Case Summary
| Case ID | 19F-H1918038-REL |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2019-04-03 |
| Administrative Law Judge | Diane Mihalsky |
| Outcome | loss |
| Filing Fees Refunded | $0.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Michael Stoltenberg | Counsel | — |
|---|---|---|---|
| Respondent | Rancho Del Oro Homeowners Association | Counsel | Nicole D. Payne |
Alleged Violations
CC&Rs §§ 1.8, 1.9, 2.1, 3.1, 4.1, 4.2, 4.3, 5.1, and 14.2
Outcome Summary
The Administrative Law Judge denied the petition, concluding that the HOA acted in accordance with its governing documents (CC&Rs § 4.1) by imposing uniform assessments. The CC&Rs did not provide an exception for reduced assessments based on an owner's choice of landscaping (rock yard) or refusal of HOA maintenance services.
Why this result: Petitioner failed to meet the burden of proof that the Respondent violated its CC&Rs, as CC&R § 4.1 requires uniform assessment and no provision requires or allows Respondent to assess Petitioner less due to his rock yard and refusal of maintenance.
Key Issues & Findings
HOA Assessment Uniformity Requirement
Petitioner, who had rock landscaping and refused HOA maintenance, alleged the HOA violated CC&Rs by assessing him uniform dues, arguing he should pay less since HOA expenditures on lawn maintenance were substantial and primarily benefited neighbors with grass yards.
Orders: Petitioner's petition is denied.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
- CC&Rs § 4.1
- CC&Rs § 5.1(a)
- A.R.S. § 32-2199(B)
- A.R.S. § 33-1803
- A.R.S. § 41-1092.07(G)(2)
- Powell v. Washburn, 211 Ariz. 553
- Vazanno v. Superior Court, 74 Ariz. 369
Analytics Highlights
- A.R.S. § 32-2199(B)
- A.R.S. § 33-1803
- A.R.S. § 41-1092.07(G)(2)
- A.A.C. R2-19-119(A)
- A.A.C. R2-19-119(B)(1)
- A.A.C. R2-19-119(B)(2)
- MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
- BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999)
- Powell v. Washburn, 211 Ariz. 553, 556 ¶ 9, 125 P.3d 373, 376 (2006)
- Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
- Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs., 867 P.2d 70, 75 (Colo. App. 1993)
Video Overview
Audio Overview
Decision Documents
19F-H1918038-REL Decision – 698869.pdf
Briefing Document: Stoltenberg v. Rancho Del Oro Homeowners Association
Executive Summary
This document synthesizes the findings from the Administrative Law Judge Decision in case number 19F-H1918038-REL, concerning a dispute between homeowner Michael Stoltenberg and the Rancho Del Oro Homeowners Association (HOA). The core conflict centered on Mr. Stoltenberg’s claim that he should pay lower HOA assessments because his property has rock landscaping, while his neighbors have grass yards requiring more costly maintenance by the HOA.
The Administrative Law Judge ultimately denied the petition. The decision rested on an unambiguous interpretation of the HOA’s Covenants, Conditions, and Restrictions (CC&Rs). The Judge found that the CC&Rs explicitly obligate the HOA to maintain landscaping on all individual lots and, crucially, require assessments to be uniform for all members to cover these “common expenses.” The petitioner’s argument for a reduced assessment was unsupported by any provision in the governing documents. Furthermore, evidence showed that Mr. Stoltenberg had actively refused the HOA access to his property to install a community irrigation system and to perform the very landscaping maintenance that is a central component of the assessments.
Case Overview
• Case Number: 19F-H1918038-REL
• Parties Involved:
◦ Petitioner: Michael Stoltenberg, a homeowner at 11777 E. Calle Gaudi, Rancho Del Oro.
◦ Respondent: Rancho Del Oro Homeowners Association (HOA).
• Hearing Date: March 19, 2019
• Presiding Judge: Diane Mihalsky, Administrative Law Judge
• Core Allegation: On December 29, 2018, the Petitioner filed a petition alleging the HOA violated multiple sections of its CC&Rs (§§ 1.8, 1.9, 2.1, 3.1, 4.1, 4.2, 4.3, 5.1, and 14.2) by levying the same assessment fees on his property as on neighboring properties with grass lawns.
