Case Summary
| Case ID | 24F-H037-REL |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2024-08-23 |
| Administrative Law Judge | Adam D. Stone |
| Outcome | full |
| Filing Fees Refunded | $1,000.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Taylor Kidd and Jerome L. Glazer | Counsel | Patrick T. Nackley |
|---|---|---|---|
| Respondent | Heritage Village III Homeowners Association | Counsel | Tessa Knueppel and Mark K. Sahl |
Alleged Violations
McCormick Ranch CC&R Article III, Section 4 and Heritage Village III HO CC&R Article VII, Section 1
Outcome Summary
The ALJ found that the Association violated its own CC&Rs (Article VII, Section 1) by failing to incorporate and follow Article III, Section 4 of the McCormick Ranch CC&Rs, which required a two-thirds vote of voting owners for a special assessment for capital improvements. Both petitions were granted, and the Association was ordered to refund the total filing fees of $1,000.00.
Why this result: Respondent failed to take the required vote regarding the special assessment for the Landscape Improvement Project, in violation of the controlling CC&Rs.
Key Issues & Findings
Violation of CC&Rs by approving a Landscape Improvement Project and potential special assessment for a capital improvement without the required 2/3 membership vote.
The Association violated its CC&Rs by failing to follow the McCormick Ranch CC&R provision requiring the assent of two-thirds (2/3) of the votes cast by Voting Owners for a Special Assessment intended for construction, reconstruction, repair, or replacement of a capital improvement (the Landscape Improvement Project).
Orders: The petitions were granted. Respondent was ordered to reimburse both Petitioners' filing fees pursuant to ARIZ. REV. STAT. § 32-2199.02(A).
Filing fee: $500.00, Fee refunded: Yes
Disposition: petitioner_win
- McCormick Ranch CC&R Article III, Section 4
- Association CC&R Article VII, Section 1
Analytics Highlights
- ARIZ. REV. STAT. § 32-2102
- ARIZ. REV. STAT. § 32-2199 et al.
- ARIZ. REV. STAT. § 32-2199.05
- ARIZ. REV. STAT. §§ 32-2199(2), 32-2199.01(D), 32-2199.02, and 41-1092
- ARIZ. REV. STAT. § 33-1803.7
- ARIZ. REV. STAT. § 32-2199.02(A)
- ARIZ. ADMIN. CODE R2-19-119
- Title 33, Chapter 16, Article 1 of the Arizona Revised Statutes
Video Overview
Audio Overview
Decision Documents
24F-H037-REL Decision – 1182719.pdf
24F-H037-REL Decision – 1182767.pdf
24F-H037-REL Decision – 1182769.pdf
24F-H037-REL Decision – 1203525.pdf
24F-H037-REL Decision – 1215299.pdf
24F-H037-REL Decision – 1226570.pdf
Questions
Question
Can I petition the Arizona Department of Real Estate for a hearing if my HOA violates the CC&Rs?
Short Answer
Yes, owners may petition the department for hearings regarding violations of community documents or statutes regulating planned communities.
Detailed Answer
The Department has jurisdiction over disputes between owners and associations. An owner can petition for a hearing concerning violations of the community's governing documents (CC&Rs) or state statutes, provided they file the petition and pay the required fee.
Alj Quote
regarding a dispute between an owner and a planned community association, the owner or association may petition the department for a hearing concerning violations of community documents or violations of the statutes that regulate planned communities as long as the petitioner has filed a petition with the department and paid a filing fee
Legal Basis
ARIZ. REV. STAT. §§ 32-2102 and 32-2199
Topic Tags
- jurisdiction
- homeowner rights
- petition process
Question
What is the standard of proof I must meet to win a hearing against my HOA?
Short Answer
You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probably true than not.
Detailed Answer
The burden of proof lies with the petitioner (the homeowner). They must demonstrate that the violation occurred by a preponderance of the evidence, which is defined as evidence that convinces the judge that the claim is more likely true than not.
Alj Quote
Petitioner bears the burden of proving 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.'
