Tag Archives: A.A.C. R2-19-119(A)

Charles P Mandela vs. Blue Ridge Estates Homeowners’ Association

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

Case Summary

Case ID 20F-H2020042-REL-RHG
Agency ADRE
Tribunal OAH
Decision Date 2021-04-27
Administrative Law Judge Adam D. Stone
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Charles P Mandela Counsel —
Respondent Blue Ridge Estates Homeowners' Association Counsel Nicholas Nogami, Esq.

Alleged Violations

CC&R Article X; A.R.S. § 41-2198.01

Outcome Summary

The Administrative Law Judge concluded that the Petitioner failed to sustain the burden of proof that the Respondent HOA violated Article X of the CC&R’s regarding the denial of an architectural modification request (patio shade). The Respondent was found to be the prevailing party, and the appeal (rehearing) was dismissed.

Why this result: Petitioner failed to establish a violation of the CC&R's by a preponderance of the evidence. The ALJ concluded the Respondent acted in compliance with the CC&R’s Section 10.2 and 10.3 when denying the request, and Petitioner failed to follow the requisite procedures in Section 10.3 to appeal the denial.

Key Issues & Findings

Denial of request for patio shade structure

Petitioner challenged the HOA's denial of his application to build a patio shade. The HOA denied the request stating that 'Only one structure other than the residence may be placed on the property,' and a shed already existed. Petitioner argued the shade, being attached, was not a stand-alone structure. The ALJ upheld the denial, finding the HOA acted in compliance with CC&Rs Article X, Sections 10.2 and 10.3, and that Petitioner failed to follow appeal procedures outlined in Section 10.3.

Orders: Petitioner's appeal (rehearing request) was dismissed, and Respondent was declared the prevailing party.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 41-2198.01
  • CC&R Article X
  • CC&R Section 10.3
  • A.R.S. § 32-2199.02(A)
  • A.A.C. R2-19-119(A)

Analytics Highlights

Topics: HOA, CC&R, Architectural Review, Denial, Rehearing, Burden of proof
Additional Citations:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 41-2198.01
  • A.R.S. § 32-2199.02(A)
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(2)

Video Overview

Audio Overview

Decision Documents

20F-H2020042-REL-RHG Decision – 876009.pdf

Uploaded 2025-10-09T03:34:51 (118.9 KB)

20F-H2020042-REL-RHG Decision – ../20F-H2020042-REL/850032.pdf

Uploaded 2026-01-20T13:55:35 (113.4 KB)





Briefing Doc – 20F-H2020042-REL-RHG


Briefing on Mandela v. Blue Ridge Estates Homeowners’ Association

Executive Summary

This document synthesizes the findings from two administrative law judge decisions concerning a dispute between homeowner Charles P. Mandela and the Blue Ridge Estates Homeowners’ Association (“Blue Ridge”). The core issue was Blue Ridge’s denial of Mr. Mandela’s request to build a patio shade structure.

In the initial hearing on January 13, 2021, Mr. Mandela argued the denial was erroneous because the shade would be attached to his house, not a separate structure, and that similar structures existed in the community. Blue Ridge defended its decision based on Article X of its Covenants, Conditions, and Restrictions (CC&Rs), which limits properties to one structure besides the main residence. The Administrative Law Judge (ALJ) denied Mr. Mandela’s petition, finding that Blue Ridge acted within the authority granted by its CC&Rs, as its architectural standards were not exhaustive and it provided a reasonably detailed written reason for the denial.

Following this decision, Mr. Mandela was granted a rehearing, which took place on April 16, 2021. During this second hearing, he introduced a new argument that Blue Ridge had violated Article 10.3 of the CC&Rs by failing to respond to his request within the stipulated 30-day timeframe. However, the ALJ found that the same article specifies that a failure to respond results in the request being “deemed disapproved.” The ALJ concluded that Mr. Mandela had failed to follow the subsequent appeal procedures outlined in the CC&Rs and again failed to meet his burden of proof. Consequently, the appeal was dismissed, and Blue Ridge was declared the prevailing party. Notably, during the rehearing, Mr. Mandela testified that his request for the patio shade had since been approved by the Blue Ridge board.

Initial Hearing and Decision (Case No. 20F-H2020042-REL)

The first evidentiary hearing was held on January 13, 2021, before Administrative Law Judge Adam D. Stone to address Mr. Mandela’s petition alleging Blue Ridge violated its CC&Rs.

