ALJDEC

01F-RF0321-ROC-rhg · Registrar of Contractors · 2002-01-22

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

REHEARING: January 2, 2002. APPEARANCES: The Plaintiff, Larry Thompson, appeared personally. The Defendant was represented by its attorney, David Cantelme, Esq. The Registrar of Contractors was represented by Assistant Attorney General Victoria Martin. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________

Evidence and testimony were presented and, based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT

1. This matter came on for rehearing to determine Plaintiff’s entitlement to an administrative payout from the Residential Contractors’ Recovery Fund (“Fund”) in the amended amount of $7,657.62 for damages. The Plaintiff has filed an amended claim in that amount which includes the original claim for damages and subsequent damages discovered during remedial repairs. 2. The Registrar of Contractors administers the Fund from which any person injured by a licensed contractor may be awarded compensation for actual damages suffered by the claimant as a direct result of the contractor’s violation of the State’s contracting laws. 3. Plaintiff is the resident at 1102 East Le Marche Avenue, Phoenix, Arizona. 4. In June of 1999, Joseph Hemer was the owner of 1102 East Le Marche Avenue, Phoenix, Arizona. 5. Mr. Hemer contracted to sell the subject residence to Virginia A. Thompson. 6. Virginia A. Thompson is the Plaintiff’s mother. 7. At the time of the impending sale the house’s roof was damaged. The parties’ sales contract provided that the roof would be repaired. 8. The Defendant was hired by the listing agent, Dale Chandler, to perform the repairs to the property’s roof. 9. Plaintiff did not hire the Defendant. 10. Plaintiff observed the roof repairs being performed and approved those repairs. 11. The sale of the subject house was consummated. Mrs. Thompson is the fee simple owner of the property. 12. Mrs. Thompson is the mortgagee for the property’s mortgage. Plaintiff is not a mortgagee. 13. Mrs. Thompson does not occupy the property. She lives in Detroit, Michigan. 14. Plaintiff does not own the subject property. He does live at the residence and pays the mortgage payments from his own funds. 15. On or about October 3, 2000, Plaintiff filed a disciplinary complaint with the Registrar of Contractors alleging that Defendant had violated provisions of the State’s contracting laws during the performance of roofing work at his residence. 16. On or about October 25, 2000, the Registrar of Contractors wrote a letter to Plaintiff to advise that the agency declined to take administrative action at that time on his complaint because the Defendant’s license had been revoked on October 19, 2000. The letter further advised Plaintiff that if he was the owner/occupant of residential property, then he might be eligible to file a claim against the Fund for damages caused by Defendant. 17. On or about November 10, 2000, Plaintiff filed a Fund Claim form with the Registrar of Contractors. 18. In his Fund Claim form, Plaintiff answered “Yes” to the following question: “Do you own and occupy the residence.” 19. At the end of his Fund Claim form, the Plaintiff made the following verification: “I verify under penalty of law that the statements contained in this claim are true to the best of my knowledge and belief.” 20. Included with Plaintiff’s submitted Fund Claim form were the following estimates for repairing the damage allegedly caused by Respondent:

a) Gary and Son Roofing Inc. - $5,800.00, including sales tax; b) Pride Roofing - $4,500.00, including sales tax; and c) Modern Renovation & Repair, Inc. - $8,275.00.

21. On or about February 14, 2001, the Registrar’s assigned inspector, Mel Purchase, created a Recovery Fund Inspection Report in response to Plaintiff’s initial claim. Based upon Plaintiff’s verified claim, Inspector Purchase made certain findings, including, but not limited to, the following:

a) Claimant entered into an agreement for the re-roofing of a newly purchased home on 10-30-99. b) When claimant purchased the home, the seller was required to have the roof corrected. c) Money was held back in escrow to pay for the re-roofing. d) Claimant is the owner/occupant of the residence.

