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BEFORE THE OFFICE OF ADMINISTRATIVE HEARINGS
STATE OF OREGON
for the
CONSTRUCTION CONTRACTORS BOARD
In the Matter of the Arbitration between:
Catherine Hoffman, File No: 80562-104
Complainant
And ARBITRATION AWARD
Basim Ibsies,
Respondent
STATEMENT OF THE CASE
On September 12, 2007, complainant, Catherine Hoffman, filed this complaint with the
Construction Contractors Board (CCB) alleging that respondent, Basim Ibsies, performed
improper work in the installation of a radiant heat system at a residence located at 27019 SW
Ladd Hill Rd., Sherwood, Oregon. Ms. Hoffman is seeking $7,805.82 in damages.
On March 13, 2008, the CCB referred this complaint to the Office of Administrative
Hearings for binding arbitration, in accordance with ORS 701.145 and 148 and OAR 812-004-
0590. Administrative Law Judge Anita C. Smith was appointed to serve as arbitrator.
On July 16, 2008, arbitration was held in Salem, Oregon. Ms. Hoffman appeared, pro
se. Mr. Ibsies appeared in person and with counsel, David P. Smith. Ms. Hoffman, Rick
Gaumitz, John Arnold and Chester Parker testified on Ms. Hoffman’s behalf. Mr. Ibsies, Georgy
Buzhduga, Tom Paddock, and Jack Nunn testified as witnesses on Mr. Ibsies’ behalf. Inna
Olson was qualified as an interpreter in Ukrainian and was appointed to serve as the interpreter.
The record consists of the testimony of the witnesses and Exhibits 1 through 108, C-1
through 11, R-1, and R-3, which were admitted without objection. Exhibit C-12 was admitted
over respondent’s objections that the exhibit was untimely and lacked foundation. The record
was closed on July 16, 2008, at the conclusion of the hearing.
I, the undersigned Arbitrator, enter the following:
FINDINGS
In late 2006 or early 2007, Mr. Arnold contacted Mr. Ibsies about installing tile at Ms.
Hoffman’s house. Mr. Arnold met Mr. Ibsies at a nearby store and drove him to Hoffman’s
house. Mr. Ibsies viewed the area where the tile was to be installed and provided Mr. Arnold
Catherine Hoffman and Basim Amin Ibsies, CCB File No. 80562-104
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with a bid. Ms. Hoffman was not ready to move forward with the project and so the bid was not
immediately accepted.
Approximately six months later, in May 2007, Mr. Arnold called Mr. Ibsies and told him
to go ahead with the project. Mr. Arnold arranged the date and time for Mr. Ibsies to begin
working and provided him with the code for Ms. Hoffman’s gate so he could enter the house.
Mr. Arnold also arranged the date and time for Mr. Gaumitz with Team Electric to begin
working. Ms. Hoffman supplied the tile and the radiant heat system. Ms. Hoffman had
purchased the radiant heat system two years before and had been storing it in her garage until she
was ready to begin the project.
Both Mr. Ibsies and Mr. Gaumitz worked on laying out the radiant heat mat. Mr.
Gaumitz tested the system and found all of the resistance readings to be within manufacturer’s
specifications, which indicated that the system was working correctly. Mr. Ibsies then installed
the tile. After Mr. Ibsies completed the floor, he reported to Mr. Arnold that the project was
substantially complete, except for removing the shine from the marble to give it the matte finish
Ms. Hoffman wanted. Ms. Hoffman then paid Mr. Ibsies $4,500.
A few days later Mr. Arnold called Mr. Ibsies and told him not to take the shine off the
floor because Ms. Hoffman decided she liked the shiny finish. Based upon Mr. Arnold’s
instructions, Mr. Ibsies sent Ms. Hoffman a check for $700, as a refund of the cost to refinish the
floor.