Petitioner’s Position and Evidence (Michael Stoltenberg)
The Petitioner’s case was built on the argument of fairness, contending that his assessment should be lower because his property does not utilize the HOA’s most expensive landscaping services.
• Primary Argument: It is inequitable for the HOA to charge him the same amount as neighbors with grass yards, given that his front yard is rock and does not receive the same level of maintenance.
• Financial Evidence: The Petitioner testified that in 2016, the HOA spent $54,000 on lawn maintenance and landscaping, which constituted 39% of its total budget.
• Refusal of Services: The Petitioner acknowledged that he refused to allow the HOA access to his property for two key purposes:
1. To install irrigation pipes connecting his lot to a new community well.
2. To perform any landscape maintenance on his front yard.
• Justification for Refusal: The Petitioner accused the HOA of previously killing his trees during maintenance activities and stated that he now undertakes all maintenance of his own yard.
Respondent’s Position and Evidence (Rancho Del Oro HOA)
The HOA’s defense was grounded in its adherence to the plain language of its governing documents, arguing that its actions were not only permissible but mandated by the CC&Rs.
• Primary Argument: The HOA is legally bound by its CC&Rs to levy uniform assessments on all members and is simultaneously obligated to maintain the landscaping on every individual lot.
• Key Testimony (Diana Crites, Property Manager):
◦ CC&R § 5.1(a) explicitly requires the HOA to maintain the yards of its members.
◦ CC&R § 4.1 requires all owners to be assessed uniformly, without regard to the type of landscaping they have chosen or whether they permit the HOA to perform its maintenance duties.
◦ The Petitioner’s property is one of eight constructed by a different developer, who did not originally install grass or an irrigation system.
◦ The HOA has since drilled a community well to address water costs and has offered to remove rock and install grass for these properties, an offer the Petitioner could accept.
• Supporting Evidence (Letter from Dawn Simpson, former bookkeeper):
◦ A 2013 HOA project was initiated to install a community well for landscaping and to connect all homes, including the Petitioner’s.
◦ The letter details an incident where the Petitioner “became very heated with [the] contractor” and “declared that no one was to enter his yard for any purpose.”
◦ This action directly halted all construction to connect his property to the irrigation system and ceased all landscaping services provided by the HOA.
Analysis of Governing Documents (CC&Rs)
The judge’s decision centered on the clear, unambiguous language of specific articles within the CC&Rs. The petitioner failed to identify any language that would permit or require a non-uniform assessment.
CC&R Section
Key Language
Implication & Ruling
Article IV, Section 4.1
Assessments “shall be used for the… common benefit… of the Owners” and “shall constitute common expenses for which the apartment owners shall be severally liable in proportion to their respective common interests.”
This establishes the principle of uniform, shared liability for common expenses, regardless of an individual owner’s specific use of a particular service.
Article V, Section 5.1(a)
“The Association shall maintain… landscaping… It shall also include maintenance of the landscaping on individual Lots outside of structures.”
This article imposes a direct obligation on the HOA to maintain all members’ landscaping, not merely an optional service.
Legal Conclusions and Final Order
• Burden of Proof: The decision established that the Petitioner, Mr. Stoltenberg, held the burden to prove by a “preponderance of the evidence” that the HOA had violated its CC&Rs.
• Interpretation of Covenants: In Arizona, unambiguous restrictive covenants are enforced to give effect to the intent of the parties. The judge found the CC&Rs to be unambiguous, requiring a holistic interpretation. The documents clearly mandate that the HOA must maintain all yards and must assess all members equally to fund that maintenance.
• Final Ruling: The Petitioner did not meet his burden of proof. He failed to point to any provision within the CC&Rs that “allows, much less requires, Respondent to assess Petitioner less because he has a rock yard and will not allow Respondent to maintain his yard.”
• Order: The petition was denied. The HOA’s practice of charging uniform assessments was upheld as compliant with its governing documents.
Study Guide: Stoltenberg v. Rancho Del Oro Homeowners Association
This guide is designed to review the key facts, legal arguments, and conclusions presented in the Administrative Law Judge Decision for case number 19F-H1918038-REL, Michael Stoltenberg v. Rancho Del Oro Homeowners Association.
