Briefing Document: Vinmar LLC v. Third Avenue Lofts Unit Owner Association

Executive Summary

This document provides a comprehensive analysis of the administrative hearing Case No. 25F-H013-REL between Vinmar LLC (Petitioner) and Third Avenue Lofts Unit Owner Association (Respondent). The dispute centered on whether the Association's move-in and move-out fees were permissible under Arizona law and the community's governing documents.

The proceedings, which spanned from late 2024 to early 2026, culminated in a decision by the Office of Administrative Hearings (OAH). The Petitioner alleged that the Association imposed exploitative fees and rental rules that specifically targeted and discriminated against owners who rented their units. The Respondent maintained that the fees were reasonable "user fee assessments" authorized by the Declaration of Covenants, Conditions, and Restrictions (CC&Rs) to offset administrative costs and wear and tear on common elements.

The Administrative Law Judge (ALJ) ultimately determined that while the Association's new fee structure was permissible, the previous application of a $150.00 move-out fee violated the CC&Rs in instances where no specific facility was used. Petitioner was deemed the prevailing party regarding those specific fees, and Respondent was ordered to refund the $500.00 filing fee.

Detailed Analysis of Key Themes

1. Statutory Compliance and A.R.S. § 33-1260.01

A central theme of the dispute was the interpretation of Arizona Revised Statute § 33-1260.01, which governs rental fees in condominiums.

• Petitioner’s Argument: Petitioner argued that the statute caps tenant-related fees at $25.00 for processing disclosures and prohibits any other fees that treat rental units differently than owner-occupied units.
• Respondent’s Argument: Respondent contended that move-in/move-out fees are not "rental fees" but rather universal association fees applied to any resident—owner or tenant—changing occupancy.
• Legal Conclusion: The ALJ found that the statute does not prohibit move-in/move-out fees as long as they are applied equally to all units. The evidence showed Respondent charged the same fees to owner-occupants and tenants, thus meeting the "equal treatment" requirement.

2. Contractual Authority and "Facilities"

The legality of the fees also hinged on the Association's authority under its CC&Rs.

• Facility Definitions: CC&Rs § 7.4 allows the Association to charge for the use of "certain recreational or other facilities." The ALJ identified "facilities" as items such as elevators, front-desk staffing, and security applications (e.g., Butterfly or Symmetry apps).
• The Move-Out Violation: The ALJ ruled that charging a $150.00 move-out fee was impermissible if the departing resident did not use a facility. In the case of Petitioner’s pre-furnished units, tenants often moved out with only personal luggage, requiring no elevator padding or staff assistance. Charging a facility fee when no facility was used exceeded the Board’s authority.

3. Administrative Burden vs. Wear and Tear

The Respondent justified the fees through the testimony of General Manager Michelle Collins, who outlined the administrative and physical costs of occupancy changes:

• Administrative Tasks: Staff time is required to set up new residents in the "Butterfly" building access system, the "Symmetry" garage app, and emergency communication databases.
• Physical Logistics: Moves involve the use of service elevators and loading docks. The Association provides elevator padding and performs pre- and post-move inspections of hallways to mitigate damage.
• Evolution of Fees: Over the course of the dispute, the Association adjusted its fees to be more equitable, eventually settling on a structure that distinguished between residents moving furniture and those in furnished units.

4. Allegations of Retaliation and Pattern of Conduct

The Petitioner attempted to broaden the scope of the hearing to include a "pattern of misconduct," alleging:

• Discrimination: Claims that the Board intentionally discouraged rentals.
• Amenity Access: Allegations that Respondent restricted Petitioner’s access to the pool and gym as a pressure tactic to force payment of contested fees.
• Rule Changes: Claims that a 90-day rental minimum was illegally implemented via Board vote rather than a membership vote.
• Procedural Ruling: The Tribunal limited the hearing to the single issue of move-in/move-out fees, noting that additional issues would require separate filing fees and petitions.

Important Quotes with Context

From the Petitioner (Jonathan Blangiardo)

"Essentially, a furnished property is the equivalent of someone walking in with a briefcase… It’s the equivalent of someone coming in with their groceries or a guest coming to stay for the weekend. That’s why this is different."

Context: During the September 19, 2025 hearing, Blangiardo used this analogy to argue that high move-in/out fees are unreasonable for furnished rentals, as they do not involve the heavy moving equipment or furniture that typical "moves" require.

From the Respondent's Witness (Michelle Collins)

"The $75 move-in, move-out fee if you’re utilizing the service elevator and are bringing in any type of furniture or large item. The $25 resident occupant fee is an administrative fee… It strictly covers the time to set up all of the access systems."

Context: Collins testified to the rationale behind the Association's revised fee structure, explaining the distinction between physical labor/wear-and-tear costs and administrative digital setup costs.

From the Administrative Law Judge (Samuel Fox/Nicole Robinson)

"Equal treatment is applying one rule for everyone, which is what Respondent had done. Petitioner sought equitable treatment, which would take other circumstances into account… and treat different units differently to promote fairness."

Context: Found in the final Decision (Findings of Fact 13), the ALJ clarifies the legal distinction between "equal" and "equitable," noting that while the law requires equality (treating everyone the same), it does not strictly mandate the specific fairness Petitioner requested regarding pre-furnished units.

"Specifically, it is more likely than not that one or more of the $150.00 move-out fees were charged when the individual moving out did not use any facility."

Context: This was the primary legal failure of the Association, leading to the ruling that the move-out fees were improperly applied in certain instances.

Fee Structure Summary

The following table outlines the evolution of the fees at Third Avenue Lofts as discussed in the testimony:

Actionable Insights

• Necessity of Facility Usage Linkage: For "User Fee Assessments" to remain valid under typical condominium CC&Rs, the Association must demonstrate that a facility was actually used. Associations cannot charge a flat "move-out" fee for residents who do not utilize physical facilities like elevators or loading docks.
• Distinguishing Administrative vs. Statutory Fees: The $25.00 statutory cap under A.R.S. § 33-1260.01 specifically applies to disclosures. Associations may charge separate, additional administrative fees (like a "Check-In" fee) provided they are applied equally to both owners and renters and are authorized by the CC&Rs as a fee for service/facility.
• Documentation of Intent: The Petitioner utilized internal Association communications where fees were labeled "rental fees" to argue discriminatory intent. Associations should use precise language in meeting minutes and ledgers to ensure fees are categorized by their function (e.g., "Elevator Usage Fee" or "Administrative Occupancy Setup") rather than by the resident's status.
• Filing Procedures for OAH: Petitioners must ensure that every distinct factual issue is supported by a separate filing fee. Attempting to argue "patterns of conduct" or "multiple violations" under a single $500.00 filing fee may result in the Tribunal narrowing the case to only one issue, as seen in this matter.