Tag Archives: Tammy L. Eigenheer

Jurisdictional Analysis in Satterlee v. Green Valley Country Club Vistas II POA

Executive Summary

This document outlines the legal analysis and final decision in case number 18F-H1817022-REL, wherein the Office of Administrative Hearings (OAH) dismissed a petition filed by Thomas P. Satterlee against the Green Valley Country Club Vistas II Property Owner’s Association. The dismissal was based on a lack of subject matter jurisdiction.

The central issue was whether the Respondent association qualified as a “planned community” under Arizona statute A.R.S. § 33-1802(4). This determination hinged entirely on the interpretation of the phrase “covenant to maintain roadways.” The Petitioner argued that the association’s maintenance of landscaping at the community’s entrance constituted roadway maintenance, asserting a broad definition of “roadway” that encompassed the entire right-of-way, supported by the modern civil engineering concept of “Complete Streets.”

The Administrative Law Judge (ALJ) rejected this argument, concluding that the plain meaning of “roadway” refers specifically to the portion of a road used by vehicles. The ALJ noted that the state legislature used the specific term “roadway” in a 2014 statutory amendment, even though the broader “Complete Streets” concept was already well-established, indicating a deliberate choice of the narrower term. Ultimately, because the association’s activities did not include maintaining roadways, it was not deemed a “planned community,” and therefore, the OAH and the Arizona Department of Real Estate lacked jurisdiction to hear the case. The petition was dismissed with prejudice.

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Case Overview and Procedural History

The matter of Thomas P. Satterlee v. Green Valley Country Club Vistas II Property Owner’s Association (Case No. 18F-H1817022-REL) was adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute was a dispositive motion concerning the OAH’s subject matter jurisdiction over the Respondent association.

• January 26, 2018: The Respondent filed a Motion to Dismiss, arguing the OAH lacked jurisdiction because the association was not a “planned community” as defined by A.R.S. § 33-1802(4).

• March 15, 2018: Following oral arguments, the ALJ issued an initial decision finding that the OAH lacked jurisdiction and dismissed the petition.

• April 10, 2018: The Petitioner filed a Homeowner’s Association (HOA) Dispute Rehearing Request with the Arizona Department of Real Estate.

• May 3, 2018: The Commissioner granted the Petitioner’s request for a rehearing.

• September 5, 2018: A new round of oral arguments was held, focusing again on the dispositive jurisdictional issue.

• September 25, 2018: The ALJ issued a final decision, once again dismissing the petition with prejudice for lack of subject matter jurisdiction.

The Central Jurisdictional Question

The jurisdiction of the Office of Administrative Hearings and the Arizona Department of Real Estate in this matter was entirely dependent on whether the Respondent association met the statutory definition of a “planned community.” A lack of subject matter jurisdiction is a non-waivable issue that voids any administrative decisions made without it.

The pivotal question was whether the association’s maintenance of landscaping around the walls and sign at the community entrance constituted a “covenant to maintain roadways,” which is a key criterion in the statute.

Statutory Framework: A.R.S. § 33-1802(4)

The relevant statute, A.R.S. § 33-1802(4), defines a “planned community” as:

“…a real estate development that includes real estate owned and operated by or real estate on which an easement to maintain roadways or a covenant to maintain roadways is held by a nonprofit corporation or unincorporated association of owners…”

A 2014 amendment to this statute added the language regarding an “easement to maintain roadways or a covenant to maintain roadways.” Before this amendment, an association had to own real property to be considered a planned community.

Arguments of the Parties

The dispute centered on the interpretation of the single word “roadways” within the statute.

Petitioner’s Position (Thomas P. Satterlee)

The Petitioner argued for a broad and expansive interpretation of “roadway,” asserting that it should include the entire right-of-way.

• Core Argument: The developer built walls and an entrance sign, and the Respondent’s subsequent maintenance of the surrounding landscaping constitutes a “covenant to maintain roadways.”

• “Complete Streets” Concept: The Petitioner presented extensive documentation to argue that the modern civil engineering approach of “Complete Streets” supports his interpretation. This concept treats the entire transportation corridor—including sidewalks, bicycle lanes, transit stops, and landscaping—as an integrated system for all users.

• Equivalency of Terms: The Petitioner claimed that “roadway” is the “new word for ‘street'” and that the “roadway” encompasses the entire width of the “right-of-way.”

• Evidence Presented: The Petitioner submitted numerous documents to support his claim, including:

◦ A letter from the Pima County Director of Transportation confirming the association’s maintenance of landscaping.

◦ Excerpts from the Pima County Roadway Design Manual (RDM).

◦ Pima County Board of Supervisors policies on landscaping in the right-of-way.

◦ Website printouts from the U.S. Department of Transportation, Federal Highway Administration, and other entities defining “Complete Streets.”

◦ Pima County Code of Ordinances related to roadway projects.

Respondent’s Position (Green Valley Country Club Vistas II POA)

The Respondent advocated for a strict, plain-meaning interpretation of the statute.

• Core Argument: The maintenance of landscaping does not constitute the maintenance of a “roadway.”

• Legislative Intent: The Respondent argued that the Arizona legislature deliberately chose the specific term “roadway” when it amended the statute in 2014. By that time, the “Complete Streets” concept was well-known. Had the legislature intended a broader scope, it could have used terms like “right-of-way” or “Complete Streets,” but it did not.

• Conclusion: Because the association does not have a covenant to maintain roadways, it does not meet the statutory definition of a “planned community,” and therefore the state agencies lack jurisdiction.

Administrative Law Judge’s Analysis and Decision

The ALJ’s decision was grounded in principles of statutory construction, focusing on the plain meaning of the legislative language.

The ALJ began with the legal principle that when construing statutes, a court must first look to the language of the statute and give the words their plain meaning, presuming the legislature expressed its meaning as clearly as possible.

To determine the plain meaning, the ALJ consulted numerous dictionary definitions of “roadway” and “street.”

Source

Definition of “Roadway”

English Oxford Living Dict.

“The part of a road intended for vehicles, in contrast to the pavement or verge.”

Merriam-Webster

“the part of a street reserved for vehicles.”

Dictionary.com

“The part of a road over which vehicles travel; road.”

Cambridge Dictionary

“the part of the road on which vehicles drive.”

American Heritage Dictionary

“A road, especially the part over which vehicles travel.”

Oxford Learner’s Dictionaries

“a road or the part of a road used by vehicles.”

The ALJ concluded that the consistent, plain meaning of “roadway” is the portion of a road upon which vehicles travel, distinct from adjacent areas like sidewalks or landscaping.

The ALJ found the Petitioner’s evidence regarding the “Complete Streets” concept to be irrelevant to the statutory interpretation. The decision noted that because the legislature amended the statute after this concept was widely adopted but chose to use the narrower term “roadway,” it signaled a clear intent not to encompass the entire right-of-way. The ALJ stated:

“Had the legislature intended to include associations such as Respondent in the definition of ‘planned community’ in A.R.S. § 33-1802(4), it could have used the term ‘right-of-way’ or ‘Complete Streets’.”

The ALJ highlighted that several documents submitted by the Petitioner actually undermined his argument by explicitly distinguishing between “roadway” and “right-of-way.”

• Pima County Code 10.56.020: This ordinance defines minor projects to include “[c]hanges or improvements to the right-of-way area outside the shoulder of an existing roadway.”

• Pima County RDM: The design manual specified different drawing scales for “Roadway Plans” (1” = 40’) and “Landscape Plans” (1” = 20’).

• Pima County RDM Statement: Another document stated that the “[i]nstallation of landscaping shall begin not later than six months after the formal completion date of the roadway project.”

These examples demonstrated that, even within the Petitioner’s own evidence, “roadway” and “landscaping” within the “right-of-way” are treated as distinct elements.

Final Order and Implications

Based on the analysis, the ALJ reached a definitive conclusion on the jurisdictional question.

• Finding: The association’s maintenance of the area around the entrance walls and sign does not render it a “planned community” because this activity is not maintenance of “roadways” as understood by the statute’s plain meaning.

• Order: The petition was dismissed with prejudice on September 25, 2018.

• Legal Consequence: The Office of Administrative Hearings and the Arizona Department of Real Estate lack subject matter jurisdiction over the petition.

• Further Recourse: The decision explicitly states that the Petitioner remains free to file an action in a court of competent jurisdiction as specified by the Respondent’s community documents.

Administrative Hearing Briefing: Cohen v. CBS 136 Homeowners Association

Executive Summary

This document synthesizes the findings and decision from the administrative hearing case Annette Cohen v. CBS 136 Homeowners Association (No. 18F-H1818033-REL). The core of the dispute was the Homeowners Association’s (HOA) failure to provide requested documents—specifically, meeting sign-in sheets—to a member, Annette Cohen, within the ten-business-day timeframe mandated by Arizona statute A.R.S. § 33-1258.

At the hearing, the Respondent HOA acknowledged this “technical violation,” attributing the delay to operational difficulties arising from a recent change in management companies. The Petitioner, Ms. Cohen, argued the delay was intentional and warranted a civil penalty.

The Administrative Law Judge, Tammy L. Eigenheer, found that the HOA did violate the statute. In the final order, the Judge declared Ms. Cohen the prevailing party and mandated future compliance by the HOA. While a civil penalty was deemed inappropriate under the circumstances, the Judge ordered the HOA to reimburse Ms. Cohen’s $500 filing fee.

Case Overview

Entity / Individual

Petitioner

Annette Cohen

Respondent

CBS 136 Homeowners Association (CBS)

Respondent’s Counsel

Brian Ditsch, Sacks Tierney P.A.

Respondent’s Mgmt. Co.

Key Witness

Susan Rubin (PRM)

Adjudicating Body

Office of Administrative Hearings, Phoenix, Arizona

Administrative Law Judge

Tammy L. Eigenheer

Case Number

18F-H1818033-REL

Hearing Date

June 6, 2018

Decision Date

June 26, 2018

Chronology of the Dispute

The dispute centered on two separate sets of document requests made by Petitioner Annette Cohen.

• Request 1 (January 10 Meeting):

◦ On or about Jan. 10, 2018: Ms. Cohen requested the sign-in sheets from the annual meeting held on this date.

◦ Jan. 2018: The management company PRM took over management of the CBS 136 HOA.

◦ Feb. 15, 2018: After more than a month, and after two scheduled review appointments were cancelled by the management company, the sign-in sheets were finally provided to Ms. Cohen by email.

• Request 2 (February 15 Meeting):

◦ Feb. 19, 2018: Ms. Cohen requested the sign-in sheets from the February 15, 2018 HOA meeting. Receipt of this request was acknowledged by PRM.

◦ Feb. 21, 26, 27 & March 5, 2018: Ms. Cohen made repeated follow-up requests for the same information.

• Formal Proceedings:

◦ March 9, 2018: Ms. Cohen filed a formal petition with the Arizona Department of Real Estate.

◦ April 10, 2018: The Respondent HOA filed an answer denying all allegations.

◦ June 6, 2018: An administrative hearing was held. The documents had been provided to Ms. Cohen at some point prior to this hearing.

◦ June 26, 2018: The Administrative Law Judge issued the final decision.

Core Allegation and Legal Framework

Petitioner’s Allegation

Annette Cohen alleged that the CBS 136 Homeowners Association violated A.R.S. Title 33, Chapter 16, Section 33-1258 by failing to provide association records for review and copying within the statutorily required timeframe.

Governing Statute: A.R.S. § 33-1258(A)

The legal basis for the petition is Arizona Revised Statute § 33-1258(A), which governs a member’s right to access association records. The statute states, in relevant part:

“all financial and other records of the association shall be made reasonably available for examination by any member… The association shall have ten business days to fulfill a request for examination. On request for purchase of copies of records by any member… the association shall have ten business days to provide copies of the requested records. An association may charge a fee for making copies of not more than fifteen cents per page.”

The petitioner bears the burden of proving a violation by a preponderance of the evidence, defined as evidence that “shows that the fact sought to be proved is more probable than not.”

Arguments and Evidence Presented at Hearing

Once the Respondent acknowledged the delay, the hearing focused solely on determining the appropriate remedy.

Petitioner’s Position (Annette Cohen)

• Intentional Negligence: Ms. Cohen argued that the Respondent “intentionally ignored her request for the documents.”

• Request for Penalty: Based on the belief of intentional neglect, she asserted that a civil penalty was an appropriate remedy.

• Unreasonable Delay: She noted that the documents “could have easily been emailed to her within the 10 day deadline,” but that the HOA’s management company did not present this as an option until after the deadline had already passed.

Respondent’s Position (CBS 136 HOA)

• Acknowledged Violation: At the June 6, 2018 hearing, the Respondent “acknowledged that the requested documents were not provided within the 10 day timeframe set forth in statute.”

• Mitigating Circumstances: The defense centered on testimony from Susan Rubin of the management company, PRM. Ms. Rubin testified to the following:

◦ No requests are “ever purposefully ignored.”

◦ PRM had only taken over management of the HOA in January 2018.

◦ At the time of the requests, PRM was “still getting documents from the former management company.”

◦ The delay was not due to ignoring the request, but because it “took a little longer than expected to provide the documents.”

Administrative Law Judge’s Decision and Order

Findings and Conclusions

• Violation Established: The Judge concluded there was “no dispute that Respondent failed to provide the requested documents within 10 days.” Therefore, the Petitioner “established by a preponderance of the evidence that Respondent violated A.R.S. § 33-1258(A).”

• Rejection of Civil Penalty: Despite the Petitioner’s argument, the Administrative Law Judge did “not find such a penalty to be appropriate given the circumstances in this matter.”

Final Order

The Judge issued a three-part order binding on the parties:

1. Prevailing Party: The Petitioner, Annette Cohen, is “deemed the prevailing party.”

2. Future Compliance: The Respondent, CBS 136 Homeowners Association, is ordered to “comply with the applicable provisions of A.R.S. § 33-1258(A) in the future.”

3. Reimbursement of Filing Fee: The Respondent must pay the Petitioner her filing fee of $500.00 directly to her within thirty (30) days of the order.

Briefing Document: Holyoak v. Camelback Country Club Estates HOA

Executive Summary

This briefing document synthesizes the findings and conclusions from an Administrative Law Judge Decision concerning two consolidated petitions filed by homeowner Jon Paul Holyoak against the Camelback Country Club Estates I & II Homeowners Association (HOA). The disputes centered on HOA-issued violations for landscaping maintenance and the presence of a freestanding mailbox.

The final judgment produced a split decision. The Petitioner, Mr. Holyoak, failed to prove the HOA acted improperly in the landscaping case and his petition was denied. However, he was deemed the prevailing party in the mailbox case, with the judge concluding the HOA had violated its own community documents (CC&Rs) by imposing a fine based on an inapplicable section. As the prevailing party in one of the two matters, Mr. Holyoak was awarded his $500 filing fee, to be paid by the HOA. The initial decision document required two subsequent nunc pro tunc orders to correct typographical errors.