The Core Dispute

• Petitioner’s Request: On August 28, 2019, Charles P. Mandela submitted a request to build a “patio shade less than 200 sq. feet,” described as a four-post structure he intended to attach to the east wall of his residence.

• Respondent’s Denial: On October 25, 2019, Blue Ridge denied the request, stating: “Only one structure other than the residence may be placed on the property. The site plan that was given for review shows the residence and also a shed on property already existing, this would be the allowable limit per the Architectural Standards.”

Arguments Presented

• Petitioner (Charles P. Mandela):

◦ Argued passionately that the denial was erroneous because the patio shade was to be attached to the house, not a separate, stand-alone structure.

◦ Presented photographs of other properties within Blue Ridge Estates that had multiple structures and stand-alone patio shades similar to his proposal.

• Respondent (Blue Ridge Estates HOA):

◦ Contended it properly followed Article X of the CC&Rs in its denial.

◦ At the hearing, Blue Ridge pointed to Article III of the CC&Rs as justification, classifying the proposed shade as an additional structure on the property.

Judge’s Findings and Conclusions

The Administrative Law Judge (ALJ) denied Mr. Mandela’s petition, concluding he had not established by a preponderance of the evidence that Blue Ridge violated Article X of the CC&Rs.

• Interpretation of CC&R Section 10.2: The judge found that the architectural standards listed in this section were explicitly not exhaustive. The text states standards “may include, without limitation, provisions regarding” aspects like size, design, and placement. This allowed the architectural committee to deny the request based on the “one additional structure” rule, even if not explicitly listed.

• Compliance with CC&R Section 10.3: This section requires the committee to provide “reasonably detailed written reasons for such disapproval.” The judge found that the denial email of October 25, 2019, fulfilled this requirement. The email did not need to cite a specific CC&R section, only to provide an explanation.

• On Precedent and Fairness: The ALJ acknowledged Mr. Mandela’s evidence of similar structures on other properties. However, the decision noted: “While those properties may have had their shades approved by different members of the Blue Ridge Architectural Committee that does not follow that Mr. Mandela’s request was improperly denied under Article X.”

• Final Ruling: The petition was denied in a decision dated January 29, 2021.

Rehearing and Final Decision (Case No. 20F-H2020042-REL-RHG)

Mr. Mandela filed for a rehearing on February 5, 2021, on the grounds that the decision was arbitrary, capricious, or not supported by evidence. The Arizona Department of Real Estate Commissioner granted the request, and a new hearing was held on April 16, 2021.

New Testimony and Arguments

• Petitioner (Charles P. Mandela):

◦ Subsequent Approval: Testified that since the January 29, 2021 decision, his request for the patio shade had been approved by the Blue Ridge board.

◦ Procedural Violation: Argued that Blue Ridge violated CC&R Section 10.3 by failing to respond to his August 28, 2019, request within the required 30-day period, as the denial was not issued until October 25, 2019.

◦ History of Denials: Stated he had made several previous requests in 2018 and 2019 that were either denied or ignored.

◦ Discrimination: Claimed he had been discriminated against due to the previous denials.

• Respondent (Blue Ridge Estates HOA):

◦ Interpretation of Section 10.3: Argued that while the section may be “confusingly drafted,” it stipulates that if the committee fails to respond within 30 days, the request is “deemed disapproved.” Therefore, the board acted within its authority.

◦ Failure to Appeal: Contended that Mr. Mandela failed to follow the proper appeal procedure outlined in the CC&Rs, as he never specifically requested a meeting to discuss the denial.

Judge’s Final Findings and Conclusions

The ALJ affirmed the original decision, finding for the Respondent as the prevailing party and dismissing Mr. Mandela’s appeal.

• Scope of Rehearing: The judge determined that the rehearing was limited to the August 28, 2019, request and its subsequent denial, as that was the sole focus of the original petition. Mr. Mandela’s arguments about prior denials were not considered new evidence relevant to the specific violation alleged.

• Interpretation of the 30-Day Rule: The ALJ sided with the HOA’s interpretation of Section 10.3. While acknowledging that Blue Ridge took more than thirty days to issue a written denial, the judge ruled that the CC&R’s provision for a “deemed disapproved” status meant the request was properly denied under the rules.

• Petitioner’s Failure to Follow Procedure: The judge noted that Mr. Mandela admitted he did not formally request a meeting with the Architectural Committee after the denial, which was the required next step in the appeal process under Section 10.3.

