ALJDEC decisions subject to certification as final

06F-2182-ROC · Registrar of Contractors · 2006-11-13

STATE OF ARIZONA IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 13, 2006 APPEARANCES: Complainant : Jim Galassi appeared pro se. Respondent : Smith & Craven PLLC, Gary Michael Smith, Esq. appeared for Skytech Investment Drilling, Inc. Testifying was B. J. Washburn, Qualifying Party. ADMINISTRATIVE LAW JUDGE: Gary B. Strickland _____________________________________________________________________

A Hearing was convened to determine whether Respondent Skytech Investment Drilling, Inc. violated state law as has been alleged by Complainant Jim Galassi and as cited by the Arizona Registrar of Contractors (hereinafter also “the Registrar” or “the ROC”). Evidence and testimony were presented. Respondent Skytech Investment Drilling, Inc. holds a Class C-53 (Residential Drilling) license issued by the Registrar of Contractors. Complainant alleges that Respondent accepted money from Complainant for the drilling of a well on Complainant’s property but mistakenly and wrongly drilled the hole on the property of a neighbor. Based upon the testimony and evidence presented, along with a careful review of the entire record,[1] the following Findings of Fact are made, Conclusions of Law rendered, and DECISION AND RECOMMENDED ORDER issued:

FINDINGS OF FACT 1. Respondent’s license (No. 144685) was initially issued on May 31, 1999, most recently renewed on May 31, 2005 with viability through May 31, 2007.[2] 2. B. J. Washburn is the Qualifying Party identified on the Skytech Investment Drilling, Inc. (hereinafter also, “the Contractor” or “Skytech Investment Drilling”) license.[3] 3. Skytech Investment Drilling also holds an A-04 License (Commercial Drilling), No. 149362.[4] 4. The project at issue involved the drilling of a water well hole at property situated in Rio Verde, Arizona. The contract for drilling was executed in Arizona; the drilling was to take place on Arizona soil; and the drilling Contractor is licensed by the ROC. As such, the acts and omissions alleged in the Complaint fall within the requirements of Title 32, Chapter 10, Article 3. 5. Complainant Jim Galassi entered into a written agreement[5] (“the Agreement”) with Skytech Investment Drilling on or about May 28, 2005 whereby Skytech Investment Drilling agreed to drill a hole in search of water according to the terms of an estimate[6] theretofore provided to Mr. Galassi for the construction endeavor. The estimate set forth a $15,948.34 anticipated price. Mr. Galassi stipulated that the Agreement and estimate constituted the parties’ contract. 6. The Agreement provided that the purchaser (in this case Mr. Galassi) acknowledged, among other things:

• Purchaser hereby takes full responsibility for selecting the exact site of the drilling.

The Agreement further indicated that the estimate previously quoted would remain open for a period of thirty (30) days and that a deposit of $5,000. would be due at the time that the drilling equipment arrived at the property. 7. Mr. Galassi paid the sum of $6,000. to Skytech Investment Drilling on May 29, 2005, the day that Mr. Galassi met with Mr. Washburn at the property to pinpoint the precise location for the drilling. However, although the drilling was completed (albeit water was not discovered to 750 ft.), the balance of the contract price has not been paid by Mr. Galassi to Skytech Investment Drilling. 8. During the parties’ walk about the property on May 29, 2005, Galassi and Washburn came upon a surveyor’s pin that appeared to match the number and location of a pin identified on a survey map that Mr. Galassi had brought to the site. Believing the spot properly identified the anticipated location for the drilling, the two men marked the spot further and left the property in agreement as to its correct location. 9. The drilling commenced on June 3, 2005. 10. At the conclusion of its drilling efforts, Skytech Investment Drilling capped the hole according to code requirements. 11. Three or four months after the hole had been drilled, Mr. Galassi informed Mr. Washburn that the hole had, in fact, been dug on neighboring property not belonging to Mr. Galassi. 12. Disconcerted over the news that Skytech Investment Drilling had drilled the hole on neighboring property, Mr. Galassi filed a Complaint to the Registrar of Contractors on April 10, 2006 alleging that Skytech Investment Drilling had wrongly chosen the spot whereat the drilling occurred. 13. Thereafter, because no resolution was forthcoming, the ROC issued a CITATION AND COMPLAINT against Skytech Investment Drilling’s residential drilling license on July 17, 2006 alleging violation of A.R.S. § 32-1154(A)(2), (3), (7), and (15). 14. Skytech Investment Drilling filed its ANSWER to the CITATION AND COMPLAINT on July 27, 2006 asserting therein that it was Galassi who had identified the exact spot whereat the hole should be drilled. 15. The ROC issued a NOTICE OF HEARING on October 4, 2006 and the parties convened on the designated date for the presentation of evidence and argument. 16. The weight and sufficiency of the evidence presented by Complainant does not persuade that Skytech Investment Drilling has acted or failed to act in the transaction in a manner that supports the allegations within the CITATION AND COMPLAINT. There has been no persuasive showing of a departure from plans or codes; there has not been any evidence presented that is probative of an allegation that Skytech Investment Drilling acted in the capacity of a Contractor in a name other than the name listed on its license; there has been no identification of an ROC rule that Skytech Investment Drilling might have transgressed, let alone proof of a transgression; nor has there been any demonstration of fraud or wrongful act/omission in the transaction. 17. Under the parties’ contract, the “Agreement,” Galassi was to identify the spot whereat the drilling would occur. The parties differ over which party actually pin-pointed the exact location; nothing persuasive comes of it. However, in light of the contractual language, it is reasonable to infer that Galassi designated the precise location; at least he authorized the drilling at that spot. He had neither provided a metes and bounds description to Skytech Investment Drilling, nor even a local address; the property is located in a “scrub desert.” Mr. Galassi brought a survey map to the site on designation day. It was reasonable for Washburn to rely on the map for site identification. . . . 18. Skytech Investment Drilling contracted to drill a hole, it did so. Moreover, Skytech Investment Drilling’s license supports drilling activities, not surveying activities. Therefore, it can’t be faulted on this record for drilling a hole at what apparently was the Complainant’s direction according to the parties’ contract.

