Victor L Pattarozzi v. Estrella Vista Homeowners Association

Posted on June 5, 2019 by [email protected]

Case Summary

Case ID	19F-H1919047-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2019-06-05
Administrative Law Judge	Thomas Shedden
Outcome	The Administrative Law Judge dismissed the petition, ruling that the Architectural Committee meetings of the HOA were not 'regularly scheduled' within the meaning of ARIZ. REV. STAT. § 33-1804, and therefore the HOA was not required to hold them open to association members.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Victor L Pattarozzi	Counsel	—
Respondent	Estrella Vista Homeowners Association	Counsel	Andrew Apodaca, Esq.

Alleged Violations

ARIZ. REV. STAT. § 33-1804

Outcome Summary

The Administrative Law Judge dismissed the petition, ruling that the Architectural Committee meetings of the HOA were not 'regularly scheduled' within the meaning of ARIZ. REV. STAT. § 33-1804, and therefore the HOA was not required to hold them open to association members.

Why this result: The petitioner failed to prove that the committee meetings met the requirement of being 'regularly scheduled' because the committee did not meet at fixed or uniform intervals, but rather considered applications as they were received.

Key Issues & Findings

Whether the Architectural Committee meetings are 'regularly scheduled' and thus required to be open to members.

Petitioner alleged the HOA violated ARS 33-1804 by failing to hold open meetings of its Architectural Committee (ARC). The ALJ found that because the ARC did not meet on a set schedule or at uniform intervals, it did not hold 'regularly scheduled' meetings as required by the statute, and thus was not required to be open.

Orders: Petitioner's petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

ARIZ. REV. STAT. § 33-1804
ARIZ. REV. STAT. § 33-1805
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968)
U.S. Parking v. City of Phoenix, 160 Ariz. 210, 772 P.2d 33 (App. 1989)
Deer Valley, v. Houser, 214 Ariz. 293, 296, 152 P.3d 490, 493 (2007)

Analytics Highlights

Topics: HOA Open Meetings, Architectural Review Committee, Statutory Interpretation, Regularly Scheduled

Additional Citations:

ARIZ. REV. STAT. § 33-1804
ARIZ. REV. STAT. § 33-1805
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968)
U.S. Parking v. City of Phoenix, 160 Ariz. 210, 772 P.2d 33 (App. 1989)
Deer Valley, v. Houser, 214 Ariz. 293, 296, 152 P.3d 490, 493 (2007)

Video Overview

Audio Overview

Decision Documents

19F-H1919047-REL Decision – 713039.pdf

Uploaded 2026-04-24T11:19:09 (89.8 KB)

Briefing Document: Pattarozzi vs. Estrella Vista Homeowners Association (Case No. 19F-H1919047-REL)

Executive Summary

This document provides an analysis of the Administrative Law Judge Decision in the matter of Victor L. Pattarozzi vs. Estrella Vista Homeowners Association, Case No. 19F-H1919047-REL. The central issue was whether the homeowner association’s Architectural Review Committee (ARC) was in violation of Arizona state law by not holding open meetings for its members.

The petition, brought by Mr. Pattarozzi, was ultimately dismissed. The Administrative Law Judge, Thomas Shedden, concluded that the Petitioner failed to prove that the Respondent violated ARIZ. REV. STAT. § 33-1804. The decision hinged on the interpretation of the phrase “regularly scheduled committee meetings.” The Judge found that since the ARC did not meet at fixed, uniform, or recurring intervals, but rather on an as-needed basis to review applications, its meetings were not “regularly scheduled” within the meaning of the statute. Consequently, the legal requirement for such meetings to be open to all association members did not apply. The Judge further determined that the state’s declared policy in favor of open meetings explicitly referenced only the association’s and board of directors’ meetings, not committee meetings, and therefore could not be used to compel the ARC meetings to be open.

Case Overview

Case Number

19F-H1919047-REL

Petitioner

Victor L. Pattarozzi

Respondent

Estrella Vista Homeowners Association

Presiding Judge

Thomas Shedden, Administrative Law Judge

Hearing Date

May 16, 2019

Decision Date

June 5, 2019

Jurisdiction

Office of Administrative Hearings, Arizona Department of Real Estate

Allegation: The Petitioner, Victor L. Pattarozzi, alleged that the Estrella Vista Homeowners Association violated ARIZ. REV. STAT. § 33-1804 by failing to hold open meetings for its Architectural Committee (referred to as the Architectural Review Committee or ARC).

Defense: The Respondent association contended that its ARC meetings were not required to be open to members because the meetings were not “regularly scheduled.”

Central Legal Issue: The Definition of “Regularly Scheduled”

The case revolved entirely around the interpretation of a key phrase within Arizona’s planned community statutes.

Governing Statute: ARIZ. REV. STAT. § 33-1804(A) 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, and any regularly scheduled committee meetings, are open to all members of the association….”

The core legal question was whether the ARC’s method of conducting business constituted “regularly scheduled” meetings.

Competing Arguments

• Petitioner’s Position (Mr. Pattarozzi):

◦ Mr. Pattarozzi argued that the association could hold weekly ARC meetings and simply cancel them if no applications were pending for review.

◦ He supplied dictionary definitions for “regular” and “regularly” to support his interpretation:

▪ Regularly: (1) “in a regular manner”; (2) “on a regular basis: at regular intervals”.

▪ Regular: (1) “constituted, conducted, scheduled, or done in conformity with established or prescribed usages, rules, or discipline”; (2) “recurring, attending, or functioning at fixed, uniform, or normal intervals”.

◦ He also contended that the state’s declared policy in favor of open meetings, as outlined in subsection 33-1804(F), should be broadly construed to require ARC meetings to be open.

• Respondent’s Position (Estrella Vista HOA):

◦ The association maintained that its ARC meetings were not required to be open because they do not occur on a set schedule. Instead, they are convened only as needed when applications are received.

Findings of Fact

The decision outlined the specific operational procedures of the Architectural Review Committee.

• Composition and Process: The ARC consists of five members. It does not meet on a predetermined schedule. Instead, applications are forwarded by the management company to the Board President, Stuart Glenn.

• “Rubber Stamp” Approvals: The ARC has a pre-approved “rubber stamp” process for certain requests, such as solar panel installations and repainting with a pre-approved color. These requests are approved without further review by the full committee.

• Application Volume: As of the May 16, 2019 hearing, the ARC had received twelve applications in 2019. Of these, eight were subject to the “rubber stamp” approval process.

• Non-Standard Applications: For any application not meeting the rubber-stamp criteria, Mr. Glenn forwards it to the other four ARC members, who individually report back on their approval or disapproval.

Legal Reasoning and Decision

The Administrative Law Judge’s conclusions of law provided a detailed statutory interpretation that led to the dismissal of the petition.

Interpretation of “Regularly Scheduled”

The Judge determined that the legislature intentionally distinguished between different types of meetings. While the law mandates that all meetings of the members’ association and the board of directors must be open, it applies a specific qualifier—”regularly scheduled”—to committee meetings. This implies that not all committee meetings must be open.

The Judge adopted the Petitioner’s second definition of “regular”: “recurring, attending, or functioning at fixed, uniform, or normal intervals.” This interpretation was deemed to provide a fair and sensible result.

The Judge explicitly rejected the Petitioner’s first definition—”done in conformity with established or prescribed usages, rules, or discipline”—on the grounds that it would render the word “regular” redundant. The Judge reasoned that all committee meetings are presumed to be conducted according to established rules, so applying this definition would make the statutory language trivial.

Rejection of the “Open Meeting Policy” Argument

The Petitioner argued that subsection 33-1804(F), which declares a state policy in favor of open meetings, should apply. The Judge rejected this argument based on the specific text of the statute:

“It is the policy of this state as reflected in this section that all meetings of a planned community, whether meetings of the members’ association or meetings of the board of directors of the association, be conducted openly ….”

The Judge noted that this policy statement explicitly references only meetings of the “members’ association” and the “board of directors,” and omits any mention of committee meetings. Therefore, the policy could not be used to compel the ARC meetings to be open.

Final Order

Ruling: IT IS ORDERED that Victor L. Pattarozzi’s petition is dismissed.

Justification: The Petitioner, who bore the burden of proof, did not establish by a preponderance of the evidence that the Estrella Vista Homeowners Association violated ARIZ. REV. STAT. § 33-1804. The Judge concluded that the ARC “does not hold ‘regularly scheduled’ meetings within the meaning of” the statute.

Next Steps: The decision is binding unless a party files a request for rehearing with the Commissioner of the Department of Real Estate within 30 days of the service of the Order.

Study Guide: Pattarozzi v. Estrella Vista Homeowners Association

This study guide provides a comprehensive review of the Administrative Law Judge Decision in case number 19F-H1919047-REL, concerning a dispute between Victor L. Pattarozzi and the Estrella Vista Homeowners Association. The guide includes a quiz with an answer key, a set of essay questions for deeper analysis, and a glossary of key terms found within the legal decision.

Quiz: Short-Answer Questions

Answer the following questions in 2-3 complete sentences, based on the information provided in the source document.

1. Who were the primary parties involved in this case, and what were their respective roles?

2. What specific violation did Petitioner Victor L. Pattarozzi allege against the Respondent, the Estrella Vista Homeowners Association?

3. What was the central argument made by the Estrella Vista Homeowners Association to defend its Architectural Review Committee’s meeting practices?

4. Describe the composition of the Architectural Review Committee (ARC) and its method for reviewing applications.

5. What was the “rubber stamp” process used by the ARC, and how many of the 12 applications received in 2019 were approved this way?

6. What suggestion did Mr. Pattarozzi offer for how the ARC could schedule its meetings to comply with his interpretation of the statute?

7. Which of Mr. Pattarozzi’s proposed definitions for the word “regular” did the Administrative Law Judge ultimately accept as the most appropriate interpretation in this context?

8. According to the judge’s Conclusions of Law, why was Mr. Pattarozzi’s argument regarding the open meetings policy statement in subsection 33-1804(F) rejected?

9. Who bears the burden of proof in this matter, and what is the required standard of proof?

10. What was the final Order issued by the Administrative Law Judge in this case, and on what date was it issued?

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Answer Key

1. The primary parties were the Petitioner, Victor L. Pattarozzi, who brought the complaint, and the Respondent, the Estrella Vista Homeowners Association, which was defending its actions. Mr. Pattarozzi appeared on his own behalf, while the HOA was represented by Andrew Apodaca, Esq. and its Board president, Stuart Glenn.

2. Mr. Pattarozzi alleged that the Estrella Vista Homeowners Association violated ARIZ. REV. STAT. sections 33-1804 and 33-1805. His specific claim was that the HOA’s Architectural Review Committee (ARC) was failing to hold open meetings as required by section 33-1804.

3. The HOA’s position was that its ARC meetings were not required to be open to all members because the meetings were not “regularly scheduled.” The statute only mandates that “regularly scheduled committee meetings” must be open.

4. The ARC consists of five members and does not meet on a set schedule, instead considering applications as they are received. The Board president, Mr. Glenn, receives applications, determines if they meet “rubber-stamp” criteria, and if not, forwards them to the other four members for their agreement or disagreement.

5. The “rubber stamp” process was a pre-approved method for approving requests for solar panels and repainting using preapproved colors without further review. Of the twelve applications received by the ARC in 2019, eight were subject to this rubber-stamp approval.

6. Mr. Pattarozzi argued that the Respondent could schedule ARC meetings on a weekly basis. If there were no applications pending for a given week, the HOA could simply cancel the meeting.

7. The judge accepted Mr. Pattarozzi’s second definition of “regular,” which was “recurring, attending, or functioning at fixed, uniform, or normal intervals.” The judge concluded this meant only committee meetings scheduled on a recurring basis at uniform intervals must be open.

8. The argument was rejected because the policy statement in subsection 33-1804(F) explicitly references only the “meetings of the members’ association or meetings of the board of directors.” Because committee meetings were not mentioned in that specific subsection, the judge ruled that its strong policy in favor of open meetings did not apply to them.

9. The Petitioner, Mr. Pattarozzi, bears the burden of proof. The standard of proof required to decide all issues in the matter is a “preponderance of the evidence.”

10. The final Order was that Victor L. Pattarozzi’s petition be dismissed. This Order was issued on June 5, 2019.

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Essay Questions

1. Analyze the Administrative Law Judge’s interpretation of ARIZ. REV. STAT. section 33-1804. Discuss how the judge used principles of statutory interpretation, such as giving meaning to every word and considering legislative intent, to differentiate between board meetings and committee meetings.

2. Evaluate the strength of Victor L. Pattarozzi’s case. What were his key arguments, including his use of dictionary definitions and the policy statement in subsection 33-1804(F), and why did the judge ultimately find them unconvincing?

3. Discuss the concept of “preponderance of the evidence” as defined in the decision. Explain how this standard of proof applied to Mr. Pattarozzi’s petition and why he failed to meet it.

4. Examine the operational procedures of the Architectural Review Committee (ARC). How did the “rubber stamp” process and the ad-hoc nature of their meetings support the Respondent’s position that the meetings were not “regularly scheduled”?

5. Based on the judge’s reasoning, what specific changes would the Estrella Vista Homeowners Association’s Architectural Committee need to make for its meetings to be considered “regularly scheduled” and therefore required to be open to all members under Arizona law?

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Glossary of Key Terms

Definition

Administrative Law Judge

An official, in this case Thomas Shedden, who presides over administrative hearings, weighs evidence, and makes legal decisions and orders.

Architectural Review Committee (ARC)

A committee of the Estrella Vista Homeowners Association, consisting of five members, responsible for reviewing and approving member applications for things like solar panels and house painting.

ARIZ. ADMIN. CODE

The Arizona Administrative Code, a set of state regulations. In this case, § R2-19-119 established the standard of proof.

ARIZ. REV. STAT.

Arizona Revised Statutes, the laws enacted by the Arizona state legislature. Sections 33-1804 and 33-1805 were the statutes central to this case.

Burden of Proof

The obligation to prove one’s assertion. In this matter, the burden of proof was on the Petitioner, Mr. Pattarozzi.

Department of Real Estate

The Arizona state agency with legal authority over this matter, which issued the initial Notice of Hearing.

Dismissed

The legal term for the final Order in this case, meaning the Petitioner’s petition was rejected and no action was taken against the Respondent.

Office of Administrative Hearings

The venue where the hearing for this case was held on May 16, 2019.

Petitioner

The party who files a petition or brings a legal action against another. In this case, Victor L. Pattarozzi.

Preponderance of the Evidence

The standard of proof required in this case, defined as “The greater weight of the evidence…sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Respondent

The party against whom a petition is filed or an action is brought. In this case, the Estrella Vista Homeowners Association.

Statutory Interpretation

The process by which judges interpret and apply legislation. The decision outlines several principles, such as giving words their ordinary meanings and ensuring no part of a statute is redundant.

Briefing Document: Pattarozzi vs. Estrella Vista Homeowners Association (Case No. 19F-H1919047-REL)

Executive Summary

Case Overview

Case Number

19F-H1919047-REL

Petitioner

Victor L. Pattarozzi

Respondent

Estrella Vista Homeowners Association

Presiding Judge

Thomas Shedden, Administrative Law Judge

Hearing Date

May 16, 2019

Decision Date

June 5, 2019

Jurisdiction

Office of Administrative Hearings, Arizona Department of Real Estate

Defense: The Respondent association contended that its ARC meetings were not required to be open to members because the meetings were not “regularly scheduled.”

Central Legal Issue: The Definition of “Regularly Scheduled”

The case revolved entirely around the interpretation of a key phrase within Arizona’s planned community statutes.

Governing Statute: ARIZ. REV. STAT. § 33-1804(A) states:

The core legal question was whether the ARC’s method of conducting business constituted “regularly scheduled” meetings.

Competing Arguments

• Petitioner’s Position (Mr. Pattarozzi):

◦ Mr. Pattarozzi argued that the association could hold weekly ARC meetings and simply cancel them if no applications were pending for review.

◦ He supplied dictionary definitions for “regular” and “regularly” to support his interpretation:

▪ Regularly: (1) “in a regular manner”; (2) “on a regular basis: at regular intervals”.

◦ He also contended that the state’s declared policy in favor of open meetings, as outlined in subsection 33-1804(F), should be broadly construed to require ARC meetings to be open.

• Respondent’s Position (Estrella Vista HOA):

Findings of Fact

The decision outlined the specific operational procedures of the Architectural Review Committee.

• Application Volume: As of the May 16, 2019 hearing, the ARC had received twelve applications in 2019. Of these, eight were subject to the “rubber stamp” approval process.

Legal Reasoning and Decision

The Administrative Law Judge’s conclusions of law provided a detailed statutory interpretation that led to the dismissal of the petition.

Interpretation of “Regularly Scheduled”

Rejection of the “Open Meeting Policy” Argument

The Petitioner argued that subsection 33-1804(F), which declares a state policy in favor of open meetings, should apply. The Judge rejected this argument based on the specific text of the statute:

Final Order

Ruling: IT IS ORDERED that Victor L. Pattarozzi’s petition is dismissed.

Next Steps: The decision is binding unless a party files a request for rehearing with the Commissioner of the Department of Real Estate within 30 days of the service of the Order.

Case Participants

Petitioner Side

Victor L Pattarozzi (petitioner)
Appeared and testified on his own behalf

Respondent Side

Andrew Apodaca (attorney)
Goering, Roberts, Rubin, Brogna, Enos & Treadwell-Rubin, P.C.
Attorney for Respondent Estrella Vista Homeowners Association
Stuart Glenn (board member)
Estrella Vista Homeowners Association
Board president who presented testimony for Respondent

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
Recipient of transmittal
Felicia Del Sol (Administrative Staff)
Listed in the final section of the document

Brad W. Stevens vs. Mogollon Airpark, Inc.

Posted on March 1, 2019 by [email protected]

Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.

Case Summary

Case ID	18F-H1818029-REL-RHG, 18F-H1818045-REL, 18F-H1818054-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-18
Administrative Law Judge	Thomas Shedden
Outcome	The Administrative Law Judge ruled partially in favor of Petitioner Warren R. Brown, finding that Mogollon Airpark, Inc. violated ARIZ. REV. STAT. section 33-1803(A) by imposing a $25 late payment fee, and ordered the fee rescinded and the $500 filing fee refunded,,,. The ALJ ruled against both Petitioners (Brown and Stevens) regarding the challenge to the $325 assessment increase, dismissing those petitions because they failed to prove the HOA violated A.R.S. § 33-1803(A),,,.
Filing Fees Refunded	$1,500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Warren R. Brown	Counsel	—
Respondent	Mogollon Airpark, Inc.	Counsel	Gregory A. Stein, Esq.; Mark K. Sahl, Esq.

Alleged Violations

ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)

Outcome Summary

The Administrative Law Judge ruled partially in favor of Petitioner Warren R. Brown, finding that Mogollon Airpark, Inc. violated ARIZ. REV. STAT. section 33-1803(A) by imposing a $25 late payment fee, and ordered the fee rescinded and the $500 filing fee refunded,,,. The ALJ ruled against both Petitioners (Brown and Stevens) regarding the challenge to the $325 assessment increase, dismissing those petitions because they failed to prove the HOA violated A.R.S. § 33-1803(A),,,.

Why this result: Petitioners Warren R. Brown and Brad W. Stevens failed to prove by a preponderance of the evidence that the combined $325 assessment increase violated ARIZ. REV. STAT. section 33-1803(A) because their definition of 'regular assessment' as encompassing all assessments enacted through proper procedures was not supported by statutory construction principles,.

Key Issues & Findings

Challenge to assessment increase exceeding 20% limit (Brown Docket 18F-H1818029-REL-RHG)

Petitioner Brown alleged the combined $325 increase, consisting of a $116 regular increase and a $209 special assessment, violated A.R.S. § 33-1803(A) because 'regular assessment' refers to the creation process, making the total increase subject to the 20% cap,,,,.

Orders: Petition dismissed. Respondent Mogollon Airpark, Inc. deemed the prevailing party in the 029 matter,,,.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Cited:

Challenge to assessment increase exceeding 20% limit (Stevens Docket 18F-H1818054-REL)

Petitioner Stevens alleged the total $325 assessment increase violated A.R.S. § 33-1803(A) and raised accompanying allegations of deceptive accounting and lack of authority to impose special assessments,,.

Orders: Petition dismissed. Respondent deemed the prevailing party in the 054 matter,,,,.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Cited:

Challenge to late payment charges (Brown Docket 18F-H1818045-REL)

Petitioner Brown alleged that the $25 late fee and 18% interest charged by Mogollon violated the statutory limits set forth in A.R.S. § 33-1803(A),,. The ALJ found the $25 late charge violated the statute because the limit applies to all 'assessments',.

Orders: Petitioner Warren R. Brown deemed the prevailing party. Mogollon Airpark Inc. must rescind the $25 late fee and pay Mr. Brown his filing fee of $500.00 within thirty days,.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

Analytics Highlights

Topics: HOA assessment cap, Late fee violation, Statutory construction, Regular assessment definition, Special assessment, Filing fee refund

Additional Citations:

ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Deer Valley, v. Houser, 214 Ariz. 293, 296, 152 P.3d 490, 493 (2007)
U.S. Parking Sys v. City of Phoenix, 160 Ariz. 210, 211, 772 P.2d 33, 34 (App. 1989)

Video Overview

Audio Overview

Decision Documents

18F-H1818054-REL-RHG Decision – 692388.pdf

Uploaded 2026-04-24T11:14:31 (102.8 KB)

18F-H1818054-REL-RHG Decision – 666285.pdf

Uploaded 2026-04-24T11:14:35 (151.9 KB)

18F-H1818054-REL-RHG Decision – 672623.pdf

Uploaded 2026-04-24T11:14:39 (144.6 KB)

Briefing Document: Brown and Stevens vs. Mogollon Airpark, Inc.

Executive Summary

This document synthesizes the findings and conclusions from a consolidated administrative law case involving petitioners Warren R. Brown and Brad W. Stevens against their homeowners’ association (HOA), Mogollon Airpark, Inc. The central dispute concerned a 2018 assessment increase of $325, which represented a 39.4% increase over the previous year, and the imposition of a new $25 late fee.

The petitioners argued that the entire assessment increase violated Arizona Revised Statute § 33-1803(A), which limits annual regular assessment increases to 20%. They contended that the term “regular” describes the procedural enactment of an assessment, making the entire 325increaseasingleregularassessment.Conversely,theHOAassertedthatithadbifurcatedtheincreaseintoacompliant14.1116) regular assessment increase and a separate $209 special assessment, which is not subject to the 20% statutory cap.

The Administrative Law Judge (ALJ) ultimately sided with Mogollon Airpark on the assessment increase, dismissing the petitions of both Mr. Brown and Mr. Stevens. The ALJ’s rationale, based on principles of statutory construction, was that “regular assessment” refers to a type of assessment, distinct from a “special assessment,” and that to rule otherwise would render the word “regular” meaningless in the statute. A subsequent rehearing requested by Mr. Stevens was also denied on the same grounds.

However, the ALJ ruled in favor of Mr. Brown on the matter of the late fee. The decision found that the statutory limit on late fees applies to all “assessments,” not just regular ones, making the HOA’s $25 fee a clear violation. Underlying the legal challenges were substantial allegations by the petitioners of deceptive accounting and financial mismanagement by the HOA to create a “fabricated shortfall,” though the ALJ noted these issues were outside the narrow scope of the administrative hearing and better suited for civil court.

Case Overview and Parties Involved

This matter consolidates three separate petitions filed with the Arizona Department of Real Estate, which were heard by the Office of Administrative Hearings.

• Petitioners:

◦ Warren R. Brown (Docket Nos. 18F-H1818029-REL-RHG & 18F-H1818045-REL)

◦ Brad W. Stevens (Docket No. 18F-H1818054-REL)

• Respondent:

◦ Mogollon Airpark, Inc.

• Venue and Adjudication:

◦ Tribunal: Office of Administrative Hearings, Phoenix, Arizona

◦ Administrative Law Judge: Thomas Shedden

◦ Hearing Date (Consolidated Matters): September 28, 2018

◦ Rehearing Date (Stevens Matter): February 11, 2019

Key Financial Figures

Amount/Rate

Calculation/Note

Previous Year’s Assessment (2017)

The baseline for calculating the increase percentage.

Total 2018 Assessment Increase

The total amount disputed by the petitioners.

Total Increase Percentage

($325 / $825)

“Regular Assessment” Increase

As classified by Mogollon Airpark, Inc. (14.1% increase).

“Special Assessment”

As classified by Mogollon Airpark, Inc.

New Late Fee

Challenged as exceeding statutory limits.

New Interest Rate

For past-due accounts.

Statutory Late Fee Limit

Greater of $15 or 10%

Per ARIZ. REV. STAT. § 33-1803(A).

Statutory Assessment Increase Limit

20% over prior year

Per ARIZ. REV. STAT. § 33-1803(A), applies to regular assessments.

Analysis of Core Legal Disputes

The hearings focused on two primary violations of Arizona statute alleged by the petitioners.

The 2018 Assessment Increase (39.4%)

The crux of the case in dockets 029 and 054 was the interpretation of the term “regular assessment” within ARIZ. REV. STAT. § 33-1803(A).

