Case ID 18F-H1818052-REL involves a dispute between Petitioner Lawrence M. Stewart and Respondent Canyon Gate Condominium Association, Inc. [1, 2]. The key facts of the case center on unauthorized changes Stewart made to the common or limited common areas around his condominium unit [3, 4]. After receiving notice from the Association's counsel that he was in violation of section 5.1 of the CC&Rs, Stewart, who was a Board member at the time, submitted a formal request for a variance [3-6]. During a Board meeting on February 18, 2018, Stewart resigned from his position, sensing that the other two Board members had already made up their minds against him [7, 8]. Following his resignation, the remaining Board members voted to deny his variance request and ordered him to restore the property to its original condition, citing concerns that approving the request would open a "Pandora’s Box" of similar demands from other unit owners [7-10].

The main issue raised by Stewart in his petition was an allegation that the Association violated Section 5.4 of the Bylaws [11, 12]. He claimed the Board did not act in good faith when evaluating his request, arguing that Board member David Larson was biased against him and that he was treated unfairly because other non-conforming units existed without variance approvals [13-17]. The Association countered that Section 5.4 is an indemnification clause designed to protect Board members from liability, rather than a provision that imposes an actionable duty upon them [14, 16, 18, 19]. Stewart acknowledged that this section acts as a "shield" and not a "sword," but cited it because it was the only governing document that included a "good faith" requirement [14, 16, 20, 21].

In the final outcome, Administrative Law Judge Thomas Shedden ruled in favor of the Association [22, 23]. The judge concluded that Section 5.4 does not impose a duty on the Board members, but merely protects them from liability if they act in good faith [24-27]. Furthermore, the judge determined that Stewart failed to prove by a preponderance of the evidence that the Board lacked good faith, harbored bias, or treated him unfairly [9, 10]. The judge specifically noted that the Board's desire to avoid opening a "Pandora’s Box" of variance requests was a reasonable position for a condominium association to take [9, 10]. Ultimately, Stewart's petition was dismissed on September 14, 2018, and this dismissal was upheld following a rehearing on January 17, 2019 [22, 23, 25, 28].