Arizona Registrar of Contractors

Our Recovery Fund videos are the easiest way to get information about filing a claim. The ROC Recovery Fund videos contain a wealth of information to help you through the claims process.

The Recovery Fund is a form of financial protection provided by licensed Arizona residential contractors to residential consumers.

The Recovery Fund is governed by statute and available only to owner / occupants of class three (3) residential property. A "person injured" as defined by statute, can recover losses incurred due to poor workmanship or non-performance by a licensed residential contractor.

An action against the Recovery Fund must be commenced no later than two years from the commission of the act of the contractor, the cause of the injury, or from the date of occupancy. The Recovery Fund is available to owner's of class three (3) real residential property which is actually occupied or intended to be occupied by the owner as a residence. A payment is not available if the residential contractor’s license was inactive, expired, cancelled, suspended, revoked or not issued at the time of the contract.

The homeowner can pursue the fund by way of the administrative procedure or the civil procedure.

Civil Procedure for Recovery

Civil Procedure How-to A civil action must be brought against the contractor in either Justice of the Peace Court or Superior Court. The plaintiff (claimant) must also pursue the contractor's license bond. This can be accomplished in the same action.

The claimant must notify the Registrar, of the commencement of the action, pursuant to A.R.S. §32-1136. Submit a copy of the summons and complaint, judgment and all supporting documentation for review prior to obtaining a certified order from the court directing payment from the Recovery Fund. The fund does not cover court costs or attorney's fees.

Administrative Procedure for Recovery

Administrative Procedure How-to If the contractor's license has been revoked or suspended as a result of an order to remedy a violation, you may be eligible to apply directly to the fund.

An administrative claim must be filed on forms prescribed by the Registrar and submitted to our office along with all supporting documentation. Required documentation would include a copy of the contract with the contractor, proof of payment on that contract and at least three itemized bids from licensed Arizona residential contractors as to the necessary costs to complete or repair the project.

This documentation establishes / documents the "injury" described in your claim, provides for consistency in the awarding of funds and establishes a clean audit trail. The Recovery Fund is audited every three years by a CPA.

The Recovery Fund does not guarantee payment to anyone. However, a "person injured" can recover as much as $30,000. An award is limited to actual damages (workmanship) but shall not exceed an amount necessary to complete or repair the project. The maximum payout per residential contractor's license is $200,000.

If all statutory requirements are met and all required documents are filed with the claim, an administrative payout could occur in a minimum of 16 weeks, provided a hearing is not requested or the contractor does not file bankruptcy.

Payouts on civil claims vary and are dependent upon the speed of the civil court system.

The contractor is guaranteed the right to due process under the U.S. Constitution. The first hearing was for disciplinary purposes. A Recovery Fund hearing would address different issues such as eligibility requirements or the appropriateness of the proposed monetary award.

A hearing can be requested by the contractor, homeowner or the Registrar of Contractors.

Generally an award is made based on the low bid. The Recovery Fund does not select or hire the contractor. The check is issued to the homeowner and you contract directly with the contractor. The homeowner is free to select and hire the contractor of their choice. The homeowner would be responsible for paying any difference in costs.

Since the agency licenses and regulates contractors, we can't recommend anyone to you. This could be considered a conflict of interest. You might consider not volunteering this information since you will contract directly with the contractor after receiving the award.

If you feel you need to get the work done, the decision must be made by you, the homeowner.

You will want to fully document the condition of the home with photos, etc., so that you are prepared to support your claim if a hearing is requested. Obtain at least three itemized bids from licensed Arizona residential contractors and submit them to the fund along with copies of cancelled checks as proof of payment to the new contractor.

In any case, the Recovery Fund can not guarantee payment nor can it guarantee that you will receive full reimbursement for the amounts you spend.