Short-Answer Quiz Questions
Answer the following questions in 2-3 complete sentences, based on the information provided in the case document.
1. Who are the primary parties involved in this case, and what are their respective roles?
2. What was the central allegation in the petition filed by Michael Stoltenberg with the Arizona Department of Real Estate?
3. According to the Petitioner’s testimony, what was the financial basis for his claim of unfair assessment?
4. Describe the history of the water and irrigation system issue at the Petitioner’s property prior to 2013, as detailed in Dawn Simpson’s letter.
5. What action did the Petitioner take during the 2013 well construction project, and what were the consequences of this action?
6. According to Article V, Section 5.1(a) of the CC&Rs, what specific maintenance obligation does the homeowners’ association have regarding individual lots?
7. How did Diana Crites, the HOA’s property manager, justify the uniform assessment for all homeowners based on the CC&Rs?
8. What reason did Ms. Crites provide for why eight units, including the Petitioner’s, were originally landscaped with rock instead of grass?
9. What is the legal standard of proof required in this hearing, and on which party does the burden of proof rest?
10. What was the final order of the Administrative Law Judge, and what was the core legal reasoning for this decision?
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Answer Key
1. The primary parties are Michael Stoltenberg, the “Petitioner,” and the Rancho Del Oro Homeowners Association, the “Respondent.” Mr. Stoltenberg is a homeowner and member of the HOA who filed a complaint against the association. The Respondent is the governing HOA for the Rancho Del Oro community in Yuma, Arizona.
2. The Petitioner alleged that the Respondent violated multiple sections of its Covenants, Conditions, and Restrictions (CC&Rs). His central claim was that it was unfair for the HOA to charge him the same assessment fees as his neighbors because his property has rock landscaping, while his neighbors have grass yards that require more maintenance.
3. The financial basis for his claim was the HOA’s budget. The Petitioner testified that in 2016, the Respondent spent $54,000 on lawn maintenance and landscaping, which accounted for 39% of the total budget.
4. Prior to 2013, the Petitioner made several complaints that his home was not connected to the community water system. The HOA Board’s position was that the Petitioner knew his home was not connected to the system when he purchased it.
5. During the 2013 construction to install a well and connect all homes to an irrigation system, the Petitioner became “very heated” with the contractor. He declared that no one was to enter his yard for any purpose, which halted all construction in his backyard and all landscaping provided by the HOA for his front yard.
6. Section 5.1(a) of the CC&Rs states that the Association’s maintenance duties “shall also include maintenance of the landscaping on individual Lots outside of structures.” This obligates the HOA to maintain landscaping even on privately owned lots.
7. Diana Crites testified that CC&R Section 4.1 requires all owners to be assessed uniformly. She stated this uniformity applies regardless of the type of landscaping an owner has chosen or whether they permit the HOA onto their property to perform maintenance.
8. Ms. Crites testified that the eight units were built by a different developer after the original construction and were not equipped with an irrigation system or grass. She believed rock was used in the front yards of these lots due to the high cost of water, an issue later resolved by the installation of a community well.
9. The legal standard is “a preponderance of the evidence,” which means the evidence must be convincing enough to make the contention more probably true than not. The burden of proof to establish a CC&R violation rests on the Petitioner, Mr. Stoltenberg.
10. The Administrative Law Judge denied the Petitioner’s petition. The reasoning was that the Petitioner failed to bear his burden of proof because he could not point to any provision in the CC&Rs that allows or requires the HOA to assess him less than his neighbors based on his landscaping choice or his refusal to allow maintenance.
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Essay Questions
The following questions are designed for longer-form analysis. Formulate a detailed response for each, citing specific evidence and CC&R provisions from the case document.
1. Analyze the central conflict between the Petitioner’s concept of fairness and the Respondent’s interpretation of the CC&Rs. Use specific clauses from the CC&Rs (e.g., Articles IV and V) to support the analysis of each party’s position.
2. Discuss the significance of the “preponderance of the evidence” standard in this case. How did the evidence presented by both the Petitioner (e.g., budget figures) and the Respondent (e.g., witness testimony and CC&Rs) contribute to the judge’s final decision regarding this standard?