Approximately three weeks later Mr. Arnold contacted Mr. Ibsies because Ms. Hoffman
was dissatisfied with the temperature variation between some of the tiles. Mr. Arnold arranged
for a meeting with Mr. Ibsies and Ms. Hoffman. Mr. Ibsies contacted Mr. Paddock, who is an
expert in radiant heat floor systems with Intrepid Marble and Granite, and asked him to attend
the meeting. When Mr. Paddock arrived at Ms. Hoffman’s house, Mr. Arnold introduced
himself to Mr. Paddock as the general contractor.
Mr. Arnold participated in the meeting and took temperature readings of the floor. Mr.
Paddock also inspected the floor. He found that the tile was installed correctly and that the
radiant heat system was operating within industry standards. There were a few cooler spots in
various parts of the floor, which was to be expected, given the natural variations in the density of
the marble.
On August 8, 2007, Ms. Hoffman sent Mr. Ibsies a 10 day demand letter, demanding
payment for alleged improper work. Although the letter was copied to the CCB, it did not state
that Ms. Hoffman was going to file a complaint with the CCB if Mr. Ibsies did not accede to her
demand. When Mr. Ibises refused Ms. Hoffman’s demand, she filed a complaint with the CCB
on September 10, 2007.
On December 17, 2007, the CCB conducted an onsite inspection. The investigator found
that except for one tile that was loose and needed to be properly secured, the tile and the radiant
heat system had been installed correctly.
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As the proponent in this case, Ms. Hoffman has the burden of proof. Before reaching the
merits of the claim, Ms. Hoffman must first prove that her claim is within the jurisdiction of the
CCB.
1. Thirty Day Notice.
According to ORS 701.147, a pre-complaint notice of intent to file a complaint must be
served upon the respondent 30 days before actually filing a complaint with the CCB. The notice
may be waived if the complainant can prove that the respondent had actual knowledge of the
dispute. ORS 701.133.
In this case, Ms. Hoffman did not serve Mr. Ibsies with a 30 day notice of intent to file a
complaint. However, on August 8, 2007, she sent Mr. Ibsies a demand letter outlining her
complaints regarding the floor. The letter indicated that Ms. Hoffman sent a copy of the letter to
the CCB, which by implication, put Mr. Ibsies on notice of her intent to file a complaint with the
CCB. Based upon that letter, I find that Mr. Ibsies had actual notice of the dispute.
2. Direct Contractual Relationship.
According to OAR 812-004-0320:
(5) Complaints will be accepted only when one or more of the
following relationships exist between the complainant and the respondent:
(a) A direct contractual relationship based on a contract entered
into by the complainant and the respondent, or their agents; * * *
According to OAR 812-002-0250:
"Direct Contractual Relationship" as used in OAR 812-004-0320 has the
following meanings:
(1) For an owner, construction lien or primary contractor complaint,
"direct contractual relationship" means a relationship created by a contract
between the complainant and the respondent providing that the respondent
perform construction work in return for valuable consideration conveyed
directly from the complainant to the respondent.
According to OAR 812-002-0320:
"General contractor," as used in ORS 701.005 and for purposes of a residential
general contractor, means a contractor whose business operations require the
use of more than two unrelated building trades or crafts that the contractor
subcontracts or performs in whole or part whenever the sum of all contracts, on
any single property, including materials and labor, exceeds $2,500. “General
contractor,” as used in ORS 701.005 and for purposes of a commercial general
contractor level 1 or commercial general contractor level 2, means a contractor
Catherine Hoffman and Basim Amin Ibsies, CCB File No. 80562-104
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whose business operations require the use of more than two unrelated building
trades or crafts that the contractor subcontracts or performs.
Ms. Hoffman has the burden of proof to establish that she had a direct contractual
relationship with Mr. Ibsies. The key to this analysis is Mr. Arnold. General contractors are not
agents of the homeowner. If Mr. Arnold was acting as a general contractor, the direct
contractual relationship is between Mr. Arnold and Mr. Ibises. If Mr. Arnold was not the general
contractor, the direct contractual relationship is between Ms. Hoffman and Mr. Ibsies.
In this case, Mr. Arnold initially contacted Mr. Ibsies about installing the floor. Mr.
