ALJDEC decisions subject to certification as final
2015A-3660-RFA-ROC · Registrar of Contractors · 2018-03-19
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Virgil Stan
COMPLAINANT
-v-
Lyle Lee Hemphill DBA: White Mountain Roofing
License No. 151129
RESPONDENT
No. 2015A-3660-RFA-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: February 21, 2018
APPEARANCES: Complainant Virgil Stan appeared on his own behalf. Respondent Lyle Lee Hemphill doing business as White Mountain Roofing was represented by John Salskov. The Arizona Registrar of Contractors was represented by Assistant Attorney General John Tellier.
ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer
_____________________________________________________________________
FINDINGS OF FACT
The Arizona Registrar of Contractors (Registrar) issued License No. 151129 to Respondent.
On or about August 25, 2015, the Registrar received a Complaint against Respondent from Complainant alleging, among other things, that Respondent’s work installing a metal roof at Complainant’s home did not comply with the Registrar’s workmanship standards (the workmanship complaint).
As a result of the workmanship complaint, the Registrar issued a Citation against Respondent charging possible violations of A.A.C. R4-9-108, and thereby of A.R.S. § 32-1154(A)(3), and A.R.S. § 32-1154(A)(22).
Respondent did not file a timely answer to the Citation. Therefore, the Registrar issued a Final Administrative Decision and Order on December 13, 2016, in which the Registrar found that Respondent had violated the provisions of A.R.S. § 32-1154(A)(3) and (22) as charged in the complaint. Due to the violations, the Registrar suspended Respondent’s license for a period of one day.
Complainant then filed a claim with the Residential Contractors’ Recovery Fund (the Fund) to recover the cost of fixing the roof. As part of the claim process, Complainant submitted bids from three different contractors that Complainant had received to correct the project.
During the review of Complainant’s claim, the Registrar determined that the property was not classified as a Class 3 property with the county assessor’s office at the time of the contract or at the time of the claim, but was a Class 4 property at all times relevant to the claim.
After the Registrar notified Complainant regarding the classification issue, Complainant had the property reclassified as a Class 3 property.
After the property was reclassified as a Class 3 property, the Registrar issued a Notice of Claim for Administrative Payout, finding that Complainant’s actual damages were $15,600.00. Respondent requested a hearing, believing the payout was inappropriate. Complainant did not contest the amount of the administrative payout. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.
Jessica Ortiz, Claims Reviewer for the Fund, testified that the Fund allows people to fix an error in the classification of their property to enable them to access the Fund.
John Riesgo, Complainant’s son-in-law, testified that Complainant spent more than six months of the year living in the home for the past 20 years and the classification was an error. Mr. Riesgo acknowledged that Complainant owned a property in Tucson that was recorded as a Class 3 property at the time of the contract, but asserted that the classifications of both properties was an error. Mr. Riesgo stated that the property had never been a rental property.
Respondent indicated that Complainant had filed a claim with its bond company, but the claim was denied because the property was not classified as a residential property at the time of the contract. Respondent asserted that, at a minimum, any payout to Complainant should be reduced by the amount of the $4250 bond that was not paid out because of the classification of the property.
CONCLUSIONS OF LAW
This matter lies within the Registrar’s jurisdiction.
Respondent bears the burden of proof to establish that the proposed payout from the Fund is incorrect by a preponderance of the evidence.
“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” 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.”
A.R.S. § 32-1131(3) defines a “person injured” as “any owner of residential real property that is . . . . classified as class three property under section 42-12003.”
The Arizona Court of Appeals has ruled that “[t]wo relevant times for determining whether a claimant is a ‘person injured’ as defined in A.R.S. § 32-1131(3) and eligible to recover from the Fund pursuant to A.R.S. § 32-1132(A) are when the owner and contractor enter into the contract and when the claim accrues.”
The uncontroverted evidence presented at the hearing established that the property was not classified as a class three property at the time of the contract or at the time the claim was filed by Complainant.
Because the property was not classified as a class three property at the time of the contract or at the time the claim accrued, Complainant was not a “person injured” as defined by the statute. Therefore, Complainant is not eligible for a payout from the Fund.
RECOMMENDED ORDER
Based on the foregoing, it is recommended that on the effective date of the Registrar’s final order, Complainant’s claim 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, March 19, 2018
/s/ Tammy L. Eigenheer
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors