Assessments & CC&Rs | A.R.S. § 12-341.01 | CV2012-017609
In this Maricopa County Superior Court case, the court tried a single question to the bench: did the community’s Declaration allow The Pointe South Mountain Residential Association to spend courthome exterior-maintenance assessments on common-area landscaping, watering, and road maintenance? The court said no — reading paragraph 6.2 together with paragraph 1.15, courthome assessments may be used only to repair and maintain the courthome exteriors, including courthome balconies, trellises, patio covers, and the boundary walls enclosing courthome patios and backyards. The ruling applied prospectively, the association won the separate cable and trust issues, and the plaintiff recovered $56,000 in fees and $2,889.15 in costs as the prevailing party.
Last updated July 2, 2026. Case: Penelope Johnson v. The Pointe South Mountain Residential Association, Maricopa County Superior Court No. CV2012-017609.
Scope note: This page covers Penelope Johnson v. The Pointe South Mountain Residential Association (Maricopa County Superior Court No. CV2012-017609) as a public Arizona superior-court HOA case guide. It is built from the court’s own filed minute entries, including the July 1, 2013 oral-argument minutes, the August 12–13, 2013 bench-trial minutes, the December 11, 2013 clarification ruling, and the March 17, 2014 under-advisement ruling that entered judgment; the complete set of collected minute entries is available in the source-document index below. Currency caveat: judgment was entered under Rule 54(c) on March 17, 2014. The collected minute entries reflect no appeal, and a June 3, 2020 clerk’s notice regarding disposition of exhibits states the case “is not subject to further modification.” Superior-court rulings bind only the parties and are not precedent. This page is educational and is not legal advice.
The takeaway
After a two-day bench trial, the superior court found in the plaintiff’s favor on the central issue: the community’s Declaration did not allow the Association to spend courthome exterior-maintenance assessments on common-area landscaping, watering, and road maintenance. Reading paragraph 6.2 of the Declaration together with paragraph 1.15, the court held the courthome exterior-maintenance obligation includes repair and maintenance of all courthome balconies, trellises, patio covers, and boundary walls that enclose courthome patios and backyards — and that the Association may use courthome assessments only for repair and maintenance of the courthome exteriors as described by paragraph 6.2. The ruling operated prospectively. The Association prevailed on the separate cable and trust issues, but the court found the assessment question was the heart of the case, deemed the plaintiff the prevailing party, and awarded her $56,000 in attorneys’ fees and $2,889.15 in costs under A.R.S. § 12-341.01.
Case Participants
Petitioner Side
- Penelope Johnson (Plaintiff)
Brought the case challenging, among other things, how the Association used courthome exterior-maintenance assessments; testified at the August 2013 bench trial, prevailed on the central assessment issue, and was awarded $56,000 in attorneys’ fees plus $2,889.15 in costs. - Christopher A. LaVoy (Counsel)
Counsel for Plaintiff Penelope Johnson throughout the case, from the 2013 motion practice through the bench trial and the 2014 fee award.
Respondent Side
- The Pointe South Mountain Residential Association (Defendant)
Residential association that prevailed on the cable and trust issues and on the early partial dismissals, but was found to have misused courthome assessments on common-area expenses and ordered to discontinue the practice. Its board president, B. David Cathell, attended the November 2013 hearing as an observer. - Brian W. Morgan (Counsel)
Counsel of record for the Association in the minute-entry captions; appeared for the Association at the September 5, 2013 telephonic status conference. - Paul R. Neil (Counsel)
Counsel appearing for the Association at the July 2013 oral argument, the final trial management conference, the August 2013 bench trial, and the March 2014 fee argument. - Chad M. Gallacher (Counsel)
Counsel appearing for the Association at the August 12–13, 2013 bench trial.
Neutral Parties
- Douglas L. Rayes (Judge)
Maricopa County Superior Court judge assigned in March 2013; decided the dispositive motions, conducted the bench trial, issued the post-trial clarifications, and entered the March 2014 judgment and fee award. - John Rea (Judge)
Judge who signed the March 20, 2013 civil-presiding-judge reassignment order transferring the case to Judge Rayes after Plaintiff filed a Notice of Change of Judge. - Lisa Flores (Judge)
Judge originally assigned to the case per the March 2013 reassignment minute entry (which spells the surname “Florex” in its text and “Flores” in its caption); Plaintiff exercised a change of judge before the substantive rulings.
What happened
Penelope Johnson sued The Pointe South Mountain Residential Association in Maricopa County Superior Court in 2012 (case No. CV2012-017609). The minute entries show the litigation revolved around several distinct disputes: whether the Association could use “courthome” exterior-maintenance assessments to pay for common-area landscaping, watering, and road maintenance; a claim the minutes identify as the “cable issue,” which turned in part on what it means for units to be “separately metered and/or separately charged”; a “trust issue”; a fiduciary-duty allegation; and a claim for injunctive relief.
The early rounds went to the Association. In February 2013 it moved for partial dismissal of the fiduciary-duty allegations and of the claim for injunctive relief. After Johnson exercised a change of judge and the case was reassigned to Judge Douglas L. Rayes, the court granted both partial motions on April 11, 2013 — striking the words “and fiduciary capacity” from Paragraph 63(e) of the complaint — while denying the Association’s request for attorneys’ fees. In May 2013 the court also struck Johnson’s application for entry of default, again denying the Association’s fee request.
Both sides then moved for partial summary judgment, and Johnson sought a preliminary injunction. At a July 1, 2013 oral argument the court denied the preliminary injunction, granted the Association partial summary judgment on the trust issue, and denied the balance of both summary-judgment motions — except the courthome exterior-maintenance issue, which it reserved for trial. The Association’s cross-motion on the cable issue was taken under advisement and, at the August 1, 2013 final trial management conference, both sides’ cable-issue motions were denied, sending that question to trial as well.
The court held a two-day bench trial on August 12–13, 2013. Witnesses included Mike P. Harris, Kathleen Daurio, Steven J. Schloeder, and Johnson herself for the plaintiff’s case, and Kenneth Hensman, Barry Smith, and Guilford Nergard in the defense case; Harris was recalled to the stand on day two, and plaintiff’s counsel — limited at the pretrial conference to calling one Gosnell witness — was permitted to call Stuart “Steve” Berres out of order during the defense case. At the close of trial, for reasons stated on the record, the court found in favor of the Association on the cable issue and in favor of Johnson on the courthome exterior-maintenance issue, and directed each side to submit proposed findings of fact and conclusions of law on the issue it had won.
The remedy was refined over the following months. At a September 5, 2013 telephonic conference the court clarified that its ruling was intended “to stop and move forward prospectively,” observed that starting the assessment changes on January 1, 2014 “makes sense,” and directed the parties to mediate the start date and amounts. At a November 22, 2013 hearing — attended by the Association’s board president as an observer — the court ruled on objections to Johnson’s proposed findings, defined “separately metered and/or separately charged” as when each unit is metered separately and charged an individual amount, and clarified that its earlier use of the phrase “good faith” was a term of art rather than a legal finding. On December 11, 2013 the court issued its written clarification: paragraph 6.2 of the Declaration, read with paragraph 1.15, makes the courthome exterior-maintenance obligation include repair and maintenance of all courthome balconies, trellises, patio covers, and boundary walls that enclose courthome patios and/or backyards — and the Association may use courthome assessments only for repair and maintenance of the courthome exteriors as described by paragraph 6.2.
Both sides then moved for attorneys’ fees. In its March 17, 2014 under-advisement ruling, the court acknowledged that each party had prevailed on some claims, but found the heart of the case was whether the Declaration allowed courthome assessment fees to pay common-area landscaping, watering, and road-maintenance expenses — an issue Johnson won, with the Association ordered to discontinue the misuse of the courthome assessments. Applying the factors in Associated Indemnity Corporation v. Warner, the court granted Johnson’s fee motion under A.R.S. § 12-341.01, awarded her $56,000 in fees and $2,889.15 in costs, denied the Association’s fee motion, overruled its objection to the form of judgment, and entered judgment under Rule 54(c). A June 2020 clerk’s notice on exhibit disposition states the case is not subject to further modification.
Procedural timeline
Complete uploaded source-document index
This index is generated from every public-facing source file currently present in assets/court_case_downloads/penelope-johnson-v-pointe-south-mountain-residential-association/raw/: 21 PDFs. Files are ordered by the date/sequence embedded in the normalized filename; AI-generated review materials are labeled separately and should not be treated as court filings.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Ruling
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Ruling
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Under Advisement Ruling
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Ruling
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Oral Argument Set
Type: Court/source PDF
Uploaded source file in the case record; read it in sequence with the surrounding filings to follow the procedure.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Under Advisement Ruling
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
Minute Entry
Type: Court order/minute entry
Court or agency order; this is usually the document that tells readers what changed next.
FAQ
What was the “courthome exterior maintenance issue” at the center of this case?
It was the question the court itself called the heart of the case: whether the community’s Declaration allowed the Association to use courthome exterior-maintenance assessments to pay common-area landscaping, watering, and road-maintenance expenses. After the August 2013 bench trial, the court answered no and ordered the Association to discontinue the misuse. Its December 2013 written clarification held that paragraph 6.2 of the Declaration, read with paragraph 1.15, limits courthome assessments to repair and maintenance of the courthome exteriors — including courthome balconies, trellises, patio covers, and the boundary walls that enclose courthome patios and backyards.
Did the plaintiff win everything?
No — the case split. The court dismissed her fiduciary-duty allegation and her claim for injunctive relief early on, struck her application for entry of default, denied her preliminary-injunction motion, granted the Association partial summary judgment on the trust issue, and found for the Association on the cable issue at trial. But she won the courthome-assessment issue that the court found most significant, and on that basis recovered her fees and costs.
Did the ruling require the Association to refund past assessments?
The minute entries do not show a refund order. At a September 2013 conference the court clarified that the intention of its ruling was “to stop and move forward prospectively,” said that beginning the change in assessments on January 1, 2014 “makes sense,” and directed the parties to mediate the beginning date and amounts — recommending a mediator if they could not agree on one.
Why did the plaintiff get attorneys’ fees when both sides won issues?
Arizona’s contract fee statute, A.R.S. § 12-341.01, lets the court award fees to the successful party. The court acknowledged both parties prevailed on some claims, but looked at the totality of the litigation and found the most significant issue — whether courthome assessments could fund common-area landscaping, watering, and road maintenance — went to the plaintiff. Applying the factors from Associated Indemnity Corporation v. Warner, it awarded her $56,000 in fees and $2,889.15 in costs and denied the Association’s competing fee motion.
What were the “cable issue” and the “trust issue”?
The minute entries identify these disputes only by those shorthand labels. Both sides moved for summary judgment on the cable issue, both motions were denied, and the court found for the Association on it at trial; when plaintiff’s counsel later asked, the court defined “separately metered and/or separately charged” as when each unit is metered separately and each unit is charged an individual amount. The trust issue was resolved in the Association’s favor on partial summary judgment in July 2013. The underlying details of both issues live in the trial record rather than the minute entries.
Is this decision binding on other Arizona HOA disputes?
No. Superior-court rulings bind only the parties to the case and are not precedent. The case is still useful reading: it shows a court tracing an association’s spending authority to the specific text of its recorded Declaration, limiting a dedicated assessment to its stated purpose, and using prevailing-party fee-shifting under A.R.S. § 12-341.01 to decide who bears the cost of a mixed-outcome case. Judgment was entered in March 2014, and the collected minute entries reflect no appeal.
Case Dossier
This generated dossier mirrors the structured data surfaced on the OAH/ADRE case pages. It is added from the curated court-case record and the custom page source package, while the hand-authored analysis below remains intact.
Case Summary
| Case ID / citation | CV2012-017609 (Maricopa County Superior Court) |
|---|---|
| Court / tribunal | Superior Court |
| Decision / key date | March 17, 2014 |
| Judge / panel | Hon. Douglas L. Rayes |
| Parties | Penelope Johnson (Plaintiff) v. The Pointe South Mountain Residential Association (Defendant) |
| Governing law | |
| Topics | assessmentscc-and-rsattorneys-feesprocedure |
| Outcome / holding | After a bench trial, the court held that the Declaration did not permit the Association to use courthome exterior-maintenance assessments for common-area landscaping, watering, and road maintenance: paragraph 6.2, read in conjunction with paragraph 1.15, makes the courthome exterior-maintenance obligation include repair and maintenance of all courthome balconies, trellises, patio covers, and boundary walls enclosing courthome patios and/or backyards, and the Association may use courthome assessments only for repair and maintenance of the courthome exteriors as described by paragraph 6.2. The court found for the Association on the cable issue, applied its assessment ruling prospectively, and — finding Johnson the prevailing party on the most significant issue — awarded her $56,000 in fees and $2,889.15 in costs under A.R.S. § 12-341.01. |
| Primary public source | View source opinion/order |
Parties, Court, and Research Coverage
| Uploaded source package | 21 PDFs |
|---|---|
| Step-by-step docket roadmap | 16 roadmap entries |
| Video overview | No video embed currently configured |
| Study / briefing material | 1 section |
| FAQ / homeowner questions | 6 questions |
| Curated download aliases | 1 download link |
Key Issues & Findings
Penelope Johnson sued The Pointe South Mountain Residential Association in Maricopa County Superior Court in 2012 over, principally, the Association’s use of courthome exterior-maintenance assessments to pay common-area landscaping, watering, and road-maintenance expenses; the litigation also included a “cable issue,” a “trust issue,” a fiduciary-duty allegation, and a claim for injunctive relief. The Association won the early rounds — partial dismissal of the fiduciary-duty and injunctive-relief claims, denial of a preliminary injunction, and partial summary judgment on the trust issue — and the court reserved the courthome-assessment and cable issues for a two-day bench trial held August 12–13, 2013. At trial the court found for the Association on the cable issue and for Johnson on the courthome exterior-maintenance issue, later clarifying in writing that Declaration paragraph 6.2, read with paragraph 1.15, limits courthome assessments to repair and maintenance of the courthome exteriors, and that the ruling operated prospectively. In its March 17, 2014 under-advisement ruling the court found Johnson the prevailing party on the heart of the case, awarded her $56,000 in attorneys’ fees and $2,889.15 in costs under A.R.S. § 12-341.01, denied the Association’s fee motion, and entered judgment under Rule 54(c).
