The Administrative Law Judge denied the petition, finding that the HOA Board had the authority under the CC&Rs and related documents to remove non-Board ARC members and appoint itself to perform the functions of the ARC, thus validating its approval of the homeowner's detached garage application.
Why this result: The Petitioner failed to establish by a preponderance of the evidence that the Respondent violated CC&Rs §§ 3.2 or 7.7. The Board, having assumed the developer's rights, was authorized to remove and appoint ARC members.
Key Issues & Findings
Alleged violation of CC&Rs regarding ARC dissolution and architectural approval authority.
Petitioner alleged that the HOA Board violated CC&Rs §§ 3.2 and 7.7 by dissolving the ARC and then acting as the ARC to approve a modification (detached garage) for a homeowner.
Orders: Petitioner's petition was denied because he failed to establish that CC&Rs §§ 3.2 or 7.7 prohibited the Respondent HOA from replacing non-Board ARC members, appointing its own members to act as the ARC, or approving the detached garage application.
Administrative Law Judge Decision Briefing: Dwight vs. Whisper Mountain HOA
Executive Summary
This document summarizes the Administrative Law Judge (ALJ) decision in case number 19F-H1918027-REL, concerning a dispute between homeowner N. Wayne Dwight, Jr. (“Petitioner”) and the Whisper Mountain Homeowners Association (“Respondent”). The Petitioner alleged that the HOA Board violated the community’s Covenants, Conditions, and Restrictions (CC&Rs) by suspending the Architectural Review Committee (ARC) and subsequently approving a homeowner’s construction application.
The ALJ denied the petition in its entirety, finding that the HOA Board acted within its authority. The decision established that upon the departure of the original developer (the “Declarant”), the Board inherited the Declarant’s full rights and responsibilities, including the power to both appoint and remove members of the ARC. The Judge explicitly rejected the Petitioner’s argument that ARC members held lifetime appointments, deeming such an interpretation contrary to the democratic principles of HOA governance. Consequently, the Board’s decision to remove the non-Board ARC members and appoint itself to serve as the ARC was ruled a valid exercise of its powers, and its subsequent approval of the construction application was not a violation of the CC&Rs.
Case Overview
Entity
Petitioner
N. Wayne Dwight, Jr. (Homeowner and former ARC member)
Respondent
Whisper Mountain Homeowners Association (HOA)
Adjudicator
Administrative Law Judge Diane Mihalsky
Case Number
19F-H1918027-REL
Hearing Date
January 14, 2019
Decision Date
January 29, 2019
Core Allegation
The Petitioner alleged that the Respondent’s Board violated two sections of the CC&Rs:
1. § 7.7 (Improvements and Alterations): By approving a homeowner’s application to build a detached garage on September 19, 2018, without the approval of a properly constituted ARC.
2. § 3.2 (Appeal): By creating a situation where the body making an architectural decision (the Board acting as the ARC) is the same body that would hear an appeal of that decision, rendering the appeal process meaningless.
This was based on the Petitioner’s central claim that the Board’s action on August 6, 2018, to “dissolve” or “suspend” the ARC was a violation of the governing documents.
Key Factual Background & Timeline
• Prior to 2015: The developer, VIP Homes (“Declarant”), establishes the ARC as required by the CC&Rs.
• 2015: The Declarant turns over control of the HOA to the resident-elected Board of Directors.
• March 15, 2016: The Board adopts an ARC Charter, which explicitly states: “The right to appoint and remove all appointed [ARC] members at any time is hereby vested solely in the Board.” The Petitioner is appointed as one of three non-Board members to the ARC.
• 2017 or 2018: A proposed amendment to the CC&Rs to formally replace references to “Declarant” with “Board” or “Association” is not adopted by the general membership.
• July 17, 2018: The ARC meets to consider a detached garage application from homeowners Mark and Connie Wells. The meeting is contentious, with the Petitioner expressing doubts about the ARC’s authority to grant a variance from city setback requirements. The meeting adjourns abruptly after the applicant allegedly “verbally threatened the committee.”
• August 6, 2018: The HOA Board meets and passes a motion “to suspend the ARC committee for 60 days until guidelines/expectations are clarified.” The motion states that in the interim, the Board will review and approve all ARC submissions.
• August 24, 2018: The Board sends a letter to the non-Board ARC members, including the Petitioner, informing them of the 60-day suspension.
• September 17, 2018: The Board meets and approves a revised application from the Wells, which now aligns with City of Mesa code.
• September 19, 2018: The Board, formally acting as the ARC, reviews and approves the Wells’ revised application.
• October 22, 2018: The Petitioner files his complaint with the Arizona Department of Real Estate.
• November 19, 2018: The Board adopts a “Resolution Regarding the ARC” to clarify its position. The resolution states the Board had “(i) temporarily removed the current members of the [ARC] (via a suspension) and (ii) chose to act and serve as the current [ARC].” It also formally ratifies the approval of the Wells’ garage.
Central Arguments Presented
Petitioner’s Position (N. Wayne Dwight, Jr.)
• Limited Board Authority: The CC&Rs (§ 3.4) grant the Declarant the “sole right to appoint and remove” ARC members. After the Declarant’s departure, this section states that members “shall be appointed by the Board.” The Petitioner argued this only conferred the power to appoint, not to remove.
• Failed Amendment: The failure of the membership to amend the CC&Rs to explicitly grant the Board the Declarant’s powers proves that the Board does not possess the power of removal.
• Lifetime Appointments: The Petitioner argued that once appointed, ARC members could only be removed for specific cause (e.g., moving out of the community, incapacitation) and were otherwise entitled to serve for life.
• Improper ARC Suspension: The Board’s action to suspend the committee was a violation of the CC&Rs, as the Board lacked the authority to do so.
• Invalid Approval: Because the ARC was improperly suspended, the Board’s subsequent approval of the Wells’ application violated § 7.7, which requires ARC approval for all alterations.
• Meaningless Appeals: If the Board can act as the ARC, the appeal process outlined in § 3.2, which allows a homeowner to appeal an ARC decision to the Board, becomes an “exercise in futility.”
Respondent’s Position (Whisper Mountain HOA)
• Inherited Powers: Upon the Declarant’s departure, the Board assumed all of its rights and responsibilities under the CC&Rs, including the power to both appoint and remove ARC members.
• Authority from ARC Charter: The ARC Charter, adopted in 2016, explicitly grants the Board the sole right to remove ARC members at any time.
• Intent of the Board: The Board’s intent was not to abolish the ARC, but to address concerns about the committee’s conduct, including its “way of questioning applicants” and a need for more civility, fairness, and consistency.
• Clarification of “Suspension”: The use of the word “suspend” in communications by the management company (Mariposa Group) was “unfortunate and inaccurate.” The Board’s true action, clarified in its November 19 resolution, was to remove the non-Board members and appoint its own members to serve as the ARC.
• Valid Approval: The Board was legitimately acting as the ARC when it approved the Wells’ application; therefore, § 7.7 was not violated.
Administrative Law Judge’s Analysis and Conclusions
Interpretation of Governing Documents
The ALJ concluded that restrictive covenants must be construed as a whole and interpreted to give effect to the intent of the parties. The Judge found the Petitioner’s interpretation of the CC&Rs to be unpersuasive and ultimately harmful to the community.
• The Judge stated that the Petitioner’s interpretation “elevates non-elected members of ARC above elected Board members, abrogates any community control over ARC, and does not serve the underlying purposes of the CC&Rs.”
• This “unelected lifetime appointment” concept was found to be contrary to the “democratic principles underlying HOA law in Arizona.”
On the Board’s Authority
The ALJ affirmed the HOA’s authority to manage the ARC as it did.
• Assumption of Powers: The decision concludes that “When Declarant turned Respondent HOA over to its Board, the Board assumed all of Declarant’s rights and responsibilities under the CC&Rs and related documents.” This included the power to remove ARC members.
• ARC Charter: The Judge noted that the ARC Charter also “expressly provided that the Board had the power to remove as well as to appoint members of the ARC.”
• Legitimacy of Actions: The Board was found to have acted within its authority in August 2018 when it “removed the three non-Board members of the ARC and appointed itself to perform the functions of the ARC.”
On the Alleged Violations
Based on the finding that the Board acted within its authority, the ALJ concluded that no violations occurred.
• Conclusion on CC&R § 7.7 (ARC Approval): The petition failed on this point because the Board was legitimately acting as the ARC when it approved the Wells’ application in September 2018.
• Conclusion on CC&R § 3.2 (Appeals): The petition failed on this point because the CC&Rs do not prohibit Board members from acting as the ARC. While acknowledging that appealing a decision to the same body “may be an exercise in futility,” the Judge noted that under the CC&Rs, the Board is not required to hear appeals in any event.
Final Order and Implications
Order: The petition filed by N. Wayne Dwight, Jr. was denied. The Judge found he had not established that the HOA violated CC&Rs §§ 3.2 or 7.7.
Implications: This decision establishes a strong precedent for interpreting HOA governing documents in a manner that favors functional, democratic governance over literal interpretations that could lead to impractical or absurd outcomes. It affirms that an HOA Board generally inherits the full operational powers of the original developer unless explicitly restricted, and that a Board can act to reform or reconstitute committees to ensure they serve the community’s best interests.
Study Guide – 19F-H1918027-REL
Study Guide: Dwight v. Whisper Mountain Homeowners Association
This study guide provides a comprehensive review of the Administrative Law Judge Decision in the case of N. Wayne Dwight, Jr. vs. Whisper Mountain Homeowners Association (No. 19F-H1918027-REL). It includes a quiz to test factual recall, essay questions for deeper analysis, and a glossary of key terms as defined within the context of the legal document.
Short-Answer Quiz
Answer each of the following questions in two to three sentences, drawing exclusively from the provided source document.
1. What were the two specific allegations made by the Petitioner, N. Wayne Dwight, Jr., in his petition filed on October 22, 2018?
2. Identify the key parties in this case and describe their respective roles or relationships to the dispute.
3. What was the purpose and outcome of the ARC meeting held on July 17, 2018, regarding the Wells’ property?
4. Explain the actions taken by the Respondent’s Board of Directors during its meeting on August 6, 2018, regarding the Architectural Review Committee (ARC).
5. What was the Petitioner’s interpretation of CC&R § 3.4 regarding the removal of ARC members, and what was the potential consequence of this interpretation as noted by the Administrative Law Judge?
6. According to the Respondent’s Board president, Greg Robert Wingert, what were the primary reasons for removing the non-Board members of the ARC?
7. Describe the role of the Mariposa Group LLC in this case and explain how its communications created confusion.
8. How did the Board clarify its actions and ratify its decisions in the November 19, 2018 Resolution?
9. What is the legal standard of proof the Petitioner was required to meet, and how is it defined in the case documents?
10. What was the final ruling of the Administrative Law Judge, and what was the core reasoning behind the decision regarding CC&Rs §§ 3.2 and 7.7?
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Answer Key
1. The Petitioner alleged that the Respondent’s Board violated Covenants, Conditions, and Restrictions (CC&Rs) §§ 3.2 and 7.7. The specific violations cited were the dissolution or suspension of the Architectural Review Committee (ARC) on August 6, 2018, and the subsequent approval of an application from two members to build a detached garage on September 19, 2018.
2. The key parties are N. Wayne Dwight, Jr. (the “Petitioner”), a property owner and former ARC member, and the Whisper Mountain Homeowners Association (the “Respondent”). The case also involves Greg Robert Wingert, the President of the Respondent’s Board, and Mark and Connie Wells, the homeowners who applied to build a detached garage. The dispute centers on the Respondent’s authority over the ARC, of which the Petitioner was a member.
3. The purpose of the July 17, 2018, meeting was for the ARC, including the Petitioner, to consider Mark and Connie Wells’ application for a detached garage. The meeting was abruptly adjourned after the applicant allegedly threatened the committee, and no formal vote was conducted at that time. However, a letter dated July 30, 2018, later informed the Wells that the ARC had approved their request.
4. At the August 6, 2018, meeting, the Board of Directors discussed the need for more consistency and guidelines for the ARC. Citing these reasons and safety concerns from a prior meeting, the Board passed a motion to “suspend the ARC committee for 60 days” and announced that in the interim, the Board itself would review and approve all ARC submissions.
5. The Petitioner argued that CC&R § 3.4 only allowed the Board to appoint, not remove, ARC members. He contended that once appointed, members could only be removed for cause and were otherwise entitled to serve for life. The Judge noted this interpretation would elevate unelected ARC members above the elected Board and abrogate community control.
6. Greg Robert Wingert testified that the Board removed the non-Board ARC members due to concerns about the “manner in which questioning was done in a public forum.” The Board’s intent was not to eliminate the ARC, but to continue the review process while making it more civil, fair, consistent, and transparent.
7. The Mariposa Group LLC was the Respondent’s management company. Its employees, such as Ed Ericksen, were responsible for drafting official communications like minutes and letters. These communications used inaccurate words like “suspend” and “dissolve” to describe the Board’s actions regarding the ARC, which Mr. Wingert testified was an “unfortunate and inaccurate” choice of words that did not reflect the Board’s true intent.
8. The November 19, 2018, Resolution clarified that the Board had removed the existing ARC members and appointed itself to act and serve as the ARC, as was its right under CC&R § 3.4. The resolution explicitly stated that the Board members were the current members of the ARC and ratified all prior architectural decisions made by the Board while serving in this capacity, including the approval of the garage on Lot 18.
9. The Petitioner was required to prove his case by a “preponderance of the evidence.” This standard is defined as proof that convinces the trier of fact that a contention is more probably true than not, representing the greater weight of evidence that is sufficient to incline a fair and impartial mind to one side of the issue.
10. The Administrative Law Judge denied the Petitioner’s petition. The Judge concluded that the Board acted within its authority when it removed the non-Board ARC members and appointed itself to perform ARC functions, meaning it did not violate CC&R § 7.7 by approving the Wells’ application. The Judge also found no violation of CC&R § 3.2, noting that the CC&Rs do not prohibit Board members from acting as the ARC.
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Essay Questions
The following questions are designed for longer-form analysis. Formulate a comprehensive response based solely on the facts and legal interpretations presented in the source document.
1. Analyze the Administrative Law Judge’s interpretation of the CC&Rs, particularly § 3.4. How does this interpretation address the transfer of power from the “Declarant” to the Board, and how does it counter the Petitioner’s argument for lifetime appointments?
2. Discuss the concept of an “appeal” as outlined in CC&R § 3.2. Evaluate the potential conflict of interest and the issue of futility raised when the Board of Directors also serves as the Architectural Review Committee.