• Final Ruling: The final decision, dated April 27, 2021, concluded that Mr. Mandela failed to sustain his burden of proof. The HOA was found to have acted in compliance with the CC&Rs, and the appeal was dismissed. This order was declared binding on the parties.

Timeline of Key Events

August 28, 2019

Charles Mandela submits his request to build a patio shade.

October 25, 2019

Blue Ridge HOA denies the request via email, citing the one-additional-structure limit.

January 13, 2020

Mandela files a petition with the Arizona Department of Real Estate.

January 13, 2021

The first evidentiary hearing is held before the Office of Administrative Hearings.

January 29, 2021

The Administrative Law Judge (ALJ) issues a decision denying Mandela’s petition.

February 5, 2021

Mandela files a request for a rehearing.

March 15, 2021

The Commissioner of the Department of Real Estate grants the rehearing request.

April 16, 2021

The rehearing is conducted.

April 27, 2021

The ALJ issues a final decision, finding for the HOA and dismissing Mandela’s appeal.

Central CC&R Provision: Article X, Section 10.3

The most heavily debated provision was Section 10.3 of the Blue Ridge Estates CC&Rs, which outlines the procedure for architectural requests. Its language was central to the outcome of the rehearing.

Key text from Section 10.3:

“The Architectural Committee shall have thirty (30) days after receipt of such plans, specifications, and elevations to approve or disapprove of the proposed construction… In the event the Architectural Committee fails either to approve or disapprove the proposed construction… within said thirty (30) day period, such proposed construction… shall be deemed disapproved and the Owner can then request a meeting with the Architectural Committee to discuss the reasons for such disapproval…”

This clause was interpreted by the ALJ to mean that the HOA’s failure to provide a written response within 30 days automatically constituted a denial, shifting the burden to the homeowner to request a follow-up meeting, a step Mr. Mandela did not take.






Study Guide – 20F-H2020042-REL-RHG


Study Guide: Mandela v. Blue Ridge Estates Homeowners’ Association

This study guide provides a comprehensive review of the administrative legal dispute between homeowner Charles P. Mandela and the Blue Ridge Estates Homeowners’ Association, as detailed in the Administrative Law Judge Decisions from January 29, 2021, and April 27, 2021. The case centers on the denial of an architectural request and the interpretation of the association’s governing documents (CC&Rs).

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Quiz: Key Facts and Arguments

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

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

2. What specific structure did Charles P. Mandela request approval to build on August 28, 2019?

3. What was the initial reason given by the Blue Ridge Estates HOA for denying Mr. Mandela’s request on October 25, 2019?

4. What was Mr. Mandela’s central argument during the first hearing on January 13, 2021?

5. According to the decision from the first hearing, why did the Administrative Law Judge rule that the HOA’s denial was in compliance with Section 10.2 of the CC&Rs?

6. On what grounds did Mr. Mandela file his Homeowner’s Association (HOA) Dispute Rehearing Request on February 5, 2021?

7. During the rehearing, what new argument did Mr. Mandela raise concerning the timeline of the HOA’s denial of his August 28, 2019 request?

8. How did the HOA’s legal counsel counter Mr. Mandela’s argument regarding the 30-day response time outlined in Section 10.3?

9. What procedural step, outlined in Section 10.3, did Mr. Mandela admit he failed to take after his request was deemed denied?

10. What was the final outcome of the rehearing on April 16, 2021, and what was the judge’s conclusion regarding the HOA’s actions?

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Answer Key

1. The primary parties were Petitioner Charles P. Mandela, a homeowner, and Respondent Blue Ridge Estates Homeowners’ Association of Coconino County. Mr. Mandela filed the petition against the HOA after it denied his request to build a patio shade.

2. On August 28, 2019, Mr. Mandela requested approval to build a “patio shade less than 200 sq. feet.” The structure was a four-post shade that he intended to attach to the east side wall of his residence.

3. The HOA denied the request based on Architectural Committee Standards Article X. The denial stated that only one structure other than the residence may be placed on the property, and Mr. Mandela already had a residence and a shed.

4. Mr. Mandela’s central argument was that the denial was erroneous because the patio shade was not a separate stand-alone structure. He planned to attach it to his house, and he presented photographs of other properties with similar structures.

5. The judge ruled the denial complied with Section 10.2 because the list of standards the Architectural Committee could enforce was “not an exhaustive one.” This meant the committee could properly deny the request based on the one-structure limit, even if it wasn’t explicitly enumerated.