The case was litigated issue by issue. The Association prevailed throughout the pretrial phase: in April 2013 the court granted partial dismissal of Johnson’s fiduciary-duty allegation (striking “and fiduciary capacity” from Paragraph 63(e) of the complaint) and of her claim for injunctive relief; in May 2013 it struck her application for entry of default; and on July 1, 2013 it denied her preliminary-injunction motion and granted the Association partial summary judgment on the trust issue. But the court refused to resolve the central dispute on paper — it denied both sides’ partial summary-judgment motions as to the courthome exterior-maintenance issue and, after taking the Association’s cable-issue cross-motion under advisement, denied both cable motions as well, sending both questions to a two-day bench trial.
At the close of trial on August 13, 2013, the court found for the Association on the cable issue and for Johnson on the courthome exterior-maintenance issue, directing each side to submit proposed findings on the issue it won. The remedy took shape through post-trial clarifications: the ruling was intended “to stop and move forward prospectively,” with the court observing that a January 1, 2014 start for the assessment changes made sense and directing mediation over dates and amounts. The December 11, 2013 written clarification supplied the interpretive core — paragraph 6.2 of the Declaration, read in conjunction with paragraph 1.15, requires the courthome exterior-maintenance obligation to include repair and maintenance of all courthome balconies, trellises, patio covers, and boundary walls that enclose courthome patios and/or backyards, and the Association may only use courthome assessments for the repair and maintenance of the exterior of the courthomes as described by paragraph 6.2. The court also defined “separately metered and/or separately charged” as when each unit is metered separately and each unit is charged an individual amount, and clarified that its earlier use of “good faith” was a term of art, not a legal finding.
On the cross-motions for fees, the court acknowledged that both parties prevailed on some claims and lost others, but considered the totality of the litigation and found the most significant issue — the heart of the case — was whether the Declaration provided for courthome assessment fees to be used to pay common-area landscaping, watering, and road-maintenance expense. Because it had ruled in Johnson’s favor on that issue and ordered the Association to discontinue the misuse of the courthome assessments, and after weighing the factors in Associated Indemnity Corporation v. Warner, 143 Ariz. 567 (1985), the court granted Johnson’s fee motion under A.R.S. § 12-341.01, awarded $56,000 in fees and $2,889.15 in costs, denied the Association’s fee motion, and entered judgment under Rule 54(c) on March 17, 2014.
This case is a clean illustration of purpose-restricted assessments: when a recorded declaration dedicates an assessment to a particular function — here, courthome exterior maintenance — the association cannot redirect that money to general common-area expenses like landscaping, watering, and road maintenance. The court traced the association’s spending authority to the specific text of the Declaration (paragraph 6.2 read with paragraph 1.15) and confined the assessment to its stated purpose, ordering the misuse discontinued on a prospective basis.
It also shows how prevailing-party fee-shifting works in a mixed-outcome HOA case. The association won the fiduciary-duty and injunctive-relief dismissals, the trust issue, and the cable issue — yet still ended up paying the homeowner-side plaintiff $56,000 in fees plus costs, because the court weighed the totality of the litigation and found the assessment question was the heart of the case. Under A.R.S. § 12-341.01 and the Associated Indemnity v. Warner factors, winning the issue that matters most can matter more than winning the most issues. As a superior-court decision it binds only the parties; the collected minute entries reflect no appeal.