State board should keep hands off class-action proceeds

THE ISSUE The state board overseeing contractors is seeking reimbursement from plaintiff homeowners in a class-action lawsuit.

HONOLULU homeowners are on the verge of being compensated for leaky roofs by a derelict Canadian company, and the state board that oversees contractors wants part of the proceeds. The board, which is supposed to protect consumers, should not gouge them to pay for fines and other penalties that the board should collect directly from the contractor.

Mark Wenzel, owner of Interlock Industries and related companies, said he has agreed to pay what could be millions of dollars to settle a class-action lawsuit brought by homeowners. Wenzel's company installed 2,700 roofs in Hawaii from 1997 to 2001, closing shop in Honolulu after leaving leaky roofs and useless lifetime guarantees.

The state fined Wenzel $205,000 and paid $25,000 from a state monetary pool to settle two consumer lawsuits, its limit, but has been unable to collect from Wenzel, although winning court orders. Instead, the state Contractors Land Board is asking a Circuit Court judge for reimbursement from the class-action settlement.

The state's attempt understandably has the class-action lawsuit's attorney fuming. "The state did nothing to help the thousands of people named in the class," George Ashford Jr. told the Star-Bulletin's Allison Schaefers. "I think it's ridiculous that it now feels entitled to reimbursement from our settlement."

Wenzel said the company's problems were related to the events of Sept. 11, 2001, and attributed installation problems to a former manager, Ricky King, a Canadian who said he has been victimized by the company in Canada and Hawaii. King said "tons of complaints" against the company in Hawaii had preceded his arrival in Honolulu. Similar complaints against the company's affiliates have surfaced in Washington and Oregon.

Interlock Industries is not a fly-by-night operation. The Better Business Bureau has given high marks to the company across Canada and the United States. Charlie Beeck Jr., a roofer and member of the Hawaii Roofing Contractors Association's ethics board, said Interlock's shingle is "a good product. It was the installation and warranty that were the problem."

A Wenzel company continues to operate in Hawaii but as a roofing supply company, not as an installer. Jo Ann Uchida, complaints and enforcement officer for the state Regulated Industries Complaints Office, said her agency's jurisdiction is confined to contractors and does not include suppliers.

However, as Wenzel continues to operate and make money in Hawaii, Uchida said her office "can try and convert those assets into something that we can collect."

Precisely. State agencies that exist to protect consumers should seek reimbursement for their efforts from companies that take advantage of them, not from the victimized consumers themselves.