2024-03-08 — VISTA DEL CORAZON HOMEOWNERS ASSOCIATION, AN ARIZONA NON-PROFIT CORPORATION, Plaintiff/Counter-Defendant/Appellee, v. DEANNA SMITH AND MYCHAL A. KINTZ, Defendants/Counter-Claimants/Appellants ↑ top

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vista-del-corazon-v-smith-kintz.pdf

IN THE
ARIZONA COURT OF APPEALS
DIVISION TWO

VISTA DEL CORAZON HOMEOWNERS ASSOCIATION,
AN ARIZONA NON-PROFIT CORPORATION,
Plaintiff/Counter-Defendant/Appellee,

v.

DEANNA SMITH AND MYCHAL A. KINTZ,
Defendants/Counter-Claimants/Appellants.

No. 2 CA-CV 2023-0071
Filed March 8, 2024

Appeal from the Superior Court in Pinal County
No. S1100CV202200011
The Honorable Joseph R. Georgini, Judge

VACATED AND REMANDED

COUNSEL

Carpenter, Hazlewood, Delgado & Bolen LLP, Tempe
By Alexis G. Firehawk and Ember Van Vranken
Counsel for Plaintiff/Counter-Defendant/Appellee

Dessaules Law Group, Phoenix
By Jonathan A. Dessaules and Ashley C. Hill
Counsel for Defendants/Counter-Claimants/Appellants

VISTA DEL CORAZON HOMEOWNERS ASS’N v. SMITH & KINTZ
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MEMORANDUM DECISION

Presiding Judge Brearcliffe authored the decision of the Court, in which
Judge Kelly concurred and Judge Eckerstrom concurred in part and
dissented in part.

B R E A R C L I F F E, Presiding Judge:

¶1
Deanna Smith and Mychal Kintz appeal from a permanent
injunction in favor of the Vista Del Corazon Homeowners Association (“the
HOA”) which compels their compliance with the HOA’s amended
Declaration of Covenants, Conditions, Restrictions, and Grant of Easements
(“CC&Rs”). Smith and Kintz contend the superior court erred in
concluding the HOA had validly adopted amendments to the CC&Rs.
Because we conclude that certain of the amendments to the CC&Rs were
invalid, we vacate the injunction and remand for further proceedings.
Factual and Procedural Background
¶2
Vista Del Corazon is a planned residential community in
Pinal County, Arizona. Smith and Kintz have owned a home (Lot 89)
within the community since 2020. Properties within Vista Del Corazon,
including Smith and Kintz’s, are subject to the CC&Rs first adopted in 1997.
Since purchasing the home, Smith and Kintz have leased it out from time
to time for short terms, that is, for periods of less than ninety consecutive
days.
¶3
In February 2021, the HOA, through a letter from its board,
notified members of the community that it had learned of “short term rental
activity occurring in the Vista Del Corazon community,” which had been
“the source of noise and other complaints in the past.” The board explained
that it had examined the current restrictions on rental activity in the CC&Rs
and had been “surprised to discover that this type of use is not currently
prohibited.” The HOA declared that it “would like to amend the CC&Rs to
expressly state that any rental in Vista Del Corazon must be for a minimum
duration of not less than ninety (90) consecutive days.”
¶4
Before the amendments that are the subject of this case, the
CC&Rs contained only two provisions regarding renting or leasing of
homes within the community. Section 4.18 excepted rental activity from
the general prohibition against an owner conducting a “trade or business”
on a property. And § 4.22 required any such lease to be of the entire lot
(with its improvements), and the homeowner to provide the names of any

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lessees to the HOA, and to remain liable for a lessee’s compliance with the
CC&Rs.
¶5
As planned, the HOA purported to amend the CC&Rs in 2021
by repealing § 4.22 and adopting §§ 4.22.1 through 4.22.5 (“2021
amendments”), after receiving many homeowners’ written approval but
without a formal association meeting and vote. The 2021 amendments
covered various uses pertaining to rental activity, including the prohibition
of “short-term rentals”—defined as rental periods of less than ninety
days—and a related prohibition against advertising or offering any lot for
short-term rent. As required by the CC&Rs, the 2021 amendments were
recorded in Pinal County. The HOA also updated its enforcement policy
to adopt a special fine structure for violation of the new short-term rental
restrictions.
¶6
While the parties dispute the extent of Smith and Kintz’s
short-term rental activities during the relevant times, it is undisputed that
the HOA began fining Smith and Kintz for claimed violations following the
adoption of the 2021 amendments. Ultimately, the HOA filed a complaint
to enforce the amended CC&Rs, collect the accrued fines, and enjoin Smith
and Kintz from further violations. Smith and Kintz filed a counterclaim
challenging the validity of the adoption of the 2021 amendments, seeking
both a declaratory judgment voiding them and an injunction against their
enforcement. In their counterclaim, Smith and Kintz asserted the
amendments had been improperly adopted because the HOA failed to
obtain the percentage of votes required to amend the CC&Rs without a
meeting under Arizona law and the CC&Rs.
¶7
After a settlement conference, the parties stipulated to stay
the proceedings so that the HOA could conduct a re-vote among HOA
members on the amendments. The re-vote was held in April 2022, and
eighty percent of the HOA members voted for the amendments (“2022
amendments”). Following their certification by the HOA president on
April 28, 2022, the 2022 amendments were first erroneously recorded in
Maricopa County on May 2, 2022, but later properly recorded in Pinal
County on August 11, 2022.
¶8
After the HOA adopted the 2022 amendments, the parties
amended their pleadings. The HOA’s amended complaint alleged the 2022
amendments were valid and enforceable; Smith & Kintz’s amended
counter-claim asserted they were not. The parties also filed competing
motions for partial summary judgment.
¶9
Smith and Kintz’s motion relied on this court’s opinion in
Dreamland Villa Cmty. Club, Inc. v. Raimey, 224 Ariz. 42 (App. 2010), and our

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supreme court’s opinion in Kalway v. Calabria Ranch HOA, LLC, 252 Ariz.
532, ¶ 14 (2022), in which it endorsed Dreamland and held that “an HOA
cannot create new affirmative obligations where the original declaration
did not provide notice to the homeowners that they might be subject to such
obligations.” Smith and Kintz argued that unanimous approval by HOA
members was necessary because the 2022 amendments created “entirely
new use restrictions” not found in the original CC&Rs. They further argued
that, even if valid under Kalway, the 2022 amendments were invalid because
the HOA had failed to timely record them in the proper county.
¶10
In its motion, the HOA asserted that unanimous approval was
not required because it is “manifestly unjust” for owners of one lot to “veto
the vote of the community” and the 2022 amendments were passed
pursuant to the CC&Rs’ amendment provision. The HOA argued that
Kalway was inapplicable because that case did not involve a short-term
rental amendment, many more homeowners voted in favor of the 2022
amendments than did for those in Kalway, and the Arizona legislature
implicitly rejected Dreamland’s holding by subsequent legislation. Even if
Kalway did apply, the HOA asserted, the original CC&Rs contained a
restriction on the rental of lots so the 2022 amendments permissibly
“refine[]s the restriction,” “fill[]s in a gap,” and “clarif[y] that short term
rentals are not consistent with the Single Family [Residential Use]
restrictions and the ban on commercial use.” Finally, the HOA argued that
it had strictly complied with the requirement to record the 2022
amendments within thirty days and that erroneously recording the 2022
amendments in Maricopa County had not rendered them invalid because
it was a clerical error that was cured by recording in the proper county. In
any event, the HOA asserts, Smith and Kintz had actual notice of the
amendments.
¶11
The superior court granted the HOA’s motion for partial
summary judgment and denied Smith and Kintz’s. Although Smith and
Kintz appealed from the denial of their motion, we dismissed that appeal
for lack of jurisdiction because the order was not certified as final. After the
grant of its motion for partial summary judgment, the HOA moved for
immediate entry of a permanent injunction to compel Smith and Kintz’s
future compliance with each provision of the 2022 amendments. The court
granted the motion for permanent injunction and further ordered Smith
and Kintz to “immediately cease advertising and renting the Property for
short term rentals of less than 90 days.” The court also awarded the HOA
its attorney fees and costs relating to the motion for permanent injunction.
Smith and Kintz appealed from the court’s permanent injunction order.

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Jurisdiction and Scope of Review
¶12
Although neither party asserts that we lack jurisdiction over
this appeal, “we have an independent duty to confirm whether we have
jurisdiction over the case before us.” Santee v. Mesa Airlines, Inc., 229 Ariz.
88, ¶ 2 (App. 2012). “Our jurisdiction is provided and limited by statute.”
Id.; see A.R.S. § 12-2101. While Smith and Kintz properly appealed from the
superior court’s order granting the injunction, see § 12-2101(A)(5)(b), they
also ask us to review the court’s underlying grant of the HOA’s motion for
partial summary judgment and the denial of theirs. However, the appeal
of that ruling was dismissed for lack of an appealable judgment, see § 12-
2101(A)(1) (appeal may be taken from final judgment), which has yet to be
remedied. See Ariz. R. Civ. P. 54. Consequently, we continue to lack
jurisdiction over the partial summary judgment rulings.
¶13
Nonetheless, even though this court generally reviews an
injunction order for an abuse of discretion, when the superior court’s
exercise of discretion rests on an interpretation of the law rather than on the
facts, “the appellate court is not as limited in its review and may reverse if
it feels that the lower court’s view of the law was erroneous.” Reiswig v. St.
Joseph’s Hosp. & Med. Ctr., 130 Ariz. 164, 167 (App. 1981) (quoting 11 Wright
& Miller, Federal Practice and Procedure, Civil § 2962 (2023)). The permanent
injunction here is premised on the court’s legal conclusion, in its ruling on
the motions for partial summary judgment, that the 2022 amendments are
valid and enforceable. The propriety of the entry of the injunction is
therefore “inextricably bound up” with that conclusion. Id. As a
consequence, we must consider the court’s underlying legal conclusion on
the validity of the 2022 amendments even though we do not have
jurisdiction to review that summary judgment ruling itself.1 See id.; see also
Smith v. Coronado Foothills Ests. Homeowners Ass’n Inc., 117 Ariz. 171, 172
(1977) (permanent injunctions issued after “decision on the merits”).
Similarly, we may not address Smith and Kintz’s claim as to any mis-
recording of the 2022 amendments in Maricopa County. Such may
appropriately be addressed in further proceedings on remand or in any

1The superior court’s order granting a permanent injunction is
sparse and contains no findings of fact or legal conclusions other than that
it “considered the allegations” within the HOA’s motion for permanent
injunction. See Ariz. R. Civ. P. 65(d)(1) (“Every order granting an injunction
. . . must: (A) state the reasons why it issued . . . .” (emphasis added)). It is
clear that the permanent injunction order is tied to its earlier conclusion that
the 2022 amendments are valid and enforceable, as it relied on the HOA’s
motion advocating the same and ordered compliance with the
amendments’ provisions.