Key Takeaways:

• Landscaping Petition (Denied): Mr. Holyoak was cited for failing to remove a “dead” olive tree. He argued the tree was merely “in distress.” The judge ruled that a reasonable person would consider the tree dead and that Mr. Holyoak failed to provide sufficient evidence to the contrary. A dead tree was found to be a potential violation of CC&R Section 28, which requires plantings to be “neatly trimmed” and “properly cultivated.”

• Mailbox Petition (Upheld): Mr. Holyoak was cited for an “additional mailbox” that was present when he purchased the property in 2012. The judge found the HOA’s enforcement problematic for two primary reasons:

1. The HOA cited three different CC&R sections across multiple notices.

2. The fine was ultimately based on Section 12, which pertains to “buildings” and was deemed inapplicable to a mailbox.

• Final Order: The HOA was ordered to pay the Petitioner’s $500 filing fee. The decision is binding on the parties.

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Case Overview

The matter involves two petitions filed on February 2, 2018, by Petitioner Jon Paul Holyoak with the Arizona Department of Real Estate against the Respondent, Camelback Country Club Estates I & II Homeowners Association. The petitions alleged that the HOA had improperly cited Mr. Holyoak for violations of the community’s Conditions, Covenants, and Restrictions (CC&Rs). The two cases were consolidated for a single hearing.

Detail

Information

Case Numbers

18F-H1818030-REL (Landscaping)
18F-H1818031-REL (Mailbox)

Petitioner

Jon Paul Holyoak

Respondent

Camelback Country Club Estates I & II Homeowners Association (represented by Gary Linder and Diana Elston)

Hearing Date

May 2, 2018

Decision Date

May 25, 2018

Presiding Judge

Administrative Law Judge Tammy L. Eigenheer

Legal Framework

The Petitioner bore the burden of proving by a preponderance of the evidence that the Respondent violated the community CC&Rs and A.R.S. § 33-1805(A).

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Petition 1: Landscaping Violations (Case No. 18F-H1818030-REL)

This petition alleged that the HOA improperly cited Mr. Holyoak for violating Section 28 of the CC&Rs, which governs landscape maintenance.

HOA Actions and Timeline

The HOA, through its inspection team Associa Arizona, issued a series of notices regarding the landscaping on Mr. Holyoak’s property.

Notice Type

Description

Oct 17, 2017

Courtesy Notice

“Please remove the dead foliage on your lot.”

Dec 13, 2017

Courtesy Notice

“Please remove the dead olive tree in the front yard.”

Dec 13, 2017

Courtesy Notice

“There are several other trees that need to be removed as they have dead branches including the cassia…”

Jan 25, 2018

Notice of Violation

“2nd notice…There are several other trees that need to be removed as they have dead branches…” (Included photo of backyard).

Arguments Presented

• Petitioner’s Position (Holyoak):

◦ The olive tree in the front yard was not “dead” but rather “in distress,” and he was actively trying to nurse it back to health. He eventually had the tree removed on April 25, 2018, after months of effort.

◦ Regarding the backyard photo attached to the fine notice, he argued that the olive tree visible was healthy and that no dead trees were depicted.

◦ He requested that the fine be abated.

• Respondent’s Position (HOA):

◦ Board member Terry Rogers testified that the front yard olive tree had no leaves, appeared dead from the roadway, and was therefore not “properly trimmed” as required.

◦ He stated the backyard notice referred to a eucalyptus tree with several dead branches visible from the sidewalk bordering the property.

Administrative Law Judge’s Findings and Conclusion

The judge ruled in favor of the HOA in this matter.

• Burden of Proof: The Petitioner failed to present sufficient evidence, beyond “his self-serving statements,” that the olive tree was alive.

• Reasonable Interpretation: The judge concluded that “Any reasonable person viewing the olive tree, as depicted in the photographs presented, would understand the tree to be dead.”

• Violation of CC&Rs: A dead tree could reasonably be considered as not being “neatly trimmed” or “properly cultivated” in accordance with Section 28.

• Verdict: The Petitioner’s petition was denied. The judge found that the HOA had not improperly fined him for the landscaping violation.

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Petition 2: Unapproved Structure/Mailbox (Case No. 18F-H1818031-REL)

This petition alleged that the HOA improperly cited Mr. Holyoak for having an “additional mailbox” in violation of the CC&Rs.

HOA Actions and Timeline

The HOA’s notices for the mailbox cited three different sections of the CC&Rs over time.

Notice Type

Description

CC&R Section Cited

Oct 17, 2017

Courtesy Notice

“Please remove the additional mailbox on your lot.”

Section 27

Dec 14, 2017

Courtesy Notice

“…there is an additional mailbox on your lot. In research of our files, there is no architectural application on file for the modification.”

Section 12

Jan 25, 2018

Notice of Violation

“2nd notice…Please remove the mailbox or provide the approved architectural application.” (Mailbox was painted bright pink and yellow at this time).

Section 12

Jan 25, 2018¹

Notice of Violation

“3rd notice…Please remove the mailbox or provide the approved architectural application.”

Section 8

¹The decision document states this notice was sent on January 25, 2018, but references a violation noted on March 15, 2018. The judge’s conclusions later clarify a notice referencing Section 8 was issued April 11, 2018, and was not properly before the tribunal.

Arguments Presented

• Petitioner’s Position (Holyoak):

◦ The freestanding mailbox was already in place when he purchased the home in 2012.

◦ At the time of purchase, he received a statement that there were no known covenant violations on the property.

◦ He argued the mailbox is required by the United States Postal Service (USPS), which no longer provides walking delivery and requires mailboxes to be reachable from a vehicle. The home’s other mailbox, built into a monument, is approximately 15 feet from the curb.

◦ A USPS mail carrier had confirmed this delivery requirement.

• Respondent’s Position (HOA):

◦ Board member Terry Rogers testified that the USPS mail carrier told him he would prefer to deliver to the permanent monument mailbox because the freestanding one was not secure.

◦ The mailbox had become an “eyesore,” as it was faded, peeling, and “listing to one side.”

◦ Of the 61 homes in the community, only three have freestanding mailboxes, and the Petitioner is the only one with two mailboxes.

Administrative Law Judge’s Findings and Conclusion

The judge ruled in favor of the Petitioner in this matter.

• Inconsistent Enforcement: The judge found it “problematic” that the HOA relied on three different sections of the CC&Rs in its notices.

• Pre-existing Structure: The Petitioner established that the mailbox was present at the time of his 2012 home purchase and that he was told of no existing violations. Therefore, the HOA’s argument regarding the lack of an architectural approval was “without merit.”

• Inapplicable CC&R Section: The fine was imposed based on Section 12 of the CC&Rs. The judge determined the plain language of this section relates to a “building” and “cannot be read to apply to Petitioner’s mailbox.”

• Violation by HOA: By imposing a fine based on an inapplicable section, the HOA was in violation of the CC&Rs.

• Verdict: The Petitioner was deemed the prevailing party. The judge noted that the HOA could potentially impose fines for failure to maintain the mailbox or for painting it without approval, but those specific violations were not before the court.

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Final Order and Subsequent Corrections

• Order of May 25, 2018:

1. Petitioner’s petition in Case Number 18F-H1818030-REL (Landscaping) is denied.

2. Petitioner is deemed the prevailing party in Case Number 18F-H1818031-REL (Mailbox).

3. Respondent (HOA) is ordered to pay Petitioner his $500.00 filing fee within thirty days.

• Order Nunc Pro Tunc of May 30, 2018:

◦ This order corrected a typographical error in the original decision. The original text mistakenly stated the petition for the mailbox case (31-REL) was denied.

◦ Correction: The denial was correctly applied to the landscaping case: “it is ORDERED that Petitioner’s petition in Case Number 18F-H1818031-REL 18F-H1818030-REL is denied.”

• Order Nunc Pro Tunc of May 31, 2018:

◦ This order corrected a typographical error in the May 30 order, which had misstated the date of the original decision.

◦ Correction: “On April 26 May 25, 2018, the Administrative Law Judge issued the Administrative Law Judge Decision…”

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Key CC&R Sections Cited

• Section 8 (Architectural Control): Requires written approval from the Committee before any “building or other structure” is erected, altered, or repaired. This includes exterior finish, color, and architectural style.

• Section 12 (Buildings): States that “No building may be erected or maintained upon any Lot except one single family dwelling with private appurtenant garage and customary outbuildings” without prior written approval.

• Section 27 (Maintenance): Prohibits any building or structure from falling into disrepair and requires owners to keep them in good condition and adequately painted.

• Section 28 (Landscaping): Requires the owner of each lot to “at all times keep shrubs, trees, grass and plantings of every kind, on his lot mostly trimmed, properly cultivated, and free of trash, weeds and other unsightly material.”

Administrative Hearing Brief: Duffett vs. Suntech Patio Homes HOA

Executive Summary

This briefing document analyzes the Administrative Law Judge Decision in two consolidated cases filed by homeowner Rex E. Duffett against the Suntech Patio Homes Homeowners Association (HOA). The ruling presents a split decision, with the petitioner prevailing on one claim while failing to provide sufficient evidence for the other.

The first petition, concerning the HOA’s alleged failure to repair exterior walls, was denied. The petitioner failed to meet the burden of proof, as the submitted photographic evidence was unclear and did not sufficiently establish the existence or severity of the damage requiring immediate repair.

The second petition, concerning the HOA’s failure to provide association records upon request, was upheld. The judge found that the HOA, through its former management company, violated state law (A.R.S. § 33-1805(A)) by not responding to a formal document request within the mandated ten-business-day window.

As a result, Mr. Duffett was deemed the prevailing party in the records-request case. The HOA was ordered to pay his $500 filing fee and to ensure future compliance with the relevant statutes. The case highlights critical issues of evidence quality in homeowner disputes and demonstrates the legal liability an HOA retains for the failures of its management agents, particularly during periods of transition.

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Case Overview

Case Numbers

18F-H1818025-REL and 18F-H1818027-REL (Consolidated)

Petitioner

Rex E. Duffett

Respondent

Suntech Patio Homes Homeowners Association

Hearing Date

April 4, 2018

Decision Date

April 24, 2018

Presiding Judge

Administrative Law Judge Tammy L. Eigenheer

The hearing addressed two separate petitions filed by Rex E. Duffett with the Arizona Department of Real Estate:

1. Petition 1 (18F-H1818025-REL): Alleged the HOA violated community CC&Rs by failing to repair exterior walls of the petitioner’s unit.

2. Petition 2 (18F-H1818027-REL): Alleged the HOA violated A.R.S. § 33-1805(A) by failing to provide requested documents.

Petition 1: Failure to Repair Exterior Walls (Denied)

Petitioner’s Allegations and Evidence

• Core Claim: The petitioner alleged the HOA failed its duty, as defined by a March 1993 amendment to the CC&Rs, to maintain the exterior walls of his unit. The CC&Rs state, “The Suntech Patio Homeowners Association shall be responsible for the painting and maintenance of the following: A) Exterior walls of all units . . . .”

• Initial Request (July 14, 2017): Mr. Duffett faxed the HOA’s management company, The Management Trust, stating, “While inspecting the outside of my property I noticed a crack in the exterior wall. Please inspect, repair and paint the wall as soon as possible to prevent any damage which could result from rain water in the interior of the wall.”

• Follow-Up Request (August 21, 2017): In a certified letter, Mr. Duffett provided more detail, identifying a crack in the entryway wall allowing “rain water to seep into the interior wall,” a “bare concrete” area on the garage, and a previously cracked garage wall that had been repaired by a roofing company but not painted.

• Hearing Testimony: Mr. Duffett testified that a roofing company he hired to find a leak in his garage ceiling determined the source was not the roof but a crack in the exterior wall.

• Submitted Evidence: The petitioner submitted five black-and-white photographs of his home’s exterior across his two communications.

Respondent’s Position and Evidence

• Management Transition: Pride Community Management took over from The Management Trust on February 1, 2018. The new manager, Rebecca Stowers, and owner, Frank Peake, testified to a difficult transition where The Management Trust initially provided only one box of records, later discovering seven or eight more boxes in storage. Mr. Peake stated that Pride had not seen the petitioner’s communications regarding the damage until the hearing.

• Inspection: Ms. Stowers testified that she inspected the petitioner’s home on March 27, 2018. While she noted “a missing area of stucco on the front of the garage that needed to be repaired,” she “denied being able to identify a crack in the stucco anywhere else on the front of the house.”

• Community-Wide Repair Plan: Ms. Stowers stated that the HOA intended to repair the stucco and paint all exterior walls in the community during the 2018 calendar year at a projected cost of $46,000, to be funded potentially through a special assessment due to the HOA being underfunded.

Conclusion of Law and Ruling

• Burden of Proof: The Administrative Law Judge (ALJ) determined that the petitioner bore the burden of proving his claim by a preponderance of the evidence.

• Evidence Failure: The ALJ found the submitted evidence insufficient. The decision states: “The black and white photographs submitted at hearing did not clearly show the crack Petitioner alleged existed on the exterior wall of his unit… The Administrative Law Judge was unable to identify the location or severity of the alleged crack, and therefore, cannot conclude that such a crack exists and/or that it is necessary to be repaired immediately.”

• Final Ruling: The petitioner failed to meet his burden of proof. The petition in Case Number 18F-H1818025-REL was denied.

Petition 2: Failure to Provide Association Records (Upheld)

Petitioner’s Allegations and Evidence

• Core Claim: The petitioner alleged that the HOA violated A.R.S. § 33-1805(A), which requires an association to fulfill a request for records within ten business days.

• The Request (December 22, 2017): Mr. Duffett faxed The Management Trust a request for specific documents, citing a statement made by the HOA in a separate case. He requested copies of:

◦ Meeting notices and minutes for all meetings where “rules and regulations were discussed” in August/September 2017.

◦ Meeting notices and minutes for meetings where the last HOA dues increase was discussed.

◦ A copy of the notice for the last association rate increase.

Respondent’s Position and Evidence

• Lack of Awareness: The HOA’s initial response on January 29, 2018, indicated it had only become aware of the request upon receiving notice of the petition. The current management company, Pride, testified they had not seen the original communication from the petitioner.

• Vagueness of Request: Frank Peake of Pride testified that the request for minutes of meetings “where the rules and regulations were discussed” was unclear “because rules and regulations are discussed in some form at virtually every meeting of the association.”

• Claim of Privilege: The initial response from The Management Trust on January 29, 2018, claimed that the requested minutes were for “closed executive meetings and were only available to Board members.”

Conclusion of Law and Ruling

• Statutory Violation: The ALJ concluded that the petitioner clearly made a request for documents and that the HOA, via its former management company, failed to act as required by law.

• Failure of Former Management: The decision explicitly faults the prior management company: “The Management Trust should have responded or requested additional clarification of what documents Petitioner was requesting as it was the management company during the ten day window Respondent had to respond pursuant to the statute.”

• Final Ruling: The petitioner successfully established by a preponderance of the evidence that the HOA violated A.R.S. § 33-1805(A). Mr. Duffett was deemed the prevailing party in Case Number 18F-H1818027-REL.

