H.B. 62 Enrolled

LIEN RECOVERY FUND AMENDMENTS
2004 GENERAL SESSION
STATE OF UTAH
Sponsor: R. Curt Webb

LONG TITLE
General Description:
This bill modifies the Residence Lien Restriction and Lien Recovery Fund Act.
Highlighted Provisions:
This bill:
. creates a certificate of compliance to be obtained by the owner of a residence when
the owner has complied with provisions of the Residence Lien Restriction and Lien
Recovery Fund Act and is seeking protection under the Act;
. establishes the Division of Occupational and Professional Licensing as the
administrator of the certificate of compliance;
. broadens the definition of a contractor used in establishing that an owner has
complied with provisions of the Residence Lien Restriction and Lien Recovery Fund
Act and is seeking protection under the Act;
. delays judicial determination of the rights and responsibilities of an owner of a
residence in a lien proceeding until the owner has time to establish compliance with
the Residence Lien Restriction and Lien Recovery Fund Act;
. eliminates an outdated provision of the Residence Lien Restriction and Lien
Recovery Fund Act requiring a study of the Lien Recovery Fund; and
. makes technical changes.
Monies Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:

AMENDS:
38-1-11, as last amended by Chapter 198, Laws of Utah 2001
38-11-102, as last amended by Chapter 198, Laws of Utah 2001
38-11-104, as last amended by Chapter 172, Laws of Utah 1995
38-11-105, as enacted by Chapter 308, Laws of Utah 1994
38-11-106, as enacted by Chapter 308, Laws of Utah 1994
38-11-107, as last amended by Chapter 198, Laws of Utah 2001
38-11-202, as last amended by Chapter 193, Laws of Utah 1999
38-11-203, as last amended by Chapter 276, Laws of Utah 2003
38-11-204, as last amended by Chapter 198, Laws of Utah 2001
ENACTS:
38-11-110, Utah Code Annotated 1953

Be it enacted by the Legislature of the state of Utah:
Section 1. Section 38-1-11 is amended to read:
38-1-11. Enforcement -- Time for -- Lis pendens -- Action for debt not affected --
Instructions and form affidavit.
(1) A lien claimant shall file an action to enforce the lien filed under this chapter within:
(a) 12 months from the date of final completion of the original contract not involving a
residence as defined in Section 38-11-102 ; or
(b) 180 days from the date the lien claimant last performed labor and services or last
furnished equipment or material for a residence, as defined in Section 38-11-102 .
(2) (a) Within the time period provided for filing in Subsection (1) the lien claimant shall
file for record with the county recorder of each county in which the lien is recorded a notice of the
pendency of the action, in the manner provided in actions affecting the title or right to possession
of real property, or the lien shall be void, except as to persons who have been made parties to the
action and persons having actual knowledge of the commencement of the action.
(b) The burden of proof shall be upon the lien claimant and those claiming under him to

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show actual knowledge.
(3) This section may not be interpreted to impair or affect the right of any person to
whom a debt may be due for any work done or materials furnished to maintain a personal action
to recover the same.
(4) (a) If a lien claimant files an action to enforce a lien filed under this chapter involving
a residence, as defined in Section 38-11-102 , the lien claimant shall include with the service of the
complaint on the owner of the residence:
(i) instructions to the owner of the residence relating to the owner's rights under Title 38,
Chapter 11, Residence Lien Restriction and Lien Recovery Fund Act; and
(ii) a form affidavit [and motion for summary judgment] to enable the owner of the
residence to specify the grounds upon which the owner may exercise available rights under Title
38, Chapter 11, Residence Lien Restriction and Lien Recovery Fund Act.
[(b) The lien claimant may file a notice to submit for decision on the motion for summary
judgment. The motion may be ruled upon after the service of the summons and complaint upon
the nonpaying party, as defined in Section 38-11-102 , and the time for the nonpaying party to
respond, as provided in the Utah Rules of Civil Procedure, has elapsed.]
[(c)] (b) The instructions and form affidavit [and motion] required by Subsection (4)(a)
shall meet the requirements established by rule by the Division of Occupational and Professional
Licensing in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act.
[(d) If the nonpaying party, as defined by Section 38-11-102 , files for bankruptcy
protection and there is a bankruptcy stay in effect, the motion for summary judgment and the
action to enforce the lien shall be stayed until resolution of the related claim under Title 38,
Chapter 11, Residence Lien Restriction and Lien Recovery Fund Act.]
[(e)] (c) If a lien claimant fails to provide to the owner of the residence the instructions
and form affidavit required by Subsection (4)(a), the lien claimant shall be barred from maintaining
or enforcing the lien upon the residence.
(d) Judicial determination of the rights and liabilities of the owner of the residence under
Title 38, Chapters 1 and 11, and Title 14, Chapter 2, shall be stayed until after the owner has been

