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(1) (a) Claims will be accepted only against registered contractors.
(b) For owner claims, employee claims, contractor claims, subcontractor claims and testing claims the person against whom the claim is filed will be considered registered if that person was registered during all or part of the work period.
(c) For material claims, the person against whom the claim is filed will be considered registered if one or more invoices or payroll records involve material delivered while the person was registered. Damages will be awarded only for material delivered within the period of registration, and when filed by registered contractors.
(d) If a claim is a contractor claim or a subcontractor claim, the claimant must have been registered at the time the bid was made or the contract was entered and continuously throughout the work period before the claim will be accepted. The registration requirement for claimants does not apply to persons who are exempt from registration under Section 5-65-2(7).
(2) Claims submitted to the Commission shall be deemed to have been filed when a statement of claim, in compliance with Regulation 4.1(1) and (2), is received by the Commission. Claims will be accepted only when a direct contractual relationship, an employment relationship, or an assigned relationship exists between claimant and registrant.
(4) Claims will be accepted only for work performed within the boundaries of the State of Rhode Island or for materials or equipment supplied or rented for fabrication into or use upon structures located within the boundaries of the State of Rhode Island.
(5) The Commission may refuse to accept a claim if the facts and issues of the claim are the same as those in a claim previously filed by the same claimant and disposed, unless it regards a repair ordered by the Board, in which case the claimant has one year from the time of the repair in which to file a statement of claim.
(1) Homeowner for negligent and improper work.
(2) Homeowner for breach of contract.
(3) Homeowner when mechanics lien is filed.
(4) Contractor against a subcontractor.
(5) Subcontractor against a Contractor.
(6) Employee for unpaid wages.
(7) Soil, asphalt or concrete testing: labor or material.
(8) Material and/or equipment supplier.
4.2 Commission requirements for acceptable claims.
(1) For claim types 4.1(1) through 4.1(6) and 4.1(7) labor: The Commission will accept claims only against persons registered during the "work period". That is, the time that a contract, written or oral, was entered into until the work ceased or was substantially completed.
(2) For claim types 4.1(4) and (5) it is also required that the claimant be registered at the time the bid was made or when the contract was entered into and remain registered throughout the "work period".
(3) For claim type 4.1(6) the "employee" claimant is exempt from the registration requirement in accordance with RI General Law 5-65-2(7).
(4) For claim types 4.1(7) and (8) material/equipment the person against whom the claim is filed is considered registered if any invoices or payroll records involve material deliveries or equipment rentals while that person was registered. Damages assessed will be considered only for those items delivered or rented during the period of registration.
(5) Claims must be submitted in the format specified by the Commission and on the claim forms provided by the Commission (see claim form guidelines in Section 4.3).
(6) The claimant and the registrant must have either a direct contractual, an employment, or an assigned relationship.
(7) All labor, materials, or equipment supplied or rented must be performed, fabricated into, or used on structures located within the State of Rhode Island.
4.2.1 Claim Forms
(1) Claims shall be submitted on Statement of Claim forms provided by the Commission. The Commission may require the use of the most recent revision of the Statement of Claim Form.
(2) The claimant shall submit the following information if available:
(a) The name, address, and telephone number of the claimant;
(b) The name, address, telephone number, and registration number of the registrant;
(c) The amount claimant alleges to be due from the registrant after crediting payments, offsets, and counter claims in favor of the registrant to which claimant agrees;
(d) Identification of the type of claim;
(e) The date on which the contract was entered into; if the contract was in writing, a copy of the contract shall be attached to the Statement of Claim;
(f) Job location;
(g) The beginning and ending date of the work or invoices;
(h) Payments, offsets, and counter claims of the contractor, if known;
(i) A certification by the claimant that the Statement of Claim is true;
(j) Copies of any adjudication by a court or by binding arbitration;
(k) Subcontractor claims and material claims shall be accompanied by copies of each original invoice relating to the claim and a recapitulation showing the date, number, amount and description for each invoice submitted.
