Tag Archives: ADS

John R Krahn Living Trust/Janet Krahn Living Trust v Tonto Forest

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Case Summary

Case ID 25F-H020-REL
Agency —
Tribunal —
Decision Date 6/4/2025
Administrative Law Judge ADS
Outcome Granted
Filing Fees Refunded —
Civil Penalties —

Parties & Counsel

Petitioner John R Krahn Living Trust Counsel —
Respondent Tonto Forest Estates Homeowners Association Counsel —

Alleged Violations

No violations listed

Video Overview

Audio Overview

Decision Documents

25F-H020-REL Decision – 1252902.pdf

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25F-H020-REL Decision – 1258535.pdf

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25F-H020-REL Decision – 1261945.pdf

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25F-H020-REL Decision – 1262567.pdf

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25F-H020-REL Decision – 1267085.pdf

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25F-H020-REL Decision – 1274385.pdf

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25F-H020-REL Decision – 1277471.pdf

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25F-H020-REL Decision – 1280310.pdf

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25F-H020-REL Decision – 1284656.pdf

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25F-H020-REL Decision – 1301318.pdf

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25F-H020-REL Decision – 1312646.pdf

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25F-H020-REL Decision – 1314117.pdf

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25F-H020-REL Decision – 1337755.pdf

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Briefing Document: Petitioners vs. Tonto Forest Estates Homeowners Association

Executive Summary

This briefing document details the legal proceedings and administrative decisions regarding a series of consolidated cases brought before the Arizona Office of Administrative Hearings (OAH). The disputes involve several homeowners and living trusts (Petitioners), represented primarily by John Krahn and Michael Holland, against the Tonto Forest Estates Homeowners Association (Respondent or TFE), represented by Board President Dwight Jolivette.

The litigation, overseen by Administrative Law Judges (ALJs) Adam D. Stone and Velva Moses-Thompson, encompassed six distinct petitions (Case Nos. 24F-H033-REL, 25F-H002-REL, 25F-H006-REL, 25F-H009-REL, 25F-H011-REL, and 25F-H020-REL). These petitions alleged various violations of the Association’s Covenants, Conditions, and Restrictions (CC&Rs), Bylaws, and Arizona Revised Statutes (A.R.S.) governing planned communities.

Following hearings conducted between December 2024 and May 2025, the OAH issued a final decision on June 4, 2025 (later amended on June 5, 2025). The tribunal ruled in favor of the Petitioners in five out of the six matters, ordering TFE to comply with community documents and state statutes, and requiring the reimbursement of $3,500 in filing fees. While the tribunal found several violations, it consistently declined to award civil penalties, noting the Respondent’s efforts to remedy technical issues and ensure future compliance.

Detailed Analysis of Key Themes

1. Septic System Assessment and Maintenance Responsibilities

The tribunal addressed two separate issues regarding septic systems under CC&R 4.32.

  • Assessment of Undeveloped Lots (24F-H033-REL): Petitioners argued that TFE improperly assessed empty or undeveloped lots for septic-related expenses. The ALJ ruled that according to CC&R 4.32, the obligation to install and subsequently maintain a sewage treatment system is tied to the construction of a "Dwelling Unit." Therefore, only lots with dwelling units are subject to these assessments. Dividing costs among empty lots was found to be a violation of the governing documents.
  • Repair vs. Replacement (25F-H002-REL): A dispute arose regarding a $75.00 reimbursement to a former Board member for a "P-Series Float." Petitioners contended this was a replacement part, which is the homeowner's financial responsibility, while TFE argued it was a repair covered by the Association. The ALJ concluded the float was a replacement part, making the reimbursement an improper use of Association funds.
2. Notice of Violation and Enforcement Procedures (25F-H006-REL)

Petitioners challenged a notice regarding tree trimming, alleging it failed to meet statutory requirements under A.R.S. § 33-1803.

  • Statutory Compliance: The tribunal found that although the notice was framed as a "Friendly Reminder," it lacked necessary guidance. Specifically, it did not identify the specific CC&R section allegedly violated or provide clear instructions on the extent of required trimming.
  • Due Process: The tribunal noted that Mr. Krahn requested an appeal on the violation, but the Board failed to schedule it.
3. Ballot Secrecy and Post-Election Storage (25F-H020-REL)

This matter centered on the anonymity of the voting process under Bylaw 3.9.

  • Violation of Secret Ballot: Petitioners alleged that TFE attached signature verification pages to ballots after elections, potentially allowing anyone reviewing records to identify how members voted.
  • Ruling: The ALJ ruled that while the Bylaws do not explicitly detail storage procedures, the requirement for a "secret written ballot" implies that anonymity must be maintained even after the count is complete.
4. Board Transparency and Open Meeting Requirements (25F-H009-REL)

Petitioners alleged TFE violated A.R.S. § 33-1804(A) by deciding to invoke Directors and Officers (D&O) insurance coverage during a closed session rather than an open meeting.

  • The Litigation Exception: This was the only case where the Respondent prevailed. The ALJ determined that because there was pending litigation (a defamation suit filed by Mr. Krahn against the Board), the Board was within its rights to both discuss and decide on insurance invocation in a closed session.
  • Financial Impact: Petitioners argued the insurance claim led to policy cancellation and increased costs, but the Respondent testified that the cancellation was due to the insurer withdrawing from the market, not the claim itself.
5. Access to Association Records (25F-H011-REL)

Petitioners sought copies of all violation notices sent to other homeowners regarding "aesthetics" and tree trimming, requesting that personally identifying information be redacted.

  • Withholding of Records: TFE withheld the documents based on legal advice, claiming they were part of ongoing litigation.
  • Ruling: The ALJ found the records were wrongfully withheld. Because the notices were drafted and distributed by the Association’s manager prior to the litigation, they were not privileged and should have been produced within the statutory ten-business-day window.

Case Outcomes and Financial Summary

Case Number Primary Issue Ruling Filing Fee Reimbursement
24F-H033-REL Septic assessments on empty lots Granted (For Petitioner) $1,000.00
25F-H002-REL Improper septic part reimbursement Granted (For Petitioner) $500.00
25F-H006-REL Improper notice of violation Granted (For Petitioner) $500.00
25F-H009-REL Open meeting violation (Insurance) Denied (For Respondent) $0.00
25F-H011-REL Failure to provide records Granted (For Petitioner) $500.00
25F-H020-REL Violation of ballot secrecy Granted (For Petitioner) $500.00
Total $3,500.00

Important Quotes

Regarding Assessment Practices (24F-H033-REL)

"To divide the costs amongst the empty lots would result in those property owners paying 'more' of share of the assessment while owners with only one lot would pay less of share… the CC&R is clear that only lots with dwelling units are required to share in the Assessments issued." (ALJ Decision, Findings of Fact/Conclusions of Law)

Regarding Notice Standards (25F-H006-REL)

"The tribunal finds that although the notice was merely a 'Friendly Reminder' and not an actual fine notice… it still did not provide Mr. Krahn with guidance as to which section of the CC&R’s was violated." (ALJ Decision, Conclusions of Law)

Regarding Ballot Storage (25F-H020-REL)

"While it is true that the Bylaw does not reference storage following the election, it would necessarily follow that all ballots after counting, should be stored in a similar anonymous fashion." (ALJ Decision, Conclusions of Law)

Regarding Record Disclosure (25F-H011-REL)

"The tribunal finds that Respondent wrongfully withheld the notices requested, as they were not privileged in anyway. The tribunal disagrees with Mr. Jolivette’s interpretation of 'pending litigation' as defined in this statute." (ALJ Decision, Conclusions of Law)

Actionable Insights

  • Assessment Accuracy: Homeowners associations must strictly adhere to the specific language of their CC&Rs when levying assessments. If the governing documents link maintenance costs to "Dwelling Units," undeveloped lots cannot be included in that specific financial pool.
  • Enforcement Documentation: Compliance notices—even informal "friendly reminders"—must cite the specific community document provision being violated. Failure to do so renders the enforcement action legally deficient under A.R.S. § 33-1803.
  • Voter Anonymity Infrastructure: To comply with "secret ballot" requirements, associations should implement storage policies that decouple identifying information (like signature pages) from the ballots themselves immediately after verification and before archiving.
  • Transparency vs. Privilege: While Boards may discuss and act on insurance and legal strategies in closed sessions during active litigation, they cannot use "pending litigation" as a blanket excuse to withhold general association records (such as violation notices) that were generated in the normal course of business.
  • Financial Risk of Non-Compliance: The consolidation of multiple single-issue petitions can lead to significant financial liability for an association. In this matter, the failure to address individual grievances resulted in a $3,500 reimbursement obligation to the Petitioners.

Study Guide: Tonto Forest Estates Homeowners Association v. Petitioners (OAH Proceedings)

This study guide provides a comprehensive overview of the administrative legal proceedings between various property owners (Petitioners) and the Tonto Forest Estates Homeowners Association (Respondent). It covers the core legal disputes, the application of Arizona statutes, and the resulting judicial decisions.

1. Overview of the Proceedings

The matters were heard by the Arizona Office of Administrative Hearings (OAH) following petitions filed with the Arizona Department of Real Estate. The cases involve disputes over the interpretation of community governing documents and Arizona Revised Statutes (A.R.S.) Title 33.

  • Petitioners: John Krahn, Janet Krahn, Joseph Pizzicaroli, Michael Holland, John R. Krahn Living Trust, and Janet Krahn Living Trust.
  • Respondent: Tonto Forest Estates Homeowners Association (TFE).
  • Administrative Law Judges (ALJs): Adam D. Stone and Velva Moses-Thompson.
  • Core Issues: Assessment of undeveloped lots, septic system maintenance responsibilities, enforcement notice compliance, ballot anonymity, open meeting requirements, and records disclosure.

2. Key Legal Disputes and Findings

The following table summarizes the consolidated cases and the tribunal's rulings based on the Administrative Law Judge Decision issued June 4, 2025.

Case Number Statutory/Document Reference Primary Dispute Tribunal Ruling
24F-H033-REL CC&R 4.32; A.R.S. §33-1802 Assessing empty/undeveloped lots for septic-related expenses. Granted. Only lots with dwelling units are subject to these assessments.
25F-H002-REL CC&R 4.32 Improper reimbursement for a septic "P-Series Float" part. Granted. The part was a replacement (owner's cost), not a repair.
25F-H006-REL A.R.S. §33-1803(D)(1) Failure to provide specific CC&R references in a tree-trimming notice. Granted. Notices must provide specific guidance and statutory compliance.
25F-H020-REL Bylaw 3.9 Violation of secret ballot requirements by attaching signatures to ballots post-election. Granted. Anonymity must be maintained during storage after the election.
25F-H009-REL A.R.S. §33-1804(A) Deciding to file an insurance claim in a closed session rather than an open meeting. Denied. Boards may discuss and decide on litigation matters in closed sessions.
25F-H011-REL A.R.S. §33-1805(A) Failure to fulfill a redacted records request within ten business days. Granted. Documents were not privileged and were wrongfully withheld.

3. Detailed Concept Analysis

Septic System Responsibilities (CC&R 4.32)

Under the TFE CC&Rs, a distinction is made between the installation, maintenance, and replacement of sewage treatment systems:

  • Installation: Homeowners must install the system at their own expense when constructing a dwelling unit.
  • Maintenance and Repair: Once installed, the Association assumes responsibility for monitoring, maintenance, and repair, funded through assessments.
  • Capital Improvements/Replacements: These remain the sole responsibility of the individual lot owner.
  • Assessment Applicability: The tribunal ruled that "empty lots" cannot be assessed for these expenses because the obligation only triggers upon the existence of a dwelling unit.
Notice of Violation Requirements (A.R.S. § 33-1803)

When an association notifies a member of a condition violation (e.g., landscaping/trees):

  • The notice must identify the specific provision of the community documents allegedly violated.
  • The member has 21 calendar days to respond via certified mail.
  • The association must provide a written explanation within 10 business days of receiving the member's response.
Open Meeting Law and Litigation (A.R.S. § 33-1804)

While association meetings are generally open to all members, a board may enter a closed session for:

  1. Legal advice from an attorney.
  2. Pending or contemplated litigation.

The tribunal clarified that the Board is not required to make the final "action/decision" in an open meeting if that decision involves pending litigation against a homeowner, as the board's strategy and insurance invocations are protected.

4. Short-Answer Practice Questions

  1. Who bears the burden of proof in these administrative proceedings?
  • Answer: The Petitioner bears the burden of proving the violation by a preponderance of the evidence.
  1. How much is the standard filing fee for a single-issue petition filed with the Department?
  • Answer: $500.00 (Note: Case 24F-H033-REL involved a two-issue petition and a $1,000.00 fee).
  1. According to A.R.S. §33-1805(A), how long does an association have to fulfill a request for the examination of records?
  • Answer: Ten business days.
  1. Why was the "P-Series Float" reimbursement deemed a violation of the CC&Rs?
  • Answer: It was determined to be a "replacement part" rather than a "repair." Under CC&R 4.32, replacements are the financial responsibility of the owner, not the Association.
  1. What was the Respondent's defense regarding the storage of ballots in case 25F-H020-REL?
  • Answer: The Respondent argued that Bylaw 3.9 did not explicitly address the storage of ballots after the conclusion of the election.
  1. What is the maximum fee an association can charge per page for copies of records?
  • Answer: Fifteen cents ($0.15) per page.

5. Essay Prompts for Deeper Exploration

  1. The Intersection of Anonymity and Accountability: Analyze the conflict in Case 25F-H020-REL. Discuss why the tribunal determined that "secret ballots" must remain anonymous during storage, even if the bylaws are silent on post-election procedures. How does this protect the integrity of the democratic process within an HOA?
  2. Defining "Repair" vs. "Replacement": Using the evidence from Case 25F-H002-REL, argue the importance of clear definitions in CC&Rs. How can ambiguity in technical terms lead to financial disputes between boards and homeowners, and what steps should a board take when an invoice is unclear?
  3. Transparency vs. Litigation Privilege: Evaluate the ruling in Case 25F-H009-REL regarding A.R.S. § 33-1804(A). Debate whether a board should be allowed to make financial decisions (like invoking insurance) behind closed doors when those decisions impact the association's long-term premiums and financial health.

6. Glossary of Important Terms

  • Administrative Law Judge (ALJ): An official who presides over federal or state administrative proceedings, acting as the trier of fact and law.
  • Covenants, Conditions, and Restrictions (CC&Rs): The governing documents that dictate the rules for a real estate development and the obligations of its members.
  • Civil Penalty: A financial penalty imposed by a government agency or court as a restitution for wrongdoing, distinct from criminal fines. In these cases, Petitioners often sought $500.00 penalties.
  • Judicial Economy: A legal principle encouraging the efficient use of court resources, often leading to the "consolidation" of multiple related cases into a single hearing.
  • Nunc Pro Tunc: A Latin term meaning "now for then," referring to a court order that applies retroactively to correct an earlier ruling or record.
  • Order Holding Record Open: A procedural order allowing parties to submit additional evidence or written arguments (such as closing arguments) after the physical hearing has concluded.
  • Preponderance of the Evidence: The standard of proof in civil cases; evidence that has the most convincing force and demonstrates that a contention is "more probably true than not."
  • Respondent: The party against whom a petition is filed; in these documents, the Tonto Forest Estates Homeowners Association.
  • Secret Written Ballot: A voting method designed to ensure that the identity of the voter and their specific vote remain confidential.

HOA Accountability in Action: Lessons from the Tonto Forest Estates Legal Battle

In a significant marathon of administrative oversight, a group of homeowners—including John and Janet Krahn, Joseph Pizzicaroli, and Michael Holland—recently concluded a multi-petition legal challenge against the Tonto Forest Estates Homeowners Association (TFE). Over several months, the Arizona Office of Administrative Hearings (OAH) heard a series of six consolidated cases to address grievances ranging from improper financial assessments to the lack of transparency in governance.

Presided over by Administrative Law Judges (ALJ) Adam D. Stone and Velva Moses-Thompson, these hearings were consolidated for "judicial economy," providing a comprehensive look at how community documents and state statutes must be applied. The resulting decisions offer a clear roadmap for both homeowners and boards on the limits of association authority and the high cost of procedural shortcuts.

The Septic Dispute: Assessments and Improper Repairs

The most technically dense portion of the litigation, encompassing cases 24F-H033-REL and 25F-H002-REL, centered on the interpretation of CC&R 4.32 regarding the community’s sewage treatment system. The homeowners challenged the Association’s practice of assessing empty lots for septic expenses and the use of association funds for specific hardware replacements.

Issue/Dispute Final Legal Ruling
Assessment of Empty Lots (24F-H033-REL): TFE charged septic-related assessments to all lots, including those without dwelling units. Petitioner Victory (ALJ Stone): The tribunal ruled that only lots with dwelling units are subject to these assessments. Dividing costs among empty lots would force those owners to pay "more" of a share, while owners with dwelling units would pay "less" than their fair share.
Improper Repair Reimbursement (25F-H002-REL): TFE used association funds to reimburse a former Board member $75.00 for a "P-Series Float." Petitioner Victory (ALJ Stone): The tribunal determined the float was a replacement part, not a repair. Under the CC&Rs, replacements are the homeowner’s sole financial responsibility.

CC&R 4.32 Interpretation: Under the governing documents, the Association is responsible for the "monitoring, maintenance and repair" of the septic system once installed. However, any "capital improvements or replacements" are the sole responsibility of the homeowner. Because the "P-Series Float" constitutes a replacement of a component rather than a maintenance repair, the Board’s decision to reimburse the cost was a direct violation of the CC&Rs.

Beyond "Friendly Reminders": Notice Compliance

In a blow to informal governance, the tribunal clarified in case 25F-H006-REL that so-called "friendly reminders" carry the same statutory weight as formal violations. The dispute arose after Mr. Krahn received a notice regarding tree trimming for "aesthetics."

ALJ Stone found the notice legally deficient, noting it failed to specify how far back the homeowner needed to cut the tree to achieve compliance. The judge ruled that the Association cannot bypass statutory requirements by labeling a communication a "friendly reminder." Even informal notices must comply with ARS § 33-1803(C) and (D)(1). Based on the decision, a valid violation notice must include:

  • Specific Identification: Citing the exact provision within the community documents allegedly violated.
  • Clear Guidance: Precise instructions on what the homeowner must do to achieve compliance (e.g., specific trimming measurements).
  • Response Opportunity: Explicitly informing the member they have twenty-one calendar days to provide a written response via certified mail.

Transparency in Governance: Ballots and Records

Two cases highlighted the Board’s struggle with transparency and its failure to adhere to statutory timelines.

Secret Ballots (25F-H020-REL): The homeowners challenged the use of a "signature verification page" attached to ballots. While Board President Dwight Jolivette argued the Bylaws were silent on post-election storage, the judge ruled that the mandate for a "secret written ballot" necessitates voter anonymity even after the votes are counted. Mr. Jolivette’s testimony was found credible when he pledged that future storage policies would be updated to ensure total anonymity.

Record Requests (25F-H011-REL): The Association failed to provide redacted violation records within the 10-business-day window required by ARS § 33-1805(A). The Association attempted to shield the records under the guise of "pending litigation." However, the ALJ rejected this excuse, noting a critical legal distinction: the requested records (violation notices) were drafted and sent by the association manager prior to the litigation, meaning they were not privileged and should have been produced.

The Exception: Why the Board Won the Insurance Meeting Case

The sole defeat for the homeowners came in case 25F-H009-REL, which illustrated the boundaries of Arizona’s "open meeting" requirements. The dispute reached a fever pitch following a defamation lawsuit filed by Mr. Krahn against the Board after he was accused of embezzling $250.

The homeowners argued the Board violated ARS § 33-1804(A) by deciding to file a claim with their Directors and Officers (D&O) insurance in a closed session. Mr. Jolivette countered that Mr. Krahn effectively wanted to be in the "huddle" to observe the Board's legal strategy against his own lawsuit. The ALJ agreed with the Association, ruling that boards are permitted to discuss and decide on invoking insurance coverage in executive sessions when the matter involves legal advice and active litigation initiated by a member.

Final Verdict and Financial Impact

The final decision, issued on June 4, 2025, and corrected by a June 5, 2025, Order Nunc Pro Tunc, resulted in a significant financial rebuke for the Association. The Nunc Pro Tunc order was necessary because the initial ruling failed to account for the $1,000 filing fee required for the "two-issue" septic petition (24F-H033-REL).

The Association was ordered to reimburse the Petitioners for their filing fees as follows:

  • $1,000.00 for the initial two-issue petition (24F-H033-REL).
  • $2,000.00 for the four other granted petitions ($500 each).
  • Total Reimbursement: $3,000.00.

While the homeowners secured victories on five of the six counts, the tribunal declined to award civil penalties. The ALJ found Mr. Jolivette’s testimony regarding the Board's intent to comply with statutes moving forward to be credible, suggesting the tribunal viewed the errors as procedural failures rather than bad-faith actors.

Key Takeaways for Homeowners and Boards

The Tonto Forest Estates dispute serves as a vital case study for Arizona HOAs. Legal journalists and practitioners can distill three primary lessons from the record:

  1. Strict Adherence to CC&Rs: Boards must distinguish between "repairs" and "replacements." Using association funds for homeowner-level responsibilities or misapplying the "share of assessment" logic to empty lots constitutes a breach of the governing documents.
  2. Procedural Precision in Notices: Every communication regarding a property violation—even those intended to be "friendly"—must cite the specific section of the CC&Rs and provide actionable guidance for compliance.
  3. The Importance of Transparency: Boards cannot use "pending litigation" as a blanket excuse to withhold records that predated the dispute. Furthermore, the right to a secret ballot extends to the post-election handling and storage of those documents.

The resolution of these cases through the Office of Administrative Hearings underscores the critical role of the Arizona Department of Real Estate in providing a streamlined venue for homeowners to enforce their rights and hold boards accountable to the law.

Case Participants

Petitioner Side

  • John Krahn (Petitioner)
    John R Krahn Living Trust
  • Janet Krahn (Petitioner)
    Janet Krahn Living Trust
  • Joseph Pizzicaroli (Petitioner)
  • Michael Holland (Petitioner)
    Holland Family Trust

Respondent Side

  • Dwight Jolivette (Representative)
    Tonto Forest Estates Homeowners Association
    Board President
  • Barbara Bonilla (Contact)
    Tonto Forest Estates Homeowners Association
    Listed on transmittal records

Neutral Parties

  • Adam D. Stone (Administrative Law Judge)
    Office of Administrative Hearings
  • Velva Moses-Thompson (Administrative Law Judge)
    Office of Administrative Hearings
    Issued early procedural orders in this specific docket.
  • Susan Nicolson (Commissioner)
    Arizona Department of Real Estate

Arroyo Mountain Estate Homeowners Association v. Goebel, Rick Jr. & Elizabeth

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Case Summary

Case ID 24F-H050-REL
Agency —
Tribunal —
Decision Date 2024-09-11
Administrative Law Judge ADS
Outcome —
Filing Fees Refunded —
Civil Penalties —

Parties & Counsel

Petitioner Arroyo Mountain Estate Homeowners Association Counsel Daniel S. Francom, Esq.
Respondent Rick Goebel Jr. & Elizabeth Goebel Counsel Pro se

Alleged Violations

No violations listed

Video Overview

Audio Overview

Decision Documents

24F-H050-REL Decision – 1222437.pdf

Uploaded 2026-04-24T12:25:07 (132.2 KB)

Arroyo Mountain Estate HOA vs. Goebel: A Dispute Over Architectural Approval

Executive Summary

This document provides a comprehensive overview of the dispute between the Arroyo Mountain Estate Homeowners Association (HOA) and homeowners Rick and Elizabeth Goebel, culminating in an administrative law hearing on August 28, 2024. The central conflict revolves around the construction of a courtyard wall at the Goebels’ property, which the HOA alleged was unapproved and in violation of community guidelines.

The Goebels maintained that they followed all required procedures, submitting multiple revised applications at the HOA’s request, and ultimately received explicit, unconditional approval from the Architectural Review Committee (ARC) before commencing work. They argued that they built a “courtyard wall” in conformance with section 2.9 of the guidelines, which does not specify a height limit, and not a “pony wall,” which is restricted to 42 inches under section 2.24.

The HOA contended that the Goebels’ application was misleading due to a lack of critical details, specifically the wall’s 8-foot 8-inch height and a three-foot overhead hood. Key members of the ARC testified they understood the application to be for landscaping only and would have denied it had the full scope been clear. The HOA argued the constructed wall violates the spirit and letter of the guidelines intended to maintain community aesthetic uniformity.

The case concluded with a definitive ruling by an Administrative Law Judge on September 11, 2024. The judge denied the HOA’s petition, finding that they had not met their burden of proof. The decision highlighted that the Goebels had followed the prescribed process, justifiably relied on the ARC’s formal approval, and that the HOA’s month-long delay in issuing a stop-construction notice was unreasonable. The ruling deemed the ARC’s approval “tantamount to an exception to the Guidelines.”

The Core Dispute: The Courtyard Wall

The conflict centers on improvements made at the Goebels’ property, located at 5408 North Prescott Court (incorrectly listed multiple times in HOA documents as 5408 North Carson Court). The primary structure in question is a wall enclosing a front courtyard area, which the Goebels’ plans identified as a “courtyard wall.”

Alleged Violations by the HOA

The HOA’s petition alleged that the Goebels were in violation of two primary governing documents:

1. CC&Rs Article V, Section 5.22: This section requires homeowners to receive ARC approval before beginning any construction that alters the exterior appearance of a property, demanding that requests “Specify in detail the nature and extent of construction.”

2. Architectural and Landscape Design Guidelines, Section 2.24: This section governs “Pony Walls and Courtyards,” stating that pony walls constructed in a front yard to form a courtyard “should be no higher than 42 inches.”

The HOA argued that the wall built by the Goebels, which reaches a height of approximately 8 feet 8 inches, is functionally a pony wall and therefore violates the 42-inch height restriction.

The Homeowner’s (Goebel) Position and Timeline

The Goebels’ defense was anchored in their assertion of procedural compliance, reliance on a formal approval, and a belief that they were being unfairly targeted.

Application and Approval Process

The timeline of the application process was a key element of the Goebels’ case:

Dec 30, 2022

Initial consolidated application for all improvements submitted via email.

Jan 3, 2023

Initial application denied with the instruction to “please resubmit separate applications for the different projects.”

Jan 3, 2023

Revised, separate applications submitted to the community manager, Katie Sand.

Jan 3, 2023

Additional comments received from Katie Sand requesting further changes.

Jan 3, 2023

Final revised applications submitted at 4:14 p.m. and notice of acceptance received at 4:26 p.m.

Jan 5, 2023

The ARC formally approved the applications, within 48 hours of submission, without requesting additional information.

Argument of Good Faith and Procedural Adherence

Mr. Goebel argued that he diligently followed the HOA’s process and could not have done more to ensure compliance.

“I follow the requirement of the architectural community prepared the application submitted the application via the appropriate application approval process and received approval. It’s unclear what I’m being violated for. It is unclear as to how I violated any part of the approval or constructed improvements not identified on the plan.” – Rick Goebel

He emphasized that the ARC, under its own guidelines, had the power to request more information if the application was deemed incomplete but chose not to, instead granting full approval. Elizabeth Goebel further stated, “they approved the application and we move forward with our approval… We still got the approval. We moved forward in good faith and constructed what we had done.”

Construction Timeline and HOA Response

• March 21, 2023: Engineering drawings submitted to Maricopa County.

• March 24, 2023: Technical approvals and permits issued by the county.

• April 7, 2023: Construction commenced.

• April 19, 2023: The wall reached its full height.

• May 12, 2023: Nearly one month after the wall was completed, the Goebels received a stop-construction notice from the HOA.

Claims of Targeted Harassment

Mr. Goebel testified that he felt his family and home were being targeted by board members, leading to significant distress and financial cost.

“Over the past 12 months, I’ve had to deal with continued harassment from our board… People drive past my home, take pictures of my home. John Conalo has driven past my home multiple times taking pictures of my home… I have people to drive by my home, take photos and post these photos online and generally disrupt the reasonable enjoyment of my property. I am of the opinion that me and my home are being targeted for these improvements by members of the board who are utilizing funds to support the basic attack.” – Rick Goebel

The Homeowners Association’s (HOA) Position

The HOA’s case, presented by attorney Daniel Francom, focused on the argument that the Goebels’ application was deficient and that any approval granted was therefore invalid for the wall as constructed.

Insufficient Detail and Misleading Application

The HOA argued the Goebels “failed to provide sufficient details” in their application.

• Wall Height: The plans did not specify the wall would be 8 feet 8 inches high.

• Overhead Hood: The plans did not clearly indicate a three-foot deep overhead structure above the gate.

• County Plans: The detailed plans submitted to Maricopa County, which included engineering reports and the exact wall height, were never provided to the HOA.

Board President John Consalvo testified that the application “showed nothing about a construction wall showing landscape application turned in.”

Architectural Committee’s Interpretation

ARC member Judy Oliver provided crucial testimony for the HOA, stating that the committee was misled by the application’s presentation.

• She testified that since the application was titled “revamping of landscaping,” she and other members “assumed that this was regarding landscaping only.”

• Regarding the wall itself, she stated, “I felt that that wall wasn’t even up for discussion at the time.”

• Crucially, she asserted that had the Goebels provided specifics for an 8-foot wall, the committee would have denied the project as it “counters the architectural guidelines.”

Violation of Guideline 2.24 (“Pony Walls”)

The HOA’s legal argument rested on classifying the Goebels’ structure under section 2.24. They argued that because the wall creates a courtyard, it should be considered a “pony wall” and is therefore subject to the 42-inch height limit, regardless of what the Goebels labeled it in their plans. They argued the wall “sticks out like a sore thumb” and that there are no other similar walls in the community.

Key Witness Testimony

Ms. Rozzo’s testimony significantly undermined the HOA’s position.

• Admission of Error: When asked if she noted the courtyard wall, she stated, “No, I absolutely missed it. I am completely honest about that. I have missed it just like we’ve missed other ones and nothing’s done about it.”

• Precedent of Inaction: She testified that the ARC had mistakenly approved “at least 15 to 20 homes” with non-compliant improvements and that “the HOA has never pursued them.” She cited unapproved walls, pavers, and concrete pads at other properties.

• Challenge to HOA’s Pursuit: She expressed surprise that the HOA was pursuing this case, stating that when she told John Consalvo that pursuing the Goebels meant they should pursue all other erroneous approvals, he “chuckled and said, ‘Mike, my neighbor,'” implying a neighbor of the board president also had unapproved improvements.

• Board Vote: Ms. Rozzo, who was also a board member for a short time, revealed that the decision to take action against the Goebels was not unanimous, with two of the five board members voting “no.”

Mr. Consalvo testified that the board’s function is to maintain the community and enforce HOA rules. He stated that the Goebels’ application did not provide the required detail for the courtyard wall, its height, or the overhead gate structure. He confirmed he took photos of the property and that, in his view, the wall as built did not conform to any approved application and should have been limited to 42 inches.

Ms. Oliver testified she had been on the ARC since 2017. She stated that the application was understood to be for landscaping and that the wall was not considered for approval due to the lack of detail. She testified that had the 8-foot height been specified, the application would have been denied.

The Final Decision: Administrative Law Judge Ruling

On September 11, 2024, Administrative Law Judge Adam D. Stone issued a final, binding decision in the case (No. 24F-H050-REL).

Ruling

The Petitioner’s (HOA’s) petition was denied. The judge found that the HOA failed to prove its case by a preponderance of the evidence.

Reasoning for the Decision

The judge provided a clear, multi-point rationale for siding with the Goebels:

1. Procedural Compliance: “Respondent followed the process as laid out in section 5.22 of the CC&Rs, by submitting its Application to the ARC.”

2. Justifiable Reliance on Approval: The ARC had multiple opportunities to question the plans and did so on other matters. The judge concluded that Ms. Rozzo’s approval, even if she “missed it,” was a formal action on which the “Respondent justifiably relied… and moved ahead with construction.”

3. Approval as an Exception: The judge stated the formal approval “was tantamount to an exception to the Guidelines as the project was approved.”

4. Unreasonable Delay by HOA: The judge found that for the HOA “to wait almost a month once the project was completed to provide a stop construction notice to Respondent was unreasonable.”

5. Inconsistent Enforcement: The judge noted that “this was not the first time the ARC had approved projects that were not within the Guidelines,” referencing the testimony about other unpursued violations in the community.

Final Order

• The HOA’s petition was formally denied.

• The Respondent (Goebels) was not required to reimburse the HOA’s $500 filing fee.

Questions

Question

If the HOA approves my architectural application, can they later claim a violation because they 'missed' details in the plan?

Short Answer

No. If the HOA approves the application, the homeowner can justifiably rely on that approval to proceed, even if the committee claims they missed specific details during review.

Detailed Answer

The ALJ ruled that once an application is approved, the homeowner has the right to rely on that approval to begin construction. Even if an Architectural Committee member testifies later that they 'missed' a detail (like a wall height) during their review, the approval stands. The HOA cannot penalize the homeowner for the committee's oversight after approval has been granted.

Alj Quote

Ms. Rozzo testified that while she may have “missed it”, the Application was nonetheless approved, and Respondent justifiably relied on the approval and moved ahead with construction.

Legal Basis

Justifiable Reliance

Topic Tags

  • architectural approval
  • committee oversight
  • homeowner reliance

Question

Can an approved application serve as a valid exception to written architectural guidelines?

Short Answer

Yes. An approved application can be considered tantamount to an exception to the community's design guidelines.

Detailed Answer

In this case, the HOA argued the construction violated height guidelines. However, because the specific project plans were submitted and approved by the committee, the ALJ determined that this approval effectively acted as an exception to the general guidelines, making the construction permissible.

Alj Quote

This was tantamount to an exception to the Guidelines as the project was approved.

Legal Basis

Exception to Guidelines

Topic Tags

  • guidelines
  • exceptions
  • compliance

Question

Is it reasonable for an HOA to issue a stop work notice after I have already completed my project?

Short Answer

No. Waiting until a project is completed to issue a stop construction notice is considered unreasonable.

Detailed Answer

The ALJ found that the HOA failed to act in a timely manner. Issuing a stop construction notice nearly a month after the homeowner had already finished building the structure was deemed unreasonable behavior by the association.

Alj Quote

Moreover, for Petitioner to wait almost a month once the project was completed to provide a stop construction notice to Respondent was unreasonable.

Legal Basis

Reasonableness / Laches

Topic Tags

  • enforcement timing
  • stop work order
  • construction

Question

Who has to prove that a violation occurred during an HOA hearing?

Short Answer

The HOA (the Petitioner) bears the burden of proof.

Detailed Answer

When an HOA petitions for a hearing regarding a violation, they must prove their case by a 'preponderance of the evidence.' This means they must convince the judge that their claim is more likely true than not. If they fail to meet this burden, the homeowner prevails.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated ARIZ. REV. STAT. § 33-1803.

Legal Basis

Burden of Proof

Topic Tags

  • legal procedure
  • evidence
  • burden of proof

Question

Does it matter if the HOA has allowed other non-compliant projects in the neighborhood?

Short Answer

Yes. Evidence that the HOA has previously approved other projects that did not meet guidelines can support the homeowner's defense.

Detailed Answer

The ALJ noted that the evidence showed this was not an isolated incident; the Architectural Committee had previously approved other projects that were not compliant with the Guidelines. This pattern weakens the HOA's position in enforcing the rule against the current homeowner.

Alj Quote

Further, as the evidence provided, this was not the first time the ARC had approved projects that were not within the Guidelines.

Legal Basis

Arbitrary Enforcement / Precedent

Topic Tags

  • selective enforcement
  • consistency
  • precedent

Question

If I submit an application and answer the committee's questions, do I have to ensure they asked about every single detail?

Short Answer

No. If you follow the submission process and the committee has the opportunity to ask questions but doesn't, the responsibility lies with them.

Detailed Answer

The homeowner followed the CC&R process by submitting the application. The committee had multiple chances to ask for clarification or details (like height) but failed to do so before approving. The judge ruled the homeowner followed the proper process.

Alj Quote

Respondent followed the process as laid out in section 5.22 of the CC&Rs, by submitting its Application to the ARC. The ARC had many opportunities thereafter to question Respondent about the project

Legal Basis

Due Process / Procedural Compliance

Topic Tags

  • application process
  • due diligence
  • homeowner obligations

Question

Do I have to pay the HOA's filing fees if they sue me and lose?

Short Answer

No. If the HOA's petition is denied, the homeowner is not required to reimburse the filing fee.

Detailed Answer

The ALJ explicitly ordered that because the petition was denied, the respondent (homeowner) was not required to pay back the $500 filing fee that the HOA paid to the Department.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee

Legal Basis

ARIZ. REV. STAT. § 32-2199.02(A)

Topic Tags

  • fees
  • penalties
  • costs

Case

Docket No
24F-H050-REL
Case Title
Arroyo Mountain Estate Homeowners Association v. Goebel
Decision Date
2024-09-11
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Questions

Question

If the HOA approves my architectural application, can they later claim a violation because they 'missed' details in the plan?

Short Answer

No. If the HOA approves the application, the homeowner can justifiably rely on that approval to proceed, even if the committee claims they missed specific details during review.

Detailed Answer

The ALJ ruled that once an application is approved, the homeowner has the right to rely on that approval to begin construction. Even if an Architectural Committee member testifies later that they 'missed' a detail (like a wall height) during their review, the approval stands. The HOA cannot penalize the homeowner for the committee's oversight after approval has been granted.

Alj Quote

Ms. Rozzo testified that while she may have “missed it”, the Application was nonetheless approved, and Respondent justifiably relied on the approval and moved ahead with construction.

Legal Basis

Justifiable Reliance

Topic Tags

  • architectural approval
  • committee oversight
  • homeowner reliance

Question

Can an approved application serve as a valid exception to written architectural guidelines?

Short Answer

Yes. An approved application can be considered tantamount to an exception to the community's design guidelines.

Detailed Answer

In this case, the HOA argued the construction violated height guidelines. However, because the specific project plans were submitted and approved by the committee, the ALJ determined that this approval effectively acted as an exception to the general guidelines, making the construction permissible.

Alj Quote

This was tantamount to an exception to the Guidelines as the project was approved.

Legal Basis

Exception to Guidelines

Topic Tags

  • guidelines
  • exceptions
  • compliance

Question

Is it reasonable for an HOA to issue a stop work notice after I have already completed my project?

Short Answer

No. Waiting until a project is completed to issue a stop construction notice is considered unreasonable.

Detailed Answer

The ALJ found that the HOA failed to act in a timely manner. Issuing a stop construction notice nearly a month after the homeowner had already finished building the structure was deemed unreasonable behavior by the association.

Alj Quote

Moreover, for Petitioner to wait almost a month once the project was completed to provide a stop construction notice to Respondent was unreasonable.

Legal Basis

Reasonableness / Laches

Topic Tags

  • enforcement timing
  • stop work order
  • construction

Question

Who has to prove that a violation occurred during an HOA hearing?

Short Answer

The HOA (the Petitioner) bears the burden of proof.

Detailed Answer

When an HOA petitions for a hearing regarding a violation, they must prove their case by a 'preponderance of the evidence.' This means they must convince the judge that their claim is more likely true than not. If they fail to meet this burden, the homeowner prevails.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated ARIZ. REV. STAT. § 33-1803.

Legal Basis

Burden of Proof

Topic Tags

  • legal procedure
  • evidence
  • burden of proof

Question

Does it matter if the HOA has allowed other non-compliant projects in the neighborhood?

Short Answer

Yes. Evidence that the HOA has previously approved other projects that did not meet guidelines can support the homeowner's defense.

Detailed Answer

The ALJ noted that the evidence showed this was not an isolated incident; the Architectural Committee had previously approved other projects that were not compliant with the Guidelines. This pattern weakens the HOA's position in enforcing the rule against the current homeowner.

Alj Quote

Further, as the evidence provided, this was not the first time the ARC had approved projects that were not within the Guidelines.

Legal Basis

Arbitrary Enforcement / Precedent

Topic Tags

  • selective enforcement
  • consistency
  • precedent

Question

If I submit an application and answer the committee's questions, do I have to ensure they asked about every single detail?

Short Answer

No. If you follow the submission process and the committee has the opportunity to ask questions but doesn't, the responsibility lies with them.

Detailed Answer

The homeowner followed the CC&R process by submitting the application. The committee had multiple chances to ask for clarification or details (like height) but failed to do so before approving. The judge ruled the homeowner followed the proper process.