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appeal of the summary judgment rulings. Even so, we have jurisdiction
pursuant to § 12-2101(A)(5)(b).
Discussion
I.
Permanent Injunction
¶14
As stated above, we review a superior court’s order granting
a permanent injunction for abuse of discretion, Kromko v. City of Tucson, 202
Ariz. 499, ¶ 4 (App. 2002), and defer to the court’s factual findings unless
clearly erroneous, while reviewing its legal conclusions de novo, McNally
v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, ¶ 11 (App. 2016). A court
that “commits an error of law” in granting an injunction has abused its
discretion. Id.; see also TP Racing, L.L.L.P. v. Simms, 232 Ariz. 489, ¶ 8 (App.
2013).
¶15
In reviewing the grant of an injunction, we interpret CC&Rs
and statutes, as well as the superior court’s interpretation thereof, de novo.
Cypress on Sunland Homeowners Ass’n v. Orlandini, 227 Ariz. 288, ¶¶ 30-31
(App. 2011). As to CC&Rs, they “are generally enforced as written,” and
“we interpret such restrictions to reflect the reasonable expectations of the
affected homeowners” while “[c]onstruing such provisions narrowly.”
Kalway, 252 Ariz. 532, ¶ 1. In interpreting a statute, we rely on the statute’s
plain meaning. See State ex rel. Ariz. Dep’t of Revenue v. Tunkey, 254 Ariz.
432, ¶¶ 31-32 (2023) (Bolick, J., concurring); Roberts v. State, 253 Ariz. 259,
¶ 20 (2022) (“[C]ourts will not read into a statute something which is not
within the manifest intention of the legislature as gathered from the statute
itself,” and “will not inflate, expand, stretch or extend a statute to matters
not falling within its expressed provisions.” (quoting City of Phoenix v.
Donofrio, 99 Ariz. 130, 133 (1965)). Our analysis extends to both substantive
provisions and enforcement methods alike. See Kalway, 252 Ariz. 532,
¶¶ 18-41 (addressing a wide array of provisions, striking all but one for lack
of notice).
A. Kalway’s Applicability
¶16
The superior court determined, on several bases, that our
supreme court’s decision in Kalway does not apply and that the 2022
amendments were valid. First, the court determined that the legislature
had rejected Dreamland—the case Kalway affirmed and built upon—by
enacting A.R.S. § 33-1806.01(A), and thereby directly “authorized
amendments that establish rental time period restrictions.” This statute,
however, did no such thing.

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¶17
In relevant part, § 33-1806.01(A) states that “[a] member” of a
homeowners’ association “may use the member’s property as a rental
property unless prohibited in the declaration and shall use it in accordance
with the declaration’s rental time period restrictions.” Such language
actually ensures the right to lease one’s property but in accord with validly
imposed restrictions—it does not itself create an unfettered right of HOAs
to prohibit or restrict the time period of rentals and create related
restrictions. It certainly does not do so in derogation of the common law
limitation on amendments to CC&Rs as recognized in Dreamland, 242 Ariz.
42, ¶ 38, and affirmed in Kalway, 252 Ariz. 532, ¶ 14. See also Pleak v. Entrada
Prop. Owners’ Ass’n, 207 Ariz. 418, ¶ 12 (2004) (statutes and common law
are read as consistent with each other unless express or necessary
implication that legislature intended to change or abrogate common law by
statute); A.R.S. § 1-201.
¶18
Based on its misunderstanding that § 33-1806.01 abrogated
Dreamland and explicitly authorized the HOA to impose rental time period
restrictions, the superior court incorrectly concluded that the amendments
were validly adopted because the HOA followed proper procedures as
outlined in A.R.S. § 33-1817(A)(1) and § 12.2 of the CC&Rs. But the fact that
the HOA technically complied with the CC&Rs’ amendment procedures as
required by § 33-1817(A)(1) is not alone dispositive. While § 33-1817(A)(1)
permits amendments to CC&Rs “by an affirmative vote or written consent
of the number of owners or eligible voters specified in the declaration,”
Kalway explains that, notwithstanding § 33-1817(A), the common law
requires the unanimous consent of affected property owners unless the
CC&Rs “give sufficient notice of the possibility of a future amendment.”
252 Ariz. 532, ¶¶ 10, 36, 39. Unless such proposed amendments are
“reasonable and foreseeable” from the existing CC&Rs, “even a broad grant
of authority to amend an original declaration is insufficient to allow a
majority of property owners to adopt and enforce restrictions on the
minority without notice.” 2 Id. ¶¶ 10, 13.
¶19
Finally, the superior court also incorrectly felt free of Kalway
because that case did not address rental restrictions, and many more
members voted in favor of the amendments here than had those in Kalway.
But the fact that Kalway did not explicitly address rental restrictions, or that
a significant number of members in the community here voted in favor of

2Of course, this is not to say that the CC&Rs’ amendment provision
is irrelevant. See § 33-1817(A). For example, a “reasonable” and
“foreseeable” amendment would still be invalid if the HOA failed to abide
by the CC&Rs’ amendment procedures or if the votes-in-favor fell below
the minimum threshold required by the amendment provision. Id.