(L) Employee claims shall be accompanied, if possible, by copies of time cards or other evidence of time worked.
(m) Mechanics lien claims shall be accompanied by evidence that the claimant has paid the contractor, a copy of the notice of right to lien, a copy of the lien bearing the city or town recorders stamp and signature.
(n) Material claims shall be accompanied by recapitulation of the indebtedness showing the job site address, the date of each invoice, each invoice number, and each invoice amount.
4.3 Claim for guidelines and sample forms (CRB 2-98 and 3-95):
(1) For claim types 4.1(1) through 4.1(6) and 4.1(7) labor only use Commission form CRB 2-98.
(2) For claim types 4.1(7) and (8) material and equipment only use Commission form CRB 3-95.
(3) Claimants are required to provide all available information requested by the Commission. Said information shall include, but not be limited to; that information outlined on forms CRB 2-98 and 3-95.
(4) Claimants are required to provide copies of all available supporting documentation required by the Commission. Said documentation shall include, but not limited to:
(a) Written contract and agreements,
(b) Invoices,
(c) Billings,
(d) Estimates,
(e) Receipts,
(f) Canceled checks,
(g) Time cards or other payroll data,
(h) Court Adjudication or binding arbitration data,
(i) Notices of counter claims by registrants.
(5) Mechanic lien claimants are required to provide copies of all available data required by the Commission. Said data shall include, but not limited to:
(a) Evidence that the claimant has paid the contractor,
(b) Notice of right to lien,
(c) Lien copy bearing the city or town Recorder's stamp and signature,
(d) All invoices, billings and other accounting data used as a basis for the lien,
(e) Any foreclosure data.
(6) Whenever the claimant fails to respond to the Commission's requests for information and documentation within the time period specified by the Commission, the Commission may close the claim file without notice.
4.4 Commission procedures for processing claims:
(1) In determining the acceptability for a claim, the Commission shall determine whether it falls within the parameters outlined in Rhode Island General Law 5-65 as to scope, Commission jurisdiction and damages.
(2) The Commission will provide a copy of all claims filed to the person(s) against whom the claim is filed.
(3) The Commission reserves the right to inspect the property subject to the claim. If the claimant refuses access, the Commission may dismiss the claim permanently.
(4) When an owner claim is received by the Commission while the Commission is processing a contractor/sub contractor claim involving the same property, both claims will be processed together.
(5) When the Commission determines that a registrant, against whom a claim has been filed, has breached a contract or performed negligent work; the Commission may recommend a resolution consistent with the terms of the contract or with generally accepted building and industry standards.
(6) The Commission may propose a settlement to resolve any claim. If the parties involved sign a settlement agreement put forth by the Commission, the agreement shall be binding unless breached by either party. The commission may close the file without notifying the claimant whenever:
(a)The claimant notifies the Commission that the terms of the settlement agreement has been fulfilled.
(b)The claimant fails to notify the Commission in writing, and within thirty (30) days of the agreed upon completion date shown in the settlement that the terms have not been fulfilled.
(7) The claimant may seek monetary damages whenever:
(a)The claim has not been disposed and/or dismissed,
(b)The claimant or the person(s) against whom the claim is filed does not agree with the settlement proposed by the Commission,
(c)The person(s) against whom the claim is filed does not fulfill the terms of the settlement agreements through no fault of the claimant and the claimant notifies the Commission in writing within thirty (30) days of the agreed upon completion date.
(8) Whenever the Commission determines that monetary damages may be considered in lieu of other remedies to resolve a claim, the claimant:
(a)Shall submit substantiating evidence to support the amount alleged to be due,
(b)Shall seek payment for only those items shown on the statement of claim form,
(c)May be required to submit an estimate for the cost of correction for the items shown on the statement of claim form. Said estimate must be obtained from a registrant.
