ALJDEC - Licensing
2024A-09799-NPC-ROC · Registrar of Contractors · 2025-04-09
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Innovative Plumbing LLC
COMPLAINANT,
v.
REIcon LLC
License No. ROC 340420,
Respondent.
No. 2024A-09799-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: March 20, 2025
APPEARANCES: Dale Eagy appeared on behalf of Innovative Plumbing LLC, (hereinafter “Complainant”). Chris Regal appeared on behalf of REIcon LLC (hereinafter “Respondent.”).
ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson
EXHIBITS ADMITTED INTO EVIDENCE: Exhibit A (the Registrar’s administrative record).
_____________________________________________________________________
Testimony of Dale Eggy
1. On August 23, 2024, the Arizona Registrar of Contractors, (hereinafter “Registrar”) received a complaint wherein Complainant alleged that Respondent failed to pay three invoices totaling $28,880 for services rendered to Respondent in connection with Respondent’s operations as a contactor. See Exhibit A, pgs. 12-32.
2. On September 18, 2024, the Registrar issued a Citation against Respondent’s license alleging that Respondent violated Arizona Revised Statutes (hereinafter “A.R.S.”) 32-1154(A) (10).
3. Respondent filed a timely answer to the Citation.
4. The matter was referred to the Office of Administrative Hearings for an evidentiary hearing.
5. A hearing was held on March 20, 2025.
6. At hearing, Dale Eagy and Jennifer Clayton testified on behalf of Complainant. Chris Reigel testified on behalf of Respondent.
Testimony of Dale Eagy
7. Mr. Eagy is an owner of Complainant. Mr. Eagy explained that Complainant provided the materials and services described in invoices 7452, 7453, and 7612. Mr. Eagy stated that Complainant was the only trade that was not paid by Respondent. Complainant explained that Respondent approved of the necessary change order in Invoice #7542 for $6,800.
8. I find Mr. Eagy’s testimony to be credible.
Testimony of Chris Reigel
9. Mr. Reigel is an owner of Respondent. Mr. Reigel explained that Complainant should be paid for the invoices that he submitted in the complaint. However, Mr. Reigel stated that he was terminated by the owner, Hummus Republic, and that the owner did not agree with the change order in Invoice #7542. Mr. Reigel testified that his contract with Hummus Republic would have been over $400,000 if Hummus Republic had not fired Respondent from the job.
Testimony of Jennifer Clayton
10. Ms. Clayton is an owner of Hummus Republic. Ms. Clayton stated that she paid Respondent 338,000.00 for the project. Ms. Clayton stated that Respondent was required to pay Complainant in full from the amount that she paid Respondent. However, Ms. Clayton did not dispute that she terminated her contract with Respondent.
11. I find Ms. Clayton’s testimony to be credible.
CONCLUSIONS OF LAW
A party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. A.A.C. R2-19-119.
“At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” A.R.S. § 41-1092.07(G)(2).
A preponderance of the evidence is:
The greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.
Black’s Law Dictionary 1373 (10th ed. 2014).
Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").
“Statutes shall be liberally construed to effect their objects and to promote justice.” A.R.S. § 1-211(B).
The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).
A.R.S. § 32-1154(A) provides that:
The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: .... 10. Failure by a licensee or agent or official of a licensee to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee's operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.
8. A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[f]ailure by a licensee . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee’s operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.”
9. Payment for “[s]ervices rendered in connection with the licensee’s operations as a contractor” does not include interest, finance charges, lien charges, or other charges that are based solely on contract terms.
10. Complainant established by a preponderance of the evidence that Respondent failed to pay Complainant the amount of $28,880.00 when payment became due for materials and services rendered to Respondent in connection with its operations as a contractor. Although Respondent contended that he was not paid by the owner, Respondent has not established that it lacks the capacity to pay Complainant. 11. The preponderance of the evidence shows that Respondent violated Ariz. Rev. Stat § 32-1154(A)(10) as alleged.
12. Based upon Respondent’s violation of the provisions of A.R.S. § 32-1154(A)(10), grounds exist to impose discipline against Respondent’s license.
13. Because A.R.S. § 32-1154(A)(10) only includes a licensee’s failure to pay for
materials or services rendered in connection with the licensee’s operations as a contractor, not late fees, interest, or other consequential or contractual damages, the Administrative Law Judge does not recommend that Respondent be required to pay late fees as a condition of keeping its contractor’s license in good standing.
RECOMMENDed order
Based on the foregoing, it is recommended that the Registrar suspend REIcon LLC License No. ROC 340420, issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $28,880.00 in certified funds.
It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $28,880 in certified funds, the Registrar may close the Complaint in Case No. 2024A-09799.
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, April 9, 2025.
/s/ Velva Moses-Thompson
Administrative Law Judge
Transmitted by either mail, e-mail, or facsimile to:
Tom Cole, Director
Registrar of Contractors
REIcon LLC
[email redacted]
Innovative Plumbing LLC
[email redacted]
[email redacted]
[email redacted]
By: OAH Staff