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the amendments, does nothing to except this case from Kalway’s reach. Our
supreme court broadly explained that “[t]he law will not subject a minority
of landowners to unlimited and unexpected restrictions on the use of their
land merely because the covenant agreement permitted a majority to make
changes to existing covenants.” Id. ¶ 15 (quoting Boyles v. Hausmann, 517
N.W.2d 610, 617 (Neb. 1994) (alteration in Kalway)). Nothing in Kalway
limited its reach to only certain kinds of property restrictions, or to
amendments adopted by bare versus vast majorities.
¶20
Each of the superior court’s bases for refusing to apply Kalway
was in error. Kalway controls and, regardless of whether it follows proper
procedures in doing so, “an HOA cannot create new affirmative obligations
where the [CC&Rs] did not provide notice to the homeowners that they
might be subject to such obligations.” Id. ¶ 14. We can determine the
reasonable foreseeability, and thus enforceability, of amendments de novo.
See id. ¶¶ 8-9, 18 (conducting de novo review of amendments’ validity); cf.
In re Estate of Snure, 234 Ariz. 203, ¶¶ 5-7 (App. 2014) (question of adequate
notice reviewed de novo).
B. Reasonable Foreseeability
¶21
For the 2022 amendments to be valid as “reasonable and
foreseeable” under the existing CC&Rs, the CC&Rs “must give notice that
a restrictive or affirmative covenant exists and that the covenant can be
amended to refine it, correct an error, fill in a gap, or change it in a particular
way.” Kalway, 252 Ariz. 532, ¶¶ 10, 17. This is an objective inquiry. Id. ¶ 16.
First we look to the original CC&Rs’ general amendment provision and its
general-purpose statement to determine if sufficient notice is provided
there. See id. ¶¶ 18-21. If not, then we review each challenged amendment
individually and assess whether the CC&Rs “put a property owner on
notice that the Other Owners could, by majority vote,” impose the new
restriction. Id. ¶¶ 21-22.
1. General Amendment and Purpose Provisions
¶22
The HOA first relies on § 12.2 of the CC&Rs which provides
the general amendment power:
Except as provided in Sections 12.3 and 12.4
below, this Declaration may be amended at any
time only by the written approval or affirmative
vote, or any combination thereof, of Members
holding not less than seventy-five percent (75%)
of the votes in each class of Membership in the
Association. Any amendment approved

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pursuant to this Section 12.2 shall be signed by
the President or Vice President of the
Association and shall be Recorded, and any
such
amendment
shall
certify
that
the
amendment has been approved as required by
this Section.
Although the HOA is correct that this section provides that amendments
may generally be adopted with the approval of seventy-five percent of the
HOA’s members, nothing in this general language is sufficient to provide
the needed “fair notice” that new restrictions on rental activity, or indeed
any particular new restriction, could be imposed. See id. ¶ 19.
¶23
The HOA further argues that two general purpose recitals
and a definition of “Declaration” rendered the 2022 amendments
reasonably foreseeable. The first recital states, in relevant part, that the
declarant seeks to “establish a flexible and reasonable procedure for [the
Property’s] overall development, administration, maintenance and
preservation.” The second recital generally states that purchasers of a lot
are subject to the CC&Rs. Finally, “Declaration” is defined as “this
Declaration of Covenants, Conditions, Restrictions and Grant of Easements,
as amended or supplemented from time to time as permitted herein.” As
recognized in Kalway, such general intent or general purpose provisions do
not sufficiently signal that particular new land-use restrictions can be
imposed. See id. ¶ 20 (refusing to rely “solely upon a subjective general
statement of purpose” that “would provide limitless justification for new
amendments”). Those here certainly do not.
¶24
Because nothing identified by the HOA in the amendment
provision, recitals, or definition provides notice that the HOA could amend
the declaration in any particular way, we review each challenged
amendment individually to determine if it is “‘entirely new and different in
character,’ untethered to an original covenant.” Id. ¶ 17 (quoting Lakeland
Prop. Owners Ass’n v. Larson, 459 N.E.2d 1164, 1167 (Ill. App. 1984)). In
Kalway, our supreme court applied “the blue pencil rule” to strike out
unauthorized amendments while leaving valid amendments in place. Id.
¶ 21. Because, here, we are addressing an injunction compelling
compliance with CC&Rs, rather than a judgment on the validity of the
CC&Rs as in Kalway, we will not blue pencil the 2022 amendments
themselves. Id.; see Reiswig, 130 Ariz. at 167, 168 (we may reverse superior
court’s injunction if based on erroneous view of law but scope of review
confined to effect of erroneous view on validity of injunction). We will
instead merely determine whether the court abused its discretion in

