ALJDEC decisions subject to certification as final

07F-RF0214-ROC · Registrar of Contractors · 2007-09-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 22, 2007 APPEARANCES: Plaintiff Russell Smith appeared on his own behalf. Defendant Martin Orozco appeared on his own behalf. Gabriela Contreras provided interpreting services. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Plaintiff Russell Smith is entitled to an award and payment from the Residential Contractors’ Recovery Fund pursuant to A.R.S. § 32-1132(A). Based on the evidence of record, the Administrative Law Judge renders the following Findings of Fact, Conclusions of Law and Recommended Order to the Director of the Registrar of Contractors. FINDINGS OF FACT 1. On or about February 2, 2004, Mr. Smith entered into a contract with Defendant Lucio Hernandez and Martin Orozco Rodriguez, doing business as California’s Concrete Coating (“CCC”), for CCC to re-coat Mr. Smith’s concrete driveway, walkway, and patio. 2. On or about December 27, 2005, Mr. Smith filed a complaint against CCC with the Registrar of Contractors (“ROC”). Mr. Smith generally alleged that the work performed by CCC was deteriorating rapidly in that the concrete coating was peeling, flaking, and loosening. 3. On May 19, 2006, the ROC issued a Citation and Complaint in Case No. G06-0749, charging CCC with violations of A.R.S. § 32-1154(A)(3), (A)(7), (A)(13), and (A)(23). 4. CCC failed to file a written answer to the Citation and Complaint and the ROC issued a default Decision and Order on July 6, 2006, ordering that CCC’s contracting license be revoked unless the ROC received proof that CCC had appropriately performed corrective work. CCC was also ordered to pay a $500.00 civil penalty. 5. The ROC’s Order indicated that the Order would be self-operative and that CCC had until August 15, 2006 to comply with the Order. The ROC’s Order indicated that the Order would become effective on August 15, 2006 and that any request for rehearing must be filed on or before August 10, 2006. The Order also set forth that any appeal to the Superior Court must be filed and a Stay Order secured on or before August 15, 2006. 6. CCC did not file a request for rehearing, nor did it file an appeal with the Superior Court. 7. On October 13, 2006, the ROC revoked CCC’s contracting license for failure to pay the civil penalty. 8. On or about October 2, 2006, Mr. Smith filed a claim with the ROC seeking payment from the Residential Contractors’ Recovery Fund (the “Fund”) in the amount of $4,109.00 for damages he alleged to have incurred as a consequence of CCC’s poor workmanship, including the cost to remove the coating as installed by CCC. 9. The ROC investigated Mr. Smith’s claim against the Fund and pursuant to its March 13, 2007 Notice to Contractor of Claim for Administrative Payout, recommended a payout in the amount of $3,910.12. 10. On March 23, 2007, Mr. Orozco requested a hearing regarding Mr. Smith’s claim, and this matter was thereafter set for hearing before the Office of Administrative Hearings. 11. ROC Recovery Fund Inspector Phil Pettice testified at hearing that on January 9, 2007, he conducted a jobsite inspection and observed areas of discoloration, peeling and chipping. Inspector Pettice opined that the entire job needs to be re-done due to the failure of the surface material. Inspector Pettice testified that he reviewed three bids from licensed contractors, obtained by Mr. Smith, and recommended a payout from the Fund in the amount of the lowest bid submitted by Desert Rose Color Shield. The other bids were from Armor Deck in the amount of $6,667.00 and Desert Custom Painting in the amount of $6,120.00. 12. Mr. Smith testified that he agrees with the recommended payout. 13. Mr. Orozco did not present any evidence that would support a modification of the recommended payout. Mr. Orozco urged that because he did not personally participate in the work that gave rise to the imposition of discipline against CCC’s license, he should not be held responsible. This argument is unpersuasive, as the license was issued to the partnership, with the result that each partner is responsible for the acts and/or omissions of the other partner. 14. Based on the foregoing, the Administrative Law Judge finds that Mr. Smith is entitled to receive an award from the Fund in the amount of $3,910.12. CONCLUSIONS OF LAW Under A.R.S. § 32-1132, the ROC is empowered to determine and award payment to Mr. Smith from the Fund. Mr. Smith meets all of the requirements of a “person injured” as that term is defined in A.R.S. § 32-1131(3). Pursuant to A.R.S. § 32-1132(A), “the residential contractors’ recovery fund is established, to be administered by the registrar, from which any person injured by an act, representation, transaction or conduct of a residential contractor licensed pursuant to this chapter that is in violation of this chapter or the rules adopted pursuant to this chapter may be awarded in . . . an amount of not more than thirty thousand dollars for damages sustained by the act, representation, transaction or conduct.” 4. The weight of the credible evidence presented at hearing demonstrated that Mr. Smith was injured as a result of CCC’s poor workmanship and that in order to rectify such, Mr. Smith is entitled to a payout from the Fund in the amount of $3,910.12. 5. Based on the foregoing, Mr. Smith should be awarded a total payout from the Fund in the amount of $3,910.12, all of which should be charged against CCC and/or persons named on CCC’s Class C-05 license as set forth in A.R.S. § 32-1139(B). RECOMMENDED ORDER The Administrative Law Judge makes the following Recommended Order: On the effective date of the Order entered in this matter, the ROC shall commence and finalize payment procedures from the Fund to Russell Smith in the amount of Three Thousand Nine Hundred Ten Dollars and Twelve Cents ($3,910.12). In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be 40 days from the date of that certification.

Done this day, September 10, 2007.

______________________________________ Sondra J. Vanella Administrative Law Judge

Original transmitted by mail this ____ day of September, 2007, to:

Fidelis V. Garcia, Director Registrar of Contractors Legal Department 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