ALJDEC

99F-F0169-ROC · Registrar of Contractors · 2000-05-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 24, 2000. APPEARANCES: The Complainant appeared personally. The Respondent was represented by its attorney, Stephen R. Owens, Esq. 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. Respondent is the holder of License No. 126430, a Class B-01 license, issued by the Registrar of Contractors. 2. On or about July 23, 1997, Complainant and Respondent entered into a written agreement for the construction of a motel in Sedona, Arizona. 3. The written contract provided that Complainant would pay Respondent the sum of $800,000.00 to construct the motel. The contract excluded the following items from the contract price: sewer assessment fees; furnishings; permit; appliances; any items required by the county that are not on the plans; and any change orders. The Complainant, rather than the Respondent, is responsible for any such expenses. The parties further agreed to split the cost of the construction insurance. 4. On August 22, 1997, Kathy Gardner of Permit Pushers filed a building permit application for the project with the Yavapai County Planning and Building Department. 5. On December 10, 1997, the Yavapai County Planning and Building Department approved the building permit for the project. The delay in issuing the building permit was due to the necessity to revise the building plans as required by the local building department. 6. Pursuant to the terms of the parties’ agreement, Complainant was responsible for the added costs incurred in order to comply with the local building department’s requirements for approving the revised plans. 7. The final approved plans were for a 40 unit motel and two-story office area, the latter being a shell only. 8. Respondent proceeded to construct the motel and office area shell. 9. On or about August 19, 1998, The Yavapai County Building Safety Department issued a Certificate of Occupancy for the motel and office area shell certifying that the structures were in compliance with the various ordinances of the County regulating building construction or use. 10. During construction Complainant viewed the various stages of construction. Complainant did not complain about any construction issues until September 8, 1998, when Respondent requested payment from Complainant for reimbursement of funds prepaid by Respondent which were the responsibility of Complainant to incur. 11. On or about November 12, 1998, Complainant filed a complaint with the Registrar of Contractors alleging that Respondent had violated provisions of the State’s contracting laws. 12. In response to the filed complaint, the Registrar of Contractors’ assigned inspector performed a jobsite inspection to view the areas of alleged construction deficiencies. That inspection resulted in the issuance of a Corrective Work Order dated February 26, 1999, the terms of which are incorporated by reference, which not only outlined areas that required remedial work to be performed by Respondent to minimum workmanship standards but which also absolved Respondent of responsibility for numerous enumerated areas found not to be violations. 13. From the filing of his complaint in November, 1998, until he gave Respondent actual notice granting jobsite access in September of 1999, Complainant denied Respondent access to the jobsite necessary for it to comply with the Registrar’s directive. 14. It is determined that Complainant unreasonably and unjustifiably denied Respondent access to the jobsite necessary for it to perform the required remedial repairs to minimum workmanship standards. 15. Respondent is found not to have deviated from plans or specifications without approval of Complainant. 16. The issuance of the Certificate of Occupancy establishes that Respondent constructed the motel and office shell in compliance with local building codes. 17. Respondent failed to construct the project to minimum workmanship standards as to those areas identified by the Registrar’s inspector in the Corrective Work Order. 18. Respondent’s failure to construct those items of deficient workmanship identified by the Registrar’s inspector is found to be a wrongful act which has substantially injured Complainant. 19. Respondent is not responsible for those items found not to be in violation of the State’s contracting laws by the Registrar’s inspector in the Corrective Work Order. 20. Any allegation made by Complainant against Respondent not specifically addressed above is determined to lack sufficient evidence of record to support a finding of a statutory violation having been committed by Respondent. 21. Respondent did not have a bond in a sufficient amount for the volume of business that it was performing at the time of this project. However, there is credible evidence that Respondent attempted to correct that deficiency by notifying the Registrar, who did not require any additional action regarding the bond limits for this project. 22. The monetary dispute between the parties should be resolved in a civil court of competent jurisdiction rather than in these administrative proceedings.

CONCLUSIONS OF LAW

1. The Registrar of Contractors has jurisdiction over the subject matter of this action. 2. The evidence of record is adequate to establish that Respondent has violated the provisions of A.R.S. § 32-1154(A) (7) and (3); namely Rules R4-9-108 and R4-9-112. 3. Due to Complainant’s unreasonable and unjustifiable denial of access to the jobsite necessary for Respondent to repair and complete the project to minimum workmanship standards, it is determined that Respondent did not violate the provisions of A.R.S. § 32-1154(A)(23). Complainant has sought an administrative remedy utilizing the Registrar of Contractors to seek redress for Respondent’s violations of the State’s contracting laws. Neither the Registrar of Contractors nor the Office of Administrative Hearings can order a trespass upon a property owner’s land to allow a contractor to remedy proven workmanship deficiencies. The property owner, such as Complainant, must cooperate with any ordered remedial action by allowing the contractor, such as the Respondent, reasonable access to the property necessary to perform the required remedial work. Without such cooperation from the land owner, the contractor may later be found to be excused from any condition placed on its contractor’s license to perform remedial repairs if the contractor has been unreasonably prevented from obtaining access to the property in order to accomplish the corrective work.

RECOMMENDED ORDER

In view of the foregoing, it is recommended commencing on the effective date of the entered Order in this matter that Respondent’s Class B-01 license be suspended until the Registrar of Contractors receives written proof that the areas of deficient workmanship described in the Registrar’s Corrective Work Order, the terms of which are incorporated herein by reference and copies of which have previously been given to the parties, have been repaired and completed to minimum workmanship standards. Respondent is entitled to reasonable access to the jobsite in order to timely accomplish the required remedial repairs. It is further recommended that if Respondent properly accomplishes the aforementioned corrective work on or before the effective date of the entered Order in this matter, then the above-provided indefinite license suspension shall not take place and the Citation and Complaint in this matter shall be closed. It is further recommended in addition to the above-provided disciplinary penalty, if any, that Respondent be admonished to maintain adequate bond limits for its volume of business or limit its volume of business to its posted bond limits. Done this day, June 5, 2000.

______________________________________ Brian Brendan Tully Administrative Law Judge

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

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

By ___________________________

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