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given a reasonable period of time to establish compliance with Subsections 38-11-204 (4)(a) and
(4)(b) through an informal proceeding, as set forth in Title 63, Chapter 46b, Administrative
Procedures Act, commenced within 30 days of the owner being served summons in the
foreclosure action, at the Division of Occupational and Professional Licensing and obtain a
certificate of compliance or denial of certificate of compliance, as defined in Section 38-11-102 .
Section 2. Section 38-11-102 is amended to read:
38-11-102. Definitions.
(1) "Board" means the Residence Lien Recovery Fund Advisory Board established under
Section 38-11-104 .
(2) "Certificate of compliance" means an order issued by the director to the owner finding
that the owner is in compliance with the requirements of Subsections 38-11-204 (4)(a) and (4)(b)
and is entitled to protection under Section 38-11-107 .
[(2)] (3) "Construction on an owner-occupied residence" means designing, engineering,
constructing, altering, remodeling, improving, repairing, or maintaining a new or existing
residence.
[(3)] (4) "Department" means the Department of Commerce.
[(4)] (5) "Director" means the director of the Division of Occupational and Professional
Licensing.
[(5)] (6) "Division" means the Division of Occupational and Professional Licensing.
[(6)] (7) "Encumbered fund balance" means the aggregate amount of [all] outstanding
claims against the fund. The remainder of monies in the fund are unencumbered funds.
[(7)] (8) "Executive director" means the executive director of the Department of
Commerce.
[(8)] (9) "Factory built housing" is as defined in Section 58-56-3 .
[(9)] (10) "Factory built housing retailer" means a person that sells factory built housing
to consumers.
[(10)] (11) "Fund" means the Residence Lien Recovery Fund established under Section
38-11-201 .

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[(11)] (12) "Laborer" means a person who provides services at the site of the
construction on an owner-occupied residence as an employee of an original contractor or other
qualified beneficiary performing qualified services on the residence.
[(12)] (13) "Licensee" means any holder of a license issued under Title 58, Chapters 3a,
22, 53, and 55.
[(13)] (14) "Nonpaying party" means the original contractor, subcontractor, or real estate
developer who has failed to pay the qualified beneficiary making a claim against the fund.
[(14)] (15) "Original contractor" means a person who contracts with the owner of real
property or the owner's agent to provide services, labor, or material for the construction of an
owner-occupied residence.
[(15)] (16) "Owner" means a person who:
(a) contracts with a person who is licensed as a contractor or is exempt from licensure
under Title 58, Chapter 55, Utah Construction Trades Licensing Act, for the construction on an
owner-occupied residence upon real property owned by that person;
(b) contracts with a real estate developer to buy a residence upon completion of the
construction on the owner-occupied residence; or
(c) buys a residence from a real estate developer after completion of the construction on
the owner-occupied residence.
[(16)] (17) "Owner-occupied residence" means a residence that is, or after completion of
the construction on the residence will be, occupied by the owner or the owner's tenant or lessee as
a primary or secondary residence within 180 days from the date of the completion of the
construction on the residence.
[(17)] (18) "Qualified beneficiary" means a person who:
(a) provides qualified services;
(b) pays [all] necessary fees or [assessment] assessments required under this chapter; and
(c) registers with the division:
(i) as a licensed contractor under Subsection 38-11-301 (1) or (2), if that person seeks
recovery from the fund as a licensed contractor; or