Final Order and Implications

The Administrative Law Judge issued the following orders based on the conclusions of law:

Case Number

Subject

Ruling

18F-H1818025-REL

Exterior Wall Repairs

Petition Denied

18F-H1818027-REL

Document Request

Petitioner Deemed Prevailing Party

Directives to the Respondent (Suntech Patio Homes HOA):

1. Future Compliance: The HOA must comply with the provisions of A.R.S. § 33-1805(A) going forward.

2. Payment of Filing Fee: The HOA must pay the petitioner his filing fee of $500.00 within thirty (30) days of the order.

This order is considered binding on the parties unless a rehearing is granted.

**Case Summary: Satterlee v. Green Valley Country Club Vistas II Property Owners’ Association Case Numbers: 17F-H1716018-REL-RHG / 17F-H1716022-REL-RHG Forum: Arizona Office of Administrative Hearings (OAH) Date of Decision:** March 15, 2018

Procedural Context: Rehearing This administrative decision is explicitly a rehearing of consolidated matters previously decided in 2017. The Administrative Law Judge (ALJ) addressed a renewed challenge regarding whether the Arizona Department of Real Estate (ADRE) and OAH possessed subject matter jurisdiction over the dispute,.

I. Original Proceedings (2017)

• Procedural History: In the original proceeding, the Respondent (Green Valley Country Club Vistas II) filed a Motion to Dismiss, arguing it did not meet the statutory definition of a "planned community" under A.R.S. § 33-1802(4) because it did not own real estate or possess roadway easements,.
• Original Outcome: On July 7, 2017, the Commissioner accepted the ALJ’s recommendation to dismiss the case. The ALJ found that the Respondent was not a "planned community," and therefore, the administrative bodies lacked jurisdiction to hear the petitions,.
• Transition to Rehearing: The Petitioner (Thomas Satterlee) filed a notice of rehearing in September 2017, which the Commissioner granted,.

II. Rehearing Proceedings (2018)

• Main Issue: The central legal issue remained whether the Respondent qualified as a "planned community," which determines whether the OAH has subject matter jurisdiction. The specific dispute focused on statutory interpretation regarding the maintenance of community entrances,.
• Key Arguments:
• Petitioner’s Argument: The Petitioner argued that because the developer built walls and a sign at the community entrance, and the Respondent maintained the landscaping around them, the Association held a "covenant to maintain roadways." The Petitioner urged the ALJ to interpret "roadway" broadly to include "roadway systems," encompassing the land and improvements at the entrance.
• Respondent’s Argument: The Respondent renewed its Motion to Dismiss, asserting that landscaping around a sign does not constitute a "roadway." Consequently, the Association still lacked the necessary covenant to maintain roadways required by A.R.S. § 33-1802(4) to qualify as a planned community,.

III. Legal Analysis and Final Decision The ALJ ruled in favor of the Respondent, dismissing the petitions with prejudice. The decision rested on the following legal points:

1. Subject Matter Jurisdiction: The ALJ emphasized that administrative jurisdiction is strictly defined by statute. Jurisdiction cannot be waived, nor can it be conferred by the agreement or estoppel of the parties, [

Administrative Law Judge Decision Analysis: Brown v. Terravita Country Club, Inc.

Executive Summary

This briefing document synthesizes the findings and conclusions of the Administrative Law Judge (ALJ) in case number 18F-H1717041-REL, concerning a dispute between homeowner William Brown (Petitioner) and the Terravita Country Club, Inc. (Respondent). The ALJ ultimately ruled in favor of the Respondent, denying the Petitioner’s claim that the homeowners association violated Arizona state law regarding notification procedures before imposing penalties.

The central issue revolved around the interpretation of “notice” as required by Arizona Revised Statutes (A.R.S.) § 33-1803(B). The Petitioner argued that the statute requires “actual notice”—proof of personal receipt of a notification—which he claimed he never received for a critical disciplinary hearing. The ALJ rejected this argument, establishing that “constructive notice” is legally sufficient. Constructive notice was deemed to have been achieved through the Respondent’s documented efforts to deliver notice via both certified and first-class mail.

A key factor in the decision was the ALJ’s finding that the Petitioner’s testimony was “not credible” regarding his claim that the United States Postal Service (USPS) failed to notify him of a certified letter. The decision upholds the sanctions imposed by the association, which include an indefinite suspension of membership privileges, a $2,500 fine, and the recoupment of $5,000 in related expenses.

Case Background and Timeline

The dispute originated from an incident on November 29, 2016, where Petitioner William Brown was alleged to have left a box of matches at the Respondent’s clubhouse containing papers listing several club properties. This act was interpreted as a threat, leading the Terravita Country Club to initiate disciplinary proceedings. Mr. Brown subsequently filed a petition with the Arizona Department of Real Estate on June 28, 2017, alleging the club failed to provide proper notice before taking action.

Nov 29, 2016

William Brown allegedly leaves a box of matches and notes at the clubhouse.

Dec 2, 2016

The club’s General Manager sends a letter to Brown notifying him of an immediate suspension pending a review.

Dec 8, 2016

Brown signs for and receives the certified mail delivery of the December 2 suspension letter.

Dec 14, 2016

The club sends a letter via first-class and certified mail notifying Brown of a January 9, 2017, Infractions Committee hearing.

Dec 24, 2016

USPS tracking shows the December 14 certified letter is “out for delivery” at Brown’s temporary address in Coldspring, Texas.

Jan 9, 2017

The Infractions Committee meets; Brown does not attend. The Committee sends a letter recommending indefinite suspension and fines.

Jan 12, 2017

The unclaimed December 14 certified letter is returned by the USPS to the club.

Jan 31, 2017

The club’s Board of Directors meets; Brown does not attend. The Board ratifies the sanctions.

Jan 31, 2017

The Board sends a letter to Brown detailing its decision: indefinite suspension, a $2,500 fine, and $5,000 in expense recoupment.

Jun 28, 2017

Brown files a petition with the Arizona Department of Real Estate, alleging a violation of A.R.S. § 33-1803.

Sep 22, 2017

The Office of Administrative Hearings holds a hearing on the matter.

Oct 11, 2017

Administrative Law Judge Tammy L. Eigenheer issues the decision, denying Brown’s petition.

Central Legal Issue: The Definition of “Notice”

The core of the legal dispute was the interpretation of the notice requirement within A.R.S. § 33-1803(B), which states, in part:

“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.”

The Petitioner argued that this statute requires “actual notice,” defined by Black’s Law Dictionary as “[n]otice given directly to, or received personally by, a party.” Because there was no evidence he personally received the December 14, 2016, letter notifying him of the initial hearing, he contended that all subsequent actions by the club were invalid.

The ALJ rejected this interpretation for two primary reasons:

1. Statutory Silence: The governing statute, A.R.S. Title 33, Chapter 16, does not define the term “notice” or specify that it must be “actual notice.”

2. Legal Precedent and Practicality: The ALJ reasoned that requiring actual notice would create an unworkable loophole. A homeowner could “avoid receiving ‘actual notice’ by simply refusing to sign for a certified mailing,” thereby thwarting any disciplinary process.

Instead, the ALJ determined that “constructive notice” was sufficient. Constructive notice is defined as “notice arising by presumption of law from the existence of facts and circumstances that a party had a duty to take notice of.” The Respondent’s actions of sending notice via multiple methods met this standard.

Key Findings and Rulings

The ALJ made several critical findings of fact and conclusions of law that led to the denial of the petition.

