ALJDEC

99F-H0165-ROC · Registrar of Contractors · 1999-09-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 15, 1999 at 1:30 p.m. APPEARANCES: Complainant Ronald Kiefer appeared on his own behalf; Respondent Linn Construction, Inc. appeared through its duly authorized employee, Jerry Hawkins. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

The parties presented evidence and testimony on the issue of Respondent’s alleged failure to perform warranty work on the exterior stucco of Complainant’s residence and, by the end of the hearing, agreed to settle this complaint. Based upon the entire record, the undersigned makes the following Findings of Fact, Conclusions of Law and Recommended Order. FINDINGS OF FACT The Registrar of Contractors issued License No. 111578, Class B, to Respondent, a corporation. Respondent was the general contractor from whom Complainant purchased his residence in July 1997. Shortly after Complainant and his wife moved into the residence, they noticed that the exterior stucco had started to crumble and fall off the structure. Complainant complained to Respondent about the problem. Respondent contacted the stucco subcontractor, Jay Allen Bauer dba Hidden Canyon Construction, License No. 110271, Class B, but Mr. Bauer did not remedy the problem at Complainant’s residence. Respondent filed a complaint to the Registrar against Mr. Bauer for his failure to remedy the workmanship and/or material deficiencies apparent in the stucco on Complainant’s residence, which was designated Case No. H99-0010. A hearing was held in Case No. H99-0010, as well as two other complaints that Respondent had made against Mr. Bauer’s license that had been consolidated, on July 12, 1999 before Administrative Law Judge M. Douglas. Judge Douglas subsequently rendered a recommended Decision and Order, which the Registrar accepted on August 13, 1999, that found the following specific deficiencies in the stucco at Complainant’s residence: Credible evidence, presented at hearing, established that the following items on the residence located at 2615 Triangle S (H99- 0010) constitute unacceptable workmanship and require proper corrective action by the Respondent:

f) There is still unacceptable stucco cracking by the front entry- way. The Respondent shall properly correct the stucco cracks by the front entry-way.

g) The stucco repairs on the garage walk-through door area require proper touch-up. The Respondent shall properly touch-up the stucco repairs in the garage walk-through door area.

h) The exterior color coating on the front of the residence was shown to be flaking and falling off the residence. The Respondent shall properly correct the exterior color coating on the front of the residence.

Finding of Fact No. 6 at page 2 of Decision and Order in Case No. H99-0010. Respondent agreed to take responsibility for repairing the items described in the Registrar’s Decision in Case No. H99-0010 and testified that it had already made an agreement with Mr. Bauer to provide the material for the corrective work. Complainant testified that the problems with the stucco were not limited to the areas described in the Decision and Order in Case No. H99-0010, which he had never seen before, but that the back of the house and other areas also showed signs of flaking and deterioration. The Registrar’s Inspector William Redman testified that he had performed a prehearing jobsite inspection and, in his opinion, the back of the house showed some of the worst deterioration. The finish coat did not appear to be adhering to the base coat anywhere on the house, which would require the house to be scraped, resurfaced with a finish coat, retextured, and color reapplied. The undersigned explained to the parties that Complainant could not be limited to the specific damages noted in the Registrar’s Decision and Order in Case No. H99-0010 because Complainant was not a party to that action. Moreover, Respondent was not prepared to dispute or controvert Complainant’s and Inspector Redman’s testimony that the flaking and deterioration was visible on other areas of the house in addition to those noted on the Registrar’s Decision and Order in Case No. H99-0010. In light of the evidence, Respondent at the hearing offered to have performed, in a professional and workmanlike manner, corrective work on the stucco on Complainant’s house wherever such work was needed within two weeks of the date of the hearing. Complainant accepted Respondent’s offer of settlement and agreed to withdraw his complaint and to consent to the entry of an order closing the complaint. However, the closure of the complaint at issue is without prejudice to the filing of a new complaint if Respondent breaches the terms of the parties’ settlement agreement. These administrative disciplinary proceedings are cut short by the parties’ entry into the settlement agreement, which is presented to the Registrar of Contractors for his approval and adoption. Consequently, Respondent is advised that any future breach of the terms of the settlement agreement will not only constitute grounds for a new complaint but also will warrant treatment as a circumstance in aggravation. All rights and defenses of the parties are deemed to have been merged into the settlement agreement and, if any timely petition for rehearing or new complaint is filed in the future, the sole issue for determination shall be whether Respondent has performed its obligations under the terms of the settlement agreement. CONCLUSIONS OF LAW 1. Public policy favors settlement of disputes and adverse parties should be free to adjust their differences by entry into agreements or stipulations. 2. The settlement reached and submitted following the hearing of this matter, having been found to be reasonable and voluntarily made, warrants termination of the hearing and closure of the Citation and Complaint. RECOMMENDED ORDER In view of the foregoing, it is recommended that the Registrar close the Citation and Complaint in Case No. H99-0165. Done this day, September 20, 1999.

______________________________________ Diane Mihalsky Administrative Law Judge

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

Registrar of Contractors Mr. Michael P. Goldwater 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