(9) To resolve a claim involving monetary damage the Commission may:
(a)Issue a notice of hearing to parties to give the opportunity for a hearing,
(b)Set an Administrative hearing to mediate the facts of the claim and the amount alleged due.
(10) The Commission shall not issue an order for damages in an amount greater than the amount claimed due at the hearing.
(11) No monetary award shall be made for attorney fees, interest, or other Administrative costs, except as provided for; in Section 4.8 (mechanic lien claims), by court order or by specific written contract language.
(12) Administrative hearings may be held before a hearing officer of the Commission. The claimant must prove that damages have occurred and that those damages have been caused by the registrant, and the monetary value of those damages. If the claimant fails to carry this burden of proof, the Commission will dismiss the claim.
(13) If the claimant, after being properly served notice f the hearing in accordance with these rules, fails to appear at a hearing, the Commission will dismiss the claim, unless it finds that failure to appear was caused by circumstances outside the control of the claimant.
(14) If the registrant, after being properly served notice of a hearing in accordance with these rules, fails to appear at a hearing, the Commission will issue a default order based upon the claimants representation of a prima facie case. The only exceptions will be those situations in which the registrants failure to appear was caused by circumstances outside the registrants control. At the discretion of the Executive Director, if cause is beyond the control of the registrant, a new Administrative hearing may be schedule.
(15) Claimant or registrant may challenge and offer evidence to disprove the Commissions investigative report, if any, at an Administrative hearing.
(16) Based upon evidence received at the hearing, the hearing officer will prepare findings of fact and conclusions, will issue a proposed order. The proposed order may order the registrant to pay monetary damages to the claimant, send the contractor back to repair, order a combination of monetary damages and repair work, or dismiss the claim. The Commission may consider any amounts due and unpaid to the registrant from the claimant under the terms of the contact and may reduce any proposed award by that amount.
(17) The record of the Commission hearings will include a tape recording of the proceeding. Tape recordings more than thirty (30) days beyond the end of the 30 day appeal period, following the issuance of the Commissions final order will be discarded, except when the petition for judicial review to the Court of Appeals has been timely filed. Any additional cost incurred due to service or processing of the final order will be the responsibility of the registrant or party found at fault.
(18) Final orders issued may reflect a monetary award if the proposed order was not fulfilled.
(19) Throughout the processing of a claim, the claimant has the responsibility to pursue the claim and to respond in a timely manner to requests from the Commission for information or documentation. Failure of a claimant to respond to correspondence from the Commission, or to provide requested information or documentation within a time frame specified in that correspondence or request, may result in closure of the claim file by the Commission without further notice to the claimant.
(20) Estimates are required prior to an Administrative hearing or at the hearing to be used as the basis for a monetary award. All estimates must be from registered contractors, if work to be conducted requires a registration. Criminal prosecution of violations of final orders may not result where estimates are not submitted at an Administrative hearing. A monetary award may be determined by the hearing officer from the contract balance or for repair work at the hearing officers discretion, based on his/her expertise.
4.5 The Commissions right to refuse and/or dismiss claims:
(1) The Commission may, under the authority of 5-65-2(4), discontinue processing a claim whenever it determines that the issued involved are more suited to adjudication by a court. The Commission may resume processing the claim if:
(a) The claimant had delivered a copy of the final judgement rendered by the court within 30 days of that action. The Board may then act on the contractors registration, after providing notice and opportunity for a hearing. The Commission may, without notice to the claimant, close the claim file whenever the claimant fails to comply with the requirements of this section. A claim file closed as set forth in this section shall not be reopened.
(2) The Commission may, under the authority of 5-65-12(b) discontinue processing a claim and dispose the claim file, whenever it is determined that either party has submitted the case to a court, arbitration, or other entity authorized by law to effect a resolution.