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(ii) as a person providing qualified services other than as a licensed contractor under
Subsection 38-11-301 (3) if the person seeks recovery from the fund in a capacity other than as a
licensed contractor.
[(18)] (19) (a) "Qualified services" means the following performed in construction on an
owner-occupied residence:
(i) contractor services provided by a contractor licensed or exempt from licensure under
Title 58, Chapter 55, Utah Construction Trades Licensing Act;
(ii) architectural services provided by an architect licensed under Title 58, Chapter 3a;
(iii) engineering and land surveying services provided by a professional engineer or land
surveyor licensed or exempt from licensure under Title 58, Chapter 22;
(iv) landscape architectural services by a landscape architect licensed or exempt from
licensure under Title 58, Chapter 53;
(v) design and specification services of mechanical or other systems;
(vi) other services related to the design, drawing, surveying, specification, cost
estimation, or other like professional services;
(vii) providing materials, supplies, components, or similar products;
(viii) renting equipment or materials;
(ix) labor at the site of the construction on the owner-occupied residence; and
(x) site preparation, set up, and installation of factory built housing.
(b) "Qualified services" do not include the construction of factory built housing in the
factory.
[(19)] (20) "Real estate developer" means a person having an ownership interest in real
property who contracts with a person who is licensed as a contractor or is exempt from licensure
under Title 58, Chapter 55, Utah Construction Trades Licensing Act, for the construction of a
residence that is offered for sale to the public.
[(20)] (21) "Residence" means an improvement to real property used or occupied, to be
used or occupied as, or in conjunction with, a primary or secondary detached single-family
dwelling or multifamily dwelling up to two units, including factory built housing.

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[(21)] (22) "Subsequent owner" means a person who purchases a residence from an
owner within 180 days from the date [of the completion of] the construction on the residence is
completed.
Section 3. Section 38-11-104 is amended to read:
38-11-104. Board.
(1) There is created the Residence Lien Recovery Fund Advisory Board consisting of:
(a) three individuals licensed as a contractor who are actively engaged in construction on
owner-occupied residences;
(b) three individuals who are employed in responsible management positions with major
suppliers of materials or equipment used in the construction on owner-occupied residences; and
(c) one member from the general public who has no interest in the construction on
owner-occupied residences, or supply of materials used in the construction on owner-occupied
residences.
(2) The board shall be appointed and members shall serve their respective terms in
accordance with Section 58-1-201 .
(3) The duties and responsibilities of the board shall be to:
(a) advise the division with respect to informal adjudication of [claims] any claim for
payment from the fund [by] and any request for a certificate of compliance received by the
division;
(b) act as the presiding officer, as defined by rule, in formal adjudicative proceedings held
before the division with respect to [claims] any claim made for payment from the fund;
(c) advise the division with respect to:
(i) the general operation of the fund;
(ii) the amount and frequency of any assessment under this chapter;
(iii) the amount of any fees required under this chapter;
(iv) the availability and advisability of using funds for purchase of surety bonds to
guarantee payment to qualified beneficiaries; and
(v) the limitation on the fund balance under Section 38-11-206 ; and

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(d) review the administrative expenditures made by the division pursuant to Subsection
38-11-201 (4) and report its findings regarding those expenditures to the executive director on or
before the first Monday of December of each year.
(4) The attorney general shall render legal assistance as requested by the board.
Section 4. Section 38-11-105 is amended to read:
38-11-105. Procedures established by rule.
In compliance with Title 63, Chapter 46b, Administrative Procedures Act, the division
shall establish procedures by rule by which claims for compensation from the fund and requests
for certificates of compliance shall be adjudicated and by which assessments shall be collected.
Section 5. Section 38-11-106 is amended to read:
38-11-106. State not liable.
The state and the state's agencies, instrumentalities, and political subdivisions are not liable
for:
(1) issuance or denial of any certificate of compliance;
(2) any claims made against the fund; or [for the]
(3) failure of the fund to pay any amounts ordered by the director to be paid from the
fund.
Section 6. Section 38-11-107 is amended to read:
38-11-107. Restrictions upon maintaining a lien against residence or owner's
interest in the residence.
(1) A person qualified to file a lien upon an owner-occupied residence and the real
property associated with that residence under the provisions of Title 38, Chapter 1, Mechanics'
Liens, who provides qualified services under an agreement effective on or after January 1, 1995,
other than directly with the owner, shall be barred after January 1, 1995, from maintaining a lien
upon that residence and real property or recovering a judgment in any civil action against the
owner or the owner-occupied residence to recover monies owed for qualified services provided
by that person if:
(a) an owner meets the conditions described in Subsections 38-11-204 [(3)](4)(a) and