3. Trace the timeline of events surrounding the Wells’ application for a detached garage. How did this specific application serve as the catalyst for the broader conflict between the Petitioner and the Respondent’s Board?
4. Examine the role of communication and language in this dispute. How did the specific wording used by the management company in official documents (e.g., “suspend”) differ from the Board’s stated intent, and how did this discrepancy fuel the conflict?
5. Based on the evidence presented, evaluate the argument that the Board’s actions were a necessary measure to ensure a “civil, fair, consistent, and transparent” architectural review process versus the argument that the Board overstepped its authority as defined by the CC&Rs.
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Glossary of Key Terms
Definition within the Source Context
Administrative Law Judge (ALJ)
An independent judicial officer (Diane Mihalsky) from the Office of Administrative Hearings tasked with conducting an evidentiary hearing and rendering a decision on the petition.
Architectural Review Committee (ARC)
A committee established to review and approve or deny any improvements, alterations, or other work that alters the exterior appearance of a property. Per the CC&Rs, its decisions are final unless appealed to the Board.
ARC Charter
A document adopted by the Respondent’s Board on March 15, 2016, which provided that the ARC would consist of up to four members appointed by the Board and that the Board vested itself with the sole right to appoint and remove all appointed ARC members at any time.
Board of Directors (Board)
The elected body that conducts the affairs of the Whisper Mountain Homeowners Association. The document presumes they are elected by members to specific terms.
Covenants, Conditions, and Restrictions (CC&Rs)
The governing documents for the Whisper Mountain planned community, recorded on September 7, 2016. They outline the rules for property use, the structure of the HOA, and the functions of bodies like the ARC.
Declarant
The original developer who built the planned community, identified as VIP Homes. The Declarant initially held the sole right to appoint and remove ARC members, a right that transferred to the Board after the developer was no longer involved.
Mariposa Group LLC
The management company employed by the Respondent HOA. Its employees, such as Douglas Egan and Ed Ericksen, were responsible for drafting official communications like meeting minutes and approval letters.
Office of Administrative Hearings (OAH)
An independent state agency to which the Department of Real Estate referred the petition for an evidentiary hearing.
Petitioner
N. Wayne Dwight, Jr., a property owner in the Whisper Mountain development and a former member of the ARC. He filed the petition alleging the HOA violated its CC&Rs.
Preponderance of the Evidence
The standard of proof required for the Petitioner to win the case. It is defined as “such proof as convinces the trier of fact that the contention is more probably true than not.”
Respondent
The Whisper Mountain Homeowners Association (“HOA”), the governing body for the development. The Respondent was represented by its Board and legal counsel.
Blog Post – 19F-H1918027-REL
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19F-H1918027-REL
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The provided text is an Administrative Law Judge Decision from the Office of Administrative Hearings regarding a dispute between a homeowner, N. Wayne Dwight, Jr. (Petitioner), and the Whisper Mountain Homeowners Association (Respondent). The Petitioner alleged that the HOA’s Board violated the community’s Covenants, Conditions, and Restrictions (CC&Rs) by dissolving or suspending the Architectural Review Committee (ARC) and subsequently approving an application for a detached garage. The decision details the background, evidence presented at the hearing, and the Administrative Law Judge’s (ALJ) findings and conclusions of law. Ultimately, the ALJ denied the petition, finding that the Board acted within its authority under the governing documents to remove non-Board ARC members and appoint itself to fulfill the ARC’s functions. The ALJ concluded that the Petitioner failed to prove the HOA violated the specified CC&Rs.
Based on 1 source
Case Participants
Petitioner Side
N. Wayne Dwight, Jr.(petitioner) Appeared on his own behalf; former ARC member; testified on his own behalf
Respondent Side
Troy B. Stratman(attorney) Stratman Law Firm, PLC Represented Whisper Mountain Homeowners Association
Greg Robert Wingert(board member/witness) Whisper Mountain Homeowners Association Board President; Chairman of the ARC; testified for Respondent
Pam Cohen(board member) Whisper Mountain Homeowners Association Seconded motions; identified as 'Pam' in meeting minutes
Ronna(board member) Whisper Mountain Homeowners Association Made motion to suspend ARC
Gary(board member) Whisper Mountain Homeowners Association
Douglas Egan(property manager) Mariposa Group LLC Sent approval letter for garage application
Ed Ericksen(property manager) Mariposa Community Manager; sent approval/clarification letters regarding Wells' request
Neutral Parties
Diane Mihalsky(ALJ) Office of Administrative Hearings
Judy Lowe(Commissioner) Arizona Department of Real Estate
Felicia Del Sol(staff) Transmitted decision
Other Participants
Mark Wells(owner/applicant) Whisper Mountain development Submitted application for detached garage (Lot 18)
Connie Wells(owner/applicant) Whisper Mountain development Submitted application for detached garage (Lot 18)
Phil Hoyt(owner/member) Whisper Mountain development (Lot 16)
Andy Horn(owner/member) Whisper Mountain development (Lot 1)
Jason Komorowski(owner/member) Whisper Mountain development (Lot 51)
Connie Harrison(neighbor) Whisper Mountain development Mentioned regarding Lot 18 variance condition
Don Berry(owner/member) Whisper Mountain development (Lot 45)
The Administrative Law Judge denied the petition, finding that the HOA Board had the authority under the CC&Rs and related documents to remove non-Board ARC members and appoint itself to perform the functions of the ARC, thus validating its approval of the homeowner's detached garage application.
Why this result: The Petitioner failed to establish by a preponderance of the evidence that the Respondent violated CC&Rs §§ 3.2 or 7.7. The Board, having assumed the developer's rights, was authorized to remove and appoint ARC members.
Key Issues & Findings
Alleged violation of CC&Rs regarding ARC dissolution and architectural approval authority.
Petitioner alleged that the HOA Board violated CC&Rs §§ 3.2 and 7.7 by dissolving the ARC and then acting as the ARC to approve a modification (detached garage) for a homeowner.
Orders: Petitioner's petition was denied because he failed to establish that CC&Rs §§ 3.2 or 7.7 prohibited the Respondent HOA from replacing non-Board ARC members, appointing its own members to act as the ARC, or approving the detached garage application.
Administrative Law Judge Decision Briefing: Dwight vs. Whisper Mountain HOA
Executive Summary
This document summarizes the Administrative Law Judge (ALJ) decision in case number 19F-H1918027-REL, concerning a dispute between homeowner N. Wayne Dwight, Jr. (“Petitioner”) and the Whisper Mountain Homeowners Association (“Respondent”). The Petitioner alleged that the HOA Board violated the community’s Covenants, Conditions, and Restrictions (CC&Rs) by suspending the Architectural Review Committee (ARC) and subsequently approving a homeowner’s construction application.
The ALJ denied the petition in its entirety, finding that the HOA Board acted within its authority. The decision established that upon the departure of the original developer (the “Declarant”), the Board inherited the Declarant’s full rights and responsibilities, including the power to both appoint and remove members of the ARC. The Judge explicitly rejected the Petitioner’s argument that ARC members held lifetime appointments, deeming such an interpretation contrary to the democratic principles of HOA governance. Consequently, the Board’s decision to remove the non-Board ARC members and appoint itself to serve as the ARC was ruled a valid exercise of its powers, and its subsequent approval of the construction application was not a violation of the CC&Rs.
Case Overview
Entity
Petitioner
N. Wayne Dwight, Jr. (Homeowner and former ARC member)
Respondent
Whisper Mountain Homeowners Association (HOA)
Adjudicator
Administrative Law Judge Diane Mihalsky
Case Number
19F-H1918027-REL
Hearing Date
January 14, 2019
Decision Date
January 29, 2019
Core Allegation
The Petitioner alleged that the Respondent’s Board violated two sections of the CC&Rs:
1. § 7.7 (Improvements and Alterations): By approving a homeowner’s application to build a detached garage on September 19, 2018, without the approval of a properly constituted ARC.
2. § 3.2 (Appeal): By creating a situation where the body making an architectural decision (the Board acting as the ARC) is the same body that would hear an appeal of that decision, rendering the appeal process meaningless.
This was based on the Petitioner’s central claim that the Board’s action on August 6, 2018, to “dissolve” or “suspend” the ARC was a violation of the governing documents.
Key Factual Background & Timeline
• Prior to 2015: The developer, VIP Homes (“Declarant”), establishes the ARC as required by the CC&Rs.
• 2015: The Declarant turns over control of the HOA to the resident-elected Board of Directors.
• March 15, 2016: The Board adopts an ARC Charter, which explicitly states: “The right to appoint and remove all appointed [ARC] members at any time is hereby vested solely in the Board.” The Petitioner is appointed as one of three non-Board members to the ARC.
• 2017 or 2018: A proposed amendment to the CC&Rs to formally replace references to “Declarant” with “Board” or “Association” is not adopted by the general membership.
• July 17, 2018: The ARC meets to consider a detached garage application from homeowners Mark and Connie Wells. The meeting is contentious, with the Petitioner expressing doubts about the ARC’s authority to grant a variance from city setback requirements. The meeting adjourns abruptly after the applicant allegedly “verbally threatened the committee.”
• August 6, 2018: The HOA Board meets and passes a motion “to suspend the ARC committee for 60 days until guidelines/expectations are clarified.” The motion states that in the interim, the Board will review and approve all ARC submissions.
• August 24, 2018: The Board sends a letter to the non-Board ARC members, including the Petitioner, informing them of the 60-day suspension.
• September 17, 2018: The Board meets and approves a revised application from the Wells, which now aligns with City of Mesa code.
• September 19, 2018: The Board, formally acting as the ARC, reviews and approves the Wells’ revised application.
• October 22, 2018: The Petitioner files his complaint with the Arizona Department of Real Estate.
• November 19, 2018: The Board adopts a “Resolution Regarding the ARC” to clarify its position. The resolution states the Board had “(i) temporarily removed the current members of the [ARC] (via a suspension) and (ii) chose to act and serve as the current [ARC].” It also formally ratifies the approval of the Wells’ garage.
Central Arguments Presented
Petitioner’s Position (N. Wayne Dwight, Jr.)
• Limited Board Authority: The CC&Rs (§ 3.4) grant the Declarant the “sole right to appoint and remove” ARC members. After the Declarant’s departure, this section states that members “shall be appointed by the Board.” The Petitioner argued this only conferred the power to appoint, not to remove.
• Failed Amendment: The failure of the membership to amend the CC&Rs to explicitly grant the Board the Declarant’s powers proves that the Board does not possess the power of removal.
• Lifetime Appointments: The Petitioner argued that once appointed, ARC members could only be removed for specific cause (e.g., moving out of the community, incapacitation) and were otherwise entitled to serve for life.
• Improper ARC Suspension: The Board’s action to suspend the committee was a violation of the CC&Rs, as the Board lacked the authority to do so.
• Invalid Approval: Because the ARC was improperly suspended, the Board’s subsequent approval of the Wells’ application violated § 7.7, which requires ARC approval for all alterations.
• Meaningless Appeals: If the Board can act as the ARC, the appeal process outlined in § 3.2, which allows a homeowner to appeal an ARC decision to the Board, becomes an “exercise in futility.”
Respondent’s Position (Whisper Mountain HOA)
• Inherited Powers: Upon the Declarant’s departure, the Board assumed all of its rights and responsibilities under the CC&Rs, including the power to both appoint and remove ARC members.
• Authority from ARC Charter: The ARC Charter, adopted in 2016, explicitly grants the Board the sole right to remove ARC members at any time.
• Intent of the Board: The Board’s intent was not to abolish the ARC, but to address concerns about the committee’s conduct, including its “way of questioning applicants” and a need for more civility, fairness, and consistency.
• Clarification of “Suspension”: The use of the word “suspend” in communications by the management company (Mariposa Group) was “unfortunate and inaccurate.” The Board’s true action, clarified in its November 19 resolution, was to remove the non-Board members and appoint its own members to serve as the ARC.
• Valid Approval: The Board was legitimately acting as the ARC when it approved the Wells’ application; therefore, § 7.7 was not violated.
Administrative Law Judge’s Analysis and Conclusions
Interpretation of Governing Documents
The ALJ concluded that restrictive covenants must be construed as a whole and interpreted to give effect to the intent of the parties. The Judge found the Petitioner’s interpretation of the CC&Rs to be unpersuasive and ultimately harmful to the community.
• The Judge stated that the Petitioner’s interpretation “elevates non-elected members of ARC above elected Board members, abrogates any community control over ARC, and does not serve the underlying purposes of the CC&Rs.”
• This “unelected lifetime appointment” concept was found to be contrary to the “democratic principles underlying HOA law in Arizona.”
On the Board’s Authority
The ALJ affirmed the HOA’s authority to manage the ARC as it did.
• Assumption of Powers: The decision concludes that “When Declarant turned Respondent HOA over to its Board, the Board assumed all of Declarant’s rights and responsibilities under the CC&Rs and related documents.” This included the power to remove ARC members.
• ARC Charter: The Judge noted that the ARC Charter also “expressly provided that the Board had the power to remove as well as to appoint members of the ARC.”
• Legitimacy of Actions: The Board was found to have acted within its authority in August 2018 when it “removed the three non-Board members of the ARC and appointed itself to perform the functions of the ARC.”
On the Alleged Violations
Based on the finding that the Board acted within its authority, the ALJ concluded that no violations occurred.
• Conclusion on CC&R § 7.7 (ARC Approval): The petition failed on this point because the Board was legitimately acting as the ARC when it approved the Wells’ application in September 2018.
• Conclusion on CC&R § 3.2 (Appeals): The petition failed on this point because the CC&Rs do not prohibit Board members from acting as the ARC. While acknowledging that appealing a decision to the same body “may be an exercise in futility,” the Judge noted that under the CC&Rs, the Board is not required to hear appeals in any event.
Final Order and Implications
Order: The petition filed by N. Wayne Dwight, Jr. was denied. The Judge found he had not established that the HOA violated CC&Rs §§ 3.2 or 7.7.
Implications: This decision establishes a strong precedent for interpreting HOA governing documents in a manner that favors functional, democratic governance over literal interpretations that could lead to impractical or absurd outcomes. It affirms that an HOA Board generally inherits the full operational powers of the original developer unless explicitly restricted, and that a Board can act to reform or reconstitute committees to ensure they serve the community’s best interests.
Study Guide – 19F-H1918027-REL
Study Guide: Dwight v. Whisper Mountain Homeowners Association
This study guide provides a comprehensive review of the Administrative Law Judge Decision in the case of N. Wayne Dwight, Jr. vs. Whisper Mountain Homeowners Association (No. 19F-H1918027-REL). It includes a quiz to test factual recall, essay questions for deeper analysis, and a glossary of key terms as defined within the context of the legal document.