Alj Quote

Respondent followed the process as laid out in section 5.22 of the CC&Rs, by submitting its Application to the ARC. The ARC had many opportunities thereafter to question Respondent about the project

Legal Basis

Due Process / Procedural Compliance

Topic Tags

  • application process
  • due diligence
  • homeowner obligations

Question

Do I have to pay the HOA's filing fees if they sue me and lose?

Short Answer

No. If the HOA's petition is denied, the homeowner is not required to reimburse the filing fee.

Detailed Answer

The ALJ explicitly ordered that because the petition was denied, the respondent (homeowner) was not required to pay back the $500 filing fee that the HOA paid to the Department.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee

Legal Basis

ARIZ. REV. STAT. § 32-2199.02(A)

Topic Tags

  • fees
  • penalties
  • costs

Case

Docket No
24F-H050-REL
Case Title
Arroyo Mountain Estate Homeowners Association v. Goebel
Decision Date
2024-09-11
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Daniel S. Francom (Attorney)
    Arroyo Mountain Estate Homeowners Association
  • John Consalvo (Witness)
    Arroyo Mountain Estate Homeowners Association
    Board President
  • Judy Oliver (Witness)
    Arroyo Mountain Estate Homeowners Association
    Architectural Committee Member

Respondent Side

  • Rick Goebel Jr. (Respondent)
  • Elizabeth Goebel (Respondent)
  • Nancy Rozzo (Witness)
    Architectural Committee Member who approved the application

Neutral Parties

  • Adam D. Stone (Administrative Law Judge)
    Office of Administrative Hearings
  • Susan Nicolson (Commissioner)
    Arizona Department of Real Estate

Jerome L. Glazer vs Heritage Village III Homeowners Association

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Case Summary

Case ID 24F-H039-REL
Agency —
Tribunal Arizona Office of Administrative Hearings
Decision Date 2024-08-23
Administrative Law Judge ADS
Outcome complete
Filing Fees Refunded —
Civil Penalties —

Parties & Counsel

Petitioner Taylor Kidd Counsel Patrick T. Nackley, Brandon P. Bodea
Respondent Heritage Village III Homeowners Association Counsel Tessa Knueppel, Mark K. Sahl, Charles H. Oldham, Josh Bolen

Alleged Violations

No violations listed

Video Overview

Audio Overview

Decision Documents

24F-H039-REL Decision – 1182719.pdf

Uploaded 2026-04-24T12:23:10 (62.8 KB)

24F-H039-REL Decision – 1182767.pdf

Uploaded 2026-04-24T12:23:18 (13.4 KB)

24F-H039-REL Decision – 1182769.pdf

Uploaded 2026-04-24T12:23:21 (50.0 KB)

24F-H039-REL Decision – 1203525.pdf

Uploaded 2026-04-24T12:23:25 (49.3 KB)

24F-H039-REL Decision – 1215299.pdf

Uploaded 2026-04-24T12:23:28 (123.4 KB)

24F-H039-REL Decision – 1226570.pdf

Uploaded 2026-04-24T12:23:31 (39.7 KB)

Briefing Document: Kidd and Glazer v. Heritage Village III Homeowners Association

Executive Summary

This briefing document details the legal proceedings and final decision in the consolidated matters of Taylor Kidd and Jerome L. Glazer vs. Heritage Village III Homeowners Association (Case Nos. 24F-H037-REL and 24F-H039-REL). The dispute centered on the Respondent’s approval of a $1.55 million "Landscape Improvement Project" and a subsequent $9,385.24 special assessment per homeowner, conducted without a membership vote.

The Office of Administrative Hearings (OAH) ultimately ruled in favor of the Petitioners, Taylor Kidd and Jerome L. Glazer. The Administrative Law Judge (ALJ) determined that the Association’s governing documents explicitly incorporated the "McCormick Ranch CC&Rs," which require a two-thirds majority vote for capital improvement assessments. Because no such vote was held, the Association was found in violation of its Covenants, Conditions, and Restrictions (CC&Rs). The Association was ordered to reimburse the Petitioners' filing fees.

Procedural History and Case Background

The following table outlines the timeline and administrative milestones of the case:

Date Event Details
February 27, 2024 Petition Filed (Kidd) Taylor Kidd filed a single-issue petition regarding the landscape project and paid a $500 fee.
February 29, 2024 Petition Filed (Glazer) Jerome L. Glazer filed a similar single-issue petition and paid a $500 fee.
May 28, 2024 Consolidation Order ALJ Tammy L. Eigenheer ordered the cases consolidated for administrative efficiency.
May 28, 2024 Cease & Desist Denied The ALJ denied Glazer's request to halt project expenditures, citing a lack of authority to issue such orders.
May 30, 2024 Original Hearing Date Postponed due to a medical emergency involving Petitioner Glazer’s domestic partner.
July 19, 2024 Rescheduled Hearing Continued again due to a widespread computer outage.
August 9, 2024 Evidentiary Hearing Held before ALJ Adam D. Stone.
August 23, 2024 Final Decision ALJ Stone ruled in favor of Petitioners, granting their petitions.
September 23, 2024 Minute Entry ALJ Stone declined to consider a Motion for Rehearing, stating such requests must go to the Arizona Department of Real Estate.

Detailed Analysis of Key Themes

1. Incorporation of External Governing Documents

The central legal conflict involved which CC&Rs governed the Association's actions. While the Association’s own CC&Rs were silent on the requirement for a membership vote for capital improvements, Article VII, Section 1 of their documents stated that the McCormick Ranch CC&Rs "are made part hereof and are hereby referenced as to the provisions required for this entire property."

The McCormick Ranch CC&Rs (Article III, Section 4) explicitly require the "assent of two-thirds (2/3) of the votes cast by Voting Owners" for special assessments related to capital improvements. The ALJ concluded that the Association could not cherry-pick which parts of the McCormick Ranch CC&Rs applied; the incorporation was total.

2. Board Authority vs. Member Consent

The Association, through Board member Jennifer Hutsko, argued that the Board had a fiduciary duty to maintain the property, which was suffering from a 40-year-old failing irrigation system and diseased trees. They contended that since the Association’s specific CC&Rs were silent on voting for maintenance, the Board could act unilaterally.

The Petitioners successfully argued that the "Landscape Improvement Project" constituted a capital improvement rather than routine maintenance. Consequently, the procedural requirement for a membership vote took precedence over the Board's unilateral decision-making authority.

3. Administrative Economy and Efficiency

The Respondent successfully moved to consolidate the Kidd and Glazer cases under ARIZ. ADMIN. CODE R2-19-109(A). The consolidation was granted to avoid "potentially inconsistent rulings" and to promote administrative efficiency, as both matters involved objections from different homeowners to the same Board action. Despite objections from Taylor Kidd regarding potential delays, the ALJ found that the substantially similar factual and legal issues justified a single hearing.

4. Jurisdictional Limits of the OAH

A significant procedural theme was the ALJ's limited authority. When Petitioner Glazer requested a Cease and Desist Order to stop the Association from spending funds on the project, the ALJ denied the request, stating, "The Administrative Law Judge is without the authority to issue such an order in this matter." This highlights that while the OAH can adjudicate violations of community documents, its power to grant injunctive-style relief is restricted.

Important Quotes with Context

"Respondent violated McCormick Ranch CC&R’s Article III, Section 4, as it did not take the required vote, as well as and the Association CC&R’s Article VII, Section 1, by failing to follow the McCormick Ranch CC&R’s in regards to the same."

— ALJ Adam D. Stone, Final Decision (August 23, 2024). This quote summarizes the legal basis for the ruling, confirming that the Association is bound by the voting requirements of the incorporated documents.

"The letter also informed homeowners that there was a project cost of $1,557,950.00, which would be divided amongst the 166 homeowners, resulting in a special assessment in the amount of $9,385.24 per homeowner."

— Findings of Fact regarding Taylor Kidd's testimony. This provides the financial context of the dispute and the scale of the financial burden placed on the homeowners without their consent.

"While the Administrative Law Judge acknowledges that the decision to consolidate these matters is not required by the applicable rule, it is certainly permitted in this instance as these matters involve substantially similar factual or legal issues."

— ALJ Tammy L. Eigenheer, Order Consolidating Matters (May 28, 2024). This clarifies the standard for consolidation in administrative hearings, prioritizing "administrative economy."

"The document, consisting of Motion for Rehearing, will not be considered as no further action can be taken on the matter. All requests for rehearing must be made directly to the Arizona Department of Real Estate."

— ALJ Adam D. Stone, Minute Entry (September 23, 2024). This illustrates the finality of the OAH's role and the transition of the case back to the Department of Real Estate for any further administrative appeals.

Actionable Insights

  • Review Incorporation Clauses: Homeowners' associations must carefully review their governing documents for "incorporation by reference" clauses. If an HOA's documents incorporate the rules of a master association (like McCormick Ranch), those rules are legally binding even if they are more restrictive than the HOA's own specific bylaws.
  • Definition of Capital Improvements: Boards should clearly distinguish between routine maintenance and "capital improvements." While maintenance may fall under Board authority, major projects—especially those requiring significant special assessments—often trigger mandatory voting requirements.
  • Special Assessment Procedures: Before levying a special assessment, Boards must ensure they have met all procedural prerequisites, such as membership votes and quorum requirements, as dictated by the hierarchy of their governing documents.
  • Reimbursement Risks: Under ARIZ. REV. STAT. § 32-2199.02(A), if an Association is found in violation, they are legally required to reimburse the Petitioner’s filing fees. In this case, the Association was ordered to pay $1,000 total ($500 to each Petitioner).
  • Appellate Path: Parties dissatisfied with an ALJ decision must file their request for a rehearing with the Commissioner of the Department of Real Estate within 30 days of the order, rather than filing with the Office of Administrative Hearings.

Study Guide: Kidd and Glazer vs. Heritage Village III Homeowners Association

This study guide provides a comprehensive overview of the administrative legal proceedings between Petitioners Taylor Kidd and Jerome L. Glazer and the Respondent, Heritage Village III Homeowners Association. It covers procedural motions, governing legal standards, the core conflict regarding CC&Rs, and the final administrative decision.

1. Case Overview and Background

The dispute centered on a proposed Landscape Improvement Project initiated by the Heritage Village III Homeowners Association Board of Directors.

  • The Project: A $1,557,950.00 landscaping initiative intended to address dead/dying vegetation and a failing 40-year-old irrigation system.
  • The Assessment: The project cost was to be divided among 166 homeowners, resulting in a special assessment of $9,385.24 per homeowner.
  • The Dispute: Petitioners Kidd and Glazer alleged the Board approved this capital improvement and special assessment without the 75% or two-thirds homeowner vote required by governing documents.
  • The Venue: The Arizona Office of Administrative Hearings (OAH), acting on behalf of the Arizona Department of Real Estate (ADRE).

2. Key Legal Concepts and Standards

Administrative Procedures
  • Consolidation (ARIZ. ADMIN. CODE R2-19-109(A)): An Administrative Law Judge (ALJ) may consolidate pending matters if there are "substantially similar factual or legal issues" or if "all parties are the same." In this case, the matters were consolidated for administrative economy because they involved the same Board action, despite the petitioners being different individuals.
  • Continuance: A delay in proceedings. This occurred twice: once due to Petitioner Glazer’s domestic partner's surgery and once due to a widespread computer outage on July 19, 2024.
  • Jurisdiction: Under ARIZ. REV. STAT. §§ 32-2102 and 32-2199, the ADRE and OAH have the authority to hear disputes between homeowners and planned community associations regarding violations of community documents.
  • Burden of Proof: The Petitioner bears the burden of proving their case by a preponderance of the evidence.
Governing Documents
  • CC&Rs (Covenants, Conditions, and Restrictions): The primary rules governing the homeowners' association.
  • Incorporation by Reference: A legal mechanism where one document makes another document part of itself. Here, the Heritage Village III CC&Rs (Article VII, Section 1) incorporated the McCormick Ranch CC&Rs.

3. Chronology of Proceedings (2024)

Date Event Details
Feb 27–29 Petitions Filed Kidd and Glazer filed separate petitions with the ADRE ($500 fee each).
May 28 Consolidation Order ALJ Eigenheer consolidated cases 24F-H037-REL and 24F-H039-REL.
May 28 Cease & Desist Denied ALJ Eigenheer ruled the OAH lacked authority to stop HOA spending before a decision.
July 19 Original Hearing Date Postponed due to a computer outage.
Aug 9 Evidentiary Hearing Held before ALJ Adam D. Stone; testimony provided by Kidd, Glazer, and Board member Hutsko.
Aug 23 Final Decision ALJ Stone ruled in favor of Petitioners, finding the HOA violated CC&Rs.
Sept 23 Minute Entry OAH declined to hear a Motion for Rehearing, as such motions must be filed with the ADRE.

4. Short-Answer Practice Quiz

  1. What was the specific financial assessment proposed for each homeowner for the landscaping project?
  2. **According to ARIZ. ADMIN. CODE R2-19-109(A), what are the two conditions under which an ALJ may consolidate cases?**
  3. Why did the Administrative Law Judge deny Petitioner Glazer’s request for a Cease and Desist Order?
  4. What was the primary reason the Association argued they did not need a homeowner vote for the project?
  5. Which specific section of the McCormick Ranch CC&Rs requires a two-thirds vote for special assessments related to capital improvements?
  6. What was the final ruling regarding the filing fees paid by the Petitioners?
  7. What reason was given for the hearing continuance from July 19 to August 9, 2024?
  8. To which entity must a party submit a Motion for Rehearing after a final OAH decision has been issued?

5. Essay Questions for Deeper Exploration

  1. The Interplay of Governing Documents: Analyze how the "incorporation by reference" in Article VII, Section 1 of the Heritage Village III CC&Rs determined the outcome of the case. Why did the ALJ reject the Association's argument that they were only bound by "part" of the McCormick Ranch CC&Rs?
  2. Administrative Efficiency vs. Individual Rights: Discuss the arguments made for and against the consolidation of the Kidd and Glazer matters. How does ARIZ. ADMIN. CODE R2-19-109(A) balance the need for "administrative economy" with the rights of individual petitioners to have their specific grievances heard without delay?
  3. The Scope of ALJ Authority: Examine the ALJ’s decision to deny the Cease and Desist Order. What does this reveal about the limitations of the Office of Administrative Hearings compared to other judicial venues?

6. Glossary of Important Terms

  • Administrative Law Judge (ALJ): A judge who presides over hearings and adjudicates disputes involving government agencies.
  • Capital Improvement: Substantial permanent changes or additions to a property (e.g., the $1.5M landscaping and irrigation overhaul).
  • Cease and Desist Order: An order to stop a specific activity.
  • Consolidation: The joining of two or more separate legal cases into one because they involve similar issues.
  • Continuance: A postponement of a legal proceeding or hearing to a later date.
  • Minute Entry: A brief record of the court's actions or rulings on a specific motion or procedural matter.
  • Preponderance of the Evidence: The standard of proof in civil and administrative cases, meaning a fact is "more probably true than not."
  • Special Assessment: A one-time fee charged to HOA members for a specific project or expense outside the regular annual dues.
  • Tribunal: A person or institution (like the OAH) with the authority to judge or determine claims or disputes.

The $1.5 Million Landscape Lesson: How Two Homeowners Successfully Challenged Their HOA Board

1. Introduction: The High Cost of Silence

On December 19, 2023, the 166 homeowners of Heritage Village III in Hereford, Arizona, received a holiday "gift" they never requested: a formal notice announcing a massive landscaping overhaul and a mandatory special assessment of $9,385.24 per household. There had been no community vote, no formal presentation of costs, and no opportunity for homeowners to weigh in on a project totaling over $1.5 million.

While many might have simply grumbled at the mailbox, two residents decided to hold their Board accountable. Taylor Kidd, represented by counsel Patrick T. Nackley, and Jerome L. Glazer, appearing pro se (representing himself), filed petitions with the Arizona Department of Real Estate. Their challenge against the Heritage Village III Homeowners Association was more than a dispute over grass and trees; it was a fight for procedural transparency and the supremacy of governing documents. Their victory provides a masterclass in how homeowners can successfully check Board overreach.

2. The Project That Sparked the Protest

The "Landscape Improvement Project" approved by the Board in 2023 was not a minor facelift. It was a seven-figure overhaul funded entirely by a surprise levy on the residents. The project specifics included:

  • Total Estimated Cost: $1,557,950.00.
  • Individual Impact: A $9,385.24 special assessment for every homeowner.
  • The Board’s Justification: Directors argued the community was suffering from a 40-year-old irrigation system requiring constant patchwork repairs, alongside dozens of dead or diseased trees. They framed the project as a necessary move toward water conservation.

However, the human cost was significant. During her testimony, Ms. Kidd—who purchased her home in 2014 specifically for its lush green grass—noted the Board offered no concrete evidence of water savings to justify the loss of the community's aesthetic character. The Board had prioritized a massive capital replacement under the guise of simple maintenance.

3. Procedural Hurdles: Consolidation and Outages

The path to justice was marked by administrative delays and technical failures. The cases (24F-H037-REL and 24F-H039-REL) were eventually consolidated for "administrative economy" because they shared substantially similar legal questions.

The timeline was stretched by two major events:

  • A Motion to Continue: Granted on May 28, 2024, after Petitioner Glazer’s domestic partner required major back surgery.
  • A Technical Outage: A scheduled hearing on July 19, 2024, was derailed by a widespread computer outage, pushing the final showdown to August 9, 2024, before Administrative Law Judge (ALJ) Adam D. Stone.
4. The Legal Battle: Maintenance Duty vs. Membership Votes

The Board’s defense relied on a common but fatal trap: the belief that their general fiduciary duty to maintain the property gave them a "blank check" to bypass membership approval. They argued that because their specific local CC&Rs were silent on voting for such projects, they could proceed based on a community survey showing 72% support.

The Petitioners countered that the Board was ignoring the community's "Master" documents. The following table highlights the clash:

The Board's Defense The Petitioners' Argument
Claim: The Board has a fiduciary duty to maintain property; the 40-year-old irrigation system was failing. Rebuttal: A $1.5M replacement of an entire system is a "capital improvement," not routine maintenance.
Claim: Local CC&Rs are silent on voting requirements for improvements. Rebuttal: McCormick Ranch CC&Rs (Article III, Section 4) require a 2/3 vote for capital improvement assessments.
Claim: A survey showed 72% of the community supported the project. Rebuttal: A survey is not a legal vote. The McCormick Ranch rules are incorporated by reference and take supremacy.

The "Hidden Link": The Petitioners correctly identified that Article VII, Section 1 of the Heritage Village III CC&Rs explicitly incorporated the McCormick Ranch CC&Rs, stating they were "made part hereof and are hereby referenced."

5. The Verdict: Why the "Fine Print" Mattered

On August 23, 2024, ALJ Adam D. Stone issued a definitive ruling in favor of the homeowners. The decision turned on the legal interpretation of the phrase "including but not limited to."

The Association argued this phrase limited the incorporation of McCormick Ranch rules to matters of dues and collections. Judge Stone disagreed, ruling that "including but not limited to" is an inclusive phrase that expands rather than restricts. By referencing the McCormick Ranch documents, the Association effectively imported the entire suite of homeowner protections, including the requirement for a two-thirds (2/3) membership vote for any Special Assessment for Capital Improvements.

The ALJ concluded that the Board committed a clear violation of its governing documents. They could not rebrand a massive construction project as "maintenance" to circumvent the democratic rights of the membership.

6. The Cease and Desist Side-Note

Earlier in the dispute, on May 28, 2024, Petitioner Glazer had sought a Cease and Desist order to stop the Board from spending any funds on the project until the hearing concluded. While the Judge eventually ruled that the Board's actions were unauthorized, the request for a Cease and Desist was denied at that time. The ALJ clarified that the Office of Administrative Hearings (OAH) lacks the statutory authority to issue injunctive orders, noting that such relief must be sought in Superior Court or another appropriate venue.

7. Final Takeaways and Community Impact

This ruling is a significant win for homeowner rights in Arizona. Key lessons include:

  • Know Your Governing Documents: Always investigate if your local CC&Rs incorporate a master association’s rules. These "hidden links" often provide the strongest protections against Board overreach.
  • Surveys are Not Votes: A Board cannot use a "72% approval" survey to bypass a legally required formal vote. Procedural shortcuts are a breach of fiduciary duty.
  • The Cost of Non-Compliance: The HOA was ordered to reimburse the $500 filing fees to both Ms. Kidd and Mr. Glazer.
  • Project Status: Because the homeowners acted swiftly, the project had not yet commenced and the assessment had not been officially levied at the time of the ruling.
8. Important Notice for Readers

Following the ALJ’s decision, a Minute Entry was issued on September 23, 2024, regarding a Motion for Rehearing. Homeowners and Boards must take note: The OAH loses jurisdiction the moment a decision is rendered. Any motions for rehearing must be filed directly with the Arizona Department of Real Estate (ADRE) Commissioner, not the OAH. Attempting to file with the OAH after a decision is a procedural dead end.