• Burden of Proof: The Petitioner, William Brown, bore the burden of proving by a “preponderance of the evidence” that the Respondent violated the statute. The ALJ concluded he failed to meet this burden.

• Finding on Credibility: The ALJ explicitly stated that the Petitioner’s assertion was not credible. The decision notes: “Petitioner’s assertion that the USPS failed to notify him of the certified letter at any time between December 24, 2016, and January 12, 2017, was not credible.”

• Ruling on Constructive Notice: The ALJ concluded that the Petitioner received constructive notice of the January 9, 2017, Infractions Committee meeting through two distinct actions taken by the Respondent:

1. The certified mailing of the December 14, 2016, letter, for which USPS tracking showed an attempted delivery and which the Petitioner was deemed to have refused.

2. The simultaneous first-class mailing of the same letter, which was “presumably delivered to his temporary address in Coldspring, Texas.”

• Notice for Subsequent Meetings: The ALJ further presumed that the first-class mailing of the January 9, 2017, letter—notifying the Petitioner of the Board of Directors meeting—was also delivered, thus satisfying notice requirements for the final decision-making body.

Final Decision and Sanctions

Based on the foregoing analysis, the Administrative Law Judge ordered that the Petitioner’s petition be denied. The ruling affirmed that Terravita Country Club, Inc. did not violate the provisions of A.R.S. § 33-1803(B).

This decision effectively upholds the sanctions imposed by the club’s Board of Directors on January 31, 2017, which include:

• Indefinite suspension of membership privileges.

• A fine of $2,500.00.

• Recoupment of expenses incurred related to the infraction, totaling $5,000.00.

The order is binding on both parties unless a rehearing is granted pursuant to A.R.S. § 32-2199.04.

Briefing: Virden v. Lakeside Ski Village HOA (Case No. 17F-H1717027-REL)

Executive Summary

This briefing document outlines the legal dispute between homeowner Mark Virden (Petitioner) and the Lakeside Ski Village Homeowners Association (Respondent) concerning the construction of an internet service tower on HOA common property. The Petitioner alleged a violation of Arizona’s conflict of interest statute (A.R.S. § 33-1811), asserting that HOA officials received undisclosed compensation—lifelong free internet service—in exchange for approving the tower.

The case culminated in a definitive ruling against the Petitioner. An Administrative Law Judge (ALJ) denied the petition, a decision that was subsequently adopted and finalized by the Commissioner of the Arizona Department of Real Estate. The core of the ruling rested on the HOA’s unique governance structure. The decision to approve the tower was made not by the general “board of directors” (in this HOA, the members act as the board), but by the Architectural Committee, which was vested with independent authority to do so by the HOA’s governing documents (CC&Rs). Consequently, the ALJ concluded that the state law requiring conflict of interest disclosures before the board was not applicable to the committee’s action, rendering the Petitioner’s central argument invalid. The approval of the tower was deemed proper under the HOA’s governing rules.

Case Overview

Entity

Name / Description

Case Number

17F-H1717027-REL

Petitioner

Mark Virden

Respondent

Lakeside Ski Village HOA

Presiding ALJ

Tammy L. Eigenheer

Adjudicating Body

Arizona Office of Administrative Hearings

Final Authority

Commissioner, Arizona Department of Real Estate

Timeline of Key Events

• Circa 2017: The internet company AireBeam approached the HOA to install a service tower but did not secure enough subscribers to fund the project.

• Circa 2017: Lou Talarico, husband of an Architectural Committee member, offered to pay the tower’s upfront cost in exchange for free service for himself and HOA Vice President Carl Rygg. The Architectural Committee subsequently approved construction.

• March 23, 2017: Mark Virden filed a petition with the Arizona Department of Real Estate, alleging a conflict of interest violation.

• June 7, 2017: A hearing was held at the Office of Administrative Hearings.

• June 27, 2017: ALJ Tammy L. Eigenheer issued a decision denying the Petitioner’s petition.

• July 10, 2017: The Commissioner of the Department of Real Estate issued a Final Order adopting the ALJ’s decision.

Petitioner’s Allegations and Arguments

The petition filed by Mark Virden centered on a violation of A.R.S. § 33-1811, which governs contracts and conflicts of interest for HOA boards of directors.

Primary Allegation: Undisclosed Conflict of Interest

The Petitioner alleged that the HOA violated state law by failing to disclose a conflict of interest related to the tower’s approval.

• The Conflict: Susan Talarico, a licensed realtor serving on the Architectural Committee, had a conflict because her husband, Lou Talarico, paid an upfront fee to the tower company. In exchange for this payment, the Talaricos and HOA Vice President Carl Rygg were to receive free internet service for as long as the tower remained operational.

• The Alleged Violation: According to the petition, this arrangement constituted compensation that should have been formally declared in an open meeting before any action was taken, as required by law. The petition states: “This law states that if a member of the board is receiving compensation, and has not declared that conflict in advance, then any contract entered into in violation of this law is void and unenforceable!”

• Perceived Inadequate Compensation: The Petitioner claimed the value of the free service far exceeded the cash contribution, stating, “…their contribution would only pay the equivalent of about 1-2 years of service for the two households.”

• Lack of Transparency: The petition alleges a refusal by the involved board members to provide details of their arrangement. When asked about the compensation, the Vice President reportedly stated, “it’s none of your business.”

Secondary Argument

The Petitioner alternatively argued that the Architectural Committee exceeded its authority. Because the tower could provide service to individuals outside the HOA, it was not exclusively “for the benefit of all or portions” of the HOA, as stipulated by the governing documents.

Personal Grievance

The petition notes a direct personal impact on the Petitioner, stating that the tower was constructed within 150 feet of his front door and that he found it to be “a huge eye sore.”

Respondent’s Governance and Authority

The Lakeside Ski Village HOA’s defense rested on its specific governing documents and organizational structure, which were found to be central to the case’s outcome.

• Unconventional Board Structure: The HOA does not have a traditional, separate board of directors. Its Bylaws stipulate that “The affairs of the Association will be managed by the Members, who by the Association’s Articles of Organization are authorized to exercise all powers normally exercised by a board of directors.”

• Delegated Authority to Architectural Committee: The HOA’s Declaration of Covenants, Conditions, Restrictions and Easements (CC&Rs) grants specific and independent power to its Architectural Committee. The CC&Rs state: “The Architectural Committee may permit one or more aerial satellite dishes or satellite communication systems, and/or other apparatus and equipment for an antenna or cable system for the benefit of all or portions of the Project.”

This structure meant that the authority to approve the tower resided with the committee, not the general membership acting as a board.

Adjudication and Final Ruling

The dispute was adjudicated by the Office of Administrative Hearings, with the final decision adopted by the Department of Real Estate. The Petitioner’s claims were ultimately rejected.

Administrative Law Judge’s Decision

The ALJ’s decision, issued on June 27, 2017, denied the petition based on the following legal rationale:

• Architectural Committee’s Authority Was Dispositive: The ALJ found that the CC&Rs explicitly empowered the Architectural Committee to approve the communication tower. Crucially, the decision established that “Nothing in the CC&Rs requires that the Architectural Committee’s decision must be ratified by the members acting as a board.”

• Conflict of Interest Law Not Applicable: A.R.S. § 33-1811 applies to actions and decisions taken “by or on behalf of the board of directors.” Because the Architectural Committee acted under its own authority granted by the CC&Rs, its decision was not an action of the “board” as defined by the statute.

• Conclusion on Disclosure: The ALJ concluded that even if the free internet service was considered compensation (assuming arguendo), the arrangement “did not have to be disclosed to the members acting as a board.”