APPLICABLE LAW The CITATION AND COMPLAINT issued by the Registrar of Contractors charged Respondent with possible violations of A.R.S. § 32-1154(A)(3) (A.A.C. R4-9-108, the workmanship rule) and (2),(7), and (15). Those statutory sections require that a holder of a license or a person listed on a license not commit the following:

2. Departure from or disregard of plans or specifications or any building codes of the state or any political subdivision of the state in any material respect which is prejudicial to another without consent of the owner or the owner's duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.

3. Violation of any rule adopted by the Registrar.

7. The doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured.

15. Acting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth upon the license. . . . CONCLUSIONS OF’LAW 1. The Registrar of Contractors has jurisdiction over Complaint No. 06-2182 under the authority of A.R.S. § 32-1101, et seq., a section that enables the Registrar to impose disciplinary sanctions against licensees for violations of A.R.S. § 32-1154. Skytech Investment Drilling is a licensee. 2. The burden of persuasion generally at an administrative hearing falls to the party asserting a claim, right or entitlement, or an Agency seeking to impose a penalty.[7] Further, the standard of proof is that of the “preponderance of the evidence”.[8] Proof by a preponderance means that the evidence is sufficient to persuade the finder of fact that the proposition is “. . . more likely true than not.”[9] The evidence taken as a whole must convince the decision maker that the party who bears the overall burden of persuasion, in this case Complainant Galassi, is more probably correct on the issue(s) in dispute. 3. Observing these standards, Complainant Galassi has not satisfied his burden, by a preponderance of the evidence, that during the transaction and performance at issue Respondent Skytech Investment Drilling violated one of the statutory provisions (A.R.S. § 32-1154(A)(2), (3), (7), and (15)) identified in the Registrar’s CITATION AND COMPLAINT. It is not persuasive that Skytech Investment Drilling acted wrongfully in the transaction; “wrongfully” construed in light of the requisites for contract formation and contract execution. Mr. Galassi assumed the burden to ensure that the hole was drilled in the proper location. That he failed to do so cannot be attributed to any wrongdoing allegedly done by Skytech Investment Drilling.

RECOMMENDED ORDER In view of the foregoing, IT IS RECOMMENDED that the Registrar of Contractors enter an Order dismissing Complaint No. 06-2182. In the event of the 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 days from the date of that certification.

Done this 13th day of November 2006.

______________________________________ Gary B. Strickland Administrative Law Judge

Original transmitted by mail this 14th day of November 2006 to:

Registrar of Contractors Fidelis V. Garcia Legal Department 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________

----------------------- [1] The record consists of those documents found within the Agency’s case file, the contents of which the Administrative Law Judge has accorded Administrative notice, the exhibits offered by the parties, respectively, and the digital record of the proceedings under A.A.C. R2-19-121. Respondent offered two exhibits, marked R-4 and R-16. Both exhibits were received.

[2] http://www.azroc.gov/clsc/AZROCLicenseQuery

[3] Id.

[4] Id.

[5] Exhibit R-16.

[6] Exhibit R-4.

[7] See Ariz. Admin. Code R2-19-119(B).

[8] Culpepper v. Arizona Board of Nursing, 187 Ariz. 431, 930 P.2d 508 (App. 1997); See also Ariz. Admin. Code R2-19-119(A).

[9] In re Arnold and Baker Farms, 177 B.R. 648, 654 (9th Cir. BAP (Ariz.) 1994). See also J. LIVERMORE, R. BARTELS, & A. HAMEROFF, LAW OF EVIDENCE ( 301.1(4th ed. 2000) (One party bears the overall burden of persuasion on each fact material to the party’s claims and defenses. Further, the party with the burden of persuasion on a particular fact is required to satisfy the burden of production of enough qualitative evidence sufficient to support a finding of the existence of the fact, following a reasonable person standard.)

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826