ALJDEC decisions subject to certification as final
2017A-4450-RFA-ROC · Registrar of Contractors · 2018-04-17
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Jacqueline Michelle Herring,
COMPLAINANT,
v.
Ronald James Morgan dba,
Titan Heating and Cooling ,
License No: 253880
RESPONDENT.
No. 2017A-4450-RFA-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: March 29, 2018, 8:30 A.M.
APPEARANCES: No appearances were made on behalf of Complainant or Respondent; the Arizona Registrar of Contractors was represented by Assistant Attorney General Michael Raine
ADMINISTRATIVE LAW JUDGE: Roger A. Geddes
_____________________________________________________________________
FINDINGS OF FACT
Background and Procedure
1. Ronald James Morgan dba, Titan Heating and Cooling (Respondent), is the holder of License Number 253880 issued by the Registrar of Contractors (Registrar).
2. On or about August 29, 2017, Jacqueline Herring (Complainant)
filed a Complaint against Respondent alleging poor workmanship in connection with a contract she had entered into with Respondent on August 15, 2017. (Registrar Exhibit 2).
3. Thereafter, a Citation was issued to Respondent, dated October 16, 2017, for the alleged violations of A.R.S. § 32-1154(A)(2), A.R.S. § 32-1154(A)(3), A.R.S. § 32-1154(A)(17), and A.R.S. § 32-1154(A)(22). (Registrar Exhibit 1).
4. Due to Respondent’s failure to file a timely Answer, the Registrar issued a Final Administrative Decision and Order on November 8, 2017, finding that Respondent had violated A.R.S. § 32-1154(A)(2), A.R.S. § 32-1154(A)(3), A.R.S. § 32-1154(A)(17), and A.R.S. § 32-1154(A)(22) as charged in the Complaint. (Registrar’s Exhibit 1). Pursuant to the Order, Respondent’s License Number 253880 was revoked and civil penalties totaling $1,250.00 were imposed.
5. On or about November 22, 2017, Complainant filed claim 2017-4450 against license number 253880 with the Residential Contractors’ Recovery Fund (“Recovery Fund”) seeking the amount of $2,100.00 (Registrar’s Exhibit 2).
6. Claims Reviewer of the Recovery Fund Jessica Ortiz reviewed all documentation in claim 2017-4450. In Ms. Ortiz’s review, she noted that at the time Complainant entered into the subject contract with Respondent, Respondent’s License Number 253880 had been in inactive status since June 8, 2016. (Registrar’s Exhibit 3). Ms. Ortiz further noted that the residence at which Respondent performed work was listed as a rental residence in Pima County Assessor’s Office records. (Registrar’s Exhibit 4).
7. On January 4, 2018, the Registrar issued a Notice and Order of Recovery Fund Ineligibility. (Registrar’s Exhibit 5).
8. Complainant filed a timely request for hearing on the Registrar’s Notice of Claim for Administrative Payout.
9. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing regarding the amount and/or propriety of the payment from the Recovery Fund.
10. The Registrar issued a Notice of Hearing that set a hearing for March 29, 2018, at 8:30 A.M. The Registrar mailed a copy of the Notice of Hearing to Complainant and Respondent on or about February 16, 2018, at their respective addresses of record.
11. The Notice of Hearing informed the parties that “[f]ailure to attend the scheduled hearing is likely to result in an adverse ruling against you.” The Notice of Hearing further advised of the procedure for requesting a continuance of the hearing.
12. Although the commencement of the hearing was delayed approximately 20 minutes, neither Complainant nor Respondent appeared at any time during the hearing through an authorized officer, employee, attorney, or any other person. Consequently, Complainant did not present any evidence to refute the Registrar’s denial of an award from the Recovery Fund. Complainant further did not request to appear telephonically and did not request that the hearing be continued.
13. At hearing, the Registrar presented the testimony of Jessica Ortiz. The Tribunal received and admitted the Registrar’s exhibit numbers 1 - 7.
14. Jessica Ortiz testified on behalf of the Registrar that she had personally reviewed Complainant’s claim for payment from the Recovery Fund. Ms. Ortiz said that she determined that Complainant was not eligible because Respondent’s license was inactive on August 15, 2017, the date Complainant entered into the subject contract with Respondent. She further testified that the subject property was listed as rental property in county records, but she acknowledged that Complainant had earlier informed her that the property was misclassified.
CONCLUSIONS OF LAW
1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.
2. In order to obtain an award from the Recovery Fund, an applicant must provide proof to establish by a preponderance of evidence that they are eligible pursuant to A.R.S. § 32-1131, et seq. Further, if eligible, an applicant must establish by a preponderance of evidence that damages sought are within the limitations of compensability as set forth in A.R.S. § 32-1132(A). See Arizona Administrative Code Rule 2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372 (1952).
3. “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 at p. 1220 (8th ed. 1999).
4. The Registrar’s final decision in the underlying workmanship case established that Respondent did not comply with the Registrar’s Directive and that Complainant potentially was a person who had been injured by Respondent’s violation of A.R.S. § 32-1154(A)(2), A.R.S. § 32-1154(A)(3), A.R.S. § 32-1154(A)(17), and A.R.S. § 32-1154(A)(22). As Complainant has potentially established that she is a person injured by Respondent’s violations, the issue remains whether Complainant has complied with the other criteria to be eligible to access the Recovery Fund.
5. A.R.S. § 32-1132(A) describes the measure of damages that an eligible homeowner is entitled to recover from the Recovery Fund in relevant part 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. . . . 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....
(emphasis added).
6. A.R.S. § 32-1131(3)(a) reads that a "Person injured":
Means any owner of residential real property that is either noncommercial historic property as defined in section 42-12101 or classified as class three property under section 42-12003. The property must also be actually occupied or intended to be occupied by the owner as a residence including community property, tenants in common or joint tenants who are damaged by the failure of a residential contractor or a dual licensed contractor to adequately build or improve a residential structure or appurtenance on that real property.
(emphasis added). Under A.R.S. § 42-12003(A), class three property consists of:
1. Real and personal property and improvements to the property that are used as the owner's primary residence, that are not otherwise included in class one, two, four, six, seven or eight and that are valued at full cash value.
2. Real and personal property that is occupied by a relative of the owner, as provided by section 42-12053, and used as the relative's primary residence, that is not otherwise included in class one, two, four, six, seven or eight and that is valued at full cash value.
3. Real and personal property that is owned and occupied as the primary residence of the owner who also uses the property for lease or rent to lodgers.
7. An award from the Recovery Fund is subject to a limitation that an award is not available to persons if the contractor’s license was inactive at the time of the contract. The Registrar established that Respondent’s contractor’s license had been inactive since June 8, 2016. Therefore, an award from the Recovery Fund is not available to Complainant due to Respondent’s inactive license status on August 15, 2017, the date on which Complainant entered into the subject contract with Respondent.
8. The Registrar also established that the property in question was not classified as class 3 property under A.R.S. § 42-12003(A) and consequently Complainant did not meet the definition of a “person injured” for purposes of an award from the Recovery Fund.
9. Accordingly, the Registrar did not err in denying a payout to Complainant from the Recovery Fund.
RECOMMENDED ORDER
In view of the foregoing, it is recommended that on the effective date of the final order in this matter, that Complainant’s claim to the Residential Contractors’ Recovery Fund be denied with no payment to Complainant from 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 five days from the date of that certification.
Done this day, April 18, 2018.
/s/ Roger Geddes
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors