Case Summary
| Case ID | 17F-H1716023-REL |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2017-05-16 |
| Administrative Law Judge | Tammy L. Eigenheer |
| Outcome | no |
| Filing Fees Refunded | $0.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Barry Saxion | Counsel | — |
|---|---|---|---|
| Respondent | Silverton II Homeowners Association, Inc. | Counsel | Troy B. Stratman, Esq. |
Alleged Violations
Declaration Section 12.1
Outcome Summary
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
- Declaration Section 12.1
- A.R.S. § 41-1092.08
Analytics Highlights
- Declaration Section 12.1
- A.R.S. § 41-1092.08
Video Overview
Audio Overview
Decision Documents
17F-H1716023-REL Decision – 564668.pdf
17F-H1716023-REL Decision – 564672.pdf
17F-H1716023-REL Decision – 568837.pdf
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate
Study Guide: Saxion v. Silverton II Homeowners Association, Inc.
Short-Answer Quiz
Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the case documents.
1. Identify the primary parties involved in case number 17F-H1716023-REL and their respective roles.
2. What was the initial argument made by the Respondent, Silverton II HOA, in its Motion for Summary Judgement?
3. How did the Administrative Law Judge (ALJ) resolve the issue of Barry Saxion’s standing to pursue the action?
4. What was the second, and ultimately successful, argument presented by the Respondent for the case’s dismissal?
5. According to the HOA’s governing documents, what is the definition of a “covered claim”?
6. What was the final recommendation made by Administrative Law Judge Tammy L. Eigenheer in her decision dated May 16, 2017?
7. What immediate procedural action was taken as a result of the ALJ’s recommended decision on May 16, 2017?
8. Who formally accepted the ALJ’s decision, and what was the title of the document that finalized this acceptance?
9. What process must the petitioners now follow to resolve their dispute with the HOA, according to the final ruling?
10. Following the issuance of the Final Order on May 30, 2017, what right did the parties have if they disagreed with the decision?
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Answer Key
1. The primary parties were the Petitioners, Barry and Sandra Saxion, and the Respondent, Silverton II Homeowners Association, Inc. The Saxions initiated the dispute process, and the Homeowners Association was the entity against which the claim was filed.
2. The Respondent initially argued that the case should be dismissed because Petitioner Barry Saxion did not own property within the Association. This lack of ownership, they claimed, meant he did not possess the legal standing required to pursue the action.
3. The ALJ found that although Barry Saxion did not own property, Sandra Saxion did own property and had also signed the petition. Therefore, Sandra Saxion had standing to pursue the action, and the ALJ recommended denying the motion to dismiss on these grounds.
4. The Respondent’s successful argument was that Section 12.1 of the HOA’s Declaration required all covered claims to be resolved using the internal dispute resolution procedures set forth in the Declaration and Bylaws. They argued this must be done in lieu of initiating administrative proceedings.
5. A “covered claim” is defined as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
6. On May 16, 2017, the ALJ recommended that the Petition be dismissed. She concluded that the plain language of the HOA’s governing documents required the claim to be handled through the internal dispute resolution process before any administrative proceedings could be brought.
7. As a result of the ALJ’s recommendation, an order was issued vacating the hearing that was scheduled for May 22, 2017. The parties were advised of this through a Minute Entry.
8. Judy Lowe, the Commissioner of the Department of Real Estate, formally accepted the ALJ’s decision. This was finalized in a document titled “Final Order,” dated May 30, 2017.
9. The petitioners must handle their claim through the dispute resolution process set forth in the Silverton II Declaration and Bylaws. The Final Order mandates that this internal process must be used prior to bringing administrative proceedings.
10. After the Final Order, pursuant to A.R.S. § 41-1092.09, a party had the right to file a motion for rehearing or review within thirty (30) days. They also had the right to appeal the final administrative decision by filing a complaint for judicial review.
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Essay Questions
Instructions: The following questions require a more detailed analysis of the case. Formulate a comprehensive response for each, drawing connections between the different documents and legal concepts presented.
1. Analyze the concept of “standing” as it was presented and resolved in this case. Discuss why Barry Saxion’s lack of property ownership did not result in the case’s dismissal on those grounds, and explain the role of the original Petition in the ALJ’s finding.
2. Explain the legal hierarchy and procedural flow of this dispute. Trace the case from the initial petition to the Final Order, identifying the specific roles and actions of the Department of Real Estate, the Office of Administrative Hearings, the Administrative Law Judge, and the Commissioner.
3. Discuss the significance of Section 12.1 of the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” How did the “plain language” of this specific clause determine the ultimate outcome of the administrative proceeding?
4. Evaluate the two distinct arguments made by the Respondent in their Motion for Summary Judgement. Compare the legal reasoning used by the Administrative Law Judge in her recommendations for each argument and explain why one argument failed while the other succeeded.
5. Describe the post-decision options available to the parties following the issuance of the Final Order on May 30, 2017. What specific steps could a party take if they disagreed with the outcome, what were the associated deadlines, and to whom would a request for rehearing be addressed?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official who presides over administrative hearings, reviews evidence, and issues a recommended decision. In this case, the ALJ was Tammy L. Eigenheer.
Administrative Law Judge Decision
The formal written recommendation of the ALJ. In this matter, the decision recommended that the petition be dismissed based on the HOA’s governing documents.
Commissioner
The head of the Arizona Department of Real Estate. In this case, Commissioner Judy Lowe adopted the ALJ’s decision and issued the Final Order.
Covered Claims
A specific category of disputes defined in the HOA’s Declaration. It includes all claims, grievances, or disputes related to the interpretation, application, or enforcement of the HOA’s governing documents.
