Tag Archives: cc-and-rs

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.

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board-governanceprocedurecc-and-rs

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Cao et al. v. PFP Dorsey Investments, LLC, et al.

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Cao et al. v. PFP Dorsey Investments, LLC, et al.

257 Ariz. 82 (2024), CV-22-0228-PR · Arizona Supreme Court · March 22, 2024

At a Glance

Parties Minority condominium owners sued the condominium association and a majority owner that forced a termination sale.
Panel Justice Clint Bolick, Chief Justice Robert M. Brutinel, Vice Chief Justice Ann A. Scott Timmer, Justice John R. Lopez IV, Justice James P. Beene, Justice William G. Montgomery, Justice Kathryn H. King
Statutes interpreted

Summary

This case arose after a company bought almost all the units in a Tempe condominium project, then used the association’s voting structure to approve termination and force the remaining owners out. The Arizona Supreme Court held that, in these circumstances, the Arizona Condominium Act did not work an unconstitutional taking because the declaration had incorporated the statute and the owners bought subject to that framework. But the court still ruled for the owners on the core statutory issue. It held that A.R.S. § 33-1228(C) did not allow the association to sell only the minority owners’ units while leaving the majority owner’s units untouched. If a nonconsensual termination sale occurs under that section, the statute requires sale of all the common elements and all the units. The court also awarded the owners reasonable fees for the successful declaration-enforcement portion of the case.

Holding

When a declaration incorporates the Condominium Act, termination procedures under A.R.S. § 33-1228 can govern the owners’ rights, but a compelled post-termination sale under § 33-1228(C) must involve the entire condominium, not just the holdouts’ units.

Reasoning

The court first focused on contract and consent. The declaration repeatedly incorporated the Condominium Act, and the purchasers took title subject to that recorded framework. On that basis, the court concluded the case did not require striking the statute down as an unconstitutional taking in the way the owners argued.

The court then turned to statutory text. It read the phrase authorizing sale of all the common elements and units according to its ordinary meaning and emphasized that all means all. Reading the statute to permit sale of only dissenting units would strip critical words of meaning and would not fit the structure of the rest of § 33-1228, which treats termination with sale as a whole-condominium event administered by the association as trustee for all owners.

Why This Matters for HOAs

This is now the leading Arizona case on condominium terminations and forced buyouts. Associations, investors, and counsel can no longer assume that a supermajority can use termination to squeeze out a minority one unit at a time while keeping majority-owned units outside the sale.

The case also matters beyond terminations. It shows that Arizona courts will closely read condominium declarations that incorporate statutes by reference, but they will still enforce the text of the governing statute and declaration against associations that overreach.

Topics

cc-and-rsprocedureattorneys-fees

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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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