(3) The Commission may resume processing a claim which has been previously discontinued due to the fact that it was submitted to a court, arbitrator or other entity if:
(a) The claimant submits copies of all final decisions or judgements rendered by the court or other entity together with the complaint or other pleadings used in the case. Said data must be submitted within 30 days of the final action. The Board may then act on the contractors registration after having provided notice and opportunity for a hearing. The claimant or respondent shall provide the Commission with a copy of the filed civil complaint.
(4) To resume processing the claim, the Commission shall accept a judgement of a court of competent jurisdiction or a decision of another entity as the final determination of the merits of the claim.
(5) If at any time during the processing of the claim, prior to issuance of an order, the Commission finds that the issues involved in the claim have been submitted to a court for determination, (excepting a petition to enforce pursuant to G.L. 34-28-10) or to arbitration, or to any entity authorized by law or the parties to effect a resolution, it may discontinue processing the claim.
(6) Whenever the Commission determines that the value of the damages due the claimant is less than that owed the registrant under the terms of the contract, the Commission may dismiss the claim.
(7) If at any time during the processing of the claim, the claimant accepts a valid promissory note from the registrant as settlement of the claim, the Commission will dismiss the claim. The Commission will consider that the claimant, by accepting a valid promissory note, has chosen another forum for resolution of the claim. Dismissal of the claim will be final, and the claim will not be reopened.
(8) If at any time during the processing of the claim the Commission finds that the nature or complexity of the issues are such that a court would be a more appropriate forum for adjudication, it may discontinue processing the claim.
(9) If either party refuses to sign a waiver to give up their right to a trial by jury at the Administrative Hearing, no monetary damages will be awarded. Fines and action on a contractors registration may be imposed.
(10) The Commission reserves the right to escrow funds for either party, and hold until it is determined, to the Boards satisfaction, that there is a resolution to the claim in dispute. The Commission may refuse to accept a claim if the facts and issues of the claim are the same as those in a claim previously filed and subsequently disposed.
4.6 Contracts with Arbitration Agreements
(1) If a claim is received which is based upon a contract which contains an agreement by the parties to arbitrate disputes arising out of the contract, the specific terms of the arbitration agreement supersede Commission regulations. The Commission will take the following action:
(a) Inform the claimant that the Commission will accept the claim for processing only if both parties agree to waive arbitration. The necessary waiver must be written, signed, and received by the Commission within 30 days (or within the time period specified in the contract for the commencement of arbitration, whichever is later) of the date the Commission notifies the parties that a waiver is required. Such notice shall be made by mail.
(b) If the Commission receives no waiver from the claimant, the claim will be closed and will not be reopened.
(c) If the contractor does not waive arbitration as set forth in the contract, the Commission will allow the contractor the remaining time to commence arbitration. If the contractor fails to submit evidence to the Commission that arbitration has been commenced within the 30 days or the time period specified by the contract (which ever is later), the Commission will resume processing the claim.
(d) If arbitration is commenced, in accordance with the Rhode Island Public Works Arbitration Act, RI G.L. 37-161-1 et seq., then it shall be binding upon the participants. The contractor shall submit evidence substantiating this within the period referred to in subsection (1)(C) of this regulation and the Commission will discontinue processing the claim until the arbitration is completed. Neither party can file a claim for damages with the Board after going through arbitration. A claim may be filed to act on the contractors registration status within 30 days of the date of final action by the arbitrator, delivers to the Commission a copy of the arbitration award or decision.
4.7 Court Judgements
(1) A court judgement may constitute the basis for action on a registration in the following situations:
(a) A claimant initiated litigation against the contractor, and the litigation resulted in a judgement in favor of the claimant.
(b) A claimant has filed a claim which the Commission ceased processing because of its nature and complexity, the claimant pursued the matter through the courts, and the litigation resulted in a judgement in favor of the claimant.
(2) Upon receipt of a timely filed judgment, the Commission will take the following actions:
(a) Issue a notice of hearing and schedule an Administrative hearing.
