ALJDEC decisions subject to certification as final

2022A-04032-RFA-LS-ROC · Registrar of Contractors · 2024-09-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Van Thi Tran,

COMPLAINANT

L H C Construction Inc.

License No. ROC 173191,

RESPONDENT

No. 2022A-04032-RFA-LS-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 15, 2024

APPEARANCES: Complainant Van Thi Tran appeared via Google Meet on her own behalf. The Registrar of Contractors was represented by Assistant Attorney General Charles Hover III, who appeared via Google Meet.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

EXHIBITS ADMITTED INTO EVIDENCE: Complainant’s Exhibits A-H, and Respondent’s Exhibits 1-21 were admitted into evidence.

_____________________________________________________________________

FINDINGS OF FACT

Background and Procedure

On or about March 22, 2023, the Registrar issued a Final Administrative Decision and Order in Docket Nos. 2022A-04032-CHC-ROC and 2022A-04007-CHC-ROC, wherein it disciplined Respondent’s license resulting from workmanship issues.

On or about June 21, 2023, Complainant filed a claim with the Residential Contractors’ Recovery Fund (Fund) to recover the cost of the faulty work.

On or about April 18, 2024, the Registrar issued a Notice of Claim for Administrative Payout, finding that Complainant was not entitled to a payout as there were no compensable actual damages.

Complainant requested a hearing. The Registrar referred the matter to the Office of Administrative Hearings (OAH) for an evidentiary hearing.

Hearing was held on August 14, 2023.

Hearing Evidence

Katelyn Rolling, Legal Assistant II for the Registrar, testified that while she determined that Complainant was eligible to file a recovery fund claim, she was not entitled to receive a payout from the same as the unpaid balance on her contract exceeded the costs to repair her project.

Ms. Rolling testified that there was an initial contract in the amount of $493,526.00. There was also a change order in the amount of $7,801.00 for additional upgrades. Thus, the total contract price was $501,327.00.

Next, Ms. Rolling testified that she reviewed the payment information supplied by Complainant, and determined that Complainant made a total of $437,157.00 in payments to Respondent.

Ms. Rolling then testified that she reviewed the two repair bids supplied by Complainant. The first was a bid from Xact Masonry in the amount of $50,000.00, and the second bid was from 928 Steel in the amount of $9,563.48. Ms. Rolling testified therefore, that the total cost to repair the project was $59,563.48.

Further, Ms. Rolling testified that because the outstanding balance owed to Respondent ($64,170.00) was greater than the costs to repair ($59,563.48), there were no compensable actual damages.

Finally, Ms. Rolling testified that she provided her analysis based upon the information that Complainant provided in her filing and prior to the denial notice. Ms. Rolling testified that there was no evidence that the $29,000.00 allocated for the swimming pool had been deducted from the contract, therefore the total contract price, plus the change order, must be paid in full to grant recovery.

Complainant testified that she never had the swimming pool constructed and therefore did not pay the additional $29,000.00, and as such she then would qualify for reimbursement. Complainant testified further that there was no change order or anything in writing cancelling the pool work, and would have provided something in writing if Ms. Rolling would have required the same.

CONCLUSIONS OF LAW

This matter lies within the Registrar’s jurisdiction.

A.R.S. § 32-1132.01(B)(1) provides that “[a]n award from the residential contractors’ recovery fund may not exceed the actual damages suffered by the claimant as a direct result of a contractor’s violation. Actual damages: 1. May not exceed an amount necessary to complete or repair a residential structure or appurtenance within residential property lines.”

Complainant 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.”

The tribunal finds that Complainant did not have the pool constructed and that to count that portion into the unpaid balance would be unjust to Complainant, especially if she paid for the other work for which she was now seeking reimbursement. Therefore, the tribunal finds that Complainant is entitled to a Recovery Fund payout in the amount of $24,393.48 and provides the following calculation:

$501,327.00 (total contract price) - $29,000.00 (swimming pool portion) - $437,157.00 (amount Complainant paid) = $35,170.00 (unpaid balance).

$59,563.48 (cost to repair) - $35,170.00 (unpaid balance) = $24,393.48.

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the Registrar’s final order, Complainant receive a payout from the Residential Contractors’ Recovery Fund in the amount of $24,393.48.

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 forty (40) days from the date of that certification.

-54864001

001

-137160-45720000Done this day, September 3, 2024.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Tom Cole, Director

Registrar of Contractors

Van Thi Tran

[email redacted]

L H C Construction Inc.

[email redacted]

Charles Hover III

[email redacted]

By: OAH Staff