ALJDEC

00F-RF0424-ROC · Registrar of Contractors · 2000-10-12

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 28, 2000 APPEARANCES: Plaintiff Lois Burditt appeared through counsel, Julie Inderlied. Defendant Alpha and Omega Fiberglass Finishes failed to appear. The Contractors’ Recovery Fund (the “Fund”) was represented by Assistant Attorney General, Mary DeLaat Williams. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ Evidence and testimony were presented and, based upon the entire record in this matter, the following Findings of Fact, Conclusions of Law, and Recommended Order are submitted to the Director of the Arizona Registrar of Contractors. FINDINGS OF FACT Defendant’s contracting license has been previously revoked by final Order of the Registrar of Contractors. Such revocation is determined to render this Defendant unable to remedy the violation of the State’s contracting laws which gave rise to the instant claim for damages. The Registrar of Contractors has received advance notification of the existence and amount of the above named Plaintiff’s claim for an administrative payout from the Fund. This hearing was convened following Plaintiff’s express request therefor, subsequent to denial of her claim by the Fund. Plaintiff seeks to recover the sum of $4,600.00 from the Fund. The following salient facts were adduced at the hearing and are important to note: f. In November 1996, Plaintiff entered into a contract with Defendant regarding the resurfacing of Plaintiff’s pool. Neither party provided any details at the hearing regarding the specifics of the resurfacing work that was performed by Defendant. g. In the Spring of 1998, the resurfacing materials and installation began to fail. Also in the Spring of 1998, Plaintiff contacted Defendant and Defendant performed remedial work in an attempt to correct the deficiencies. h. In the Summer of 1998, the above described failure recurred. Plaintiff contacted Defendant and Defendant attempted to remedy the deficiency by resurfacing the entire pool once again. At the hearing, Plaintiff could not remember the exact date that Defendant performed this warranty work. Nevertheless, Plaintiff credibly testified that it was some time between October 6, 1998 and March 5, 1999. i. Defendant’s Class B-05 license was suspended on December 18, 1998 for failure to complete corrective work as ordered in Registrar of Contractors case no. 98-0947. j. Defendant’s Class B-05 license was revoked on April 13, 1999, in Registrar of Contractors case no. 99-0050. k. Defendant’s Class B-05 license was again revoked on May 13, 1999, in Registrar of Contractors case no. 98-0403. l. In the Summer of 1999, Plaintiff once again discovered deficiencies with the pool steps. After repeated attempts, Plaintiff was unsuccessful at inducing Defendant to remedy the failed warranty work. m. Plaintiff filed a complaint with the Registrar of Contractors against Defendant on January 26, 2000. The complaint indicated that Defendant last performed work on Plaintiff’s pool in May 1999. However, at the hearing, Plaintiff credibly testified that Defendant last performed work on her pool no later than March 5, 1999. n. As a result of the filing of the above mentioned complaint, Plaintiff was informed that Defendant’s license had been revoked. Thereupon, Plaintiff filed the instant claim for payout from the Fund. o. Although neither party addressed the reasonable cost to correct the deficiencies, the Administrative Law Judge acknowledges that Plaintiff obtained three estimates, all of which are contained in the case file. Plaintiff is requesting a payout in the amount of $4,600.00, which is the amount of the lowest bid received. p. The parties stipulated that the work Defendant last performed on Plaintiff’s pool was warranty work. The Fund argues that it has no exposure for the instant claim due to the fact that Defendant’s Class B-05 license may have been suspended at the time that Defendant last performed warranty work on Plaintiff’s pool. Regardless of the fact that the evidence of record was insufficient to support a definitive finding of the exact date upon which Defendant last performed work on Plaintiff’s pool, the evidence of record was sufficient to support a finding that Defendant had repeatedly been working on the pool during the time when it was properly licensed. Moreover, during the period of time when Defendant was properly licensed, it could have completed and/or corrected the deficiencies in the pool, but failed in this regard. Thus, Defendant violated this State’s contracting laws on this project during a period of time when it was properly licensed. The Fund is exposed to liability for Defendant’s substandard workmanship due to the fact that Defendant worked on the pool prior to the suspension of its license, and the fact that the Administrative Law Judge finds that Plaintiff’s claim relates to work performed by Defendant in the Spring of 1998. Thus, under all of the salient facts and circumstances of the instant case, it is determined that Plaintiff should be allowed access to the Fund.

CONCLUSIONS OF LAW A.R.S. §32-1132(A) provides in pertinent part, “an award from the fund is limited to the actual damages suffered…except that an award from the fund shall not be available to persons injured by a residential contractor whose license was…in an inactive status, expired, canceled, revoked or suspended…at the time of the contract.” The Administrative Law Judge concludes that the warranty work performed in the Spring of 1998, giving rise to Plaintiff’s claim, occurred during the period of time when Defendant was properly licensed. A.R.S. §32-1131, et. seq., is clearly a remedial statute designed to protect the public against the abuses of unscrupulous and/or incompetent contractors, and as such, the law would require a liberal interpretation in favor of those for whom the statute is designed to protect. The statutory language “at the time of contract” is sufficiently vague so as to allow for an interpretation that notwithstanding the fact that the contractor’s license may have been suspended at the time warranty work was last performed (the Fund argues that this is the time of contract because the contract is one of an ongoing nature), access to the fund would nevertheless be appropriate in those cases wherein a person is injured by an act (i.e. poor and/or incomplete work) of a contractor, committed at a time while the contractor is performing work on the contract and its contractor’s license is in good standing. Therefore, in light of the fact that Defendant was shown to have had its license in good standing during the period of time when the original warranty work giving rise to Plaintiff’s claim for damages occurred, the Fund is held to have exposure to liability for the claim. Plaintiff is determined to be an injured person as that term is defined in A.R.S. §32-1131(3). Under the facts and circumstances of this case, the Registrar of Contractors is empowered to determine and award proper payment to Plaintiff from the Contractors’ Recovery Fund pursuant to A.R.S. §32-1154(E). The within record supports an award to Plaintiff in the amount of $4,600.00, all of which shall be appropriately chargeable against Defendant and/or persons on the license as set forth in A.R.S. §32-1139(B). RECOMMENDED ORDER In view of the foregoing, it is recommended that on the effective date of the Order entered in this matter, the Registrar of Contractors shall commence and finalize payment procedures from the Contractors’ Recovery Fund to Plaintiff in the amount of $4,600.00.

Done this day, October 18, 2000.

_____________________________________ Sondra J. Vanella Administrative Law Judge

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

Michael P. Goldwater, Director Registrar of Contractors 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