• Petitioners’ Position (Brown & Stevens):

◦ The total $325 increase, constituting a 39.4% hike, is a clear violation of the 20% statutory cap.

◦ The term “regular assessment” as used in the statute refers to the process by which an assessment is created (i.e., by motion, second, and vote). As the entire $325 was passed via this standard procedure, it constitutes a single regular assessment.

◦ They further argued that Mogollon Airpark, Inc.’s governing documents (Bylaws and CC&Rs) do not provide any explicit authority to impose “special assessments,” meaning any assessment levied must be a regular one.

• Respondent’s Position (Mogollon Airpark, Inc.):

◦ The assessment was properly bifurcated into two distinct parts: a $116 increase to the regular assessment (a 14.1% increase, well within the 20% limit) and a $209 special assessment.

◦ “Regular assessment” and “special assessment” are established terms of art in the HOA industry, denoting different types of assessments, not the process of their creation.

◦ The existence of both terms in other parts of Arizona law, such as § 33-1806, demonstrates the legislature’s intent to treat them as separate categories.

Late Fees and Interest Charges

In docket 045, Mr. Brown challenged the legality of the newly instituted penalties for late payments.

• Petitioner’s Position (Brown):

◦ The statute explicitly limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.”

◦ The HOA’s imposition of a flat $25 late fee is a direct violation of this provision. An invoice provided as evidence showed Mr. Brown was charged this $25 fee plus $1.57 in interest.

• Respondent’s Position (Mogollon Airpark, Inc.):

◦ The HOA argued that the statutory limitation on late fees applied only to regular assessments, not to special assessments. This argument was explicitly rejected by the ALJ.

Underlying Allegations of Financial Misconduct

While the administrative hearings were limited to the specific statutory violations, the petitions were motivated by deep-seated concerns over the HOA’s financial management. These allegations were not adjudicated but were noted by the ALJ.

• Core Allegation: The petitioners claimed the HOA treasurer and others engaged in “deceptive and nonstandard accounting methods” to manufacture a financial crisis and justify the assessment increase.

• Specific Claims:

◦ Mr. Brown alleged that the accounting was “deliberately misleading” to obscure the fact that the 2016 board left the treasury approximately “$200,000 better off.”

◦ Mr. Stevens submitted a 45-page petition with over 600 pages of exhibits detailing the alleged improprieties, including “keeping two sets of books,” to create a “fabricated shortfall.” He testified that he believed the HOA possessed over $1 million and did not need an increase.

• Judicial Comment: The ALJ noted that these complex financial allegations were not addressed in the hearing and suggested that “the civil courts may be better suited than an administrative tribunal to address the issues they raise.”

Judicial Decisions and Rationale

The ALJ issued separate findings and orders for each docket, culminating in a split decision. The rulings on the assessment increase were further solidified in a subsequent rehearing.

Summary of Outcomes

Docket No.

Petitioner

Core Issue

Ruling

Prevailing Party

18F-H1818029-REL-RHG

Warren R. Brown

Assessment Increase

Petition Dismissed

Mogollon Airpark, Inc.

18F-H1818054-REL

Brad W. Stevens

Assessment Increase

Petition Dismissed

Mogollon Airpark, Inc.

18F-H1818045-REL

Warren R. Brown

$25 Late Fee

Violation Found

Warren R. Brown

Rationale for Initial Decision (October 18, 2018)

• On the Assessment Increase: The ALJ found that the petitioners failed to prove by a preponderance of the evidence that a violation occurred. The ruling rested on statutory interpretation:

◦ The petitioners’ definition of “regular assessment” as a process was rejected because it would render the word “regular” in the statute “trivial or void,” as all assessments are presumed to follow a regular process.

◦ The only “fair and sensible result” that gives meaning to every word in the statute is to interpret “regular” and “special” as distinct types of assessments.

• On the Late Fees: The ALJ found that Mr. Brown successfully proved a violation.

◦ The statutory text on late fees applies to “assessments” generally, without the qualifier “regular.”

◦ Mogollon’s argument required adding the word “regular” where the legislature did not use it, which violates principles of statutory construction.

◦ Order: Mogollon was ordered to rescind the $25 fee assessed against Mr. Brown and reimburse his $500 filing fee.

Rationale for Rehearing Decision (March 1, 2019)

Mr. Stevens’s request for a rehearing on his dismissed petition was granted but ultimately denied again.

• Mr. Stevens’s Rehearing Arguments: He argued the ALJ erred by not applying a definition of “special assessment” from the case Northwest Fire District v. U.S. Home of Arizona and reasserted that an assessment unauthorized by the HOA’s documents must logically be a regular one.

• ALJ’s Rejection:

◦ The reliance on Northwest Fire District was “misplaced” because that case applies to special taxing districts created under a different state title, not private HOAs.

◦ The argument that an unauthorized special assessment becomes a regular one was deemed “nonsensical.” The ALJ noted, “More reasonably, if Mogollon has no authority to issue a special assessment, any such assessment would be void.”

◦ The core statutory interpretation from the initial hearing was affirmed. The petition was dismissed a final time.

Study Guide: Brown and Stevens v. Mogollon Airpark, Inc.

Short Answer Quiz

Instructions: Answer the following questions in 2-3 sentences each, based on the provided legal documents.

1. Identify the petitioners and the respondent in this consolidated legal matter and describe their relationship.

2. What specific financial changes did Mogollon Airpark, Inc. implement in 2018 that led to the legal dispute?

3. What was the central legal argument presented by petitioners Warren R. Brown and Brad W. Stevens regarding the assessment increase?

4. How did Mogollon Airpark, Inc. justify its total assessment increase of $325 in the face of the legal challenge?

5. Explain the Administrative Law Judge’s primary reason for dismissing the petitions concerning the assessment increase (the 029 and 054 matters).

6. What was the specific subject of the petition in the 045 matter, and what was the final ruling in that case?

7. What was the judge’s legal reasoning for finding Mogollon’s $25 late fee to be in violation of the statute?

8. Why did the hearing not address the petitioners’ underlying allegations of deceptive accounting and financial impropriety?

9. What is the standard of proof required in this matter, and which parties were responsible for meeting it?

10. In the rehearing for the 054 matter, what was Brad Stevens’s argument regarding the definition of “special assessment,” and why did the judge find his reliance on the Northwest Fire District case to be misplaced?

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Quiz Answer Key

1. The petitioners were Warren R. Brown and Brad W. Stevens, who were members of the homeowners’ association (HOA). The respondent was Mogollon Airpark, Inc., the HOA itself. The dispute arose from actions taken by the HOA board that the petitioners, as members, believed to be unlawful.

2. In 2018, Mogollon Airpark, Inc. raised its total annual assessment by $325 over the previous year’s $825. Additionally, the HOA instituted a new late payment fee of $25 and began charging 18% interest on past-due accounts.

3. The petitioners’ central argument was that the total $325 assessment increase, representing a 39.4% hike over the prior year, violated ARIZ. REV. STAT. section 33-1803(A). This statute prohibits an HOA from imposing a “regular assessment” that is more than 20% greater than the previous year’s assessment without member approval.

4. Mogollon Airpark, Inc. argued that the $325 increase was composed of two separate parts: a $116 increase to the “regular assessment” (14.1%) and a $209 “special assessment.” They contended that the 20% statutory limit in section 33-1803(A) applies only to regular assessments, not special assessments, and therefore their actions were lawful.

5. The judge dismissed the petitions based on principles of statutory construction. He concluded that “regular assessment” is a specific type of assessment, distinct from a “special assessment,” and that if “regular” merely referred to the process of passing an assessment (motion, second, vote), the word would be redundant and meaningless in the statute. Since the regular assessment portion of the increase was below the 20% threshold, no violation occurred.

6. The 045 matter, filed by Warren R. Brown, specifically challenged Mogollon’s new $25 late fee and 18% interest charge. The judge ruled in favor of Mr. Brown, deeming him the prevailing party, and ordered Mogollon to rescind the $25 late fee and refund his $500 filing fee.

7. The judge found the $25 late fee violated the statute because the section of ARIZ. REV. STAT. section 33-1803(A) limiting late charges applies to “assessments” generally, not just “regular assessments.” Unlike the clause on assessment increases, the legislature did not use the limiting word “regular,” so applying that limitation would violate principles of statutory construction.

8. The hearing did not address the allegations of deceptive accounting because the petitions filed by Mr. Brown (029) and Mr. Stevens (054) were “single-issue petitions.” This limited the scope of the hearing strictly to the question of whether Mogollon violated the specific statute, section 33-1803(A). The judge noted that civil courts may be a more suitable venue for the financial allegations.

9. The standard of proof required was a “preponderance of the evidence.” The burden of proof was on the petitioners, Messrs. Brown and Stevens, to prove their respective allegations against the respondent, Mogollon Airpark, Inc.

10. Mr. Stevens argued that the definition of “special assessment” from the case Northwest Fire District v. U.S. Home of Arizona should be applied, which it failed to meet. The judge found this reliance misplaced because that case applies to special taxing districts created under ARIZ. REV. STAT. Title 48, and Mogollon Airpark, Inc. is an HOA, not such a taxing district.

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Essay Questions

Instructions: The following questions are designed for a more in-depth, essay-format response. Do not provide answers.

1. Analyze the competing interpretations of the term “regular assessment” as presented by the petitioners and the respondent. Discuss the Administrative Law Judge’s final interpretation and the principles of statutory construction used to arrive at that conclusion.

2. The Administrative Law Judge’s decision distinguishes between the legality of the assessment increase and the legality of the late fee. Explain the legal reasoning behind this split decision, focusing on the specific wording of ARIZ. REV. STAT. section 33-1803(A) and the different statutory construction applied to each clause.

3. Discuss the procedural limitations of the hearings as described in the legal decision, specifically referencing the concept of a “single-issue petition.” How did this limitation affect the scope of the case and prevent the judge from ruling on certain serious allegations made by Brown and Stevens?

4. Based on the “Findings of Fact,” describe the background allegations of financial misconduct made by the petitioners against Mogollon’s treasurer and board. Although not ruled upon, explain how these allegations served as the primary motivation for their legal challenges regarding the assessment and fee increases.

5. Trace the procedural history of the “029 matter,” from its original petition and dismissal to the eventual rehearing and final order. What does this process reveal about the requirements for filing a successful petition with the Office of Administrative Hearings?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official who presides over administrative hearings, weighs evidence, and makes legal rulings and decisions, in this case, Judge Thomas Shedden.

ARIZ. REV. STAT. section 33-1803(A)

The specific Arizona statute at the heart of the dispute. It limits HOA regular assessment increases to 20% over the prior year and caps late payment charges to the greater of $15 or 10% of the unpaid assessment.

Assessment

A fee or charge levied by a homeowners’ association on its members to cover operating expenses, reserve funds, and other costs.

Bylaws

A set of rules adopted by an organization, like an HOA, to govern its internal management and operations. Part of the governing documents.

Covenants, Conditions & Restrictions. These are legal obligations recorded in the deed of a property, governing its use and maintenance. Part of the governing documents.

Consolidated Matter

A legal procedure where multiple separate cases or petitions involving common questions of law or fact are combined into a single hearing to promote efficiency.

Docket Number

A unique number assigned by a court or administrative office to identify a specific case. The matters in this case were identified as 029, 045, and 054.

Governing Documents

The collection of legal documents, including CC&Rs and Bylaws, that establish the rules and authority of a homeowners’ association.

Petitioner

The party who files a petition initiating a legal action in an administrative or court proceeding. In this case, Warren R. Brown and Brad W. Stevens.

Preponderance of the Evidence

The standard of proof in this case. It means the greater weight of the evidence shows that a fact is more likely than not to be true.

Regular Assessment

As interpreted by the ALJ, a specific type of recurring annual assessment for an HOA’s general operating budget, subject to the 20% increase limit in section 33-1803(A).

Respondent

The party against whom a petition is filed. In this case, Mogollon Airpark, Inc.

Single-Issue Petition

A petition that limits the scope of the administrative hearing to a single, specific legal question or alleged violation, as was the case for the 029 and 054 matters.

Special Assessment

As interpreted by the ALJ, a one-time or non-recurring assessment levied for a specific purpose (e.g., replenishing a reserve fund). The ALJ found it is not subject to the 20% annual increase cap that applies to regular assessments.

Statutory Construction

The process and principles used by judges to interpret and apply legislation. The judge used these principles to determine the meaning of “regular” and “assessment” in the statute.

How One Word Let an HOA Raise Dues by 40%—And 4 Surprising Lessons for Every Homeowner

Imagine opening your annual bill from your Homeowner’s Association (HOA) and discovering your dues have skyrocketed by nearly 40% overnight. This isn’t a hypothetical scenario. It’s precisely what happened to homeowners in the Mogollon Airpark community in Arizona when their HOA board raised the annual assessment by $325, from $825 to $1,150—a staggering 39.4% increase.

But the homeowners weren’t just angry about the amount; they alleged the increase was justified by a “fabricated shortfall” created through “deceptive and nonstandard accounting methods.” At first glance, the hike also seemed legally impossible. Arizona state law, specifically ARIZ. REV. STAT. section 33-1803(A), clearly states that an HOA cannot impose a regular assessment that is more than 20% greater than the previous year’s. So how did the Mogollon Airpark board legally circumvent this cap? The answer, found in the fine print of an administrative law judge’s decision, reveals critical lessons for every homeowner about the power of language, legal strategy, and reading the fine print.

1. The Power of a Name: The “Special Assessment” Loophole

The HOA’s strategy was deceptively simple. Instead of raising the annual assessment by the full $325, the Mogollon Airpark board split the increase into two distinct parts. First, it raised the “regular assessment” by $116. This amounted to a 14.1% increase over the previous year’s $825, keeping it well within the 20% legal limit. The remaining $209 was then levied as a separate fee, which the board classified as a “special assessment.”

When homeowners challenged this, the Administrative Law Judge sided with the HOA. The judge’s ruling was based on a strict reading of the statute: the 20% cap applies only to “regular assessments,” not “special assessments.” By simply calling a portion of the increase a “special assessment,” the HOA legally circumvented the very law designed to protect homeowners from massive, sudden fee hikes.

Lesson 1 for Homeowners: The name of a fee is everything. State-mandated caps on “regular” assessments offer zero protection if your HOA can simply reclassify an increase as a “special” assessment.

2. Every Word Is a Battlefield: “Regular” Doesn’t Mean What You Think

The homeowners, petitioners Warren Brown and Brad Stevens, built their case on a common-sense interpretation of the law. They argued that the term “regular assessment” in the statute referred to the process by which an assessment is created—that is, any fee approved through a regular motion, second, and vote by the board. By this logic, the entire $325 increase was a single “regular assessment” and therefore violated the 20% cap. They also argued that the HOA had no authority under its own governing documents to impose a special assessment in the first place.

The judge, however, rejected this definition. The judge reasoned that lawmakers don’t add words to statutes for no reason. If “regular” simply meant “voted on normally,” the word would be redundant, as all assessments are assumed to be passed this way. To give the word meaning, it must refer to a specific type of assessment. To support this interpretation, the judge pointed to another Arizona statute, 33-1806, which explicitly uses the distinct terms “regular assessments” and “special assessment[s].” This proved that the state legislature intended for them to be entirely different categories of fees, cementing the HOA’s victory on the main issue.

Lesson 2 for Homeowners: Every word in a statute has a purpose. Courts assume lawmakers don’t use words accidentally, and a layperson’s “common-sense” definition of a term can be easily defeated by established principles of legal interpretation.

3. A Small Victory on a Technicality: Why You Should Still Read the Fine Print

While the homeowners lost the battle over the 39.4% dues increase, one petitioner, Mr. Brown, secured a small but significant win on a separate issue: late fees. The Mogollon Airpark board had instituted a new $25 late fee, which Mr. Brown challenged.

Arizona law limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.” The HOA argued that this limit, like the 20% cap, only applied to regular assessments. This time, the judge disagreed. The judge’s logic was a textbook example of statutory interpretation: when lawmakers include a specific word in one part of a law but omit it from another, courts assume the omission was deliberate. In the section of the law governing late fees, the limit applies to “assessments” in general; the word “regular” is conspicuously absent.

Because the HOA’s $25 fee exceeded the legal limit, the judge ruled in favor of Mr. Brown. The court ordered the HOA to rescind the illegal late fee and, importantly, to reimburse Mr. Brown for his $500 filing fee.

Lesson 3 for Homeowners: The fine print cuts both ways. While one word can create a loophole for an HOA, the absence of that same word elsewhere can be your most powerful weapon.

4. Fighting the Right Battle in the Right Place: The Allegations a Judge Couldn’t Hear

Underlying the dispute over the 20% cap were much more serious allegations. The homeowners’ petitions claimed the HOA board used “deceptive and nonstandard accounting methods,” including keeping “two sets of books,” to create a “fabricated shortfall” and justify the massive fee increase.

Yet, none of these explosive claims were ever addressed during the hearing. The reason was a crucial matter of legal procedure. The homeowners had filed what are known as “single-issue petitions,” which focused narrowly and exclusively on the violation of the 20% assessment cap in statute 33-1803(A). This strategic choice legally prevented the judge from considering the broader allegations of financial mismanagement, regardless of their merit.

In a pointed footnote, the judge highlighted the procedural constraints and suggested the homeowners had chosen the wrong legal venue for their most serious claims:

Considering the nature of Messrs. Brown and Stevens’s allegations, the civil courts may be better suited than an administrative tribunal to address the issues they raise.

Lesson 4 for Homeowners: Your legal strategy is as important as your evidence. Choosing the right claims to file and the right venue to file them in can determine whether a judge is even allowed to hear your most compelling arguments.

Conclusion: Your Most Powerful Tool

The case of Mogollon Airpark is a powerful illustration of how legal battles are won and lost not on broad principles of fairness, but on the precise definitions of individual words. The presence of the word “regular” in one clause of the law cost the homeowners their central fight, allowing the HOA to circumvent the 20% cap. In a stunning contrast, the absence of that very same word in another clause handed them a clear victory on late fees.

This case is a stark reminder of the power hidden in legal definitions and fine print. It leaves every homeowner with a critical question: Do you really know what your governing documents—and the state laws that bind them—truly allow?

Case Participants

Petitioner Side

Warren R. Brown (petitioner)
Appeared pro se
Brad W. Stevens (petitioner)
Appeared pro se; presented testimony/evidence

Respondent Side

Gregory A. Stein (respondent attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Mark K. Sahl (respondent attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Spelled Mark K. Saul in some transmissions

Neutral Parties

Thomas Shedden (ALJ)
OAH
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Felicia Del Sol (clerk/staff)
Transmitting staff

Nathan Brown v. Val Vista Lakes Community Association

Posted on February 4, 2019 by [email protected]

Case Summary

Case ID	19F-H1918029-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2019-02-04
Administrative Law Judge	Thomas Shedden
Outcome	The Petitioner's claim that the Respondent HOA violated A.R.S. § 33-1803(E) was dismissed, as the notice issued was determined to be a Notice of Non-Compliance (courtesy letter) and not a Notice of Violation required to carry the specific disclosure.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Nathan Brown	Counsel	—
Respondent	Val Vista Lakes Community Association	Counsel	Clint Goodman, Esq.

Alleged Violations

ARIZ. REV. STAT. section 33-1803(E)

Outcome Summary

The Petitioner's claim that the Respondent HOA violated A.R.S. § 33-1803(E) was dismissed, as the notice issued was determined to be a Notice of Non-Compliance (courtesy letter) and not a Notice of Violation required to carry the specific disclosure.

Why this result: The Petitioner failed to meet the burden of proof to show that the Respondent violated A.R.S. § 33-1803(E).

Key Issues & Findings

Whether the HOA violated A.R.S. § 33-1803(E) by failing to include notice of the option to petition for an administrative hearing in a Notice of Non-Compliance.

Petitioner alleged that the Respondent's Notice of Non-Compliance regarding dead vegetation was actually a Notice of Violation and lacked the statutory disclosure required by A.R.S. § 33-1803(E). The ALJ found the document was a courtesy letter and not a Notice of Violation, and even if it were, the statute did not require the disclosure in this context because the Petitioner filed the petition before Respondent took enforcement action or completed the statutory response exchange.

Orders: Petitioner Nathan Brown's petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1803(E)
ARIZ. REV. STAT. section 32-2199.01
ARIZ. REV. STAT. section 33-1803(C)
ARIZ. REV. STAT. section 33-1803(D)
ARIZ. ADMIN. CODE § R2-19-119
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11

Analytics Highlights

Topics: statutory interpretation, violation notice, non-compliance, courtesy letter, right to petition

Additional Citations:

33-1803(E)
32-2199.01
33-1803(C)
33-1803(D)
R2-19-119

Video Overview

Audio Overview

Decision Documents

19F-H1918029-REL Decision – 686796.pdf

Uploaded 2026-04-25T09:59:54 (88.4 KB)

Brown v. Val Vista Lakes Community Association: Case Briefing

Executive Summary

This document provides a detailed analysis of the Administrative Law Judge (ALJ) Decision in case No. 19F-H1918029-REL, wherein Petitioner Nathan Brown’s petition against the Val Vista Lakes Community Association was dismissed. The central issue was whether an initial “Notice of Non-Compliance” sent by the Association constituted a formal “Notice of Violation” under Arizona Revised Statutes (A.R.S.) section 33-1803(E), thereby requiring immediate disclosure of the member’s right to an administrative hearing.

The ALJ ruled decisively in favor of the Respondent Association. The decision rested on two primary conclusions: First, a reasonable reading of the document in question showed it to be a preliminary “courtesy letter” and not a formal Notice of Violation, as it explicitly warned that a Notice of Violation would be issued later if the issue was not remedied. Second, the ALJ determined that even if the document were considered a Notice of Violation, a plain reading of the statute does not require the disclosure of hearing rights to be included in the initial notice itself. The statute allows for this information to be provided at a later stage in the process, specifically after the member has submitted a formal response. The Petitioner’s failure to follow the statutory response procedure was a key factor in the ruling that the Association had not yet been required to provide the disclosure. Ultimately, the Petitioner failed to meet the burden of proof, and his petition was dismissed.

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Case Overview

Case Number

19F-H1918029-REL

Parties

Petitioner: Nathan Brown
Respondent: Val Vista Lakes Community Association

Adjudicator

Administrative Law Judge Thomas Shedden

Office of Administrative Hearings, Phoenix, Arizona

Hearing Date

January 16, 2019

Decision Date

February 4, 2019

Final Outcome

Petition Dismissed; Respondent deemed the prevailing party.

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Background and Timeline of Events

• October 18, 2018: The Val Vista Lakes Community Association mailed a “Notice of Non-Compliance” to Nathan Brown regarding dead vegetation in his yard. The notice requested that the situation be remedied by November 1, 2018, and warned that failure to do so would result in the issuance of a “Notice of Violation that may involve fines.”

• October 24, 2018 (approx.): Mr. Brown filed a petition with the Arizona Department of Real Estate, initiating the legal matter.

• November 11, 2018: The Association issued a formal “Notice of Violation” to Mr. Brown concerning the same issue raised in the initial notice.

• November 27, 2018: The Arizona Department of Real Estate issued a Notice of Hearing.

• January 16, 2019: An administrative hearing was held, with Mr. Brown representing himself and Clint Goodman, Esq. representing the Association. Testimony was heard from Mr. Brown and Simone McGinnis, the Association’s general manager.

• February 4, 2019: ALJ Thomas Shedden issued a decision dismissing Mr. Brown’s petition.

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Core Legal Dispute and Arguments

The dispute centered on the interpretation and application of A.R.S. § 33-1803, which governs the process for notifying homeowners of violations of community documents.

Petitioner’s Position (Nathan Brown)

• Central Claim: The “Notice of Non-Compliance” received on October 18, 2018, was functionally and legally a “Notice of Violation.”

• Alleged Violation: The notice violated A.R.S. § 33-1803(E) because it failed to include “written notice of the member’s option to petition for an administrative hearing on the matter in the state real estate department.”

Respondent’s Position (Val Vista Lakes Community Association)

• Central Claim: The “Notice of Non-Compliance” was not a formal “Notice of Violation” but rather a “courtesy letter,” which is a common industry practice permitted by the Association’s governing documents.

• Defense: Because the initial letter was not a statutory Notice of Violation, the requirements of A.R.S. § 33-1803 were not applicable to that specific communication.

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Administrative Law Judge’s Analysis and Decision

The ALJ concluded that the Petitioner, Mr. Brown, bore the burden of proof by a preponderance of the evidence and failed to meet that standard. The decision was based on a series of factual findings and legal conclusions drawn from a “fair and sensible” interpretation of the statute.

Key Findings of Fact

• The Association mailed Mr. Brown a Notice of Non-Compliance on October 18, 2018.

• This notice informed Mr. Brown of a CC&R violation (dead vegetation) and stated that a failure to remedy the issue would result in a subsequent “Notice of Violation” with potential fines.

• Mr. Brown did not send a written response to the Association regarding the Notice of Non-Compliance, a step outlined in A.R.S. § 33-1803(C).