Ibsies provided his bid to Mr. Arnold. Mr. Arnold contacted Mr. Ibsies six months later and told
him to go ahead with the project. Mr. Arnold arranged the date and time for Mr. Ibsies to begin
working and provided him with the code for Ms. Hoffman’s gate. Mr. Arnold also arranged the
date and time for Mr. Gaumitz with Team Electric to begin working.
Mr. Arnold directed Mr. Ibsies in his work by instructing him as to the finish on the floor.
When Ms. Hoffman had complaints about the floor, Mr. Arnold contacted Mr. Ibsies. Mr.
Arnold arranged the meeting with Mr. Ibsies, Mr. Paddock, and Ms. Hoffman. Mr. Arnold
introduced himself to Mr. Paddock as the general contractor.
Ms. Hoffman referred to Mr. Arnold as the general contractor three times in her CCB
complaint. In response to questions about referring to Mr. Arnold as the general contractor, Ms.
Hoffman stated it was a mistake. Mr. Arnold provided the materials for Ms. Hoffman’s project
and invoiced her on Construction Plus letterhead in May 2007. Mr. Arnold used his
Construction Plus account with Contract Furnishings Mart to purchase the tile.
When Mr. Arnold was questioned about sending Ms. Hoffman an invoice on his company
letterhead, six and one-half years after his CCB license expired, he stated it was a mistake. Ms.
Hoffman and Mr. Arnold’s explanation that it was all a mistake is not credible.
Ms. Hoffman also argued that because she did not pay Mr. Arnold that he was not the
general contractor. The definition of a general contractor does not include a requirement that the
services be provided for remuneration. OAR 812-002-0320. Ms. Hoffman paid Mr. Ibsies
directly, giving rise to the argument that she had a direct contractual relationship with him.
However, the evidence is overwhelming that Mr. Arnold was acting as a general contractor. As
such, there was no direct contractual agreement between Ms. Hoffman and Mr. Ibsies.
Even if Ms. Hoffman had a direct contractual relationship with Mr. Ibsies, she failed to
prove that he performed negligent or improper work. The tile was installed properly and the
radiant heat system was working within the manufacturer’s specifications.
Ms. Hoffman’s premise that the thin-set is the reason for the temperature variation was
not persuasive. First, it is based upon supposition. The tiles were not removed and there was no
actual evidence of how much thin-set was used. Second, if the amount of thin-set was 1” to 1
1/2” thick as Ms. Hoffman contends, the tiles themselves would not be level because thin-set
shrinks as it dries. If that much thin-set was used, the drying time would be inconsistent
Catherine Hoffman and Basim Amin Ibsies, CCB File No. 80562-104
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throughout the floor. The finished product would have extreme “lippage” between the tiles,
instead of the very smooth finish of Ms. Hoffman’s floor.
All of the experts agree that some temperature variation is to be expected with a radiant
heat system. This is especially true when using natural stone, such as marble, because of the
variations in density of the stone within each tile. Thin-set is a factor, but only to the extent that
small, varying amounts of thin-set were required to compensate for the slight variations in the
thickness of the marble tiles.
The radiant heat system installed in Ms. Hoffman’s floor was two years old. There have
been significant advancements in radiant heat systems since that time. If Ms. Hoffman was
expecting state of the art performance, Ms. Hoffman’s expectations may not have been
reasonable, given the age of her system. All of the expert witnesses in this case stressed the
importance of consumer education so that homeowners had realistic expectations of how the
system would perform. Ultimately that is the underlying issue in this case. Ms. Hoffman was
not properly educated by Mr. Arnold as to what to expect from this type of system and so was
disappointed in the performance of the system, even though technically, it was working properly.
Based on these Findings, and in accordance with ORS 701 and 36, and OAR 812, I enter
the following:
AWARD
Complaint file number 80562-104 is dismissed.
Dated this 19th day of August, 2008
Anita C. Smith, Arbitrator
Catherine Hoffman and Basim Amin Ibsies, CCB File No. 80562-104
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