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ordering compliance with the amendments because they run afoul of
Kalway.
¶25
In Kalway, our supreme court struck amendments that limited
the type and number of livestock that could be kept on a property, limited
“the location, placement, or size of ‘non-dwelling structures,’” and required
homeowners to submit construction plans to their neighbors for approval.
Id. ¶¶ 30-36. Originally, all livestock were permitted, no limitation on non-
dwelling structures existed, and there was no plan approval process. Id. In
each case, the restriction was struck as entirely new, with our supreme court
holding that the CC&Rs did not provide notice to a reasonable homeowner
that the restriction could someday be imposed by bare majority vote. Id.
However, our supreme court did not strike an amendment that defined the
term “Garage,” because the term was used in the original declaration and
“defining the term was reasonably foreseeable.” Id. ¶ 24. We consider each
of the provisions of the 2022 amendments consistent with our supreme
court’s analysis.
2. Leasing or Renting Entire Lot—§ 4.22.1
¶26
In the 2022 amendments, § 4.22.1 provides:
No Owner may lease or rent less than the entire
Lot. For the purposes of this Section 4.22, the
use of “lease” or “rent” or any variation thereof,
is intended to include those occupancies subject
to the Arizona Landlord and Tenant Act, A.R.S.
§ 33-301 et. seq. and 33-1301 et. seq., or
possessory
real
estate
contracts.

The
Association may require Owners to disclose
information regarding the lease or rental
agreement within the limits of Arizona law.
The first sentence repeats the pre-existing restriction against partial leases
and remains enforceable. The second sentence is new, and defines any term
like “lease” or “rent” to be inclusive of the described types of occupancies.
Because these terms were used but undefined in the original CC&Rs, an
amendment defining these terms is reasonably foreseeable, is tethered to
existing provisions, and thus properly within the breadth of an injunction.
Id.
¶27
The disclosure required by the last sentence of § 4.22.1 could
be a foreseeable enforcement mechanism if it were tailored to the existing
restriction on partial rentals, or the existing requirement that a homeowner
provide the names of his tenants to the HOA. That is, it would be

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reasonably foreseeable that the HOA might compel a homeowner to
disclose information from his lease on the scope of the rental (to ensure it
was for the entire property) and reveal the names of the tenants (to which
it was already entitled). See id. ¶ 17 (amendment is valid if CC&Rs indicate
affirmative covenant exists and give notice that “the covenant can be
amended to refine it, correct an error, fill in a gap, or change it in a particular
way”). However, as written, it is overly broad and potentially requires a
homeowner to reveal other private contractual terms, beyond those related
to certain uses of the property validly controlled by the CC&Rs. Nothing
in the original CC&Rs puts a homeowner on notice that the majority of his
neighbors could impose an open-ended right to obtain information
regarding his private contractual relationships beyond the scope of the
lease and the names of the tenants. Id. ¶ 14 (“[A]n HOA cannot create new
affirmative obligations where the [CC&Rs] did not provide notice to the
homeowners that they might be subject to such obligations.”).
¶28
In Kalway, our supreme court addressed an amended
provision that required a property owner to submit any construction plans
to other property owners for their majority approval or rejection. Id. ¶ 36.
Although such a procedure might allow the property owners collectively to
ensure compliance with existing valid restrictions on lot development, the
court nonetheless held that “[n]othing in the original declaration put a
reasonable property owner on notice that an otherwise permissible use of
his . . . property would be subject to” a majority approval. Id. Similarly, the
court also struck down a provision that required “the submission of
improvement plans to the ‘Owners and Manager, in writing’ at least thirty
days before making such improvements” because “[n]o requirement for
submission of improvement plans was contained in or implied by the
original declaration.” Id. ¶ 38.
¶29
Here, although the last sentence of § 4.22.1 addresses
disclosure rather than an approval process, it nonetheless makes the
community potentially privy to a breadth of private information
concerning completely permissible uses. While this new provision would
undoubtedly make it easier for the HOA to enforce the CC&Rs, nothing in
the original CC&Rs puts a reasonable property owner on notice that
specifics of his private contractual affairs could be generally examined by
his neighbors. Therefore, pursuant to Kalway, because the amendment was
not unanimously adopted, the obligations imposed by the last sentence of
§ 4.22.1 of the 2022 amendments are not enforceable by court order. See 252
Ariz. 532, ¶ 21 (provisions not reasonably foreseeable stricken).
3. Prohibition on Short-Term Rentals—§ 4.22.2

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¶30
Under § 4.22.2 of the 2022 amendments to the CC&Rs, “[n]o
lot may be leased, rented, sublet, or assigned for a term of less than ninety
(90) consecutive days.” The amendment defines “short-term rental” to
mean a lease or rental agreement for less than ninety days, and emphasizes
that “[s]hort-term rentals are expressly prohibited.” It requires that “[a]ny
sublease or assignment of a lease shall be for the entire remainder of the
lease term.”
¶31
Tellingly, the record shows that the HOA itself determined
that the pre-2022 CC&Rs did not prevent short-term rentals within the
community. In its answer to Smith and Kintz’s amended counter-claim, the
HOA “admit[ted] that under the [CC&Rs] short-term rentals were allowed
and that it included no time limit on rentals.” The HOA also stipulated that
its Board “look[ed] closely” at the community’s CC&Rs and “were
surprised to discover” that short-term rental activity was “not currently
prohibited.”
¶32
By its own admission, then, when the HOA subsequently
amended the CC&Rs to bar short-term rentals of less than ninety days, this
was a new obligation that did not exist before. As originally adopted,
property owners were free to lease their homes for any period. We must
determine whether a short-term rental ban is nonetheless tethered to any
existing restriction.
¶33
The HOA asserts that § 4.22.2, unlike the provisions struck
down in Kalway, was not entirely new or unforeseeable because an
amalgam of provisions in the CC&Rs pertaining to “Single Family
Residential Use”—in §§ 1.23, 4.1.1, and 4.18—already worked to essentially
prohibit short-term rentals. The superior court agreed and determined that
the amendment merely clarified a pre-existing prohibition. This was error.
¶34
Section 1.23 of the existing CC&Rs defines “Lot” as “limited
to Single Family Residential Use”; §§ 4.1 and 4.1.1 reiterate that “Single
Family Residential Use” is a land use classification that “will apply only to
Lots”; and § 4.18 defines permissible residential uses, stating “[a]ll lots may
be used only for the construction and occupancy of single family detached
Residences and typical residential activities incidental thereto, such as the
construction and use of a family swimming pool.”3