22. Inspector Purchase recommended that Plaintiff be awarded payment from the Fund in the amount of $4,500.00, which was the amount of the lowest submitted bid to repair the roof. 23. On May 29, 2001, this matter originally came on for hearing before Administrative Law Judge Dorinda M. Lang of the Office of Administrative Hearings. Plaintiff appeared but the Defendant did not appear. 24. On or about May 31, 2001, Judge Lang issued a Recommended Decision of Administrative Law Judge which contained a recommendation that the Registrar order an administrative payout from the Fund to Plaintiff in the claimed amount. 25. Judge Lang’s recommendation for the administrative payout from the Fund was adopted by the Registrar. 26. On or about July 16, 2001, Plaintiff filed a request for rehearing with the Registrar of Contractors seeking to amend his claim due to additional roof leakage and ceiling damage detected during the period awaiting the results of the initial hearing. Plaintiff’s amended claim included work involving re-roofing, solar work and interior repairs. 27. In response to Plaintiff’s request for rehearing and his original verified Fund Claim form, Inspector Purchase prepared a Recovery Fund Inspection Report dated July 24, 2001. That report adopted his earlier report findings. Inspector Purchase recommended an administrative payout from the Fund to Plaintiff in the amount of $6,104.68. 28. On or about August 8, 2001, the Defendant, through counsel, filed a request with the Registrar for a rehearing. 29. On or about August 20, 2001, the Registrar of Contractors filed a request to intervene disputing the amount of reimbursement requested by Plaintiff in his request for rehearing. 30. On or about August 28, 2001, Judge Lang recommended that the Registrar of Contractors be permitted to intervene, and recommended that the requests for rehearing be granted. 31. By Order dated September 28, 2001, the Registrar adopted Judge Lang’s recommendation and ordered that the rehearing be granted. 32. During the hearing testimonial evidence was elicited from the Plaintiff that, notwithstanding his verified Fund Claim form stating that he was the owner of the subject property, he did not and does not have any ownership interest in the subject property. He does occupy the property. 33. The Registrar of Contractors had no knowledge that Plaintiff was not the owner of the subject property until he testified as such at the rehearing. The Registrar of Contractors had reasonably relied on Plaintiff’s verified Fund Claim form, communications with him and his testimony at the initial hearing which showed him as the property owner and occupant. 34. Plaintiff is found not to be a “person injured” as defined by statute. 35. Since Plaintiff is not a “person injured” as defined by statute, he is ineligible to receive an award of an administrative payout from the Fund for damages. 36. Plaintiff contends that he has received powers of attorney to manage his mother’s affairs. However, this claim is deemed his personal claim for an award from the Fund.

CONCLUSIONS OF LAW

1. Pursuant to A.R.S. § 32-1132, the Registrar of Contractors is the administrator of the Fund from which any person injured by a residential contractor may seek an award for damages sustained by the residential contractors acts or omissions. 2. Pursuant to A.R.S. § 32-1131(3), a “person injured” is defined as an “owner of residential property…which is actually occupied or intended to be occupied by the owner as a residence…who (is) damaged by the failure of a residential contractor…to adequately build or improve a residential structure or appurtenance on that real property.” Plaintiff is not a “person injured” under that applicable statute. Contrary to his previous statements made to the Registrar, Plaintiff is not the owner of the subject property. His mother is the owner. The instant claim is made by the Plaintiff as the owner of the property, which he is not. 3. A.R.S. § 32-1131(1) further provides that the term “person injured” includes “lessees of residential real property who contacted directly with a residential contractor or indirectly with a subcontractor of that contractor.” The evidence of record reveals that Plaintiff had no privity of contract with the Defendant or indirectly with any of its subcontractors. 4. The evidence of record is adequate to establish that Plaintiff is not a “person injured” pursuant to A.R.S. § 232-1131(1) and, therefore, lacks standing to receive an administrative payout from the Residential Contractors Recovery Fund for damages. 5. The instant claim for an administrative payout was made by Plaintiff, individually, and not as attorney-in-fact for his mother. Plaintiff failed to present any documentary evidence to establish the scope of the power of attorney granted to him by his mother on her behalf. However, Plaintiff presented himself to the Registrar of Contractors as the property owner, which he is not. Plaintiff is barred from raising any claims his mother may have during this rehearing because such representation does not comply with Rule 31 of the Rules of the Supreme Court which governs the representation of parties in administrative hearings. 6. The evidence of record warrants the denial of Plaintiff’s claim due to lack of standing. Such a denial does not preclude the Plaintiff seeking relief against the Defendant in other forums, if not otherwise prohibited by law.

RECOMMENDED ORDER

In view of the foregoing, it is recommended on rehearing that Plaintiff’s claim for an administrative payout from the Residential Contractors’ Recover Fund be denied. Done this day, January 22, 2002.

______________________________________ Brian Brendan Tully Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2002, to:

Registrar of Contractors Michael P. Goldwater, Director 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