Short-Answer Quiz
Answer each of the following questions in two to three sentences, drawing exclusively from the provided source document.
1. What were the two specific allegations made by the Petitioner, N. Wayne Dwight, Jr., in his petition filed on October 22, 2018?
2. Identify the key parties in this case and describe their respective roles or relationships to the dispute.
3. What was the purpose and outcome of the ARC meeting held on July 17, 2018, regarding the Wells’ property?
4. Explain the actions taken by the Respondent’s Board of Directors during its meeting on August 6, 2018, regarding the Architectural Review Committee (ARC).
5. What was the Petitioner’s interpretation of CC&R § 3.4 regarding the removal of ARC members, and what was the potential consequence of this interpretation as noted by the Administrative Law Judge?
6. According to the Respondent’s Board president, Greg Robert Wingert, what were the primary reasons for removing the non-Board members of the ARC?
7. Describe the role of the Mariposa Group LLC in this case and explain how its communications created confusion.
8. How did the Board clarify its actions and ratify its decisions in the November 19, 2018 Resolution?
9. What is the legal standard of proof the Petitioner was required to meet, and how is it defined in the case documents?
10. What was the final ruling of the Administrative Law Judge, and what was the core reasoning behind the decision regarding CC&Rs §§ 3.2 and 7.7?
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Answer Key
1. The Petitioner alleged that the Respondent’s Board violated Covenants, Conditions, and Restrictions (CC&Rs) §§ 3.2 and 7.7. The specific violations cited were the dissolution or suspension of the Architectural Review Committee (ARC) on August 6, 2018, and the subsequent approval of an application from two members to build a detached garage on September 19, 2018.
2. The key parties are N. Wayne Dwight, Jr. (the “Petitioner”), a property owner and former ARC member, and the Whisper Mountain Homeowners Association (the “Respondent”). The case also involves Greg Robert Wingert, the President of the Respondent’s Board, and Mark and Connie Wells, the homeowners who applied to build a detached garage. The dispute centers on the Respondent’s authority over the ARC, of which the Petitioner was a member.
3. The purpose of the July 17, 2018, meeting was for the ARC, including the Petitioner, to consider Mark and Connie Wells’ application for a detached garage. The meeting was abruptly adjourned after the applicant allegedly threatened the committee, and no formal vote was conducted at that time. However, a letter dated July 30, 2018, later informed the Wells that the ARC had approved their request.
4. At the August 6, 2018, meeting, the Board of Directors discussed the need for more consistency and guidelines for the ARC. Citing these reasons and safety concerns from a prior meeting, the Board passed a motion to “suspend the ARC committee for 60 days” and announced that in the interim, the Board itself would review and approve all ARC submissions.
5. The Petitioner argued that CC&R § 3.4 only allowed the Board to appoint, not remove, ARC members. He contended that once appointed, members could only be removed for cause and were otherwise entitled to serve for life. The Judge noted this interpretation would elevate unelected ARC members above the elected Board and abrogate community control.
6. Greg Robert Wingert testified that the Board removed the non-Board ARC members due to concerns about the “manner in which questioning was done in a public forum.” The Board’s intent was not to eliminate the ARC, but to continue the review process while making it more civil, fair, consistent, and transparent.
7. The Mariposa Group LLC was the Respondent’s management company. Its employees, such as Ed Ericksen, were responsible for drafting official communications like minutes and letters. These communications used inaccurate words like “suspend” and “dissolve” to describe the Board’s actions regarding the ARC, which Mr. Wingert testified was an “unfortunate and inaccurate” choice of words that did not reflect the Board’s true intent.
8. The November 19, 2018, Resolution clarified that the Board had removed the existing ARC members and appointed itself to act and serve as the ARC, as was its right under CC&R § 3.4. The resolution explicitly stated that the Board members were the current members of the ARC and ratified all prior architectural decisions made by the Board while serving in this capacity, including the approval of the garage on Lot 18.
9. The Petitioner was required to prove his case by a “preponderance of the evidence.” This standard is defined as proof that convinces the trier of fact that a contention is more probably true than not, representing the greater weight of evidence that is sufficient to incline a fair and impartial mind to one side of the issue.
10. The Administrative Law Judge denied the Petitioner’s petition. The Judge concluded that the Board acted within its authority when it removed the non-Board ARC members and appointed itself to perform ARC functions, meaning it did not violate CC&R § 7.7 by approving the Wells’ application. The Judge also found no violation of CC&R § 3.2, noting that the CC&Rs do not prohibit Board members from acting as the ARC.
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Essay Questions
The following questions are designed for longer-form analysis. Formulate a comprehensive response based solely on the facts and legal interpretations presented in the source document.
1. Analyze the Administrative Law Judge’s interpretation of the CC&Rs, particularly § 3.4. How does this interpretation address the transfer of power from the “Declarant” to the Board, and how does it counter the Petitioner’s argument for lifetime appointments?
2. Discuss the concept of an “appeal” as outlined in CC&R § 3.2. Evaluate the potential conflict of interest and the issue of futility raised when the Board of Directors also serves as the Architectural Review Committee.
3. Trace the timeline of events surrounding the Wells’ application for a detached garage. How did this specific application serve as the catalyst for the broader conflict between the Petitioner and the Respondent’s Board?
4. Examine the role of communication and language in this dispute. How did the specific wording used by the management company in official documents (e.g., “suspend”) differ from the Board’s stated intent, and how did this discrepancy fuel the conflict?
5. Based on the evidence presented, evaluate the argument that the Board’s actions were a necessary measure to ensure a “civil, fair, consistent, and transparent” architectural review process versus the argument that the Board overstepped its authority as defined by the CC&Rs.
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Glossary of Key Terms
Definition within the Source Context
Administrative Law Judge (ALJ)
An independent judicial officer (Diane Mihalsky) from the Office of Administrative Hearings tasked with conducting an evidentiary hearing and rendering a decision on the petition.
Architectural Review Committee (ARC)
A committee established to review and approve or deny any improvements, alterations, or other work that alters the exterior appearance of a property. Per the CC&Rs, its decisions are final unless appealed to the Board.
ARC Charter
A document adopted by the Respondent’s Board on March 15, 2016, which provided that the ARC would consist of up to four members appointed by the Board and that the Board vested itself with the sole right to appoint and remove all appointed ARC members at any time.
Board of Directors (Board)
The elected body that conducts the affairs of the Whisper Mountain Homeowners Association. The document presumes they are elected by members to specific terms.
Covenants, Conditions, and Restrictions (CC&Rs)
The governing documents for the Whisper Mountain planned community, recorded on September 7, 2016. They outline the rules for property use, the structure of the HOA, and the functions of bodies like the ARC.
Declarant
The original developer who built the planned community, identified as VIP Homes. The Declarant initially held the sole right to appoint and remove ARC members, a right that transferred to the Board after the developer was no longer involved.
Mariposa Group LLC
The management company employed by the Respondent HOA. Its employees, such as Douglas Egan and Ed Ericksen, were responsible for drafting official communications like meeting minutes and approval letters.
Office of Administrative Hearings (OAH)
An independent state agency to which the Department of Real Estate referred the petition for an evidentiary hearing.
Petitioner
N. Wayne Dwight, Jr., a property owner in the Whisper Mountain development and a former member of the ARC. He filed the petition alleging the HOA violated its CC&Rs.
Preponderance of the Evidence
The standard of proof required for the Petitioner to win the case. It is defined as “such proof as convinces the trier of fact that the contention is more probably true than not.”
Respondent
The Whisper Mountain Homeowners Association (“HOA”), the governing body for the development. The Respondent was represented by its Board and legal counsel.
Blog Post – 19F-H1918027-REL
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19F-H1918027-REL
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The provided text is an Administrative Law Judge Decision from the Office of Administrative Hearings regarding a dispute between a homeowner, N. Wayne Dwight, Jr. (Petitioner), and the Whisper Mountain Homeowners Association (Respondent). The Petitioner alleged that the HOA’s Board violated the community’s Covenants, Conditions, and Restrictions (CC&Rs) by dissolving or suspending the Architectural Review Committee (ARC) and subsequently approving an application for a detached garage. The decision details the background, evidence presented at the hearing, and the Administrative Law Judge’s (ALJ) findings and conclusions of law. Ultimately, the ALJ denied the petition, finding that the Board acted within its authority under the governing documents to remove non-Board ARC members and appoint itself to fulfill the ARC’s functions. The ALJ concluded that the Petitioner failed to prove the HOA violated the specified CC&Rs.
Based on 1 source
Case Participants
Petitioner Side
N. Wayne Dwight, Jr.(petitioner) Appeared on his own behalf; former ARC member; testified on his own behalf
Respondent Side
Troy B. Stratman(attorney) Stratman Law Firm, PLC Represented Whisper Mountain Homeowners Association
Greg Robert Wingert(board member/witness) Whisper Mountain Homeowners Association Board President; Chairman of the ARC; testified for Respondent
Pam Cohen(board member) Whisper Mountain Homeowners Association Seconded motions; identified as 'Pam' in meeting minutes
Ronna(board member) Whisper Mountain Homeowners Association Made motion to suspend ARC
Gary(board member) Whisper Mountain Homeowners Association
Douglas Egan(property manager) Mariposa Group LLC Sent approval letter for garage application
Ed Ericksen(property manager) Mariposa Community Manager; sent approval/clarification letters regarding Wells' request
Neutral Parties
Diane Mihalsky(ALJ) Office of Administrative Hearings
Judy Lowe(Commissioner) Arizona Department of Real Estate
Felicia Del Sol(staff) Transmitted decision
Other Participants
Mark Wells(owner/applicant) Whisper Mountain development Submitted application for detached garage (Lot 18)
Connie Wells(owner/applicant) Whisper Mountain development Submitted application for detached garage (Lot 18)
Phil Hoyt(owner/member) Whisper Mountain development (Lot 16)
Andy Horn(owner/member) Whisper Mountain development (Lot 1)
Jason Komorowski(owner/member) Whisper Mountain development (Lot 51)
Connie Harrison(neighbor) Whisper Mountain development Mentioned regarding Lot 18 variance condition
Don Berry(owner/member) Whisper Mountain development (Lot 45)
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate
Study Guide – 17F-H1716023-REL
Study Guide: Saxion v. Silverton II Homeowners Association, Inc.
Short-Answer Quiz
Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the case documents.
1. Identify the primary parties involved in case number 17F-H1716023-REL and their respective roles.
2. What was the initial argument made by the Respondent, Silverton II HOA, in its Motion for Summary Judgement?
3. How did the Administrative Law Judge (ALJ) resolve the issue of Barry Saxion’s standing to pursue the action?
4. What was the second, and ultimately successful, argument presented by the Respondent for the case’s dismissal?
5. According to the HOA’s governing documents, what is the definition of a “covered claim”?
6. What was the final recommendation made by Administrative Law Judge Tammy L. Eigenheer in her decision dated May 16, 2017?
7. What immediate procedural action was taken as a result of the ALJ’s recommended decision on May 16, 2017?
8. Who formally accepted the ALJ’s decision, and what was the title of the document that finalized this acceptance?
9. What process must the petitioners now follow to resolve their dispute with the HOA, according to the final ruling?
10. Following the issuance of the Final Order on May 30, 2017, what right did the parties have if they disagreed with the decision?
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Answer Key
1. The primary parties were the Petitioners, Barry and Sandra Saxion, and the Respondent, Silverton II Homeowners Association, Inc. The Saxions initiated the dispute process, and the Homeowners Association was the entity against which the claim was filed.
2. The Respondent initially argued that the case should be dismissed because Petitioner Barry Saxion did not own property within the Association. This lack of ownership, they claimed, meant he did not possess the legal standing required to pursue the action.
3. The ALJ found that although Barry Saxion did not own property, Sandra Saxion did own property and had also signed the petition. Therefore, Sandra Saxion had standing to pursue the action, and the ALJ recommended denying the motion to dismiss on these grounds.
4. The Respondent’s successful argument was that Section 12.1 of the HOA’s Declaration required all covered claims to be resolved using the internal dispute resolution procedures set forth in the Declaration and Bylaws. They argued this must be done in lieu of initiating administrative proceedings.
5. A “covered claim” is defined as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
6. On May 16, 2017, the ALJ recommended that the Petition be dismissed. She concluded that the plain language of the HOA’s governing documents required the claim to be handled through the internal dispute resolution process before any administrative proceedings could be brought.
7. As a result of the ALJ’s recommendation, an order was issued vacating the hearing that was scheduled for May 22, 2017. The parties were advised of this through a Minute Entry.
8. Judy Lowe, the Commissioner of the Department of Real Estate, formally accepted the ALJ’s decision. This was finalized in a document titled “Final Order,” dated May 30, 2017.
9. The petitioners must handle their claim through the dispute resolution process set forth in the Silverton II Declaration and Bylaws. The Final Order mandates that this internal process must be used prior to bringing administrative proceedings.
10. After the Final Order, pursuant to A.R.S. § 41-1092.09, a party had the right to file a motion for rehearing or review within thirty (30) days. They also had the right to appeal the final administrative decision by filing a complaint for judicial review.
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Essay Questions
Instructions: The following questions require a more detailed analysis of the case. Formulate a comprehensive response for each, drawing connections between the different documents and legal concepts presented.
1. Analyze the concept of “standing” as it was presented and resolved in this case. Discuss why Barry Saxion’s lack of property ownership did not result in the case’s dismissal on those grounds, and explain the role of the original Petition in the ALJ’s finding.
2. Explain the legal hierarchy and procedural flow of this dispute. Trace the case from the initial petition to the Final Order, identifying the specific roles and actions of the Department of Real Estate, the Office of Administrative Hearings, the Administrative Law Judge, and the Commissioner.
3. Discuss the significance of Section 12.1 of the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” How did the “plain language” of this specific clause determine the ultimate outcome of the administrative proceeding?
4. Evaluate the two distinct arguments made by the Respondent in their Motion for Summary Judgement. Compare the legal reasoning used by the Administrative Law Judge in her recommendations for each argument and explain why one argument failed while the other succeeded.
5. Describe the post-decision options available to the parties following the issuance of the Final Order on May 30, 2017. What specific steps could a party take if they disagreed with the outcome, what were the associated deadlines, and to whom would a request for rehearing be addressed?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official who presides over administrative hearings, reviews evidence, and issues a recommended decision. In this case, the ALJ was Tammy L. Eigenheer.