3Under § 1.38 of the original CC&Rs, the term “Residence” is defined
as “any building, or part thereof, situated on a Lot designated and intended
for use as a residence by a single family.” The HOA does not address this
definition on appeal, and we do not address it. See Ritchie v. Krasner, 221
Ariz. 288, ¶¶ 61-62 (App. 2009) (argument not raised in opening brief with

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¶35
The use of the term “single family residence,” or “single
family residential use,” in the CC&Rs, however, does not restrict the use of
each property within the community to use by an identifiable, discrete single
family, such that no family of renters could ever occupy it. Although
undefined in the CC&Rs, “single family residence” is a term of art. See, e.g.,
A.R.S. § 33-1310(16) (defining “[s]ingle family residence” as “a structure
maintained and used as a single dwelling unit”). Generally, a
“single-family” residence or dwelling is contrasted with multi-family
housing or a “multiple dwelling development”—such as an apartment
building, condominium complex, or other structure with multiple
residential units. Compare, e.g., Pinal Cnty. Dev. Servs. Code ch. 2.55.010
(permitted uses in “CR-1A Single Residence Zone,” including “One-Family
dwelling, conventional construction”), with Pinal Cnty. Dev. Servs. Code
ch. 2.75.010 (permitted uses in “CR-4 Multiple Residence Zone,” including
a “[d]uplex dwelling”), and Pinal Cnty. Dev. Servs. Code ch. 2.80.010
(permitted uses in “CR-5 Multiple Residence Zone,” including “[m]ultiple
dwelling for any number of families”). Certainly, any mention of single-
family residential use in the CC&Rs must be read in harmony with § 4.18
(discussed below)—in which renting one’s property is excluded from the
definition of prohibited commercial uses—and § 4.22—in which renting
one’s lot is specifically permitted and no limit on rental duration exists.
Consequently, the provisions related to single family residential use in the
original CC&Rs do not support the superior court’s legal conclusion that
the 2022 amendments merely clarified a pre-existing prohibition.
¶36
Importantly, under § 4.18, “the leasing of a Residence by the
Owner thereof” was not restricted by the CC&Rs as a trade or business
activity, allowing an owner to believe that a property could be rented at
will, even if done as part of a business operation. Indeed, even those
limitations specifically imposed on non-rental trades and businesses within
the development do not foreshadow the new restrictions on leasing.
Business and trade activities generally are permitted under § 4.18 so long
as, among other things, they are not apparent by sight, sound, or smell from
outside of the residence, they conform to zoning and other general
regulations, they are not incompatible with the residential character of the
home or neighborhood, or they do not involve non-customary vehicle
congestion or foot traffic. Nothing about the short-term rental of a home
for residential use would necessarily run afoul of such generalized
restrictions, even if leasing were not expressly excepted from the trade or
business ban.

legal authority and record citation may be deemed waived); Ariz. R. Civ.
App. P. 13(a)(7).

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¶37
We are not persuaded by the HOA’s position at oral argument
that these restrictions are permissible because the manner by which people
rent homes today could not have been contemplated when the original
CC&Rs were established in 1997. Although the online rental services we
are familiar with today—such as Airbnb and Vrbo—may not have existed
or been as popular then, leasing and subleasing a property—for short or
long periods—is not a novel concept. But whether short-term rental
services were unforeseen or not, nothing in the original CC&Rs put a
reasonable homeowner on notice that short-term rental restrictions such as
those in § 4.22.2 could be imposed on his property someday without his
consent. Therefore, pursuant to Kalway, because the short-term rental
restriction in § 4.22.2 of the 2022 amendments was not unanimously
adopted, it is not enforceable. See 252 Ariz. 532, ¶ 21.
4. Prohibition on Rental Advertising—§ 4.22.3
¶38
Under § 4.22.3 of the 2022 amendments to the CC&Rs, a lot
may no longer be “advertised, listed, marketed, or otherwise offered in
writing or verbally in any form to any party as available on a short-term
rental basis, i.e. for a term of less than ninety (90) consecutive days.” The
original CC&Rs did not prohibit or limit advertising or marketing one’s
home for rent. This restriction is entirely new, and, as in our treatment of
§ 4.22.2, nothing put a homeowner on notice that it could be imposed.
Therefore, because it was also not unanimously adopted, the prohibitions
of § 4.22.3 of the 2022 amendments are not enforceable by injunction. Id.
(provisions not reasonably foreseeable stricken).
5. Terms Required in Lease Contracts—§ 4.22.4
¶39
Under § 4.22.4 as adopted, certain lease terms become
mandatory:
All leases must provide that the terms of the
lease are subject in all respects to the provisions
of the Declaration, Association Rules, and
Restrictions
(collectively
referred
to
a[s]
“Governing
Documents”)
and
that
any
violation of the Governing Documents by the
lessee, sublessees, assignees, or other occupants
shall be a default under the lease.
This restriction is untethered to any existing provision of the CC&Rs.
Homeowners, again, were not provided adequate notice in the original
CC&Rs that the majority could amend them to mandate terms in their
future leases, including terms of default. Id. ¶ 17 (“[A]mendments cannot