Case Participants

Petitioner Side

  • Jerome L. Glazer (Petitioner)
    Filed petition pro se.
  • Taylor Kidd (Petitioner)
  • Brandon P. Bodea (Attorney)
    MEDALIST LEGAL PLC
  • Patrick T. Nackley (Attorney)
    MEDALIST LEGAL PLC
    Appeared at hearing as representation for Taylor Kidd.

Respondent Side

  • Charles H. Oldham (Attorney)
    CHDB Law LLP
  • Josh Bolen (Attorney)
    CHDB Law LLP
  • Tessa Knueppel (Attorney)
    CHDB Law LLP
    Appeared at hearing as representation for Heritage Village III Homeowners Association.
  • Mark K. Sahl (Attorney)
    CHDB Law LLP
    Appeared at hearing as representation for Heritage Village III Homeowners Association.
  • Jennifer Hutsko (Witness)
    Heritage Village III Homeowners Association
    Board of Directors member and Community Planning Committee member; testified for the respondent.

Neutral Parties

  • Tammy L. Eigenheer (Administrative Law Judge)
    Office of Administrative Hearings
    Issued initial procedural orders.
  • Susan Nicolson (Commissioner)
    Arizona Department of Real Estate
  • Adam D. Stone (Administrative Law Judge)
    Office of Administrative Hearings
    Presided over the hearing and issued the decision.

Taylor Kidd vs Heritage Village III Homeowners Association (ROOT)

Posted on by

Case Summary

Case ID 24F-H037-REL
Agency ADRE
Tribunal OAH
Decision Date 2024-08-23
Administrative Law Judge Adam D. Stone
Outcome The ALJ found that the Association violated its own CC&Rs (Article VII, Section 1) by failing to incorporate and follow Article III, Section 4 of the McCormick Ranch CC&Rs, which required a two-thirds vote of voting owners for a special assessment for capital improvements. Both petitions were granted, and the Association was ordered to refund the total filing fees of $1,000.00.
Filing Fees Refunded $1,000.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Taylor Kidd and Jerome L. Glazer Counsel Patrick T. Nackley
Respondent Heritage Village III Homeowners Association Counsel Tessa Knueppel and Mark K. Sahl

Alleged Violations

McCormick Ranch CC&R Article III, Section 4 and Heritage Village III HO CC&R Article VII, Section 1

Outcome Summary

The ALJ found that the Association violated its own CC&Rs (Article VII, Section 1) by failing to incorporate and follow Article III, Section 4 of the McCormick Ranch CC&Rs, which required a two-thirds vote of voting owners for a special assessment for capital improvements. Both petitions were granted, and the Association was ordered to refund the total filing fees of $1,000.00.

Why this result: Respondent failed to take the required vote regarding the special assessment for the Landscape Improvement Project, in violation of the controlling CC&Rs.

Key Issues & Findings

Violation of CC&Rs by approving a Landscape Improvement Project and potential special assessment for a capital improvement without the required 2/3 membership vote.

The Association violated its CC&Rs by failing to follow the McCormick Ranch CC&R provision requiring the assent of two-thirds (2/3) of the votes cast by Voting Owners for a Special Assessment intended for construction, reconstruction, repair, or replacement of a capital improvement (the Landscape Improvement Project).

Orders: The petitions were granted. Respondent was ordered to reimburse both Petitioners' filing fees pursuant to ARIZ. REV. STAT. § 32-2199.02(A).

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

  • McCormick Ranch CC&R Article III, Section 4
  • Association CC&R Article VII, Section 1

Analytics Highlights

Topics: Special Assessment, Capital Improvement, Membership Vote, CC&R Violation, Consolidation, Master Association
Additional Citations:

  • ARIZ. REV. STAT. § 32-2102
  • ARIZ. REV. STAT. § 32-2199 et al.
  • ARIZ. REV. STAT. § 32-2199.05
  • ARIZ. REV. STAT. §§ 32-2199(2), 32-2199.01(D), 32-2199.02, and 41-1092
  • ARIZ. REV. STAT. § 33-1803.7
  • ARIZ. REV. STAT. § 32-2199.02(A)
  • ARIZ. ADMIN. CODE R2-19-119
  • Title 33, Chapter 16, Article 1 of the Arizona Revised Statutes

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Video Overview

Audio Overview

Decision Documents

24F-H037-REL Decision – 1182719.pdf

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24F-H037-REL Decision – 1182767.pdf

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24F-H037-REL Decision – 1182769.pdf

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24F-H037-REL Decision – 1203525.pdf

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24F-H037-REL Decision – 1215299.pdf

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24F-H037-REL Decision – 1226570.pdf

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24F-H037-REL Decision – 1182719.pdf

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24F-H037-REL Decision – 1182767.pdf

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24F-H037-REL Decision – 1182769.pdf

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24F-H037-REL Decision – 1203525.pdf

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24F-H037-REL Decision – 1215299.pdf

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24F-H037-REL Decision – 1226570.pdf

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This summary details the proceedings, key arguments, and final decision in the consolidated matters of *Taylor Kidd and Jerome L. Glazer vs. Heritage Village III Homeowners Association* (Nos. 24F-H037-REL and 24F-H039-REL).

Key Facts and Procedural History

The Petitioners, Taylor Kidd and Jerome L. Glazer, who are members of the Heritage Village III Homeowners Association (Association), filed separate petitions objecting to the Association's approval of a Landscape Improvement Project (LIP). The Association requested, and the Administrative Law Judge (ALJ) granted, consolidation of the two matters due to them involving substantially similar factual or legal issues and for purposes of administrative efficiency. The hearings were continued several times and ultimately held on August 9, 2024.

The LIP involved an estimated cost of $1,557,950.00 (potentially up to $2 million) for the replacement of a 40-year-old irrigation system, grass removal, and replacement with decomposed granite and native plants. The Association communicated in December 2023 that this cost would result in a special assessment of $9,385.24 per homeowner. A request by Petitioner Glazer for a Cease and Desist Order to prevent the expenditure of funds related to the LIP was denied by the ALJ due to a lack of authority in that venue.

Main Issues and Key Arguments

The central legal dispute was whether the Association could approve the LIP and levy the special assessment solely through a Board vote, or if a membership vote was required under the governing documents.

Petitioners' Argument:

Petitioners argued that the LIP was a capital improvement project. They contended that the Association's CC&Rs (Article VII, Section 1) required it to follow the McCormick Ranch CC&Rs (Master Association). The McCormick Ranch CC&Rs (Article III, Section 4) mandate that a special assessment for a capital improvement requires the assent of two-thirds (2/3) of the votes cast by Voting Owners. Petitioners asserted the Board refused to hold this vote.

Respondent's Argument:

The Association argued the Board has the duty and authority to maintain the common area (which included addressing dead/dying grass and a damaged irrigation system), and that the LIP fell under this authority. They claimed the special assessment had not yet been levied. Legally, the Association argued that the requirement for a 2/3 membership vote in the McCormick Ranch documents applied only to the Master Association itself (referenced by the capitalized word "Association") and did not govern subsidiary associations like Heritage Village III, whose own documents were silent on requiring a member vote for such projects.

Final Decision and Outcome

The ALJ, Adam D. Stone, issued a decision on August 23, 2024.

Legal Conclusion: The ALJ found that the Petitioners met their burden of proof. The decision hinged on the interpretation of Article VII, Section 1 of the Association’s CC&Rs, which states that McCormick Ranch provisions apply, "including but not limited to" the assessment, lien, and collection of dues.

The ALJ ruled it would be inconsistent to assume that the section requiring a 2/3 vote for capital improvements (McCormick Ranch CC&R Article III, Section 4) would be excluded.

Outcome:

IT IS ORDERED that Petitioners’ petitions in these matters are granted. The Association was found to have violated McCormick Ranch CC&R’s Article III, Section 4, and its own CC&R’s Article VII, Section 1, by failing to take the required vote. The Respondent was ordered to reimburse both Petitioners’ filing fees.

A Motion for Rehearing filed by a party was later noted by the ALJ as not being considered, directing that such requests must be made directly to the Arizona Department of Real Estate.

Questions

Question

Can I petition the Arizona Department of Real Estate for a hearing if my HOA violates the CC&Rs?

Short Answer

Yes, owners may petition the department for hearings regarding violations of community documents or statutes regulating planned communities.

Detailed Answer

The Department has jurisdiction over disputes between owners and associations. An owner can petition for a hearing concerning violations of the community's governing documents (CC&Rs) or state statutes, provided they file the petition and pay the required fee.

Alj Quote

regarding a dispute between an owner and a planned community association, the owner or association may petition the department for a hearing concerning violations of community documents or violations of the statutes that regulate planned communities as long as the petitioner has filed a petition with the department and paid a filing fee

Legal Basis

ARIZ. REV. STAT. §§ 32-2102 and 32-2199

Topic Tags

  • jurisdiction
  • homeowner rights
  • petition process

Question

What is the standard of proof I must meet to win a hearing against my HOA?

Short Answer

You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probably true than not.

Detailed Answer

The burden of proof lies with the petitioner (the homeowner). They must demonstrate that the violation occurred by a preponderance of the evidence, which is defined as evidence that convinces the judge that the claim is more likely true than not.

Alj Quote

Petitioner bears the burden of proving by a preponderance of the evidence… 'A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.'

Legal Basis

ARIZ. ADMIN. CODE R2-19-119

Topic Tags

  • legal standards
  • burden of proof
  • evidence

Question

If my specific subdivision's CC&Rs are silent on a rule, but the Master Association's CC&Rs address it, which rules apply?

Short Answer

The Master Association's rules likely apply if your subdivision's CC&Rs reference or incorporate the Master documents.

Detailed Answer

In this case, the sub-association's CC&Rs did not explicitly require a vote for capital improvements, but the Master Association's CC&Rs did. Because the sub-association's documents contained language incorporating the Master provisions ('including but not limited to'), the Master Association's requirement for a homeowner vote applied.

Alj Quote

Based upon the foregoing, Petitioners met their burdens of proof in demonstrating that the Association was in violation the CC&R’s as it would be inconsistent to assume that only part of Article III of the McCormick Ranch’s CC&R’s would apply to the Association while Section 4 would somehow be excluded.

Legal Basis

CC&R Interpretation

Topic Tags

  • CC&Rs
  • master association
  • governing documents

Question

Does the HOA need a homeowner vote to pass a special assessment for a capital improvement?

Short Answer

Yes, if the controlling CC&Rs require it. In this case, a 2/3 vote of voting owners was required.

Detailed Answer

The decision affirmed that the Association violated the governing documents by failing to hold a vote. The controlling Master CC&Rs specifically required approval by two-thirds of the voting owners for special assessments related to the construction, repair, or replacement of capital improvements.

Alj Quote

provided that any such assessment shall have the assent of two-thirds (2/3) of the votes cast by Voting Owners in person or by proxy at a meeting duly called for such purpose

Legal Basis

Master CC&R Article III, Section 4

Topic Tags

  • special assessments
  • voting rights
  • capital improvements

Question

If I successfully prove my HOA violated the rules, can I get my filing fees back?

Short Answer

Yes, the Administrative Law Judge can order the HOA to reimburse the filing fees.

Detailed Answer

Upon finding that the Association violated the CC&Rs, the judge ordered the Respondent (the HOA) to reimburse the filing fees paid by the Petitioners to the Department of Real Estate.

Alj Quote

Respondent shall reimburse both Petitioner’s filing fees as required by ARIZ. REV. STAT. § 32-2199.01.

Legal Basis

ARIZ. REV. STAT. § 32-2199.01

Topic Tags

  • penalties
  • reimbursement
  • fees

Case

Docket No
24F-H037-REL, 24F-H039-REL
Case Title
Taylor Kidd and Jerome L. Glazer vs Heritage Village III Homeowners Association
Decision Date
2024-08-23
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Questions

Question

Can I petition the Arizona Department of Real Estate for a hearing if my HOA violates the CC&Rs?

Short Answer

Yes, owners may petition the department for hearings regarding violations of community documents or statutes regulating planned communities.

Detailed Answer

The Department has jurisdiction over disputes between owners and associations. An owner can petition for a hearing concerning violations of the community's governing documents (CC&Rs) or state statutes, provided they file the petition and pay the required fee.

Alj Quote

regarding a dispute between an owner and a planned community association, the owner or association may petition the department for a hearing concerning violations of community documents or violations of the statutes that regulate planned communities as long as the petitioner has filed a petition with the department and paid a filing fee

Legal Basis

ARIZ. REV. STAT. §§ 32-2102 and 32-2199

Topic Tags

  • jurisdiction
  • homeowner rights
  • petition process

Question

What is the standard of proof I must meet to win a hearing against my HOA?

Short Answer

You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probably true than not.

Detailed Answer

The burden of proof lies with the petitioner (the homeowner). They must demonstrate that the violation occurred by a preponderance of the evidence, which is defined as evidence that convinces the judge that the claim is more likely true than not.

Alj Quote

Petitioner bears the burden of proving by a preponderance of the evidence… 'A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.'

Legal Basis

ARIZ. ADMIN. CODE R2-19-119

Topic Tags

  • legal standards
  • burden of proof
  • evidence

Question

If my specific subdivision's CC&Rs are silent on a rule, but the Master Association's CC&Rs address it, which rules apply?

Short Answer

The Master Association's rules likely apply if your subdivision's CC&Rs reference or incorporate the Master documents.

Detailed Answer

In this case, the sub-association's CC&Rs did not explicitly require a vote for capital improvements, but the Master Association's CC&Rs did. Because the sub-association's documents contained language incorporating the Master provisions ('including but not limited to'), the Master Association's requirement for a homeowner vote applied.

Alj Quote

Based upon the foregoing, Petitioners met their burdens of proof in demonstrating that the Association was in violation the CC&R’s as it would be inconsistent to assume that only part of Article III of the McCormick Ranch’s CC&R’s would apply to the Association while Section 4 would somehow be excluded.

Legal Basis

CC&R Interpretation

Topic Tags

  • CC&Rs
  • master association
  • governing documents

Question

Does the HOA need a homeowner vote to pass a special assessment for a capital improvement?

Short Answer

Yes, if the controlling CC&Rs require it. In this case, a 2/3 vote of voting owners was required.

Detailed Answer

The decision affirmed that the Association violated the governing documents by failing to hold a vote. The controlling Master CC&Rs specifically required approval by two-thirds of the voting owners for special assessments related to the construction, repair, or replacement of capital improvements.

Alj Quote

provided that any such assessment shall have the assent of two-thirds (2/3) of the votes cast by Voting Owners in person or by proxy at a meeting duly called for such purpose

Legal Basis

Master CC&R Article III, Section 4

Topic Tags

  • special assessments
  • voting rights
  • capital improvements

Question

If I successfully prove my HOA violated the rules, can I get my filing fees back?

Short Answer

Yes, the Administrative Law Judge can order the HOA to reimburse the filing fees.

Detailed Answer

Upon finding that the Association violated the CC&Rs, the judge ordered the Respondent (the HOA) to reimburse the filing fees paid by the Petitioners to the Department of Real Estate.

Alj Quote

Respondent shall reimburse both Petitioner’s filing fees as required by ARIZ. REV. STAT. § 32-2199.01.

Legal Basis

ARIZ. REV. STAT. § 32-2199.01

Topic Tags

  • penalties
  • reimbursement
  • fees

Case

Docket No
24F-H037-REL, 24F-H039-REL
Case Title
Taylor Kidd and Jerome L. Glazer vs Heritage Village III Homeowners Association
Decision Date
2024-08-23
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Taylor Kidd (petitioner)
  • Jerome L. Glazer (petitioner)
    Appeared on his own behalf
  • Patrick T. Nackley (petitioner attorney)
    MEDALIST LEGAL PLC
    Represented Petitioner Taylor Kidd
  • Brandon P. Bodea (petitioner attorney)
    MEDALIST LEGAL PLC
  • Jack Sales (homeowner)
    Co-authored a letter to the Board with Petitioner Glazer

Respondent Side

  • Jennifer Hutsko (board member/witness)
    Heritage Village III Homeowners Association
    Director and member of the Community Planning Committee
  • Glenn Martyr (board member)
    Heritage Village III Homeowners Association
    Seconded motion in meeting minutes
  • Steve Wolf (board member)
    Heritage Village III Homeowners Association
    Seconded motion in meeting minutes
  • Tessa Knueppel (respondent attorney)
    CHDB Law LLP
    Represented Respondent at hearing
  • Mark K. Sahl (respondent attorney)
    CHDB Law LLP
    Represented Respondent at hearing
  • Charles H. Oldham (respondent attorney)
    CHDB Law LLP
  • Josh Bolen (respondent attorney)
    CHDB Law LLP

Neutral Parties

  • Adam D. Stone (ALJ)
    OAH
    Conducted hearing and issued Decision
  • Tammy L. Eigenheer (ALJ)
    OAH
    Signed consolidation order
  • Susan Nicolson (Commissioner)
    ADRE

Aaron Solen & Anh Jung v. Power Ranch Community Association

Posted on by

Case Summary

Case ID 24F-H036-REL
Agency ADRE
Tribunal OAH
Decision Date 2024-07-05
Administrative Law Judge Adam D. Stone
Outcome The tribunal granted the petition, finding the Association violated ARIZ. REV. STAT. § 33-1803(B) and CC&R section 5.2.3 by failing to provide Petitioners an opportunity to be heard before imposing monetary penalties. The Respondent was ordered to reimburse the $500 filing fee. However, the tribunal denied all other requests for relief, including the reimbursement of fines, imposition of civil penalties, and forced approval of the modification, citing lack of statutory authority.
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Aaron Solen and Anh Jung Counsel —
Respondent Power Ranch Community Association Counsel Charles H. Oldham

Alleged Violations

A.R.S. §33-1803(B) and Article 5.2.4 of the Association’s by-laws

Outcome Summary

The tribunal granted the petition, finding the Association violated ARIZ. REV. STAT. § 33-1803(B) and CC&R section 5.2.3 by failing to provide Petitioners an opportunity to be heard before imposing monetary penalties. The Respondent was ordered to reimburse the $500 filing fee. However, the tribunal denied all other requests for relief, including the reimbursement of fines, imposition of civil penalties, and forced approval of the modification, citing lack of statutory authority.

Why this result: The tribunal lacks statutory authority to erase fines imposed, force the Association to rewrite its CC&R’s, or force the Association to accept the planters without Petitioners going through the proper Design Review Committee processes.

Key Issues & Findings

Petitioner was issued fines as a result of a Design Review Committee decision and petitioner was not provided an opportunity to appeal to or be heard by the board of directors as required by A.R.S. §33-1803(B) and Article 5, specifically Article 5.2.4 of the Association’s by-laws.

Petitioners were fined for an unapproved modification (planter) without being granted a proper opportunity to be heard by the Board, as required by statute and bylaws, leading to a violation finding against the Association. The May 2023 meeting did not include the hearing, and the June 2023 Executive Session was not deemed a proper 'hearing' due to confusion over the closed session terminology.

Orders: The petition alleging violation of hearing rights was granted. Respondent was ordered to reimburse the Petitioner’s filing fee pursuant to ARIZ. REV. STAT. § 32-2199.02(A). Requests for reimbursement of fines incurred ($400.00), approval of the planters, imposition of a civil penalty, and rewriting CC&R’s procedures were denied.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

  • ARIZ. REV. STAT. § 33-1803(B)
  • Article 5.2.4
  • CC&R Section 5.2.3
  • ARIZ. REV. STAT. § 32-2199.02(A)

Analytics Highlights

Topics: DRC denial, hearing rights, monetary penalty, unapproved modification, executive session, CC&R violation
Additional Citations:

  • ARIZ. REV. STAT. § 33-1803(B)
  • Article 5.2.4
  • CC&R Section 5.2.3
  • ARIZ. REV. STAT. § 32-2199.02(A)
  • ARIZ. REV. STAT. § 32-2199.01
  • ARIZ. REV. STAT. §§ 32-2102
  • ARIZ. REV. STAT. § 41-1092

Video Overview

Audio Overview

Decision Documents

24F-H036-REL Decision – 1162665.pdf

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24F-H036-REL Decision – 1184634.pdf

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24F-H036-REL Decision – 1191323.pdf

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24F-H036-REL Decision – 1196403.pdf

Uploaded 2026-04-24T12:22:27 (146.0 KB)

24F-H036-REL Decision – 1162665.pdf

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24F-H036-REL Decision – 1184634.pdf

Uploaded 2026-01-23T18:06:33 (40.0 KB)

24F-H036-REL Decision – 1191323.pdf

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24F-H036-REL Decision – 1196403.pdf

Uploaded 2026-01-23T18:06:42 (146.0 KB)

This summary details the hearing before the Office of Administrative Hearings (OAH) in the matter of *Aaron Solen and Anh Jung (Petitioners) vs. Power Ranch Community Association (Respondent)* (No. 24F-H036-REL).

Key Facts and Background

The dispute centered on the installation of an unapproved planter in the Petitioners' front yard. Following a courtesy notice on March 9, 2023, Petitioners submitted a Design Review Committee (DRC) Application, which was denied on April 10, 2023, for not aligning with community aesthetics and being "too large". Petitioners subsequently modified the planter but refused to submit a formal modification application, arguing that the governing documents (CC&Rs) only required modification or new information, not another form, to be granted an appeal.

The Association (Respondent) argued that a formal written application was essential for maintaining accurate written records, especially given the community's size (15,000 members). Although the violation was first noted in March 2023, the Association delayed imposing $100 fines until October 2023, attempting to work with Petitioners to resolve the issue.

Main Issues and Arguments

  1. Violation of Hearing Rights: Petitioners argued they were fined without being provided a proper opportunity to appeal or be heard by the Board of Directors, violating A.R.S. § 33-1803(B) and Article 5.2.4 of the Association's bylaws.
  2. Appeal Procedure: The Board failed to address Petitioners' appeal at the May 22, 2023 meeting because it intended to give Petitioners time to cure the violation and avoid a "final decision".
  3. Executive Session as Hearing: The Association claimed that the invitation to the June 26, 2023 Executive Session was intended to serve as the appeal hearing. Petitioners did not attend, believing executive sessions were closed to homeowners.

Outcome and Legal Decision

The Administrative Law Judge (ALJ) Adam D. Stone granted the Petition.

The ALJ made the following key legal conclusions:

  • Standing: The ALJ confirmed that Petitioners (as members residing at the property) were the proper parties to the action, rejecting the Respondent's argument that only the LLC (the title owner) had standing.
  • Due Process Violation: The tribunal found Petitioners met their burden of proof that the opportunity to have a hearing was not granted.
  • The May meeting delay, though a "noble gesture," still denied Petitioners their statutory right to a hearing.
  • The June Executive Session was found insufficient as a "hearing" due to the confusion its terminology caused, denying the "opportunity to be heard".
  • Final Ruling: The Association violated ARIZ. REV. STAT. § 33-1803(B) (requiring notice and opportunity to be heard before imposing penalties) and CC&R's section 5.2.3.

Remedies

While granting the Petition, the ALJ noted he lacked statutory authority to grant several requested remedies:

  • The ALJ could not erase the fines imposed.
  • The ALJ could not force the Association to approve the planters without Petitioners following the proper DRC procedures.
  • The ALJ denied the request to force the Association to rewrite its CC&R’s.

The only monetary relief ordered was that the Respondent reimburse the Petitioners’ filing fee.

{
“case”: {
“docket_no”: “24F-H036-REL”,
“case_title”: “Aaron Solen & Anh Jung vs Power Ranch Community Association”,
“decision_date”: “2024-07-05”,
“alj_name”: “Adam D. Stone”,
“tribunal”: “OAH”,
“agency”: “ADRE”
},
“questions”: [
{
“question”: “Does the HOA have to provide a hearing before imposing fines?”,
“short_answer”: “Yes, state law requires notice and an opportunity to be heard before monetary penalties are imposed.”,
“detailed_answer”: “The decision cites Arizona Revised Statutes, which mandate that a board of directors may only impose reasonable monetary penalties after providing the member with notice and an opportunity to be heard regarding the violation.”,
“alj_quote”: “After notice and an opportunity to be heard, the board of directors may impose reasonable monetary penalties on members for violations of the declaration, bylaws and rules of the association.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“fines”,
“hearings”,
“due process”
]
},
{
“question”: “Can the Administrative Law Judge order the HOA to remove fines from my account?”,
“short_answer”: “No, the tribunal stated it lacks the statutory authority to erase fines.”,
“detailed_answer”: “Even if the homeowner prevails on the procedural issue (like lack of a hearing), the ALJ in this case ruled that they do not have the power to order the fines be removed or erased.”,
“alj_quote”: “However, the tribunal has no statutory authority to erase the fines imposed nor force the Association to rewrite its CC&R’s”,
“legal_basis”: “Administrative Authority”,
“topic_tags”: [
“fines”,
“remedies”,
“jurisdiction”
]
},
{
“question”: “Can the ALJ force the HOA to approve my architectural modification (e.g., planters)?”,
“short_answer”: “No, the tribunal cannot force the HOA to accept improvements that haven’t gone through the proper design review process.”,
“detailed_answer”: “The ALJ denied the request to force approval of the unapproved planters, noting that the homeowners must still go through the association’s Design Review Committee (DRC) processes.”,
“alj_quote”: “nor can it force the Association to accept the planters as is without Petitioners going through the property DRC processes.”,
“legal_basis”: “Administrative Authority”,
“topic_tags”: [
“architectural review”,
“landscaping”,
“remedies”
]
},
{
“question”: “Is an invitation to an ‘Executive Session’ sufficient to satisfy the requirement for a hearing?”,
“short_answer”: “Not necessarily, especially if the terminology is confusing and leads homeowners to believe they cannot attend.”,
“detailed_answer”: “In this case, the ALJ found that inviting homeowners to an Executive Session—which is generally understood to be closed to the public—was confusing. Because the homeowners believed they couldn’t attend, the session did not count as a valid opportunity to be heard.”,
“alj_quote”: “Thus, the tribunal finds that the June 2023 Executive Session was not a “hearing” for purposes of the CC&R’s, and it was not an opportunity to be heard based upon the confusion the Executive Session terminology caused.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“hearings”,
“executive session”,
“meetings”
]
},
{
“question”: “If I own my home through an LLC, can I still file a petition against the HOA?”,
“short_answer”: “Yes, provided you are the member residing at the property and the HOA has treated you as the owner.”,
“detailed_answer”: “The HOA argued the petition was deficient because the title was held by an LLC. The ALJ rejected this, finding the residents were the proper parties because they were members of the association and the HOA sent mail to them individually.”,
“alj_quote”: “At the outset, the tribunal finds that Petitioners are the proper parties to the action. They are the members of the Association, and all mail went directly to Petitioners individually, and not as a member/manager of the LLC.”,
“legal_basis”: “Standing”,
“topic_tags”: [
“LLC ownership”,
“standing”,
“membership”
]
},
{
“question”: “If I win my hearing against the HOA, will I get my filing fee back?”,
“short_answer”: “Yes, the ALJ can order the HOA to reimburse the filing fee.”,
“detailed_answer”: “The decision ordered the Respondent (the HOA) to reimburse the Petitioner’s filing fee pursuant to Arizona statutes.”,
“alj_quote”: “IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall reimburse Petitioner’s filing fee as required by ARIZ. REV. STAT. § 32-2199.01.”,
“legal_basis”: “A.R.S. § 32-2199.02(A)”,
“topic_tags”: [
“fees”,
“reimbursement”,
“costs”
]
},
{
“question”: “Can the Board delay my hearing to give me time to fix a violation instead of hearing my appeal?”,
“short_answer”: “No, if you requested a hearing, the Board should address it rather than delaying it indefinitely.”,
“detailed_answer”: “The Board delayed the hearing to avoid issuing a final denial, hoping the homeowner would fix the issue. The ALJ ruled that while well-intentioned (“noble gesture”), this delay violated the homeowner’s right to be heard when the matter was not addressed at the monthly meetings.”,
“alj_quote”: “Therefore, although the Board was most generous in delaying the “hearing” to avoid a final decision, the matter should have been addressed in May and June at the monthly meetings and it was not.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“hearings”,
“delays”,
“board conduct”
]
},
{
“question”: “Can the ALJ impose civil penalties on the HOA for their actions?”,
“short_answer”: “It is possible but was denied in this specific case.”,
“detailed_answer”: “The homeowners requested civil penalties against the HOA. The ALJ explicitly denied this request in the final order.”,
“alj_quote”: “IT IS FURTHER ORDERED denying Petitioners’ request for the imposition of a civil penalty…”,
“legal_basis”: “Administrative Discretion”,
“topic_tags”: [
“civil penalties”,
“sanctions”
]
}
]
}

{
“case”: {
“docket_no”: “24F-H036-REL”,
“case_title”: “Aaron Solen & Anh Jung vs Power Ranch Community Association”,
“decision_date”: “2024-07-05”,
“alj_name”: “Adam D. Stone”,
“tribunal”: “OAH”,
“agency”: “ADRE”
},
“questions”: [
{
“question”: “Does the HOA have to provide a hearing before imposing fines?”,
“short_answer”: “Yes, state law requires notice and an opportunity to be heard before monetary penalties are imposed.”,
“detailed_answer”: “The decision cites Arizona Revised Statutes, which mandate that a board of directors may only impose reasonable monetary penalties after providing the member with notice and an opportunity to be heard regarding the violation.”,
“alj_quote”: “After notice and an opportunity to be heard, the board of directors may impose reasonable monetary penalties on members for violations of the declaration, bylaws and rules of the association.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“fines”,
“hearings”,
“due process”
]
},
{
“question”: “Can the Administrative Law Judge order the HOA to remove fines from my account?”,
“short_answer”: “No, the tribunal stated it lacks the statutory authority to erase fines.”,
“detailed_answer”: “Even if the homeowner prevails on the procedural issue (like lack of a hearing), the ALJ in this case ruled that they do not have the power to order the fines be removed or erased.”,
“alj_quote”: “However, the tribunal has no statutory authority to erase the fines imposed nor force the Association to rewrite its CC&R’s”,
“legal_basis”: “Administrative Authority”,
“topic_tags”: [
“fines”,
“remedies”,
“jurisdiction”
]
},
{
“question”: “Can the ALJ force the HOA to approve my architectural modification (e.g., planters)?”,
“short_answer”: “No, the tribunal cannot force the HOA to accept improvements that haven’t gone through the proper design review process.”,
“detailed_answer”: “The ALJ denied the request to force approval of the unapproved planters, noting that the homeowners must still go through the association’s Design Review Committee (DRC) processes.”,
“alj_quote”: “nor can it force the Association to accept the planters as is without Petitioners going through the property DRC processes.”,
“legal_basis”: “Administrative Authority”,
“topic_tags”: [
“architectural review”,
“landscaping”,
“remedies”
]
},
{
“question”: “Is an invitation to an ‘Executive Session’ sufficient to satisfy the requirement for a hearing?”,
“short_answer”: “Not necessarily, especially if the terminology is confusing and leads homeowners to believe they cannot attend.”,
“detailed_answer”: “In this case, the ALJ found that inviting homeowners to an Executive Session—which is generally understood to be closed to the public—was confusing. Because the homeowners believed they couldn’t attend, the session did not count as a valid opportunity to be heard.”,
“alj_quote”: “Thus, the tribunal finds that the June 2023 Executive Session was not a “hearing” for purposes of the CC&R’s, and it was not an opportunity to be heard based upon the confusion the Executive Session terminology caused.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“hearings”,
“executive session”,
“meetings”
]
},
{
“question”: “If I own my home through an LLC, can I still file a petition against the HOA?”,
“short_answer”: “Yes, provided you are the member residing at the property and the HOA has treated you as the owner.”,
“detailed_answer”: “The HOA argued the petition was deficient because the title was held by an LLC. The ALJ rejected this, finding the residents were the proper parties because they were members of the association and the HOA sent mail to them individually.”,
“alj_quote”: “At the outset, the tribunal finds that Petitioners are the proper parties to the action. They are the members of the Association, and all mail went directly to Petitioners individually, and not as a member/manager of the LLC.”,
“legal_basis”: “Standing”,
“topic_tags”: [
“LLC ownership”,
“standing”,
“membership”
]
},
{
“question”: “If I win my hearing against the HOA, will I get my filing fee back?”,
“short_answer”: “Yes, the ALJ can order the HOA to reimburse the filing fee.”,
“detailed_answer”: “The decision ordered the Respondent (the HOA) to reimburse the Petitioner’s filing fee pursuant to Arizona statutes.”,
“alj_quote”: “IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall reimburse Petitioner’s filing fee as required by ARIZ. REV. STAT. § 32-2199.01.”,
“legal_basis”: “A.R.S. § 32-2199.02(A)”,
“topic_tags”: [
“fees”,
“reimbursement”,
“costs”
]
},
{
“question”: “Can the Board delay my hearing to give me time to fix a violation instead of hearing my appeal?”,
“short_answer”: “No, if you requested a hearing, the Board should address it rather than delaying it indefinitely.”,
“detailed_answer”: “The Board delayed the hearing to avoid issuing a final denial, hoping the homeowner would fix the issue. The ALJ ruled that while well-intentioned (“noble gesture”), this delay violated the homeowner’s right to be heard when the matter was not addressed at the monthly meetings.”,
“alj_quote”: “Therefore, although the Board was most generous in delaying the “hearing” to avoid a final decision, the matter should have been addressed in May and June at the monthly meetings and it was not.”,
“legal_basis”: “A.R.S. § 33-1803(B)”,
“topic_tags”: [
“hearings”,
“delays”,
“board conduct”
]
},
{
“question”: “Can the ALJ impose civil penalties on the HOA for their actions?”,
“short_answer”: “It is possible but was denied in this specific case.”,
“detailed_answer”: “The homeowners requested civil penalties against the HOA. The ALJ explicitly denied this request in the final order.”,
“alj_quote”: “IT IS FURTHER ORDERED denying Petitioners’ request for the imposition of a civil penalty…”,
“legal_basis”: “Administrative Discretion”,
“topic_tags”: [
“civil penalties”,
“sanctions”
]
}
]
}

Case Participants

Petitioner Side

  • Aaron Solen (petitioner)
    ACRE Holdings, LLC
  • Anh Jung (petitioner)
    ACRE Holdings, LLC
    Also known as Ann Young

Respondent Side

  • Charles H. Oldham (HOA attorney)
    CHDB Law LLP
  • Jennifer Partridge (property manager/witness)
    CCMC
    Also known as Jennifer Campbell; Executive Director for Power Ranch
  • Nick Ferre (property manager)
    CCMC
    Jennifer Partridge's supervisor
  • Allison Sanchez (property manager)
    CCMC
  • Chris Ecknar (board member)
    Power Ranch Community Association
    Listed attendee in contested board minutes exhibit
  • Josh Bolen (HOA attorney)
    CHDB Law LLP
  • Marcus R. Martinez (HOA attorney)
    Carpenter Hazlewood
    Listed in early transmission list with Respondent's counsel
  • Curtis Mark (HOA attorney)
    Power Ranch Community Association
    Association attorney

Neutral Parties

  • Adam D. Stone (ALJ)
    OAH
  • Susan Nicolson (commissioner)
    ADRE

Other Participants

  • Sherikillo (witness)
    Neighbor
    Confirmed petitioner's topic was raised at May 2023 board meeting

George Holub v. 3 Canyons Ranch Master

Posted on by

Case Summary

Case ID 24F-H021-REL
Agency ADRE
Tribunal OAH
Decision Date 2024-02-12
Administrative Law Judge Adam D. Stone
Outcome Petitioner's petition alleging violations of ARIZ. REV. STAT. § 33-1803 regarding assessment increase and fine imposition was denied in its entirety. The Administrative Law Judge found Petitioner failed to meet the burden of proof, concluding the HOA did not violate the statute.
Filing Fees Refunded $1,000.00
Civil Penalties $0.00

Parties & Counsel

Petitioner George Holub Counsel —
Respondent 3 Canyons Ranch Master Homeowners’ Association Counsel Marcus Martinez, Esq.

Alleged Violations

ARIZ. REV. STAT. § 33-1803(A)
ARIZ. REV. STAT. § 33-1803(B), (C), (D), (E)

Outcome Summary

Petitioner's petition alleging violations of ARIZ. REV. STAT. § 33-1803 regarding assessment increase and fine imposition was denied in its entirety. The Administrative Law Judge found Petitioner failed to meet the burden of proof, concluding the HOA did not violate the statute.

Why this result: Petitioner did not meet the burden of proving by a preponderance of the evidence that the Association violated ARIZ. REV. STAT. § 33-1803, as the assessment error was corrected and the notice requirements for the fine were met.

Key Issues & Findings

Assessment Increase

Petitioner alleged the yearly assessment increased from $525.00 to $1,010.00, violating ARS § 33-1803(A). The HOA claimed this was a clerical error that was promptly corrected to $525.00.

Orders: Petitioner failed to meet the burden of proof, as the evidence showed the assessment error was immediately corrected, resulting in no statutory violation.

Filing fee: $1,000.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • ARIZ. REV. STAT. § 33-1803(A)
  • ARIZ. REV. STAT. § 33-1803

Imposition of fine without proper notice

Petitioner challenged a $500 fine for commencing construction of a courtyard wall without prior approval. Petitioner claimed insufficient notice, while the HOA asserted notice was provided via email, satisfying statutory requirements.

Orders: Petitioner failed to meet the burden of proof. The email notice complied with statutory requirements. The Association was ordered not to reimburse the filing fee.

Filing fee: $1,000.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • ARIZ. REV. STAT. § 33-1803(B)
  • ARIZ. REV. STAT. § 33-1803(C)
  • ARIZ. REV. STAT. § 33-1803(D)
  • ARIZ. REV. STAT. § 33-1803(E)
  • ARIZ. REV. STAT. § 33-1803

Video Overview

Audio Overview

Decision Documents

24F-H021-REL Decision – 1114406.pdf

Uploaded 2026-04-24T12:16:19 (48.9 KB)

24F-H021-REL Decision – 1114407.pdf

Uploaded 2026-04-24T12:16:22 (6.6 KB)

24F-H021-REL Decision – 1135788.pdf

Uploaded 2026-04-24T12:16:25 (57.8 KB)

24F-H021-REL Decision – 1143255.pdf

Uploaded 2026-04-24T12:16:29 (124.1 KB)

24F-H021-REL Decision – 1114406.pdf

Uploaded 2026-01-23T18:03:08 (48.9 KB)

24F-H021-REL Decision – 1114407.pdf

Uploaded 2026-01-23T18:03:11 (6.6 KB)

24F-H021-REL Decision – 1135788.pdf

Uploaded 2026-01-23T18:03:15 (57.8 KB)

24F-H021-REL Decision – 1143255.pdf

Uploaded 2026-01-23T18:03:18 (124.1 KB)

The hearing summary for *George Holub v. 3 Canyons Ranch Master Homeowners’ Association* (No. 24F-H021-REL) addresses allegations that the Homeowners’ Association (HOA) violated the Arizona Planned Communities Act regarding assessments and fines.

Case Overview and Key Issues

The case was heard by Administrative Law Judge (ALJ) Adam D. Stone at the Office of Administrative Hearings (OAH) on January 26, 2024. Petitioner George Holub filed a two-issue petition, alleging the Respondent HOA violated ARIZ. REV. STAT. § 33-1803.

The main issues were:

  1. Assessment Increase: The HOA allegedly "nearly doubled the assessment amount from previous year," violating the statutory limit that prevents increases over twenty percent without a majority member vote (ARS 33-1803(A)).
  2. Improper Fine: The HOA allegedly "imposed violation fee without first discussing the violation with [Petitioner] in front of the board members". This concerned a $500 fine levied for unapproved construction.

Key Arguments and Proceedings

Petitioner's Argument (George Holub):

Petitioner testified that in July 2023, he received a statement showing his annual assessment increased from $525.00 (or $540.00) to $1,010.00 (or $1,495.00 in one statement). He argued this substantial increase was illegal. Regarding the violation, Holub admitted commencing construction of a courtyard and a 5.5-foot wall without prior HOA approval. He asserted he never received the initial Notice of Violation (NOV) via certified mail. He confirmed the certified mail NOV was returned as undeliverable. Holub also argued the subsequent fine letter (January 2023) was sent to a wrong, outdated address for his property-owning entity, Jolly Acres LLC.