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[(3)] (4)(b) [are met]; or
(b) (i) a subsequent owner purchases a residence from an owner;
(ii) the subsequent owner who purchased the residence under Subsection (1)(b)(i)
occupies the residence as a primary or secondary residence within 180 days from the date of
transfer or the residence is occupied by the subsequent owner's tenant or lessee as a primary or
secondary residence within 180 days from the date of transfer; and
(iii) the owner from whom the subsequent owner purchased the residence met the
conditions described in Subsections 38-11-204 [(3)](4)(a) and [(3)] (4)(b).
(2) If a residence is constructed under conditions that do not meet all of the provisions of
Subsection (1), that residence and the real property associated with that residence as defined in
Section 38-1-4 , shall be subject to any mechanics' lien as provided in Section 38-1-3 .
(3) A lien claimant who files a mechanics' lien or foreclosure action upon an
owner-occupied residence is not liable for costs and attorneys' fees under Sections 38-1-17 and
38-1-18 or for any damages arising from a civil action related to the lien filing or foreclosure
action if the lien claimant removes the lien within [ten] 15 days from the date the owner
[establishes compliance, through written findings of fact from a court of competent jurisdiction or,
in cases where a bankruptcy has been filed, from the director, with the requirements of
Subsections 38-11-204 (3)(a) and (3)(b)] obtains a certificate of compliance and mails a copy of
the certificate of compliance by certified mail to the lien claimant at the address provided for by
Subsection 38-1-7 (2)(e). The 15-day period begins accruing from the date postmarked on the
certificate of compliance sent to the lien claimant.
Section 7. Section 38-11-110 is enacted to read:
38-11-110. Issuance of certificates of compliance.
The director shall have authority to issue or deny a certificate of compliance only after
determining through an informal proceeding, as set forth in Title 63, Chapter 46b, Administrative
Procedures Act, that the owner is in compliance with Subsections 38-11-204 (4)(a) and (4)(b).
Section 8. Section 38-11-202 is amended to read:
38-11-202. Payments to the fund.

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The Residence Lien Recovery Fund shall be supported solely from:
(1) initial and special assessments collected by the division from licensed contractors
registered as qualified beneficiaries in accordance with Subsections 38-11-301 (1) and (2) and
Section 38-11-206 ;
(2) initial and special assessments collected by the division from other qualified
beneficiaries registering with the division in accordance with Subsection 38-11-301 (3) and
Section 38-11-206 ;
(3) fees determined by the division under Section 63-38-3.2 collected from laborers under
Subsection 38-11-204 [(7)](8) when the laborers obtain a recovery from the fund;
(4) amounts collected by subrogation under Section 38-11-205 on behalf of the fund
following a payment from the fund;
(5) application fees determined by the division under Section 63-38-3.2 collected from:
(a) qualified beneficiaries or laborers under Subsection 38-11-204 (1)(b) when qualified
beneficiaries or laborers make a claim against the fund; or
(b) owners or agents of the owners seeking to obtain a certificate of compliance for the
owner;
(6) registration fees determined by the division under Section 63-38-3.2 collected from
other qualified beneficiaries registering with the department in accordance with Subsection
38-11-301 (3)(a)(iii);
(7) reinstatement fees determined by the division under Section 63-38-3.2 collected from
registrants in accordance with Subsection 38-11-302 (5)(b);
(8) civil fines authorized under Subsection 38-11-205 (2) collected by the attorney general
for failure to reimburse the fund; and
(9) any interest earned by the fund.
Section 9. Section 38-11-203 is amended to read:
38-11-203. Disbursements from the fund -- Limitations.
(1) A payment of any claim upon the fund by a qualified beneficiary shall be made only
upon an order issued by the director finding that:

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(a) the claimant was a qualified beneficiary during the construction on a residence;
(b) the claimant complied with the requirements of Section 38-11-204 ; and
(c) there is adequate money in the fund to pay the amount ordered.
(2) A payment of a claim upon the fund by a laborer shall be made only upon an order
issued by the director finding that:
(a) the laborer complied with the requirements of Subsection 38-11-204 [(6)](7); and
(b) there is adequate money in the fund to pay the amount ordered.
(3) (a) An order under this section may be issued only after the division has complied with
the procedures established by rule under Section 38-11-105 .
(b) The director shall order payment of the qualified services as established by evidence,
or if the claimant has obtained a judgment, then in the amount awarded for qualified services in
the judgment to the extent the qualified services are attributable to the owner-occupied residence
at issue in the claim.
(c) The director shall order payment of interest on [all] amounts claimed for qualified
services based on the current prime interest rate at the time payment was due to the date the claim
is approved for payment except for delays attributable to the claimant but not more than 10% per
annum.
(d) The rate shall be the Prime Lending Rate as published in the Wall Street Journal on
the first business day of each calendar year adjusted annually.
(e) The director shall order payment of costs in the amount stated in the judgment. If the
judgment does not state a sum certain for costs, or if no judgment has been obtained, the director
shall order payment of reasonable costs as supported by evidence. The claim application fee as
established by the division pursuant to Subsection 38-11-204 (1)(b) is not a reimbursable cost.
(f) If a judgment has been obtained with attorneys' fees, notwithstanding the amount
stated in a judgment, or if no judgment has been obtained but the contract provides for attorneys'
fees, the director shall order payment of attorneys' fees not to exceed 15% of qualified services.
If the judgment does not state a sum for attorneys' fees, no attorneys' fees will be paid by the
director.