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be ‘entirely new and different in character,’ untethered to an original
covenant.” (quoting Lakeland, 459 N.E.2d at 1167)). We therefore strike any
obligation in § 4.22.4 from the scope of the injunction. Id. ¶ 21 (provisions
not reasonably foreseeable stricken).
6. Compliance With Governing Documents—§ 4.22.5
¶40
Under § 4.22.5, an original obligation is maintained in the first
sentence, but new affirmative obligations are imposed thereafter:
Any Owner who shall lease their Lot shall be
responsible for assuring compliance by the
occupant with the Governing Documents.
Failure by an Owner to take legal action,
including the institution of a forcible entry and
detainer proceeding against their occupant who
is in violation of the Governing Documents
within ten (10) days after receipt of written
demand to do so from the Association shall
entitle the Association, acting by and through
the Board, to take any and all such actions
including the institution of proceedings and
forcible entry and detainer on behalf of such
Owner against the occupant. Any expenses
incurred
by
the
Association,
including
reasonable attorneys’ fee[s] and costs of suit,
shall be repaid to it by such Owner. Failure by
such Owner to make such repayment within ten
(10) days after receipt of a written demand
therefore shall entitle the Association to levy a
fine against such Owner and the Lot for all such
expenses incurred by the Association. In the
event such fine is not paid within ninety (90)
days of its due date, the Association may resort
to all remedies for collection thereof.
¶41
Aside from the first sentence of § 4.22.5, which was carried
over from the original § 4.22, no homeowner under the original CC&Rs
would be on notice that the majority could impose these provisions in the
future. These proposed amendments permit the HOA to step into any
homeowner’s shoes and take legal action on his behalf. While this no doubt
may make enforcement of the CC&Rs easier, it creates an entirely new
power that is untethered to any existing provision of the CC&Rs: the power
to evict another homeowner’s tenants. The HOA does not even enjoy the
power to “evict” a property owner for failure to comply with the CC&Rs—

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it may only seek damages at law and injunctive relief for such violations
and foreclosure for past due assessments. Consequently, aside from the
first sentence, obligations imposed by § 4.22.5 of the 2022 amendments may
not be enforced by injunction. Id. (provisions not reasonably foreseeable
stricken).
C. Conclusion
¶42
To the extent we have concluded that the above amendments
were unforeseeable and unreasonable, the superior court abused its
discretion in granting a permanent injunction compelling Smith and Kintz
to abide by them. See McNally, 241 Ariz. 1, ¶ 11. Under our reasoning here,
the only obligations in the 2022 amendments that are valid under Kalway,
and thus enforceable by court order, are those provisions noted that already
existed in the original CC&Rs, and the provision in the second sentence of
§ 4.22.1 that defined “lease” or “rent,” as it was sufficiently tethered to pre-
existing provisions. But it does not necessarily follow that an order
enjoining compliance with these remaining valid provisions would be
proper such that we should leave it in place, even in part. See Ahwatukee
Custom Ests. Mgmt. Ass’n, Inc. v. Turner, 196 Ariz. 631, ¶ 9 (App. 2000).
¶43
An injunction compels compliance under penalty of
contempt, which extends beyond any contractual liability that might be
suffered by an enjoined party. See Bussart v. Superior Court, 11 Ariz. App.
348, 350 (1970) (because of severe consequences for violating injunction,
including contempt, court must meticulously follow Rule 65, Ariz. R. Civ.
P.); Restatement (Second) of Contracts § 357(2) (1981) (describing court’s
discretion to issue injunction in contract action). The imposition of an
injunction is an equitable remedy that requires the balancing of the rights
of the parties and hardships imposed with respect to the enjoined conduct.
See Turner, 196 Ariz. 631, ¶ 9 (“The enforcement of restrictive covenants
through an injunction is not a matter of right, but is governed by equitable
principles.”). Given our ruling, the balance before the superior court has
changed, and we therefore vacate the injunction in its entirety. We leave it
to the superior court in the first instance to determine whether a new
injunction enforcing the few foreseeable and reasonable provisions of the
2022 amendments identified above ought to be issued. See City of Flagstaff
v. Ariz. Dep’t of Admin., 255 Ariz. 7, ¶ 28 (App. 2023) (“We respect the role
of the trial court and trust in its competence to resolve all legal and factual
matters before it in the first instance.”).
II. Attorney Fees
¶44
On March 29, 2023, nearly a month after this appeal was
initiated, the superior court awarded the HOA its attorney fees and costs

