Case Summary
| Case ID | 19F-H1918017-REL |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2019-04-01 |
| Administrative Law Judge | Jenna Clark |
| Outcome | loss |
| Filing Fees Refunded | $0.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Loraine Brokaw | Counsel | — |
|---|---|---|---|
| Respondent | Sin Vacas Property Owners Association | Counsel | Sean K Moynihan, Esq. and Jason E Smith, Esq. |
Alleged Violations
ARIZ. REV. STAT. § 33-1803; Bylaws Article IV, Section 6
Outcome Summary
The Administrative Law Judge denied the Petitioner's request, finding that the HOA's action to uniformly assess all CR-1 Lots (including Petitioner's two uncombined lots) adhered to the Association Bylaws, which require uniform rates, and did not violate ARS § 33-1803. The governing documents took precedence over any prior reduced assessment granted by a previous Board Order.
Why this result: Petitioner failed to prove the Association’s interpretation of the Bylaws requiring uniform assessment for all CR-1 lots was incorrect or unlawful, as her lots remained separate parcels according to the county map.
Key Issues & Findings
Whether Sin Vacas Property Owners Association (Respondent) arbitrarily and capriciously raised annual assessments for some homeowners and not others in contravention of decades of past board practice and contractual agreements.
Petitioner challenged the Association's decision to raise her assessment from 150% to 200% (full rate for two lots) based on the Association's interpretation that the Bylaws require uniform assessment rates for all CR-1 lots, arguing the new rate violated a long-standing prior Board Order (2003) granting her a reduced rate.
Orders: Petitioner’s petition is denied.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
- ARIZ. REV. STAT. § 32-2102
- ARIZ. REV. STAT. § 32-2199 et seq.
- ARIZ. REV. STAT. § 32-2199.05
- ARIZ. REV. STAT. § 32-2199(2)
- ARIZ. REV. STAT. § 32-2199.01(A)
- ARIZ. REV. STAT. § 32-2199.01(D)
- ARIZ. REV. STAT. § 32-2199.02
- ARIZ. REV. STAT. § 41-1092 et seq.
- ARIZ. REV. STAT. § 33-1803
- ARIZ. REV. STAT. § 33-1802(4)
- Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
- Bylaws Article IV, Covenant For Maintenance Assessments, Section 6
Analytics Highlights
- ARIZ. REV. STAT. § 32-2102
- ARIZ. REV. STAT. § 32-2199 et seq.
- ARIZ. REV. STAT. § 32-2199.05
- ARIZ. REV. STAT. § 32-2199(2)
- ARIZ. REV. STAT. § 32-2199.01(A)
- ARIZ. REV. STAT. § 32-2199.01(D)
- ARIZ. REV. STAT. § 32-2199.02
- ARIZ. REV. STAT. § 41-1092 et seq.
- ARIZ. REV. STAT. § 33-1803
- ARIZ. REV. STAT. § 33-1802(4)
- ARIZ. ADMIN. CODE R2-19-119
- Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
- MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
- BLACK’S LAW DICTIONARY 1220 (8th ed. 1999)
Video Overview
Audio Overview
Decision Documents
19F-H1918017-REL Decision – 698354.pdf
Briefing Document: Brokaw v. Sin Vacas Property Owners Association (Case No. 19F-H1918017-REL)
Executive Summary
This document synthesizes the findings of the Administrative Law Judge Decision in the case of Loraine Brokaw versus the Sin Vacas Property Owners Association (POA). The central conflict concerned the POA Board’s decision to increase Ms. Brokaw’s annual assessment from 150% to 200% for a single residence constructed across two separate lots.
The Petitioner, Ms. Brokaw, argued that this increase was unlawful and capricious, violating a nearly thirty-year practice that had been formalized by a 2003 Board decision granting her a reduced assessment. The POA contended that its action, taken on the advice of counsel, was necessary to comply with the Association’s governing documents, which mandate uniform assessments for all lots.
