, and a Dodge Caravan. Respondent was obligated under the settlement agreement to propose a solution to correct Complainants’ problem on or before November 30, 1999. 5. Cindy Berger (“Mrs. Berger”) testified that, at the time of the September 30, 1999, hearing when the parties entered into a settlement agreement, Complainants did not own a 28 foot motor home nor did they own a boat and trailer. 6. The evidence of record established that in early October, 1999, Complainants arranged a date for Charles Caldwell (“Mr. Caldwell”), Respondent’s project manager, to visit Complainants’ home for inspection of the vehicles. Complainants had arranged with their neighbor, Mr. King, to make available a boat and trailer. The parties are in agreement that Mr. King provided Mr. Caldwell with a speed boat and trailer for measurement. The parties are also in agreement that the Dodge Caravan was at Complainants’ home and was measured as well. 7. Prior to the September 30, 1999, hearing, Mr. Caldwell measured a Tioga foot motor home and drew graphs depicting the motor home entering and leaving Complainants’ driveway in terms of the distance between the skid plate of the motor home and the driveway. 8. The settlement agreement that was presented to Administrative Law Judge Casey Newcomb did not specify a certain motor home but was general in description. Mrs. Berger testified as to her belief that in accordance with the terms of the above-mentioned settlement agreement, Respondent would address repairing the driveway in such a manner so that it could accommodate any 28 foot motor home. Mrs. Berger also testified as to her belief that Respondent would address repairing the driveway to accommodate any boat and trailer. 9. Mr. Caldwell testified as to his belief that all references and discussions to a 28 foot motor home on the date of settlement were with respect to the Tioga motor home. During the hearing, Mr. Caldwell acknowledged that, at the time of settlement, he knew there was a difference in terms of clearance between different brands of motor homes that were 28 feet in length and that the settlement agreement should been more specific in that regard to clarify the parties’ intentions. 10. Subsequent to the above-mentioned settlement, Complainants provided information to Mr. Caldwell as to the location of a 28 foot motor home they were interested in purchasing. Although the record is unclear as to the make or model of that motor home, the parties agree that it was not a Tioga motor home and that it had a clearance less than that of the 28 foot Tioga motor home. 11. Mr. Caldwell measured the motor home mentioned in the preceding paragraph and determined that he could not perform the proposed method of repair so as to independently accommodate each of the three vehicles. 12. Respondent asserts that even though the settlement agreement provides for Respondent to propose a solution and does not specify what it will be, the solution Respondent intended to propose involved tilting a concrete cap and changing the slope of the driveway (collectively referred to below as “tilting the concrete cap”). According to Respondent, with the new motor home selected by Complainants, the proposed method of repair cannot be performed. Complainants maintain that there are other solutions available to Respondent to correct their driveway other than tilting the concrete cap and they submitted evidence showing that the driveway could be built at another location. According to Complainants, the reason why Respondent does not want to consider other repair methods is because of the cost involved with the other alternative methods of correction available. 14. The evidence of record establishes that there are solutions available to remedy Complainants’ driveway problems but that Respondent did not consider any alternatives except the tilting of the concrete cap. The evidence of record also establishes that all discussions prior to the settlement on September 30, 1999, concerned the one method of repair, the tilting of the concrete cap. The settlement agreement does not compel or restrict Respondent in its consideration of a solution to the driveway problem. 15. It is determined from the facts and circumstances surrounding the settlement agreement that the parties intended for Respondent to propose a solution involving the tilting of the concrete cap. 16. It is determined that it was impossible for Respondent to propose the previously discussed solution involving the tilting of the concrete cap that would independently accommodate each of the three vehicles. Although the evidence of record does not establish the time frame when Respondent came to this conclusion, the record shows that Respondent failed to notify Complainants on or before November 30, 1999, that it could not propose a solution addressing the discussed driveway problem. 17. The settlement agreement required Respondent to propose a solution to Complainants on or before November 30, 1999, which necessarily infers an obligation upon Respondent to notify Complainants by that date that there was no solution that could be proposed with respect to the tilting of the concrete cap. Therefore, it is determined that, under the terms of the settlement agreement, while Respondent had no obligation to consider solutions other than that involving the tilting of the concrete cap, Respondent had a duty to inform Complainants that it could not propose a solution involving that method of repair that would accommodate any of the above-mentioned three vehicles. Respondent breached that duty by not notifying Complainants by November 30, 1999, that it could not perform in accordance with the settlement agreement. 18. The facts and circumstances surrounding the settlement agreement, including but not limited to the vagueness and lack of specificity with respect to the 28 foot motor home, boat and trailer causes this Administrative Law Judge to determine that there was an ambiguity with respect to those items. The impossibility of performance by Respondent, as determined above, does not excuse its failure to notify Complainants on or before November 30, 1999, that it could not provide the above-discussed solution to resolve Complainants’ driveway problem.

CONCLUSIONS OF LAW It is determined that Respondent violated the spirit and intent of the settlement agreement by failing to notify Complainants by November 30, 1999, that it could not propose a solution. Consequently, Respondent is subject to possible sanctions by the Registrar of Contractors. At a minimum, Respondent’s inaction may be considered as a separate wrongful act or as a matter in aggravation in the event that a violation of the State’s contracting laws is sufficiently proven at a hearing on the merits of the underlying complaint in this matter. RECOMMENDED ORDER Based on the above, it is recommended that the Director of the Registrar of Contractors cause this matter to be re-scheduled to be heard on the merits in the nature of a rehearing, at which time, separate consideration should be given to Respondent’s failure to notify Complainants on or before November 30, 1999, that it could not propose a solution as required by the settlement agreement. Done this day, March 8, 2000 ______________________________________ Lewis D. Kowal Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2000, to:

Registrar of Contractors Michael P. Goldwater 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