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incurred from the beginning of this action to the court’s order granting its
motion for partial summary judgment. As we have explained, the superior
court has yet to certify a judgment as final under Rule 54. Although both
parties ask us to either affirm or vacate the court’s March 2023 fee and cost
award, we do not (yet) have jurisdiction to do so. See Fields v. Oates, 230
Ariz. 411, ¶ 25 (App. 2012). Nonetheless, because we vacate the court’s
permanent injunction, we also vacate the corresponding award of attorney
fees and costs to the HOA incurred to obtain it. See Tierra Ranchos
Homeowners Ass’n v. Kitchukov, 216 Ariz. 195, ¶ 37 (App. 2007); Eans-
Snoderly v. Snoderly, 249 Ariz. 552, ¶ 27 (App. 2020).
¶45
Both parties request their attorney fees on appeal pursuant to
Rule 21, Ariz. R. Civ. App. P., A.R.S. §§ 12-341, 12-341.01, and § 17.1 of the
CC&Rs, which entitles the prevailing party in any action instituted to
“enforce any of the provisions of [the] Declaration” to recover his
reasonable attorney fees and costs, as determined by the court, from the
non-prevailing party. The HOA also seeks attorney fees under A.R.S. § 12-
349. Because the HOA did not prevail on appeal, we do not award it
attorney fees or costs. Smith and Kintz, as the prevailing parties on appeal,
are entitled to their attorney fees and costs incurred in this appeal pursuant
to § 17.1 of the CC&Rs upon their compliance with Rule 21. See McDowell
Mountain Ranch Cmty. Ass’n, Inc. v. Simons, 216 Ariz. 266, ¶ 14 (App. 2007)
(“[T]he court lacks discretion to refuse to award fees under [a] contractual
provision.” (first alteration added, second alteration in McDowell) (quoting
Chase Bank of Ariz. v. Acosta, 179 Ariz. 563, 575 (App. 1994))).
Disposition
¶46
We vacate the permanent injunction against Smith and Kintz
without prejudice. We further grant Smith and Kintz their fees and costs
incurred on appeal upon compliance with Rule 21, and remand for further
proceedings consistent with this decision.
E C K E R S T R O M, Judge, concurring in part and dissenting in part:
¶47
In Kalway v. Calabria Ranch HOA, LLC, 252 Ariz. 532, ¶¶ 10-17
(2022), our supreme court did not prohibit all non-unanimous amendments
to an HOA’s CC&Rs. Rather, it held that, when the original CC&Rs placed
prospective owners on notice of a non-unanimous amendment process, that
process could only amend the original covenants when such amendments
would be “reasonable and foreseeable” in light of the original provisions.
Id. ¶ 10. In applying this principle, Kalway cautioned that the original
covenants do “not have to necessarily give notice of the particular details of
a future amendment; that would rarely happen.” Id. ¶ 17. Indeed, Kalway

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specifically authorized non-unanimous amendments if they merely refined
or “fill[ed] a gap” in the original restrictions. Id.
¶48
Thus, our supreme court implicitly authorized foreseeable,
non-unanimous amendments to make the original covenants effective in
application. Id. It did so presumably because HOA members not only
possess a contractual expectation that new restrictive covenants not be
imposed, see id., but also that the existing ones will be enforced and not
skirted.
¶49
Applying the above principles, I concur with the majority’s
articulation of the pertinent law and its application to the core dispute
here—the prohibition on short-term leases. But I cannot agree with its
rejection of three specific amendments: (1) that owners include within any
lease agreement a provision that places lessees on notice that the terms of
the lease are subject to the original CC&Rs;4 (2) that any violation of those
CC&Rs shall be a default under the lease; and (3) that the HOA may require
owners “to disclose information regarding the lease or rental agreement
within the limits of Arizona law.”
¶50
To the extent applied to the original covenants, each of these
provisions operates only to enforce those covenants, not to create any
additional restrictions on the use of the properties within the residential
community. Notably, the original agreement includes express restrictions
on partial leases. It entitles the HOA to receive the names of any lessees—
presumably to enforce that restriction. And, as my colleagues
acknowledge, the original agreement allows business and trade activities,
such as leasing, only so long as they remain compatible with the residential
character of the neighborhood. In furtherance of that provision, it prohibits
business activities that would create non-customary vehicle or pedestrian
congestion. In my view, the three amendments above, each relating to the
disclosure of the rental agreements and requirements as to their contents,
reasonably and foreseeably enforce those original, express restrictions on
any business use of the properties.
¶51
The majority objects to the disclosure provision on the ground
that it potentially makes the community “privy to a breadth of private
information concerning completely permissible uses.” But the original

4Although these provisions were intended, in part, to enforce a new
covenant against short-term rentals, a provision we have stricken, our
supreme court has instructed that we apply the “blue pencil” rule to such
amendments, preserving any that would remain enforceable as to the
original CC&Rs. Kalway, 252 Ariz. 532, ¶ 21.

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CC&Rs already gave the HOA permission to secure the names of any
lessees and placed substantial restrictions on the behaviors in which those
lessees could engage. Thus, the original CC&Rs provided notice that leases
could be monitored and restricted in substantial respects. Under those
provisions, owners had no reasonable, contractually based expectation of
privacy in the nature of their leasing operations beyond those provided by
law.
¶52
Under the common law of our state, even a majority of
homeowners in an HOA may not add new restrictions on the use of
properties that would infringe on the owners’ “expectations of the scope of
the [original] covenants.” Id. ¶ 17. But, by the same token, as represented
by the HOA, the homeowners collectively enjoy reasonable expectations
arising from the language of the original CC&Rs. That language entitles
them to expect that the original covenants will be enforced and that they
will have the power, by a vote of eighty percent of their membership, to
amend the original CC&Rs to achieve that. I concur with the majority in all
other respects.