ALJDEC decisions subject to certification as final

2009A-7100044-ROC-rf · Registrar of Contractors · 2011-10-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 6, 2011, at 8:00 a.m. APPEARANCES: The Complainants appeared through Bruce Minkus. The Respondent failed to appear. ADMINISTRATIVE LAW JUDGE: M. Douglas

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made: FINDINGS OF FACT 1. On June 24, 2011, the Registrar of Contractors issued a Notice of Claim for Administrative Payout. The said notice provides, in pertinent part, as follows: The Complainants named above filed a claim for payment with the Residential Contractors’ Recovery Fund pursuant to A.R.S. § 32- 1154(F). After a review of the claim and all supporting documentation, the Fund has determined that Complainants are to be awarded $30,000.00 in the form of a payment issued by the Fund. In accordance with A.R.S. § 32-1154(F), both Complainants and Respondent have fifteen (15) days from the date of mailing of this Notice or until July 9, 2011, to request an administrative hearing to contest the amount and/or propriety of the payment. As provided in A.R.S. § 32-1154(F), the failure of Complainants and/or Respondent to file a timely written request for a hearing shall be deemed a waiver to contest the amount and/or propriety of the payment awarded.

If a timely request for hearing is received, this matter shall be set for an administrative hearing. If an administrative hearing is held in this matter the administrative hearing shall be limited in scope to determine the amount and/or propriety of the payment. Complainants are required to bear the burden of proof with regard to their entitlement to the amount noticed. Respondent may not present evidence and testimony with regard to the already established contracting violations. If the matter is set for an administrative hearing based solely upon a request for hearing submitted by Respondent, Complainants may not seek payment in an amount greater than set forth in this Notice. If the matter is set for an administrative hearing based upon a request for hearing submitted by Complainants, Respondent may be subject to liability for a payout in excess of the amount Noticed above, up to the statutory maximum of $30,000.00 per property per person. A.R.S. § 32-1132(A).

2. There was no dispute that on April 1, 2008, the Complainants filed a formal complaint against the Respondent with the Registrar of Contractors regarding abandonment and poor work on the construction project at their residence. 3. There was no dispute that pursuant to the filing of the formal complaint, a Citation and Complaint was issued against the Respondent. 4. The Respondent failed to file a written Answer in a timely manner and a default Decision and Order was issued on January 13, 2009. 5. The Respondent failed to comply with the terms of the default Decision and Order, and the Respondent’s License was suspended on September 17, 2009 pursuant to the terms of said Order. 6. The Respondent’s License was then revoked on November 9, 2009 (Case No. T09-0321). 7. Undisputed credible testimony and evidence established that the Complainants paid an alternative licensed contractor, Exquisite Creations (License No. 180634) the sum of $64,452.85 to properly correct the Respondent’s poor workmanship and complete the construction project at their residence. 8. During the hearing, the Complainants introduced copies of canceled checks paid to Exquisite Creations totaling the sum of $64,452.85. 9. Undisputed credible testimony and evidence established that the sum of $64,452.85 was necessary and justified to properly perform the construction work necessary to correct the Respondent’s poor workmanship and to complete the construction work on the Complainants’ residence. 10. There was no dispute that there was an unpaid balance of $3,967.04 remaining on the Complainants’ construction contract with the Respondent which must be deducted from the sum of $64,452.85 actually paid by the Complainants for the correction and completion of the construction project at issue, leaving the sum of $60,485.81 as the amount of the Complainants’ actual damages in this matter. 11. Based upon credible evidence produced at hearing, it is found that a proper and reasonable amount payable to the Complainants from the Contractors’ Recovery Fund for the Complainants’ actual damages is the sum of $30,000.00, representing the maximum amount that can be awarded in this matter for the Complainants’ actual damages. CONCLUSIONS OF LAW 1. A.R.S. 32-1132(A) provides as follows: 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 the county where the violation occurred an amount of not more than thirty thousand dollars for damages sustained by the act, representation, transaction or conduct. An award from the fund 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. Actual damages shall not be established by bids supplied by or the value of work performed by a person or entity that is not licensed pursuant to this chapter and that is required to be licensed pursuant to this chapter. If the claimant has paid a deposit or down payment and no actual work is performed or materials are delivered, the award of actual damages shall not exceed the exact dollar amount of the deposit or down payment plus interest at the rate of ten per cent a year from the date the deposit or down payment is made or not more than thirty thousand dollars, whichever is less. Interest shall not be paid from the fund on any other awards under this chapter unless ordered by a court of competent jurisdiction. An award from the fund shall not be available to persons injured by an act, representation, transaction or conduct of a residential contractor who was not licensed pursuant to this chapter or whose license was in an inactive status, expired, cancelled, revoked, suspended or not issued at the time of the contract. No more than the maximum individual award from the fund shall be made on any individual residence or to any injured person. Notwithstanding any other provision of law, monies in the residential contractors' recovery fund shall not be directly awarded for attorney fees or costs except in contested cases appealed to the superior court. 2. Under the facts and circumstances of this matter, the Registrar is empowered to determine and award proper payment to the Complainants from the Contractors’ Recovery Fund pursuant to A.R.S. 32-1154(F). 3. Undisputed credible testimony and evidence supported findings which support an award from the Contractors’ Recovery Fund to the Complainants in the sum of $30,000.00 all of which shall be appropriately chargeable against the Respondent and/or persons on the Respondent’s license as set forth in A.R.S. 32-1139(B) RECOMMENDed order In view of the foregoing, it is recommended that the Registrar shall commence and finalize payment procedures from the Contractors’ Recovery Fund to the Complainants in the total amount of $30,000.00, the maximum amount that can be awarded to the Complainants for their actual damages in this matter. In the event of certification of this 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 the certification. Done this day, October 6, 2011.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors -----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826