Administrative Law Judge Decision
The formal written recommendation of the ALJ. In this matter, the decision recommended that the petition be dismissed based on the HOA’s governing documents.
Commissioner
The head of the Arizona Department of Real Estate. In this case, Commissioner Judy Lowe adopted the ALJ’s decision and issued the Final Order.
Covered Claims
A specific category of disputes defined in the HOA’s Declaration. It includes all claims, grievances, or disputes related to the interpretation, application, or enforcement of the HOA’s governing documents.
Declaration
The short name for the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” This is a core governing document for the HOA that dictates required procedures, such as dispute resolution.
Department of Real Estate (Department)
The Arizona state agency that referred the HOA dispute to the Office of Administrative Hearings and whose Commissioner issued the Final Order.
Final Order
A binding order issued by the Commissioner of the Department of Real Estate that accepts the ALJ’s decision. This order made the dismissal of the petition official and effective immediately.
Homeowners Association (HOA)
The governing body for the Silverton II community, which was the Respondent in this case.
Minute Entry
A brief entry on the case record noting a court or judge’s order or action. In this case, a Minute Entry was issued to vacate the scheduled May 22, 2017 hearing.
Motion for Summary Judgement
A formal request made by a party (in this case, the Respondent) asking the judge to rule in their favor without a full hearing, based on the argument that there are no disputed facts and the law is on their side.
Office of Administrative Hearings
The state office where the case was heard. It provides a neutral forum for resolving disputes involving state agencies.
Petitioner
The party who initiates a legal action or files a petition. In this case, the petitioners were Barry and Sandra Saxion.
Respondent
The party against whom a petition is filed. In this case, the respondent was the Silverton II Homeowners Association, Inc.
Standing
The legal right to bring a lawsuit or administrative action. In this context, standing was initially questioned based on property ownership within the HOA.
Blog Post – 17F-H1716023-REL
Why This Homeowner’s Complaint Against Their HOA Was Dismissed Before It Began
Dealing with a Homeowners Association (HOA) can be one of the most frustrating aspects of homeownership. When you feel the association is overstepping its bounds or failing to enforce the rules fairly, the natural impulse is to seek a formal resolution. Homeowners have rights, and there are official channels, like administrative hearings, designed to address these disputes.
But what if the path to justice has a mandatory detour you didn’t know about? The case of Saxion vs. Silverton II HOA is a powerful cautionary tale for any homeowner who believes they have a legitimate grievance. A close look at the official documents reveals surprising lessons, and it’s a stark reminder that in an HOA dispute, being right is not enough; you must also be procedurally perfect.
1. The Fine Print Is Your First Hurdle
The primary reason the homeowners’ petition was dismissed had nothing to do with the merits of their actual complaint. The Administrative Law Judge (ALJ) never weighed in on whether the homeowners were right or the HOA was wrong. Instead, the case was dismissed because the homeowners failed to follow the mandatory dispute resolution process required by their own HOA’s governing documents before they filed for an administrative hearing.
The association’s own rules legally required an internal process to be completed first. By going straight to an administrative filing, the homeowners had unintentionally bypassed a mandatory first step outlined in their governing documents. The ALJ pointed to the specific language in the HOA’s Declaration, which was the ultimate authority on the matter.
all covered claims “must be resolved using the dispute resolution procedures set forth . . . in [the] Declaration and the Bylaws in lieu of filing a lawsuit or initiating administrative proceedings.”
2. A Simple Clerical Error Can Jeopardize Your Entire Case
Before even getting to the core procedural issue, the HOA made another challenge that could have ended the case immediately. They argued that the petitioner officially named in the case caption, Barry Saxion, didn’t actually own property in the association and therefore had no legal standing.
This error, however, wasn’t made by the homeowners. The case documents reveal a critical lesson: when the Arizona Department of Real Estate referred the matter for a hearing, it was the agency that created the incorrect caption. This bureaucratic mistake could have been fatal, but the petition was saved because the ALJ noted that the original paperwork was signed by both Barry Saxion and Sandra Saxion, who did own property. Because both their names and signatures were on the petition, the ALJ could overlook the agency’s error. This highlights the need for homeowners to be vigilant, double-checking all official documents—even those prepared by a state agency.
3. A “Win” Doesn’t Always Mean Justice Was Served
The final outcome was not a judgment on the underlying disagreement. The petition was simply “dismissed.” This means the core issues the homeowners wanted to resolve were never actually heard or ruled on by the Administrative Law Judge.
The process itself is revealing. On May 16, 2017, the ALJ, Tammy L. Eigenheer, issued a recommendation that the complaint be dismissed. This recommendation was then reviewed by the Commissioner of the Department of Real Estate, Judy Lowe, who accepted it and issued a FINAL ORDER making the dismissal official on May 30, 2017. For the HOA, this was a victory won on a technicality. For the homeowners, it was a procedural dead end, preventing their core complaints from being heard in the administrative hearing. This shows how a legal victory can be won entirely on procedure, preventing the central conflict from ever being addressed.
Conclusion
The core lesson from the Saxion vs. Silverton II HOA case is clear: in a dispute with your HOA, understanding the procedural rules in your governing documents is just as important as the substance of your complaint. Failing to read and follow these rules can render your entire effort, no matter how justified, completely invalid. It can cost you time, money, and the opportunity to have your case heard at all. Before you take on your HOA, have you read the rulebook they require you to play by?
Case Participants
Petitioner Side
Barry Saxion(petitioner)
Sandra Saxion(petitioner)
Respondent Side
Troy B. Stratman(Respondent attorney) Stratman Law Firm, PLC
Neutral Parties
Tammy L. Eigenheer(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Abby Hansen(HOA Coordinator) Arizona Department of Real Estate
L. Dettorre(ADRE Staff) Arizona Department of Real Estate
D. Jones(ADRE Staff) Arizona Department of Real Estate
J. Marshall(ADRE Staff) Arizona Department of Real Estate
N. Cano(ADRE Staff) Arizona Department of Real Estate
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate
Study Guide – 17F-H1716023-REL
Study Guide: Saxion v. Silverton II Homeowners Association, Inc.
Short-Answer Quiz
Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the case documents.
1. Identify the primary parties involved in case number 17F-H1716023-REL and their respective roles.
2. What was the initial argument made by the Respondent, Silverton II HOA, in its Motion for Summary Judgement?
3. How did the Administrative Law Judge (ALJ) resolve the issue of Barry Saxion’s standing to pursue the action?
4. What was the second, and ultimately successful, argument presented by the Respondent for the case’s dismissal?
5. According to the HOA’s governing documents, what is the definition of a “covered claim”?
6. What was the final recommendation made by Administrative Law Judge Tammy L. Eigenheer in her decision dated May 16, 2017?
7. What immediate procedural action was taken as a result of the ALJ’s recommended decision on May 16, 2017?
8. Who formally accepted the ALJ’s decision, and what was the title of the document that finalized this acceptance?
9. What process must the petitioners now follow to resolve their dispute with the HOA, according to the final ruling?
10. Following the issuance of the Final Order on May 30, 2017, what right did the parties have if they disagreed with the decision?
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Answer Key
1. The primary parties were the Petitioners, Barry and Sandra Saxion, and the Respondent, Silverton II Homeowners Association, Inc. The Saxions initiated the dispute process, and the Homeowners Association was the entity against which the claim was filed.
2. The Respondent initially argued that the case should be dismissed because Petitioner Barry Saxion did not own property within the Association. This lack of ownership, they claimed, meant he did not possess the legal standing required to pursue the action.
3. The ALJ found that although Barry Saxion did not own property, Sandra Saxion did own property and had also signed the petition. Therefore, Sandra Saxion had standing to pursue the action, and the ALJ recommended denying the motion to dismiss on these grounds.
4. The Respondent’s successful argument was that Section 12.1 of the HOA’s Declaration required all covered claims to be resolved using the internal dispute resolution procedures set forth in the Declaration and Bylaws. They argued this must be done in lieu of initiating administrative proceedings.
5. A “covered claim” is defined as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
6. On May 16, 2017, the ALJ recommended that the Petition be dismissed. She concluded that the plain language of the HOA’s governing documents required the claim to be handled through the internal dispute resolution process before any administrative proceedings could be brought.
7. As a result of the ALJ’s recommendation, an order was issued vacating the hearing that was scheduled for May 22, 2017. The parties were advised of this through a Minute Entry.
8. Judy Lowe, the Commissioner of the Department of Real Estate, formally accepted the ALJ’s decision. This was finalized in a document titled “Final Order,” dated May 30, 2017.
9. The petitioners must handle their claim through the dispute resolution process set forth in the Silverton II Declaration and Bylaws. The Final Order mandates that this internal process must be used prior to bringing administrative proceedings.
10. After the Final Order, pursuant to A.R.S. § 41-1092.09, a party had the right to file a motion for rehearing or review within thirty (30) days. They also had the right to appeal the final administrative decision by filing a complaint for judicial review.
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Essay Questions
Instructions: The following questions require a more detailed analysis of the case. Formulate a comprehensive response for each, drawing connections between the different documents and legal concepts presented.
1. Analyze the concept of “standing” as it was presented and resolved in this case. Discuss why Barry Saxion’s lack of property ownership did not result in the case’s dismissal on those grounds, and explain the role of the original Petition in the ALJ’s finding.
2. Explain the legal hierarchy and procedural flow of this dispute. Trace the case from the initial petition to the Final Order, identifying the specific roles and actions of the Department of Real Estate, the Office of Administrative Hearings, the Administrative Law Judge, and the Commissioner.
3. Discuss the significance of Section 12.1 of the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” How did the “plain language” of this specific clause determine the ultimate outcome of the administrative proceeding?
4. Evaluate the two distinct arguments made by the Respondent in their Motion for Summary Judgement. Compare the legal reasoning used by the Administrative Law Judge in her recommendations for each argument and explain why one argument failed while the other succeeded.
5. Describe the post-decision options available to the parties following the issuance of the Final Order on May 30, 2017. What specific steps could a party take if they disagreed with the outcome, what were the associated deadlines, and to whom would a request for rehearing be addressed?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official who presides over administrative hearings, reviews evidence, and issues a recommended decision. In this case, the ALJ was Tammy L. Eigenheer.
Administrative Law Judge Decision
The formal written recommendation of the ALJ. In this matter, the decision recommended that the petition be dismissed based on the HOA’s governing documents.
Commissioner
The head of the Arizona Department of Real Estate. In this case, Commissioner Judy Lowe adopted the ALJ’s decision and issued the Final Order.
Covered Claims
A specific category of disputes defined in the HOA’s Declaration. It includes all claims, grievances, or disputes related to the interpretation, application, or enforcement of the HOA’s governing documents.
Declaration
The short name for the “Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II.” This is a core governing document for the HOA that dictates required procedures, such as dispute resolution.
Department of Real Estate (Department)
The Arizona state agency that referred the HOA dispute to the Office of Administrative Hearings and whose Commissioner issued the Final Order.
Final Order
A binding order issued by the Commissioner of the Department of Real Estate that accepts the ALJ’s decision. This order made the dismissal of the petition official and effective immediately.
Homeowners Association (HOA)
The governing body for the Silverton II community, which was the Respondent in this case.
Minute Entry
A brief entry on the case record noting a court or judge’s order or action. In this case, a Minute Entry was issued to vacate the scheduled May 22, 2017 hearing.
Motion for Summary Judgement
A formal request made by a party (in this case, the Respondent) asking the judge to rule in their favor without a full hearing, based on the argument that there are no disputed facts and the law is on their side.
Office of Administrative Hearings
The state office where the case was heard. It provides a neutral forum for resolving disputes involving state agencies.
Petitioner
The party who initiates a legal action or files a petition. In this case, the petitioners were Barry and Sandra Saxion.
Respondent
The party against whom a petition is filed. In this case, the respondent was the Silverton II Homeowners Association, Inc.
Standing
The legal right to bring a lawsuit or administrative action. In this context, standing was initially questioned based on property ownership within the HOA.
Blog Post – 17F-H1716023-REL
Why This Homeowner’s Complaint Against Their HOA Was Dismissed Before It Began
Dealing with a Homeowners Association (HOA) can be one of the most frustrating aspects of homeownership. When you feel the association is overstepping its bounds or failing to enforce the rules fairly, the natural impulse is to seek a formal resolution. Homeowners have rights, and there are official channels, like administrative hearings, designed to address these disputes.
But what if the path to justice has a mandatory detour you didn’t know about? The case of Saxion vs. Silverton II HOA is a powerful cautionary tale for any homeowner who believes they have a legitimate grievance. A close look at the official documents reveals surprising lessons, and it’s a stark reminder that in an HOA dispute, being right is not enough; you must also be procedurally perfect.
1. The Fine Print Is Your First Hurdle
The primary reason the homeowners’ petition was dismissed had nothing to do with the merits of their actual complaint. The Administrative Law Judge (ALJ) never weighed in on whether the homeowners were right or the HOA was wrong. Instead, the case was dismissed because the homeowners failed to follow the mandatory dispute resolution process required by their own HOA’s governing documents before they filed for an administrative hearing.
The association’s own rules legally required an internal process to be completed first. By going straight to an administrative filing, the homeowners had unintentionally bypassed a mandatory first step outlined in their governing documents. The ALJ pointed to the specific language in the HOA’s Declaration, which was the ultimate authority on the matter.
all covered claims “must be resolved using the dispute resolution procedures set forth . . . in [the] Declaration and the Bylaws in lieu of filing a lawsuit or initiating administrative proceedings.”
2. A Simple Clerical Error Can Jeopardize Your Entire Case
Before even getting to the core procedural issue, the HOA made another challenge that could have ended the case immediately. They argued that the petitioner officially named in the case caption, Barry Saxion, didn’t actually own property in the association and therefore had no legal standing.
This error, however, wasn’t made by the homeowners. The case documents reveal a critical lesson: when the Arizona Department of Real Estate referred the matter for a hearing, it was the agency that created the incorrect caption. This bureaucratic mistake could have been fatal, but the petition was saved because the ALJ noted that the original paperwork was signed by both Barry Saxion and Sandra Saxion, who did own property. Because both their names and signatures were on the petition, the ALJ could overlook the agency’s error. This highlights the need for homeowners to be vigilant, double-checking all official documents—even those prepared by a state agency.
3. A “Win” Doesn’t Always Mean Justice Was Served
The final outcome was not a judgment on the underlying disagreement. The petition was simply “dismissed.” This means the core issues the homeowners wanted to resolve were never actually heard or ruled on by the Administrative Law Judge.
