ALJDEC - Licensing

2024A-02335-NPC-ROC · Registrar of Contractors · 2024-08-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Art Enriquez Concrete, LLC,

COMPLAINANT,

v.

Troon Enterprises, Inc.

License No. ROC 297652,

RESPONDENT.

No. 2024A-02335-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 7, 2024

APPEARANCES: Megan N. Schandle, Esq. represented Complainant Art Enriquez Concrete, LLC. Arturo Enriquez and Maria Enriquez appeared on behalf of Complainant Art Enriquez Concrete, LLC. Respondent Troon Enterprises, Inc. did not appear.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

EXHIBITS ADMITTED INTO EVIDENCE: Exhibits 1-13

FINDINGS OF FACT

Troon Enterprises, Inc. (“Respondent”) is the holder of License Number 297652 issued by the Arizona Registrar of Contractors (“Registrar”).

On or about February 26, 2024, Art Enriquez Concrete, LLC (“Complainant”) filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the sum of $79,993.00 for concrete work Complainant performed during the construction of the La Quinta Hotel located at 9050 West McDowell Road, in Phoenix, Arizona.

The parties were unable to resolve their differences. The Registrar issued a Citation against Respondent for its alleged violations of A.R.S. § 32-1154(A)(10) and A.R.S. § 32-1183(B).

The matter was set for administrative hearing before the Office of Administrative Hearings on August 7, 2024. On the date and at the time set for hearing, and after proper notice, Respondent failed to appear. After a grace period, the matter proceeded to hearing.

Arturo Enriquez, Complainant’s owner, testified that Complainant was hired by Respondent as a subcontractor for the project owned by Greencity Hotel, LLC, to perform the concrete work. The parties contracted on May 22, 2023, and the total contract price was $299,000.00. Mr. Enriquez credibly testified that Complainant performed its scope of work pursuant to the parties’ contract.

On or about May 30, 2023, Complainant sent Respondent an invoice in the amount of $29,900.00 for “Building Footings & Slab on Grade, Elevator[,] Elevator Pit, Continuous Footings, Spread Footings, Slab, Hold Down and Anchor Bolts.” Respondent did not pay the invoice.

On July 20, 2023, Complainant sent Respondent an invoice in the amount of $200,330.00 for “Building Footings & Slab on Grade, Elevator[,] Elevator Pit, Continuous Footings, Spread Footings, Slab, Hold Down and Anchor Bolts.” Respondent paid Complainant $150,297.00 of this invoice amount, leaving a balance of $50,033.00.

Mr. Enriquez credibly testified that Respondent did not notify Complainant of any issues with the work performed by Complainant, Respondent did not object to the invoices, and Respondent made no further payments.

Complainant submitted into evidence the Arizona Lien Waiver and Release Form Unconditional Waiver and Release on Final Payment (“Lien Waiver”) issued by Greencity Hotel, LLC to Respondent regarding the La Quinta Hotel Project located at 9050 West McDowell Road, Phoenix, Arizona 85037, demonstrating that Respondent had been paid in full for this project by the owner of the project. The Lien Waiver signed by Respondent’s representative on May 7, 2024, states that:

The undersigned warrants that he either has already paid or will use the monies he/she Receives from this final payment to promptly pay in full all his laborers, subcontractors, materialmen and suppliers for all work, materials, equipment, or services provided for or to the above referenced project up to the date of this waiver.

Therefore, as of May 7, 2024, Respondent had been paid in full by the owner of the project and signed the Lien Waiver stating that Respondent had either already paid all subcontractors in full or would promptly do so.

Respondent failed to appear and therefore, did not present any controverting evidence.

CONCLUSIONS OF LAW

The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in this matter is by a preponderance of the evidence.

A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.”

A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license:

Failure by a licensee or agent or official of a licensee to pay monies in excess of $750 when due for materials or services rendered in connection with the licensee's operations as a contractor unless the licensee proves that the licensee lacks the capacity to pay and has not received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.

A.R.S. § 32-1183(B) sets forth:

If a subcontractor or material supplier has performed in accordance with the provisions of a construction contract, the contractor shall pay to its subcontractors or material suppliers and each subcontractor shall pay to its subcontractors or material suppliers, within seven days of receipt by the contractor or subcontractor of each progress payment, retention release or final payment, the full amount received for such subcontractor's work and materials supplied based on work completed or materials supplied under the subcontract. Payment shall not be required pursuant to this subsection unless the subcontractor or material supplier provides to the contractor or subcontractor a billing or invoice for the work performed or material supplied in accordance with the terms of the construction contract between the parties. Each subcontractor or material supplier shall provide a waiver of any mechanic's or materialman's lien conditioned on payment for the work completed or material supplied. The contractor or subcontractor may require that such conditional waivers of lien be notarized. Any diversion by the contractor or subcontractor of payments received for work performed pursuant to a contract, or failure to reasonably account for the application or use of such payments, constitutes grounds for disciplinary action by the registrar of contractors. Violations of this section shall be grounds for suspension or revocation of a license or other disciplinary action by the registrar pursuant to section 32-1154, subsections B, C and D. The subcontractor or material supplier may notify the registrar of contractors and the owner in writing of any payment less than the amount or percentage approved for the class or item of work as set forth in this section.

Emphasis added.

The evidence established that Respondent owed a total of $79,993.00 for the work performed by Complainant and that Respondent was paid in full for the project by May 7, 2024.

Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(10) and A.R.S. § 32-1183(B) by failing to pay Complainant $79,993.00 for services or materials rendered in connection with Respondent’s contracting business.

Based upon Respondent’s violation of the provisions of A.R.S. § 32-1154(A)(10) and A.R.S. § 32-1183(B), grounds exist to impose discipline against Respondent’s license.

RECOMMENDed order

Based on the foregoing, it is recommended that the Registrar suspend Respondent’s License Number 297652 issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $79,993.00 in certified funds.

It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $79,993.00 in certified funds, the Registrar may close the Complaint in Case Number 2024-02335.

Pursuant to A.R.S. § 41-1092.08(I), the licensee may accept the Administrative Law Judge Decision by advising the Office of Administrative Hearings in writing not more than ten (10) days after receiving the decision. If the licensee accepts the Administrative Law Judge Decision, the decision shall be certified as the final decision by the Office of Administrative Hearings.

In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be forty (40) days from the date of that certification.

Done this day, August 14, 2024.

/s/ Sondra J. Vanella

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Tom Cole, Director

Registrar of Contractors

[email redacted]

Megan N. Schandle, Esq.

[email redacted]

Troon Enterprises, Inc.

[email redacted]

By: OAH Staff