COURT OF APPEALS OF VIRGINIA
Present: Judges Bray, Annunziata and Overton
HERBERT W. LUX, JR.
v. Record No. 0366-97-2 MEMORANDUM OPINION *
PER CURIAM
JACK KOTVAS, DIRECTOR, JULY 8, 1997
DEPARTMENT OF PROFESSIONAL
AND OCCUPATIONAL REGULATION
FROM THE CIRCUIT COURT OF SPOTSYLVANIA COUNTY
William H. Ledbetter, Jr., Judge
(Herbert W. Lux, Jr., pro se, on brief).
(James S. Gilmore, III, Attorney General;
John B. Purcell, Jr., Assistant Attorney
General, on brief), for appellee.
Herbert W. Lux appeals the decision of the circuit court
affirming the decision of the Department of Professional and
Occupational Regulation (Department), Board for Contractors
(Board) to pay a claim pursuant to the Contractor Transaction
Recovery Act (Act). Code §§ 54.1-1118 through 54.1-1127. Upon
reviewing the record and briefs of the parties, we conclude that
this appeal is without merit. Accordingly, we summarily affirm
the decision of the trial court. Rule 5A:27.
Standard of Review
Under the Virginia Administrative Process Act, Code
§§ 9-6.14:1 through 9-6.14:25, the burden is on the party
complaining of the Board's action to demonstrate an error of law
*
Pursuant to Code § 17-116.010 this opinion is not
designated for publication.
subject to review. Code § 9-6.14:17; Johnston-Willis, Ltd. v.
Kenley, 6 Va. App. 231, 241, 369 S.E.2d 1, 6 (1988). We will
review the facts in the light most favorable to sustaining the
Board's action, with due consideration of "the presumption of
official regularity, the experience and specialized competence of
the [Board], and the purposes of the basic law under which the
[Board] has acted." Code § 9-6.14:17. See also Bio-Medical
Applications of Arlington, Inc. v. Kenley, 4 Va. App. 414, 427,
358 S.E.2d 722, 727 (1987).
Facts
Viewed in the light most favorable to sustaining the Board's
decision, the record proves that in April of 1989, William and
Delores Owens entered into a contract with Lux, a licensed
contractor, for the construction of a residence. On January 12,
1994, Lux was convicted of grand larceny by false pretenses and
"grand larceny-mechanic's lien fraud" concerning the Owens'
contract. As part of his sentence, the trial court ordered Lux
to pay the Owens restitution of $2,500. On September 2, 1994,
when Lux failed to pay the restitution, the Owens filed a claim
with the Board under the Act.
The Board's Recovery Fund Committee (Committee) recommended
that the Board approve the Owens' claim. On April 10, 1996, the
Board authorized payment of the claim. Lux appealed the Board's
decision to the circuit court, and the circuit court affirmed the
Board's decision.
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Timeliness of Filing of Claim Issue
Lux first contends that the Owens did not comply with the
requirements of the Act by failing to file a verified claim
within the mandatory period of six months. Code § 54.1-1120(3).
Code § 54.1-1120, in effect at the applicable time,
provided, in pertinent part:
Whenever any person is awarded a
judgment in a court of competent jurisdiction
in the Commonwealth of Virginia against any
individual or entity which involves improper
or dishonest conduct occurring (i) during a
period when such individual or entity was a
regulant and (ii) in connection with a
transaction involving contracting, the
claimant may file a verified claim with the
Director [of the Department of Professional
and Occupational Regulation] to obtain a
directive ordering payment from the fund of
the amount unpaid upon the judgment subject,
to the following conditions:
* * * * * * *
3. A verified claim shall be filed with the
Director no later than six months after the
judgment became final.
The sentencing order requiring the payment of restitution
was entered on March 23, 1994. The Owens filed their initial
Contractor Recovery Act claim on September 2, 1994, within six
months after the judgment became final. Although the Board twice
requested additional information from the Owens, the record
indicates that the Board did not question the timeliness of the
filing of the claim, but merely requested information to
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supplement the claim. Therefore, the record indicates that the
claim was filed in compliance with the statutory requirement.
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Bankruptcy Issue
Lux next complains that the Board's decision to pay the
Owens' claim was invalid because the restitution order was void.
Lux contends that the restitution order was void because his
debt to the Owens was discharged when he filed for bankruptcy.
However, nothing in the Act precluded the payment of a claim from
the fund where a claimant's unpaid judgment against a contractor
was uncollectible because the contractor declared bankruptcy.
Moreover, 11 U.S.C. § 523(a)(4) prevents a discharge in
bankruptcy for "fraud or defalcation while acting in a fiduciary
capacity, embezzlement, or larceny." Therefore, Lux's argument
is without merit.