The process itself is revealing. On May 16, 2017, the ALJ, Tammy L. Eigenheer, issued a recommendation that the complaint be dismissed. This recommendation was then reviewed by the Commissioner of the Department of Real Estate, Judy Lowe, who accepted it and issued a FINAL ORDER making the dismissal official on May 30, 2017. For the HOA, this was a victory won on a technicality. For the homeowners, it was a procedural dead end, preventing their core complaints from being heard in the administrative hearing. This shows how a legal victory can be won entirely on procedure, preventing the central conflict from ever being addressed.
Conclusion
The core lesson from the Saxion vs. Silverton II HOA case is clear: in a dispute with your HOA, understanding the procedural rules in your governing documents is just as important as the substance of your complaint. Failing to read and follow these rules can render your entire effort, no matter how justified, completely invalid. It can cost you time, money, and the opportunity to have your case heard at all. Before you take on your HOA, have you read the rulebook they require you to play by?
Case Participants
Petitioner Side
Barry Saxion(petitioner)
Sandra Saxion(petitioner)
Respondent Side
Troy B. Stratman(Respondent attorney) Stratman Law Firm, PLC
Neutral Parties
Tammy L. Eigenheer(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Abby Hansen(HOA Coordinator) Arizona Department of Real Estate
L. Dettorre(ADRE Staff) Arizona Department of Real Estate
D. Jones(ADRE Staff) Arizona Department of Real Estate
J. Marshall(ADRE Staff) Arizona Department of Real Estate
N. Cano(ADRE Staff) Arizona Department of Real Estate
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate
The Commissioner accepted the ALJ decision granting the Respondent's Motion for Summary Judgment, recommending dismissal of the petition due to the Department's lack of statutory jurisdiction over the dispute, which involved a Reciprocal Easement and Maintenance Agreement (REMA) and the rights of a third-party Golf Course Owner.
Why this result: The Department lacked jurisdiction to resolve the dispute because the REMA was not considered a 'community document' under A.R.S. § 33-1802(2) and the requested relief implicated the rights of a non-party (the Golf Course Owner) over whom the Department has no jurisdiction.
Key Issues & Findings
Jurisdiction over REMA Amendment Dispute
Petitioner sought a finding that REMA Amendments 2 and 3 were void because the HOA board unilaterally amended the REMA without the required member vote (two-thirds majority) as specified in the CC&Rs and REMA, and sought an order for the removal of the amendments from the record.
Orders: The Administrative Law Judge recommended granting Respondent's Motion for Summary Judgment and dismissing the Complaint.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
CC&Rs 14.2
REMA Article 12
Analytics Highlights
Topics: jurisdiction, summary judgment, golf course, REMA, third party
Additional Citations:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
A.R.S. § 32-2199.02(A)
CC&Rs 14.2
REMA 5.1
REMA Article 12
Video Overview
Audio Overview
Decision Documents
17F-H1716024-REL Decision – 563660.pdf
Uploaded 2025-10-09T03:31:21 (99.8 KB)
17F-H1716024-REL Decision – 568840.pdf
Uploaded 2025-10-09T03:31:21 (854.5 KB)
Briefing Doc – 17F-H1716024-REL
Briefing Document: Gronlund vs. Cottonfields Community Association (Case No. 17F-H1716024-REL)
Executive Summary
This document synthesizes the legal proceedings and decision in the case of Kurt Gronlund versus the Cottonfields Community Association, adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute centers on the petitioner’s allegation that the Homeowners Association (HOA) board improperly amended a critical land-use agreement in 2011 without a required vote of the membership, ultimately enabling the commercial rezoning of an adjacent golf course.
The Administrative Law Judge (ALJ) granted the HOA’s motion for summary judgment, and the Commissioner of the Arizona Department of Real Estate adopted this decision, dismissing the petition. The dismissal was not based on the merits of the petitioner’s claim but on a crucial lack of jurisdiction. The ALJ determined that the Department of Real Estate could not rule on the matter for two primary reasons:
1. The governing agreement in question (the REMA) is not a “community document” as defined by the relevant Arizona statute, placing it outside the Department’s purview.
2. The relief sought by the petitioner would directly implicate the property rights of a third party (the Golf Course Owner) and a prior legal settlement, which exceeds the Department’s statutory authority.
While acknowledging the petitioner’s concerns about the golf course development may be “well-founded,” the decision concluded that the petitioner’s available remedies lie in electing a new HOA board, filing a lawsuit in a judicial forum, or seeking legislative change.
Case Overview
This case involves a dispute between a homeowner and his HOA regarding the amendment of a land-use agreement governing a golf course property.
Parties Involved
Name / Entity
Description
Petitioner
Kurt Gronlund
A homeowner within the Cottonfields community and a member of the Respondent association.
Respondent
Cottonfields Community Association
The Homeowners Association (HOA) for the Cottonfields development.
Third Party
The Golf Course Owner
A separate legal entity that owns the golf course property adjacent to the community.
Case Chronology
• December 11, 2001: The developer records both the Reciprocal Easement and Maintenance Agreement (REMA) and the community’s CC&Rs.
• March 2011: The Cottonfields HOA board votes 3-2 to amend the REMA.
• March 3 & May 16, 2011: Amendments 2 and 3 to the REMA, which alter the legal description of the golf course property, are officially recorded.
• 2014: Litigation (Case No. CV2014-000639) begins in Maricopa County Superior Court between the HOA and the Golf Course Owner regarding the REMA and its amendments.
• July 2015: The HOA and the Golf Course Owner execute a settlement agreement.
• August 7, 2015: The superior court lawsuit is dismissed with prejudice.
• October 5, 2016: The HOA president represents to the City Council that homeowners favor rezoning the golf course. The Council approves a rezone from “GC” (Golf Course) to Commercial, relying on the 2011 REMA amendments.
• February 3, 2017: Kurt Gronlund files a Homeowners Association Dispute Process Petition with the Arizona Department of Real Estate.
• April 27, 2017: The HOA files a Motion for Summary Judgment, arguing a lack of jurisdiction.
• May 10, 2017: Oral arguments on the motion are held.
• May 11, 2017: The Administrative Law Judge issues a decision recommending dismissal.
• May 11, 2017: The Commissioner of the Department of Real Estate issues a Final Order adopting the ALJ’s decision and dismissing the case.
Core Dispute: Unilateral Amendment of the REMA
The petitioner’s case is founded on the claim that the HOA board acted in violation of its own governing documents when it facilitated changes to the REMA without consulting the community’s homeowners.
Petitioner’s Allegations
On February 3, 2017, Kurt Gronlund filed a petition asserting that the HOA board’s actions in 2011 were illegal and directly led to the loss of protection for homeowner property values.
• The Unilateral Action: The petition states, “[In] March 2011 the HOA board voted 3-2 to unilaterally amend REMA 5.1’s use restriction on the golf course property without the required vote of the approximately 450 eligible class members…”
• The Consequence: These amendments were used as justification for the HOA president to support a commercial rezoning of the golf course property before the City Council on October 5, 2016. The petitioner argues this “stripped away that last layer of protection” for homeowners who believed the golf course could not be developed without their approval.
• Homeowner Reliance: During oral arguments, the petitioner testified that members relied on the protections within the CC&Rs and REMA when purchasing their homes, believing development required a two-thirds majority vote.
Petitioner’s Requested Relief
The petitioner respectfully requested that the Administrative Court issue the following orders:
1. Find that REMA Section 5.1 may not be amended without the member vote required by REMA Article 12 and CC&Rs Section 14.2.
2. Find that Amendments 2 and 3 to the REMA are void and unenforceable.
3. Order the HOA Board to remove Amendments 2 and 3 from the public record.
Analysis of Governing Document Provisions
The dispute hinges on the interpretation of and interaction between two key legal documents: the REMA and the HOA’s CC&Rs.
Document
Section
Description
Key Language
Section 5.1
Use Restriction: Restricts the golf course property’s use to either a golf course or open space.
“The Golf Course Property shall be used solely and exclusively for Golf Course Use or as open space, and for no other purposes.”
Article 12
Amendment Procedure: Stipulates that changes to Section 5.1 require the same member vote as an amendment to the HOA’s Declaration (CC&Rs).
“…no termination, cancellation, change, modification or amendment of paragraph 5.1… shall be made without the written approval thereof by the number of Members… required to amend the Declaration pursuant to Section 13.2 thereof.”
Section 14.2
Member Vote Requirement: Defines the threshold for amending the CC&Rs.
“…may be amended only by the affirmative vote (in person or by proxy) or written consent of: (a) Members holding not less than two-thirds (2/3) of all Class A votes then entitled to be cast; and (b) Members holding not less than two thirds (2/3) of all Class B votes…”
Section 14.17
Third-Party Rights: Protects the rights of the Golf Course Owner, stating that provisions benefiting them cannot be amended without their written consent.
“…no provision of this Declaration… which grants to or confers upon the Golf Course Owner or the Golf Course Property any rights… shall be modified, amended or revoked in any way without the express written consent of the Golf Course Owner.”
Jurisdictional Challenge and Legal Rationale for Dismissal
The HOA’s defense focused not on the factual allegations but on the argument that the Department of Real Estate was the improper forum for this dispute. The ALJ ultimately agreed with this position.
Respondent’s Motion for Summary Judgment
The Cottonfields Community Association argued that the Department could not grant the petitioner’s requested relief because:
1. The REMA is not a “community document” as defined under Arizona law (A.R.S. § 32-2199.01(A)).
2. The Golf Course Owner is a third party over whom the Department lacks jurisdiction.
3. Any ruling would affect the rights of this third party and could impact the 2015 settlement agreement from the superior court case.
Administrative Law Judge’s Conclusions of Law
The ALJ’s decision was based on a strict interpretation of the Department’s statutory authority.
• REMA is Not a “Community Document”: The judge found that although the REMA references the CC&Rs, it does not meet the legal definition of a community document under A.R.S. § 33-1802(2), which defines them as “the declaration, bylaws, articles of incorporation, if any, and rules, if any.” The Department’s authority under A.R.S. § 32-2199.01(A) is limited to violations of these specific documents.
• Implication of Third-Party Rights: The decision states that the petitioner’s request to void the amendments “implicates the Golf Course Owner’s interests in its property and may affect the settlement that the Golf Course Owner entered into with Respondent.” The law does not grant the Department “jurisdiction over disputes that implicate the rights of third parties.”
• Petitioner’s Available Remedies: While validating the petitioner’s underlying worries, the judge outlined specific alternative courses of action. The decision states: “Petitioner’s concerns about development of the golf course may be well-founded. However, under applicable statutes, at this time, his available remedies are to elect a board that will better protect members’ interest in maintaining the golf course, to file suit in a judicial forum against Respondent and the Golf Course Owner, or to ask the legislature to amend A.R.S. §§ 33-1802(2) and 32-2199.01(A).”
Final Order and Disposition
Based on the legal conclusions regarding jurisdiction, the case was dismissed.
• ALJ Recommendation: On May 11, 2017, Administrative Law Judge Diane Mihalsky recommended that the complaint be dismissed.
• Commissioner’s Final Order: On May 11, 2017, Judy Lowe, Commissioner for the Arizona Department of Real Estate, issued a Final Order stating: “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed.”
• Further Action: The Final Order noted that a party may file for a rehearing or review within thirty days, or may appeal the final administrative decision by filing a complaint for judicial review.
Study Guide – 17F-H1716024-REL
Study Guide: Gronlund v. Cottonfields Community Association
This guide provides a detailed review of the administrative case Kurt Gronlund v. Cottonfields Community Association (No. 17F-H1716024-REL), focusing on the key legal arguments, governing documents, and the court’s final decision regarding jurisdiction.
Short-Answer Quiz
Answer the following questions in 2-3 sentences based on the provided legal documents.
1. Who are the Petitioner and Respondent in this case, and what is their relationship?
2. What central allegation did the Petitioner make regarding the HOA board’s actions in March 2011?
3. What specific relief did the Petitioner request from the Administrative Court in his petition?
4. Identify the two key legal documents at the heart of the dispute and briefly explain their respective roles.
5. According to REMA Article 12 and CC&Rs Section 14.2, what was the required procedure to amend the use restriction on the golf course property?
6. On what primary grounds did the Respondent, Cottonfields Community Association, file a motion for summary judgment?
7. What was the Administrative Law Judge’s key legal conclusion regarding the status of the Reciprocal Easement and Maintenance Agreement (REMA)?
8. Why did the Administrative Law Judge ultimately find that the Arizona Department of Real Estate lacked the jurisdiction to grant the Petitioner’s requested relief?
9. What alternative remedies did the Administrative Law Judge suggest were available to the Petitioner?
10. What was the final outcome of the case as determined by the Commissioner of the Department of Real Estate?
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Answer Key
1. The Petitioner is Kurt Gronlund, a homeowner and member of the Cottonfields Community Association. The Respondent is the Cottonfields Community Association, which is the Homeowners Association (HOA) for the residential development where the Petitioner owns a home.
2. The Petitioner alleged that the HOA board voted 3-2 to unilaterally amend REMA Section 5.1’s use restriction on the golf course property. This action was allegedly taken without the required vote of the approximately 450 eligible class members, which constituted a violation of the governing documents.
3. The Petitioner requested that the court find Amendments 2 and 3 to the REMA to be void and unenforceable, order the HOA Board to remove these amendments from the public record, and issue a finding that REMA 5.1 may not be amended without the member vote required by the CC&Rs.
4. The key documents are the Declaration of Covenants, Conditions and Restrictions (CC&Rs) and the Reciprocal Easement and Maintenance Agreement (REMA). The CC&Rs are the primary governing documents for the HOA, while the REMA is a separate agreement between the developer/HOA and the Golf Course Owner specifically governing the use of the golf course property.
5. REMA Article 12 required that any amendment to Section 5.1 (the use restriction) receive written approval from the number of Members specified in the CC&Rs. CC&Rs Section 14.2 stipulates this requires an affirmative vote or written consent of members holding at least two-thirds (2/3) of all Class A and Class B votes.
6. The Respondent argued that the Department of Real Estate lacked jurisdiction to rule on the matter. This argument was based on two points: the REMA was not a “community document” as defined by Arizona statute, and the dispute involved the rights of the Golf Course Owner, a third party over whom the Department had no authority.
7. The Judge concluded that although the REMA references the CC&Rs, it is not a “community document” as defined in A.R.S. § 33-1802(2). This determination was central to the case, as the Department’s jurisdiction is limited to disputes concerning community documents.