• Rejection of Secondary Argument: The ALJ dismissed the argument that the tower did not benefit the HOA, noting that the CC&R language “does not require that the satellite dish or other system may benefit exclusively all or portions of the HOA.”

The final conclusion of the tribunal was that “the Architectural Committee’s approval of the AireBeam tower was proper under Respondent’s governing documents.”

Final Order of the Department of Real Estate

On July 10, 2017, Judy Lowe, Commissioner of the Department of Real Estate, issued a Final Order that formally adopted the ALJ’s decision.

• Outcome: The Petitioner’s petition was officially denied.

• Binding Nature: The Order is binding on the parties and represents a final administrative action.

• Avenues for Appeal: The Order noted that a party may request a rehearing within 30 days for specific causes, such as procedural irregularity, newly discovered evidence, or an arbitrary or capricious decision. Furthermore, a party may appeal the final administrative decision by filing a complaint for judicial review.

Briefing Document: Haderli vs. Carriage Manor RV Resort Association

Executive Summary

This document synthesizes the key findings and legal conclusions from an administrative hearing concerning a dispute between resident Linda Haderli (Petitioner) and the Carriage Manor RV Resort Association, Inc. (Respondent). The core of the dispute was the Association’s decision to remove Ms. Haderli from her position as President of the Pickleball Club and to bar her from holding any club office for 24 months as a disciplinary measure.

The Administrative Law Judge (ALJ) ultimately ruled in favor of Ms. Haderli. The central finding was that the disciplinary action imposed by the Association was in excess of the authority granted by its own governing documents (CC&Rs). While the Association’s rules allowed for remedies such as financial assessments up to $500 or the suspension of common area use rights for violations, they did not provide for the removal of a resident from an elected club office. Consequently, the ALJ ordered that Ms. Haderli be deemed the prevailing party, the Association’s disciplinary action be quashed, and the Association reimburse Ms. Haderli’s $500 filing fee. This decision was formally adopted by the Commissioner of the Arizona Department of Real Estate, making it a final administrative order.

Case Overview

• Parties:

◦ Petitioner: Linda Haderli

◦ Respondent: Carriage Manor RV Resort Association, Inc., a homeowners association in Mesa, Arizona.

• Legal Venue: The Office of Administrative Hearings, State of Arizona.

• Case Number: 17F-H1717029-REL

• Hearing Date: May 30, 2017

• Core Issue: On March 28, 2017, Ms. Haderli filed a petition with the Arizona Department of Real Estate. She alleged that the Association lacked the authority under its governing documents to remove her as President of the Pickleball Club and to prohibit her from serving in any club officer position for two years as a form of discipline.

The Association’s Disciplinary Action and Justification

The Association took disciplinary action against Ms. Haderli and provided three specific reasons for its decision in a formal letter:

1. Challenging Board Policies: The letter accused Ms. Haderli of harassing Association employees and circumventing established systems designed to implement Association policies.

2. Improper Officer Representation: The Association stated that Ms. Haderli had permitted Ms. Joyce Wooton to represent herself as an “Advisor” to the Pickleball Club, a position not recognized as an official Officer position in the Pickleball By-Laws.

3. Unauthorized Representation to External Entities: The Association claimed Ms. Haderli had represented herself to the City of Mesa and SRP (Salt River Project) as having the authority to make decisions on behalf of the Association, which had not been granted by the Board of Directors.

Analysis of Allegations and Testimony

During the May 30, 2017 hearing, testimony was presented by both parties regarding the three justifications for the disciplinary action.

Allegation 1: Harassment of an Association Employee

• Respondent’s Testimony (Mary Candelaria, General Manager): Ms. Candelaria testified that on January 4, 2017, Ms. Haderli had a “contentious interaction” with an employee, Barb Putnam. According to some observers, Ms. Haderli was yelling. The following day, Ms. Putnam was hospitalized with a hemorrhage in her eye. Ms. Candelaria “theorized” that the stress from the encounter caused the medical issue. She collected written statements from observers but did not speak with Ms. Haderli about the incident, citing confidentiality concerns.

• Petitioner’s Testimony (Linda Haderli): Ms. Haderli denied yelling at Ms. Putnam, explaining that her hearing loss sometimes causes her to speak louder than intended, which can be misinterpreted as yelling. She stated she was attempting to reserve dates for Pickleball Club fundraising events and that Ms. Putnam was uncooperative. Ms. Haderli testified she was unaware of the harassment accusation until reviewing exhibits for the hearing with her attorney.

Allegation 2: Improper Officer Representation (Joyce Wooton)

• Petitioner’s Testimony (Linda Haderli): Ms. Haderli testified that Ms. Wooton was already serving as an advisor to the Pickleball Club when Ms. Haderli was elected Vice President, a full year before she became President on March 1, 2016.

Allegation 3: Unauthorized Representation to External Entities

• Respondent’s Testimony (Mary Candelaria, General Manager): Ms. Candelaria stated that while the Pickleball Club was exploring a project to build a small structure, Ms. Haderli contacted the City of Mesa and SRP directly, representing herself as acting on behalf of the Association. This continued even after Ms. Haderli was advised to work through the project’s architect for technical questions.

• Petitioner’s Testimony (Linda Haderli): Ms. Haderli denied representing herself as having authority to act for the Association. She testified that her intent was merely to gather background information to be better informed about the project. She initially did not want to provide her name or address to the entities for fear of appearing to act in an official capacity, only providing the address when required because regulations differ by city area.

Governing Documents and Permitted Remedies

The Administrative Law Judge’s decision hinged on the specific remedies available to the Association as outlined in its governing documents, the CC&Rs. The Association clarified that the discipline was imposed on Ms. Haderli in her capacity as a resident who violated community rules, not as a disciplinary action against the Pickleball Club itself.

The following sections of the CC&Rs were cited as relevant:

CC&R Section

Description

Authorized Remedy

Section 14.2

Employee Abuse: Prohibits physical or verbal harassment of employees by residents.

Enforcement as an “Other Violation” under Section 15.2B.

Section 15.2B

Other Violations: Stipulates that such violations are subject to a financial penalty.

An assessment set by the Board of Directors, not to exceed $500.00.

Section 12.2

Suspension of Rights: Grants the Association the right to suspend an Owner’s rights for infractions.

Suspension of an Owner’s voting rights and Common Areas use rights.

Legal Conclusions and Final Ruling

The Administrative Law Judge reached several key conclusions of law that led to the final order.

• Burden of Proof: The petitioner, Linda Haderli, bore the burden of proving by a preponderance of the evidence that the Association acted without the authority granted by its governing documents.

• Excess of Authority: The Respondent (the Association) “did not establish that removal as the Pickleball Club President and/or a prohibition of holding any other officer position for a period of 24 months is a remedy available under the governing documents.”

• Final Conclusion: The Tribunal concluded that the Board of Directors’ decision to impose this specific discipline was in excess of its authority.

Recommended and Final Order

Based on these conclusions, Administrative Law Judge Tammy L. Eigenheer issued a recommended order on June 18, 2017:

1. Petitioner Deemed Prevailing Party: Linda Haderli was declared the prevailing party in the matter.

2. Discipline Quashed: The disciplinary action imposed by the Association against Ms. Haderli was ordered to be quashed.

3. Filing Fee Reimbursement: The Association was ordered to pay Ms. Haderli her $500.00 filing fee within thirty days.

On June 21, 2017, Judy Lowe, the Commissioner of the Arizona Department of Real Estate, issued a Final Order adopting the Administrative Law Judge’s decision in its entirety. This order became a final administrative action, effective immediately.

Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA

Executive Summary

This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.

The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.

Case Overview

This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.