Code § 54.1-1120(6) Issue
Lux contends that the Board erroneously issued the directive
ordering payment from the fund because the Owens' claim did not
comply with the requirements listed in Code § 54.1-1120(6)(a)
through Code § 54.1-1120(6)(d). Code § 54.1-1120(6)(a) provides
that the verified claim must contain a statement that the
claimant has "conducted debtor's interrogatories to determine
whether the judgment debtor has any assets which may be sold or
applied in satisfaction of the judgment." The other requirements
listed in Code § 54.1-1120(6)(b) through Code § 54.1-1120(6)(d)
concern additional information about the debtor's assets.
However, Lux had filed for bankruptcy prior to December 23, 1994,
when he amended his debtor schedule listing the Owens as
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creditors. The record contains a copy of this amended debtor
schedule. Therefore, the Board was aware of Lux's bankruptcy
filing.
Further, on September 15, 1994, the Department sent the
Owens a form letter which contained a list of the types of
information typically requested by the Department concerning
claims. The form had a line for each item on which an "X" was
placed to indicate which items of information the Department
requested from the Owens. In this letter, the Department placed
on "X" on the line indicating a request for a copy of the
bankruptcy notice. The form did not contain an "X" on the lines
indicating requests for information concerning debtor's
interrogatories. Thus, in light of Lux's bankruptcy filing, it
was not necessary to provide the Department information regarding
debtor's interrogatories. Therefore, this argument is without
merit.
Notification and Continuance Issues
Whether to grant Lux's request for a continuance was within
the discretion of the Board. Cf. GTE Sprint Communications Corp.
of Virginia v. AT & T Communications of Virginia, Inc., et al.,
230 Va. 295, 306, 337 S.E.2d 702, 709 (1985) (addressing the
denial of a request for a continuance of a hearing conducted by
the State Corporation Commission).
The record indicates that the Committee scheduled a hearing
for the Owens' claim for March 18, 1996. On March 7, 1996, Holly
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Erickson, Assistant Administrator for the Recovery Fund, sent a
letter to Lux informing Lux of the scheduled hearing. On March
14, 1996, Lux telephoned Erickson and requested a deferral in
order to prepare for the hearing. On that same date, Lux sent a
letter to Erickson requesting a continuance because his wife had
grand jury duty on March 18, 1996 and he had to "watch" their
daughter on that date. However, the Committee considered and
approved the Owens' claim on March 18, 1996.
On March 22, 1996, Erickson sent a letter to Lux advising
him that the Committee recommended payment of the Owens' claim.
Erickson also informed Lux that the Board would meet on April 10,
1996 to ratify the Committee's decision. Lux responded by letter
dated March 27, 1996, stating that he intended to be present at
the April 10, 1996 meeting and that he planned to address the
Board. On April 3, 1996, Lux asked for a continuance because he
had to attend a court hearing on that date. The Board met on
April 10, denied his request for a continuance, and approved the
Owens' claim.
Clearly, Lux was given adequate notice of each step in the
process and was given the opportunity to be heard at each
proceeding. Nothing in the record indicates that the Committee
or the Board abused its discretion in denying Lux's requests for
continuances and in conducting the hearings as scheduled.
Further, Lux argues that he did not receive notice of the
Board's decision to pay the Owens' claim. However, the agency
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record contains the April 11, 1996 letter to the Owens from
Erickson informing the Owens that their claim was approved. In
addition, Code § 54.1-1122 provides that when the Board issues a
directive ordering payment from the fund to the claimant, then
"[t]he claimant shall be notified in writing of the findings of
the Board." There is no statutory requirement that the regulant
must be notified of the payment. Therefore, this argument is
without merit.
Final Order Issue
Lux contends that the Board erred in making
payment of the Owens' claim without entering
a final order or case decision pursuant to
Code § 9-6.14:14. However, the record does
not indicate that this argument was presented
to the trial court. The trial court's
November 13, 1996 opinion letter does not
address this issue. Further, Lux's written
statement of facts was filed more than fifty-
five days after entry of the final order and
is not part of the record on appeal. See
Rule 5A:8(c)(1). In addition, Lux filed no
transcript of the proceeding before the trial
court. Therefore, we are unable to determine
whether this argument was presented to the
trial court. We have many times pointed out
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that on appeal the judgment of the lower
court is presumed to be correct and the
burden is on the appellant to present to us a
sufficient record from which we can determine
whether the lower court has erred in the
respect complained of. If the appellant
fails to do this, the judgment will be
affirmed.
Justis v. Young, 202 Va. 631, 632, 119 S.E.2d 255, 256-57 (1961).
Accordingly, Rule 5A:18 bars our consideration of this
question on appeal. Moreover, the record does not reflect any
reason to invoke the good cause or ends of justice exceptions to
Rule 5A:18.
For the reasons stated, the decision of the circuit court is
summarily affirmed.
Affirmed.
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