8. The Department’s jurisdiction under A.R.S. § 32-2199.01(A) does not extend to disputes that implicate the rights of third parties. Because the Petitioner’s request would affect the property interests of the Golf Course Owner and a 2015 legal settlement, the Department was not statutorily authorized to resolve the issue.
9. The Judge suggested three potential remedies: elect a new HOA board that will better protect members’ interests, file a lawsuit in a judicial forum against both the HOA and the Golf Course Owner, or ask the state legislature to amend the relevant statutes governing HOAs and community documents.
10. The Commissioner of the Department of Real Estate adopted the Administrative Law Judge’s recommendation in a Final Order dated May 11, 2017. The Commissioner accepted the decision that the Department lacked jurisdiction and ordered that the Petitioner’s complaint be dismissed.
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Essay Questions
The following questions are designed to encourage a deeper analysis of the case. No answers are provided.
1. Analyze the distinction between a “community document” and the REMA as presented in this case. Why was this distinction the pivotal point in the Administrative Law Judge’s decision to recommend dismissal for lack of jurisdiction?
2. Discuss the procedural history of the dispute over the golf course property, beginning with the REMA amendments in 2011 and including the 2014 litigation, the 2015 settlement, and the 2016 rezoning. How did these prior events impact the arguments and outcome of Gronlund’s 2017 petition?
3. Explain the conflict between the powers granted to the HOA Board and Golf Course Owner in REMA Article 12 and the protections afforded to homeowners in the same article’s reference to CC&Rs Section 14.2. How did the Petitioner and Respondent interpret these clauses differently?
4. Evaluate the legal reasoning behind the Administrative Law Judge’s conclusion that the Department of Real Estate lacked jurisdiction over third parties like the Golf Course Owner. Why would resolving Gronlund’s petition necessarily implicate the rights of this third party?
5. The Judge outlines three potential remedies for the Petitioner: electoral, judicial, and legislative. Describe each of these remedies and discuss the potential challenges and benefits of each path in seeking to protect the golf course from development.
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
A judge who presides over administrative hearings at a government agency, in this case, the Office of Administrative Hearings (OAH). The ALJ in this matter was Diane Mihalsky.
A.R.S. (Arizona Revised Statutes)
The collection of all the laws passed by the Arizona state legislature. Specific statutes, such as A.R.S. § 32-2199.01(A) and § 33-1802(2), were central to this case.
CC&Rs (Declaration of Covenants, Conditions and Restrictions)
The primary governing legal documents for a planned community or homeowners’ association that outline the rules and member obligations.
Commissioner
The head of a government department. In this case, Judy Lowe, the Commissioner of the Arizona Department of Real Estate, issued the Final Order.
Community Documents
As defined by A.R.S. § 33-1802(2), these include a planned community’s declaration (CC&Rs), bylaws, articles of incorporation, and rules. The REMA was determined not to fall under this definition.
Dismissed with Prejudice
A legal term for a final judgment that prevents the plaintiff from filing another case on the same claim. The 2014 lawsuit between the HOA and the Golf Course Owner was dismissed with prejudice.
Golf Course Owner
A separate legal entity that owned the golf course property and was a primary party to the REMA, but was not a party to this administrative case.
• HOA (Homeowners Association) | An organization in a subdivision or planned community that creates and enforces rules for the properties within its jurisdiction. In this case, the Cottonfields Community Association. | | Jurisdiction | The official power to make legal decisions and judgments. The central legal issue of the case was whether the Arizona Department of Real Estate had jurisdiction over the dispute. | | Motion for Summary Judgment | A request made by a party asking the court to decide a case in their favor without a full trial, arguing that there are no material facts in dispute and that they are entitled to win as a matter of law. | | Office of Administrative Hearings (OAH) | An independent Arizona state agency that conducts evidentiary hearings for other state agencies to ensure fair and impartial decisions. | | Petitioner | The party who files a petition or brings an action before a court or administrative body. In this case, Kurt Gronlund. | | REMA (Reciprocal Easement and Maintenance Agreement) | A recorded legal agreement between the original developer/HOA and the Golf Course Owner that established mutual rights, easements, and obligations, including the critical use restriction on the golf course property. | | Respondent | The party against whom a petition is filed or an appeal is brought. In this case, the Cottonfields Community Association. |
Blog Post – 17F-H1716024-REL
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17F-H1716024-REL
2 sources
The provided sources consist of an Administrative Law Judge Decision and a subsequent Final Order from the Arizona Department of Real Estate concerning a dispute between homeowner Kurt Gronlund, the Petitioner, and the Cottonfields Community Association, the Respondent. The administrative law judge recommended granting the Association’s motion for summary judgment because the Department of Real Estate lacked jurisdiction over the matter, a recommendation which the Commissioner ultimately accepted. The core of the conflict was Gronlund’s petition challenging the Association’s 2011 amendments to a Reciprocal Easement and Maintenance Agreement (REMA), which governed the use of a golf course adjacent to the community. The decision clarified that the REMA was not classified as a “community document” under the relevant statutes, and furthermore, the requested relief would improperly implicate the rights of the Golf Course Owner, a third party over whom the Department had no authority. The final ruling therefore dismissed the petition, suggesting judicial action or legislative change as alternative remedies for the petitioner.
Case Participants
Petitioner Side
Kurt Gronlund(petitioner)
Respondent Side
Troy B. Stratman(attorney) Stratman Law Firm, PLC
Neutral Parties
Diane Mihalsky(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Abby Hansen(HOA Coordinator) Arizona Department of Real Estate Responsible for processing rehearing requests and listed on ADRE service email list.
LDettorre(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
djones(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
jmarshall(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
ncano(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
The Commissioner accepted the ALJ decision granting the Respondent's Motion for Summary Judgment, recommending dismissal of the petition due to the Department's lack of statutory jurisdiction over the dispute, which involved a Reciprocal Easement and Maintenance Agreement (REMA) and the rights of a third-party Golf Course Owner.
Why this result: The Department lacked jurisdiction to resolve the dispute because the REMA was not considered a 'community document' under A.R.S. § 33-1802(2) and the requested relief implicated the rights of a non-party (the Golf Course Owner) over whom the Department has no jurisdiction.
Key Issues & Findings
Jurisdiction over REMA Amendment Dispute
Petitioner sought a finding that REMA Amendments 2 and 3 were void because the HOA board unilaterally amended the REMA without the required member vote (two-thirds majority) as specified in the CC&Rs and REMA, and sought an order for the removal of the amendments from the record.
Orders: The Administrative Law Judge recommended granting Respondent's Motion for Summary Judgment and dismissing the Complaint.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
CC&Rs 14.2
REMA Article 12
Analytics Highlights
Topics: jurisdiction, summary judgment, golf course, REMA, third party
Additional Citations:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
A.R.S. § 32-2199.02(A)
CC&Rs 14.2
REMA 5.1
REMA Article 12
Video Overview
Audio Overview
Decision Documents
17F-H1716024-REL Decision – 563660.pdf
Uploaded 2026-01-23T17:19:21 (99.8 KB)
17F-H1716024-REL Decision – 568840.pdf
Uploaded 2026-01-23T17:19:24 (854.5 KB)
Briefing Doc – 17F-H1716024-REL
Briefing Document: Gronlund vs. Cottonfields Community Association (Case No. 17F-H1716024-REL)
Executive Summary
This document synthesizes the legal proceedings and decision in the case of Kurt Gronlund versus the Cottonfields Community Association, adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute centers on the petitioner’s allegation that the Homeowners Association (HOA) board improperly amended a critical land-use agreement in 2011 without a required vote of the membership, ultimately enabling the commercial rezoning of an adjacent golf course.
The Administrative Law Judge (ALJ) granted the HOA’s motion for summary judgment, and the Commissioner of the Arizona Department of Real Estate adopted this decision, dismissing the petition. The dismissal was not based on the merits of the petitioner’s claim but on a crucial lack of jurisdiction. The ALJ determined that the Department of Real Estate could not rule on the matter for two primary reasons:
1. The governing agreement in question (the REMA) is not a “community document” as defined by the relevant Arizona statute, placing it outside the Department’s purview.
2. The relief sought by the petitioner would directly implicate the property rights of a third party (the Golf Course Owner) and a prior legal settlement, which exceeds the Department’s statutory authority.
While acknowledging the petitioner’s concerns about the golf course development may be “well-founded,” the decision concluded that the petitioner’s available remedies lie in electing a new HOA board, filing a lawsuit in a judicial forum, or seeking legislative change.
Case Overview
This case involves a dispute between a homeowner and his HOA regarding the amendment of a land-use agreement governing a golf course property.
Parties Involved
Name / Entity
Description
Petitioner
Kurt Gronlund
A homeowner within the Cottonfields community and a member of the Respondent association.
Respondent
Cottonfields Community Association
The Homeowners Association (HOA) for the Cottonfields development.
Third Party
The Golf Course Owner
A separate legal entity that owns the golf course property adjacent to the community.
Case Chronology
• December 11, 2001: The developer records both the Reciprocal Easement and Maintenance Agreement (REMA) and the community’s CC&Rs.
• March 2011: The Cottonfields HOA board votes 3-2 to amend the REMA.
• March 3 & May 16, 2011: Amendments 2 and 3 to the REMA, which alter the legal description of the golf course property, are officially recorded.
• 2014: Litigation (Case No. CV2014-000639) begins in Maricopa County Superior Court between the HOA and the Golf Course Owner regarding the REMA and its amendments.
• July 2015: The HOA and the Golf Course Owner execute a settlement agreement.
• August 7, 2015: The superior court lawsuit is dismissed with prejudice.
• October 5, 2016: The HOA president represents to the City Council that homeowners favor rezoning the golf course. The Council approves a rezone from “GC” (Golf Course) to Commercial, relying on the 2011 REMA amendments.
• February 3, 2017: Kurt Gronlund files a Homeowners Association Dispute Process Petition with the Arizona Department of Real Estate.
• April 27, 2017: The HOA files a Motion for Summary Judgment, arguing a lack of jurisdiction.
• May 10, 2017: Oral arguments on the motion are held.
• May 11, 2017: The Administrative Law Judge issues a decision recommending dismissal.
• May 11, 2017: The Commissioner of the Department of Real Estate issues a Final Order adopting the ALJ’s decision and dismissing the case.
Core Dispute: Unilateral Amendment of the REMA
The petitioner’s case is founded on the claim that the HOA board acted in violation of its own governing documents when it facilitated changes to the REMA without consulting the community’s homeowners.
Petitioner’s Allegations
On February 3, 2017, Kurt Gronlund filed a petition asserting that the HOA board’s actions in 2011 were illegal and directly led to the loss of protection for homeowner property values.
• The Unilateral Action: The petition states, “[In] March 2011 the HOA board voted 3-2 to unilaterally amend REMA 5.1’s use restriction on the golf course property without the required vote of the approximately 450 eligible class members…”
• The Consequence: These amendments were used as justification for the HOA president to support a commercial rezoning of the golf course property before the City Council on October 5, 2016. The petitioner argues this “stripped away that last layer of protection” for homeowners who believed the golf course could not be developed without their approval.
• Homeowner Reliance: During oral arguments, the petitioner testified that members relied on the protections within the CC&Rs and REMA when purchasing their homes, believing development required a two-thirds majority vote.
Petitioner’s Requested Relief
The petitioner respectfully requested that the Administrative Court issue the following orders:
1. Find that REMA Section 5.1 may not be amended without the member vote required by REMA Article 12 and CC&Rs Section 14.2.
2. Find that Amendments 2 and 3 to the REMA are void and unenforceable.
3. Order the HOA Board to remove Amendments 2 and 3 from the public record.
Analysis of Governing Document Provisions
The dispute hinges on the interpretation of and interaction between two key legal documents: the REMA and the HOA’s CC&Rs.
Document
Section
Description
Key Language
Section 5.1
Use Restriction: Restricts the golf course property’s use to either a golf course or open space.
“The Golf Course Property shall be used solely and exclusively for Golf Course Use or as open space, and for no other purposes.”
Article 12
Amendment Procedure: Stipulates that changes to Section 5.1 require the same member vote as an amendment to the HOA’s Declaration (CC&Rs).
“…no termination, cancellation, change, modification or amendment of paragraph 5.1… shall be made without the written approval thereof by the number of Members… required to amend the Declaration pursuant to Section 13.2 thereof.”
Section 14.2
Member Vote Requirement: Defines the threshold for amending the CC&Rs.
“…may be amended only by the affirmative vote (in person or by proxy) or written consent of: (a) Members holding not less than two-thirds (2/3) of all Class A votes then entitled to be cast; and (b) Members holding not less than two thirds (2/3) of all Class B votes…”
Section 14.17
Third-Party Rights: Protects the rights of the Golf Course Owner, stating that provisions benefiting them cannot be amended without their written consent.
“…no provision of this Declaration… which grants to or confers upon the Golf Course Owner or the Golf Course Property any rights… shall be modified, amended or revoked in any way without the express written consent of the Golf Course Owner.”
Jurisdictional Challenge and Legal Rationale for Dismissal
The HOA’s defense focused not on the factual allegations but on the argument that the Department of Real Estate was the improper forum for this dispute. The ALJ ultimately agreed with this position.
Respondent’s Motion for Summary Judgment
The Cottonfields Community Association argued that the Department could not grant the petitioner’s requested relief because:
1. The REMA is not a “community document” as defined under Arizona law (A.R.S. § 32-2199.01(A)).
2. The Golf Course Owner is a third party over whom the Department lacks jurisdiction.
3. Any ruling would affect the rights of this third party and could impact the 2015 settlement agreement from the superior court case.
Administrative Law Judge’s Conclusions of Law
The ALJ’s decision was based on a strict interpretation of the Department’s statutory authority.
• REMA is Not a “Community Document”: The judge found that although the REMA references the CC&Rs, it does not meet the legal definition of a community document under A.R.S. § 33-1802(2), which defines them as “the declaration, bylaws, articles of incorporation, if any, and rules, if any.” The Department’s authority under A.R.S. § 32-2199.01(A) is limited to violations of these specific documents.
• Implication of Third-Party Rights: The decision states that the petitioner’s request to void the amendments “implicates the Golf Course Owner’s interests in its property and may affect the settlement that the Golf Course Owner entered into with Respondent.” The law does not grant the Department “jurisdiction over disputes that implicate the rights of third parties.”
• Petitioner’s Available Remedies: While validating the petitioner’s underlying worries, the judge outlined specific alternative courses of action. The decision states: “Petitioner’s concerns about development of the golf course may be well-founded. However, under applicable statutes, at this time, his available remedies are to elect a board that will better protect members’ interest in maintaining the golf course, to file suit in a judicial forum against Respondent and the Golf Course Owner, or to ask the legislature to amend A.R.S. §§ 33-1802(2) and 32-2199.01(A).”