Affiliation

Petitioner

Barry Saxion

Petitioner

Sandra Saxion

Property owner within the Association

Respondent

Silverton II Homeowners Association, Inc.

Adjudicator

Tammy L. Eigenheer

Administrative Law Judge, Office of Administrative Hearings

Final Authority

Judy Lowe

Commissioner, Arizona Department of Real Estate

Respondent’s Counsel

Troy B. Stratman, Esq.

Stratman Law Firm, PLC

Identifier

Case Number

HO 17-16/023

Docket Number

17F-H1716023-REL

Jurisdiction

Office of Administrative Hearings (OAH), Phoenix, Arizona

Referring Body

Arizona Department of Real Estate (Department)

• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.

• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.

• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.

• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.

• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.

• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.

Analysis of the Motion for Summary Judgment

The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.

Respondent’s Arguments

1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.

2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”

Administrative Law Judge’s Decision

The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.

• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.

• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.

• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.

• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.

• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.

• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”

• The judge found that the current dispute fell squarely within this definition.

• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”

• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.

Final Disposition and Subsequent Actions

The ALJ’s recommendation to dismiss directly led to the final resolution of the case.

Vacating of Hearing

A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.

Final Order from the Department of Real Estate

On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.

• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”

• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.

• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.

Official Communications

The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:

• Barry Saxion

• Troy B. Stratman, Esq. (counsel for the HOA)

• The Office of Administrative Hearings

• Judy Lowe and other staff at the Arizona Department of Real Estate

Briefing Document: DeBoer vs. Turtle Rock III Homeowners Association

Executive Summary

This document summarizes the findings and outcome of the legal dispute between homeowner Richard A. DeBoer and the Turtle Rock III Homeowners Association (HOA). The central issue was the HOA Board of Directors’ practice of conducting votes on non-emergency matters via email, which the petitioner alleged violated Arizona’s open meeting laws.

An Administrative Law Judge (ALJ) for the State of Arizona concluded that the HOA Board did violate state law (A.R.S. § 33-1804) by using email to approve the purchase of new street lights and the removal of existing fixtures, thereby circumventing requirements for open meetings accessible to all members. The Board’s defense, that it had relied on poor advice from its management company, was not sufficient to overcome the violation.

Consequently, Mr. DeBoer was declared the prevailing party. The HOA was ordered to cease this practice, pay a $1,000 civil penalty to the Arizona Department of Real Estate, and reimburse Mr. DeBoer for his $500 filing fee. The ALJ’s decision was formally adopted by the Commissioner of the Department of Real Estate, making it a final administrative order.

Case Background

• Case Name: Richard A. DeBoer vs. Turtle Rock III Homeowners Association

• Case Numbers: 17F-H1616006-REL (Office of Administrative Hearings), HO17-16/006 (Department of Real Estate)

• Jurisdiction: The dispute was filed with the Arizona Department of Real Estate and heard by the Office of Administrative Hearings.

• Petitioner: Richard A. DeBoer, a homeowner.

• Respondent: Turtle Rock III Homeowners Association, located in Phoenix, Arizona.

Key Dates

August 23, 2016

Petition filed by Richard A. DeBoer.

December 19, 2016

Hearing held before the Office of Administrative Hearings.

January 9, 2017

Administrative Law Judge Decision issued.

January 12, 2017

Final Order issued by the Department of Real Estate Commissioner.

January 13, 2017

Compliance letter sent to the HOA by the Department of Real Estate.

February 11, 2017

Deadline for HOA to show proof of payment for petitioner’s filing fee.

March 13, 2017

Deadline for HOA to pay the civil penalty.

Petitioner’s Allegations

Richard A. DeBoer’s petition, filed on August 23, 2016, alleged that the Turtle Rock III HOA Board of Directors had a “common practice” of conducting unnoticed email meetings to vote on non-emergency matters. This practice was alleged to be in violation of both Arizona state law and the HOA’s own bylaws.

• March 2016: The Board conducted an email vote to approve the purchase and installation of four high-mast street lights in the common area.

• April 2016: The Board conducted an email vote to approve the removal and sale or disposal of fourteen large, iconic, architectural light fixtures from the common areas.

• The email meetings were not open to all association members.

• Members were denied the opportunity to attend and speak before the Board took formal action.

• The subject matter did not meet the criteria for a closed meeting.

• The Board failed to provide members with at least 48 hours’ advance notice.

• The meetings did not qualify as emergency meetings.

• Proper notices and agendas containing information “reasonably necessary to inform the members” were not provided.

• The petitioner alleged the actions were contrary to Turtle Rock III Bylaws, Division VI, Item 2.i, which incorporates Robert’s Rules of Order.

• Specifically, the email meetings were conducted without authorization in the bylaws and failed to provide for “a single official gathering in one room or area.”

• The format lacked the required “conditions of opportunity for simultaneous aural communication among participating members.”

Respondent’s Defense and Testimony

The Turtle Rock III HOA initially filed an answer denying all allegations made in the petition.

During the hearing on December 19, 2016, the following testimony was provided on behalf of the HOA:

• Verl Curtiss (Board President) and Steve Pilcher (Board Treasurer) both acknowledged that the email votes regarding the lighting had occurred.

• Their defense centered on the claim that they had been advised by their management company and manager that their actions were not in violation of Arizona statutes or the HOA’s bylaws.

• Mr. Pilcher testified that they believed they had received “good advice.”

Legal Findings and Conclusion

The Administrative Law Judge (ALJ), Tammy L. Eigenheer, determined that the petitioner bore the burden of proving the violation by a “preponderance of the evidence.”

The decision focused on A.R.S. § 33-1804(A), which states:

“Notwithstanding any provision in the declaration, bylaws or other documents to the contrary, all meetings of the members’ association and the board of directors… are open to all members of the association… and all members or designated representatives so desiring shall be permitted to attend and speak at an appropriate time during the deliberations and proceedings.”

Based on the evidence and testimony, including the Board’s admission that email votes took place, the ALJ issued a clear conclusion:

“This Tribunal concludes that the Board’s prior practice of taking action in the absence of a meeting by obtaining unanimous written consent of the Board’s members via email violated the charged provisions of A.R.S. § 33-1804(A).”

Final Order and Penalties

The ALJ’s Recommended Order was officially accepted and adopted as a Final Order by Judy Lowe, the Commissioner of the Arizona Department of Real Estate, on January 12, 2017. The HOA was ordered to undertake the following actions:

1. Cease and Desist: The Respondent must comply with all applicable provisions of A.R.S. § 33-1804(A) in the future.

2. Fee Reimbursement: The Respondent must pay the Petitioner, Richard A. DeBoer, his filing fee of $500.00 within thirty (30) days of the Order.

3. Civil Penalty: The Respondent must pay a civil penalty of $1,000.00 to the Department of Real Estate within sixty (60) days of the Order.

The Final Order constituted a final administrative action, subject to appeal or a motion for rehearing within 30 days.

Key Parties and Officials

Name/Entity

Richard A. DeBoer

Petitioner / Homeowner

Turtle Rock III Homeowners Association

Respondent

Verl Curtiss

President, Respondent’s Board of Directors

Steve Pilcher

Treasurer, Respondent’s Board of Directors

Goodman Law Group

Respondent’s Representative

Tammy L. Eigenheer

Administrative Law Judge

Office of Administrative Hearings

Adjudicating Body

Arizona Department of Real Estate

Regulatory Agency / Jurisdiction for HOA Disputes

Judy Lowe

Commissioner, Department of Real Estate

Abby Hansen

HOA Dispute Coordinator, Department of Real Estate