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Sara Nichols will never again pick a contractor out of the Yellow Pages, but then, hindsight is always 20/20. Three years ago, when she and her husband, Bill Magavern, were buying a house on Capitol Hill, she didn’t know any better. They wanted to have the roof inspected before signing the contract, so they opened the yellow book and chose the roofer with the most appealing ad, a Laurel, Md., outfit called Medero Family Contracting. Motto: “Sealing the fate of your roof.”
Sealing, indeed. For $55, Medero examined the roof of the two-story house on 7th Street NE in February 1992, and concluded that $225 in minor repairs—“silvercoating”—was needed. But overall, the Medero inspector wrote on the estimate, the “roof is in good condition.” Acting upon that rosy assessment, Nichols and Magavern got $225 knocked off the selling price.
The roof of Nichols and Magavern’s house might have been in good condition compared to that of a rabbit hutch after a hurricane, but it was not in good enough condition to withstand a Washington summer thunderstorm. Shortly after they moved in, in July 1992, said roof sprung a severe leak over the rear bedroom.
The couple again called Medero Family Contracting, which now recommended installing a new, $2,600 roof that came complete with a 10-year warranty.
Just 17 months after the tar dried, a serious leak developed again—this time over the front bedroom. Nichols and Magavern asked Medero to fix it immediately, as the guarantee stipulated. But the couple says the company refused to send anyone until three months later, and on the scheduled date, a repair crew never showed.
Eventually, two other roofers told the couple that Medero had failed to properly “torch,” or seal, the roof. The entire thing had to be replaced once again.
Magavern and Nichols were left angry and frustrated. “Basically, they ripped us off a couple of different ways,” Nichols fumes.
“I’m completely unaware of a situation like this,” says Dave McCaffrey, president of Medero. “If there’s a problem, then I have no problem taking care of it.”
But the couple maintains that repeated pleas to Medero to act on its warranty went unheeded, forcing them to file a complaint—documented by the estimates and warranty—with the District’s Department of Consumer and Regulatory Affairs (DCRA) under the Consumer Protection Procedures Act in December 1994. If everything goes according to plan, DCRA will look into their complaint sometime in October.
Not this coming October, but October 1998. In one of the weirder cost-cuttingmeasures to emerge from the city’s budget crisis, the D.C. Council voted in December to suspend, for three years, all enforcement of the District’s two primary consumer-protection laws, the Consumer Protection Procedures Act and the Automobile Consumer Protection Act, better known as the “lemon law.”
Halting enforcement of these laws will let DCRA cut 13 positions, saving about $429,000 from its $21.4-million budget. It also leaves ripped-off consumers with no recourse other than the court system, a slow and expensive place to recover damages.
No recourse, and no warning either, for until a few weeks ago, DCRA hadn’t informed consumers that their complaints were not being pursued.
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Magavern only found out this month, when, after weeks of trying to follow up on his complaint by phone, he visited DCRA in person. He eventually made his way to the office of compliance, where he found staffers hanging around discussing O.J. Simpson. “They didn’t seem to be real busy,” he says. A staff attorney explained that they were prohibited from enforcing the law, and seemed genuinely upset about it. The desk in the lobby was unmanned and empty—except for a stack of blank complaint forms.
Last fall, Mayor Sharon Pratt Kelly ordered DCRA to cut 114 of its 540 positions. Director Hampton Cross said that required eliminating or privatizing key functions, including repealing the two consumer laws. “The impact,” Cross testified before the council, “will be an increase in consumer fraud and abuse, particularly among senior citizens and limited-income residents.”
Perhaps it was Cross’ dire prediction that prompted the council to suspend, rather than repeal, the two laws. But some consumer advocates wonder if the council was aware of the repercussions the staffing cuts had on DCRA’s mission.
“They just went at it with a meat cleaver,” says D.C. attorney Mark Steinbach, who specializes in lemon law cases. Instead of suspending enforcement, Steinbach believes DCRA should have hobbled along as best it could with a smaller staff. “There’s a deterrent effect to bad actors, in knowing that there is an agency that can enforce the law,” he says, adding that even very weak policing would be better than none at all.
Why pretend, counters Ted Gordon, acting chief of DCRA’s compliance branch. “Don’t leave me with the responsibility of enforcing a law if I’ve got nobody to enforce it,” he growls.
Although the suspension went into effect December 29, 1994, it applies to pending cases—such as Nichols and Magavern’s, which was filed two weeks before the suspension, and four others leveled at the employee-owned Medero Family Contracting. “We had complaints of shoddy work. We were making progress before the law was suspended,” Gordon sighs. Pending and new complaints will be “held in escrow” until 1998; consumers are advised to check the department’s index before they hire a contractor. The suspension does not eliminate a consumer’s right to go to court under either of the statutes.
The $429,000 question is: Has the abeyance of the consumer protection laws actually saved the city money?
Not yet. So far, the 13 jobs in question remain intact. And the city will forfeit fees generated by the compliance branch. In the past couple of years, the division has netted large settlements against companies including: Great Expectations dating service, for $30,000 (an additional $10,000 was paid to the government); Luxury Import, a used car dealer that sold cars without valid titles, for an undisclosed amount; and four invention promotion companies, which gulled hopeful inventors into believing that their creations could become the next FlowBee (see “The Smoker’s Shower Shield,” 4/2/93). The companies signed a $500,000 consent decree and paid the government $50,000. In fiscal 1994, the division obtained a total of $2.8 million in restitution to consumers, according to Gordon.
Suspending enforcement of the law will nullify another half-million-dollar consent decree with Capitol Ford, an auto dealership on Rhode Island Avenue NE. Capitol Ford had been accused of steering customers to a subsidiary, Mid-Atlantic Financing Co., that did not disclose its relationship with Capitol Ford and charged customers interest as high as 28 percent. Under the decree, Capitol Ford admitted no wrongdoing—in fact denied all the allegations—but agreed to pay each of the 2,200 customers that received financing from Mid-Atlantic between 1989 and 1993 a refund of $200, which was to be awarded from money paid by Capitol Ford to the District. (A fee of $50,000 was to be paid to the government.) But with the suspension of the law, the department must now return the money to Capitol Ford, according to a legal opinion from the Office of Corporation Counsel.
“We’ve been trying to work with DCRA to find a way to pay the customers,” says Kenneth Slaughter, an attorney with KeckMahin & Cate, which represents Capitol Ford. “This situation [at DCRA] might be seen as fortuitous for us, but we deal with that same group of customers, we want them to be happy with us. We have not in any way reneged. At worst we’ll be paying them in 1998.”
Nichols and Magavern’s patched roof won’t wait three years. They need a new one and their best estimate this time is $3,725. Meanwhile, they are considering pursuing Medero in court. Since both are lawyers with Ralph Nader’s consumer advocacy group Public Citizen, legal fees won’t be a problem. The alternative for most bilked consumers is to go down to DCRA headquarters at 614 H St. NW, take a sheet from the pile of blank forms found on the unoccupied desk marked by a sign that says “complaints,” fill it out, and wait.