The Administrative Law Judge (ALJ) ultimately denied the homeowner’s petition. The decision established a critical legal precedent for the Association: the unambiguous language of the governing Covenants, Conditions, and Restrictions (CC&Rs) takes precedence over any past Board decisions, informal agreements, or long-standing practices, regardless of their duration. Because the Petitioner owns two distinct, legally unconsolidated lots, the ALJ found that the Board’s action to assess each lot at the full, uniform rate was not a violation, but rather a correct and required application of the community’s Bylaws.
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I. Case Overview
• Parties: Loraine Brokaw (Petitioner) vs. Sin Vacas Property Owners Association (Respondent).
• Jurisdiction: Office of Administrative Hearings (OAH), State of Arizona.
• Case Number: 19F-H1918017-REL.
• Presiding Judge: Administrative Law Judge Jenna Clark.
• Hearing Date: March 25, 2019.
• Decision Date: April 01, 2019.
II. Central Issue of the Dispute
The hearing was convened to address the following issue, as stated in the NOTICE OF HEARING:
“Whether Sin Vacas Property Owners Association (Respondent) arbitrarily and capriciously raised annual assessments for some homeowners and not others in contravention of decades of past board practice and contractual agreements based on utterly flawed legal theory, which, in fact, changed from attorney to attorney.”
The core of the dispute was the Association Board’s decision in 2017 to increase the annual assessment for the Petitioner’s property—a single home built across two adjacent lots—from 150% to 200% of the standard single-lot assessment rate. The Petitioner sought to compel the Board to revert to the 150% assessment schedule and reimburse her for costs associated with the petition.
III. Petitioner’s Position and Key Testimony
• Property History: The Petitioner testified that her husband first bought property in Sin Vacas in 1979. In 2003, the couple purchased an adjacent lot and constructed a new home that spanned across both properties (Lots 156 and 157).
• Claim of Lot Combination: The Petitioner claimed to have legally combined the two lots but presented no supporting documentation to the tribunal.
• Historical Assessment Practice: The Petitioner testified that as of 2003, the Association’s practice was to assess properties as follows:
◦ 100%: For a home on a single lot.
◦ 25%: For an undeveloped vacant lot.
◦ 150%: For a residence situated on two lots.
• 2003 Board Decision: On March 24, 2003, the Petitioner received written confirmation from the Board that it had voted to grant her a reduced assessment of 150%, formalizing the existing practice for her property.
• 2017 Assessment Change: On or about December 4, 2017, the Petitioner received a letter from the Association’s management company advising that the Board had decided to raise her assessment to 200%, citing “advice of counsel.”
• Rationale for Increase: The Petitioner stated she was given varying reasons for the change but was ultimately informed that the Board determined all plats needed to be assessed uniformly according to the Association’s governing documents. She was also told that to be assessed as a single lot, she would need to formally combine the lots on the county plat map, a process estimated to cost between $3,000 and $10,000 and require the permission of every other homeowner in the community.
IV. Respondent’s Position
The Sin Vacas Property Owners Association declined to present witnesses or exhibits. Its position at the hearing was that the dispute arose from differing interpretations of the language within the governing Bylaws. The Association’s counsel stated that the matter would be resolved based on the tribunal’s interpretation of the relevant governing texts.
V. Analysis of Governing Documents
The decision rested heavily on the interpretation of the Association’s Covenants, Conditions, and Restrictions (CC&Rs), recorded on April 13, 1978.
Document Section
Key Provision
Relevance to the Case
Bylaws Article I, Section 5
Defines a “Lot” as “any numbered lot shown upon any recorded subdivision map of the Sin Vacas Properties.”
This established that the Petitioner’s two properties, being separately numbered on the subdivision map, constitute two distinct lots for assessment purposes.
Bylaws Article IV, Section 6
“Special assessments must be fixed and apportioned at a uniform rate for all CR-1 lots, SR lots, and each 20,000 square feet of TR lots.”
This clause was central to the Judge’s decision. It establishes a clear mandate for uniformity in assessments across all lots of the same type (CR-1), which the 150% rate violated by treating two CR-1 lots differently from others.
