Tag Archives: board-governance

Colette McNally v. Sun Lakes Homeowners Association #1, Inc.

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Colette McNally v. Sun Lakes Homeowners Association #1, Inc.

1 CA-CV 15-0744 · Court of Appeals · October 13, 2016

At a Glance

Parties A duly elected board member sued the HOA after the board voted to exclude her from executive sessions.
Panel Presiding Judge Andrew W. Gould, Judge Peter B. Swann, Judge Patricia A. Orozco

Summary

After internal conflict on the board, Sun Lakes voted to bar one of its own elected directors from executive sessions. The excluded director sought injunctive relief, arguing the board had no authority to cut her out of board deliberations simply because other directors believed she had breached confidentiality or loyalty duties. The Court of Appeals agreed with her and reversed. The court treated board membership as carrying the right to participate in board meetings, including executive sessions, unless some legally valid removal or other recognized mechanism had been used. It would not let the rest of the board create an ad hoc punishment that effectively stripped an elected director of core board functions without following the governing legal framework.

Holding

The court held that the HOA board lacked authority to exclude a duly elected director from executive sessions and reversed the denial of injunctive relief.

Reasoning

The court focused on the nature of board office itself. A director is elected to participate in governing the corporation, and executive sessions are still board meetings, not separate private clubs for a board majority. Without a valid removal, suspension, or other recognized authority, the majority could not invent a partial-disqualification remedy.

The association argued that exclusion was justified by the director’s alleged misconduct and by the board’s need to protect confidential matters. The court was not persuaded that those concerns created authority where none existed. Governance has to follow the corporation’s legal structure and governing documents, not improvisation by fellow directors.

Why This Matters for HOAs

McNally is highly useful in HOA board-power disputes. It limits majority control tactics against dissident directors and reinforces that board process must track real authority, not political convenience.

For directors and members, the case supports the idea that elected office in an HOA carries enforceable participation rights unless the association follows the proper path to remove or discipline the director.

Topics

board-governancemeetings-and-records

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Iqtunheimr, LLC v. Val Vista Lakes Community Association

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Iqtunheimr, LLC v. Val Vista Lakes Community Association

No. 1 CA-CV 25-0095 (Ariz. App. Feb. 10, 2026) · Court of Appeals · February 10, 2026

At a Glance

Parties Iqtunheimr, LLC (homeowner/member/plaintiff-appellant) v. Val Vista Lakes Community Association and a board member (defendants-appellees).
Panel Hon. Jennifer M. Perkins, Hon. David D. Weinzweig, Hon. Cynthia J. Bailey
Statutes interpreted

Summary

A homeowner entity sued its HOA and a board member over alleged failure to maintain common areas and amenities such as parks, pools, lakes, greenbelts, and the clubhouse. The court of appeals held that the claims were derivative, not direct. The alleged harm was to common property and the community as a whole, so the claim legally belonged to the nonprofit association rather than to one owner acting alone. Because Arizona’s nonprofit derivative-suit statutes require either a large enough voting bloc or enough members plus a written demand on the corporation, the plaintiff lacked standing and the case was dismissed. The opinion is important because it squarely applies Title 10 derivative-suit rules to an HOA and explains how Arizona courts separate community-wide injuries from owner-specific injuries.

Holding

When a homeowner’s complaint is really about alleged damage to or mismanagement of common areas, the claim is derivative and must satisfy Arizona’s nonprofit derivative-suit statutes. A single owner who lacks the required support and who makes no written demand cannot bring that claim directly.

Reasoning

The court focused on the gravamen of the complaint, not the labels the plaintiff used. The alleged breaches all concerned shared amenities and common infrastructure. That kind of alleged injury affects the association’s property and all members collectively, so it is derivative in nature. The court relied on settled Arizona law that direct claims exist only when the plaintiff suffers a distinct personal injury or is owed a separate duty.

Once the court classified the suit as derivative, the statutory barriers mattered. Under sections 10-3631 and 10-3632, a member of a nonprofit corporation must have sufficient voting support or enough members behind the claim and must make a written demand before suing, absent narrow exceptions. The plaintiff had done neither, so dismissal was mandatory.

Why This Matters for HOAs

This is a high-value modern case for Arizona HOAs organized as nonprofit corporations. Boards defending common-area maintenance suits now have a clear appellate decision saying that one dissatisfied owner usually cannot litigate a community-wide maintenance dispute as a personal contract case.

For homeowners, the case is a roadmap too. If the complaint is really about the whole community, they need to organize other owners, satisfy demand requirements, and think strategically about derivative standing before filing. Otherwise they risk dismissal, fees, and possibly sanctions.

Topics

board-governanceprocedurecc-and-rs

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Kalway v. Calabria Ranch HOA, LLC

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Kalway v. Calabria Ranch HOA, LLC

252 Ariz. 532, 506 P.3d 18 (2022) · Arizona Supreme Court · March 22, 2022

At a Glance

Parties A subdivision owner challenged broad amended CC&Rs adopted by the HOA and other owners.
Panel Chief Justice Robert M. Brutinel

Summary

This is the modern Arizona Supreme Court case on how far an HOA can go when amending CC&Rs. Calabria Ranch used a general amendment clause to adopt major new restrictions affecting home size, outbuildings, fences, animals, improvements, and use of lots. Kalway argued that the original declaration did not give owners fair notice that such sweeping new limitations could later be imposed. The court agreed in large part. It said CC&Rs are not ordinary contracts because they run with land and bind future owners. That means amendment power has limits. Even if the declaration allows amendment by vote, later amendments must stay within the range of changes a buyer could reasonably expect from the original recorded declaration. An HOA cannot use a broad amendment clause as a blank check to create entirely new servitudes or materially different burdens that were not reasonably foreseeable at purchase.

Holding

A general amendment provision does not authorize an HOA to impose entirely new and different restrictions unless the original declaration gave owners sufficient notice that those kinds of changes could later be adopted.

Reasoning

The court treated recorded covenants as special property contracts. Because they bind land and not just the original signers, buyers must have notice from the original declaration of the kinds of burdens they may later face. The court rejected the idea that a generic amendment clause, standing alone, lets a majority rewrite the deal in any manner it wants.

The court drew the line at reasonable and foreseeable amendments. Changes that refine, clarify, or build on an existing covenant may be valid. But amendments that add new categories of restrictions untethered to the original declaration exceed the amendment power because they upset owners’ settled expectations and effectively create new servitudes without meaningful notice.

Why This Matters for HOAs

For Arizona HOA practice, this is the controlling case on CC&R amendments. Boards now have to ask not just whether they got the required vote, but whether the original declaration fairly warned owners that the specific type of restriction might later be adopted.

For homeowners and counsel, Kalway is the main defense against surprise amendments. It is also the main drafting lesson for developers and associations: if the community may later want rental limits, design controls, livestock limits, use restrictions, or similar burdens, the original declaration should say so with real specificity.

Topics

cc-and-rsboard-governance

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