ALJDEC decisions subject to certification as final

2019A-01374-RFA-ROC · Registrar of Contractors · 2020-06-23

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Raymond N Hadfield,

COMPLAINANT

Priv-Energy Group LLC,

License No. ROC 238137,

RESPONDENT

No. 2019A-01374-RFA-ROC

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: June 8, 2020

APPEARANCES: Raymond N Hadfield on his own behalf; no one appeared for Respondent; John Tellier, Esq. for the Registrar of Contractors

ADMINISTRATIVE LAW JUDGE: Thomas Shedden

FINDINGS OF FACT

On May 7, 2020 the Registrar of Contractors (“ROC”) issued a Notice of Recovery Fund Hearing setting the above captioned matter for hearing at the Office of Administrative Hearings on June 8, 2020. The issue is whether an award and payout from the residential contractors’ recovery fund is justified by the evidence.

Respondent Priv-Energy Group LLC holds license number 159590 issued by ROC.

Raymond Hadfield entered a contract with Respondent that called for Respondent to install a solar energy system and water heater at his house.

Mr. Hadfield subsequently filed with ROC a complaint against Respondent.

After receiving Mr. Hadfield’s complaint, ROC investigator Beau Cruz Cruz inspected the work.

After Mr. Cruz’s inspection, ROC issued to Respondent a Directive requiring Respondent to ensure that all required permits had been obtained, to verify that the system was working as intended, and to perform a load test on the main electric panel to ensure that the panel was sufficient to handle the load.

Subsequently, ROC issued to Respondent a citation.

Respondent did not file an answer to the citation. ROC issued a Final Administrative Decision and Order finding that Respondent had violated Ariz. Rev. Stat. section 32-1154(A)(2), (A)(3) and (A)(22) as charged in Mr. Hadfield’s complaint, and suspending Respondent’s license for seven days.

On November 7, 2019, Mr. Hadfield submitted to ROC a Recovery Fund Claim requesting a payout of $9176.64.

ROC evaluated Mr. Hadfield’s claim and determined that his actual damages were $426.64, which consisted of $235.00 to have a load test performed on the electric panel and $191.64 to obtain a permit. In a Notice of Claim for Administrative Award dated March 25, 2020, ROC informed the parties of its findings.

Mr. Hadfield requested a hearing, which led to this matter being conducted.

Mr. Hadfield’s position is that Respondent misrepresented the cost savings that would accrue from the installation of the solar system. He is requesting compensation for a second battery.

In support of his request for the second battery, he submitted a letter from Arizona Sun Services dated October 11, 2019. That letter shows that: Arizona Sun had adjusted the system’s program for more effective operation, and that Arizona Sun informed Mr. Hadfield that there was no way to promise the actual amount of savings, but that all savings would occur if usage was limited to off-peak hours. Arizona Sun also noted that the system was functioning well at that time (when the air conditioner was not in use), and the author “imagined” that the promised savings might occur if Mr. Hadfield purchased a second battery.

Mr. Hadfield acknowledged that his contract with Respondent called for only one battery, which he had received.

ROC determined that Mr. Hadfield was not entitled to a payout for the cost of a second battery because the battery he purchased was not faulty and because ROC through its Directive had not ordered Respondent to provide Mr. Hadfield with a second battery.

Mr. Hadfield argued to the effect that ROC is being too restrictive and that it should be protecting consumers from contractors who commit fraud.

CONCLUSIONS OF LAW

Unless otherwise provided by law, the party asserting a claim, right, or entitlement has the burden of proof. Ariz. Admin. Code § R2-19-119(B).

Mr. Hadfield filed a claim asserting that he is entitled to a payout from the Recovery Fund pursuant to Ariz. Rev. Stat. section 32-1132. Consequently, Mr. Hadfield bears the burden of proof show that he is an injured person who meets the requirements for a payout from the recovery fund. Ariz. Admin. Code § R2-19-119(B); see also Harvest v. Craig, 195 Ariz. 521, 524, ¶¶ 14-15 (App. 1999) (the party seeking a right granted by statute generally has the "burden of proving that he comes within the ambit of the statute").

The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119(A).

A preponderance of the evidence is:

The 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 1373 (10th ed. 2014).

Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").

“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).

The purpose of the recovery fund is to provide improved protection for owners and lessees of property who contract for the construction or alteration of residential structures. McMurren v. JMC Builders, 204 Ariz. 345 (App. 2003).

“The assessments received by the registrar for deposit in the fund shall be held in trust for carrying out the purposes of the fund.” Ariz. Rev. Stat. § 32-1135.

“‘Person injured’ means “any owner of residential real property which is classified as class three property under [a section of the tax code] and which is actually occupied or intended to be occupied by the owner as a residence . . . who [is] damaged by the failure of a residential contractor . . . to adequately build or improve a residential structure or appurtenance on that real property.” McMurren at ¶ 8; see also Ariz. Rev. Stat. § 32-1131(3).

Any “person injured” by a licensed residential contractor’s violation of ROC’s statutes or rules may be awarded up to $30,000 from the residential recovery fund. But an “award from the fund is limited to the actual damages suffered by the claimant as a direct result of the contractor's violation ....” Ariz. Rev. Stat. § 32-1132(A).

“‘Actual damages’ ... mean[s] the reasonable cost of completing the contract and repairing the contractor's defective performance ‘less the part of the contract price still unpaid.’” Ramsey v. Ariz. Registrar of Contractors, 241 Ariz. 102, ¶ 8 (App. 2016)(adopting ROC’s definition of actual damages).

Mr. Hadfield’s contract called for only one battery and it has not been shown that there is a workmanship deficiency that would be corrected by the installation of the second battery. Consequently, he has not shown any actual damages that would be cured by the provision of a second battery.

Mr. Hadfield argues that ROC is being too restrictive, but ROC is required to follow the applicable statutes and case-law, which limit recovery fund payouts.

ROC’s determination that Mr. Hadfield is entitled to a payout of $426.64 should be affirmed and Mr. Hadfield’s request for an additional $8750.00 should be denied.

RECOMMENDED ORDER

IT IS ORDERED that ROC’s Notice of Claim for Administrative Award is affirmed and that Raymond Hadfield’s request for an additional payout of $8750.00 is denied.

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.

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-137160-45720000Done this day, June 23, 2020.

/s/ Thomas Shedden

Thomas Shedden

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors

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-137160-45720000