ALJDEC

99F-M1485-ROC · REGISTRAR OF CONTRACTORS · 2000-01-31

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 31, 2000 APPEARANCES: Complainants : Curtis Christiansen represented the interests of the homeowners pro se; Jessica Christiansen appeared with her husband, Curtis. Respondent Hancock Communities, L.L.C. : John Tellier, Esq., with the Scottsdale law firm TITUS, BRUECKNER & BERRY, P.C.; Jeff Luke, Vice President for Construction; Darren McNamara, Senior Warranty Representative; Brian Macleod, Warranty Consultant. Respondent Wystorm Carpentry, Inc.: Scott Smith, President. Registrar of Contractors Inspector: Witness Van Bagley. ADMINISTRATIVE LAW JUDGE: Gary B. Strickland _____________________________________________________________________

Evidence and testimony having been received at the hearing and based upon the entire record, the undersigned Administrative Law Judge issues the following Findings of Fact, Conclusions of Law and Recommended Order.

FINDINGS OF FACT 1. Respondent Hancock Communities, L.L.C. is in the business of constructing new homes, doing business in the state of Arizona pursuant to a Class B license (General Residential Contracting) issued by the Registrar of Contractors. Respondent subcontractor Wystorm Carpentry, Inc. is licensed by the Registrar, holding a Class C-07 license (Specialty Residential Contracting, Carpentry).

2. Complainants entered into a written contract with Respondent Contractor on April 24, 1998 whereby the Respondent agreed to furnish material and perform services necessary to construct a new home upon property situated at 3676 E. Indigo Bay (known as lot No. 78, Orangewood Subdivision), Higley, Arizona. In consideration for the work performed and materials provided, Complainants agreed to a purchase price of $188,900. Hearing Exhibit A.

3. Respondents executed a contract with one another on August 26, 1998, stipulating that the subcontractor would perform carpentry work upon the structure and supply necessary materials in consideration for which the subcontractor would receive progressive payments. Hearing Exhibit 8.

4. Complainant filed a complaint with the Registrar of Contractors on June 11, 1999 which resulted in the Registrar’s issuance of a “Corrective Work Order” on September 1, 1999, subsequent an on-site inspection by an assigned Inspector for the Registrar of Contractors. The “Corrective Order” directed the contractor to 1) repair the joint of the fascia on the west side of the home; 2) repair a truss on the east side of the house; 3) repair a warped fascia at the joint above the gate on the east side of the house; 4) repair the fascia overhang above the garage; 5) repair the gap above the “bird block” on the overhang adjacent to the garage; 6) repair the 90 degree joint at the east side of the front porch. 5. No action was required by the Registrar on allegations that A) the fascia overhang was deficient, and B) a girder in the family room was incorrectly framed. Of the former, the Registrar concluded that the construction did not deviate from the plans. Of the latter, there was insufficient evidence in support of the charge.

6. Complainants stipulate that Respondents have satisfactorily addressed all of the alleged deficiencies with the exception that Complainants remain dissatisfied with the fascia situated over the garage as it appears to Complainants to be out-of-line. Respondent Wystorm has attempted to correct the problem. The Christensens, however, are yet disquieted concerning the condition of the fascia over the garage. Complainants further assert that the Registrar incorrectly and improperly failed to find that Respondents had deviated from the plans, thereby violating the terms of its contract with Complainants and transgressing the rules governing their respective licenses, by constructing twelve inch eaves at the roof line.

7. At the hearing, the assigned Inspector gave his opinion (a) that he does not believe that the contractor, by and through its subcontractor, materially jeopardized the structural integrity, durability or safety of the home or deviated from the on-site plans by installing a twelve inch eaves overhang; (b) that the set of plans shown to him on-site called for a twelve inch eaves overhang; (c) that Complainants’ concerns are of a cosmetic nature; and (d) that to correct the construction in an effort to bring the condition into conformity with the plans approved by and on file with the City of Gilbert it would be necessary to pull off the roof, remove the felt, extract the plywood and extend the joists. The Inspector further confirmed that the construction in place conforms with the “as-built drawings.”

8. Complainants affirmed that their concern relative the deviation from the City approved plans resulting in a twelve inch overhang as opposed to the eighteen inch overhang for which they had bargained is of an aesthetic nature.

9. The weight and sufficiency of the evidence establishes that the eaves overhang constructed on the Christensens’ home extends twelve inches, significantly different than the eighteen inch overhang for which the homeowners had bargained in their original agreement. The evidence further establishes that Complainants closed their purchase of the home on December 24, 1998 despite having voiced objection to the appearance of the “pop- outs”, a condition caused by the diminution in the size of the eaves overhang as constructed. Additionally, the evidence establishes that the condition does not disaffect the integrity, durability or safety of the roof or home. It was not established that the condition affects the quality or value of the home. Given the proof as presented, the weight of the evidence favors a finding that the construction probably followed on-site approved plans requiring a twelve inch eaves overhang.

10. The weight of the evidence further establishes that the alignment of the fascia board of which Mr. Christensen has complained has been improved so that it remains a matter of perception, a condition which Respondent has agreed to address pending this order. All other enumerated items of the complaint were found either to have been corrected, not found to constitute a prejudicial deviation from plans and specifications, not adequately shown to be workmanship deficiencies, or matters upon which Complainant failed to sustain the requisite burden of proof.

CONCLUSIONS OF LAW 1. The burden of proof generally at an administrative hearing falls to the Complainant. Culpepper v. Arizona Board of Nursing, 187 Ariz. 431, 930 P.2d 508 (App. 1997). Further, the standard of proof is that of the “preponderance of the evidence”. Smith v. Arizona Department of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985).

2. The evidence of record has failed to establish that Respondents have violated that which is set forth at A.R.S ( 32-1154 (A) (3), (7) and (23); specifically, Rule R4-9-108 (Workmanship Standards).

3. Respondent Contractor has invoked the legal doctrine of economic waste, a principle which was addressed most pointedly in Fairway Builders, Inc. v. Malouf Towers Rental Co., Inc., 124 Ariz. 242, 603 P. 2d 513 (App. 1979). According to the court establishing the precept, “[e]conomic waste is not present and the difference in value measure cannot be used unless the building would be substantially destroyed by completely remedying the defects.” Id. At 254. Further, it is the contractor’s burden to affirmatively demonstrate the proposition that economic waste would result from the repair. Id.

4. In this case, however, it is not necessary for Respondents to prove that economic waste would result, as indeed they did not, because the rationale is predicated in the immediate context upon a finding that the condition is the result of the Respondents having violated a statute or rule. Animadversion aside, Complainants have failed to prove such violation.

5. Respondents are encouraged, however, to follow up on their offer to make further correction to the fascia board at issue, as necessary.

RECOMMENDED ORDER IT IS RECOMMENDED that the Registrar issue an Order effectively closing this file upon a finding that neither of the Respondents herein are in violation, as to these Complainants, of a rule for which their licenses, either or both, should be disciplined.

Set forth this 3rd day of February in the year 2000.

______________________________________ Gary B. Strickland Administrative Law Judge

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

Registrar of Contractors 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