Legal Basis
ARIZ. ADMIN. CODE R2-19-119
Topic Tags
- legal standards
- burden of proof
- evidence
Question
If my specific subdivision's CC&Rs are silent on a rule, but the Master Association's CC&Rs address it, which rules apply?
Short Answer
The Master Association's rules likely apply if your subdivision's CC&Rs reference or incorporate the Master documents.
Detailed Answer
In this case, the sub-association's CC&Rs did not explicitly require a vote for capital improvements, but the Master Association's CC&Rs did. Because the sub-association's documents contained language incorporating the Master provisions ('including but not limited to'), the Master Association's requirement for a homeowner vote applied.
Alj Quote
Based upon the foregoing, Petitioners met their burdens of proof in demonstrating that the Association was in violation the CC&R’s as it would be inconsistent to assume that only part of Article III of the McCormick Ranch’s CC&R’s would apply to the Association while Section 4 would somehow be excluded.
Legal Basis
CC&R Interpretation
Topic Tags
- CC&Rs
- master association
- governing documents
Question
Does the HOA need a homeowner vote to pass a special assessment for a capital improvement?
Short Answer
Yes, if the controlling CC&Rs require it. In this case, a 2/3 vote of voting owners was required.
Detailed Answer
The decision affirmed that the Association violated the governing documents by failing to hold a vote. The controlling Master CC&Rs specifically required approval by two-thirds of the voting owners for special assessments related to the construction, repair, or replacement of capital improvements.
Alj Quote
provided that any such assessment shall have the assent of two-thirds (2/3) of the votes cast by Voting Owners in person or by proxy at a meeting duly called for such purpose
Legal Basis
Master CC&R Article III, Section 4
Topic Tags
- special assessments
- voting rights
- capital improvements
Question
If I successfully prove my HOA violated the rules, can I get my filing fees back?
Short Answer
Yes, the Administrative Law Judge can order the HOA to reimburse the filing fees.
Detailed Answer
Upon finding that the Association violated the CC&Rs, the judge ordered the Respondent (the HOA) to reimburse the filing fees paid by the Petitioners to the Department of Real Estate.
Alj Quote
Respondent shall reimburse both Petitioner’s filing fees as required by ARIZ. REV. STAT. § 32-2199.01.
Legal Basis
ARIZ. REV. STAT. § 32-2199.01
Topic Tags
- penalties
- reimbursement
- fees
Case
- Docket No
- 24F-H037-REL, 24F-H039-REL
- Case Title
- Taylor Kidd and Jerome L. Glazer vs Heritage Village III Homeowners Association
- Decision Date
- 2024-08-23
- Alj Name
- Adam D. Stone
- Tribunal
- OAH
- Agency
- ADRE
Questions
Question
Can I petition the Arizona Department of Real Estate for a hearing if my HOA violates the CC&Rs?
Short Answer
Yes, owners may petition the department for hearings regarding violations of community documents or statutes regulating planned communities.
Detailed Answer
The Department has jurisdiction over disputes between owners and associations. An owner can petition for a hearing concerning violations of the community's governing documents (CC&Rs) or state statutes, provided they file the petition and pay the required fee.
Alj Quote
regarding a dispute between an owner and a planned community association, the owner or association may petition the department for a hearing concerning violations of community documents or violations of the statutes that regulate planned communities as long as the petitioner has filed a petition with the department and paid a filing fee
Legal Basis
ARIZ. REV. STAT. §§ 32-2102 and 32-2199
Topic Tags
- jurisdiction
- homeowner rights
- petition process
Question
What is the standard of proof I must meet to win a hearing against my HOA?
Short Answer
You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probably true than not.
Detailed Answer
The burden of proof lies with the petitioner (the homeowner). They must demonstrate that the violation occurred by a preponderance of the evidence, which is defined as evidence that convinces the judge that the claim is more likely true than not.
Alj Quote
Petitioner bears the burden of proving 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.'