Final Order and Disposition
Based on the legal conclusions regarding jurisdiction, the case was dismissed.
• ALJ Recommendation: On May 11, 2017, Administrative Law Judge Diane Mihalsky recommended that the complaint be dismissed.
• Commissioner’s Final Order: On May 11, 2017, Judy Lowe, Commissioner for the Arizona Department of Real Estate, issued a Final Order stating: “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed.”
• Further Action: The Final Order noted that a party may file for a rehearing or review within thirty days, or may appeal the final administrative decision by filing a complaint for judicial review.
Study Guide – 17F-H1716024-REL
Study Guide: Gronlund v. Cottonfields Community Association
This guide provides a detailed review of the administrative case Kurt Gronlund v. Cottonfields Community Association (No. 17F-H1716024-REL), focusing on the key legal arguments, governing documents, and the court’s final decision regarding jurisdiction.
Short-Answer Quiz
Answer the following questions in 2-3 sentences based on the provided legal documents.
1. Who are the Petitioner and Respondent in this case, and what is their relationship?
2. What central allegation did the Petitioner make regarding the HOA board’s actions in March 2011?
3. What specific relief did the Petitioner request from the Administrative Court in his petition?
4. Identify the two key legal documents at the heart of the dispute and briefly explain their respective roles.
5. According to REMA Article 12 and CC&Rs Section 14.2, what was the required procedure to amend the use restriction on the golf course property?
6. On what primary grounds did the Respondent, Cottonfields Community Association, file a motion for summary judgment?
7. What was the Administrative Law Judge’s key legal conclusion regarding the status of the Reciprocal Easement and Maintenance Agreement (REMA)?
8. Why did the Administrative Law Judge ultimately find that the Arizona Department of Real Estate lacked the jurisdiction to grant the Petitioner’s requested relief?
9. What alternative remedies did the Administrative Law Judge suggest were available to the Petitioner?
10. What was the final outcome of the case as determined by the Commissioner of the Department of Real Estate?
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Answer Key
1. The Petitioner is Kurt Gronlund, a homeowner and member of the Cottonfields Community Association. The Respondent is the Cottonfields Community Association, which is the Homeowners Association (HOA) for the residential development where the Petitioner owns a home.
2. The Petitioner alleged that the HOA board voted 3-2 to unilaterally amend REMA Section 5.1’s use restriction on the golf course property. This action was allegedly taken without the required vote of the approximately 450 eligible class members, which constituted a violation of the governing documents.
3. The Petitioner requested that the court find Amendments 2 and 3 to the REMA to be void and unenforceable, order the HOA Board to remove these amendments from the public record, and issue a finding that REMA 5.1 may not be amended without the member vote required by the CC&Rs.
4. The key documents are the Declaration of Covenants, Conditions and Restrictions (CC&Rs) and the Reciprocal Easement and Maintenance Agreement (REMA). The CC&Rs are the primary governing documents for the HOA, while the REMA is a separate agreement between the developer/HOA and the Golf Course Owner specifically governing the use of the golf course property.
5. REMA Article 12 required that any amendment to Section 5.1 (the use restriction) receive written approval from the number of Members specified in the CC&Rs. CC&Rs Section 14.2 stipulates this requires an affirmative vote or written consent of members holding at least two-thirds (2/3) of all Class A and Class B votes.
6. The Respondent argued that the Department of Real Estate lacked jurisdiction to rule on the matter. This argument was based on two points: the REMA was not a “community document” as defined by Arizona statute, and the dispute involved the rights of the Golf Course Owner, a third party over whom the Department had no authority.
7. The Judge concluded that although the REMA references the CC&Rs, it is not a “community document” as defined in A.R.S. § 33-1802(2). This determination was central to the case, as the Department’s jurisdiction is limited to disputes concerning community documents.
8. The Department’s jurisdiction under A.R.S. § 32-2199.01(A) does not extend to disputes that implicate the rights of third parties. Because the Petitioner’s request would affect the property interests of the Golf Course Owner and a 2015 legal settlement, the Department was not statutorily authorized to resolve the issue.
9. The Judge suggested three potential remedies: elect a new HOA board that will better protect members’ interests, file a lawsuit in a judicial forum against both the HOA and the Golf Course Owner, or ask the state legislature to amend the relevant statutes governing HOAs and community documents.
10. The Commissioner of the Department of Real Estate adopted the Administrative Law Judge’s recommendation in a Final Order dated May 11, 2017. The Commissioner accepted the decision that the Department lacked jurisdiction and ordered that the Petitioner’s complaint be dismissed.
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Essay Questions
The following questions are designed to encourage a deeper analysis of the case. No answers are provided.
1. Analyze the distinction between a “community document” and the REMA as presented in this case. Why was this distinction the pivotal point in the Administrative Law Judge’s decision to recommend dismissal for lack of jurisdiction?
2. Discuss the procedural history of the dispute over the golf course property, beginning with the REMA amendments in 2011 and including the 2014 litigation, the 2015 settlement, and the 2016 rezoning. How did these prior events impact the arguments and outcome of Gronlund’s 2017 petition?
3. Explain the conflict between the powers granted to the HOA Board and Golf Course Owner in REMA Article 12 and the protections afforded to homeowners in the same article’s reference to CC&Rs Section 14.2. How did the Petitioner and Respondent interpret these clauses differently?
4. Evaluate the legal reasoning behind the Administrative Law Judge’s conclusion that the Department of Real Estate lacked jurisdiction over third parties like the Golf Course Owner. Why would resolving Gronlund’s petition necessarily implicate the rights of this third party?
5. The Judge outlines three potential remedies for the Petitioner: electoral, judicial, and legislative. Describe each of these remedies and discuss the potential challenges and benefits of each path in seeking to protect the golf course from development.
——————————————————————————–
Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
A judge who presides over administrative hearings at a government agency, in this case, the Office of Administrative Hearings (OAH). The ALJ in this matter was Diane Mihalsky.
A.R.S. (Arizona Revised Statutes)
The collection of all the laws passed by the Arizona state legislature. Specific statutes, such as A.R.S. § 32-2199.01(A) and § 33-1802(2), were central to this case.
CC&Rs (Declaration of Covenants, Conditions and Restrictions)
The primary governing legal documents for a planned community or homeowners’ association that outline the rules and member obligations.
Commissioner
The head of a government department. In this case, Judy Lowe, the Commissioner of the Arizona Department of Real Estate, issued the Final Order.
Community Documents
As defined by A.R.S. § 33-1802(2), these include a planned community’s declaration (CC&Rs), bylaws, articles of incorporation, and rules. The REMA was determined not to fall under this definition.
Dismissed with Prejudice
A legal term for a final judgment that prevents the plaintiff from filing another case on the same claim. The 2014 lawsuit between the HOA and the Golf Course Owner was dismissed with prejudice.
Golf Course Owner
A separate legal entity that owned the golf course property and was a primary party to the REMA, but was not a party to this administrative case.
• HOA (Homeowners Association) | An organization in a subdivision or planned community that creates and enforces rules for the properties within its jurisdiction. In this case, the Cottonfields Community Association. | | Jurisdiction | The official power to make legal decisions and judgments. The central legal issue of the case was whether the Arizona Department of Real Estate had jurisdiction over the dispute. | | Motion for Summary Judgment | A request made by a party asking the court to decide a case in their favor without a full trial, arguing that there are no material facts in dispute and that they are entitled to win as a matter of law. | | Office of Administrative Hearings (OAH) | An independent Arizona state agency that conducts evidentiary hearings for other state agencies to ensure fair and impartial decisions. | | Petitioner | The party who files a petition or brings an action before a court or administrative body. In this case, Kurt Gronlund. | | REMA (Reciprocal Easement and Maintenance Agreement) | A recorded legal agreement between the original developer/HOA and the Golf Course Owner that established mutual rights, easements, and obligations, including the critical use restriction on the golf course property. | | Respondent | The party against whom a petition is filed or an appeal is brought. In this case, the Cottonfields Community Association. |
Blog Post – 17F-H1716024-REL
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17F-H1716024-REL
2 sources
The provided sources consist of an Administrative Law Judge Decision and a subsequent Final Order from the Arizona Department of Real Estate concerning a dispute between homeowner Kurt Gronlund, the Petitioner, and the Cottonfields Community Association, the Respondent. The administrative law judge recommended granting the Association’s motion for summary judgment because the Department of Real Estate lacked jurisdiction over the matter, a recommendation which the Commissioner ultimately accepted. The core of the conflict was Gronlund’s petition challenging the Association’s 2011 amendments to a Reciprocal Easement and Maintenance Agreement (REMA), which governed the use of a golf course adjacent to the community. The decision clarified that the REMA was not classified as a “community document” under the relevant statutes, and furthermore, the requested relief would improperly implicate the rights of the Golf Course Owner, a third party over whom the Department had no authority. The final ruling therefore dismissed the petition, suggesting judicial action or legislative change as alternative remedies for the petitioner.
Case Participants
Petitioner Side
Kurt Gronlund(petitioner)
Respondent Side
Troy B. Stratman(attorney) Stratman Law Firm, PLC
Neutral Parties
Diane Mihalsky(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Abby Hansen(HOA Coordinator) Arizona Department of Real Estate Responsible for processing rehearing requests and listed on ADRE service email list.
LDettorre(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
djones(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
jmarshall(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
ncano(administrative staff) Arizona Department of Real Estate Email contact listed ([email protected])
The Commissioner accepted the ALJ decision granting the Respondent's Motion for Summary Judgment, recommending dismissal of the petition due to the Department's lack of statutory jurisdiction over the dispute, which involved a Reciprocal Easement and Maintenance Agreement (REMA) and the rights of a third-party Golf Course Owner.
Why this result: The Department lacked jurisdiction to resolve the dispute because the REMA was not considered a 'community document' under A.R.S. § 33-1802(2) and the requested relief implicated the rights of a non-party (the Golf Course Owner) over whom the Department has no jurisdiction.
Key Issues & Findings
Jurisdiction over REMA Amendment Dispute
Petitioner sought a finding that REMA Amendments 2 and 3 were void because the HOA board unilaterally amended the REMA without the required member vote (two-thirds majority) as specified in the CC&Rs and REMA, and sought an order for the removal of the amendments from the record.
Orders: The Administrative Law Judge recommended granting Respondent's Motion for Summary Judgment and dismissing the Complaint.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
CC&Rs 14.2
REMA Article 12
Analytics Highlights
Topics: jurisdiction, summary judgment, golf course, REMA, third party
Additional Citations:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
A.R.S. § 32-2199.02(A)
CC&Rs 14.2
REMA 5.1
REMA Article 12
Audio Overview
Decision Documents
17F-H1716024-REL Decision – 563660.pdf
Uploaded 2025-10-08T06:57:25 (99.8 KB)
17F-H1716024-REL Decision – 568840.pdf
Uploaded 2025-10-08T06:57:26 (854.5 KB)
Briefing Doc – 17F-H1716024-REL
Briefing Document: Gronlund vs. Cottonfields Community Association (Case No. 17F-H1716024-REL)
Executive Summary
This document synthesizes the legal proceedings and decision in the case of Kurt Gronlund versus the Cottonfields Community Association, adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute centers on the petitioner’s allegation that the Homeowners Association (HOA) board improperly amended a critical land-use agreement in 2011 without a required vote of the membership, ultimately enabling the commercial rezoning of an adjacent golf course.
The Administrative Law Judge (ALJ) granted the HOA’s motion for summary judgment, and the Commissioner of the Arizona Department of Real Estate adopted this decision, dismissing the petition. The dismissal was not based on the merits of the petitioner’s claim but on a crucial lack of jurisdiction. The ALJ determined that the Department of Real Estate could not rule on the matter for two primary reasons:
1. The governing agreement in question (the REMA) is not a “community document” as defined by the relevant Arizona statute, placing it outside the Department’s purview.
2. The relief sought by the petitioner would directly implicate the property rights of a third party (the Golf Course Owner) and a prior legal settlement, which exceeds the Department’s statutory authority.
While acknowledging the petitioner’s concerns about the golf course development may be “well-founded,” the decision concluded that the petitioner’s available remedies lie in electing a new HOA board, filing a lawsuit in a judicial forum, or seeking legislative change.
Case Overview
This case involves a dispute between a homeowner and his HOA regarding the amendment of a land-use agreement governing a golf course property.
Parties Involved
Name / Entity
Description
Petitioner
Kurt Gronlund
A homeowner within the Cottonfields community and a member of the Respondent association.
Respondent
Cottonfields Community Association
The Homeowners Association (HOA) for the Cottonfields development.
Third Party
The Golf Course Owner
A separate legal entity that owns the golf course property adjacent to the community.
Case Chronology
• December 11, 2001: The developer records both the Reciprocal Easement and Maintenance Agreement (REMA) and the community’s CC&Rs.
• March 2011: The Cottonfields HOA board votes 3-2 to amend the REMA.
• March 3 & May 16, 2011: Amendments 2 and 3 to the REMA, which alter the legal description of the golf course property, are officially recorded.
• 2014: Litigation (Case No. CV2014-000639) begins in Maricopa County Superior Court between the HOA and the Golf Course Owner regarding the REMA and its amendments.
• July 2015: The HOA and the Golf Course Owner execute a settlement agreement.
• August 7, 2015: The superior court lawsuit is dismissed with prejudice.
• October 5, 2016: The HOA president represents to the City Council that homeowners favor rezoning the golf course. The Council approves a rezone from “GC” (Golf Course) to Commercial, relying on the 2011 REMA amendments.
• February 3, 2017: Kurt Gronlund files a Homeowners Association Dispute Process Petition with the Arizona Department of Real Estate.
• April 27, 2017: The HOA files a Motion for Summary Judgment, arguing a lack of jurisdiction.
• May 10, 2017: Oral arguments on the motion are held.
• May 11, 2017: The Administrative Law Judge issues a decision recommending dismissal.
• May 11, 2017: The Commissioner of the Department of Real Estate issues a Final Order adopting the ALJ’s decision and dismissing the case.
Core Dispute: Unilateral Amendment of the REMA
The petitioner’s case is founded on the claim that the HOA board acted in violation of its own governing documents when it facilitated changes to the REMA without consulting the community’s homeowners.
Petitioner’s Allegations
On February 3, 2017, Kurt Gronlund filed a petition asserting that the HOA board’s actions in 2011 were illegal and directly led to the loss of protection for homeowner property values.
