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LeMaster Appeals Court Decision

LeMaster Appeals Court Decision

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Published by whistleblowermn
Minnesota Court of Appeals ruling in LeMaster Restoration case
Minnesota Court of Appeals ruling in LeMaster Restoration case

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Published by: whistleblowermn on Jun 22, 2011
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06/22/2011

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This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2010).
STATE OF MINNESOTAIN COURT OF APPEALSA10-1700
In the Matter of the Residential BuildingContractor License of LeMaster Restoration, Inc.,f/k/a LeMaster Construction, Inc. andin the Matter of the Residential Building ContractorLicense of LeMaster Restoration, Inc.,and Verdean LeMaster, Individually.
Filed June 20, 2011AffirmedConnolly, Judge
Minnesota Department of Labor and IndustryOAH Docket No. 3-1902-20840-2Marshall H. Tanick, Mansfield, Tanick & Cohen, P.A., Minneapolis, Minnesota (forrelators)Lori A. Swanson, Attorney General, Christopher M. Kaisershot, Assistant AttorneyGeneral, St. Paul, Minnesota (for respondent)Considered and decided by Toussaint, Presiding Judge; Connolly, Judge; andStauber, Judge.
U N P U B L I S H E D O P I N I O NCONNOLLY
, JudgeRelators, a construction company and its principal, challenge the denial of theirmotions for a continuance of an administrative hearing, the subsequent revocation of their
contractor’s
building license, and the imposition of penalties for their violations. Because
 
2the denial of the continuance was not arbitrary or capricious, the determinationssupporting the revocation were not erroneous, and the penalties were not an abuse of discretion, we affirm.
FACTS
In July 2009, respondent Department of Labor and Industry (DLI) issued twoorders concerning relators LeMaster Restoration, Inc. (LRI), and its principal, VerdeanLeMaster (LeMaster).
1
 
The first order concerned relators’
misconduct prior toDecember 1, 2007 (pre-December 2007 violations); it set a prehearing conference forSeptember 10, 2009. The second order concerned relators
’ misconduct afte
r December 1,2007 (post-December 2007 violations)
; it revoked relators’ license, imposed a $20,000
civil penalty, and ordered relators not to act or hold themselves out as licensedresidential-building contractors.
On August 26, 2009, relators’ attorney
requested a hearing on the order imposingdiscipline for post-December 2007 violations. The hearing on those violations was alsoscheduled for September 10, 2009. At that hearing, the administrative-law judge (ALJ)consolidated the two actions and scheduled a hearing for January 10, 2010.
1
DLI issued two orders because of a December 2007 change in the relevant law. Minn.Stat. §§ 326.93-.992 (2006) concerned violations committed prior to November 30, 2007.It provided that DLI had to commence an administrative action before the commissionercould impose any discipline on residential-building contractors, even if the discipline wasnot challenged, and permitted judicial review of disciplinary acts by parties who did notappear at the hearing. Minn. Stat. § 326B.082 (Supp. 2007) concerned violationscommitted after December 1, 2007. It provided that the commissioner could imposediscipline prior to a hearing and gave disciplined parties 30 days to request a hearing,after which the unchallenged discipline became final with no right to judicial review.
 
3The consolidated action was later amended to include further allegations of 
relators’ misconduct after December 1, 2007, and stated that this misconduct could result
in additional disciplinary action beyond that specified in the July 2009 order.DLI moved for partial summary judgment on the ground of collateral estoppel as
to relators’ violations adjudicated in
LeMaster Constr., Inc. v. Woeste
, No. A08-0956,2009 WL 1048194 (Minn. App. Apr. 21, 2009) (affirming a $301,302.72 judgmentagainst relators in favor of homeowners) (
Woeste
).
2
The motion was granted.
On December 29, 2009, relators’ attorney withdrew from representation. Relators
requested a continuance of the January 20 hearing so they could retain new counsel. TheALJ rescheduled the hearing for March 18.
During January 2010, DLI summarily suspended LRI’s license pending thecommissioner’s final order and learned that relators were conducting business without a
license from a customer who had recently paid them $70,000. To stop this practice, DLI
issued a subpoena for relators’ existing contracts and for an accountin
g of money for eachcontract. Relators did not comply with the subpoena.On March 12, 2010, relators again moved for a continuance. The ALJ denied themotion. On March 17, 2010, relators submitted a third request for a continuance, andLeMaster submitted an affidavit in lieu of appearing at the hearing. The ALJ denied therequest and did not accept the affidavit.
2
Relators paid the judgment affirmed in
Woeste
in August 2009.

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