6. Mr. Mandela requested a rehearing on the grounds that the findings of fact were arbitrary, capricious, or an abuse of discretion. He also claimed the decision was not supported by the evidence or was contrary to law.

7. During the rehearing, Mr. Mandela argued that the Board violated Section 10.3 of the CC&Rs. He contended that since he made his request on August 28, 2019, and the Board did not respond until October 25, 2019, it had failed to provide a written response within the required 30-day period.

8. The HOA’s counsel argued that while Section 10.3 may be “confusingly drafted,” it specifies that if the committee fails to approve or disapprove within the 30-day period, the request is “deemed disapproved.” Therefore, the Board was within its authority.

9. Mr. Mandela admitted that he did not formally request a meeting with the Architectural Committee to discuss the reasons for the disapproval. This is the procedural step required by Section 10.3 after a request is deemed denied.

10. The final outcome was that the petition was dismissed, and the Respondent (HOA) was declared the prevailing party. The judge concluded that the HOA had not violated the CC&Rs and had acted in compliance with its governing documents.

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Essay Questions for Further Study

The following questions are designed to promote a deeper analysis of the case. Formulate a comprehensive response to each, citing specific details from the legal decisions.

1. Analyze the interpretation of CC&R Section 10.3, specifically the “deemed disapproved” clause. Discuss how this clause functioned as a key legal defense for the HOA and ultimately shaped the outcome of the rehearing.

2. The legal standard in this case was “a preponderance of the evidence.” Define this standard as described in the legal text and evaluate the evidence Mr. Mandela presented in both hearings. Why did the Administrative Law Judge conclude that Mr. Mandela failed to meet his burden of proof?

3. Compare and contrast the arguments presented by the Petitioner and Respondent in the initial hearing (January 13, 2021) versus the rehearing (April 16, 2021). How did the focus of the legal arguments shift between the two proceedings?

4. Examine the authority and jurisdiction of the Architectural Committee as outlined in CC&R Section 10.2. Discuss the significance of the phrase “Such standards and procedures may include, without limitation, provisions regarding…” in the judge’s initial decision.

5. Trace the procedural history of this case, from Mr. Mandela’s initial request in August 2019 to the final order in April 2021. Identify at least four key procedural milestones and explain their significance to the case’s progression and ultimate resolution.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An independent judge, in this case Adam D. Stone, who presides over hearings at the Office of Administrative Hearings and makes decisions on petitions concerning disputes regulated by state agencies.

Architectural Committee

A body within the Blue Ridge Estates HOA established by Article X of the CC&Rs, with jurisdiction over all original construction and any modifications, additions, or alterations to the exterior of homes or properties.

Arizona Department of Real Estate

The state agency authorized by statute to receive and decide petitions for hearings from members of homeowners’ associations and the associations themselves in Arizona.

Burden of Proof

The obligation of a party in a legal proceeding to produce evidence that proves the facts it claims are true. In this case, the Petitioner (Mr. Mandela) bore the burden of proof.

An abbreviation for Covenants, Conditions, and Restrictions, which are the governing legal documents for a planned community like Blue Ridge Estates. This case centered on the interpretation of Article X of the Blue Ridge CC&Rs.

Homeowners’ Association (HOA)

The governing organization for a planned community. In this case, the Respondent was the Blue Ridge Estates Homeowners Association of Coconino County.

Motion to Dismiss

A formal request filed by a party asking for a lawsuit or petition to be dismissed. The Blue Ridge HOA filed a Motion to Dismiss, which was denied on October 7, 2020, allowing the case to proceed.

Office of Administrative Hearings

An independent state agency in Arizona where petitions related to disputes with HOAs are sent for an evidentiary hearing before an Administrative Law Judge.

Petitioner

The party who files a petition initiating a legal action. In this case, Charles P. Mandela was the Petitioner.

Preponderance of the Evidence

The standard of proof required in this case. It is defined as “such proof as convinces the trier of fact that the contention is more probably true than not,” representing the greater weight of evidence.

Rehearing

A second hearing granted to review a legal decision. Mr. Mandela was granted a rehearing after the initial decision, based on his claim that the findings were arbitrary, capricious, or not supported by evidence.

Respondent

The party against whom a petition is filed. In this case, the Blue Ridge Estates Homeowners’ Association was the Respondent.

Tribunal

A term used in the documents to refer to the judicial body hearing the case, specifically the Office of Administrative Hearings and the presiding Administrative Law Judge.






