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Attorney Argues Sierra Lugo Ruling Does Not Bar DACO from Solar Panel Contract Disputes

Published Oct 10, 2026, 7:00 AM ASTvia Microjuris al Día

At a glance

  • DACO’s Organic Law grants the agency jurisdiction, regardless of contract terms.
  • Consumers may still be able to vindicate their rights through administrative hearings, despite arbitration clauses in contracts.

Why this matters: For Puerto Rican consumers who have signed solar panel contracts, the DACO’s incorrect interpretation of the Sierra Lugo decision may deny them access to administrative hearings and the ability to vindicate their rights.

Attorney Jeshuan Torres Ramos argues that the Puerto Rico Supreme Court’s decision in Sierra Lugo v. Sunrun PR Operations, LLC (2026 TSPR 76) does not strip the Department of Consumer Affairs (DACO) of authority over solar panel contract disputes. In an opinion piece, he says consumers with complaints against solar companies are being told their cases are archived or that DACO cannot hear them, while industry lawyers argue that only arbitrators can.

Torres Ramos says Sierra Lugo was a court lawsuit, not a DACO complaint. The 2020 contract delegated to the arbitrator the power to decide its own scope, and the plaintiff did not specifically challenge that delegation, so the Court applied Rent-A-Center v. Jackson.

In footnote 32, the Court said it was not deciding the validity of arbitration clauses in solar lease contracts, nor the possible voidability of a clause excluding a regulatory agency’s jurisdiction under Article 1249(g) of the 2020 Civil Code. Torres Ramos adds that the Court did not allow dismissal even in court; it held that proceedings must be suspended pending arbitration.

He says DACO’s jurisdiction comes from its Organic Act, Law 5 of 1973, not from the contract. He argues that applying the clause on its own deprives consumers of an administrative hearing, and that DACO must issue reasoned resolutions under Law 38-2017 if it declines a case. The views are solely the author’s.

SourceMicrojuris al Día

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