• Mr. Brown was later issued a formal Notice of Violation on November 11, 2018.

Conclusions of Law (Legal Rationale)

The ALJ’s decision to dismiss the petition was founded on three distinct legal interpretations:

1. Distinction Between Notices: The judge ruled that the initial communication was not a statutory Notice of Violation.

◦ The ruling states, “a reasonable reading of the Notice of Non-Compliance shows that it is not a Notice of Violation, because it informs Mr. Brown that a Notice of Violation would be issued if he did not appropriately address the ‘situation.'”

◦ This established the letter as a preliminary courtesy notice, distinct from the formal enforcement action that triggers statutory requirements.

2. Statutory Interpretation of A.R.S. § 33-1803: The judge concluded that even if the initial notice was a Notice of Violation, the Association still did not violate the statute.

◦ The decision notes, “a plain reading of ARIZ. REV. STAT. section 33-1803 shows that a Notice of Violation is not required to include notice of the right to petition the Department of Real Estate because subsections D and E both show that any required notice can be given at other times.”

◦ The statute outlines a process where the member can respond via certified mail, and the Association’s duty to provide information about contesting the notice (including the right to a hearing) arises from that exchange.

3. Petitioner’s Procedural Failure: The judge found that the Association’s obligations under the statute were never triggered because Mr. Brown bypassed the prescribed process.

◦ The decision highlights that Mr. Brown did not file a written response with the Association but instead filed his petition with the Department just a few days after receiving the initial notice.

◦ The ruling concludes, “a sensible reading of the statute shows that the Respondent was not required to provide Mr. Brown with notice of a right to petition the Department at any time pertinent to this matter.”

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Final Order and Implications

• Order: The ALJ ordered that “Petitioner Nathan Brown’s petition is dismissed.”

• Prevailing Party: The Respondent, Val Vista Lakes Community Association, was deemed the prevailing party in the matter.

• Further Action: The decision is binding unless a party files for a rehearing with the Commissioner of the Department of Real Estate within 30 days of the service of the order, as stipulated by A.R.S. §§ 32-2199.02(B), 32-2199.04, and 41-1092.09.

Study Guide: Brown v. Val Vista Lakes Community Association (No. 19F-H1918029-REL)

Short Answer Quiz

Instructions: Answer the following questions in 2-3 complete sentences, drawing all information from the provided case decision.

1. Who were the primary parties involved in case No. 19F-H1918029-REL, and what were their roles?

2. What specific statute did the Petitioner, Nathan Brown, allege that the Respondent violated?

3. What was the initial issue that prompted the Respondent to contact Mr. Brown on October 18, 2018?

4. What was Nathan Brown’s central legal argument concerning the “Notice of Non-Compliance”?

5. How did the Val Vista Lakes Community Association characterize the “Notice of Non-Compliance,” and why was this distinction critical to its defense?

6. According to the Findings of Fact, what procedural step did Mr. Brown fail to take after receiving the initial notice from the association?

7. What is the standard of proof required in this matter, and which party was responsible for meeting it?

8. What were the Administrative Law Judge’s two primary legal conclusions that led to the dismissal of the petition?

9. What was the final Order issued by the Administrative Law Judge on February 4, 2019?

10. What recourse was available to the parties following the judge’s Order, and what was the specified time limit for that action?

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Answer Key

1. The primary parties were Nathan Brown, who served as the Petitioner, and the Val Vista Lakes Community Association, which was the Respondent. Mr. Brown brought the complaint against the association, which was defending its actions.

2. Nathan Brown alleged that the Respondent violated ARIZ. REV. STAT. section 33-1803(E). This section concerns an association’s obligation to provide a member with written notice of their option to petition for an administrative hearing.

3. The Respondent contacted Mr. Brown regarding dead vegetation in his yard, which was considered a violation of the community’s CC&Rs. The “Notice of Non-Compliance” requested that he remedy the situation by November 1, 2018.

4. Mr. Brown’s central argument was that the “Notice of Non-Compliance” was, in fact, a “Notice of Violation.” Therefore, he contended it should have included written notice of his option to petition for an administrative hearing with the state real estate department, as required by statute.

5. The Association characterized the notice as a “courtesy letter,” which is a common practice for providing an initial warning before formal action. This distinction was critical because the Association argued that as a mere courtesy letter and not a formal “Notice of Violation,” it was not subject to the statutory disclosure requirements of ARIZ. REV. STAT. section 33-1803.

6. Mr. Brown did not send a written response to the Respondent via certified mail within 21 calendar days of the notice. This response is an option provided to members under ARIZ. REV. STAT. section 33-1803(C).

7. The standard of proof was a “preponderance of the evidence.” The burden of proof was on the Petitioner, Nathan Brown, to show that the Respondent had violated the statute.

8. First, the judge concluded that a reasonable reading of the document shows it was not a “Notice of Violation” because it explicitly threatened that one would be issued later. Second, the judge concluded that even if it were a “Notice of Violation,” the statute does not require the hearing disclosure to be in the initial notice, and since Mr. Brown did not follow the response procedure, the Respondent’s obligation to provide that disclosure had not yet been triggered.

9. The final Order was that Petitioner Nathan Brown’s petition be dismissed. The judge also deemed the Respondent to be the prevailing party in the matter.

10. A party could file a request for a rehearing with the Commissioner of the Department of Real Estate. Pursuant to ARIZ. REV. STAT. section 41-1092.09, this request had to be filed within 30 days of the service of the Order.

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Essay Questions

Instructions: Consider the following questions. Formulate comprehensive, evidence-based answers using only the information and legal reasoning presented in the case decision.

1. Analyze the distinction between a “Notice of Non-Compliance” (or “courtesy letter”) and a “Notice of Violation” as presented in this case. Discuss why this distinction was the central point of contention and how the Administrative Law Judge’s interpretation of the document’s plain language resolved the issue.

2. Explain the legal standard of “preponderance of the evidence” as defined in the decision. Discuss how Nathan Brown’s failure to meet this standard, as the party with the burden of proof, was fundamental to the dismissal of his petition.

3. Examine the Administrative Law Judge’s interpretation of the procedural requirements outlined in ARIZ. REV. STAT. section 33-1803(C), (D), and (E). How does the judge’s “sensible reading” of the statute’s timeline and reciprocal obligations undermine the Petitioner’s claim, even setting aside the debate over the notice’s title?

4. Describe the complete procedural timeline of this case, from the initial notice sent by the association to the final order from the Administrative Law Judge. Identify the key dates and actions taken by each party and by the Office of Administrative Hearings.

5. Discuss the role of statutory interpretation in this legal decision. How did the judge apply established legal principles, such as aiming for a “fair and sensible result” and avoiding “absurd and unreasonable construction,” to support the final ruling against the Petitioner?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

The official, in this case Thomas Shedden, who presides over administrative hearings and makes legal decisions.

ARIZ. REV. STAT.

Abbreviation for Arizona Revised Statutes, which are the codified laws of the state of Arizona. The specific statute at the center of this case is section 33-1803.

Burden of Proof

The obligation of a party in a legal case to prove their allegations. In this matter, the burden of proof was on the Petitioner, Nathan Brown.

An acronym for Covenants, Conditions, and Restrictions. The decision implies these are the governing community documents that Mr. Brown was accused of violating due to dead vegetation.

Courtesy Letter

A term used by the Respondent to describe the “Notice of Non-Compliance.” It is characterized as a common industry practice to inform a resident of an issue before issuing a formal Notice of Violation.

Notice of Non-Compliance

The specific document dated October 18, 2018, sent to Mr. Brown. It informed him of dead vegetation, requested a remedy, and warned that a “Notice of Violation” could follow.

Notice of Violation

A formal notification that a violation has occurred. The decision establishes this as a distinct and more serious step than a “Notice of Non-Compliance,” and one was issued to Mr. Brown on November 11, 2018.

Petitioner

The party who files a petition initiating a legal action. In this case, Nathan Brown was the Petitioner.

Preponderance of the Evidence

The standard of proof required in this hearing. It is defined as “The greater weight of the evidence… sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Prevailing Party

The party who wins the legal case. The Administrative Law Judge deemed the Respondent to be the prevailing party.

Rehearing

A legal process to have a case heard again. The parties were notified of their right to request a rehearing with the Commissioner of the Department of Real Estate within 30 days.

Respondent

The party against whom a petition is filed. In this case, the Val Vista Lakes Community Association was the Respondent.

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19F-H1918029-REL

1 source

This source is the Administrative Law Judge Decision for a case titled Nathan Brown vs. Val Vista Lakes Community Association, heard by the Arizona Office of Administrative Hearings. The dispute centers on whether a Notice of Non-Compliance sent to Mr. Brown regarding dead vegetation in his yard constitutes a Notice of Violation under ARIZ. REV. STAT. section 33-1803(E). Mr. Brown argued that the Association violated this statute by failing to include written notice of his option to petition for an administrative hearing in the initial notice. However, the Administrative Law Judge found that the initial document was merely a courtesy letter and not a formal Notice of Violation, and further concluded that the statute does not require the disclosure of the right to petition the Department of Real Estate within the initial violation notice. Ultimately, the judge determined that the Association was not required to provide Mr. Brown with the notice of his right to petition at any relevant time and dismissed Mr. Brown’s petition.

Case Participants

Petitioner Side

Nathan Brown (petitioner)
Appeared on his own behalf

Respondent Side

Clint Goodman (HOA attorney)
Goodman Law Group
Appeared for the Respondent
Simone McGinnis (general manager)
Val Vista Lakes Community Association
Presented testimony
Ashley N. Moscarello (HOA attorney)
Goodman Law Group
Recipient of transmission
Clint Brown (HOA attorney)
Goodman Law Group
Recipient of transmission (listed separately from Clint Goodman)

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Judy Lowe (Commissioner)
Arizona Department of Real Estate
F Del Sol (admin staff)
Transmitted document

Jerry R. Collis vs. Laveen Meadows Homeowners Association

Posted on December 18, 2018 by [email protected]

Case Summary

Case ID	19F-H18020-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-12-20
Administrative Law Judge	Thomas Shedden
Outcome	The Petitioner's challenge against the HOA was dismissed because the Petitioner failed to prove by a preponderance of the evidence that the HOA violated the community documents or statutes when issuing citations.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Jerry R. Collis	Counsel	—
Respondent	Laveen Meadows HOA c/o Planned Development Services	Counsel	Chad Gallacher, Esq.

Alleged Violations

CC&Rs Sections 10.11.2, 10.11.4, and 10.16; A.R.S. § 32-2199.01(A)

Outcome Summary

The Petitioner's challenge against the HOA was dismissed because the Petitioner failed to prove by a preponderance of the evidence that the HOA violated the community documents or statutes when issuing citations.

Why this result: Petitioner failed to meet the burden of proof.

Key Issues & Findings

Challenge to HOA fine citations/improper enforcement of parking and nuisance rules

Petitioner claimed the Respondent HOA improperly issued citations against him for vehicle violations (inoperable vehicle, street parking, nuisance), asserting the HOA could not violate CC&R 10.11.4 but that the citations alleging the violation were unwarranted.

Orders: Petitioner Jerry R. Collis’s petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
ARIZ. REV. STAT. § 32-2199.01

Analytics Highlights

Topics: HOA Enforcement, CC&Rs, Vehicle Parking, Nuisance, Burden of Proof

Additional Citations:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
ARIZ. REV. STAT. § 32-2199.01

Video Overview

Audio Overview

Decision Documents

19F-H18020-REL Decision – 677244.pdf

Uploaded 2026-04-24T11:14:51 (97.6 KB)

Briefing Document: Collis v. Laveen Meadows HOA (Case No. 19F-H18020-REL)

Executive Summary

This document synthesizes the findings and decision in the administrative hearing of Jerry R. Collis (Petitioner) versus the Laveen Meadows HOA (Respondent). The Administrative Law Judge dismissed Mr. Collis’s petition, which alleged the HOA had wrongly issued citations concerning his vehicle.

The central issue revolved around a series of violation notices issued to Mr. Collis for an “Inoperable Vehicle.” While Mr. Collis focused his argument on proving the vehicle was, in fact, operational, the HOA successfully argued that the citations were based on a broader set of violations. These included not only the vehicle’s condition under CC&R Section 10.11.4 but also violations for street parking (Section 10.11.2) and creating a nuisance (Section 10.16) due to its unsightly appearance, which included cobwebs, debris, a flat tire, and a covered window.

The Judge concluded that the petitioner, Mr. Collis, failed to meet the burden of proof. By only addressing the vehicle’s operability, he did not disprove the other valid grounds for the citations. Consequently, the Judge found that the HOA had not violated its own governing documents or state statutes, dismissing the petition and declaring the HOA the prevailing party.

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1. Case Overview and Core Dispute

• Case Number: 19F-H18020-REL

• Parties:

◦ Petitioner: Jerry R. Collis (representing himself)

◦ Respondent: Laveen Meadows HOA (represented by Chad Gallacher, Esq.)

• Adjudicator: Thomas Shedden, Administrative Law Judge

• Hearing Date: December 4, 2018

• Decision Date: December 20, 2018

The Petitioner’s Allegation

On September 17, 2018, Jerry R. Collis filed a petition with the Arizona Department of Real Estate. The initial Notice of Hearing framed the allegation as the Laveen Meadows HOA having violated Article 10, Section 10.11.4 of its Covenants, Conditions, and Restrictions (CC&Rs), which pertains to inoperable vehicles.

At the December 4, 2018 hearing, Mr. Collis clarified his position. He argued that the issue was not that the HOA itself could violate that section, but that the HOA had wrongly issued him citations alleging a violation of that provision when his vehicle was fully operational.

The Respondent’s Position

The Laveen Meadows HOA, represented by Community Manager Lisa Riesland, objected to this reframing of the issue. The HOA contended that the citations issued to Mr. Collis were justified under multiple sections of the CC&Rs, not solely the “inoperable vehicle” clause. The HOA’s actions were based on violations of Sections 10.11.2 (street parking), 10.11.4 (inoperable vehicle), and 10.16 (nuisance).

2. Relevant CC&R Provisions

The dispute centered on the interpretation and application of three specific sections within the Laveen Meadows HOA CC&Rs.

Section

Title / Subject

Description

10.11.4

Inoperable Vehicles

Prohibits any motor vehicle “which are not in operating condition” from being parked in unenclosed areas, including driveways. This section was amended in May 2013 to clarify the definition of “operating condition.”

10.11.2

Street Parking

Prohibits parking on the streets within the community.

Nuisances

Prohibits nuisances, which are defined to include conditions that are “unsightly or that could reasonably cause annoyance to other members of the Association.”

3. Analysis of Evidence and Timeline

Violation Notices and Fines

Between September 2016 and June 2017, the HOA sent seven notifications to Mr. Collis regarding his vehicle. A key finding from the hearing was that while all seven notices stated, “Violation: Vehicle Parking – Inoperable Vehicle,” none of them cited a specific provision of the CC&Rs.

The timeline of notifications and fines is as follows:

• September 19, 2016: Initial letter citing expired tags and an inoperable vehicle on the street. Given 10 days to correct.

• October 11, 2016: Letter warning of a potential $25 fine. Notified of appeal rights. No evidence of appeal by Collis.

• December 1, 2016: A $25 fine was charged to Mr. Collis’s account. Mr. Collis appealed this to the HOA Board.

• January 26, 2017: The HOA Board sent a letter to Mr. Collis denying his appeal.

• April 20, 2017: A $50 fine and a $10 mailing fee were charged. No evidence of appeal.

• May 9, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• May 23, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• June 8, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• June 26, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

For each fine assessed from October 2016 onwards, the HOA’s letters informed Mr. Collis of his right to appeal to the Board and to request an administrative hearing. The record shows no evidence that Mr. Collis requested an administrative hearing for any of the fines prior to filing his petition in 2018.

Competing Testimonies

• Petitioner (Collis): Testified that his vehicle was never inoperable. He acknowledged that at the time of the June 2017 letters, the vehicle had a flat tire and a covered window, but explained this was the result of vandalism.

• Respondent (HOA): Community Manager Lisa Riesland provided testimony deemed “credible” by the Judge. She stated that the vehicle’s condition constituted a nuisance under Section 10.16. Specific details included:

◦ Cobwebs and debris on or beneath the vehicle.

◦ At various times, cobwebs extended from the vehicle to the ground, trapping leaves.

◦ The condition was deemed “unsightly.”

4. Legal Conclusions and Final Order

Burden of Proof

The Judge established that Mr. Collis, as the petitioner, bore the burden of proof. The standard required was a “preponderance of the evidence,” meaning evidence sufficient to incline a fair and impartial mind to one side of the issue over the other.

Judge’s Rationale

The decision rested on the following legal conclusions:

1. CC&Rs as a Contract: The CC&Rs constitute a binding contract between the homeowner and the HOA, requiring both parties to comply with its terms. The HOA must act reasonably in exercising its authority.

2. Multiple Grounds for Citations: The preponderance of evidence demonstrated that the HOA’s citations were based on violations of Sections 10.11.2 (street parking), 10.11.4 (inoperable vehicle), and 10.16 (nuisance).

3. Insufficiency of Petitioner’s Argument: Because the citations were multifaceted, Mr. Collis’s argument that his vehicle was in operating condition was insufficient to prove the citations were unwarranted. His claim did not address the evidence of street parking or the unsightly conditions that constituted a nuisance.

4. Failure to Meet Burden of Proof: Ultimately, the Judge concluded: “Mr. Collis has failed to show that the Respondent violated any of the CC&Rs, other community documents, or the statutes that regulate planned communities.”

Final Order

IT IS ORDERED that Petitioner Jerry R. Collis’s petition is dismissed.

The decision established the Laveen Meadows HOA as the prevailing party. This order is binding unless a rehearing is requested with the Commissioner of the Department of Real Estate within 30 days of the service of the order (December 20, 2018).

Study Guide: Collis v. Laveen Meadows HOA

This guide provides a detailed review of the Administrative Law Judge Decision in the matter of Jerry R. Collis (Petitioner) versus Laveen Meadows HOA (Respondent), Case No. 19F-H18020-REL. It includes a short-answer quiz with an answer key, a set of essay questions for deeper analysis, and a glossary of key terms found within the legal document.

Short-Answer Quiz

Instructions: Answer the following questions in 2-3 sentences based on the provided source document.

1. Who were the primary parties involved in this administrative hearing, and who represented them?

2. What was the original violation Mr. Collis alleged against the Laveen Meadows HOA in his petition filed on September 17, 2018?

3. How did Mr. Collis clarify or reframe the issue he was raising during the December 4, 2018 hearing?

4. According to the HOA’s community manager, Lisa Riesland, what three CC&R sections were the basis for the citations issued to Mr. Collis?

5. What common phrase was used to describe the violation in all seven notifications sent to Mr. Collis, and what crucial detail did these notifications omit?

6. Describe the initial fine issued to Mr. Collis, including the date of the letter and the amount.

7. What physical evidence did the HOA present to support its claim that Mr. Collis’s vehicle created an “unsightly condition” under CC&R Section 10.16?

8. In addition to the unsightly conditions, what two other issues with the vehicle were noted around June 2017, and what was Mr. Collis’s explanation for them?

9. According to the “Conclusions of Law,” who bears the burden of proof in this matter, and what is the required standard of proof?

10. What was the final order issued by the Administrative Law Judge, and what was the legal consequence of this decision for the parties?

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Answer Key

1. The primary parties were Jerry R. Collis, the Petitioner, who appeared on his own behalf, and Laveen Meadows HOA, the Respondent. The Respondent was represented by Chad Gallacher, Esq.

2. Mr. Collis’s original petition, as shown in the Notice of Hearing, alleged that the Laveen Meadows HOA had violated Article 10, Section 10.11.4 of its own CC&Rs. This section pertains to parking motor vehicles that are not in operating condition in unenclosed areas.

3. At the hearing, Mr. Collis acknowledged the HOA could not violate its own rule and clarified that the real issue was that the HOA had wrongly issued him citations for violating Section 10.11.4. He argued that he was not, in fact, in violation of that provision.

4. Lisa Riesland testified that the citations were based not just on Section 10.11.4 (inoperable vehicles), but also on Section 10.11.2, which prohibits parking on the streets, and Section 10.16, which prohibits nuisances.

5. All seven notifications sent to Mr. Collis included the statement: “Violation: Vehicle Parking – Inoperable Vehicle.” However, none of the notifications listed a specific provision of the CC&Rs that had allegedly been violated.

6. The first fine was detailed in a letter dated December 1, 2016. The letter informed Mr. Collis that his account had been charged a $25 fine for the ongoing violation of storing an inoperable vehicle on the street.

7. The HOA presented credible testimony from Lisa Riesland that there were cobwebs and debris on or beneath the vehicle. At various times, these cobwebs extended from the vehicle to the ground and had trapped leaves, creating an unsightly condition.

8. Around June 2017, the vehicle also had a flat tire and a bag or cardboard covering one window. Mr. Collis acknowledged these facts and explained that the vehicle had been vandalized.

9. The “Conclusions of Law” state that Mr. Collis, the petitioner, bears the burden of proof. The standard of proof required to decide all issues in the matter is that of a “preponderance of the evidence.”

10. The Administrative Law Judge ordered that Mr. Collis’s petition be dismissed. This legally binding order deemed the Respondent (Laveen Meadows HOA) to be the prevailing party in the matter.

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Essay Questions

Instructions: The following questions are designed for longer, essay-style responses to encourage a deeper analysis of the case. Answers are not provided.

1. Analyze the discrepancy between Mr. Collis’s initial petition alleging a violation of Section 10.11.4 and the actual issue he raised at the hearing. How did this “reframing” of the issue affect his case, and how did the Respondent react?

2. Discuss the concept of “preponderance of the evidence” as defined in the document. Explain how the Administrative Law Judge applied this standard to the evidence presented by both Mr. Collis and the HOA to reach the final decision.

3. Trace the series of notifications and fines issued by the Laveen Meadows HOA, beginning with the September 19, 2016 letter. Evaluate the HOA’s process and communication based on the details provided in the letters. Did the HOA act reasonably, according to the legal standards cited in the decision?

4. The HOA cited three different CC&R sections (10.11.2, 10.11.4, and 10.16) as the basis for the citations, even though the notifications only stated “Vehicle Parking – Inoperable Vehicle.” Explore the significance of each of these sections and explain why Mr. Collis’s focus on his vehicle being operable was insufficient to win his case.

5. Examine the appeal options available to Mr. Collis at each stage of the violation process. Based on the “Findings of Fact,” what actions did he take or fail to take regarding his appeal rights, and how might this have impacted the overall trajectory of the dispute?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (Thomas Shedden in this case) who presides over administrative hearings, weighs evidence, and makes legal rulings and decisions.

ARIZ. ADMIN. CODE

The Arizona Administrative Code, a compilation of rules and regulations of Arizona state agencies. Section R2-19-119 is cited as establishing the standard of proof for the hearing.

ARIZ. REV. STAT.

The Arizona Revised Statutes, which are the codified laws of the state of Arizona. Various sections are cited regarding homeowner association disputes and administrative procedures.

Appearances

A formal term for the individuals present and participating in the hearing. In this case, it was Jerry R. Collis and Chad Gallacher, Esq.

The governing body of the Laveen Meadows HOA, to which Mr. Collis had the right to appeal fines. He appealed one fine to the Board, which was denied.

Burden of Proof

The legal obligation of a party in a dispute to provide sufficient evidence to prove their claim. In this case, the burden of proof was on Mr. Collis.

CC&Rs (Covenants, Conditions & Restrictions)

The governing legal documents that set out the rules for a planned community or homeowners’ association. The decision establishes the CC&Rs as a contract between the HOA and its members.

Community Manager

An individual responsible for managing the operations of the HOA. Lisa Riesland served this role for the Respondent and testified at the hearing.

Conclusions of Law

The section of the decision where the Administrative Law Judge applies legal principles and statutes to the established facts to reach a judgment.

Findings of Fact

The section of the decision that lists the established, undisputed facts of the case based on evidence and testimony presented during the hearing.

Nuisance

A condition prohibited by CC&R Section 10.16. It is defined as a condition that is unsightly or could reasonably cause annoyance to other members of the Association.

Operating Condition

A term from CC&R Section 10.11.4, which was amended in May 2013 to clarify its meaning. Mr. Collis argued his vehicle was always in operating condition.

The final, legally binding ruling of the Administrative Law Judge. In this case, the Order was to dismiss the petitioner’s petition.

Petitioner

The party who initiates a legal action or files a petition. In this matter, Jerry R. Collis is the Petitioner.

Preponderance of the Evidence

The standard of proof required in this hearing. It is defined as “The greater weight of the evidence…sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Respondent

The party against whom a petition is filed. In this matter, Laveen Meadows HOA is the Respondent.

🏛️

19F-H18020-REL

1 source

The provided text consists of an Administrative Law Judge Decision from the Office of Administrative Hearings concerning a dispute between Petitioner Jerry R. Collis and the Laveen Meadows HOA, which is the Respondent. This decision addresses Mr. Collis’s petition alleging the HOA violated its CC&Rs by improperly issuing citations related to his vehicle. The Findings of Fact detail that Mr. Collis’s vehicle was cited for being inoperable, having expired tags, and creating an unsightly condition defined as a nuisance under multiple CC&R sections. Ultimately, the Conclusions of Law state that Mr. Collis failed to meet his burden of proof to show the HOA violated any community documents or statutes, leading to the dismissal of his petition.

Case Participants

Petitioner Side

Jerry R. Collis (petitioner)

Respondent Side

Chad Gallacher (HOA attorney)
Maxwell & Morgan, P.C.
Counsel for Respondent Laveen Meadows HOA
Lisa Riesland (community manager)
Laveen Meadows HOA
Testified for Respondent

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Judy Lowe (Commissioner)
Arizona Department of Real Estate

Other Participants

f del sol (admin support)
Signed copy distribution notice

Warren R. Brown vs. Mogollon Airpark, Inc

Posted on October 18, 2018 by [email protected]

Case Summary

Case ID	18F-H1818029-REL-RHG, 18F-H1818045-REL, 18F-H1818054-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-18
Administrative Law Judge	Thomas Shedden
Outcome	The ALJ dismissed the petitions regarding the assessment increase (Dockets 029 and 054), ruling that A.R.S. § 33-1803(A)'s 20% cap applies only to 'regular assessments' and not special assessments. However, the ALJ ruled in favor of Petitioner Brown regarding late fees (Docket 045), finding that the statutory limit on late charges applies to all assessments, ordering the HOA to rescind the $25 fee and refund the filing fee.
Filing Fees Refunded	$1,500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Warren R. Brown	Counsel	—
Respondent	Mogollon Airpark, Inc.	Counsel	Gregory A. Stein; Mark K. Sahl

Alleged Violations

A.R.S. § 33-1803(A)
A.R.S. § 33-1803(A)
A.R.S. § 33-1803(A)

Outcome Summary

The ALJ dismissed the petitions regarding the assessment increase (Dockets 029 and 054), ruling that A.R.S. § 33-1803(A)'s 20% cap applies only to 'regular assessments' and not special assessments. However, the ALJ ruled in favor of Petitioner Brown regarding late fees (Docket 045), finding that the statutory limit on late charges applies to all assessments, ordering the HOA to rescind the $25 fee and refund the filing fee.

Why this result: For the assessment issues, the ALJ rejected the petitioners' interpretation that 'regular' refers to the approval process rather than the assessment type, finding that applying the cap to special assessments would violate principles of statutory construction.

Key Issues & Findings

Assessment Increase (Docket 029 – Brown)

Petitioner alleged the HOA violated the statute by increasing assessments by $325 (39.4%), exceeding the 20% limit.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Late Fees (Docket 045 – Brown)

Petitioner alleged the HOA charged a $25 late fee, which exceeds the statutory limit of the greater of $15 or 10%.

Orders: Respondent ordered to rescind the $25 late fee and refund the $500 filing fee.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Assessment Increase (Docket 054 – Stevens)

Petitioner alleged the $325 assessment increase violated the statutory 20% cap and that the HOA used deceptive accounting.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Video Overview

Audio Overview

Decision Documents

18F-H1818045-REL Decision – 666285.pdf

Uploaded 2026-04-24T11:12:44 (151.9 KB)

18F-H1818045-REL Decision – 672623.pdf

Uploaded 2026-04-24T11:12:49 (144.6 KB)

Administrative Law Judge Decision: Brown and Stevens vs. Mogollon Airpark, Inc.

This briefing document provides a comprehensive analysis of the consolidated administrative hearing between Petitioners Warren R. Brown and Brad W. Stevens and Respondent Mogollon Airpark, Inc. (the HOA). The proceedings focused on the legality of assessment increases, late fees, and interest charges under Arizona Revised Statutes (A.R.S.).

Executive Summary

The matter originated from three separate petitions consolidated for a hearing held on September 28, 2018. The primary disputes involved a 39.4% total increase in annual assessments and the imposition of late fees and interest rates that allegedly exceeded statutory limits.

The Administrative Law Judge (ALJ) reached a split decision. Regarding the assessment increase, the ALJ ruled in favor of Mogollon Airpark, Inc., determining that the statutory 20% cap applies only to "regular assessments" and not to "special assessments." Consequently, petitions 18F-H1818029-REL-RHG and 18F-H1818054-REL were dismissed. However, in petition 18F-H1818045-REL, the ALJ ruled in favor of Warren R. Brown, finding that the HOA’s $25 late fee violated A.R.S. § 33-1803(A), which limits such charges. The HOA was ordered to rescind the fee and reimburse the petitioner's $500 filing fee.

Case Overview and Financial Context

The following table outlines the financial changes implemented by Mogollon Airpark, Inc. in 2018 that led to the legal challenge:

Item	Previous Year (2017)	New Rate (2018)	Percentage Increase
Total Assessment	$825.00	$1,150.00	39.4%
Regular Portion	$825.00	$941.00 ($116 increase)	14.1%
Special Portion	$0.00	$209.00	N/A
Late Fee	Not Specified	$25.00	N/A
Interest Rate	Not Specified	18%	N/A

Analysis of Key Themes

1. Statutory Interpretation of "Regular Assessment"

The central legal conflict involved A.R.S. § 33-1803(A), which states that an HOA shall not "impose a regular assessment that is more than [20%] greater than the immediately preceding fiscal year's assessment" without member approval.

Petitioners' Argument: Brown and Stevens argued that "regular" refers to the process by which an assessment is passed (motion, second, and vote) rather than the type of assessment. They contended that since the total amount rose by 39.4%, it violated the statute.
Respondent's Argument: Mogollon argued that "regular assessment" is a specific category of assessment. They claimed the "special assessment" of $209 was a separate category not subject to the 20% cap.
Judicial Conclusion: The ALJ agreed with the Respondent, noting that if "regular" only referred to the process, the word would be rendered "trivial or void" in the statute. The ALJ found that the 14.1% increase in the "regular" portion was within the legal 20% limit.

2. Authority to Impose Special Assessments

A recurring theme was whether the HOA had the authority to issue a special assessment at all.

The "Trial Run" Concern: Mr. Stevens testified that the $209 assessment was perceived as a "trial run" to see if the HOA could successfully bypass statutory limits to fund projects not authorized by governing documents.
Contractual Basis: The Petitioners argued the Bylaws and CC&Rs only allow dues for operating expenses and approved reserve funds.
Judicial Conclusion: The ALJ noted that while the Petitioners questioned the HOA's authority to impose special assessments, the "single-issue" nature of the petitions limited the hearing's scope to whether the HOA violated A.R.S. § 33-1803(A).

3. Allegations of Accounting Impropriety

Both petitioners alleged that Mogollon’s treasurer engaged in deceptive accounting to justify the assessment increase.

Claims of Fabricated Shortfall: Mr. Brown alleged that accounting procedures were altered to show a loss of funds, despite the 2016 board leaving the treasury $200,000 better off. Mr. Stevens alleged the use of "two sets of books" to create a false need for higher dues, stating his belief that the HOA actually possessed in excess of $1 million.
Judicial Conclusion: The ALJ acknowledged these allegations but did not rule on the substance of the accounting practices, suggesting that civil courts might be better suited for such claims.

4. Late Fee and Interest Limits

A.R.S. § 33-1803(A) limits late payment charges to the greater of $15 or 10% of the unpaid assessment.

The Conflict: The HOA charged a $25 late fee. They argued that because the limit appeared in a section discussing "regular assessments," it did not apply to late fees on "special assessments."
Judicial Conclusion: The ALJ rejected this argument. The statute’s limit on late charges applies to "assessments" generally, not just "regular assessments." Therefore, the $25 fee was found to be a violation of the law.

Important Quotes and Context

"Courts will not place an absurd and unreasonable construction on statutes."

Context: Used in Conclusion of Law #4 to explain that the ALJ must interpret the term "regular assessment" in a way that makes logical sense and provides a fair result.

"Under Mogollon’s interpretation, it is necessary to add the word 'regular' where the legislature chose not to use it. This violates principles of statutory construction."

Context: The ALJ's reasoning in Conclusion of Law #10 regarding why the HOA could not charge a $25 late fee. The legislature omitted the word "regular" in the late fee clause, meaning it applies to all assessments.

"It is believed that the accounting was deliberately misleading and was intended to present an inaccurate picture of the HOA finances."

Context: A statement from Mr. Brown's original petition (Finding of Fact #18) regarding the alleged motive behind the 2018 assessment increase.

Decision Summary by Docket

Docket Number	Petitioner	Ruling	Order
18F-H1818029-REL-RHG	Warren R. Brown	Dismissed	Petition dismissed; Mogollon is the prevailing party.
18F-H1818054-REL	Brad W. Stevens	Dismissed	Petition dismissed; Mogollon is the prevailing party.
18F-H1818045-REL	Warren R. Brown	Sustained	Brown is the prevailing party. HOA must rescind the $25 late fee and pay Brown’s $500 filing fee.

Actionable Insights

Statutory Precision: Organizations must distinguish between "regular" and "special" assessments in their financial planning. While regular assessments are capped by a 20% annual increase under A.R.S. § 33-1803(A), special assessments may fall outside this specific cap (provided the HOA has the underlying authority to levy them).
Uniform Late Fee Limits: Regardless of the type of assessment (regular or special), late fees must strictly adhere to the statutory limit of $15 or 10% of the unpaid amount. Associations cannot bypass this cap by reclassifying the assessment type.
Burden of Proof: In administrative hearings, the petitioner bears the burden of proof by a "preponderance of the evidence." Technical arguments regarding statutory definitions require strong support from principles of statutory construction to succeed.
Jurisdictional Limits: The Office of Administrative Hearings may be limited to specific statutory violations. Allegations of complex financial fraud or "deceptive accounting" may require resolution in civil court rather than an administrative tribunal.

Legal Study Guide: Brown and Stevens v. Mogollon Airpark, Inc.

This study guide provides a comprehensive analysis of the consolidated administrative hearing involving Warren R. Brown, Brad W. Stevens, and Mogollon Airpark, Inc. It examines the legal interpretations of Arizona statutes regarding Homeowners Association (HOA) assessments and late fees.

I. Case Overview and Context

Administrative Context

Venue: Office of Administrative Hearings, Phoenix, Arizona.
Administrative Law Judge: Thomas Shedden.
Hearing Date: September 28, 2018.
Consolidated Matters: Three petitions (Docket Nos. 18F-H1818029-REL-RHG, 18F-H1818045-REL, and 18F-H1818054-REL) were consolidated into a single hearing because they shared common allegations regarding deceptive accounting practices and statutory violations.

Key Parties

Party	Role	Legal Representation
Warren R. Brown	Petitioner (029 and 045 matters)	Self (Pro Se)
Brad W. Stevens	Petitioner (054 matter)	Self (Pro Se)
Mogollon Airpark, Inc.	Respondent (HOA)	Gregory A. Stein, Esq. and Mark K. Sahl, Esq.

II. Central Legal Issues and Facts

Financial Assessments in Dispute

In 2018, Mogollon Airpark, Inc. implemented significant changes to its assessment structure. The previous year’s assessment was $825.

2018 Assessment Breakdown:

Regular Assessment Increase: $116 (a 14.1% increase).
Special Assessment: $209.
Total Increase: $325 (a 39.4% total increase).
New Fees: A $25 late payment fee and 18% interest on past-due accounts.

Statutory Focus: ARIZ. REV. STAT. § 33-1803(A)

The primary legal conflict centered on the interpretation of A.R.S. § 33-1803(A), which dictates:

Assessment Caps: An association cannot impose a "regular assessment" more than 20% greater than the preceding fiscal year's assessment without majority member approval (unless community documents require a lower limit).
Late Fee Limits: Charges for late payments are limited to the greater of $15.00 or 10% of the unpaid assessment.

III. Arguments and Interpretations

Interpretation of "Regular Assessment"

Petitioners' Position: Brown and Stevens argued that "regular assessment" refers to the process by which an assessment is created (regularly scheduled votes via motion and second). Therefore, the total $325 increase (39.4%) violated the 20% statutory cap.
Respondent's Position: Mogollon argued that "regular assessment" is a specific type of assessment distinct from a "special assessment." They maintained that since the regular portion only increased by 14.1%, they were in compliance with the law.
ALJ Ruling: The judge sided with Mogollon. Under principles of statutory construction, if "regular" referred only to the process, the word would be rendered "trivial or void." The judge determined the 20% cap applies specifically to the category of "regular assessments."

Interpretation of Late Fee Limits

Respondent's Position: Mogollon argued the $25 late fee was lawful because A.R.S. § 33-1803(A) should only apply to regular assessments.
ALJ Ruling: The judge sided with Petitioner Brown (045 matter). The statute limits late charges for "assessments" generally, not just "regular assessments." By using the broad term "assessments," the legislature intended the cap ($15 or 10%) to apply to all late fees. Mogollon's $25 fee was found to be in violation.

Allegations of Accounting Impropriety

Petitioners alleged that Mogollon's treasurer used "deceptive and nonstandard accounting methods," including "keeping two sets of books," to fabricate a financial shortfall. They argued this was a "plan" to justify the 39.4% increase despite the HOA allegedly having over $1 million in funds. The ALJ noted that civil courts might be better suited for such fraud allegations and did not address the substance of the accounting practices in the final decision.

IV. Short-Answer Practice Questions

What was the previous year's assessment amount for Mogollon Airpark?

Answer: $825.

According to A.R.S. § 33-1803(A), what is the maximum percentage a regular assessment can increase without a majority vote?

Answer: 20%.

Why did the ALJ dismiss the 029 and 054 matters regarding the $325 increase?

Answer: Because the petitioners failed to prove that the increase in the regular assessment (which was only 14.1%) exceeded the 20% limit, and the judge ruled the cap does not apply to special assessments.

In the 045 matter, why was the $25 late fee ruled unlawful?

Answer: A.R.S. § 33-1803(A) limits late fees for all "assessments" to the greater of $15 or 10%; Mogollon’s $25 fee exceeded these statutory limits.

What is the "standard of proof" required for petitioners in this administrative hearing?

Answer: A preponderance of the evidence.

What was the ALJ’s order regarding Mogollon’s obligation to Warren R. Brown in the 045 matter?

Answer: Mogollon was ordered to rescind the $25 late fee and reimburse Mr. Brown his $500 filing fee.

V. Essay Prompts for Deeper Exploration

The Nuances of Statutory Construction: Analyze the ALJ's reasoning in applying different interpretations to the word "regular" versus the word "assessment" within the same statute (A.R.S. § 33-1803(A)). Why did the presence of the word "regular" in the first half of the statute exclude special assessments from the 20% cap, while the absence of that word in the second half meant late fee limits applied to all assessments?
The Burden of Proof and Evidence: Discuss the role of the "preponderance of the evidence" standard in this case. Evaluate why Brad Stevens's 600+ pages of exhibits and testimony regarding the HOA's $1 million surplus were insufficient to win the 054 matter, given the ALJ's focus on matters of law over accounting disputes.
Jurisdictional Limits of Administrative Hearings: The ALJ noted that civil courts might be better suited for allegations of accounting improprieties and deceptive practices. Explore the limitations of an administrative tribunal versus a civil court in resolving complex financial disputes within an HOA.

VI. Glossary of Important Terms

A.R.S. § 33-1803(A): The Arizona Revised Statute governing HOA assessments and late fees.
CC&Rs (Covenants, Conditions, and Restrictions): The governing documents that serve as a contract between the HOA and its members.
Community Documents: The collective term for an association’s Bylaws, CC&Rs, and other governing rules.
Preponderance of the Evidence: The legal standard of proof where the evidence is of "greater weight" or has the "most convincing force," inclining a fair mind to one side of the issue.
Prevailing Party: The party in a legal proceeding that successfully proves its case or defends against an allegation; in this case, Mogollon prevailed in 029/054, while Brown prevailed in 045.
Regular Assessment: An assessment levied on a recurring basis to cover the association's standard operating expenses.
Single-Issue Petition: A simplified petition filed with the Department of Real Estate focusing on a single alleged violation of statute or community documents.
Special Assessment: A specific, often one-time assessment charged to members for expenses not covered by regular assessments (e.g., paving).
Statutory Construction: The process by which courts interpret and apply legislation, ensuring every word is given meaning and results are sensible rather than "absurd."

HOA vs. Homeowners: Decoding the Mogollon Airpark Legal Ruling on Dues and Fees

In the high-altitude enclave of Mogollon Airpark, a legal dogfight over three hundred dollars has redefined the boundaries of HOA power in Arizona. Homeowners Warren R. Brown and Brad W. Stevens took their Association to court, challenging a sudden 39.4% spike in annual costs and aggressive late penalties.

The resulting administrative law ruling serves as a vital case study in Arizona’s planned community statutes. By examining ARIZ. REV. STAT. § 33-1803, the court clarified exactly where a Board’s authority ends and where homeowner protections—specifically the "20% cap"—begin.

The $325 Question: When is an Increase Too High?

The conflict began in 2018 when Mogollon Airpark, Inc. (the HOA) implemented a $325 increase per household. For the petitioners, this felt like a clear-cut violation of state law, which generally requires a majority vote for significant cost hikes.

To evaluate the legality of the Board’s move, the court looked at the breakdown of the $325 increase relative to the previous year’s $825 total:

2017 Total Assessment: $825
2018 "Regular" Portion Increase: $116 (a 14.1% increase)
2018 "Special" Portion (Paving): $209
Total 2018 Increase: $325
Total Percentage Increase: 39.4%

Brown and Stevens argued that any increase exceeding 20% in a single year is a violation of § 33-1803(A). They contended that "regular" in the statute refers to the process—meaning any assessment passed through a standard board vote should be subject to the cap. Under their interpretation, the label "special" was merely a semantic trick to bypass homeowner voting rights.

The Legal Definition of "Regular": Why the HOA Won the Assessment Battle

Despite the jarring 39.4% jump, Administrative Law Judge (ALJ) Thomas Shedden dismissed the petitions regarding the dues increase. The decision hinged on the principle of "Statutory Construction"—how courts interpret the precise wording of legislation.

The ALJ determined that the term "regular" in § 33-1803(A) defines a specific type of assessment rather than the voting process used to enact it. If "regular" merely meant an assessment passed by a motion and a vote, the judge reasoned, the word would be "trivial" or "redundant" because almost all assessments are passed that way.

The court's interpretation established two critical precedents:

The Cap is Narrow: The 20% limit only protects homeowners from increases in standard annual operating dues.
Special Assessments are Separate: Because the legislature included "regular" in the assessment cap portion of the law but omitted it elsewhere, the court concluded that "special" assessments—such as the $209 paving fee—do not count toward the 20% threshold.

Since the $116 "regular" increase was only 14.1% of the previous year's total, the HOA stayed within the legal boundary.

The Late Fee "Gotcha": Why the Homeowners Won the Penalty Battle

While the homeowners lost the fight over dues, Petitioner Warren R. Brown secured a strategic victory regarding penalties in Docket No. 18F-H1818045-REL. The HOA had been charging a $25 late fee and 18% interest on past-due accounts, even for the contested paving assessment.

Here, the ALJ applied a symmetrical logic that worked against the HOA. The ALJ noted that while the statute specifies "regular assessments" when discussing the 20% cap, the section governing late charges refers broadly to all "assessments."

The statute limits late charges to the greater of:

$15.00
10% of the unpaid assessment

The HOA argued the $25 fee was valid because it applied to a special assessment. The ALJ rejected this, refusing to "read in" the word regular where the legislature had purposely left it out. Consequently, the HOA was ordered to rescind Mr. Brown's $25 fee and—most significantly—reimburse his $500 filing fee.

Transparency and Accounting: The Allegations Beneath the Surface

The legal battle revealed deep-seated distrust within the community. Petitioner Brad W. Stevens provided 45 pages of testimony and 600 pages of exhibits, painting a picture of a Board manufacturing a financial crisis.

The allegations included:

The "Two Sets of Books": Claims that the treasurer used deceptive accounting to hide the fact that the 2016 board actually left the treasury $200,000 better off than when they started.
Hidden Reserves: Allegations that the HOA held over $1 million in reserves, making the paving assessment unnecessary.
The "Trial Run": Mr. Stevens testified that the paving assessment was a "trial run" to see if the Board could successfully bypass the membership to fund future unauthorized projects.

While the ALJ acknowledged these concerns, he noted that complex accounting disputes and claims of "fabricated shortfalls" are better suited for a civil court rather than an administrative tribunal.

Conclusion & Key Takeaways for Homeowners

The consolidated ruling for Mogollon Airpark highlights the technical nature of HOA law and the high bar for homeowners seeking to overturn Board decisions.

Final Case Outcomes

Case Number	Petitioner	Primary Issue	Outcome
18F-H1818029-REL-RHG	Warren R. Brown	$325 Assessment Increase	Dismissed (HOA Won)
18F-H1818045-REL	Warren R. Brown	$25 Late Fee / 18% Interest	Prevailing Party (Brown Won)
18F-H1818054-REL	Brad W. Stevens	$325 Assessment Increase	Dismissed (HOA Won)

Lessons Learned

For Boards: Your late fee structures must strictly adhere to the $15 or 10% limit across all assessment types. There is no statutory loophole for "special" assessment penalties.
For Homeowners: The 20% cap is not a total shield. If your Board classifies a portion of a hike as a "special assessment" for a specific project like paving, the statutory cap likely won't protect you.
For Both: Procedural accuracy is paramount. A previous version of the 029 petition was dismissed simply because the homeowner failed to cite a specific Bylaw, CC&R, or statute. In the administrative arena, specific citations are the only way to get your day in court.

Homeowners are encouraged to audit their own association's fee and penalty structures against ARIZ. REV. STAT. § 33-1803. If your late fees exceed $15 or 10%, your HOA may be operating outside the law.

Case Participants

Petitioner Side

Warren R. Brown (petitioner)
Petitioner in docket Nos. 18F-H1818029-REL-RHG and 18F-H1818045-REL; appeared on his own behalf
Brad W. Stevens (petitioner)
Petitioner in docket No. 18F-H1818054-REL; appeared on his own behalf

Respondent Side

Gregory A. Stein (respondent attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Attorney for Respondent Mogollon Airpark, Inc.
Mark K. Sahl (respondent attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Attorney for Respondent Mogollon Airpark, Inc.

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Administrative Law Judge presiding over the consolidated hearing
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Recipient of the transmitted decision
Felicia Del Sol (clerk)
Office of Administrative Hearings
Transmitted the decision

Warren R. Brown vs. Mogollon Airpark, Inc(ROOT)

Posted on October 18, 2018 by [email protected]

Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.

Case Summary

Case ID	18F-H1818029-REL-RHG; 18F-H1818045-REL; 18F-H1818054-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-18
Administrative Law Judge	Thomas Shedden
Outcome	The ALJ found Mogollon did not violate ARS § 33-1803(A) concerning the 39.4% assessment increase (Matters 029 and 054), rejecting the Petitioners' interpretation of 'regular assessment.' However, Petitioner Brown prevailed in Matter 045, proving Mogollon violated the late charge limit of ARS § 33-1803(A) by charging a $25 late fee, resulting in a refund of his $500 filing fee and rescission of the fee.
Filing Fees Refunded	$1,500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Warren R. Brown	Counsel	—
Respondent	Mogollon Airpark, Inc.	Counsel	Gregory A. Stein, Esq.; Mark K. Sahl, Esq.

Alleged Violations

ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)

Outcome Summary

The ALJ found Mogollon did not violate ARS § 33-1803(A) concerning the 39.4% assessment increase (Matters 029 and 054), rejecting the Petitioners' interpretation of 'regular assessment.' However, Petitioner Brown prevailed in Matter 045, proving Mogollon violated the late charge limit of ARS § 33-1803(A) by charging a $25 late fee, resulting in a refund of his $500 filing fee and rescission of the fee.

Why this result: The assessment increase claims (029 and 054) were lost because the ALJ determined that interpreting 'regular assessment' as referring to the procedural method (motion, second, vote) would render the word 'regular' trivial or void in the statute.

Key Issues & Findings

Late payment charges limitation (045 Matter)

Petitioner Brown (045 matter) alleged the HOA violated ARS § 33-1803(A) by charging a $25 late fee. The ALJ found that the statutory limitation on late charges applies to all 'assessments,' not just 'regular assessments,' and found the $25 late charge was in violation.

Orders: Mogollon Airpark Inc. must rescind the $25 late fee assessed against Mr. Brown; Mogollon must pay Mr. Brown his filing fee of $500.00 within thirty days.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Assessment increase greater than 20% limit (029 Matter)

Petitioner Brown (029-RHG matter) argued the 39.4% increase violated the 20% cap because 'regular assessment' refers to the procedure for instituting any assessment. The ALJ rejected this interpretation, finding it rendered the word 'regular' void in the statute.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Assessment increase greater than 20% limit (054 Matter)

Petitioner Stevens (054 matter) alleged the HOA's $325 assessment increase was unlawful under the 20% cap. The ALJ dismissed the petition, applying the same statutory interpretation as in the 029 matter, holding that Mogollon's classification of the majority of the increase as a special assessment was valid under the statute.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Video Overview

Audio Overview

Decision Documents

18F-H1818029-REL-RHG Decision – 666285.pdf

Uploaded 2026-04-24T11:10:42 (151.9 KB)

18F-H1818029-REL-RHG Decision – 672623.pdf

Uploaded 2026-04-24T11:10:45 (144.6 KB)

Briefing Document: Brown and Stevens v. Mogollon Airpark, Inc.

Executive Summary

This document synthesizes the findings and conclusions of an Administrative Law Judge (ALJ) decision concerning three consolidated petitions filed by residents Warren R. Brown and Brad W. Stevens against their homeowners’ association, Mogollon Airpark, Inc. The core of the dispute revolves around a significant 2018 assessment increase and the legality of associated late fees under Arizona statute.

The central legal question was the interpretation of ARIZ. REV. STAT. section 33-1803(A), which limits an HOA’s ability to “impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year’s assessment.” The petitioners argued that the HOA’s total 39.4% increase violated this cap. The HOA contended the increase was comprised of a compliant “regular assessment” and a separate “special assessment” not subject to the cap.

The ALJ’s decision resulted in a split outcome:

• On the Assessment Increase: The judge ruled in favor of Mogollon Airpark, Inc. The petitions challenging the assessment increase were dismissed. The ALJ’s rationale was that statutory construction requires distinguishing between “regular” and “special” assessments, and the 20% cap applies only to the former.

• On the Late Fees: The judge ruled in favor of Petitioner Warren R. Brown. The HOA’s $25 late fee was found to be in violation of the statutory limit, which applies to “assessments” in general, not just “regular assessments.” The HOA was ordered to rescind the fee and reimburse the petitioner’s filing costs.

Underlying these specific legal challenges were broader allegations by the petitioners of deceptive accounting practices and financial mismanagement by the HOA’s treasurer, which they claimed were intended to create a false justification for the assessment increase. These allegations were noted but not adjudicated in this hearing.

I. Case Overview

The matter concerns a consolidated hearing held on September 28, 2018, at the Office of Administrative Hearings in Phoenix, Arizona. Administrative Law Judge Thomas Shedden presided over the case, which combined three separate petitions against the respondent, Mogollon Airpark, Inc.

• Petitioners: Warren R. Brown and Brad W. Stevens.

• Respondent: Mogollon Airpark, Inc.

• Docket Numbers:

◦ 18F-H1818029-REL-RHG (“029 matter”): Warren R. Brown, Petitioner

◦ 18F-H1818045-REL (“045 matter”): Warren R. Brown, Petitioner

◦ 18F-H1818054-REL (“054 matter”): Brad W. Stevens, Petitioner

II. Central Disputes and Allegations

A. The 2018 Assessment Increase (Matters 029 & 054)

The primary dispute centered on Mogollon Airpark’s 2018 assessment changes.

• Previous Assessment (2017): $825

• 2018 Increase: $325, representing a 39.4% total increase.

• HOA’s Breakdown of Increase:

◦ Regular Assessment Increase: $116 (a 14.1% increase over $825)

◦ Special Assessment: $209

• Legal Challenge: The petitioners alleged the total $325 increase violated ARIZ. REV. STAT. section 33-1803(A), which prohibits an HOA from imposing a “regular assessment that is more than [20%] greater than the immediately preceding fiscal year’s assessment” without member approval.

B. Late Fees and Interest Charges (Matter 045)

The second dispute, raised by Mr. Brown, concerned new penalties for late payments.

• New Charges: A $25 late fee and 18% interest on past-due accounts.

• Legal Challenge: Mr. Brown alleged these charges violated the same statute, which limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.” He presented an invoice showing he was charged a $25 late fee and $1.57 in interest.

C. Underlying Allegations of Financial Impropriety

Although the hearing’s scope was limited, the petitions were rooted in serious allegations of financial misconduct by the HOA. These claims formed the petitioners’ motive for challenging the assessments but were not the direct subject of the ALJ’s ruling.

• Core Claim: The petitioners asserted that Mogollon’s treasurer and others used “deceptive and nonstandard accounting methods,” including keeping two sets of books, to create the appearance of a financial shortfall.

• Alleged Purpose: This “fabricated shortfall” was allegedly used to convince the Board of Directors that a 39.4% dues increase was necessary.

• Petitioners’ Financial View: Mr. Stevens testified that he believed the HOA possessed funds in excess of $1 million and therefore did not require the increased assessment.

• ALJ’s Acknowledgment: The decision noted, “Considering the nature of Messrs. Brown and Stevens’s allegations, the civil courts may be better suited than an administrative tribunal to address the issues they raise. Regardless, the substance of their allegations was not addressed in this hearing.”

III. Arguments of the Parties

The central legal conflict hinged on the interpretation of the term “regular assessment” within the statute.

Petitioners’ Position (Brown & Stevens)

Respondent’s Position (Mogollon Airpark, Inc.)

Assessment Increase

The term “regular assessment” in § 33-1803(A) describes the process by which an assessment is instituted (i.e., by motion, second, and vote). Therefore, the entire $325 increase is a single assessment subject to and in violation of the 20% statutory cap. They further argued the HOA’s governing documents provide no authority to impose “special assessments.”

“Regular assessment” and “special assessment” are distinct types of assessments and industry terms of art. The 20% cap applies only to the regular portion. The $116 regular increase (14.1%) was compliant. The existence of the term “special assessment” in another statute (§ 33-1806) proves the legislature intended this distinction.

Late Fees

The 25latefeeisaclearviolationofthestatutorylimitof”15.00 or 10%.” The statutory text for late fees applies to “assessments” generally, not just “regular assessments.”

The statutory limit on late fees applies only to regular assessments. Since the late fee was charged on a special assessment, it did not violate the statute.

IV. Administrative Law Judge’s Decision and Rationale

The ALJ applied principles of statutory construction to arrive at a split decision, finding for the respondent on the main issue of the assessment increase but for the petitioner on the secondary issue of late fees.

A. Ruling on the Assessment Increase (Matters 029 & 054)

• Conclusion: The petitions filed by Mr. Brown and Mr. Stevens were dismissed. Mogollon Airpark, Inc. was deemed the prevailing party.

• Rationale: The judge concluded that the petitioners had not shown by a preponderance of the evidence that the statute was violated. Their definition of “regular assessment” as a procedural term was found to be inconsistent with principles of statutory construction. The judge reasoned that if “regular” simply meant the standard process of passing an assessment, the word would be redundant (“trivial or void”) because all assessments must follow that process. This interpretation supports the view that the legislature intended to differentiate between types of assessments, and that the 20% cap applies only to the “regular” type.

B. Ruling on Late Fees (Matter 045)

• Conclusion: Petitioner Warren R. Brown was deemed the prevailing party.

• Rationale: The judge rejected Mogollon’s argument that late fee limits apply only to regular assessments. The statutory text states, “Charges for the late payment of assessments are limited to…” without the “regular” qualifier. The ALJ determined that adding the word “regular” where the legislature chose to omit it would violate statutory construction principles. Therefore, the $25 late fee, being greater than the allowed $15 or 10%, was illegal.

V. Final Orders

The ALJ issued the following binding orders on October 18, 2018:

• ORDER FOR DOCKET NO. 18F-H1818029-REL-RHG (Brown vs. Mogollon):

◦ The petition is dismissed.

• ORDER FOR DOCKET NO. 18F-H1818045-REL (Brown vs. Mogollon):

◦ Petitioner Warren R. Brown is deemed the prevailing party.

◦ Mogollon Airpark Inc. must rescind the $25 late fee it assessed against Mr. Brown.

◦ Mogollon Airpark Inc. must pay Mr. Brown his filing fee of $500.00 within thirty days.

• ORDER FOR DOCKET NO. 18F-H1818054-REL (Stevens vs. Mogollon):

◦ The petition is dismissed.

Study Guide: Brown and Stevens v. Mogollon Airpark, Inc.

This study guide provides a review of the consolidated administrative hearing involving petitioners Warren R. Brown and Brad W. Stevens against the respondent, Mogollon Airpark, Inc. The case centers on disputes over Homeowners Association (HOA) assessments and fees under Arizona law.

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Short-Answer Quiz

Instructions: Answer the following questions in 2-3 sentences based on the information provided in the case documents.

1. Who were the primary parties involved in this consolidated matter and what were their respective roles?

2. What specific actions did Mogollon Airpark, Inc. take in 2018 that led to the legal petitions?

3. What was the total percentage increase of the 2018 assessment, and how did Mogollon Airpark, Inc. break down this increase?

4. Explain the petitioners’ main legal argument regarding the assessment increase and which statute they claimed was violated.

5. How did Mogollon Airpark, Inc. legally defend its decision to increase the assessment by more than 20%?

6. What was the central issue in the “045 matter” filed by Warren R. Brown?

7. Upon what legal principle did the Administrative Law Judge primarily rely to reach his conclusions on both the assessment increase and the late fee?

8. Why did the judge rule in favor of Mogollon Airpark on the assessment increase but in favor of Warren R. Brown on the late fee?

9. What were the underlying allegations made by the petitioners concerning Mogollon Airpark’s financial management that were not addressed in the hearing?

10. What was the final outcome and order for each of the three consolidated petitions (029, 045, and 054)?

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Answer Key

1. The petitioners were Warren R. Brown (dockets 029 and 045) and Brad W. Stevens (docket 054), who were members of the HOA. The respondent was Mogollon Airpark, Inc., the HOA being challenged. The matter was decided by Administrative Law Judge Thomas Shedden.

2. Mogollon Airpark, Inc. raised its 2018 assessment by a total of $325. It also instituted a new $25 fee for late payments and began charging 18% interest on past-due accounts.

3. The total increase of $325 over the previous year’s assessment of $825 constituted a 39.4% increase. Mogollon classified this increase as two separate parts: a $116 (14.1%) increase to the “regular assessment” and a $209 “special assessment.”

4. The petitioners argued that the total $325 increase violated ARIZ. REV. STAT. section 33-1803(A), which prohibits an HOA from imposing a “regular assessment” that is more than 20% greater than the previous year’s assessment. They contended that the term “regular assessment” refers to the standard process of levying an assessment (motion, second, vote), not a specific type of assessment.

5. Mogollon Airpark, Inc. argued that the 20% limit in section 33-1803(A) applies only to “regular assessments” and not to “special assessments,” which it claimed is a separate term of art in the industry. Since the increase to the regular assessment was only $116 (14.1%), it was below the 20% statutory threshold and therefore legal.

6. The central issue in the “045 matter” was Warren R. Brown’s allegation that Mogollon’s $25 late fee and 18% interest charge violated section 33-1803(A). The statute limits late charges to the greater of fifteen dollars or ten percent of the unpaid assessment.

7. The judge primarily relied on principles of statutory construction. This involved giving meaning to every word in the statute and not reading words into a provision where the legislature omitted them, which led to different interpretations of the statute’s clauses on assessments versus late fees.

8. The judge ruled against the petitioners on the assessment because their interpretation would make the word “regular” in the statute redundant. However, he ruled for Brown on the late fee because the statutory text limits charges on “assessments” in general, not just “regular assessments,” and to rule otherwise would require adding a word the legislature did not include.

9. The petitioners alleged that Mogollon’s treasurer engaged in deceptive and nonstandard accounting practices, including keeping two sets of books, to create a “fabricated shortfall.” They claimed this was done to falsely justify the need for the assessment increase, as the HOA actually had over $1 million in funds.

10. The petitions in the 029 matter (Brown) and 054 matter (Stevens) concerning the assessment increase were both dismissed. The petition in the 045 matter (Brown) concerning the late fee was successful; Mogollon was ordered to rescind the $25 fee and reimburse Brown’s $500 filing fee.

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Essay Questions

Instructions: Consider the following questions for a more in-depth analysis of the case. Formulate a comprehensive response based solely on the information in the provided legal decision.

1. Analyze the role of statutory construction in the Administrative Law Judge’s decision. How did the interpretation of the specific word “regular” and the general term “assessments” shape the final, divergent outcomes for the consolidated petitions?

2. Discuss the petitioners’ underlying allegations of deceptive accounting practices. Although not the central issue of the hearing, how did these claims frame the dispute, and why did the judge note that civil courts might be better suited to address them?

3. Compare and contrast the legal arguments presented by the petitioners and the respondent regarding the interpretation of ARIZ. REV. STAT. section 33-1803(A). Evaluate the strengths and weaknesses of each side’s position as described in the decision.

4. Trace the procedural history of the “029 matter,” from its initial filing and dismissal to the rehearing. What does this progression reveal about the procedural requirements for filing a successful petition with the Office of Administrative Hearings?

5. Evaluate the outcome of the consolidated hearing. Why was one petitioner successful on one claim while both were unsuccessful on another, despite the claims originating from the same set of actions by the HOA?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

The official, in this case Thomas Shedden, who presides over hearings at the Office of Administrative Hearings and issues decisions and orders.

ARIZ. REV. STAT. section 33-1803(A)

The specific Arizona statute at the center of the dispute. It limits HOA “regular assessment” increases to 20% over the prior year and caps late payment charges at the greater of $15 or 10% of the unpaid assessment.

Assessment

A fee imposed by an HOA on its members. The case distinguishes between a “regular assessment” (a recurring charge) and a “special assessment” (a one-time charge for a specific purpose).

Burden of Proof

The obligation of the petitioners, Messrs. Brown and Stevens, to prove their allegations against the respondent.

Consolidated Matter

The joining of multiple, separate legal petitions (in this case, 029, 045, and 054) into a single hearing because they involved the same parties and related issues.

Petitioner

A party who files a petition initiating a legal action. In this matter, Warren R. Brown and Brad W. Stevens were the petitioners.

Preponderance of the Evidence

The standard of proof required in this administrative hearing. It is defined as evidence with the most convincing force that inclines an impartial mind to one side of an issue over the other.

Respondent

The party against whom a petition is filed. In this matter, Mogollon Airpark, Inc. was the respondent.

Single-Issue Petition

A petition filed with the Department of Real Estate that is limited to a single allegation, which in the case of Mr. Stevens’s 054 matter required a $500 filing fee.

Statutory Construction

The legal process of interpreting and applying legislation. The judge used principles of statutory construction to determine the meaning of “regular assessment” and “assessments” in the relevant statute.

How One Word Created an HOA Loophole for a 40% Fee Hike—And How Another Word Gave a Homeowner a Key Victory

1.0 Introduction: The Dreaded HOA Letter

It’s the letter every homeowner dreads opening. A crisp envelope from the Homeowners Association lands in your mailbox, and inside is a notice that your mandatory fees are about to skyrocket. For a group of homeowners in Arizona’s Mogollon Airpark, this scenario became a reality when their HOA announced a staggering 39.4% increase in their annual assessments.

What followed was a legal battle that provides a fascinating and cautionary tale for every homeowner living under an HOA. The dispute, which pitted homeowners Warren Brown and Brad Stevens against Mogollon Airpark, Inc., didn’t hinge on fairness or financial need, but on the legal interpretation of a single word. This article distills the surprising and counter-intuitive lessons learned from their fight, revealing loopholes and legal technicalities that can make all the difference.

2.0 A 40% Fee Hike Can Be Legal Thanks to the “Special Assessment” Loophole

The core of the dispute was the massive fee hike. Mogollon Airpark, Inc. raised its 2018 assessment by $325 from the previous year’s $825—a 39.4% increase. This seemed to be a clear violation of Arizona law (ARIZ. REV. STAT. section 33-1803(A)), which explicitly prohibits an HOA from increasing a “regular assessment” by more than 20% in one year without a majority vote from members.

The HOA, however, employed a clever strategy. It split the $325 increase into two distinct parts:

• A $116 “regular assessment” increase, which amounted to a legal 14.1% hike.

• A separate $209 “special assessment.”

The HOA argued that the 20% statutory cap only applied to the “regular” portion of the increase, making their move perfectly legal.

The homeowners countered that this was a deceptive maneuver. They argued that the term “regular assessment” in the law refers to the process of creating an assessment (a motion, a second, and a vote), not a specific type of assessment. From their perspective, the entire 39.4% increase was a single action and was therefore illegal.

In a surprising ruling, the Administrative Law Judge sided with the HOA. The judge reasoned that if the homeowners’ interpretation was correct and all assessments followed the same “regular” process, then the word “regular” in the statute would be rendered “trivial or void.” By giving meaning to that single word, the judge affirmed that “regular assessments” and “special assessments” are different categories, and the 20% cap only applies to the former. This interpretation effectively creates a significant loophole for HOAs to bypass statutory limits and implement large fee increases.

3.0 The Devil Is in the Details: “Regular Assessment” vs. “Assessments”

While the HOA won the main argument over the 39.4% increase, they lost on a smaller but crucial point: late fees. Along with the assessment hike, the HOA instituted a new $25 late fee for overdue payments.

Homeowner Warren Brown challenged this fee, pointing to the same state law. He argued that the statute limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.” Since the new $25 fee exceeded this limit, it was a direct violation.

Emboldened by their victory on the assessment increase, the HOA extended its logic, arguing that since the late fee was applied to a special assessment, the statutory limit—which they claimed was intended for regular assessments—did not apply.

This time, the judge decisively ruled in favor of the homeowner. The judge highlighted a critical distinction in the law’s wording. The part of the statute limiting assessment increases uses the specific term “regular assessment.” However, the part of the law limiting late charges uses the broader, more general term “assessments.” The omission of the word “regular” was the key.

The judge’s reasoning was a masterclass in statutory construction:

This argument fails because the statute’s limit on late charges applies to “assessments,” not “regular assessments.” Under Mogollon’s interpretation, it is necessary to add the word “regular” where the legislature chose not to use it. This violates principles of statutory construction.

This outcome underscores the immense importance of precise legal language. The legislature’s choice to omit a single word in one clause of a law gave the homeowner a clear victory and held the HOA accountable.

4.0 Serious Allegations Don’t Guarantee a Day in Court

Underlying the homeowners’ legal challenge were serious allegations of financial misconduct. Mr. Brown and Mr. Stevens claimed the HOA treasurer used “deceptive and nonstandard accounting methods,” kept “two sets of books,” and created a “fabricated shortfall” to justify the assessment increase and “convince the Board that a 39.4% increase in dues was required.”

Surprisingly, none of these explosive allegations were addressed during the hearing. The reason for this is a crucial lesson in legal strategy. The homeowners had filed “single-issue petitions,” which legally limited the scope of the administrative hearing to one narrow question: did the HOA violate the specific statute governing assessment increases (ARIZ. REV. STAT. section 33-1803(A))? All other matters, including the allegations of accounting improprieties, were outside the hearing’s jurisdiction.

The judge explicitly noted this limitation in a footnote to the decision:

Considering the nature of Messrs. Brown and Stevens’s allegations, the civil courts may be better suited than an administrative tribunal to address the issues they raise. Regardless, the substance of their allegations was not addressed in this hearing.

This case is a powerful reminder that in law, the structure of your argument can be more important than the weight of your accusations. By filing a narrow petition, the homeowners guaranteed a hearing on that one issue but forfeited the chance to have their broader, more serious claims heard in that venue.

5.0 A Partial Victory Is Still a Victory

The final outcome of the consolidated case was decidedly mixed. The homeowners lost their primary challenge, and the court upheld the HOA’s $325 assessment increase.

However, Mr. Brown was officially deemed the “prevailing party” in his case regarding the illegal late fees. This was not just a moral victory; it came with a direct order from the judge. Mogollon Airpark Inc. was ordered to:

• Rescind the $25 late fee it assessed against Mr. Brown.

• Pay Mr. Brown back his $500 filing fee for the case.

While it wasn’t the total win they had hoped for, this outcome demonstrates that a single, well-prepared homeowner can successfully hold their HOA accountable for breaking the law, even on smaller matters. It proves that knowing the rules and persevering can lead to tangible results, forcing an association to correct its illegal actions and compensating the homeowner for the cost of the fight.

6.0 Conclusion: Know the Law, Word by Word

The case of Brown and Stevens vs. Mogollon Airpark is a potent lesson in how legal battles are won and lost in the margins. A single word—”regular”—opened a loophole for the HOA to impose a nearly 40% fee hike, while the deliberate absence of that same word in a later clause empowered a homeowner to strike back and win.

This case serves as a powerful reminder that when it comes to the laws governing your community, every word matters. It poses a vital question for all homeowners: are the protections you count on in state law as ironclad as you think, or could they evaporate based on the interpretation of a single adjective?

Case Participants

Petitioner Side

Warren R. Brown (petitioner)
Appeared on his own behalf
Brad W. Stevens (petitioner)
Appeared on his own behalf; presented testimony

Respondent Side

Gregory A. Stein (attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Counsel for Respondent Mogollon Airpark, Inc.
Mark K. Sahl (attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Counsel for Respondent Mogollon Airpark, Inc.

Neutral Parties

Thomas Shedden (ALJ)
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Felicia Del Sol (clerk)
Transmitted the decision

William Travis vs. The Val Vista Lakes Community Association

Posted on February 2, 2018 by [email protected]

Case Summary

Case ID	18F-H1817017-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-02-02
Administrative Law Judge	Thomas Shedden
Outcome	The Petitioner's petition, raising three issues concerning the HOA's election nominating process, was dismissed entirely. The Respondent was deemed the prevailing party.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	William Travis	Counsel	—
Respondent	The Val Vista Lakes Community Association	Counsel	Mark K. Sahl, Esq.

Alleged Violations

Bylaws Article VIII
Bylaws Article VIII; Bylaws Article IV, Section 1
ARIZ. REV. STAT. sections 33-1812(A), (A)(1), and (A)(2)

Outcome Summary

The Petitioner's petition, raising three issues concerning the HOA's election nominating process, was dismissed entirely. The Respondent was deemed the prevailing party.

Why this result: The Petitioner failed to meet the burden of proof on all issues. The ALJ found that the Nominating Committee acted within the authority granted by the Bylaws regarding deadlines and nominee selection discretion, and the relevant election statute (A.R.S. § 33-1812) was not applicable to the nomination process.

Key Issues & Findings

Nominating Committee disregarded a September 29, 2017 deadline by which parties were to submit applications to nominate themselves.

Petitioner alleged the Nominating Committee violated Article VIII by accepting applications after the September 29th administrative deadline, arguing the deadline was a 'term[], limitation[], or rule[] adopted by the Board of Directors'.

Orders: The claim was dismissed. The deadline was an administrative deadline set by management, not a rule adopted by the Board, and therefore the Committee did not violate Bylaws Article VIII by accepting applications late.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

Bylaws Article VIII

The Nominating Committee exceeded its authority by asking candidates questions that had the effect of imposing qualification requirements for the Board’s Directors that exceed those set out in the Bylaws.

Petitioner alleged that the Committee imposing questions (such as whether an applicant had filed a lawsuit against the Association) created unauthorized qualifications for the Board, violating the Bylaws.

Orders: The claim was dismissed. Bylaws Article IV Section 3 grants the Nominating Committee discretion to determine the number of nominations, and it was not unreasonable for the Committee to question applicants while exercising this explicit discretion.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

Bylaws Article VIII
Bylaws Article IV, Section 3

By failing to include on the election-ballot members who had submitted 'self-nominations,' the Committee violated election statutes.

Petitioner asserted that because members could not vote for the four applicants the Nominating Committee did not nominate, the Committee engaged in proxy voting, violating election requirements set forth in A.R.S. § 33-1812.

Orders: The claim was dismissed. Because Bylaws Article IV Section 3 requires nominations to be made by the Nominating Committee, nominations are not 'votes allocated to a unit' and ARIZ. REV. STAT. section 33-1812 is not applicable.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. sections 33-1812(A)
ARIZ. REV. STAT. sections 33-1812(A)(1)
ARIZ. REV. STAT. sections 33-1812(A)(2)

Analytics Highlights

Topics: HOA Election, Nominating Committee, Bylaws Enforcement, Director Qualifications, Administrative Deadline, Statutory Interpretation, Self-Nomination

Additional Citations:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
ARIZ. REV. STAT. section 33-1812

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Video Overview

Audio Overview

Decision Documents

18F-H1817017-REL Decision – 615818.pdf

Uploaded 2026-04-24T11:08:39 (125.4 KB)

Administrative Hearing Briefing: Travis v. The Val Vista Lakes Community Association

Executive Summary

This document provides a comprehensive analysis of the Administrative Law Judge Decision in case number 18F-H1817017-REL, concerning a petition filed by William Travis against The Val Vista Lakes Community Association. The core of the dispute revolves around the actions of the Association’s Nominating Committee during the process for the November 16, 2017 Board of Directors election.

Mr. Travis raised three primary allegations: 1) the Committee violated Association Bylaws by accepting candidate applications after a stated September 29, 2017 deadline; 2) the Committee exceeded its authority by interviewing candidates, thereby imposing qualification requirements beyond those stipulated in the Bylaws; and 3) the failure to include all applicants on the ballot constituted a violation of Arizona state statutes related to proxy voting.

The Administrative Law Judge, Thomas Shedden, dismissed Mr. Travis’s petition in its entirety. The decision found that Travis failed to prove the application deadline was a formal rule adopted by the Board, concluding it was an administrative deadline set by the management company. The Judge determined that the Committee’s actions, including interviewing applicants, were a reasonable exercise of the discretion explicitly granted to it by the Bylaws. Finally, the Judge ruled that the state statute cited by Travis applies to the casting of votes, not the internal nomination process, and was therefore inapplicable to the Committee’s actions. The Val Vista Lakes Community Association was deemed the prevailing party.

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Case Overview

Case Number

18F-H1817017-REL

Petitioner

William Travis

Respondent

The Val Vista Lakes Community Association

Hearing Date

January 26, 2018

Decision Date

February 2, 2018

Presiding Judge

Thomas Shedden, Administrative Law Judge

Testifying Parties

William Travis (on his own behalf); Simone McGinnis (Association’s on-site manager)

Petitioner’s Allegations

William Travis’s petition, as amended, centered on three specific issues concerning the Nominating Committee’s conduct for the November 16, 2017 Board election:

1. Violation of Application Deadline: The Committee disregarded a September 29, 2017 deadline for candidate applications. Travis contended that this deadline was a “term, limitation, or rule adopted by the Board,” and by accepting applications after this date, the Committee violated Bylaws Article VIII.

2. Exceeding Authority and Imposing Qualifications: The Committee exceeded its authority by interviewing and questioning applicants. Travis argued that this process had the effect of creating new qualification requirements for Board Directors, beyond the sole requirement of Association membership outlined in Bylaws Article IV. He asserted the Committee had no authority to ask any questions.

3. Statutory Violation of Voting Rights: By failing to place all members who submitted “self-nominations” on the official election ballot, the Committee violated ARIZ. REV. STAT. § 33-1812(A). Travis claimed this action was tantamount to proxy voting because it prevented members from voting for or against certain candidates.

Key Factual Findings

Election and Nomination Timeline

• August 17, 2017: The Board of Directors appoints Cheryl Peterson-McCoy as the Nominating Committee Chairperson.

• September 12, 2017: The Association’s management company emails residents, announcing three open Board positions and an application deadline of September 29, 2017, at 5:00 p.m.

• By September 29, 2017: Four applications are received. At this point, the members of the Nominating Committee (other than the Chairperson) have not yet been selected.

• After September 29, 2017: The Association accepts four additional applications, including one from Mr. Travis. No revised notice is sent to the membership about an extended deadline.

• October 5, 2017: Mr. Travis, then a Board member, makes an email motion to extend the application deadline to October 16, which is denied.

• October 19, 2017: The Board formally approves six members for the Nominating Committee. Mr. Travis’s subsequent motion at this meeting to extend the deadline fails for lack of a second.

Nominating Committee Actions and Rationale

• The Committee considered all eight applications submitted, including the four received after the initial deadline.

• The Committee scheduled and conducted interviews with all eight applicants.

• During interviews, applicants were asked questions including whether they had ever filed a lawsuit against the Association, were considering filing a lawsuit, or had any compliance violations.

• The Committee ultimately nominated four candidates to be placed on the ballot for the election. Of these four, two had applied by the September 29 deadline and two had applied after.

Association’s Position and Testimony

• Simone McGinnis, the Association’s on-site manager, testified that the September 29 deadline was not imposed by the Board but was an administrative deadline set by the management company to allow time for the nomination and ballot-printing process.

• The Association’s position, articulated at the November 16, 2017 Board meeting, is that the only way to get on the ballot is to be nominated by the Nominating Committee, although write-in candidates are permitted during the election.

• The Board acknowledged that it had only strictly adhered to the Bylaw requirement of using a Nominating Committee for the past two years, after thirty years of non-adherence.

• The Board’s attorney stated that the Committee members have a duty to act reasonably and that any member who disagrees with the Committee’s discretionary choices should seek to amend the bylaws.

Analysis of Governing Documents and Statutes

The judge’s decision rested on the interpretation of specific articles within the Association’s Bylaws and relevant Arizona state law.

Document/Statute

Relevant Provision

Application in this Case

Bylaws Article IV, Section 3

“Nominations for election to the Board of Directors shall be made by a Nominating Committee… The Nominating Committee shall make as many nominations… as it shall in its discretion determine…”

This article grants the Committee explicit discretion to select nominees. It does not provide for “self-nomination” or require the Committee to nominate all applicants.

Bylaws Article VIII

“no committee may take action which exceeds its responsibilities. Each committee shall operate in accordance with any terms, limitations, or rules adopted by the Board.”

Mr. Travis argued the deadline was a “rule adopted by the Board.” The court found no evidence to support this, concluding it was an administrative deadline.

Bylaws Article IV, Section 1

States that Board Directors must be members of the Association. It lists no other qualifications.

Mr. Travis argued that questioning candidates imposed extra qualifications. The court found this was part of the Committee’s discretionary selection process, not the imposition of new formal requirements.

ARIZ. REV. STAT. § 33-1812

Prohibits proxy voting and requires that ballots set forth each proposed action and provide an opportunity to vote for or against it.

The court determined this statute applies to “votes allocated to a unit” (i.e., the member’s vote) and not the nomination process itself, which is governed by the Bylaws.

Conclusions of Law and Final Order

The Administrative Law Judge made the following conclusions based on a preponderance of the evidence:

1. Deadline was Administrative: There was no substantial evidence showing the September 29, 2017 deadline was a formal rule adopted by the Board. Therefore, the Nominating Committee did not violate Bylaws Article VIII by accepting applications after this date.

2. Committee Acted Within its Discretion: The plain language of Bylaws Article IV, Section 3 requires nominations to be made by the Committee and grants it discretion. The concept of “self-nomination” is not supported by the Bylaws. It was not unreasonable for the Committee to question applicants as part of exercising its explicit discretion to select nominees.

3. State Voting Statute Not Applicable: The nomination process, as dictated by the Bylaws, is separate from the act of voting. Since ARIZ. REV. STAT. § 33-1812 governs “votes allocated to a unit,” it is not applicable to the Committee’s function of selecting nominees.

IT IS ORDERED that Petitioner William Travis’s petition is dismissed.

The decision is binding on the parties unless a rehearing is requested from the Commissioner of the Department of Real Estate within 30 days of the service of the order.

Study Guide: Travis v. The Val Vista Lakes Community Association

Short-Answer Quiz

Instructions: Answer the following questions in 2-3 complete sentences based on the provided source context.

1. Who were the primary parties involved in case number 18F-H1817017-REL, and what were their roles?

2. What were the three central issues that petitioner William Travis raised regarding the Board election held on November 16, 2017?

3. What was the petitioner’s argument concerning the September 29, 2017, application deadline set by the Association?

4. According to the Association’s on-site manager, Simone McGinnis, what was the origin and purpose of the September 29th deadline?

5. How did the petitioner claim the Nominating Committee exceeded its authority by questioning candidates?

6. What was the Association’s defense for the Nominating Committee’s practice of interviewing and questioning applicants?

7. What is the sole qualification required to serve on the Board of Directors, according to the Val Vista Lakes Community Association Bylaws?

8. How did the petitioner link the Nominating Committee’s failure to place all applicants on the ballot to a violation of ARIZ. REV. STAT. section 33-1812?

9. According to testimony during the November 16, 2017, Board meeting, how long had the Association been strictly adhering to the Bylaw requirement of using a Nominating Committee?

10. What was the final Order issued by Administrative Law Judge Thomas Shedden in this case?

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Answer Key

1. The primary parties were the Petitioner, William Travis, who brought the complaint, and the Respondent, The Val Vista Lakes Community Association, which was defending its actions. Mr. Travis represented himself, while the Association was represented by attorneys Mark K. Sahl and Nicholas C. Nogami.

2. The three issues raised by Mr. Travis were: (1) the Nominating Committee improperly disregarded the September 29th application deadline; (2) the Committee exceeded its authority by asking questions that effectively added new qualification requirements for Board members; and (3) the Committee’s failure to include all “self-nominations” on the ballot constituted a violation of Arizona state statutes on proxy voting.

3. Mr. Travis argued that the September 29th deadline was a “term, limitation, or rule adopted by the Board of Directors” under Bylaws Article VIII. Therefore, by accepting applications after this date, the Nominating Committee violated the Association’s own rules.

4. Simone McGinnis testified that the Board did not impose the deadline. Instead, it was an administrative deadline set by the Association’s management company to allow sufficient time for the Nominating Committee to review applications and have ballots printed.

5. Mr. Travis argued that by asking applicants questions, the Nominating Committee was effectively imposing qualification requirements beyond the single one set out in the Bylaws (being a member of the Association). He asserted the committee had no authority to ask any questions at all as part of its process.

6. The Association contended that questioning applicants was a reasonable exercise of the Nominating Committee’s discretion. This discretion is granted by the Bylaws, which state the Committee shall make as many nominations as it determines is appropriate.

7. According to Bylaws Article IV, Section 1, the only qualification required for an individual to serve on the Board of Directors is that they must be a member of the Association. No other qualifications are specified in the Bylaws.

8. Mr. Travis asserted that because members were not allowed to vote for or against the four applicants who were not nominated, the Committee effectively engaged in proxy voting. He argued this violated ARIZ. REV. STAT. section 33-1812, which requires that ballots provide an opportunity to vote for or against each proposed action.

9. During the meeting, the Board acknowledged that it had only been following the Bylaw requirement to use a Nominating Committee for the last two years. Prior to that, for approximately thirty years, strict adherence to this Bylaw had not been observed.

10. The Administrative Law Judge ordered that Petitioner William Travis’s petition be dismissed. The Judge also deemed the Respondent, The Val Vista Lakes Community Association, to be the prevailing party in the matter.

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Essay Questions

Instructions: The following questions are designed to test a deeper understanding of the case. Formulate a comprehensive response to each prompt using only the information and arguments presented in the source document.

1. Analyze the conflicting interpretations of the Nominating Committee’s role and authority as presented by William Travis and the Association. How did the Administrative Law Judge use the plain language of Bylaws Article IV, Section 3 to resolve this dispute?

2. Discuss the significance of the September 29, 2017 deadline. Evaluate the evidence and arguments presented by both parties regarding its legitimacy and binding nature, and explain the Judge’s reasoning for concluding it was an administrative deadline.

3. Explain William Travis’s legal argument that the Nominating Committee’s selection process constituted a form of proxy voting in violation of ARIZ. REV. STAT. section 33-1812. Detail the Judge’s conclusion on this matter and the legal reasoning used to determine the statute’s applicability.

4. Examine the concept of “discretion” as it applies to the Nominating Committee’s actions. Based on the hearing testimony, including the Board attorney’s explanation, what are the implied powers and limitations of this discretion?

5. The Judge determined that Mr. Travis failed to meet the “preponderance of the evidence” standard. Identify the key claims made by Mr. Travis and detail why the evidence he presented (or failed to present) was insufficient to prove his case on each of the three issues.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (Thomas Shedden in this case) who presides over administrative hearings, hears evidence, and makes legal findings and decisions.

Petitioner

The party who files a petition initiating a legal case. In this matter, the petitioner was William Travis.

Respondent

The party against whom a petition is filed and who must respond to the allegations. In this matter, the respondent was The Val Vista Lakes Community Association.

Bylaws

The formal rules and regulations governing the internal management of an organization, such as a homeowners’ association. They are considered a contract between the association and its members.

An acronym for Covenants, Conditions, and Restrictions, which are rules governing the use of real estate within a planned community. Mr. Travis initially alleged a violation of CC&R Article V, Section 3.

Nominating Committee

A committee, established by the Bylaws, responsible for nominating candidates for election to the Board of Directors. It consists of a Chairperson from the Board and two or more other persons.

Self-Nomination

The act of a member putting their own name forward for consideration for a Board position. The petitioner acknowledged that the Bylaws do not explicitly provide for self-nomination.

Burden of Proof

The legal obligation of a party in a trial to produce evidence that proves the claims they have made against the other party. In this case, the burden of proof was on Mr. Travis.

Preponderance of the Evidence

The standard of proof required in this case. It means the evidence presented is more convincing and has superior evidentiary weight than the evidence offered in opposition, inclining an impartial mind to one side over the other.

Proxy Voting

A form of voting where a member authorizes another person to vote on their behalf. ARIZ. REV. STAT. section 33-1812 prohibits this practice for community associations after the period of declarant control.

Prevailing Party

The party that wins the lawsuit. In this case, the Respondent Association was deemed the prevailing party upon the dismissal of the petition.

Your HOA Bylaws Might Not Mean What You Think: 3 Surprising Lessons from a Legal Showdown

Introduction: The Devil in the Details

Anyone who has ever sat through a contentious HOA annual meeting or received a violation notice for an overgrown flowerbed knows the feeling. You live in a community governed by rules, and you assume those rules operate on a shared understanding of common sense. But what happens when that common sense collides with the cold, hard text of your community’s governing documents?

A recent administrative law case in Arizona, Travis vs. The Val Vista Lakes Community Association, provides a fascinating and instructive look under the hood of HOA governance. The dispute reveals how the precise, technical wording of community bylaws can lead to surprising and counter-intuitive outcomes for residents. This case isn’t just about one community; it’s a masterclass for any homeowner. Here are the three most impactful lessons from the legal showdown.

1. A Deadline Isn’t Always a Deadline

The first major complaint from the petitioner, Mr. Travis, seemed straightforward. For an election with three open seats on the Board of Directors, the HOA’s Nominating Committee had accepted applications after a publicly announced deadline of 5:00 p.m. on September 29, 2017. Four applications arrived on time, but four more—including one from Mr. Travis himself—were accepted after the cutoff. In a delicious twist of irony, Mr. Travis was a sitting Board member who had twice attempted to have the Board formally extend the deadline, but both motions failed. A missed deadline is a missed deadline, right?

Not in this case. The judge dismissed the complaint entirely, drawing a critical distinction: the September 29th deadline was not a formal “term, limitation, or rule adopted by the Board.”

Testimony from the Association’s manager, Simone McGinnis, revealed the deadline’s true nature. It was merely an administrative deadline set by the management company for purely logistical reasons, such as allowing the Nominating Committee enough time to review applications and get the ballots printed.

The Lesson: In legal and governance contexts, the source of a rule is as important as the rule itself. An administrative guideline set by a third-party manager for convenience does not carry the same binding legal weight as a formal rule passed by the Board of Directors according to the procedures outlined in the bylaws.

2. “Nomination” Is a Process of Selection, Not Just Collection

Mr. Travis’s second argument centered on the Nominating Committee’s actions. The committee interviewed all eight applicants and asked them questions, including whether they had ever sued the Association or had any compliance violations. Mr. Travis contended that the committee had exceeded its authority. In fact, he argued that because four members had applied by the original deadline for the three open seats, the committee’s job was already done—it shouldn’t have even been formed, let alone vetted anyone. His position was that its role was simply to collect names, not to filter them.

This argument also failed. The judge found the committee acted squarely within its rights as defined by the Association’s Bylaws. Article IV, Section 3 explicitly grants the Nominating Committee the discretion to “make as many nominations for election to the Board of Directors as it shall in its discretion determine.” The judge concluded that questioning applicants was a reasonable part of exercising this discretion to select candidates.

Adding a fascinating historical twist, the Board admitted during a meeting that for thirty years prior, the Association had not strictly followed its own Bylaw requiring the use of a Nominating Committee, only beginning to do so in the last two years. A long-ignored rule had suddenly become the central mechanism for determining board candidacy.

While the committee must act reasonably—it couldn’t disqualify a candidate for having red hair, the Board’s attorney noted—it absolutely has the power to be selective. The core issue decided by the court was not how the committee used its discretion, but whether the Bylaws granted it discretion in the first place. The answer was a clear yes.

The Lesson: The term “Nominating Committee” can be misleading. Depending on your bylaws, it may not be a passive paper-pusher that forwards all names to the ballot. It can be an active gatekeeper empowered to interview, question, and ultimately select which members get a chance to be elected.

3. The ‘Right’ to Run for Your HOA Board Might Be a Myth

The final issue gets to the heart of homeowner assumptions. Mr. Travis argued for a right to “self-nominate”—his term for a system where any member could place themselves directly on the ballot. He claimed that by failing to include all applicants, the Association was engaging in a form of illegal proxy voting under Arizona state law.

The judge’s refutation of this idea was decisive. Mr. Travis himself acknowledged that the Bylaws contained no provision allowing a member to “self-nominate.” The court found that the only path to the ballot specified in the governing documents was via nomination by the Nominating Committee.

This created a critical procedural prerequisite. Because the Bylaws require nomination by the committee before a member can become a candidate, the state law governing voting (ARIZ. REV. STAT. § 33-1812) was legally inapplicable. The judge ruled that the act of nomination is not a “vote allocated to a unit.” In other words, if you don’t clear the prerequisite of being nominated, your right to be voted upon by the membership doesn’t even come into play.

The Lesson: This is a powerful and potentially shocking takeaway for many homeowners. Unless your community’s governing documents explicitly guarantee it, you may not have an inherent “right” to run for your HOA board simply by being a member in good standing. The power to decide who appears on the ballot can be exclusively vested in a small, appointed committee.

Conclusion: Read Your Bylaws. Really.

The case of Mr. Travis vs. Val Vista Lakes is a stark reminder that an HOA’s governing documents are a binding contract. In the courtroom of community governance, common-sense assumptions are legally irrelevant; only the written word matters. An administrative deadline may be toothless, a nominating committee may be a powerful gatekeeper, and the right to run for office may not be a right at all.

It all comes down to what is written in the documents. So, when was the last time you read your community’s governing documents from start to finish? The power structures they define might be very different from what you imagine.

Case Participants

Petitioner Side

William Travis (petitioner)

Respondent Side

Mark K. Sahl (respondent attorney)
Carpenter, Hazelwood, Delgado & Bolen, PLC
Nicholas C. Nogami (respondent attorney)
Carpenter, Hazelwood, Delgado & Bolen, PLC
Simone McGinnis (property manager)
Testified as a witness
Cheryl Peterson-McCoy (board member)
Nominating Committee Chairperson

Neutral Parties

Thomas Shedden (ALJ)
Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate

Jeff Lion vs. Riggs Ranch Meadows Homeowners Association

Posted on January 10, 2018 by [email protected]

Case Summary

Case ID	18F-H1817009-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-01-10
Administrative Law Judge	Thomas Shedden
Outcome	The Petitioner's petition was dismissed because he failed to appear or provide an authorized representative at the scheduled hearing, resulting in the Respondent being deemed the prevailing party.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Jeff Lion	Counsel	—
Respondent	Riggs Ranch Meadows Homeowners Association	Counsel	Nathan Tennyson

Alleged Violations

Article 8 of the Respondent’s CC&Rs

Outcome Summary

The Petitioner's petition was dismissed because he failed to appear or provide an authorized representative at the scheduled hearing, resulting in the Respondent being deemed the prevailing party.

Why this result: Petitioner failed to appear at the hearing scheduled at his request and failed to provide an authorized representative (as appearances are considered the practice of law under Arizona Supreme Court Rule 31).

Key Issues & Findings

Violation of CC&Rs

Petitioner Jeff Lion alleged that the Respondent violated Article 8 of the CC&Rs.

Orders: Petitioner Jeff Lion’s petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
Arizona Supreme Court Rule 31
ARIZ. REV. STAT. section 32-2199.02(B)
ARIZ. REV. STAT. section 32-2199.04
ARIZ. REV. STAT. section 41-1092.09

Analytics Highlights

Topics: Dismissal, Failure to Appear, Unauthorized Representation, HOA, CC&R

Additional Citations:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
Arizona Supreme Court Rule 31
ARIZ. REV. STAT. section 32-2199.02(B)
ARIZ. REV. STAT. section 32-2199.04
ARIZ. REV. STAT. section 41-1092.09

Video Overview

Audio Overview

Decision Documents

18F-H1817009-REL Decision – 611264.pdf

Uploaded 2026-04-24T11:08:16 (69.6 KB)

Briefing Document: Lion v. Riggs Ranch Meadows HOA (Case No. 18F-H1817009-REL)

Executive Summary

This document summarizes the Administrative Law Judge Decision in the case of Jeff Lion (Petitioner) versus Riggs Ranch Meadows Homeowners Association (Respondent). The Petitioner’s case, which alleged a violation of the Respondent’s CC&Rs, was dismissed due to the Petitioner’s failure to appear at the scheduled hearing on January 9, 2018.

The hearing had been rescheduled to this date at the Petitioner’s own request. On the day of the hearing, two witnesses for Mr. Lion appeared but were informed by the tribunal that they could not legally represent him as they were not licensed attorneys, a requirement under Arizona Supreme Court Rule 31. Because no authorized representative for the Petitioner was present, no evidence could be presented to support the claim. Consequently, Administrative Law Judge Thomas Shedden dismissed the petition and designated the Riggs Ranch Meadows Homeowners Association as the prevailing party.

Case Background and Procedural History

The matter originated from a petition filed by Jeff Lion against the Riggs Ranch Meadows Homeowners Association.

• Initial Allegation: Mr. Lion alleged that the Respondent violated Article 8 of its Covenants, Conditions, and Restrictions (CC&Rs).

• Notice of Hearing: On October 2, 2017, the Arizona Department of Real Estate issued a Notice of Hearing, initially scheduling the matter for November 29, 2017, at the Office of Administrative Hearings in Phoenix.

• Continuance: Mr. Lion filed a Motion to Continue the hearing, which was rescheduled for 9:00 a.m. on January 9, 2018, without objection from the Respondent.

Analysis of the January 9, 2018 Hearing

The proceedings on the rescheduled hearing date were pivotal to the case’s outcome.

• Petitioner’s Failure to Appear: Mr. Jeff Lion, the Petitioner, did not appear at the hearing at its scheduled time.

• Attempted Representation by Non-Attorneys: Two witnesses named by Mr. Lion were present. They informed the tribunal that Mr. Lion would not be appearing and that they intended to represent him.

• Tribunal’s Ruling on Representation: The tribunal advised the witnesses that they were legally prohibited from representing Mr. Lion. Citing Arizona Supreme Court Rule 31, the judge clarified that appearances at the Office of Administrative Hearings constitute the practice of law and require representation by an attorney licensed in Arizona. The witnesses confirmed they did not hold such licenses.

• Consequences of Non-Appearance: As there was no authorized representative present for the Petitioner, no evidence was taken. The judge noted that the hearing had been continued to that specific date at Mr. Lion’s request and proceeded to vacate the matter based on his failure to appear.

Legal Findings and Conclusions of Law

The Administrative Law Judge’s decision was grounded in established legal principles and procedural rules.

• Jurisdiction: The Arizona Department of Real Estate was confirmed to have authority over the matter pursuant to ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11.

• Burden of Proof: The decision reiterated that the party asserting a claim—in this case, Mr. Lion—carries the burden of proof. The standard required was a “preponderance of the evidence,” which is defined as evidence with “the most convincing force” sufficient to “incline a fair and impartial mind to one side of the issue rather than the other.”

• Core Rationale for Dismissal: The central conclusion of law was that Mr. Lion failed to meet his burden of proof. By not appearing at the hearing he had requested, and by not securing authorized legal representation, he “failed to present any evidence in support of his petition.”

Final Order and Implications

The decision, issued on January 10, 2018, formally concluded the administrative hearing process with a definitive outcome.

• Dismissal of Petition: The Administrative Law Judge ordered that “Petitioner Jeff Lion’s petition is dismissed.”

• Prevailing Party: The Respondent, Riggs Ranch Meadows Homeowners Association, was officially deemed the prevailing party in the matter.

• Post-Decision Options: The order is binding on the parties unless a rehearing is granted. A request for rehearing must be filed with the Commissioner of the Department of Real Estate within 30 days of the service of the order, as stipulated by ARIZ. REV. STAT. § 32-2199.04 and § 41-1092.09.

Key Parties and Representatives

Name/Entity

Contact/Representation Information

Petitioner

Jeff Lion

PO Box 1350, Selma, CA 93662

Respondent

Riggs Ranch Meadows Homeowners Association

Represented by Nathan Tennyson, Esq.

Respondent’s Counsel

Nathan Tennyson, Esq.

BROWN/OLCOTT, PLLC, 373 S. Main Ave., Tucson, AZ 85701

Administrative Law Judge

Thomas Shedden

Office of Administrative Hearings

Overseeing Body

Arizona Department of Real Estate

Commissioner: Judy Lowe

Study Guide for Administrative Law Judge Decision: Lion v. Riggs Ranch Meadows HOA

This study guide provides a review of the Administrative Law Judge Decision in the case of Jeff Lion v. Riggs Ranch Meadows Homeowners Association, Case No. 18F-H1817009-REL. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms found within the document.

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Short-Answer Quiz

Instructions: Answer the following questions in two to three sentences, based entirely on the provided legal decision.

1. Who were the petitioner and respondent in this matter, and what was the petitioner’s central allegation?

2. Why was the administrative hearing held on January 9, 2018, instead of the originally scheduled date?

3. Describe the events that occurred at the scheduled hearing time on January 9, 2018.

4. What specific rule was cited by the tribunal to prevent the petitioner’s witnesses from representing him?

5. What is the standard of proof for this matter, and which party had the burden of proof?

6. According to the decision, what was the direct consequence of the petitioner’s failure to have an authorized representative present at the hearing?