Respondent's Argument (Marcus Martinez, Esq. and Mike Needham, Board President):

Respondent argued that there was no assessment increase. Board President Mike Needham testified that the high assessment amount was a clerical error made by the managing agent. This error was immediately corrected after Petitioner inquired, and a new ledger reflecting the correct $525.00 annual assessment was generated on July 7, 2023.

Concerning the fine, Respondent acknowledged the initial certified NOV (September 15, 2022) was returned undeliverable. However, the Board re-sent the NOV via e-mail on October 24, 2022, which Petitioner acknowledged receiving. The $500 fine was subsequently approved at the January 2023 board meeting for failure to seek approval for the construction. Respondent maintained that its procedures strictly adhered to Arizona law.

Final Decision and Legal Points

The ALJ issued a decision on February 12, 2024, denying the petition. The ALJ found that Petitioner failed to meet the burden of proof.

Assessment Ruling:

The ALJ concluded that the assessment issue was merely a clerical error that was promptly corrected. The evidence showed the annual assessment remained $525.00, meaning the Respondent did not violate ARS § 33-1803(A) by illegally increasing dues.

Fine Ruling:

The ALJ held that nothing in the relevant statute requires the association to send the Notice of Violation via certified mail. Although the mail was returned, Petitioner did receive the NOV via email on October 24, 2022. Since the fine was not imposed until the January 2023 board meeting (two and a half months later), Petitioner was given ample time to respond. Furthermore, the ALJ found Petitioner’s claim regarding failure to receive the fine letter to be "disingenuous," as Petitioner had failed to update a corrected address for the property-owning LLC with the Association after being notified of the requirement.

The Petitioner’s petition was denied in its entirety, and the HOA was not required to reimburse the filing fee.

Questions

Question

Is an HOA required to send a Notice of Violation via certified mail?

Short Answer

No, Arizona statute does not require the initial Notice of Violation to be sent via certified mail.

Detailed Answer

The ALJ determined that while homeowners often expect certified mail, the relevant statute (A.R.S. § 33-1803) does not mandate it for the initial notice. As long as the homeowner actually receives the notice (even via email) and it contains the required statutory information, it is considered valid.

Alj Quote

As to the fine, nothing in the statute requires the Association to send the notice via certified mail.

Legal Basis

A.R.S. § 33-1803

Topic Tags

  • violations
  • notices
  • procedural requirements

Question

Does a clerical error on a ledger count as an illegal assessment increase?

Short Answer

No, if the error is corrected and the homeowner is not actually forced to pay the incorrect amount, it is not a violation.

Detailed Answer

In this case, the HOA's management company sent a ledger showing an incorrect assessment amount that appeared to double the fees. However, because the HOA acknowledged the mistake, corrected the ledger to the proper amount, and communicated the correction to the homeowner, the ALJ ruled that the HOA did not violate the statute regarding assessment increases.

Alj Quote

The testimony provided, demonstrated that there was an error in the ledger Petitioner received initially, but that was corrected as evidenced by the July 7, 2023 ledger… Petitioner has not met its burden to prove that the Association violated the statute.

Legal Basis

A.R.S. § 33-1803(A)

Topic Tags

  • assessments
  • billing errors
  • fees

Question

Whose responsibility is it to ensure the HOA has the correct mailing address?

Short Answer

It is the homeowner's responsibility to update their address with the HOA.

Detailed Answer

The ALJ ruled that a homeowner cannot claim they didn't receive notice if they failed to provide the HOA with their current address. Even if the homeowner informs a board member verbally or via email of a change in ownership entity, they must explicitly provide the correct mailing address to the Association.

Alj Quote

While Petitioner informed Mr. Needham that Jolly Acres was now the owner and to mail all community documents to them, he did not provide an address nor update a corrected address with the Association. Thus, this was not the Association’s fault that he did not receive notice of the fine.

Legal Basis

N/A

Topic Tags

  • homeowner obligations
  • notices
  • mailing address

Question

Can an HOA send a Notice of Violation via email?

Short Answer

Yes, if the homeowner receives it.

Detailed Answer

The decision validated a Notice of Violation sent via email because the homeowner acknowledged receiving it. Since the homeowner received actual notice and the content of the email met statutory requirements, the notice was deemed valid despite not being mailed initially.

Alj Quote

Therefore, although Petitioner never received the Notice of Violation via mail, he did receive the same on October 24, 2022. From the evidence provided, the Notice complied with all of the statutory requirements

Legal Basis

A.R.S. § 33-1803

Topic Tags

  • violations
  • email
  • notices

Question

Who has the burden of proof in an administrative hearing against an HOA?

Short Answer

The homeowner (Petitioner) bears the burden of proof.

Detailed Answer

The homeowner filing the petition must prove that the HOA violated the law by a 'preponderance of the evidence,' which means showing that their claims are more likely true than not.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated ARIZ. REV. STAT. § 33-1803.

Legal Basis

A.R.S. § 41-1092

Topic Tags

  • hearings
  • legal standards
  • burden of proof

Question

Can a homeowner respond to a violation notice to contest it?

Short Answer

Yes, a homeowner has 21 days to respond via certified mail.

Detailed Answer

Statute allows a member to provide a written response to a violation notice. This response must be sent by certified mail within 21 calendar days of the notice date.

Alj Quote

A member who receives a written notice that the condition of the property owned by the member is in violation of the community documents… may provide the association with a written response by sending the response by certified mail within twenty-one calendar days after the date of the notice.

Legal Basis

A.R.S. § 33-1803(C)

Topic Tags

  • violations
  • due process
  • homeowner rights

Question

If a homeowner makes a partial payment on a debt, how must the HOA apply the money?

Short Answer

Payments must be applied to the principal debt first, then to accrued interest.

Detailed Answer

Arizona law mandates that any monies paid by a member for an unpaid penalty or assessment must be applied first to the principal amount unpaid and then to the interest accrued.

Alj Quote

Any monies paid by a member for an unpaid penalty shall be applied first to the principal amount unpaid and then to the interest accrued.

Legal Basis

A.R.S. § 33-1803(B)

Topic Tags

  • payments
  • accounting
  • penalties

Question

Will the filing fee for the hearing be refunded if the homeowner loses?

Short Answer

No, the filing fee is not reimbursed if the petition is denied.

Detailed Answer

The ALJ ordered that because the petition was denied, the Respondent (HOA) was not required to reimburse the Petitioner's filing fee.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee as required by ARIZ. REV. STAT. § 32-2199.01.

Legal Basis

A.R.S. § 32-2199.02(A)

Topic Tags

  • hearings
  • fees
  • costs

Case

Docket No
24F-H021-REL
Case Title
George Holub v 3 Canyons Ranch Master Homeowners’ Association
Decision Date
2024-02-12
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Questions

Question

Is an HOA required to send a Notice of Violation via certified mail?

Short Answer

No, Arizona statute does not require the initial Notice of Violation to be sent via certified mail.

Detailed Answer

The ALJ determined that while homeowners often expect certified mail, the relevant statute (A.R.S. § 33-1803) does not mandate it for the initial notice. As long as the homeowner actually receives the notice (even via email) and it contains the required statutory information, it is considered valid.

Alj Quote

As to the fine, nothing in the statute requires the Association to send the notice via certified mail.

Legal Basis

A.R.S. § 33-1803

Topic Tags

  • violations
  • notices
  • procedural requirements

Question

Does a clerical error on a ledger count as an illegal assessment increase?

Short Answer

No, if the error is corrected and the homeowner is not actually forced to pay the incorrect amount, it is not a violation.

Detailed Answer

In this case, the HOA's management company sent a ledger showing an incorrect assessment amount that appeared to double the fees. However, because the HOA acknowledged the mistake, corrected the ledger to the proper amount, and communicated the correction to the homeowner, the ALJ ruled that the HOA did not violate the statute regarding assessment increases.

Alj Quote

The testimony provided, demonstrated that there was an error in the ledger Petitioner received initially, but that was corrected as evidenced by the July 7, 2023 ledger… Petitioner has not met its burden to prove that the Association violated the statute.

Legal Basis

A.R.S. § 33-1803(A)

Topic Tags

  • assessments
  • billing errors
  • fees

Question

Whose responsibility is it to ensure the HOA has the correct mailing address?

Short Answer

It is the homeowner's responsibility to update their address with the HOA.

Detailed Answer

The ALJ ruled that a homeowner cannot claim they didn't receive notice if they failed to provide the HOA with their current address. Even if the homeowner informs a board member verbally or via email of a change in ownership entity, they must explicitly provide the correct mailing address to the Association.

Alj Quote

While Petitioner informed Mr. Needham that Jolly Acres was now the owner and to mail all community documents to them, he did not provide an address nor update a corrected address with the Association. Thus, this was not the Association’s fault that he did not receive notice of the fine.

Legal Basis

N/A

Topic Tags

  • homeowner obligations
  • notices
  • mailing address

Question

Can an HOA send a Notice of Violation via email?

Short Answer

Yes, if the homeowner receives it.

Detailed Answer

The decision validated a Notice of Violation sent via email because the homeowner acknowledged receiving it. Since the homeowner received actual notice and the content of the email met statutory requirements, the notice was deemed valid despite not being mailed initially.

Alj Quote

Therefore, although Petitioner never received the Notice of Violation via mail, he did receive the same on October 24, 2022. From the evidence provided, the Notice complied with all of the statutory requirements

Legal Basis

A.R.S. § 33-1803

Topic Tags

  • violations
  • email
  • notices

Question

Who has the burden of proof in an administrative hearing against an HOA?

Short Answer

The homeowner (Petitioner) bears the burden of proof.

Detailed Answer

The homeowner filing the petition must prove that the HOA violated the law by a 'preponderance of the evidence,' which means showing that their claims are more likely true than not.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated ARIZ. REV. STAT. § 33-1803.

Legal Basis

A.R.S. § 41-1092

Topic Tags

  • hearings
  • legal standards
  • burden of proof

Question

Can a homeowner respond to a violation notice to contest it?

Short Answer

Yes, a homeowner has 21 days to respond via certified mail.

Detailed Answer

Statute allows a member to provide a written response to a violation notice. This response must be sent by certified mail within 21 calendar days of the notice date.

Alj Quote

A member who receives a written notice that the condition of the property owned by the member is in violation of the community documents… may provide the association with a written response by sending the response by certified mail within twenty-one calendar days after the date of the notice.

Legal Basis

A.R.S. § 33-1803(C)

Topic Tags

  • violations
  • due process
  • homeowner rights

Question

If a homeowner makes a partial payment on a debt, how must the HOA apply the money?

Short Answer

Payments must be applied to the principal debt first, then to accrued interest.

Detailed Answer

Arizona law mandates that any monies paid by a member for an unpaid penalty or assessment must be applied first to the principal amount unpaid and then to the interest accrued.

Alj Quote

Any monies paid by a member for an unpaid penalty shall be applied first to the principal amount unpaid and then to the interest accrued.

Legal Basis

A.R.S. § 33-1803(B)

Topic Tags

  • payments
  • accounting
  • penalties

Question

Will the filing fee for the hearing be refunded if the homeowner loses?

Short Answer

No, the filing fee is not reimbursed if the petition is denied.

Detailed Answer

The ALJ ordered that because the petition was denied, the Respondent (HOA) was not required to reimburse the Petitioner's filing fee.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee as required by ARIZ. REV. STAT. § 32-2199.01.

Legal Basis

A.R.S. § 32-2199.02(A)

Topic Tags

  • hearings
  • fees
  • costs

Case

Docket No
24F-H021-REL
Case Title
George Holub v 3 Canyons Ranch Master Homeowners’ Association
Decision Date
2024-02-12
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • George Holub (petitioner)
    Jolly Acres LLC (Owner Entity)
    Appeared on his own behalf
  • Emily Holub (Petitioner's Wife)
    Involved in communications with the HOA regarding assessment

Respondent Side

  • Marcus Martinez (HOA attorney)
    3 Canyons Ranch Master Homeowners’ Association
    Represented Respondent
  • Mike Needham (Board President)
    3 Canyons Ranch Master Homeowners’ Association
    President of the Board of Directors, testified as a witness
  • Nicholas Nogami (Attorney)
    Carpenter Hazlewood
    Listed in service transmission
  • Sarah Malovich (HOA Agent)
  • David Roberts (HOA Agent)
    Provided statement
  • Mrs. Turka (HOA contact)
    Gate person contact
  • Mr. Plat (MDC Chairman)
    3 Canyons Ranch Master Homeowners’ Association
    Chairman of the Master Design Committee
  • Donna (HOA Agent)
    Platinum Management
    HOA/Accounting contact
  • Stacy Smith (board member)
    3 Canyons Ranch Master Homeowners’ Association
    Board member who made a motion regarding the fine

Neutral Parties

  • Adam D. Stone (ALJ)
    OAH
  • Susan Nicolson (Commissioner)
    ADRE
  • AHansen (ADRE Staff)
    ADRE
    Listed in service transmission email list
  • vnunez (ADRE Staff)
    ADRE
    Listed in service transmission email list
  • djones (ADRE Staff)
    ADRE
    Listed in service transmission email list
  • labril (ADRE Staff)
    ADRE
    Listed in service transmission email list

Other Participants

  • Dimitry Wilker (Neighbor)

Teri S. Morcomb & J. Ted Morcomb v. Sierra Tortuga Homeowner’s

Posted on by

Case Summary

Case ID 24F-H015-REL
Agency ADRE
Tribunal OAH
Decision Date 2024-01-03
Administrative Law Judge Adam D. Stone
Outcome Petitioner met the burden of proof for both alleged violations: violation of the Declaration (not enforcing the 25ft setback) and violation of A.R.S. § 33-1805 (failing to provide documents). The petition was granted, and Respondent was ordered to reimburse the $1,000.00 filing fee.
Filing Fees Refunded $1,000.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Teri S. Morcomb & J. Ted Morcomb Counsel Jeffrey Brie, Esq.
Respondent Sierra Tortuga Homeowner’s Association Counsel Phillip Brown, Esq. and Kelly Oetinger, Esq.

Alleged Violations

ARIZ. REV. STAT. § 33-1805

Outcome Summary

Petitioner met the burden of proof for both alleged violations: violation of the Declaration (not enforcing the 25ft setback) and violation of A.R.S. § 33-1805 (failing to provide documents). The petition was granted, and Respondent was ordered to reimburse the $1,000.00 filing fee.

Key Issues & Findings

Failure to provide documents

Respondent failed to produce documents requested by Petitioner, specifically meeting minutes discussing the investigative report, within the statutory timeframe, violating A.R.S. § 33-1805.

Orders: Respondent was found in violation of A.R.S. § 33-1805 and Declaration Section F. Respondent shall reimburse Petitioner’s filing fee of $1,000.00.

Filing fee: $1,000.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

  • ARIZ. REV. STAT. § 33-1805
  • Declaration Section F

Analytics Highlights

Topics: setback enforcement, document request, HOA governance, filing fee refund, A.R.S. 33-1805
Additional Citations:

  • ARIZ. REV. STAT. § 32-2102
  • ARIZ. REV. STAT. § 32-2199 et al.
  • ARIZ. REV. STAT. § 32-2199.05
  • ARIZ. REV. STAT. § 32-2199(2)
  • ARIZ. REV. STAT. § 32-2199.01(D)
  • ARIZ. REV. STAT. § 32-2199.02
  • ARIZ. REV. STAT. § 33-1805
  • ARIZ. ADMIN. CODE R2-19-119
  • ARIZ. REV. STAT. § 41-1092
  • ARIZ. REV. STAT. § 41-1092.09
  • ARIZ. REV. STAT. § 32-2199.02(A)
  • ARIZ. REV. STAT. § 32-2199.04
  • ARIZ. REV. STAT. § 33-1804
  • Declaration Section F

Video Overview

Audio Overview

Decision Documents

24F-H015-REL Decision – 1102948.pdf

Uploaded 2026-01-23T18:02:19 (53.9 KB)

24F-H015-REL Decision – 1116083.pdf

Uploaded 2026-01-23T18:02:23 (50.5 KB)

24F-H015-REL Decision – 1129495.pdf

Uploaded 2026-01-23T18:02:26 (148.2 KB)

This summary addresses the administrative hearing (No. 24F-H015-REL) involving Petitioners Teri S. Morcomb & J. Ted Morcomb and Respondent Sierra Tortuga Homeowner’s Association (HOA). The hearing was conducted by Administrative Law Judge (ALJ) Adam D. Stone on November 22 and December 20, 2023, concerning alleged violations of the community's governing documents and Arizona statutes.

Key Facts and Main Issues

The Petitioners filed a two-issue petition with the Arizona Department of Real Estate:

  1. Setback Enforcement: Violation of the Declaration of Restrictions (specifically Item F of the Second Declaration) by the HOA "not enforcing the 25ft setback provision".
  2. Document Disclosure: Violation of A.R.S. § 33-1805 by failing "to provide documents" requested by the Petitioners.

The central factual dispute revolved around Lot 9 (owned by Marcella Aguilar and Abel Sodto), which shares a property line with the Petitioners' Lot 8. Petitioners alleged that the Lot 9 owners made unapproved improvements—including grading, removal of native vegetation, and placement of large boulders—within the mandatory 25-foot setback. The Declaration requires Architectural Committee (ARC) approval for all improvements and any removal of native growth. An HOA investigation in September 2020 concluded that the Lot 9 improvements were neither submitted nor approved by the ARC, and Lot 9 was directed to submit plans within 30 days. Petitioners testified that Lot 9 failed to comply.

Key Arguments

  • Petitioner's Argument: The Association failed its mandatory duty to enforce the CC&Rs for over three years, particularly since the Lot 9 owner (Mr. Sodto) held influential positions (Director, President, ARC member) during the relevant period. Petitioners sought an order requiring the HOA to remedy the violation (remove boulders, revegetate). Petitioners' civil engineer, Tracy Bogardus, testified that Lot 8 did not cause Lot 9's drainage issues, invalidating the Lot 9 owners’ justification for the grading.
  • Respondent's Argument (HOA): The HOA denied the claims, arguing that Lot 9’s modification (referred to as a "driveway turnaround") was necessary for safety due to the steep lot configuration. The HOA asserted that the board has discretion to grant variances. The HOA also argued that selective enforcement against Lot 9 was inconsistent, as six of the seven built-out lots had similar unapproved turnarounds or improvements in setbacks. The HOA later approved the Lot 9 turnaround retroactively during the hearing proceedings.
  • Document Disclosure: HOA President Robert Lewin testified he did not provide the specific documents (Lot 9 submissions) because they did not exist. However, he admitted he failed to provide the meeting minutes discussing the investigative report.

Final Decision and Outcome

The ALJ found that the Petitioners met the burden of proof by a preponderance of the evidence.

The ALJ issued the following key conclusions:

  • Setback Violation: Lot 9 failed to submit the required improvement request, violating the Declaration. However, the ALJ emphasized that the relevant section of the Declaration (Section H) states the ARC "shall have the right to clear such lot," meaning the ultimate action to remedy the lot remains within the HOA’s discretion, not an obligation.
  • Document Disclosure Violation (A.R.S. § 33-1805): The Respondent violated the statute by failing to produce a copy of the meeting minutes discussing the investigative report. Although no Lot 9 application documents existed, the minutes did.

Order: Petitioner's petition was granted. Pursuant to A.R.S. § 32-2199.02(A), the Respondent HOA was ordered to reimburse Petitioner’s filing fee of $1,000.00.

