ALJDEC decisions subject to certification as final

2009A-37570480-ROC · Registrar of Contractors · 2011-06-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 23, 2011

APPEARANCES: Personal Representative Thomas Russell appeared on behalf of the Complainant Estate; Respondent was represented by its Manager Neal Jones and Qualifying Party Amy Jones, but did not participate in the hearing; the Residential Contractors’ Recovery Fund intervened in this matter and was represented by Assistant Attorney General Montgomery Lee.

WITNESSES: Doug Ulmer, Recovery Fund Claim Reviewer Thomas Russell

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant seeks a payout from the Residential Contractors’ Recovery Fund (“Fund”) for damages caused by Respondent, as reflected in a Default Decision and Order that found Respondent had violated A.R.S. § 32- 1154(A)(7) by performing a wrongful act. The Fund appeared through Assistant Attorney General Montgomery Lee, challenging Complainant’s eligibility for payout from the Fund. The only issue for which the parties were given notice and for which the hearing was held is Complainant’s eligibility. The Fund contends that the damages claimed by Complainant are not the type allowed to be recovered by the statutes controlling Fund payouts. Complainant disagrees. This tribunal entered the claim file received from the Registrar of Contractors into the record, along with Exhibit 1 (a copy of the claim with attached stolen property inventory). Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order finding Complainant’s damages ineligible for recovery from the Fund. FINDINGS OF FACT 1. Respondent was the holder of license K-5.222701-D issued by the Registrar of Contractors (“ROC”). The license was revoked in September 2010. 2. Complainant made a complaint against Respondent in January 2009, alleging that employees of Respondent stole personal property from Earlene Esquibel’s residence after a fire occurred and Respondent was to perform remedial work on the jobsite. Complainant’s evidence showed that it claimed that the value of the stolen property was $18,540.00. Respondent defaulted by failing to timely answer the complaint and was found to be in violation of the statutes governing contractor licensing. 3. In September 2010, Complainant filed a claim with the Fund for recovery of the $18,540.00 that had been stated in the complaint. That amount would compensate Complainant for the value of the stolen property. 4. The Fund objects to payout on the claim, arguing that the Fund only covers amounts needed to complete or repair construction. 5. The parties appeared and argued at the hearing. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon the person asserting a claim.[1] Further, the standard of proof at hearing is by preponderance of the evidence.[2] Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that the damages sought are eligible for recovery from the Fund.[3] Complainant has not met that burden. 2. The Residential Contractors’ Recovery Fund is established to provide awards to persons who have been injured by a licensed contractor.[4] Recovery from the Fund is capped at $30,000.00 and “is limited to the actual damages suffered by the claimant as a direct result of the contractor's violation but shall not exceed an amount necessary to complete or repair a residential structure or appurtenance within residential property lines.”[5] 3. From the language quoted above, the Fund deduces that only damages that cover necessary completion or repair of construction work are eligible for an award from the Fund. This Administrative Law Judge agrees. 4. Complainant seeks damages that are not costs for repair or completion of construction work. 5. The damages sought by Complainant are not eligible for recovery from the Fund because they fall outside the scope of damages that are the type recoverable from the Fund as provided by statute. RECOMMENDED ORDER In view of the foregoing, IT IS RECOMMENDED that the Registrar of Contractors find that the claim filed by Complainant is not eligible for recovery from the Fund.

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 Decision will be 40 days from the date of that certification.

Done this day, June 10, 2011.

/s/ Eric A. Bryant Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949); Arizona Administrative Code (A.A.C.), OAH Rule R2-19-119(B). [2] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985); A.A.C. R2-19-119(A). [3] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996). [4] A.R.S. § 32-1132(A). [5] Id.

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