Legal Basis
ARIZ. ADMIN. CODE R2-19-119
Topic Tags
- legal standards
- burden of proof
- evidence
Question
If my specific subdivision's CC&Rs are silent on a rule, but the Master Association's CC&Rs address it, which rules apply?
Short Answer
The Master Association's rules likely apply if your subdivision's CC&Rs reference or incorporate the Master documents.
Detailed Answer
In this case, the sub-association's CC&Rs did not explicitly require a vote for capital improvements, but the Master Association's CC&Rs did. Because the sub-association's documents contained language incorporating the Master provisions ('including but not limited to'), the Master Association's requirement for a homeowner vote applied.
Alj Quote
Based upon the foregoing, Petitioners met their burdens of proof in demonstrating that the Association was in violation the CC&R’s as it would be inconsistent to assume that only part of Article III of the McCormick Ranch’s CC&R’s would apply to the Association while Section 4 would somehow be excluded.
Legal Basis
CC&R Interpretation
Topic Tags
- CC&Rs
- master association
- governing documents
Question
Does the HOA need a homeowner vote to pass a special assessment for a capital improvement?
Short Answer
Yes, if the controlling CC&Rs require it. In this case, a 2/3 vote of voting owners was required.
Detailed Answer
The decision affirmed that the Association violated the governing documents by failing to hold a vote. The controlling Master CC&Rs specifically required approval by two-thirds of the voting owners for special assessments related to the construction, repair, or replacement of capital improvements.
Alj Quote
provided that any such assessment shall have the assent of two-thirds (2/3) of the votes cast by Voting Owners in person or by proxy at a meeting duly called for such purpose
Legal Basis
Master CC&R Article III, Section 4
Topic Tags
- special assessments
- voting rights
- capital improvements
Question
If I successfully prove my HOA violated the rules, can I get my filing fees back?
Short Answer
Yes, the Administrative Law Judge can order the HOA to reimburse the filing fees.
Detailed Answer
Upon finding that the Association violated the CC&Rs, the judge ordered the Respondent (the HOA) to reimburse the filing fees paid by the Petitioners to the Department of Real Estate.
Alj Quote
Respondent shall reimburse both Petitioner’s filing fees as required by ARIZ. REV. STAT. § 32-2199.01.
Legal Basis
ARIZ. REV. STAT. § 32-2199.01
Topic Tags
- penalties
- reimbursement
- fees
Case
- Docket No
- 24F-H037-REL, 24F-H039-REL
- Case Title
- Taylor Kidd and Jerome L. Glazer vs Heritage Village III Homeowners Association
- Decision Date
- 2024-08-23
- Alj Name
- Adam D. Stone
- Tribunal
- OAH
- Agency
- ADRE
Case Participants
Petitioner Side
- Taylor Kidd (petitioner)
- Jerome L. Glazer (petitioner)
Appeared on his own behalf - Patrick T. Nackley (petitioner attorney)
MEDALIST LEGAL PLC
Represented Petitioner Taylor Kidd - Brandon P. Bodea (petitioner attorney)
MEDALIST LEGAL PLC - Jack Sales (homeowner)
Co-authored a letter to the Board with Petitioner Glazer
Respondent Side
- Jennifer Hutsko (board member/witness)
Heritage Village III Homeowners Association
Director and member of the Community Planning Committee - Glenn Martyr (board member)
Heritage Village III Homeowners Association
Seconded motion in meeting minutes - Steve Wolf (board member)
Heritage Village III Homeowners Association
Seconded motion in meeting minutes - Tessa Knueppel (respondent attorney)
CHDB Law LLP
Represented Respondent at hearing - Mark K. Sahl (respondent attorney)
CHDB Law LLP
Represented Respondent at hearing - Charles H. Oldham (respondent attorney)
CHDB Law LLP - Josh Bolen (respondent attorney)
CHDB Law LLP
Neutral Parties
- Adam D. Stone (ALJ)
OAH
Conducted hearing and issued Decision - Tammy L. Eigenheer (ALJ)
OAH
Signed consolidation order - Susan Nicolson (Commissioner)
ADRE