{ “case”: { “docket_no”: “24F-H015-REL”, “case_title”: “Teri S. Morcomb & J. Ted Morcomb v. Sierra Tortuga Homeowner’s Association”, “decision_date”: “2024-01-03”, “alj_name”: “Adam D. Stone”, “tribunal”: “OAH”, “agency”: “ADRE” }, “questions”: [ { “question”: “If I win my case against the HOA, can I get my filing fee reimbursed?”, “short_answer”: “Yes, the ALJ can order the HOA to reimburse the filing fee if the petition is granted.”, “detailed_answer”: “Under Arizona law, if a homeowner prevails in their petition against the association, the Administrative Law Judge has the authority to order the respondent (HOA) to reimburse the petitioner’s filing fee.”, “alj_quote”: “IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall reimburse Petitioner’s filing fee of $1,000.00 as required by ARIZ. REV. STAT. § 32-2199.01.”, “legal_basis”: “A.R.S. § 32-2199.02(A)”, “topic_tags”: [ “filing fees”, “reimbursement”, “penalties” ] }, { “question”: “What is the timeline for an HOA to provide records after a homeowner requests them?”, “short_answer”: “The HOA has ten business days to fulfill a request for examination or provide copies of records.”, “detailed_answer”: “Arizona statute requires that an association make financial and other records reasonably available for examination. When a member requests to examine or purchase copies of records, the association must comply within ten business days.”, “alj_quote”: “The association shall have ten business days to fulfill a request for examination. … On request for purchase of copies of records … the association shall have ten business days to provide copies of the requested records.”, “legal_basis”: “A.R.S. § 33-1805(A)”, “topic_tags”: [ “records request”, “deadlines”, “homeowner rights” ] }, { “question”: “Can an HOA refuse to provide meeting minutes by claiming other documents regarding a specific issue don’t exist?”, “short_answer”: “No, even if specific architectural files don’t exist, the HOA must still provide related meeting minutes if requested.”, “detailed_answer”: “In this case, while the HOA claimed no documents existed regarding a specific architectural submission (because none was made), they were still found in violation for failing to produce the meeting minutes where the issue and an investigative report were discussed.”, “alj_quote”: “From the evidence presented, and Mr. Lewin admitted, that Respondent failed to produce a copy of the meeting minutes discussing the investigative report.”, “legal_basis”: “A.R.S. § 33-1805”, “topic_tags”: [ “meeting minutes”, “records access”, “HOA obligations” ] }, { “question”: “Does the ALJ have the authority to order the HOA to physically clear a violation from a neighbor’s lot?”, “short_answer”: “Not necessarily, if the CC&Rs grant the HOA the ‘right’ rather than the ‘duty’ to clear the lot, it remains a discretionary action.”, “detailed_answer”: “Although the ALJ found the HOA in violation of the CC&Rs for the setback issue, the judge disagreed that the HOA must clear the lot. The specific language of the governing documents gave the Architectural Committee the ‘right’ to clear the lot, which the judge interpreted as discretionary.”, “alj_quote”: “However, the tribunal disagrees with Petitioner that Respondent must clear the lot. Section H of the Declaration merely states that the Architectural Committee ‘shall have the right to clear such lot’. Thus, it is still within the Architectural Committee’s discretion to act on that right.”, “legal_basis”: “CC&Rs Interpretation”, “topic_tags”: [ “enforcement”, “remedies”, “CC&Rs” ] }, { “question”: “What is the burden of proof in an HOA administrative hearing?”, “short_answer”: “The petitioner must prove their case by a ‘preponderance of the evidence’.”, “detailed_answer”: “The homeowner bringing the complaint bears the burden of proving that the HOA violated the community documents or statutes. The standard is a ‘preponderance of the evidence,’ meaning the contention is more probably true than not.”, “alj_quote”: “In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated the item F of the Declarations and ARIZ. REV. STAT. § 33-1805.”, “legal_basis”: “A.A.C. R2-19-119”, “topic_tags”: [ “burden of proof”, “legal standards”, “procedure” ] }, { “question”: “Can the HOA be found in violation for a neighbor’s unapproved improvements?”, “short_answer”: “Yes, if the HOA fails to enforce setback requirements against unapproved improvements.”, “detailed_answer”: “The ALJ found the Board in violation of the Declaration (setback rules) because the neighbor never submitted a request for the improvements, the improvements did not comply with setbacks, and the Board failed to enforce the requirement.”, “alj_quote”: “Petitioner has met the burden of proof in demonstrating that the Board was in violation of Section F of the Declaration and ARIZ. REV. STAT. § 33-1805.”, “legal_basis”: “CC&Rs (Section F)”, “topic_tags”: [ “architectural control”, “setbacks”, “violations” ] }, { “question”: “Do HOA directors have the right to inspect association records?”, “short_answer”: “Yes, directors generally have an absolute right to inspect all books and records at any reasonable time.”, “detailed_answer”: “The decision cites the Association Bylaws which grant every Director the absolute right to inspect all books, records, documents, and physical properties of the Association.”, “alj_quote”: “Every Director shall have the absolute right at any reasonable time to inspect all books, records, and documents of the Association and the physical properties owned or controlled by the Association.”, “legal_basis”: “Association Bylaws Article 11.3”, “topic_tags”: [ “board members”, “records inspection”, “bylaws” ] } ] }

{ “case”: { “docket_no”: “24F-H015-REL”, “case_title”: “Teri S. Morcomb & J. Ted Morcomb v. Sierra Tortuga Homeowner’s Association”, “decision_date”: “2024-01-03”, “alj_name”: “Adam D. Stone”, “tribunal”: “OAH”, “agency”: “ADRE” }, “questions”: [ { “question”: “If I win my case against the HOA, can I get my filing fee reimbursed?”, “short_answer”: “Yes, the ALJ can order the HOA to reimburse the filing fee if the petition is granted.”, “detailed_answer”: “Under Arizona law, if a homeowner prevails in their petition against the association, the Administrative Law Judge has the authority to order the respondent (HOA) to reimburse the petitioner’s filing fee.”, “alj_quote”: “IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall reimburse Petitioner’s filing fee of $1,000.00 as required by ARIZ. REV. STAT. § 32-2199.01.”, “legal_basis”: “A.R.S. § 32-2199.02(A)”, “topic_tags”: [ “filing fees”, “reimbursement”, “penalties” ] }, { “question”: “What is the timeline for an HOA to provide records after a homeowner requests them?”, “short_answer”: “The HOA has ten business days to fulfill a request for examination or provide copies of records.”, “detailed_answer”: “Arizona statute requires that an association make financial and other records reasonably available for examination. When a member requests to examine or purchase copies of records, the association must comply within ten business days.”, “alj_quote”: “The association shall have ten business days to fulfill a request for examination. … On request for purchase of copies of records … the association shall have ten business days to provide copies of the requested records.”, “legal_basis”: “A.R.S. § 33-1805(A)”, “topic_tags”: [ “records request”, “deadlines”, “homeowner rights” ] }, { “question”: “Can an HOA refuse to provide meeting minutes by claiming other documents regarding a specific issue don’t exist?”, “short_answer”: “No, even if specific architectural files don’t exist, the HOA must still provide related meeting minutes if requested.”, “detailed_answer”: “In this case, while the HOA claimed no documents existed regarding a specific architectural submission (because none was made), they were still found in violation for failing to produce the meeting minutes where the issue and an investigative report were discussed.”, “alj_quote”: “From the evidence presented, and Mr. Lewin admitted, that Respondent failed to produce a copy of the meeting minutes discussing the investigative report.”, “legal_basis”: “A.R.S. § 33-1805”, “topic_tags”: [ “meeting minutes”, “records access”, “HOA obligations” ] }, { “question”: “Does the ALJ have the authority to order the HOA to physically clear a violation from a neighbor’s lot?”, “short_answer”: “Not necessarily, if the CC&Rs grant the HOA the ‘right’ rather than the ‘duty’ to clear the lot, it remains a discretionary action.”, “detailed_answer”: “Although the ALJ found the HOA in violation of the CC&Rs for the setback issue, the judge disagreed that the HOA must clear the lot. The specific language of the governing documents gave the Architectural Committee the ‘right’ to clear the lot, which the judge interpreted as discretionary.”, “alj_quote”: “However, the tribunal disagrees with Petitioner that Respondent must clear the lot. Section H of the Declaration merely states that the Architectural Committee ‘shall have the right to clear such lot’. Thus, it is still within the Architectural Committee’s discretion to act on that right.”, “legal_basis”: “CC&Rs Interpretation”, “topic_tags”: [ “enforcement”, “remedies”, “CC&Rs” ] }, { “question”: “What is the burden of proof in an HOA administrative hearing?”, “short_answer”: “The petitioner must prove their case by a ‘preponderance of the evidence’.”, “detailed_answer”: “The homeowner bringing the complaint bears the burden of proving that the HOA violated the community documents or statutes. The standard is a ‘preponderance of the evidence,’ meaning the contention is more probably true than not.”, “alj_quote”: “In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated the item F of the Declarations and ARIZ. REV. STAT. § 33-1805.”, “legal_basis”: “A.A.C. R2-19-119”, “topic_tags”: [ “burden of proof”, “legal standards”, “procedure” ] }, { “question”: “Can the HOA be found in violation for a neighbor’s unapproved improvements?”, “short_answer”: “Yes, if the HOA fails to enforce setback requirements against unapproved improvements.”, “detailed_answer”: “The ALJ found the Board in violation of the Declaration (setback rules) because the neighbor never submitted a request for the improvements, the improvements did not comply with setbacks, and the Board failed to enforce the requirement.”, “alj_quote”: “Petitioner has met the burden of proof in demonstrating that the Board was in violation of Section F of the Declaration and ARIZ. REV. STAT. § 33-1805.”, “legal_basis”: “CC&Rs (Section F)”, “topic_tags”: [ “architectural control”, “setbacks”, “violations” ] }, { “question”: “Do HOA directors have the right to inspect association records?”, “short_answer”: “Yes, directors generally have an absolute right to inspect all books and records at any reasonable time.”, “detailed_answer”: “The decision cites the Association Bylaws which grant every Director the absolute right to inspect all books, records, documents, and physical properties of the Association.”, “alj_quote”: “Every Director shall have the absolute right at any reasonable time to inspect all books, records, and documents of the Association and the physical properties owned or controlled by the Association.”, “legal_basis”: “Association Bylaws Article 11.3”, “topic_tags”: [ “board members”, “records inspection”, “bylaws” ] } ] }

Case Participants

Petitioner Side

  • Teri S. Morcomb (petitioner)
    Lot 8 owner, testified
  • J. Ted Morcomb (petitioner)
    Lot 8 owner
  • Jeffrey T. Brei (petitioner attorney)
  • Tracy Allen Bogardis (witness)
    Civil Engineer
    Testified regarding drainage/hydrology

Respondent Side

  • Phillip Brown (HOA attorney)
  • Kelly Oetinger (HOA attorney)
  • Robert Leuen (board president)
    Sierra Tortuga HOA
    Testified
  • Marcella Bernadette Aguilar (witness)
    Sierra Tortuga HOA
    Lot 9 owner, testified
  • Abel Sodto (lot owner)
    Sierra Tortuga HOA
    Lot 9 owner, former Board/ARC member, subject of violation
  • Clint Stoddard (board member)
    Sierra Tortuga HOA
    Investigator
  • Benny Medina (board member)
    Sierra Tortuga HOA
    Investigator, former president
  • Joseph D. Martino (ARC member)
    Sierra Tortuga HOA
    Former Architectural Committee Head
  • Chris Stler (board member)
    Sierra Tortuga HOA
    Vice President of HOA
  • Yvon Posche (board member)
    Sierra Tortuga HOA
    Secretary of HOA
  • Steve Brockam (board member)
    Sierra Tortuga HOA
    Board Director
  • Perry Terren (ARC chair)
    Sierra Tortuga HOA
    ARC Chairman and Board Director
  • Jeremy Thompson (law clerk)
    HOA Attorney's office
  • Mike Shupe (former HOA attorney)

Neutral Parties

  • Adam D. Stone (ALJ)
    OAH
  • Tim Ross (board member)
    Sierra Tortuga HOA
    Former board/investigator, criticized current board actions
  • Susan Nicolson (Commissioner)
    ADRE
  • A. Hansen (ADRE staff)
    ADRE
  • V. Nunez (ADRE staff)
    ADRE
  • D. Jones (ADRE staff)
    ADRE
  • L. Abril (ADRE staff)
    ADRE

Sebastien Verstraet v. Monterey Ridge Condominium Association

Posted on by

Case Summary

Case ID 23F-H066-REL
Agency ADRE
Tribunal OAH
Decision Date 2023-11-13
Administrative Law Judge Adam D. Stone
Outcome The Administrative Law Judge denied the petition, concluding that the homeowner failed to meet the burden of proof to show the HOA violated its documents. The Declaration and Rules unambiguously prohibited hard floor coverings (including vinyl) in the Petitioner's third-floor unit, and the Petitioner admitted installing the flooring without seeking approval.
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Sebastien Verstraet Counsel —
Respondent Monterey Ridge Condominium Association Counsel Marcus R. Martinez

Alleged Violations

Section 4.24, Declaration/Rules

Outcome Summary

The Administrative Law Judge denied the petition, concluding that the homeowner failed to meet the burden of proof to show the HOA violated its documents. The Declaration and Rules unambiguously prohibited hard floor coverings (including vinyl) in the Petitioner's third-floor unit, and the Petitioner admitted installing the flooring without seeking approval.

Why this result: Petitioner failed to meet the burden of proof. Petitioner received the governing documents prior to closing, failed to fully read them, and failed to seek permission from the Association prior to installing the prohibited Luxury Vinyl Plank flooring.

Key Issues & Findings

Flooring Restriction for New Units

Petitioner challenged the Association's enforcement of a declaration rule prohibiting hard floor coverings (like LVP) in his third-floor unit, arguing his chosen flooring had sufficient soundproofing. The Association argued the rule was clear, unambiguous, and mandatory for enforcement.

Orders: Petitioner's petition is denied. Respondent shall not reimburse Petitioner's filing fee.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • ARIZ. REV. STAT. §§ 32-2102
  • ARIZ. REV. STAT. §§ 32-2199 et al.
  • ARIZ. REV. STAT. § 32-2199.05
  • ARIZ. REV. STAT. §§ 32-2199(2)
  • ARIZ. REV. STAT. §§ 32-2199.01(D)
  • ARIZ. REV. STAT. §§ 32-2199.02
  • ARIZ. REV. STAT. §§ 41-1092
  • ARIZ. ADMIN. CODE R2-19-119

Analytics Highlights

Topics: Flooring Restriction, Luxury Vinyl Plank (LVP), CCNR Enforcement, Third Floor Unit, Prior Approval
Additional Citations:

  • ARIZ. REV. STAT. §§ 32-2102
  • ARIZ. REV. STAT. §§ 32-2199 et al.
  • ARIZ. REV. STAT. § 32-2199.05
  • ARIZ. REV. STAT. §§ 32-2199(2)
  • ARIZ. REV. STAT. §§ 32-2199.01(D)
  • ARIZ. REV. STAT. §§ 32-2199.02
  • ARIZ. REV. STAT. §§ 41-1092
  • ARIZ. ADMIN. CODE R2-19-119

Video Overview

Audio Overview

Decision Documents

23F-H066-REL Decision – 1085177.pdf

Uploaded 2026-04-24T12:13:28 (48.3 KB)

23F-H066-REL Decision – 1112087.pdf

Uploaded 2026-04-24T12:13:33 (110.4 KB)

23F-H066-REL Decision – 1085177.pdf

Uploaded 2026-01-23T18:00:06 (48.3 KB)

23F-H066-REL Decision – 1112087.pdf

Uploaded 2026-01-23T18:00:14 (110.4 KB)

This summary details the proceedings, arguments, and final decision in the case of Sebastien Verstraet v. Monterey Ridge Condominium Association (No. 23F-H066-REL), heard by Administrative Law Judge (ALJ) Adam D. Stone.

Key Facts and Main Issue

The core dispute was whether the Monterey Ridge Condominium Association (Respondent) violated its governing documents by enforcing a prohibition against the Petitioner, Sebastien Verstraet, who installed Luxury Vinyl Plank (LVP) flooring in his third-floor unit. The Petitioner filed the action after the Association, upon discovery of the unauthorized installation, issued a violation notice and required removal of the LVP.

The restriction at issue was Section 4.24 of the Declaration, titled "Flooring Restriction for New Units," which prohibited hard floor coverings (listing materials such as ceramic tile, natural stone, vinyl, hardwood, or laminated flooring) in all third-floor units, requiring carpet and pad instead to mitigate noise disturbance.

Hearing Proceedings and Key Arguments

The evidentiary hearing took place on October 26, 2023.

Petitioner's Position: Mr. Verstraet argued that he was unaware of the prohibition before installation, having only briefly reviewed the community documents received shortly before closing. He contended that LVP is the preferred modern flooring, significantly improves resale value, and provides soundproofing (IIC rating of 63) equal to or better than standard carpeting, rendering the rule obsolete or illogically drafted. He also noted that LVP was already permitted and installed in the kitchen, bathrooms, and laundry room of the unit. Furthermore, he did not seek prior written approval because he was unaware of the restriction.

Respondent's Position: The Association, represented by counsel, asserted its right and obligation to enforce its governing documents as written. Counsel argued that the recorded covenants were binding upon the Petitioner when he took the deed. The rule explicitly prohibits vinyl flooring in all third-floor units to address noise mitigation, a factor contemplated by the developer or subsequent amendment. The Community Manager, Robert Stein, testified that the Association followed typical enforcement procedures, and a neighbor below had complained about rolling noises emanating from the unit. The Association requested dismissal, arguing it had not violated its CC&Rs or Arizona law.

Legal Outcome and Final Decision

The ALJ issued the decision on November 13, 2023.

The ALJ concluded that the Petitioner failed to meet his burden of proving by a preponderance of the evidence that the Association violated its documents or Arizona law. The decision emphasized the following legal points:

  1. Binding Nature of Documents: Although the Petitioner's points regarding LVP's aesthetic appeal and value were "valid," the Declarations and Rules are clear and unambiguous regarding the prohibition of hard floor coverings (including vinyl) in third-floor units.
  2. Failure to Seek Approval: The Petitioner admitted receiving the Declaration prior to closing, not fully reading it, and failing to seek permission to install the flooring. Had he sought approval, he likely would have been informed of the prohibition.

The ALJ ORDERED that Petitioner’s petition be DENIED. Consequently, the Association was not required to reimburse the Petitioner’s filing fee.

Questions

Question

Can I install hard flooring like vinyl or hardwood in my upper-floor condo unit?

Short Answer

Not if the CC&Rs specifically prohibit it to mitigate noise, even if the product is high quality.

Detailed Answer

If the governing documents explicitly prohibit hard floor coverings in specific units (such as second or third-floor units) to mitigate noise, the HOA can enforce this restriction regardless of the quality or sound rating of the material installed.

Alj Quote

Except for entry areas where hard floor coverings have been installed by Declarant, and except for kitchen, bathroom and laundry areas, hard floor coverings (e.g., ceramic tile, natural stone, vinyl, hardwood or laminated flooring) shall be prohibited in all other areas… and all third floor Units.

Legal Basis

CC&Rs Section 4.24

Topic Tags

  • architectural restrictions
  • flooring
  • noise mitigation

Question

Is it a valid defense that I didn't read the CC&Rs before making a change?

Short Answer

No. If you received the documents, you are responsible for knowing the rules.

Detailed Answer

Admitting that you received the Declaration and Rules but did not read them is not a valid defense against a violation. The tribunal will likely find against a homeowner who had the opportunity to review the restrictions but failed to do so.

Alj Quote

Petitioner admitted in his testimony that he timely received a copy of the Declaration and Rules approximately a week prior to closing. Petitioner also admitted that he did not fully read the same… The tribunal finds that Petitioner has not met his burden.

Legal Basis

Contractual Obligation / Constructive Notice

Topic Tags

  • homeowner responsibilities
  • CC&Rs
  • ignorance of law

Question

Does my HOA have to approve a renovation if the new material is 'better' or more valuable than what is required?

Short Answer

No. Clear rules in the CC&Rs override arguments about aesthetics or resale value.

Detailed Answer

Even if a homeowner presents valid points about the superior look or potential resale value of a prohibited improvement (like LVP flooring vs. carpet), the ALJ will enforce the clear and unambiguous language of the governing documents.

Alj Quote

While Petitioner probably had valid points about the look and potential value of LVP flooring versus carpeting, unfortunately, the Declarations and Rules are clear and unambiguous…

Legal Basis

Enforcement of Governing Documents

Topic Tags

  • architectural control
  • property value
  • renovations

Question

What happens if I start a renovation without asking for HOA permission first?

Short Answer

You risk violating rules you weren't aware of and may be forced to stop or reverse the work.

Detailed Answer

Skipping the approval process is risky. If a homeowner fails to seek permission, they miss the opportunity to be informed of specific prohibitions before spending money on installation.

Alj Quote

Petitioner admitted that he did not seek permission from the Association to install the LVP flooring, which had he done, he probably would have been informed that the Rules did not allow for the same.

Legal Basis

Architectural Review Process

Topic Tags

  • procedural requirements
  • renovations
  • violations

Question

Who has to prove their case in an HOA dispute hearing?

Short Answer

The Petitioner (the homeowner filing the complaint) bears the burden of proof.