7. How does the legal document define the term “preponderance of the evidence”?

8. What was the final order issued by the Administrative Law Judge?

9. Who was identified as the “prevailing party” and why?

10. What option was available to the parties if they disagreed with the judge’s order?

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Answer Key

1. The petitioner was Jeff Lion, and the respondent was the Riggs Ranch Meadows Homeowners Association. Mr. Lion alleged that the respondent had violated Article 8 of its CC&Rs.

2. The hearing was originally set for November 29, 2017. It was rescheduled to January 9, 2018, because the petitioner, Mr. Lion, filed a Motion to Continue, to which the respondent did not object.

3. On January 9, 2018, the petitioner, Jeff Lion, did not appear for the hearing. Two witnesses appeared on his behalf and stated their intention to represent him, but they were not permitted to do so.

4. The tribunal cited Arizona Supreme Court Rule 31, which governs the practice of law. Since the witnesses were not licensed attorneys in Arizona, they were not legally permitted to represent Mr. Lion at the hearing.

5. The standard of proof is a “preponderance of the evidence.” The party asserting the claim, in this case, the petitioner Jeff Lion, had the burden of proof.

6. Because no authorized representative was present for Mr. Lion, no evidence was taken in support of his petition. This failure to present evidence was a key factor in the case’s dismissal.

7. The document defines “preponderance of the evidence” by quoting Black’s Law Dictionary as: “The greater weight of the evidence…that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

8. The final order was that Petitioner Jeff Lion’s petition is dismissed. The decision was issued on January 10, 2018.

9. The Respondent, Riggs Ranch Meadows Homeowners Association, was deemed the prevailing party. This was because Mr. Lion failed to present any evidence in support of his petition, leading to its dismissal.

10. The parties could request a rehearing pursuant to ARIZ. REV. STAT. section 32-2199.04. The request had to be filed with the Commissioner of the Department of Real Estate within 30 days of the service of the order.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (Thomas Shedden in this case) who presides over hearings at an administrative agency to resolve disputes.

ARIZ. ADMIN. CODE

The Arizona Administrative Code, a compilation of rules and regulations of Arizona state agencies. Section R2-19-119 is cited as establishing the standard of proof.

ARIZ. REV. STAT.

The Arizona Revised Statutes, which are the laws passed by the Arizona state legislature. Title 32, Chapter 20, Article 11 is cited as giving the Department of Real Estate authority.

Burden of Proof

The legal obligation of a party in a dispute to provide sufficient evidence to support their claim. In this case, the petitioner (Mr. Lion) had the burden of proof.

Covenants, Conditions, and Restrictions. These are rules governing a planned community or homeowners association. Mr. Lion alleged a violation of Article 8 of the Respondent’s CC&Rs.

Motion to Continue

A formal request made by a party to an administrative tribunal or court to postpone a scheduled hearing to a later date.

Office of Administrative Hearings (OAH)

The state agency where the hearing took place, which conducts hearings for other state agencies.

Petitioner

The party who files a petition or brings a legal action against another party. In this case, Jeff Lion.

Practice of Law

The act of representing others in legal proceedings. The decision states that appearances at the OAH are considered the practice of law and are restricted to licensed attorneys under Arizona Supreme Court Rule 31.

Preponderance of the Evidence

The standard of proof in this case. It is met when the evidence presented is more convincing and has greater weight than the evidence offered in opposition, inclining a fair mind to one side of the issue.

Prevailing Party

The party who wins a legal case or dispute. The Riggs Ranch Meadows Homeowners Association was deemed the prevailing party.

Rehearing

A second hearing of a case to re-examine the issues and the decision. The parties had 30 days to file a request for a rehearing.

Respondent

The party against whom a petition is filed. In this case, the Riggs Ranch Meadows Homeowners Association.

Tribunal

A body established to settle certain types of dispute. In this context, it refers to the Administrative Law Judge presiding over the hearing.

How One Homeowner Lost His Case Against His HOA Before It Even Began

Introduction: The David vs. Goliath Story You Haven’t Heard

Disputes with a Homeowners Association (HOA) are a common source of frustration. It often feels like a David vs. Goliath battle, pitting an individual against a structured organization with rules and resources. When faced with what they believe is an unfair application of those rules, some homeowners decide to fight back.

This was the situation for Jeff Lion, who filed a petition against his HOA, Riggs Ranch Meadows, alleging a violation of Article 8 of its Covenants, Conditions, and Restrictions (CC&Rs). But this story didn’t end with a dramatic debate over property rights. Instead, it was over before it started, derailed by a simple but fatal procedural misstep. This case offers three critical lessons for anyone considering a formal dispute, revealing how understanding the basic rules of the game is far more important than just believing you have a good argument.

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1. The Most Important Step is Showing Up

The central, decisive event of the case was a stunning failure in participation: the petitioner, Jeff Lion, did not appear at the hearing on January 9, 2018. The ultimate procedural irony? This was the exact hearing date that he himself had requested.

The contrast on that day could not have been starker. While Mr. Lion was a no-show for the fight he started, the HOA—the “Goliath” in this story—arrived fully prepared, represented by its attorney, Nathan Tennyson, Esq. The judge’s decision was swift and absolute. Because Mr. Lion did not appear, no evidence was taken, and his petition was dismissed entirely.

This outcome is rooted in a core legal principle known as the “burden of proof.” Simply put, the person making a claim is responsible for presenting evidence to support it. As the one who filed the petition, it was Mr. Lion’s job to prove his case. By failing to appear, he presented zero evidence and could not possibly meet this fundamental burden. The merits of his specific complaint about Article 8 were never even heard, all because of a self-inflicted failure to participate in the process he initiated on the day he chose.

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2. Not Just Anyone Can Speak for You in Court

In a surprising turn, while Mr. Lion was absent, his two named witnesses did appear at the hearing. They informed the judge that the petitioner would not be attending and that they intended to represent him in his absence.

The Administrative Law Judge immediately shut down their attempt. The reason highlights a crucial rule that trips up many non-lawyers: the witnesses were not licensed attorneys, and the law strictly forbids such representation. Appearances at these administrative hearings are legally considered “the practice of law.”

The court’s decision was based on an unambiguous rule, which it cited in its legal conclusions:

Appearances at the Office of Administrative Hearings are considered to be the practice of law. See Arizona Supreme Court Rule 31.

This is a counter-intuitive lesson for many. You might assume a trusted friend, family member, or knowledgeable witness could speak on your behalf. This case demonstrates that the legal system has rigid rules about who is authorized to provide representation. Good intentions and a willingness to help are not enough to grant someone the legal authority to act as your advocate in a formal hearing.

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3. “Winning” is About Tipping the Scale of Evidence

In administrative hearings, the standard for winning is called “a preponderance of the evidence.” This doesn’t mean proving your case beyond all doubt. Think of it like a scale. “Preponderance of the evidence” simply means you have to provide enough evidence to make the scale tip, even just slightly, in your favor.

The formal definition clarifies this concept of relative weight:

The greater weight of the evidence… sufficient to incline a fair and impartial mind to one side of the issue rather than the other.

Applying this standard to Mr. Lion’s case makes the outcome painfully clear. Since he failed to appear and no evidence was taken on his behalf, the “weight” of his evidence was zero. It was therefore impossible for him to tip the scale, no matter how strong his case might have been in theory. Because he presented nothing, Riggs Ranch Meadows was deemed the “prevailing party” by default. This demonstrates how the legal system is a structured process focused on evidence presented according to rules, not just on feelings or the theoretical rightness of a claim.

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Conclusion: The Rules of the Game Matter

The case of Jeff Lion provides a masterclass in legal procedure. The three key lessons are simple but absolute: you must show up to your own hearing, especially one you scheduled; only licensed attorneys can legally represent you; and you must present evidence to meet your burden of proof.

This case wasn’t ultimately about CC&Rs or neighborhood rules; it was about procedure. It serves as a stark reminder that before entering any formal dispute, the first question to ask isn’t “Am I right?” but “Do I understand the rules?”

Case Participants

Petitioner Side

Jeff Lion (petitioner)

Respondent Side

Nathan Tennyson (respondent attorney)
BROWN/OLCOTT, PLLC

Neutral Parties

Thomas Shedden (ALJ)
Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
Felicia Del Sol (ADRE transmission signatory)
LDettorre (ADRE recipient)
Arizona Department of Real Estate
AHansen (ADRE recipient)
Arizona Department of Real Estate
djones (ADRE recipient)
Arizona Department of Real Estate
DGardner (ADRE recipient)
Arizona Department of Real Estate
ncano (ADRE recipient)
Arizona Department of Real Estate

Thomas Barrs vs. Desert Ranch Homeowners Association

Posted on December 28, 2017 by [email protected]

Case Summary

Case ID	18F-H1817008-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2017-12-27
Administrative Law Judge	Thomas Shedden
Outcome	The Administrative Law Judge dismissed Thomas Barrs' petition against the Desert Ranch Homeowners Association. The Petitioner failed to show by a preponderance of the evidence that the Respondent violated ARIZ. REV. STAT. § 33-1805 in any of the remaining seven allegations related to record access. The Respondent was deemed the prevailing party.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Thomas Barrs	Counsel	—
Respondent	Desert Ranch Homeowners Association	Counsel	Brian Schoeffler

Alleged Violations

ARIZ. REV. STAT. § 33-1805

Outcome Summary

The Administrative Law Judge dismissed Thomas Barrs' petition against the Desert Ranch Homeowners Association. The Petitioner failed to show by a preponderance of the evidence that the Respondent violated ARIZ. REV. STAT. § 33-1805 in any of the remaining seven allegations related to record access. The Respondent was deemed the prevailing party.

Why this result: Petitioner failed to meet the burden of proof (preponderance of the evidence) on all claims. In several instances, the Respondent either cured any potential breach (Issue 2), timely complied (Issue 1), or was under no legal obligation to fulfill the request in the manner demanded (emailing records, Issues 3, 6, 7).

Key Issues & Findings

Alleged failure to provide records or copies, specifically via email (Issues 3, 6, 7)

Petitioner requested records (insurance policies, budget, EDC actions) be emailed. Respondent offered examination and purchase of copies. Petitioner declined the offers and blocked the attorney's emails. The ALJD determined the statute does not mandate emailing records.

Orders: Petitioner failed to prove Respondent violated A.R.S. § 33-1805 regarding requests for emailed documents, as the statute requires records to be made reasonably available for examination or purchase of copies, not emailed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

ARIZ. REV. STAT. § 33-1805

Analytics Highlights

Topics: records request, HOA records access, A.R.S. 33-1805, right to inspect, email delivery

Additional Citations:

ARIZ. REV. STAT. § 33-1805
ARIZ. REV. STAT. § 33-1812
ARIZ. REV. STAT. § 1-243
Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)
State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968)
City of Phoenix v. Donofrio, 99 Ariz. 130, 133, 407 P.2d 91, 94 (1965)

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Video Overview

Audio Overview

Decision Documents

18F-H181708-REL Decision – 608861.pdf

Uploaded 2026-04-25T09:56:45 (120.7 KB)

Briefing Document: Administrative Law Judge Decision in Barrs v. Desert Ranch Homeowners Association

Executive Summary

This document synthesizes the findings and conclusions of the Administrative Law Judge (ALJ) in case number 18F-H1817008-REL, involving Petitioner Thomas Barrs and Respondent Desert Ranch Homeowners Association (HOA). The central outcome of the December 1, 2017 hearing was the complete dismissal of Mr. Barrs’ petition. The ALJ determined that Mr. Barrs failed to prove by a preponderance of the evidence that the HOA violated Arizona Revised Statutes § 33-1805 regarding member access to association records.

The decision hinged on a key statutory interpretation: ARIZ. REV. STAT. § 33-1805 requires an HOA to make records “reasonably available for examination” and to provide copies upon request, but it does not obligate the association to email documents to members. The Judge found that the HOA’s offers to allow Mr. Barrs to inspect records in person were legally sufficient. The failure to access records was ultimately attributed to the petitioner’s own actions, including a self-initiated communication breakdown with a key Board member and a subsequent refusal of the HOA’s offers for in-person inspection. The Judge concluded that for each of the contested allegations, the HOA had either fulfilled its statutory duty, the requested records did not exist, or its attempts to provide access were declined by the petitioner.

Case Overview

Case Name

Thomas Barrs (Petitioner) v. Desert Ranch Homeowners Association (Respondent)

Case Number

18F-H1817008-REL

Arizona Office of Administrative Hearings

Administrative Law Judge

Thomas Shedden

Hearing Date

December 1, 2017

Decision Date

December 27, 2017

Central Allegation

The Petitioner alleged nine instances where the Respondent violated ARIZ. REV. STAT. § 33-1805 by failing to accommodate requests to inspect or receive via email various HOA records.

Final Disposition

The Petitioner’s petition was dismissed. The Respondent was deemed the prevailing party.

Analysis of Petitioner’s Allegations and Findings

The petition, filed on September 4, 2017, contained nine specific allegations of statutory violations by the HOA. These issues and the ALJ’s findings are detailed below.

Summary of Allegations

Request

Date of Request

Finding of Fact

View April 29, 2017 Board election documents

May 19, 2017

No violation; request fulfilled within statutory time limit.

View March 18, 2017 Board election documents

June 17, 2017

No violation; HOA cured any potential breach with offers to inspect, which were declined.

Email copies of insurance policies

July 11, 2017

No violation; HOA offered inspection, which fulfills statutory duty.

Insurance company phone number & policy number

Aug 26, 2017

No violation; Petitioner acknowledged receipt of information.

Email Secretary’s shorthand notes from March 18 meeting

July 11, 2017

No violation; the requested notes do not exist.

Email the annual budget

July 11, 2017

No violation; HOA offered inspection, which fulfills statutory duty.

Email written record of EDC actions after July 2016

July 11, 2017

No violation; HOA offered inspection, which fulfills statutory duty.

Email name of EDC chairperson

July 11, 2017

Withdrawn by Petitioner at the hearing.

Email list of Board meeting dates

July 11, 2017

Withdrawn by Petitioner at the hearing.

Detailed Findings by Issue

At the hearing, the Petitioner withdrew his allegations concerning the name of the EDC chairperson (Issue 8) and the list of past Board meeting dates (Issue 9).

• Issue 4 (Insurance Information): The Judge noted that Mr. Barrs “effectively acknowledged that he has received the insurance company’s phone number and the policy number.” No violation was found.

• Issue 5 (Shorthand Meeting Notes): The evidence demonstrated that no shorthand notes from the March 18, 2017 meeting exist. The Board had previously informed Mr. Barrs of this fact. Consequently, the Judge found no violation.

The petitioner requested to view documents related to the April 29, 2017, election via an email sent at 8:59 p.m. on Friday, May 19, 2017. The Judge determined that this request was effectively received on the next business day, Monday, May 22, 2017. Under the statute, the HOA had ten business days, until June 5, 2017, to fulfill the request. The HOA made the documents available for Mr. Barrs’ inspection on June 3, 2017, which was within the required timeframe. The decision also dismissed related claims by Mr. Barrs regarding a “late ballot” (which was actually a nomination petition) and “undeliverable ballots” (which did not exist as mailing envelopes had no return address). The Judge concluded the HOA did not violate the statute.

These issues center on a series of requests made in June and July 2017 and a significant communication failure initiated by the Petitioner.

Background: In March 2017, after HOA Board member Brian Schoeffler asked to be removed from a resident email thread, Mr. Barrs ceased all email communication with Mr. Schoeffler and blocked his email address, preventing him from receiving any emails sent by Mr. Schoeffler.

Timeline of Events:

• June 17, 2017: Mr. Barrs requested to view the March 18 election ballots (Issue 2). On June 19, Board President Catherine Overby informed him the materials were with Mr. Schoeffler and that he should contact him.

• July 11, 2017: Mr. Barrs emailed the Board (excluding Mr. Schoeffler) requesting that the insurance policies (Issue 3), annual budget (Issue 6), and EDC records (Issue 7) be emailed to him.

• July 12, 2017: Ms. Overby responded that she would forward the request to Mr. Schoeffler and later stated that Mr. Barrs should go to Mr. Schoeffler’s house to view the records. On the same day, Mr. Schoeffler emailed Mr. Barrs—an email Mr. Barrs did not receive—offering to meet and provide copies.

• July 25, 2017: Mr. Barrs informed the Board for the first time that he had blocked Mr. Schoeffler’s emails.

• July 28, 2017: Mr. Schoeffler sent another email, offering dates to meet and explaining that the statute required only that documents be made “reasonably available.”

• July 29, 2017: Mr. Barrs responded to the Board, stating he “will not stipulate to the preconditions” set by Mr. Schoeffler and concluding that the documents were “apparently” not available.

Finding: The Judge found that the Board responded to the July 11 requests in a timely manner (on July 12) and continued to try and accommodate them. However, Mr. Barrs “initially delayed matters by refusing to contact Mr. Schoeffler and he then declined Respondent’s offers.” For Issue 2, the Judge concluded that even if the HOA had initially failed to provide access within ten days, it had “cured its breach” with the subsequent offers of inspection on July 12 and July 28, which Mr. Barrs declined.

Central Legal Conclusions

The ALJ’s decision rested on several key conclusions of law regarding statutory interpretation and the burden of proof.

• Burden of Proof: Mr. Barrs, as the petitioner, bore the burden of proving the alleged violations by a preponderance of the evidence. The Judge concluded that he failed to meet this standard on all counts.

• Interpretation of ARIZ. REV. STAT. § 33-1805(A): This was the pivotal legal finding. The statute reads, in part:

• The ALJ concluded that this language does not obligate an HOA to email records to a member. The statutory requirement is satisfied when the association makes the records “reasonably available” for in-person inspection and allows the member to purchase copies (for a fee of not more than fifteen cents per page).

• Application to the Case: The HOA’s offer for Mr. Barrs to examine the requested documents at Mr. Schoeffler’s residence and to have copies made fulfilled its legal duty. Mr. Barrs’ insistence on receiving documents via email and his ultimate refusal of the in-person inspection offer were the reasons he did not gain access to the records.

Final Order

Based on the findings of fact and conclusions of law, the Administrative Law Judge issued the following order:

“IT IS ORDERED that Thomas Barrs’ petition is dismissed.”

The decision is binding on the parties unless a rehearing is filed with the Commissioner of the Department of Real Estate within 30 days of the service of the order.

Study Guide: Case No. 18F-H1817008-REL, Barrs v. Desert Ranch Homeowners Association

This study guide provides a comprehensive review of the Administrative Law Judge Decision in the case between Petitioner Thomas Barrs and Respondent Desert Ranch Homeowners Association. It covers the key facts, legal arguments, and the final judgment as detailed in the source document.

Quiz: Short-Answer Questions

Answer the following questions in 2-3 sentences, drawing exclusively from the provided case information.

1. Who were the primary parties involved in this case, and what were their respective roles?

2. What specific Arizona Revised Statutes did Thomas Barrs allege the Desert Ranch Homeowners Association had violated?

3. Describe the communication issue involving Mr. Barrs and Mr. Schoeffler that complicated the records requests made in July 2017.

4. What was the Judge’s finding regarding Mr. Barrs’ request for the Secretary’s shorthand notes from the March 18, 2017 meeting (Issue 5)?

5. Explain why the Judge determined that the Respondent’s handling of the May 19, 2017 request for election documents (Issue 1) was compliant with the statute.

6. According to the Judge’s Conclusions of Law, what does ARIZ. REV. STAT. section 33-1805 require of an association regarding requests for records? Does this include emailing them?

7. Which of his initial nine allegations did Mr. Barrs withdraw during the hearing?

8. How did Mr. Barrs respond to Mr. Schoeffler’s July 28, 2017 email, which offered dates to meet and review documents?

9. What is the standard of proof required in this matter, and which party bears the burden of meeting it?

10. What was the final Order issued by the Administrative Law Judge in this case?

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Answer Key

1. The primary parties were Thomas Barrs, the Petitioner, and the Desert Ranch Homeowners Association, the Respondent. Mr. Barrs filed a petition alleging violations by the HOA, while the HOA, represented by Brian Schoeffler, disputed the allegations.

2. Mr. Barrs alleged that the Desert Ranch Homeowners’ Association violated ARIZ. REV. STAT. sections 33-1805 and 33-1812. The case focused on nine specific instances where Mr. Barrs alleged the HOA failed to accommodate his requests for records under section 33-1805.

3. In March 2017, Mr. Schoeffler asked to be removed from a group email thread. In response, Mr. Barrs stopped sending emails to Mr. Schoeffler and also blocked incoming emails from him, which prevented him from receiving Mr. Schoeffler’s direct offers to inspect the requested documents.

4. The Judge found that the preponderance of the evidence showed that no shorthand notes from the March 18, 2017 meeting existed. The Board had informed Mr. Barrs of this fact shortly after he made his request, and therefore the Respondent did not violate the statute.

5. Mr. Barrs’ request was emailed after business hours on Friday, May 19, 2017, making its effective receipt date Monday, May 22. The Respondent fulfilled the request on June 3, 2017, which was within the ten-business-day timeframe required by law.

6. ARIZ. REV. STAT. section 33-1805 requires that an association’s records be made “reasonably available for examination” and that copies be provided upon request within ten business days. The Judge concluded that this statute does not legally obligate the Respondent to email copies of records.

7. During the hearing, Mr. Barrs withdrew his allegations regarding the request for the name of the EDC chairman (Issue 8) and the request for a list of Board meeting dates from the prior year (Issue 9).

8. On July 29, 2017, Mr. Barrs responded that he “will not stipulate to the preconditions” Mr. Schoeffler placed on his ability to review the documentation. He stated that “apparently” the documents were not available, effectively declining the offer to examine them.

9. The standard of proof is a “preponderance of the evidence.” The burden of proof was on the Petitioner, Mr. Barrs, to show that the Respondent committed the alleged violations.

10. The Administrative Law Judge ordered that Thomas Barrs’ petition be dismissed. The Respondent, Desert Ranch Homeowners Association, was deemed the prevailing party in the matter.

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Essay Questions

The following questions are designed for a more in-depth analysis of the case. Formulate a comprehensive essay response for each, citing specific facts from the decision.

1. Analyze the Administrative Law Judge’s interpretation of ARIZ. REV. STAT. section 33-1805. How did the distinction between making records “reasonably available” for examination versus the petitioner’s demand for them to be emailed shape the outcome of Issues 3, 6, and 7?

2. Discuss the concept of “preponderance of the evidence” as defined in the decision. Select two of Mr. Barrs’ allegations that the Judge found were not supported by a preponderance of the evidence and explain the specific facts that led to that conclusion.

3. Examine the communication breakdown between Thomas Barrs and Brian Schoeffler. How did the actions of both individuals (specifically, Mr. Schoeffler’s request in March and Mr. Barrs’ subsequent blocking of emails) directly contribute to the dispute and influence the Judge’s findings?

4. Trace the timeline and events surrounding the request to view ballots from the March 18, 2017 election (Issue 2). Explain the Judge’s reasoning for concluding that even if the Respondent had initially failed to grant access, it had “cured its breach.”

5. Evaluate the actions of the Respondent, Desert Ranch HOA, in response to Mr. Barrs’ multiple requests. Based on the Findings of Fact, construct an argument that the HOA made sufficient and reasonable efforts to comply with its statutory obligations.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (in this case, Thomas Shedden) who presides over administrative hearings, weighs evidence, and makes legal rulings and decisions.

ARIZ. REV. STAT.

Abbreviation for Arizona Revised Statutes, which are the codified laws of the state of Arizona. Sections 33-1805 and 33-1812 were central to this case.

Burden of Proof

The obligation on a party in a legal case to prove their allegations. In this matter, Mr. Barrs bore the burden of proof.

Conclusions of Law

The section of the decision where the Judge applies the relevant laws and legal principles to the established facts of the case to reach a judgment.

An apparent committee within the HOA (“Environmental Design Committee” is a common name, though not specified). Mr. Barrs requested written records of all actions taken by the EDC after July 2016.

Findings of Fact

The section of the decision that outlines the factual determinations made by the Judge based on the evidence presented at the hearing.

Hearing

The formal proceeding where the Petitioner and Respondent present their cases before the Administrative Law Judge. This hearing took place on December 1, 2017.

The final, legally binding ruling of the Judge. In this case, the order was to dismiss the Petitioner’s petition.

Petitioner

The party who initiates a legal action by filing a petition. In this case, Thomas Barrs was the Petitioner.

Preponderance of the Evidence

The standard of proof in this matter. It is defined as “The greater weight of the evidence… sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Respondent

The party against whom a petition is filed. In this case, the Desert Ranch Homeowners Association was the Respondent.

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This administrative law judge decision concerns a dispute between Petitioner Thomas Barrs and the Desert Ranch Homeowners Association (Respondent) before the Arizona Office of Administrative Hearings. Mr. Barrs alleged that the HOA violated Arizona Revised Statutes sections 33-1805 and 33-1812 on multiple occasions by failing to accommodate his requests to inspect or be emailed various association records, including election ballots, insurance policies, and financial documents. The findings of fact detail nine specific requests made by Mr. Barrs, some of which he later withdrew or were deemed satisfied. The Administrative Law Judge determined that Mr. Barrs failed to meet the burden of proof to show the HOA violated the statute, noting that the law only requires records be made “reasonably available” for examination and copying, not necessarily emailed. Ultimately, the judge dismissed Mr. Barrs’ petition, concluding that the Respondent was the prevailing party.