3. Trace the history of the water and irrigation issue at the Petitioner’s property, from his initial complaints to his refusal to allow construction access. How did these past events impact the central issue of the 2019 hearing?
4. Explain the legal principle that “restrictive covenants must be construed as a whole.” How did the Administrative Law Judge apply this principle by referencing both Section 4.1 (Assessments) and Section 5.1(a) (Maintenance) of the CC&Rs to reach her conclusion?
5. Evaluate the actions of the Petitioner, Mr. Stoltenberg. Based on the evidence presented, did his own actions—specifically, denying the HOA access to his property—undermine his legal argument for a reduced assessment? Explain your reasoning using facts from the hearing evidence.
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Glossary
Definition from Source Context
Administrative Law Judge (ALJ)
An official (Diane Mihalsky) who presides over hearings at the Office of Administrative Hearings, an independent state agency, and makes decisions in matters referred by state departments like the Arizona Department of Real Estate.
Assessments
Charges levied by the homeowners’ association on its members. According to CC&R § 4.1, they are used for promoting the recreation, health, safety, and welfare of owners, including property maintenance, and are to be proportioned to each owner’s respective common interests.
Burden of Proof
The obligation of a party in a legal case to establish their claim. In this matter, the Petitioner bears the burden of proof to establish that the Respondent violated its CC&Rs.
Common Area
Defined in CC&R § 1.8 as “those portions of the Project to which title is held by the Association for the common use and enjoyment of the Owners and excepting the individual units.”
Common Expenses
Defined in CC&R § 1.9 as the “actual and estimated expenses of operating the association,” including any reasonable reserves and all sums designated as Common Expense by project documents.
Covenants, Conditions, and Restrictions (CC&Rs)
The governing documents for a planned community that outline the rules, obligations, and rights of the homeowners and the homeowners’ association.
Easements
A right of use over the property of another. CC&R § 2.1 grants every owner a “non-exclusive easement and equitable right of use and enjoyment in, to, and throughout the Common Area.”
Homeowners’ Association (HOA)
The governing body for a planned community (Rancho Del Oro Homeowners Association) whose members are the property owners within that community. It is responsible for managing common areas and enforcing the CC&Rs.
Petitioner
The party who files a petition initiating a legal action. In this case, Michael Stoltenberg, a homeowner in Rancho Del Oro.
Preponderance of the Evidence
The evidentiary standard required to win the case. The source defines it as “such proof as convinces the trier of fact that the contention is more probably true than not” and as evidence with “the most convincing force” that is “sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”
Respondent
The party against whom a petition is filed. In this case, the Rancho Del Oro Homeowners Association.
Restrictive Covenant
A provision in a deed or community document that limits the use of the property. The source notes that in Arizona, an unambiguous restrictive covenant is enforced to give effect to the intent of the parties and must be construed as a whole.
He Sued His HOA Over an ‘Unfair’ Fee—The Reason He Lost Is a Warning for Every Homeowner
Introduction: The HOA Fee Frustration
For many homeowners, the monthly or annual bill from the Homeowners Association (HOA) can be a source of constant frustration. It’s easy to look at the line items—landscaping, pool maintenance, common area repairs—and wonder if you’re truly getting your money’s worth, especially when you feel you aren’t using a particular service.
This was exactly the position of Michael Stoltenberg, a homeowner in Arizona who believed he had an open-and-shut case to lower his HOA fees. His argument seemed logical, fair, and simple. But the ultimate ruling in his case, Stoltenberg v. Rancho Del Oro Homeowners Association, reveals some surprising and crucial truths about how HOA rules actually work and serves as a powerful lesson for every person living in a planned community.
Takeaway 1: You Pay for the Service, Even If You Actively Refuse It
Michael Stoltenberg’s argument was straightforward: his front yard was landscaped with rocks, while his neighbors had grass. He pointed out that in 2016, lawn maintenance accounted for a significant 39% of the HOA’s total budget. He argued it was fundamentally unfair for him to pay the same assessment as his neighbors when he wasn’t consuming this costly service.
His sense of unfairness was rooted in the history of the development. His home was one of eight built by a different developer than the rest of the community. Likely due to high water costs at the time, these eight lots were constructed without irrigation systems or grass. From the very beginning, his property was different. This context makes the crucial twist in the case all the more telling. In 2013, the HOA undertook a community-wide project to drill a new well and install an irrigation system, an effort designed to rectify the inconsistency and bring these outlier properties up to the community standard. When the construction reached Stoltenberg’s property, he refused the workers access.