Bylaws Article IV, Section 7
States the Board of Directors shall “fix the amount of the annual assessment against each Lot.”
This empowers the Board to set assessments but reinforces that they must do so on a per-lot basis, consistent with the uniformity requirement.
VI. Judge’s Findings and Conclusions of Law
The Administrative Law Judge made the following key determinations, leading to the denial of the petition:
• Failure to Meet Burden of Proof: The Petitioner failed to prove by a preponderance of the evidence that the Association violated community documents or Arizona statutes.
• Undisputed Material Facts: The Judge found it undisputed that:
1. The Petitioner owns two distinct CR-1 lots (Lot 156 and Lot 157).
2. The lots have never been legally combined or consolidated on the Pima County Assessor’s plat map.
3. The Petitioner’s residence is constructed across both lots.
• Primacy of Governing Documents: The central conclusion of the decision was that the Association’s governing documents supersede any past Board decisions or long-standing informal agreements. The Judge stated:
• Uniformity is Mandatory: The Bylaws require that the Association assess all developed CR-1 lots at a uniform rate. By assessing both of the Petitioner’s lots at the same full rate as every other developed CR-1 lot, the Association was found to be complying with the Declaration.
• Board’s Action as Corrective: The 2017 Board’s action was not a breach of contract or an unlawful act. Instead, it was an appropriate correction of the previous Board’s 2003 order, which was inconsistent with the Bylaws’ uniformity mandate. The Petitioner’s argument that the 2003 order should supersede the 2017 order was deemed inaccurate.
VII. Final Order
Based on the findings and legal conclusions, the Administrative Law Judge ordered that the Petitioner’s petition be denied.
The decision affirmed that the Sin Vacas Property Owners Association Board’s action to uniformly assess all CR-1 lots did not violate Arizona state law (ARIZ. REV. STAT. § 33-1803) or the Association’s Bylaws.
Study Guide: Brokaw v. Sin Vacas Property Owners Association
This guide reviews the key facts, legal arguments, and final ruling in the administrative hearing case No. 19F-H1918017-REL, Loraine Brokaw v. Sin Vacas Property Owners Association.
Short-Answer Quiz
Answer each question in 2-3 sentences, based on the provided source document.
1. Who were the primary parties involved in the hearing, and what were their respective roles?
2. What specific relief did the Petitioner request from the Office of Administrative Hearings?
3. What specific action taken by the Respondent prompted the Petitioner to file her petition?
4. Describe the assessment practice that the Sin Vacas Board had in place for the Petitioner’s property from 2003 until the change in 2017.
5. What was the Association’s stated reason for increasing the Petitioner’s assessment from 150% to 200%?
6. According to the Association’s Bylaws, what is the rule for how special assessments must be fixed and apportioned?
7. On what grounds did the Administrative Law Judge determine that the Petitioner owned two separate lots?
8. What is the legal standard of proof required in this case, and did the Petitioner successfully meet it?
9. Why did the Judge rule that the 2003 Board Order reducing the Petitioner’s assessment was not a binding contract?
10. What was the final order issued by the Administrative Law Judge in this matter?
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Answer Key
1. The primary parties were Loraine Brokaw, the Petitioner, who brought the action, and the Sin Vacas Property Owners Association, the Respondent. The case was heard by Administrative Law Judge Jenna Clark from the Office of Administrative Hearings.
2. The Petitioner requested that the Association’s Board be compelled to honor the 30-year assessment schedule and charge her the 150% assessment rate. She also requested that the Board reimburse her for the costs of bringing the petition.
3. The Petitioner filed her petition after receiving a letter on or about December 4, 2017, from the Association’s management company. This letter advised her that the Board had decided to raise her assessment from 150% to 200% based on “advice of counsel.”
4. Beginning in 2003, the Association assessed a home on a single lot at 100%, an undeveloped vacant lot at 25%, and a residence spanning two lots, like the Petitioner’s, at 150%. The Petitioner received written confirmation of her reduced 150% assessment from the Board on March 24, 2003.