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Case Participants

Petitioner Side

Thomas Barrs (petitioner)
Appeared on his own behalf

Respondent Side

Brian Schoeffler (HOA attorney)
Desert Ranch Homeowners Association
Appeared for Respondent; also identified as a Board member
Catherine Overby (board president)
Desert Ranch Homeowners Association
Patrick Rice (board member)
Desert Ranch Homeowners Association

Neutral Parties

Thomas Shedden (ALJ)
OAH
Administrative Law Judge
Judy Lowe (Commissioner)
Arizona Department of Real Estate

Brian Sopatyk vs. The Lakeshore Village Condo. Association, Inc.

Posted on June 26, 2017 by [email protected]

Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.

Case Summary

Case ID	17F-H1716004-REL-RHG
Agency	ADRE
Tribunal	OAH
Decision Date	2017-08-10
Administrative Law Judge	Thomas Shedden
Outcome	The ALJ decision, certified as the final administrative decision, dismissed the Petitioner's claim after rehearing, finding that the Petitioner failed to prove the Association violated A.R.S. § 33-1260. The challenged $660 fee was determined to be a permissible working capital contribution under the CC&Rs, not a fee restricted by the statutory cap on resale disclosure services.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Brian Sopatyk	Counsel	Nathan Andrews
Respondent	The Lakeshore Village Condo. Association, Inc.	Counsel	Bradley R. Jardine

Alleged Violations

ARIZ. REV. STAT. section 33-1260

Outcome Summary

The ALJ decision, certified as the final administrative decision, dismissed the Petitioner's claim after rehearing, finding that the Petitioner failed to prove the Association violated A.R.S. § 33-1260. The challenged $660 fee was determined to be a permissible working capital contribution under the CC&Rs, not a fee restricted by the statutory cap on resale disclosure services.

Why this result: Petitioner failed to meet the burden of proof; the fee in question was determined to be a working capital fee/assessment governed by the CC&Rs and ARS § 33-1242(A)(2), and not subject to the limitation set forth in ARS § 33-1260.

Key Issues & Findings

Alleged excessive fee collection for resale disclosure/transfer services

Petitioner alleged the Association violated A.R.S. § 33-1260 by charging a $660 fee, which he argued exceeded the statutory maximum of $400 for resale disclosure/transfer services. The Association argued the $660 fee was a working capital contribution mandated by CC&R section 8.13 and was mislabeled, and therefore not subject to the statutory limitations of § 33-1260.

Orders: Brian D. Sopatyk’s petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1260
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
ARIZ. REV. STAT. § 32-2199.01
ARIZ. REV. STAT. § 32-2199.02
ARIZ. REV. STAT. § 33-1242(A)(2)

Analytics Highlights

Topics: HOA fee dispute, Working capital fee, Transfer fee, Resale disclosure, Statutory interpretation

Additional Citations:

ARIZ. REV. STAT. § 33-1260
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
ARIZ. REV. STAT. § 32-2199.01
ARIZ. REV. STAT. § 32-2199.02
ARIZ. REV. STAT. § 33-1242(A)(2)

Video Overview

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Decision Documents

17F-H1716004-REL-RHG Decision – 571793.pdf

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17F-H1716004-REL-RHG Decision – 580965.pdf

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17F-H1716004-REL-RHG Decision – 593042.pdf

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17F-H1716004-REL-RHG Decision – 593045.pdf

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17F-H1716004-REL-RHG Decision – 531040.pdf

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17F-H1716004-REL-RHG Decision – 540004.pdf

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Briefing: Sopatyk v. Lakeshore Village Condominium Association, Inc.

Executive Summary

This document synthesizes the findings and outcomes of an administrative legal case brought by petitioner Brian Sopatyk against The Lakeshore Village Condominium Association, Inc. The core of the dispute was Mr. Sopatyk’s allegation that the Association charged a “transfer fee” of $660 upon the sale of a condominium unit, in violation of Arizona Revised Statute (A.R.S.) § 33-1260, which caps fees for resale disclosure services at an aggregate of $400.

Following an initial hearing and a subsequent rehearing, the Administrative Law Judge (ALJ) consistently ruled in favor of the Association, dismissing Mr. Sopatyk’s petition on both occasions. The central finding was that the petitioner failed to prove a statutory violation by a preponderance of the evidence. The Association successfully argued that the disputed $660 charge was not a resale disclosure fee governed by A.R.S. § 33-1260, but rather a “working capital fee” authorized by its Covenants, Conditions, and Restrictions (CC&Rs). The Association admitted that this fee had been historically mislabeled as a “transfer fee,” an error it had since identified and corrected. The actual fee charged for resale disclosure documents was a separate, compliant $30 “statement fee.” The ALJ’s decision from the rehearing was certified as the final administrative decision in the matter on August 10, 2017.

Case Overview

Case Number

17F-H1716004-REL (Initial Hearing)
17F-H1716004-REL-RHG (Rehearing)

Jurisdiction

State of Arizona, Office of Administrative Hearings

Petitioner

Brian Sopatyk

Respondent

The Lakeshore Village Condominium Association, Inc.

Core Allegation

Violation of A.R.S. § 33-1260, which limits fees for resale disclosure services to a maximum of $400.

Final Outcome

Petition Dismissed. The Respondent was deemed the prevailing party.

Chronology of Legal Proceedings

March 2, 2015

The Association issues a disclosure statement for Mr. Sopatyk’s purchase, showing a $660 “transfer fee” and a $30 “statement fee.”

May 18, 2016

Prompted by Mr. Sopatyk, the Association’s Board discusses the fee structure. It concludes the $660 fee is a mislabeled “working capital fee” and not a statutory violation.

August 9, 2016

Mr. Sopatyk files a petition with the Arizona Department of Real Estate alleging the violation.

November 14, 2016

The initial administrative hearing is conducted before ALJ Thomas Shedden.

November 29, 2016

ALJ Shedden issues a decision dismissing Mr. Sopatyk’s petition.

December 13, 2016

The Commissioner of the Department of Real Estate adopts the ALJ’s recommendation, issuing a Final Order to dismiss the petition.

Post-Dec. 2016

Mr. Sopatyk requests a rehearing of the matter.

June 9, 2017

The rehearing is conducted, again before ALJ Thomas Shedden.

June 26, 2017

ALJ Shedden issues a new decision, once again dismissing Mr. Sopatyk’s petition.

August 10, 2017

With no modifying action from the Department of Real Estate, the ALJ’s June 26 decision is certified as the final administrative decision.

Core Dispute Analysis

The case centered on the interpretation and classification of two fees charged by the Association during the sale of Mr. Sopatyk’s condominium unit.

Petitioner’s Position (Brian Sopatyk)

• Allegation of Violation: Mr. Sopatyk alleged that the Association charged a “transfer fee” of $660, which directly contravened the $400 statutory maximum established by A.R.S. § 33-1260 for services related to resale disclosure.

• Evidence Presented: The petitioner submitted a March 2, 2015 disclosure form from the Association listing both a “660transferfee”anda”30 statement fee.” A HUD-1 disclosure statement for the purchase was also entered, showing the $660 “Transfer Fee” was split, with $330 paid from the buyer’s (Sopatyk’s) funds and $330 from the seller’s funds.

• Contradictory Testimony: The ALJ noted a discrepancy in the petitioner’s statements. The sworn petition stated the $660 fee was split between him and the seller, while his testimony at the rehearing claimed he “had in fact paid the entire $660 as part of the negotiated price.” The ALJ decision stated, “either Mr. Sopatyk’s sworn statement or his testimony must be false.”

• Requested Remedies: Mr. Sopatyk requested that the Association be ordered to comply with the statute, that refunds be paid to those who paid fees in excess of the statutory maximum, and that a civil penalty be imposed against the Association.

Respondent’s Position (The Lakeshore Village Condo. Assoc.)

• Distinction Between Fees: The Association’s central argument was that two separate and legally distinct fees were assessed:

1. A $30 Resale Statement Fee: This was the charge for preparing documents pursuant to A.R.S. § 33-1260 and was well within the $400 limit.

2. A $660 Working Capital Fee: This fee was authorized under a separate provision, Section 8.13 of the Association’s CC&Rs, which mandates an assessment from each new owner equal to two monthly installments to fund the Association’s working capital (reserve) fund.

• “Mislabeled” Fee: The Association acknowledged that the $660 working capital fee was incorrectly labeled as a “transfer fee.” Association Manager Amy Telnes testified that she received erroneous information from the prior manager and had been using the wrong label.

• Board Action and Corrective Measures: The minutes from the May 18, 2016 Board meeting show that the Board, after reviewing a legal opinion, concluded the issue was one of “labeling, not violating the statute.” The Board directed Ms. Telnes to perform an accounting and transfer all such fees collected into the Reserve Account. To prevent future confusion, the Board also voted to assess a single $400 transfer fee on all future transactions, with no other fees.

• Fund Allocation: Ms. Telnes testified that the $660 fee was deposited into the Association’s reserve fund, consistent with its purpose as a working capital contribution, while the $30 fee was the charge pursuant to A.R.S. § 33-1260(C).

Administrative Law Judge’s Findings and Rulings

ALJ Thomas Shedden presided over both the initial hearing and the rehearing, reaching the same conclusion in both instances.

Key Rulings and Legal Reasoning

• Burden of Proof: The ALJ established that Mr. Sopatyk, as the petitioner, bore the burden of proving the alleged violation by a “preponderance of the evidence.”

• Core Finding: The evidence demonstrated that the Association charged two distinct fees. The $30 fee was for document preparation under A.R.S. § 33-1260, while the $660 fee was a working capital assessment authorized by CC&R Section 8.13. The ALJ concluded that A.R.S. § 33-1260 was not applicable to the $660 fee.

• Conclusion on Violation: Based on the evidence, including the testimony of the Association manager and the board meeting minutes, the ALJ found that the $660 fee was mislabeled but was not collected for services related to resale disclosure. Therefore, Mr. Sopatyk did not meet his burden to show that the Association violated the statute.

• Rejection of Harm-Based Argument: The ALJ did not accept the Association’s argument that the claim should fail because Mr. Sopatyk did not personally pay over $400. The judge clarified that A.R.S. § 33-2199.01 “does not require this type of particularized harm, but rather applies to all statutory violations.”

• Dismissal of Petition: In both the November 29, 2016 decision and the June 26, 2017 decision, the order was to dismiss Mr. Sopatyk’s petition and deem the Association the prevailing party.

Final Disposition and Legal Status

The decision issued by ALJ Shedden on June 26, 2017, was transmitted to the Arizona Department of Real Estate. The Department had until August 1, 2017, to accept, reject, or modify the decision. As no action was taken by the deadline, the Office of Administrative Hearings issued a Certification of Decision of Administrative Law Judge on August 10, 2017. This certification established the ALJ’s decision as the final administrative decision of the Department of Real Estate in the matter.

Key Legal Citations and Definitions

• A.R.S. § 33-1260 (Resale of Units; Information Required): This Arizona statute governs the information a condominium association must provide to a prospective purchaser. It explicitly limits the fees an association can charge for these services:

• CC&R Section 8.13 (Transfer Fee and Working Capital Fund): This section of The Lakeshore Village Condominium Association’s governing documents provides the authority to collect a fee from new owners for a different purpose:

• Preponderance of the Evidence: The standard of proof required for the petitioner to prevail, defined in the legal decisions as:

Study Guide: Sopatyk v. The Lakeshore Village Condo. Association, Inc.

Short Answer Quiz

Instructions: Answer the following questions in 2-3 complete sentences, drawing exclusively from the information provided in the case documents.

1. Identify the petitioner and the respondent in this case, and state the core legal violation the petitioner alleged.

2. What specific fees were charged during the petitioner’s condominium purchase that became the central point of the dispute?

3. According to the Association, what was the true nature of the $660 fee, and how did it explain the “transfer fee” label on the disclosure documents?

4. What role did Amy Telnes, the Association manager, play in explaining the history of the disputed fee?

5. What actions did the Association’s Board take during its meeting on May 18, 2016, to address the petitioner’s concerns and correct its internal procedures?

6. Who held the burden of proof in this matter, and what was the legal standard required to meet that burden?

7. What was the official outcome of the initial administrative hearing held on November 14, 2016?

8. Why was a re-hearing conducted, and what was the final outcome of that hearing on June 9, 2017?

9. According to the re-hearing decision, there was a significant contradiction between the petitioner’s sworn petition and his later testimony. What was this contradiction?

10. What was the legal basis, according to the Association’s CC&Rs, for collecting the $660 working capital fee?

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Answer Key

1. The petitioner was Brian Sopatyk, and the respondent was The Lakeshore Village Condominium Association, Inc. Mr. Sopatyk alleged that the Association violated ARIZ. REV. STAT. section 33-1260 by charging a transfer fee in excess of the statutory maximum of $400.

2. The disputed fees were a $660 “transfer fee,” which was split between the buyer (Mr. Sopatyk) and the seller, and a separate $30 “statement fee” or “Resale Statement Fee.” The petitioner’s claim focused on the $660 fee being above the legal limit for resale disclosure services.

3. The Association argued the $660 fee was not a transfer fee for disclosure services but was a “working capital fee” authorized by its CC&Rs. It explained that the fee had been mislabeled as a “transfer fee” due to an error passed down from a previous property manager.

4. Amy Telnes testified that when she became the Association manager, she was incorrectly told the working capital fee was the transfer fee. She further testified that the $660 was deposited into the Association’s reserve fund, and the actual fee charged for disclosure under the statute was the separate $30 statement fee.

5. At the May 18, 2016, meeting, the Board concluded it was not in violation of the law but that its fee labeling was confusing. The Board directed Amy Telnes to perform an accounting and transfer all mislabeled fees into the Reserve Account and voted to assess a single, correctly labeled $400 transfer fee on all future transactions.

6. The petitioner, Brian Sopatyk, bore the burden of proof. The standard of proof required was a “preponderance of the evidence,” defined as evidence with the most convincing force that inclines an impartial mind to one side of an issue over the other.

7. Following the initial hearing, Administrative Law Judge Thomas Shedden found that Mr. Sopatyk had not shown by a preponderance of the evidence that the Association violated the statute. The judge ordered that Mr. Sopatyk’s petition be dismissed.

8. A re-hearing was conducted after Mr. Sopatyk requested one following the initial decision. The final outcome of the June 9, 2017, re-hearing was the same as the first: the Administrative Law Judge found the petitioner did not meet his burden of proof and ordered the petition to be dismissed.

9. In his sworn petition, Mr. Sopatyk stated that the $660 transfer fee was split between him and the seller. However, during his testimony at the re-hearing, he stated that he had in fact paid the entire $660 as part of the negotiated price of the unit.

10. The legal basis was Section 8.13 of the Association’s Declaration of Covenants, Conditions and Restrictions (CC&Rs). This section, titled “Transfer Fee and Working Capital Fund,” called for an assessment from each new owner of two monthly installments of the annual fee to be deposited into the working capital fund.

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Essay Questions

Instructions: The following questions are designed to test a deeper, more synthesized understanding of the case. Formulate a comprehensive response to each prompt, incorporating specific facts, legal arguments, and procedural details from the source documents.

1. Trace the complete timeline of the case, beginning with the filing of the petition. Include key dates of filings, hearings, decisions, and final certifications, and describe the significance of each event in the legal process.

2. Analyze the central legal argument of the Respondent, The Lakeshore Village Condominium Association. Explain how the distinction between a “transfer fee” under ARIZ. REV. STAT. section 33-1260 and a “working capital fee” under the Association’s CC&Rs was crucial to the Administrative Law Judge’s final decision.

3. Discuss the concept of “preponderance of the evidence” as it is defined and applied in this case. Explain why the petitioner, Brian Sopatyk, failed to meet this standard of proof in both the initial hearing and the re-hearing, citing specific evidence presented by the Association.

4. Evaluate the importance of the Association’s Board Meeting Minutes from May 18, 2016, as a piece of evidence. Detail the specific findings and resolutions from that meeting and explain how they were used to build the Association’s defense.

5. Examine the roles of the key individuals and entities in this administrative action. Describe the functions and contributions of Brian Sopatyk (Petitioner), Amy Telnes (Association Manager), Michael Cibellis (Association President), Thomas Shedden (Administrative Law Judge), and the Arizona Department of Real Estate.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

The official, in this case Thomas Shedden, who presides over hearings at the Office of Administrative Hearings, makes findings of fact and conclusions of law, and issues a decision.

ARIZ. REV. STAT. section 33-1260

The Arizona statute that requires a condominium association to provide certain disclosure documents to a prospective purchaser. It also limits the fee an association can charge for the preparation of these documents to an aggregate of four hundred dollars.

Burden of Proof

The obligation of a party in a legal case to prove their allegations. In this matter, the petitioner, Brian Sopatyk, bore the burden of proof.

An abbreviation for the Declaration of Covenants, Conditions and Restrictions. In this case, section 8.13 of the Association’s CC&Rs authorized the collection of a fee from new owners for a working capital fund.

Final Administrative Decision

The ultimate, legally binding decision in the administrative matter. In this case, the Administrative Law Judge’s decision became the final administrative decision after the Department of Real Estate did not act to accept, reject, or modify it within the statutory time limit.

HUD-1 Disclosure Statement

A document used in the petitioner’s property purchase that itemized all charges imposed upon a borrower and seller for a real estate transaction. It was used as evidence to show how the $660 “Transfer Fee” and $30 “Resale Statement Fee” were assessed and paid.

Petitioner

The party who files a petition initiating a legal action. In this case, Brian Sopatyk was the petitioner.

Preponderance of the Evidence

The standard of proof required in this administrative hearing. It is defined as “The greater weight of the evidence… that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”

Reserve Fund

An account maintained by the Condominium Association. The Association referred to its “working capital fund” as the Reserve Fund, into which the disputed $660 fees were deposited.

Respondent

The party against whom a petition is filed. In this case, The Lakeshore Village Condominium Association, Inc. was the respondent.

Statement Fee / Resale Statement Fee

A $30 fee charged by the Association for the preparation of disclosure documents. The Association argued this was the fee governed by ARIZ. REV. STAT. section 33-1260, which was compliant with the $400 statutory cap.

Transfer Fee

In the context of the petitioner’s allegation, a fee charged for resale disclosure services, limited to $400 by statute. In the context of the Association’s defense, this was the erroneous label applied to the working capital fee.

Working Capital Fee

A fee authorized by section 8.13 of the Association’s CC&Rs, assessed to each new owner to be deposited into the working capital fund (or Reserve Fund). The Association successfully argued that the disputed $660 fee was this type of fee, not one for resale disclosure.

How a $660 Fee Sparked a Legal Showdown: 5 Surprising Lessons from a Homeowner vs. HOA Dispute

We sign, we initial, we pay—assuming every line item on our closing documents is gospel. When buying a home in a condominium association, the stack of paperwork and list of fees can feel overwhelming. But what if one of those “standard” fees wasn’t standard at all?

For homeowner Brian Sopatyk, a single $660 charge from The Lakeshore Village Condominium Association wasn’t just a number; it was a thread he pulled that unraveled a surprising story of HOA governance, legal strategy, and the power of asking “why?” This post breaks down the five most impactful takeaways from a seemingly minor dispute that went all the way through a formal hearing and re-hearing.

1. A Simple Label Can Ignite a Legal Firestorm

A clerical error triggers a full-blown legal dispute.

The entire case hinged on a single, crucial mistake: the HOA mislabeled a “working capital fee” as a “transfer fee” on its disclosure forms.

Why was this one word so important? Because Mr. Sopatyk’s formal petition alleged that by charging a “$660 transfer fee,” the HOA violated Arizona statute 33-1260, which caps fees for resale disclosure services at a maximum of $400. On its face, the $660 charge looked like a clear violation of state law.

The Association’s manager, Amy Telnes, testified that when she took over her position, she was given erroneous information that the working capital fee was the transfer fee. As a result, the charge had been incorrectly labeled ever since. This simple administrative error was enough to trigger a formal petition to the Arizona Department of Real Estate, a full administrative hearing, and eventually, a re-hearing, proving how a small clerical mistake can escalate into a significant legal conflict.

2. In the Eyes of the Law, Substance Can Trump Form

Why the fee’s purpose mattered more than its name.

The Association’s core defense was that while the name of the fee was wrong, its purpose and authority were legitimate. The $660 charge, they argued, wasn’t for resale documents (the service capped by state law), but was a “working capital fee” authorized by an entirely different rule: the Association’s own Covenants, Conditions, and Restrictions (CC&Rs).

Specifically, Section 8.13 of the CC&Rs allowed for this assessment, with the funds designated for the Association’s reserve fund. This working capital fee, in contrast, was an assessment on the new owner as mandated by the CC&Rs to ensure the association’s financial health. The actual fee for the statutory disclosure documents was a separate, compliant $30 “Resale Statement Fee,” which was paid by the seller.

The Administrative Law Judge ultimately agreed. The fee’s underlying purpose and the HOA’s authority to collect it (its substance) were deemed more important than its incorrect name on the form (its form). This is a crucial lesson for any homeowner challenging an HOA: it’s not enough to find a mistake on a form. You must be prepared to argue against the underlying authority and purpose of the action itself.

3. You Can Lose the Battle but Win the War

How a dismissed case led to a major policy victory.

Perhaps the most counter-intuitive outcome is that although Mr. Sopatyk’s petition was dismissed, his actions were the direct catalyst for a significant and positive policy change by the HOA.

In a summary of the Association’s May 18, 2016, Board Meeting, which was entered as evidence, the judge noted that the Board reviewed the very issue Mr. Sopatyk had raised. Under the pressure of his legal challenge, they came to a powerful conclusion about their own system, determining it was “confusing and unfair.”

As a direct result of this internal review prompted by the dispute, the Board voted to simplify its process. It resolved to assess a single, clear transfer fee of $400 on all future transactions, eliminating the other confusing fees. This proves that even an unsuccessful legal challenge can be a powerful tool, forcing an organization to confront and correct its own problematic practices for the benefit of all future members.

4. The ‘Burden of Proof’ Is More Than Just a Phrase

What it really means to have to prove your case.

In both the original decision and the re-hearing, the judge repeatedly stated that Mr. Sopatyk, as the petitioner, bore the “burden of proof.” This legal standard was critical to the outcome. It meant he had to prove his claim by a “preponderance of the evidence,” which the court documents defined as:

The greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.

In this case, it meant Mr. Sopatyk’s job was to prove that the $660 fee was, more likely than not, an illegal charge for resale documents. The HOA’s defense—that it was a legally separate “working capital fee” that was simply mislabeled—created enough doubt that he couldn’t clear this hurdle.

5. A Small Contradiction Can Damage Credibility

When every word you say (and write) is on the record.

A fascinating detail appeared in the re-hearing decision, highlighting how every word matters in a legal proceeding.

There was a discrepancy in Mr. Sopatyk’s statements. His sworn petition, filed on August 9, 2016, stated the $660 fee was “split between the seller and the buyer.” However, during the hearing, he testified that he had “in fact paid the entire $660.”

The judge noted this contradiction directly in footnote 3 of the re-hearing decision, stating: “either Mr. Sopatyk’s sworn statement or his testimony must be false.” While not the deciding factor, this kind of inconsistency can subtly erode a petitioner’s standing. Remember the “burden of proof” from Takeaway 4? It requires convincing a judge to “incline a fair and impartial mind” to your side. Contradictions, even small ones, make that inclination much harder to achieve.

Conclusion: The Devil Is in the Details

This case is the perfect microcosm of community association disputes. It began with a clerical error (form), was adjudicated on intent (substance), was lost on a technicality (the burden of proof), yet resulted in a victory for transparency. Mr. Sopatyk may not have won his case, but he won a better system for his neighbors.

The ultimate lesson? In an HOA, the most powerful tool isn’t always a lawsuit—sometimes, it’s a magnifying glass. It leaves us with a thought-provoking question: When is it worth challenging the system for clarity and fairness, even if the outcome isn’t a clear ‘win’ on paper?

Case Participants

Petitioner Side

Brian Sopatyk (petitioner)
Represented himself at the initial hearing; sought rehearing
Nathan Andrews (petitioner attorney)
ASU Alumni Law Group
Jill M. Kennedy (petitioner attorney)
ASU Alumni Law Group
Judy Sopatyk (petitioner's wife)
Co-purchaser of the condominium unit,
Chance Peterson (petitioner attorney)
ASU Alumni Law Group

Respondent Side

Bradley R. Jardine (HOA attorney)
Jardine Baker Hickman & Houston
Amy Telnes (property manager/witness)
The Lakeshore Village Condo. Association, Inc.
Association manager who testified,
Michael Cibellis (Association president/witness)
The Lakeshore Village Condo. Association, Inc.
Testified at the rehearing

Neutral Parties

Thomas Shedden (ALJ)
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Abby Hansen (HOA Coordinator)
Contact for requests for rehearing
Greg Hanchett (Interim Director)
OAH
Signed the Certification of Decision,

Other Participants

Rosella J. Rodriguez (administrative staff)
Administrative staff for transmission/mailing,