Testimony from the HOA’s former bookkeeper laid this fact bare:
At this time, [Petitioner] declared that no one was to enter his yard for any purpose. This was also to include his front yard. This halted all construction that was currently in place in his back yard, and all landscaping being provided by the HOA for the front yard.
Legally, this transformed the situation. Stoltenberg’s complaint was no longer about a service he didn’t need, but about a service he actively rejected. This case establishes a critical principle: HOA assessments are tied to your property ownership and membership in the community, not your individual consumption of services. By refusing the service, Mr. Stoltenberg did not absolve himself of the cost associated with its availability to the community.
Takeaway 2: “Common Benefit” Isn’t the Same as “Your Personal Benefit”
The legal foundation for the HOA’s position rested in the language of its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Section 4.1 states that assessments are to be used for the “common benefit, and enjoyment of the Owners.”
In an HOA context, “common benefit” is a broad concept. It means that well-maintained landscaping throughout the entire neighborhood enhances curb appeal, creates a cohesive community aesthetic, and supports the property values of all residents. This includes Mr. Stoltenberg, whose home value is supported by the beautiful, uniform appearance of the neighborhood, regardless of whether his specific yard has grass. It’s the same reason a homeowner without children still pays for the upkeep of a community playground; the amenity benefits the community as a whole.
Further testimony reinforced this point. The HOA’s property manager stated that the association was still willing to remove the rock and install grass on his property, just as they had already done for two other homeowners in a similar situation. The benefit was available to him; he simply continued to refuse it.
Takeaway 3: The Rules Are a Package Deal, Not an A La Carte Menu
Ultimately, the Administrative Law Judge’s role was not to rule on a general sense of fairness but to enforce the community’s governing documents as written. When examined together, two key clauses in the CC&Rs created a contractual vise, leaving the judge with no other legal option. The two clauses created a perfect, inescapable loop.
• Section 5.1(a): This clause states the HOA has an obligation that “shall also include maintenance of the landscaping on individual Lots outside of structures.” The HOA wasn’t just permitted to do the work; it was contractually required to.
• Section 4.1: This clause, which also defines assessments as being for the “common benefit,” requires that they “shall constitute common expenses for which the apartment owners shall be severally liable in proportion to their respective common interests.”
The documents legally obligated the HOA to maintain all yards and to charge every owner the same proportional amount for doing so. The CC&Rs provided no mechanism for a homeowner to opt-out of a service and receive a corresponding discount. The judge’s final ruling was decisive, emphasizing the absolute nature of this contractual obligation:
Because Petitioner has not pointed to any CC&R that allows, much less requires, Respondent to assess Petitioner less because he has a rock yard and will not allow Respondent to maintain his yard, Petitioner has not borne his burden in this matter.
Conclusion: The Contract You Live In
The case of Michael Stoltenberg is a powerful reminder that an HOA’s CC&Rs are not just a set of neighborhood rules; they are restrictive covenants that run with the land. When you buy the property, you are irrevocably buying into the contract that governs it. These documents are designed to prioritize the uniform application of standards for the collective good, and they supersede an individual’s personal preferences or interpretation of what seems “fair.”
This case forces every potential buyer to ask a critical question: Are you simply purchasing a dwelling, or are you prepared to become a party to the binding legal contract that governs the entire community?
Case Participants
Petitioner Side
- Michael Stoltenberg (Petitioner)
Respondent Side
- Rancho Del Oro Homeowners Association (Respondent Entity)
Entity, not human - Nicole D. Payne (HOA Attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Represented Respondent - Diana Crites (Property Manager/Witness)
Property manager for Respondent; testified - Dawn Simpson (Former Bookkeeper/Witness)
Former bookkeeper for Respondent; provided a letter/testimony regarding history - Lydia A. Peirce Linsmeier (HOA Attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Received transmission of the Order
Neutral Parties
- Diane Mihalsky (ALJ)
- Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
Received transmission of the Order - Felicia Del Sol (Administrative Staff)
Transmitted the decision