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(4) (a) Payments made from the fund may not exceed $75,000 per construction project to
[all] qualified beneficiaries and laborers who have claim against the fund for that construction
project.
(b) If claims against the fund for a construction project exceed $75,000, the $75,000 shall
be awarded proportionately so that each qualified beneficiary and laborer awarded compensation
from the fund for qualified services shall receive an identical percentage of the qualified
beneficiary's or laborer's award.
(5) Subject to the limitations of Subsection (4), if on the day the order is issued there are
inadequate funds to pay the entire claim and the director determines that the claimant has
otherwise met the requirements of Subsection (1) or (2), the director shall order additional
payments once the fund meets the balance limitations of Section 38-11-206 .
[(6) The Executive Director of the Department of Commerce shall initiate a study to
determine the viability of the Lien Recovery Fund.]
Section 10. Section 38-11-204 is amended to read:
38-11-204. Claims against the fund -- Requirement to make a claim --
Qualifications to receive compensation -- Qualifications to receive a certificate of
compliance.
(1) To claim recovery from the fund a person shall:
(a) meet the requirements of either Subsection [(3)] (4) or [(6)] (7);
(b) pay an application fee determined by the division under Section 63-38-3.2 ; and
(c) file with the division a completed application on a form provided by the division
accompanied by supporting documents establishing:
(i) that the person meets the requirements of either Subsection [(3)] (4) or [(6)] (7);
(ii) that the person was a qualified beneficiary or laborer during the construction on the
owner-occupied residence; and
(iii) the basis for the claim.
(2) To recover from the fund, the application required by Subsection (1) shall be filed no
later than one year:

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(a) from the date the judgment required by Subsection [(3)(c)] (4)(d) is entered;
(b) from the date the nonpaying party filed bankruptcy, if the claimant is precluded from
obtaining a judgment or from satisfying the requirements of Subsection [(3)(c)] (4)(d) because the
nonpaying party filed bankruptcy within one year after the entry of judgment; or
(c) [if a laborer,] from the date the laborer, trying to recover from the fund, completed the
laborer's qualified services.
(3) To obtain a certificate of compliance an owner or agent of the owner shall establish
with the division that the owner meets the requirements of Subsections (4)(a) and (4)(b).
[(3)] (4) To recover from the fund, regardless of whether the residence is occupied by the
owner, a subsequent owner, or the owner or subsequent owner's tenant or lessee, a qualified
beneficiary shall establish that:
(a) (i) the owner of the owner-occupied residence or the owner's agent entered into a
written contract with an original contractor licensed or exempt from licensure under Title 58,
Chapter 55, Utah Construction Trades Licensing Act[,]:
(A) for the performance of qualified services[,];
(B) to obtain the performance of qualified services by others[,]; or
(C) for the supervision of the performance by others of qualified services in construction
on that residence;
(ii) the owner of the owner-occupied residence or the owner's agent entered into a written
contract with a real estate developer for the purchase of an owner-occupied residence; or
(iii) the owner of the owner-occupied residence or the owner's agent entered into a
written contract with a factory built housing retailer for the purchase of an owner-occupied
residence;
(b) the owner has paid in full the original contractor, licensed or exempt from licensure
under Title 58, Chapter 55, Utah Construction Trades Licensing Act, real estate developer, or
factory built housing retailer under Subsection [(3)] (4)(a) with whom the owner has a written
contract in accordance with the written contract and any amendments to the contract[, and:];
(c) (i) the original contractor, licensed or exempt from licensure under Title 58, Chapter