4.8 Mechanics Lien Claims
(1) Upon acceptance of a claim, the Commission shall send a copy of the claim to the contractor and shall initiate an investigation to determine the validity of the claim.
(a)Investigation by the Commission will include:
(A) A determination of whether the claimant paid the contractor for work performed or materials supplied or equipment rented subject to Chapter 565 and whether the contractor failed to pay the subcontractor, or material or equipment supplier, thereby causing a lien to be filed against the claimants property; and
(B) A determination of whether the lienor filed the lien with the recording officer of the city or town.
(b)If the contractor contends that payment has been made to the lienor, either directly or by the return of goods constituting a credit to the registrants account, the contractor may subpoena the lienor and pertinent records to any hearing held by the Commission.
(c)If at any time prior to the issuance of a final order the Commission determines that the lien is unenforceable or invalid, the Commission may proceed with the determination of the claim.
(2) Claims may include attorney fees, court costs, interest and/or service charges if these items are included as part of the mechanics lien or incurred as costs in discharging the lien. Awards to owners for costs in discharging the lien shall not exceed the amount of the lien.
(3) The Commission may reduce the amount awarded to the claimant by:
(a) Any amount the claimant owes the contractor,
(b) Any amount included for tools or equipment not fabricated into the structure.
(4) If a claimant files two or more claims against a contractor relating to work performed under the same contract(s) and if the claimant has not paid the contractor the full amount of the contract, the amount awarded on each claim will be reduced on a pro rated basis. No proposed or final order shall be issued on any claim until all claims involving the two parties filed within the same 90 day period are ready for such order.
(5) If a suit is filed to enforce a lien that is the subject of a claim, the Commission shall send notice to the claimant that:
(a) The claimant has the right to request a stay of the proceedings until the Commissions processing of the claim is complete.
(b) The Commission will hold the claim open for 60 days from the date of the notice to allow the claimant to obtain a stay.
(c) The Commission will close the claim if evidence is not received within 60 days from the date of the notice that a stay has been obtained.
(d) Upon timely receipt of evidence that a stay has been obtained, the Commission will resume processing the claim.
(6) If a mechanics lien claim involves the same facts and issues as any other open claim, the Commission shall process the claims together.
(7) If the Commission awards monetary damages to the owner to discharge a lien, the Commission may reduce the amount awarded related claims by the amount of the award in the mechanic lien claim.
4.9 Exceptions to Commission Orders
(1) Claimant or contractor may file written exceptions if they believe that the Commission has made a procedural error or that the proposed order is not supported by evidence received at the hearing or for any other reason. To be considered, exceptions must be received by the Commission within 20 days of the date of mailing of the proposed order, accompanied by a non-refundable $20.00 processing fee. If written exceptions are not timely received, the Commission may issue a final order.
(2) If exceptions are timely received, the matter will be set for consideration by the members of the Board at their next regular meeting for which agenda space is available. Copies of exceptions filed will be mailed to the other side who may respond to the exceptions. Response and any written argument for or against the proposed order will be accepted up to the Board meeting date if the original exceptions were timely received.
(3) Claimant and registrant, and/or their attorney(s), may appear before the members of the Board to argue for or against the proposed order. Oral argument will be permitted only if the original exceptions were timely received.
(4) At the meeting of the members of the Board, the Board will consider evidence received at the hearing and exceptions and written or oral argument for or against the proposed order, but the Board will not consider new or additional evidence. Time allowed for oral argument before the members of the Board may be limited to ten minutes for each side.
(5) The members of the Board may affirm the proposed order and findings of fact, modify either or both, or send the case back to a new hearing. Unless the case is sent back to a new hearing, the Commission will issue a final order after the Board meeting.
(6) Final orders, which have been appealed, are subject to judicial review as set forth in the Administrative Procedures Act, Chapter 42 35 of the General Laws.
(7) The Board will also hear motions to vacate or other motions as long as relative to RI General Law 5-65 et el.