ALJDEC - Licensing

2026A-00361-NPC-ROC · Registrar of Contractors · 2026-05-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Hulxe Construction Services LLC,

COMPLAINANT

v.

K N J SOLUTIONS LLC,

License No. ROC 358840,

RESPONDENT

No. 2026A-00361-NPC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 6, 2026

APPEARANCES: Eric Varela and Natalie Custer on behalf of Complainant. Kristie Pitts, Qualifying Party, on behalf of Respondent K N J Solutions LLC.

ADMINISTRATIVE LAW JUDGE: Fahd Nazir

EXHIBITS ADMITTED INTO EVIDENCE: Administrative notice was taken of the hearing packet submitted by the Registrar of Contractors.

FINDINGS OF FACT

K N J Solutions LLC (Respondent) is the holder of License No. 358840 issued by the Registrar of Contractors (Registrar).

On or about May 6, 2025, Hulxe Construction Services LLC (Complainant) subcontracted with Respondent for, among other things, pavement marking installation.

On or about January 13, 2026, Complainant filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the sum of $6,219.01.

The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a Citation alleging a possible violation of Ariz. Rev. Stat. § 32-1154(A)(10).

Mr. Varela and Ms. Custer testified on behalf of Complainant that the total due to Complainant was $6,219.01. The witnesses stated that all agreed-upon work was performed in good faith and that Respondent had not paid, despite multiple attempts to collect payment.

Ms. Pitts testified on behalf of Respondent that there was no dispute as to the amount owed. However, due to dwindling business, Respondent lacked the ability to pay the amount owed in full. When asked about past payments for the project by the client, Ms. Pitts acknowledged that Respondent was paid for the project but “lost” the money “in translation when moving from one company to another.”

Respondent was willing to enter into a payment agreement with Complainant but was a month behind on mortgage payments and faced financial difficulties.

The credible evidence presented at hearing established that Complainant performed all the work it was contracted to perform.

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 these matters 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.”

Ariz. Rev. Stat. § 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 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.

The evidence established that Respondent owed a total of $6,219.01.

Although Respondent was experiencing financial strain, it failed to establish by a preponderance of the evidence that it lacked the ability to pay, as required under the law, Complainant for the work performed.

Therefore, Complainant established that Respondent violated Ariz. Rev. Stat. § 32-1154(A)(10) by failing to pay Complainant $6,219.01 for services or materials rendered in connection with Respondent’s contracting business.

Based upon Respondent’s violation of the provisions of Ariz. Rev. Stat. § 32-1154(A)(10), 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 No: 358840 issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted documents that establish that it has paid Complainant $6,219.01 in certified funds.

It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $6,219.01 in certified funds, the Registrar may close the Complaint in Case No. 2026-00361.

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, May 26, 2026.

/s/ Fahd Nazir

Administrative Law Judge

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

Tom Cole, Director

Registrar of Contractors

[email redacted]

Hulxe Construction Services LLC

[email redacted]

[email redacted]

By: OAH Staff