5. The Association’s Board increased the assessment after determining that all plats needed to be assessed uniformly, per the Association’s Restatement. The increase was meant to bring her two lots into compliance with the governing documents.
6. Bylaws Article IV, Section 6 states that “Special assessments must be fixed and apportioned at a uniform rate for all CR-1 lots, SR lots, and each 20,000 square feet of TR lots.”
7. The Judge’s conclusion was based on the undisputed fact that the Petitioner’s two properties, Lots 156 and 157, have never been officially combined or consolidated into a single numbered lot on the Pima County Assessor’s Office plat map.
8. The required standard of proof was a “preponderance of the evidence,” which means proving a contention is more probably true than not. The Judge found that the Petitioner failed to sustain her burden of proof.
9. The Judge ruled that the 2003 Board Order was not a binding contract because the Petitioner provided no proof of consideration tendered to the Association. Therefore, the Association’s governing documents took precedence over the informal agreement.
10. The Administrative Law Judge ordered that the Petitioner’s petition be denied. The Judge concluded that the Board’s action to uniformly assess all CR-1 lots did not violate state statutes or the Association’s Bylaws.
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Essay Questions
The following questions are designed for longer, more analytical responses. No answers are provided.
1. Analyze the legal reasoning behind the Administrative Law Judge’s decision. Discuss the hierarchy of authority between the Association’s governing documents (CC&Rs) and a Board Order, as interpreted in this case.
2. Explain the concept of “burden of proof” in the context of this hearing. How did the Petitioner’s failure to meet the “preponderance of the evidence” standard lead to the denial of her petition?
3. The Petitioner’s case relied heavily on past practice and a 2003 Board decision to grant her a reduced assessment. Discuss why this argument was ultimately insufficient to overcome the explicit language of the Association’s governing documents.
4. Examine the contractual nature of a homeowners’ association’s CC&Rs as described in the Findings of Fact. How does this contractual relationship between the Association and each property owner shape the obligations and rights of both parties?
5. The Respondent (Sin Vacas POA) declined to present witnesses or exhibits, taking a passive stance at the hearing. Discuss the potential legal strategy behind this approach and how the undisputed material facts of the case made this a viable option.
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official, in this case Jenna Clark, who presides over administrative hearings, reviews evidence, makes Findings of Fact and Conclusions of Law, and issues orders.
Association
The Sin Vacas Property Owners Association, a homeowners’ association for the Sin Vacas subdivision in Tucson, Arizona, responsible for managing, maintaining, and improving the property.
Assessment
A fee levied by the Association on property owners to promote the recreation, health, safety, and welfare of residents and for the improvement and maintenance of common areas and private streets.
Bylaws
The specific articles and sections within the CC&Rs that govern the Association’s operations, including definitions, assessment rules, and voting procedures.
CC&Rs (Covenants, Conditions, and Restrictions)
The governing documents for the Association, recorded with Pima County on April 13, 1978. They form an enforceable contract between the Association and each property owner.
Department
The Arizona Department of Real Estate, which is authorized by statute to receive and decide petitions for hearings from members of homeowners’ associations.
Any numbered lot shown upon any recorded subdivision map of the Sin Vacas Properties, with the exception of the Common Area. This case deals specifically with CR-1 lots.
OAH (Office of Administrative Hearings)
An independent state agency to which the Department refers matters for evidentiary hearings. The OAH has the authority to hear and decide contested cases and interpret contracts between parties.
Petitioner
Loraine Brokaw, a property owner in the Sin Vacas subdivision and member of the Association who filed the petition against the Association.
Planned Community
A real estate development where owners of separately owned lots are mandatory members of a nonprofit association and are required to pay assessments for the purpose of managing, maintaining, or improving the property.
Preponderance of the evidence
The standard of proof required for the Petitioner to win her case. It is defined as “such proof as convinces the trier of fact that the contention is more probably true than not” and represents the greater weight of evidence.
Respondent
The Sin Vacas Property Owners Association, the entity against whom the petition was filed.
