ALJDEC decisions subject to certification as final

2009A-7100450-ROC · Registrar of Contractors · 2011-05-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 2, 2011 APPEARANCES: Gerald E. Moore and Judith A. Moore appeared personally. D M R Construction, Inc. did not appear. The Registrar of Contractors was represented by Assistant Attorney General Keely Verstegen. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT 1. D M R Construction, Inc. (“Respondent”) is the holder of License No. 151957, a Class B contracting license issued by the Registrar of Contractors (“Registrar”). 2. On August 8, 2008, Respondent entered into a written contract with Gerald E. Moore and Judith A. Moore (“Complainants”) for a remodeling project at Complainant’s residence in Payson, Arizona. 3. Complainants filed a written Complaint with the Registrar alleging deficient workmanship by Respondent on the subject project. The Registrar designated the Complaint as Case No. P09-0185. By letter dated April 22, 2009, Respondent’s bonding company sent Complainants a check in the amount of $5,000.00 for damages. 4. On November 17, 2009, the Registrar issued a Decision and Order in Case No. P09-0185 due to Respondent’s failure to file an answer to the Citation and Complaint. The Decision and Order suspended Respondent’s contracting license until Respondent rectified the Complaint items and imposed a $500.00 civil penalty. 5. By letter dated December 7, 2009, Complainants submitted three bids from contractors to correct and complete the subject project. However, Complainants further advised that they completed the work themselves using “contract work”[1] and their own labor. 6. On December 14, 2009, Complainants filed a Recovery Fund Claim seeking an administrative payout from the Residential Contractors’ Recovery Fund (“Fund”) administered by the Registrar. The Registrar originally designated the claim as Case No. 10-0450, but later re-designated it as Case No. 2009-7100450. 7. The amount of Complainants’ claim is $32,559.61. 8. The Registrar’s assigned inspector, Tom Sandoval, reviewed Complainants’ claim. After completing his review, Inspector Sandoval recommended that Complainants be awarded a Fund payout in the amount of $3,570.00. 9. Complainants appealed Inspector Sandoval’s recommendation. 10. The Registrar forwarded Complainants’ appeal to the Office of Administrative Hearings, an independent agency, for an evidentiary hearing. 11. The Registrar issued a Notice of Recovery Fund Eligibility/Payout Hearing (“Notice”) in Case No. 2009-7100450 advising the parties of the time, date, and location of the formal hearing. The Notice was sent to the parties at their addresses of record with the Registrar. 12. The commencement of the hearing was delayed 15 minutes to allow for the late arrival of Respondent’s authorized representative. After the delay, the Administrative Law Judge conducted the hearing in Respondent’s absence. 13. The Registrar properly credited the $5,000.00 that Complainants received from Respondent’s bonding company from Complainants’ claim. 14. At hearing, Inspector Sandoval testified that the claim for expenses related to tools purchased by Complainants for completing the project was not considered damages or a loss. Inspector Sandoval further testified that if Complainants had hired a licensed contractor to complete the project, the licensed contractor would have had tools to perform the work. 15. Complainants failed to establish that their purchase of tools to complete the project constituted damages recoverable from the Fund. 16. After hearing evidence presented during the hearing, Inspector Sandoval amended his recommendation for an award to Complainants in the increased amount totaling $3,764.60. 17. Complainants are injured persons as defined in the statute and are entitled to receive payment from the Fund for damages sustained as a result of Respondent’s acts or omissions. 18. A review of the Registrar’s official electronic licensing records reveals that Respondent’s License No. 151957 was revoked on March 1, 2010. 19. It is found based upon the evidence of record that the sum of $3,764.60 represents a proper and reasonable amount payable to remedy Respondent’s violations of the State’s contracting laws which gave rise to the instant claim for damages. CONCLUSIONS OF LAW 1. The Registrar is empowered to determine and award proper payment to Complainants from the Fund pursuant to A.R.S. §32-1154(F). 2. Pursuant to A.A.C. R2-19-119(B), Complainants have the burden of proof in this matter. The standard of proof is by a preponderance of the evidence. A.A.C. R2-19-119(A). 3. Respondent was a “residential contractor” at the relevant times in this matter pursuant to A.R.S. §32-1131(4). 4. Complainants are persons injured pursuant to A.R.S. § 32-1131(3). 5. The Registrar properly deducted the $5,000.00 payment received by Complainants from Respondent’s bonding company, as required by A.R.S. § 32-1136(E). 6. Pursuant to A.R.S. § 32-1132(A), “[a]ctual 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.” 7. The evidence of record supports an award to Complainants in the amount of $3,764.60, all of which shall be appropriately chargeable against Respondent and/or persons on the license as set forth in A.R.S. § 32- 1139(B). RECOMMENDED ORDER On the effective date of the Order entered in Case No. 2009-7100450, the Registrar shall commence and finalize payment procedures from the Fund to Complainants in the amount of $3,764.60 for damages. 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, May 23, 2011.

/s/ Brian Brendan Tully Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] The contract workers were unlicensed contractor.

-----------------------

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