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55, Utah Construction Trades Licensing Act, the real estate developer, or the factory built
housing retailer subsequently failed to pay a qualified beneficiary who is entitled to payment under
an agreement with that original contractor or real estate developer licensed or exempt from
licensure under Title 58, Chapter 55, Utah Construction Trades Licensing Act, for services
performed or materials supplied by the qualified beneficiary;
(ii) a subcontractor who contracts with the original contractor, licensed or exempt from
licensure under Title 58, Chapter 55, Utah Construction Trades Licensing Act, the real estate
developer, or the factory built housing retailer failed to pay a qualified beneficiary who is entitled
to payment under an agreement with that subcontractor or supplier; or
(iii) a subcontractor who contracts with a subcontractor or supplier failed to pay a
qualified beneficiary who is entitled to payment under an agreement with that subcontractor or
supplier;
[(c)] (d) (i) the qualified beneficiary filed:
(A) an action against the nonpaying party to recover monies owed [him] to the qualified
beneficiary within 180 days from the date the qualified beneficiary last provided qualified services,
unless precluded from doing so by the nonpaying party's bankruptcy filing within the 180 days
after completion of services; and
(B) a notice of commencement of action with the division within 30 days from the date
the qualified beneficiary filed the civil action if a civil action was filed as required by Subsection
[(3)(c)] (4)(d)(i)(A);
(ii) the qualified beneficiary has obtained a judgment against the nonpaying party who
failed to pay the qualified beneficiary under an agreement to provide qualified services for
construction of that owner-occupied residence;
(iii) (A) the qualified beneficiary has:
(I) obtained from a court of competent jurisdiction the issuance of an order requiring the
judgment debtor, or if a corporation any officer of the corporation, to appear before the court at a
specified time and place to answer concerning the debtor's or corporation's property[, has];
(II) received return of service of the order from a person qualified to serve documents

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under the Utah Rules of Civil Procedure, Rule 4(b)[,]; and [has]
(III) made reasonable efforts to obtain asset information from the supplemental
proceedings; and
(B) if assets subject to execution are discovered as a result of the order required under
Subsection [(3)(c)] (4)(d)(iii)(A) or for any other reason, to obtain the issuance of a writ of
execution from a court of competent jurisdiction; or
(iv) the [claimant] qualified beneficiary timely filed a proof of claim where permitted in
the bankruptcy action, if the nonpaying party has filed bankruptcy; [and]
[(d)] (e) the qualified beneficiary is not entitled to reimbursement from any other
person[.]; and
(f) the qualified beneficiary provided qualified services to a contractor, licensed or exempt
from licensure under Title 58, Chapter 55, Utah Construction Trades Licensing Act.
[(4)] (5) The requirements of [Subsection (3)(c)] Subsections (4)(d)(i), (ii), and (iii) need
not be met if the qualified beneficiary has been precluded from obtaining a judgment against the
nonpaying party or from satisfying the requirements of [Subsection (3)(c)] Subsections (4)(d)(i),
(ii), and (iii) because the nonpaying party filed bankruptcy.
[(5)] (6) If a qualified beneficiary fails to file the notice with the division required under
Subsection [(3)(c)] (4)(d)(i)(B), the claim of the qualified beneficiary shall be paid:
(a) if otherwise qualified under this chapter;
(b) to the extent that the limit of Subsection 38-11-203 (4)(a)[(i)] has not been reached by
payments from the fund to qualified beneficiaries who have complied with the notice requirements
of Subsection [(3)(c)] (4)(d)(i)(B); and
(c) in the order that the claims are filed by persons who fail to comply with Subsection
[(3)(c)] (4)(d)(i)(B), not to exceed the limit of Subsection 38-11-203 (4)(a)[(i)].
[(6)] (7) To recover from the fund a laborer shall:
(a) establish that the laborer has not been paid wages due for the work performed at the
site of a construction on an owner-occupied residence; and
(b) provide any supporting documents or information required by rule by the division.

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[(7)] (8) A fee determined by the division under Section 63-38-3.2 shall be deducted from
any recovery from the fund received by a laborer.
[(8)] (9) The requirements of [Subsection (3)(a)(i)] Subsections (4)(a) and (4)(b) may be
satisfied if [a claimant] an owner or agent of the owner establishes to the satisfaction of the
director that the owner of the owner-occupied residence or the owner's agent entered into a
written contract with an original contractor who:
(a) was a business entity that was not licensed under Title 58, Chapter 55, Utah
Construction Trades Licensing Act, but was solely or partly owned by an individual [that] who
was licensed under Title 58, Chapter 55, Utah Construction Trades Licensing Act; or
(b) was a natural person who was not licensed under Title 58, Chapter 55, Utah
Construction Trades Licensing Act, but who was the sole or partial owner and qualifier of a
business entity that was licensed under Title 58, Chapter 55, Utah Construction Trades Licensing
Act.
(10) The director shall have equitable power to determine if the requirements of
Subsections (4)(a) and (4)(b) have been met, but any decision by the director under Title 38,
Chapter 11, shall not alter or have any effect on any other decision by the division under Title 58.

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