• The Unilateral Action: The petition states, “[In] March 2011 the HOA board voted 3-2 to unilaterally amend REMA 5.1’s use restriction on the golf course property without the required vote of the approximately 450 eligible class members…”
• The Consequence: These amendments were used as justification for the HOA president to support a commercial rezoning of the golf course property before the City Council on October 5, 2016. The petitioner argues this “stripped away that last layer of protection” for homeowners who believed the golf course could not be developed without their approval.
• Homeowner Reliance: During oral arguments, the petitioner testified that members relied on the protections within the CC&Rs and REMA when purchasing their homes, believing development required a two-thirds majority vote.
Petitioner’s Requested Relief
The petitioner respectfully requested that the Administrative Court issue the following orders:
1. Find that REMA Section 5.1 may not be amended without the member vote required by REMA Article 12 and CC&Rs Section 14.2.
2. Find that Amendments 2 and 3 to the REMA are void and unenforceable.
3. Order the HOA Board to remove Amendments 2 and 3 from the public record.
Analysis of Governing Document Provisions
The dispute hinges on the interpretation of and interaction between two key legal documents: the REMA and the HOA’s CC&Rs.
Document
Section
Description
Key Language
Section 5.1
Use Restriction: Restricts the golf course property’s use to either a golf course or open space.
“The Golf Course Property shall be used solely and exclusively for Golf Course Use or as open space, and for no other purposes.”
Article 12
Amendment Procedure: Stipulates that changes to Section 5.1 require the same member vote as an amendment to the HOA’s Declaration (CC&Rs).
“…no termination, cancellation, change, modification or amendment of paragraph 5.1… shall be made without the written approval thereof by the number of Members… required to amend the Declaration pursuant to Section 13.2 thereof.”
Section 14.2
Member Vote Requirement: Defines the threshold for amending the CC&Rs.
“…may be amended only by the affirmative vote (in person or by proxy) or written consent of: (a) Members holding not less than two-thirds (2/3) of all Class A votes then entitled to be cast; and (b) Members holding not less than two thirds (2/3) of all Class B votes…”
Section 14.17
Third-Party Rights: Protects the rights of the Golf Course Owner, stating that provisions benefiting them cannot be amended without their written consent.
“…no provision of this Declaration… which grants to or confers upon the Golf Course Owner or the Golf Course Property any rights… shall be modified, amended or revoked in any way without the express written consent of the Golf Course Owner.”
Jurisdictional Challenge and Legal Rationale for Dismissal
The HOA’s defense focused not on the factual allegations but on the argument that the Department of Real Estate was the improper forum for this dispute. The ALJ ultimately agreed with this position.
Respondent’s Motion for Summary Judgment
The Cottonfields Community Association argued that the Department could not grant the petitioner’s requested relief because:
1. The REMA is not a “community document” as defined under Arizona law (A.R.S. § 32-2199.01(A)).
2. The Golf Course Owner is a third party over whom the Department lacks jurisdiction.
3. Any ruling would affect the rights of this third party and could impact the 2015 settlement agreement from the superior court case.
Administrative Law Judge’s Conclusions of Law
The ALJ’s decision was based on a strict interpretation of the Department’s statutory authority.
• REMA is Not a “Community Document”: The judge found that although the REMA references the CC&Rs, it does not meet the legal definition of a community document under A.R.S. § 33-1802(2), which defines them as “the declaration, bylaws, articles of incorporation, if any, and rules, if any.” The Department’s authority under A.R.S. § 32-2199.01(A) is limited to violations of these specific documents.
• Implication of Third-Party Rights: The decision states that the petitioner’s request to void the amendments “implicates the Golf Course Owner’s interests in its property and may affect the settlement that the Golf Course Owner entered into with Respondent.” The law does not grant the Department “jurisdiction over disputes that implicate the rights of third parties.”
• Petitioner’s Available Remedies: While validating the petitioner’s underlying worries, the judge outlined specific alternative courses of action. The decision states: “Petitioner’s concerns about development of the golf course may be well-founded. However, under applicable statutes, at this time, his available remedies are to elect a board that will better protect members’ interest in maintaining the golf course, to file suit in a judicial forum against Respondent and the Golf Course Owner, or to ask the legislature to amend A.R.S. §§ 33-1802(2) and 32-2199.01(A).”
Final Order and Disposition
Based on the legal conclusions regarding jurisdiction, the case was dismissed.
• ALJ Recommendation: On May 11, 2017, Administrative Law Judge Diane Mihalsky recommended that the complaint be dismissed.
• Commissioner’s Final Order: On May 11, 2017, Judy Lowe, Commissioner for the Arizona Department of Real Estate, issued a Final Order stating: “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed.”
• Further Action: The Final Order noted that a party may file for a rehearing or review within thirty days, or may appeal the final administrative decision by filing a complaint for judicial review.
The Commissioner accepted the ALJ decision granting the Respondent's Motion for Summary Judgment, recommending dismissal of the petition due to the Department's lack of statutory jurisdiction over the dispute, which involved a Reciprocal Easement and Maintenance Agreement (REMA) and the rights of a third-party Golf Course Owner.
Why this result: The Department lacked jurisdiction to resolve the dispute because the REMA was not considered a 'community document' under A.R.S. § 33-1802(2) and the requested relief implicated the rights of a non-party (the Golf Course Owner) over whom the Department has no jurisdiction.
Key Issues & Findings
Jurisdiction over REMA Amendment Dispute
Petitioner sought a finding that REMA Amendments 2 and 3 were void because the HOA board unilaterally amended the REMA without the required member vote (two-thirds majority) as specified in the CC&Rs and REMA, and sought an order for the removal of the amendments from the record.
Orders: The Administrative Law Judge recommended granting Respondent's Motion for Summary Judgment and dismissing the Complaint.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
CC&Rs 14.2
REMA Article 12
Analytics Highlights
Topics: jurisdiction, summary judgment, golf course, REMA, third party
Additional Citations:
A.R.S. § 32-2199.01(A)
A.R.S. § 33-1802(2)
A.R.S. § 32-2199.02(A)
CC&Rs 14.2
REMA 5.1
REMA Article 12
Audio Overview
Decision Documents
17F-H1716024-REL Decision – 563660.pdf
Uploaded 2025-10-08T07:01:37 (99.8 KB)
17F-H1716024-REL Decision – 568840.pdf
Uploaded 2025-10-08T07:01:38 (854.5 KB)
Briefing Doc – 17F-H1716024-REL
Briefing Document: Gronlund vs. Cottonfields Community Association (Case No. 17F-H1716024-REL)
Executive Summary
This document synthesizes the legal proceedings and decision in the case of Kurt Gronlund versus the Cottonfields Community Association, adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute centers on the petitioner’s allegation that the Homeowners Association (HOA) board improperly amended a critical land-use agreement in 2011 without a required vote of the membership, ultimately enabling the commercial rezoning of an adjacent golf course.
The Administrative Law Judge (ALJ) granted the HOA’s motion for summary judgment, and the Commissioner of the Arizona Department of Real Estate adopted this decision, dismissing the petition. The dismissal was not based on the merits of the petitioner’s claim but on a crucial lack of jurisdiction. The ALJ determined that the Department of Real Estate could not rule on the matter for two primary reasons:
1. The governing agreement in question (the REMA) is not a “community document” as defined by the relevant Arizona statute, placing it outside the Department’s purview.
2. The relief sought by the petitioner would directly implicate the property rights of a third party (the Golf Course Owner) and a prior legal settlement, which exceeds the Department’s statutory authority.
While acknowledging the petitioner’s concerns about the golf course development may be “well-founded,” the decision concluded that the petitioner’s available remedies lie in electing a new HOA board, filing a lawsuit in a judicial forum, or seeking legislative change.
Case Overview
This case involves a dispute between a homeowner and his HOA regarding the amendment of a land-use agreement governing a golf course property.
Parties Involved
Name / Entity
Description
Petitioner
Kurt Gronlund
A homeowner within the Cottonfields community and a member of the Respondent association.
Respondent
Cottonfields Community Association
The Homeowners Association (HOA) for the Cottonfields development.
Third Party
The Golf Course Owner
A separate legal entity that owns the golf course property adjacent to the community.
Case Chronology
• December 11, 2001: The developer records both the Reciprocal Easement and Maintenance Agreement (REMA) and the community’s CC&Rs.
• March 2011: The Cottonfields HOA board votes 3-2 to amend the REMA.
• March 3 & May 16, 2011: Amendments 2 and 3 to the REMA, which alter the legal description of the golf course property, are officially recorded.
• 2014: Litigation (Case No. CV2014-000639) begins in Maricopa County Superior Court between the HOA and the Golf Course Owner regarding the REMA and its amendments.
• July 2015: The HOA and the Golf Course Owner execute a settlement agreement.
• August 7, 2015: The superior court lawsuit is dismissed with prejudice.
• October 5, 2016: The HOA president represents to the City Council that homeowners favor rezoning the golf course. The Council approves a rezone from “GC” (Golf Course) to Commercial, relying on the 2011 REMA amendments.
• February 3, 2017: Kurt Gronlund files a Homeowners Association Dispute Process Petition with the Arizona Department of Real Estate.
• April 27, 2017: The HOA files a Motion for Summary Judgment, arguing a lack of jurisdiction.
• May 10, 2017: Oral arguments on the motion are held.
• May 11, 2017: The Administrative Law Judge issues a decision recommending dismissal.
• May 11, 2017: The Commissioner of the Department of Real Estate issues a Final Order adopting the ALJ’s decision and dismissing the case.
Core Dispute: Unilateral Amendment of the REMA
The petitioner’s case is founded on the claim that the HOA board acted in violation of its own governing documents when it facilitated changes to the REMA without consulting the community’s homeowners.
Petitioner’s Allegations
On February 3, 2017, Kurt Gronlund filed a petition asserting that the HOA board’s actions in 2011 were illegal and directly led to the loss of protection for homeowner property values.
• The Unilateral Action: The petition states, “[In] March 2011 the HOA board voted 3-2 to unilaterally amend REMA 5.1’s use restriction on the golf course property without the required vote of the approximately 450 eligible class members…”
• The Consequence: These amendments were used as justification for the HOA president to support a commercial rezoning of the golf course property before the City Council on October 5, 2016. The petitioner argues this “stripped away that last layer of protection” for homeowners who believed the golf course could not be developed without their approval.
• Homeowner Reliance: During oral arguments, the petitioner testified that members relied on the protections within the CC&Rs and REMA when purchasing their homes, believing development required a two-thirds majority vote.
Petitioner’s Requested Relief
The petitioner respectfully requested that the Administrative Court issue the following orders:
1. Find that REMA Section 5.1 may not be amended without the member vote required by REMA Article 12 and CC&Rs Section 14.2.
2. Find that Amendments 2 and 3 to the REMA are void and unenforceable.
3. Order the HOA Board to remove Amendments 2 and 3 from the public record.
Analysis of Governing Document Provisions
The dispute hinges on the interpretation of and interaction between two key legal documents: the REMA and the HOA’s CC&Rs.
Document
Section
Description
Key Language
Section 5.1
Use Restriction: Restricts the golf course property’s use to either a golf course or open space.
“The Golf Course Property shall be used solely and exclusively for Golf Course Use or as open space, and for no other purposes.”
Article 12
Amendment Procedure: Stipulates that changes to Section 5.1 require the same member vote as an amendment to the HOA’s Declaration (CC&Rs).
“…no termination, cancellation, change, modification or amendment of paragraph 5.1… shall be made without the written approval thereof by the number of Members… required to amend the Declaration pursuant to Section 13.2 thereof.”
Section 14.2
Member Vote Requirement: Defines the threshold for amending the CC&Rs.
“…may be amended only by the affirmative vote (in person or by proxy) or written consent of: (a) Members holding not less than two-thirds (2/3) of all Class A votes then entitled to be cast; and (b) Members holding not less than two thirds (2/3) of all Class B votes…”
Section 14.17
Third-Party Rights: Protects the rights of the Golf Course Owner, stating that provisions benefiting them cannot be amended without their written consent.
“…no provision of this Declaration… which grants to or confers upon the Golf Course Owner or the Golf Course Property any rights… shall be modified, amended or revoked in any way without the express written consent of the Golf Course Owner.”
Jurisdictional Challenge and Legal Rationale for Dismissal
The HOA’s defense focused not on the factual allegations but on the argument that the Department of Real Estate was the improper forum for this dispute. The ALJ ultimately agreed with this position.
Respondent’s Motion for Summary Judgment
The Cottonfields Community Association argued that the Department could not grant the petitioner’s requested relief because:
1. The REMA is not a “community document” as defined under Arizona law (A.R.S. § 32-2199.01(A)).
2. The Golf Course Owner is a third party over whom the Department lacks jurisdiction.
3. Any ruling would affect the rights of this third party and could impact the 2015 settlement agreement from the superior court case.
Administrative Law Judge’s Conclusions of Law
The ALJ’s decision was based on a strict interpretation of the Department’s statutory authority.
• REMA is Not a “Community Document”: The judge found that although the REMA references the CC&Rs, it does not meet the legal definition of a community document under A.R.S. § 33-1802(2), which defines them as “the declaration, bylaws, articles of incorporation, if any, and rules, if any.” The Department’s authority under A.R.S. § 32-2199.01(A) is limited to violations of these specific documents.
• Implication of Third-Party Rights: The decision states that the petitioner’s request to void the amendments “implicates the Golf Course Owner’s interests in its property and may affect the settlement that the Golf Course Owner entered into with Respondent.” The law does not grant the Department “jurisdiction over disputes that implicate the rights of third parties.”
• Petitioner’s Available Remedies: While validating the petitioner’s underlying worries, the judge outlined specific alternative courses of action. The decision states: “Petitioner’s concerns about development of the golf course may be well-founded. However, under applicable statutes, at this time, his available remedies are to elect a board that will better protect members’ interest in maintaining the golf course, to file suit in a judicial forum against Respondent and the Golf Course Owner, or to ask the legislature to amend A.R.S. §§ 33-1802(2) and 32-2199.01(A).”
Final Order and Disposition
Based on the legal conclusions regarding jurisdiction, the case was dismissed.
• ALJ Recommendation: On May 11, 2017, Administrative Law Judge Diane Mihalsky recommended that the complaint be dismissed.
• Commissioner’s Final Order: On May 11, 2017, Judy Lowe, Commissioner for the Arizona Department of Real Estate, issued a Final Order stating: “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed.”
• Further Action: The Final Order noted that a party may file for a rehearing or review within thirty days, or may appeal the final administrative decision by filing a complaint for judicial review.