Detailed Answer

In an administrative hearing, the homeowner filing the petition must prove by a 'preponderance of the evidence' that the HOA violated the governing documents or laws.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated the Declarations and Association Rules.

Legal Basis

Burden of Proof (ARIZ. ADMIN. CODE R2-19-119)

Topic Tags

  • legal procedure
  • burden of proof
  • hearings

Question

What does 'preponderance of the evidence' mean?

Short Answer

It means the evidence shows the claim is more likely true than not.

Detailed Answer

The standard involves superior evidentiary weight that is sufficient to incline a fair and impartial mind to one side of the issue rather than the other.

Alj Quote

A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.

Legal Basis

Legal Standard of Evidence

Topic Tags

  • legal definitions
  • evidence

Question

If I lose my case against the HOA, will I get my filing fee back?

Short Answer

No. Reimbursement is generally denied if the petition is denied.

Detailed Answer

If the ALJ rules against the homeowner and denies the petition, the order will typically state that the Respondent (HOA) is not required to reimburse the filing fee.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee…

Legal Basis

ARIZ. REV. STAT. § 32-2199.02(A)

Topic Tags

  • costs
  • penalties
  • fees

Case

Docket No
23F-H066-REL
Case Title
Sebastien Verstraet v. Monterey Ridge Condominium Association
Decision Date
2023-11-13
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Questions

Question

Can I install hard flooring like vinyl or hardwood in my upper-floor condo unit?

Short Answer

Not if the CC&Rs specifically prohibit it to mitigate noise, even if the product is high quality.

Detailed Answer

If the governing documents explicitly prohibit hard floor coverings in specific units (such as second or third-floor units) to mitigate noise, the HOA can enforce this restriction regardless of the quality or sound rating of the material installed.

Alj Quote

Except for entry areas where hard floor coverings have been installed by Declarant, and except for kitchen, bathroom and laundry areas, hard floor coverings (e.g., ceramic tile, natural stone, vinyl, hardwood or laminated flooring) shall be prohibited in all other areas… and all third floor Units.

Legal Basis

CC&Rs Section 4.24

Topic Tags

  • architectural restrictions
  • flooring
  • noise mitigation

Question

Is it a valid defense that I didn't read the CC&Rs before making a change?

Short Answer

No. If you received the documents, you are responsible for knowing the rules.

Detailed Answer

Admitting that you received the Declaration and Rules but did not read them is not a valid defense against a violation. The tribunal will likely find against a homeowner who had the opportunity to review the restrictions but failed to do so.

Alj Quote

Petitioner admitted in his testimony that he timely received a copy of the Declaration and Rules approximately a week prior to closing. Petitioner also admitted that he did not fully read the same… The tribunal finds that Petitioner has not met his burden.

Legal Basis

Contractual Obligation / Constructive Notice

Topic Tags

  • homeowner responsibilities
  • CC&Rs
  • ignorance of law

Question

Does my HOA have to approve a renovation if the new material is 'better' or more valuable than what is required?

Short Answer

No. Clear rules in the CC&Rs override arguments about aesthetics or resale value.

Detailed Answer

Even if a homeowner presents valid points about the superior look or potential resale value of a prohibited improvement (like LVP flooring vs. carpet), the ALJ will enforce the clear and unambiguous language of the governing documents.

Alj Quote

While Petitioner probably had valid points about the look and potential value of LVP flooring versus carpeting, unfortunately, the Declarations and Rules are clear and unambiguous…

Legal Basis

Enforcement of Governing Documents

Topic Tags

  • architectural control
  • property value
  • renovations

Question

What happens if I start a renovation without asking for HOA permission first?

Short Answer

You risk violating rules you weren't aware of and may be forced to stop or reverse the work.

Detailed Answer

Skipping the approval process is risky. If a homeowner fails to seek permission, they miss the opportunity to be informed of specific prohibitions before spending money on installation.

Alj Quote

Petitioner admitted that he did not seek permission from the Association to install the LVP flooring, which had he done, he probably would have been informed that the Rules did not allow for the same.

Legal Basis

Architectural Review Process

Topic Tags

  • procedural requirements
  • renovations
  • violations

Question

Who has to prove their case in an HOA dispute hearing?

Short Answer

The Petitioner (the homeowner filing the complaint) bears the burden of proof.

Detailed Answer

In an administrative hearing, the homeowner filing the petition must prove by a 'preponderance of the evidence' that the HOA violated the governing documents or laws.

Alj Quote

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated the Declarations and Association Rules.

Legal Basis

Burden of Proof (ARIZ. ADMIN. CODE R2-19-119)

Topic Tags

  • legal procedure
  • burden of proof
  • hearings

Question

What does 'preponderance of the evidence' mean?

Short Answer

It means the evidence shows the claim is more likely true than not.

Detailed Answer

The standard involves superior evidentiary weight that is sufficient to incline a fair and impartial mind to one side of the issue rather than the other.

Alj Quote

A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.

Legal Basis

Legal Standard of Evidence

Topic Tags

  • legal definitions
  • evidence

Question

If I lose my case against the HOA, will I get my filing fee back?

Short Answer

No. Reimbursement is generally denied if the petition is denied.

Detailed Answer

If the ALJ rules against the homeowner and denies the petition, the order will typically state that the Respondent (HOA) is not required to reimburse the filing fee.

Alj Quote

IT IS FURTHER ORDERED pursuant to ARIZ. REV. STAT. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee…

Legal Basis

ARIZ. REV. STAT. § 32-2199.02(A)

Topic Tags

  • costs
  • penalties
  • fees

Case

Docket No
23F-H066-REL
Case Title
Sebastien Verstraet v. Monterey Ridge Condominium Association
Decision Date
2023-11-13
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Sebastien Verstraet (petitioner)
    Appeared on his own behalf
  • Ron Riecks (witness)
    Flooring installer for Petitioner; also referred to as Ron Reichkes

Respondent Side

  • Joshua M. Bolen (attorney)
    Carpenter Hazlewood
  • Marcus R. Martinez (attorney)
    Carpenter Hazlewood
  • Robert Stein (property manager)
    City Property Management
    Testified as a witness for Respondent

Neutral Parties

  • Adam D. Stone (ALJ)
    OAH
  • Susan Nicolson (Commissioner)
    ADRE

Megan E Gardner v. Woodland Valley Ranch Property Owners Association,

Posted on by

Case Summary

Case ID 23F-H061-REL
Agency ADRE
Tribunal OAH
Decision Date 2023-10-16
Administrative Law Judge Adam D. Stone
Outcome The ALJ affirmed the petition, finding the Respondent HOA violated CC&Rs, Article 3, Section G by failing to provide 30 days' notice prior to the 2023 assessment increase. The Respondent was ordered to reimburse the Petitioner's filing fee.
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Megan E Gardner Counsel —
Respondent Woodland Valley Ranch Property Owners Association, Inc. Counsel Kyle A. von Johnson and Edith I. Rudder

Alleged Violations

CC&Rs, Article 3, Section G

Outcome Summary

The ALJ affirmed the petition, finding the Respondent HOA violated CC&Rs, Article 3, Section G by failing to provide 30 days' notice prior to the 2023 assessment increase. The Respondent was ordered to reimburse the Petitioner's filing fee.

Key Issues & Findings

Failure to provide 30-day notice for 2023 dues increase

The HOA increased annual dues from $200.00 to $240.00 effective 1/1/2023 due to a financial crisis caused by embezzlement, but failed to provide the required 30-day written notice as mandated by the CC&Rs. Although the increase was later refunded, the ALJ affirmed the petition finding the HOA failed to comply with the CC&Rs.

Orders: Petitioner's petition is affirmed. Respondent is ordered to reimburse Petitioner's $500.00 filing fee.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

  • CC&Rs, Article 3, Section G
  • ARIZ. REV. STAT. § 33-1804(D)
  • ARIZ. REV. STAT. § 32-2199.02(A)
  • ARIZ. REV. STAT. §§ 32-2102 and 32-2199 et al.

Analytics Highlights

Topics: HOA Dues Increase, Notice Violation, CC&R Violation, Embezzlement, Filing Fee Refund, Assessment Timing
Additional Citations:

  • CC&Rs, Article 3, Section G
  • ARIZ. REV. STAT. § 32-2199.02(A)
  • ARIZ. REV. STAT. § 33-1804(D)
  • ARIZ. REV. STAT. § 32-2102
  • ARIZ. REV. STAT. § 32-2199 et al.
  • ARIZ. REV. STAT. § 32-2199.05
  • ARIZ. REV. STAT. § 32-2199(2)
  • ARIZ. REV. STAT. § 32-2199.01(D)
  • ARIZ. REV. STAT. § 41-1092
  • ARIZ. REV. STAT. § 41-1092.09

Video Overview

Audio Overview

Decision Documents

23F-H061-REL Decision – 1077230.pdf

Uploaded 2026-04-24T12:12:40 (41.5 KB)

23F-H061-REL Decision – 1095389.pdf

Uploaded 2026-04-24T12:12:45 (44.3 KB)

23F-H061-REL Decision – 1095762.pdf

Uploaded 2026-04-24T12:12:51 (6.7 KB)

23F-H061-REL Decision – 1102356.pdf

Uploaded 2026-04-24T12:12:57 (110.9 KB)

23F-H061-REL Decision – 1077230.pdf

Uploaded 2026-01-23T17:59:31 (41.5 KB)

23F-H061-REL Decision – 1095389.pdf

Uploaded 2026-01-23T17:59:34 (44.3 KB)

23F-H061-REL Decision – 1095762.pdf

Uploaded 2026-01-23T17:59:37 (6.7 KB)

23F-H061-REL Decision – 1102356.pdf

Uploaded 2026-01-23T17:59:42 (110.9 KB)

This summary addresses the hearing proceedings, key arguments, and final decision in the case of *Megan E Gardner v Woodland Valley Ranch Property Owners Association, Inc.* (No. 23F-H061-REL), heard by Administrative Law Judge (ALJ) Adam D. Stone on October 2, 2023.

Key Facts and Main Issues

The dispute centered on the Association’s increase of the annual assessment from $200.00 to $240.00 for the 2023 calendar year.

Petitioner's Claim: Megan E. Gardner alleged the Association violated the Covenants, Conditions, and Restrictions (CCRs), specifically Article 3, Section G, which requires the regular assessment amount to be fixed and noticed at least thirty (30) days prior to the end of the calendar year (i.e., by December 1st). The Board voted on the increase on December 16, 2022, missing the required deadline.

Association's Defense (Respondent): The Association, represented by counsel, argued the violation was necessary due to extraordinary circumstances. The former property manager had embezzled nearly $500,000.00 of the Association’s funds in late 2022, leading to financial collapse. Facing an urgent $110,000.00 debt to the road maintenance contractor (crucial for maintaining 200 miles of necessary roadways), the Board had "no choice" but to raise rates to secure immediate funds. The Association asserted that the CCRs did not contemplate such a crisis.

Key Arguments and Legal Points

Respondent's Argument for Mootness: The Association testified that by April 2023, they recovered $387,000.00 in insurance proceeds. Consequently, they paid the debt and issued a $40.00 credit (refund) to all members around May 25, 2023. The Association argued that since the challenged assessment increase was refunded, the petition was moot.

Petitioner's Counter-Argument (Focus on Correction): Gardner received the refund but contended that the issue was not moot. She argued that a refund is not a correction. Gardner sought corrective action requiring the Board to create a formal written record and ensure transparency. She noted that the member portal still incorrectly displayed the $240.00 assessment amount, demonstrating a failure to correct the records and potentially confusing new homeowners. She emphasized that the Board must conduct business according to the CCRs going forward.

Outcome and Final Decision

The Administrative Law Judge issued a Decision on October 16, 2023, concluding that the Petitioner met her burden of proving the CCR violation by a preponderance of the evidence.

Legal Finding: The ALJ affirmed that while he sympathized with the "untenable and horrible position" the Association faced, the Board failed to comply with the CCR’s mandatory 30-day notice provision for the 2023 Assessment.

Order:

  1. Petitioner’s petition was affirmed.
  2. The Association was ORDERED to reimburse Petitioner’s filing fee ($500.00) pursuant to ARIZ. REV. STAT. § 32-2199.02(A), despite Gardner testifying that she was not seeking reimbursement.
  3. No civil penalty was awarded, as the Petitioner did not request one.

Questions

Question

Can my HOA raise dues without proper notice if they are facing a severe financial emergency?

Short Answer

No, financial crises do not exempt the HOA from following the notice timelines in the CC&Rs.

Detailed Answer

The ALJ ruled that even though the HOA was in an 'untenable' position due to embezzlement and urgent debts, they were still strictly bound to provide the specific notice (30 days in this case) required by the governing documents before increasing assessments.

Alj Quote

First, while the tribunal sympathizes with the untenable and horrible position that the Association was facing, it still failed to comply with the CCR’s, by not providing the 30 day notice prior to the 2023 yearly Assessment.

Legal Basis

CC&Rs Compliance

Topic Tags

  • Assessments
  • Emergency Powers
  • Notice Requirements

Question

If I win my hearing, will I get my filing fee back even if I tell the judge I don't want it?

Short Answer

Yes, the statute requires the filing fee to be reimbursed if the petitioner prevails, regardless of their personal preference.

Detailed Answer

The judge ordered the HOA to reimburse the $500 filing fee because the relevant statute (A.R.S. § 32-2199.01) binds the tribunal to order reimbursement when the petitioner wins, even though the homeowner explicitly testified she did not wish to recover it.

Alj Quote

At hearing, Petitioner testified that she did not wish to recovery her filing fee, the tribunal is bound by the statute to order the same.

Legal Basis

A.R.S. § 32-2199.01; A.R.S. § 32-2199.02(A)

Topic Tags

  • Filing Fees
  • Reimbursement
  • Statutory Mandates

Question

What level of proof do I need to provide to win a dispute against my HOA?

Short Answer

You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probable than not.

Detailed Answer

The homeowner bears the burden of proof. The standard is not 'beyond a reasonable doubt' (like in criminal cases), but rather showing that the evidence is sufficient to incline a fair mind to one side over the other.

Alj Quote

A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.

Legal Basis

A.R.S. § 33-1804(D); A.A.C. R2-19-119

Topic Tags

  • Burden of Proof
  • Legal Standards
  • Evidence

Question

Will the judge automatically fine the HOA if I prove they violated the rules?

Short Answer

No, if you do not specifically request a civil penalty in your petition, the judge generally will not award one.

Detailed Answer

In this case, although the HOA was found in violation, the judge ordered that no civil penalty be awarded specifically because the petitioner did not include a request for a penalty in her initial paperwork.

Alj Quote

IT IS FURTHER ORDERED that no civil penalty be awarded as Petitioner did not request the same in her Petition.

Legal Basis

Administrative Discretion

Topic Tags

  • Civil Penalties
  • Fines
  • Petition Drafting

Question

If the HOA fixes the problem (like refunding money) before the decision, is the case dismissed?

Short Answer

Not necessarily; the judge may still issue a decision affirming the violation occurred.

Detailed Answer

The HOA had already refunded the improper assessment increase to members before the decision was written. However, the ALJ still issued an order affirming the petition and finding that the HOA had failed to comply with the CC&Rs.

Alj Quote

The tribunal finds that Petitioner has met her burden. … Fortunately for the Association and the homeowners, it … was able to issue a refund of $40.00 to its members.

Legal Basis

Mootness (Implicitly Rejected)

Topic Tags

  • Refunds
  • Violations
  • Case Outcomes

Case

Docket No
23F-H061-REL
Case Title
Megan E Gardner v Woodland Valley Ranch Property Owners Association, Inc.
Decision Date
2023-10-16
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Questions

Question

Can my HOA raise dues without proper notice if they are facing a severe financial emergency?

Short Answer

No, financial crises do not exempt the HOA from following the notice timelines in the CC&Rs.

Detailed Answer

The ALJ ruled that even though the HOA was in an 'untenable' position due to embezzlement and urgent debts, they were still strictly bound to provide the specific notice (30 days in this case) required by the governing documents before increasing assessments.

Alj Quote

First, while the tribunal sympathizes with the untenable and horrible position that the Association was facing, it still failed to comply with the CCR’s, by not providing the 30 day notice prior to the 2023 yearly Assessment.

Legal Basis

CC&Rs Compliance

Topic Tags

  • Assessments
  • Emergency Powers
  • Notice Requirements

Question

If I win my hearing, will I get my filing fee back even if I tell the judge I don't want it?

Short Answer

Yes, the statute requires the filing fee to be reimbursed if the petitioner prevails, regardless of their personal preference.

Detailed Answer

The judge ordered the HOA to reimburse the $500 filing fee because the relevant statute (A.R.S. § 32-2199.01) binds the tribunal to order reimbursement when the petitioner wins, even though the homeowner explicitly testified she did not wish to recover it.

Alj Quote

At hearing, Petitioner testified that she did not wish to recovery her filing fee, the tribunal is bound by the statute to order the same.

Legal Basis

A.R.S. § 32-2199.01; A.R.S. § 32-2199.02(A)

Topic Tags

  • Filing Fees
  • Reimbursement
  • Statutory Mandates

Question

What level of proof do I need to provide to win a dispute against my HOA?

Short Answer

You must prove your case by a 'preponderance of the evidence,' meaning your claim is more probable than not.

Detailed Answer

The homeowner bears the burden of proof. The standard is not 'beyond a reasonable doubt' (like in criminal cases), but rather showing that the evidence is sufficient to incline a fair mind to one side over the other.

Alj Quote

A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.

Legal Basis

A.R.S. § 33-1804(D); A.A.C. R2-19-119

Topic Tags

  • Burden of Proof
  • Legal Standards
  • Evidence

Question

Will the judge automatically fine the HOA if I prove they violated the rules?

Short Answer

No, if you do not specifically request a civil penalty in your petition, the judge generally will not award one.

Detailed Answer

In this case, although the HOA was found in violation, the judge ordered that no civil penalty be awarded specifically because the petitioner did not include a request for a penalty in her initial paperwork.

Alj Quote

IT IS FURTHER ORDERED that no civil penalty be awarded as Petitioner did not request the same in her Petition.

Legal Basis

Administrative Discretion

Topic Tags

  • Civil Penalties
  • Fines
  • Petition Drafting

Question

If the HOA fixes the problem (like refunding money) before the decision, is the case dismissed?

Short Answer

Not necessarily; the judge may still issue a decision affirming the violation occurred.

Detailed Answer

The HOA had already refunded the improper assessment increase to members before the decision was written. However, the ALJ still issued an order affirming the petition and finding that the HOA had failed to comply with the CC&Rs.

Alj Quote

The tribunal finds that Petitioner has met her burden. … Fortunately for the Association and the homeowners, it … was able to issue a refund of $40.00 to its members.

Legal Basis

Mootness (Implicitly Rejected)

Topic Tags

  • Refunds
  • Violations
  • Case Outcomes

Case

Docket No
23F-H061-REL
Case Title
Megan E Gardner v Woodland Valley Ranch Property Owners Association, Inc.
Decision Date
2023-10-16
Alj Name
Adam D. Stone
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Megan E Gardner (petitioner)
    Property owner of Parcel 222

Respondent Side

  • Kyle A. von Johnson (HOA attorney)
    Woodland Valley Ranch Property Owners Association, Inc.
  • Edith I. Rudder (HOA attorney)
    Woodland Valley Ranch Property Owners Association, Inc.
  • Ronald Carter (Treasurer/Witness)
    Woodland Valley Ranch Property Owners Association, Inc.
    Treasurer since June 2022. Referred to as 'Ronald Cotter' in the ALJ Decision Findings of Fact.
  • David Goodman (Witness)
    Woodland Valley Ranch Property Owners Association, Inc.
    Appeared remotely; recruited to serve as President after previous board members resigned.

Neutral Parties

  • Adam D. Stone (ALJ)
    Office of Administrative Hearings (OAH)
  • Susan Nicolson (Commissioner)
    Arizona Department of Real Estate (ADRE)
  • AHansen (ADRE Staff)
    Arizona Department of Real Estate (ADRE)
    Listed for copy transmittal
  • vnunez (ADRE Staff)
    Arizona Department of Real Estate (ADRE)
    Listed for copy transmittal
  • djones (ADRE Staff)
    Arizona Department of Real Estate (ADRE)
    Listed for copy transmittal
  • labril (ADRE Staff)
    Arizona Department of Real Estate (ADRE)
    Listed for copy transmittal