Declaration
The short name for the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” This is a core governing document for the HOA that dictates required procedures, such as dispute resolution.
Department of Real Estate (Department)
The Arizona state agency that referred the HOA dispute to the Office of Administrative Hearings and whose Commissioner issued the Final Order.
Final Order
A binding order issued by the Commissioner of the Department of Real Estate that accepts the ALJ’s decision. This order made the dismissal of the petition official and effective immediately.
Homeowners Association (HOA)
The governing body for the Silverton II community, which was the Respondent in this case.
Minute Entry
A brief entry on the case record noting a court or judge’s order or action. In this case, a Minute Entry was issued to vacate the scheduled May 22, 2017 hearing.
Motion for Summary Judgement
A formal request made by a party (in this case, the Respondent) asking the judge to rule in their favor without a full hearing, based on the argument that there are no disputed facts and the law is on their side.
Office of Administrative Hearings
The state office where the case was heard. It provides a neutral forum for resolving disputes involving state agencies.
Petitioner
The party who initiates a legal action or files a petition. In this case, the petitioners were Barry and Sandra Saxion.
Respondent
The party against whom a petition is filed. In this case, the respondent was the Silverton II Homeowners Association, Inc.
Standing
The legal right to bring a lawsuit or administrative action. In this context, standing was initially questioned based on property ownership within the HOA.
Why This Homeowner’s Complaint Against Their HOA Was Dismissed Before It Began
Dealing with a Homeowners Association (HOA) can be one of the most frustrating aspects of homeownership. When you feel the association is overstepping its bounds or failing to enforce the rules fairly, the natural impulse is to seek a formal resolution. Homeowners have rights, and there are official channels, like administrative hearings, designed to address these disputes.
But what if the path to justice has a mandatory detour you didn’t know about? The case of Saxion vs. Silverton II HOA is a powerful cautionary tale for any homeowner who believes they have a legitimate grievance. A close look at the official documents reveals surprising lessons, and it’s a stark reminder that in an HOA dispute, being right is not enough; you must also be procedurally perfect.
1. The Fine Print Is Your First Hurdle
The primary reason the homeowners’ petition was dismissed had nothing to do with the merits of their actual complaint. The Administrative Law Judge (ALJ) never weighed in on whether the homeowners were right or the HOA was wrong. Instead, the case was dismissed because the homeowners failed to follow the mandatory dispute resolution process required by their own HOA’s governing documents before they filed for an administrative hearing.
The association’s own rules legally required an internal process to be completed first. By going straight to an administrative filing, the homeowners had unintentionally bypassed a mandatory first step outlined in their governing documents. The ALJ pointed to the specific language in the HOA’s Declaration, which was the ultimate authority on the matter.
all covered claims “must be resolved using the dispute resolution procedures set forth . . . in [the] Declaration and the Bylaws in lieu of filing a lawsuit or initiating administrative proceedings.”
2. A Simple Clerical Error Can Jeopardize Your Entire Case
Before even getting to the core procedural issue, the HOA made another challenge that could have ended the case immediately. They argued that the petitioner officially named in the case caption, Barry Saxion, didn’t actually own property in the association and therefore had no legal standing.
This error, however, wasn’t made by the homeowners. The case documents reveal a critical lesson: when the Arizona Department of Real Estate referred the matter for a hearing, it was the agency that created the incorrect caption. This bureaucratic mistake could have been fatal, but the petition was saved because the ALJ noted that the original paperwork was signed by both Barry Saxion and Sandra Saxion, who did own property. Because both their names and signatures were on the petition, the ALJ could overlook the agency’s error. This highlights the need for homeowners to be vigilant, double-checking all official documents—even those prepared by a state agency.
3. A “Win” Doesn’t Always Mean Justice Was Served
The final outcome was not a judgment on the underlying disagreement. The petition was simply “dismissed.” This means the core issues the homeowners wanted to resolve were never actually heard or ruled on by the Administrative Law Judge.
The process itself is revealing. On May 16, 2017, the ALJ, Tammy L. Eigenheer, issued a recommendation that the complaint be dismissed. This recommendation was then reviewed by the Commissioner of the Department of Real Estate, Judy Lowe, who accepted it and issued a FINAL ORDER making the dismissal official on May 30, 2017. For the HOA, this was a victory won on a technicality. For the homeowners, it was a procedural dead end, preventing their core complaints from being heard in the administrative hearing. This shows how a legal victory can be won entirely on procedure, preventing the central conflict from ever being addressed.
Conclusion
The core lesson from the Saxion vs. Silverton II HOA case is clear: in a dispute with your HOA, understanding the procedural rules in your governing documents is just as important as the substance of your complaint. Failing to read and follow these rules can render your entire effort, no matter how justified, completely invalid. It can cost you time, money, and the opportunity to have your case heard at all. Before you take on your HOA, have you read the rulebook they require you to play by?
Case Participants
Petitioner Side
- Barry Saxion (petitioner)
- Sandra Saxion (petitioner)
Respondent Side
- Troy B. Stratman (Respondent attorney)
Stratman Law Firm, PLC
Neutral Parties
- Tammy L. Eigenheer (ALJ)
- Judy Lowe (Commissioner)
Arizona Department of Real Estate - Abby Hansen (HOA Coordinator)
Arizona Department of Real Estate - L. Dettorre (ADRE Staff)
Arizona Department of Real Estate - D. Jones (ADRE Staff)
Arizona Department of Real Estate - J. Marshall (ADRE Staff)
Arizona Department of Real Estate - N. Cano (ADRE Staff)
Arizona Department of Real Estate - M. Aguirre (Staff)
