ALJDEC decisions subject to certification as final

2012A-999-ROC · Registrar of Contractors · 2012-11-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 5, 2012, at 8:00 a.m. APPEARANCES: Complainants Cesar V Zambrano and Sisely R Donning appeared on their own behalf; Respondent Abode Air LLC did not appear; the Arizona Registrar of Contractors appeared through Assistant Attorney General Nancy J. Beck. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________

FINDINGS OF FACT 1. In November 2005, the Arizona Registrar of Contractors (“the Registrar”) issued License No. C39R.212859-R to Abode Air LLC (“Respondent”).[1] Respondent’s address of record is 3832 East Alder Avenue, Mesa, Arizona 85206-1051. 2. On February 23, 2012, the Registrar received a Complaint against Respondent from Cesar Zambrano (“Complainant”) alleging that he paid for a service call and parts for his air conditioner at Complainant’s house at 11720 South 208th Lane, Buckeye, Arizona (“the house”) that were supposed to be covered under the warranty that he purchased from Respondent. According to the Complaint, the date of the contract was February 21, 2010, and Respondent had last performed work on the air conditioner on September 12, 2011. 3. On July 17, 2012, Complainants filed a claim in the amount of $7687.02 to the Residential Contractors’ Recovery Fund (“the Fund”) to recover the cost of the air conditioner warranty, work covered by the warranty that was paid for, and a return check fee. The Registrar designated Complainant’s claim as Case No. 2012-999. 4. On August 6, 2012, the Registrar issued a Notice to Claimant of Recovery Fund Ineligibility in Case No. 2012-999 because “[t]he property was not Class 3 residential property under A.R.S. § 42-12003 at the time of contract” and “[t]he property was a rental or income generating property classified as Class 4 property under A.R.S. § 42-12004 at the time of contract.” 5. Complainants requested a hearing on the Registrar’s determination that their claim was ineligible. The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent agency, for an evidentiary hearing. 6. On October 5, 2012, the Registrar issued a Notice of Recovery Fund Eligibility/Payout Hearing. The Registrar sent a copy of the Notice of Recovery Fund Eligibility/Payout Hearing to Respondent at its address of record. 7. A recovery fund payout hearing was held on November 5, 2012, at 8:00 a.m. 8. Respondent did not request to appear telephonically at the hearing and did not request that the hearing be continued. Although the hearing did not conclude until approximately 8:40 a.m., Respondent did not appear through an authorized member, employee, or attorney. Consequently, Respondent did not present any evidence. 9. The Registrar submitted documentary evidence from the Maricopa County Assessor establishing that from 2009 through July 18, 2012, the property where the house was located was classified as Class 4, Rental Residential. 10. Complainants acknowledged the house was classified as Class 4 with the Maricopa County Assessor, but indicated they had requested the classification be changed to Class 3 because they lived in the home. Therefore, they argued that they met statutory requirements to be eligible to recover the cost of the air conditioner warranty, work covered by the warranty that was paid for, and a return check fee from the Fund. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction. See 32-1101 et seq. The Notice of Recovery Fund Eligibility/Payout Hearing that the Registrar mailed to Respondent at its address of record was reasonable. Respondent is deemed to have received the Notice of Recovery Fund Eligibility/Payout Hearing. See A.R.S. §§ 41-1092.04; 41-1092.05(D). Complainants bear the burden of proof and must establish eligibility to recover from the Fund by a preponderance of the evidence. See A.R.S. § 41- 1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.” Black’s Law Dictionary 1220 (8th ed. 1999). A.R.S. § 32-1131(3) defines a “person injured” who is eligible to recover from the Fund as “any owner of residential real property which is classified as class three property under section 42-12003 and which is actually occupied or intended to be occupied by the owner as a residence . . . .” The Arizona Court of Appeals has determined that the times when the owner of residential property must meet the requirements of A.R.S. § 32- 1131(3) to be eligible to recover a payout from the Fund are: (1) When the owner enters the contract with the contractor for the work to be performed, and (2) When the contractor performs the work and commits the statutory violation that injured the owner.[2] Arizona statute provides that “class three is established consisting of real and personal property and improvements to the property that are used for residential purposes, that are not otherwise included in class one, two, four, six, seven or eight and that are valued at full cash value. . . .” A.R.S. § 42-12003(A). Arizona statute provides “class four is established consisting of . . . [r]eal and personal property and improvements to the property that are used solely as leased or rented property for residential purposes, that are not included in class one, two, three, six, seven or eight and that are valued at full cash value.” A.R.S. § 42-12004(A)(1). “In applying a statute, . . . its words are to be given their ordinary meaning unless the legislature has offered its own definition of the words or it appears from the context that a special meaning was intended.” Mid Kansas Federal Savings and Loan Ass’n of Wichita v. Dynamic Development Corp., 167 Ariz. 122, 128, 804 P.2d 1310, 1316 (1991). A.R.S. § 32-1131(3) requires that property be classified as Class 3 property under A.R.S. § 42- 12003 for its owner to be eligible to recover damages from the Fund. Complainants did not present any evidence that the property on which the house is located was classified as Class 3 property, rather than Class 4 property, in February 2010, when they entered the contract with Respondent, or at any time between February 2010 and September 2011, when Respondent last performed work on the house. Therefore, Complainants did not establish that they were eligible for an award from the Fund. RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Registrar’s final order, Case No. 2012-999 be closed as Complainant being deemed ineligible to access the Recovery 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 Order will be 40 days from the date of that certification.

Done this day, November 26, 2012.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Respondent’s license was revoked effective September 7, 2011. [2] See McMurren v. JMC Builders, Inc., 204 Ariz. 345, 350, 63 P.3d 1082, 1087 (App. 2003) (citing A.R.S. § 32-1132(A)). In that case, after the residence in which the homeowner had been living at least part-time was damaged by fire, the homeowner hired the contractor to perform repairs. Because the dwelling was uninhabitable after the fire, the homeowner lived temporarily in a motor home parked in the driveway. The residence subsequently was turned into a group home. The court held that the homeowner had established that he was eligible for a payout from the Fund because he had lived in the residence when he entered the contract for the contractor to repair the damages and while the contractor performed the repairs. See id. at 351, 63 P.3d at 1088.

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

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