Blog Post – 20F-H2020042-REL-RHG


He Fought the HOA Over a Patio and Lost. Here Are 5 Shocking Lessons Every Homeowner Needs to Learn.

Introduction: The Perils of a Simple Home Improvement Project

For any homeowner, the excitement of a new project—a deck, a fence, or a simple patio shade—can quickly turn to frustration when it collides with the dense rulebook of a Homeowners’ Association (HOA). What seems like a straightforward improvement can become a complex battle of bylaws and procedures.

This was the reality for Charles P. Mandela, a homeowner in the Blue Ridge Estates community. His plan to build a simple patio shade was denied by his HOA, sparking a legal challenge that went before an Administrative Law Judge. While Mr. Mandela ultimately lost his case on its legal merits, the details of his fight offer a masterclass in the surprising and often counter-intuitive world of HOA governance. This article distills the most shocking lessons from his case, providing critical insights for any homeowner living under an HOA.

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1. The “Deemed Disapproved” Clause: How an HOA’s Silence Becomes a Legal “No”

Mr. Mandela submitted his request to build a patio shade on August 28, 2019. He argued that the HOA, Blue Ridge Estates, violated its own rules, which required a response within 30 days. The HOA didn’t send its formal denial until October 25, 2019, well past the deadline. On the surface, it seemed like a clear procedural violation by the HOA.

However, a bizarre and “unartfully drafted” clause hidden in the HOA’s governing documents (CC&Rs) turned this logic on its head. The rule stated:

In the event the Architectural Committee fails either to approve or disapprove the proposed construction… within said thirty (30) day period, such proposed construction… shall be deemed disapproved…

Contrary to common sense, the rule meant that the HOA’s failure to respond on time resulted in an automatic denial, not a pending approval. The Administrative Law Judge was bound by this text, concluding that because the 30-day period had passed without a formal approval, the request was “properly deemed denied.”

2. The “My Neighbor Has One” Argument Is Weaker Than You Think

To support his case, Mr. Mandela presented photographs showing that “similar shades exist on other properties with additional structures.” He argued that the HOA was engaging in selective enforcement by denying his project while having approved others like it. This is one of the most frequent arguments homeowners make when they feel singled out by their HOA board.

The judge’s conclusion was a stunning reality check. The legal decision stated:

While those properties may have had their shades approved by different members of the Blue Ridge Architectural Committee that does not follow that Mr. Mandela’s request was improperly denied under Article X.

The legal reasoning here is crucial for homeowners to understand. Architectural committees are not static; members change, and so can their interpretation of aesthetic standards. Each application is legally considered a distinct request, evaluated under the rules in place at that moment. A previous committee’s approval—which may have even been a mistake or a variance granted under different circumstances—does not create a binding legal precedent that forces the current committee to repeat it.

3. Procedure is Everything: A Missed Step Can Cost You the Case

The HOA’s rules contained a specific process for appealing a denial. After a project is “deemed disapproved” because the 30-day clock ran out, the homeowner must then formally request a meeting with the committee to discuss the denial.

The judge found that Mr. Mandela had failed to take this critical next step. This procedural misstep, however small it might seem, became a key factor in the case against him. The decision hinged on this procedural failure, stating:

Further, Petitioner admitted that in his several email responses that he did not formally request a meeting with the Architectural Committee, thus he failed to follow the procedures in Section 10.3.

This highlights a crucial lesson: meticulously follow every single procedural step outlined in your HOA’s documents. Failure to do so, such as not using the correct language to request a meeting, can be used to dismiss your claim, regardless of its other merits.

4. “Unartfully Drafted” Rules Can Still Be Legally Binding

Even the Administrative Law Judge acknowledged the poor quality of the HOA’s rulebook. In the decision, the judge offered a candid assessment of the rule regarding the 30-day response time, stating, “Admittedly this section is unartfully drafted…”

Despite this observation, the rule was enforced exactly as written. The judge was bound by the text, however confusing, and concluded that “from the evidence presented, the request was properly deemed denied.”

This is perhaps the most sobering lesson. Homeowners often assume that a rule that is confusing or seems illogical won’t hold up under scrutiny. This case proves that the literal text of the governing documents possesses immense power. What a rule literally says is far more important than what one might assume it should mean.

5. The Final Twist: He Lost the Case But Got His Patio Anyway

After the initial decision was made against him, Mr. Mandela requested a rehearing. During this second hearing, a surprising fact emerged. Mr. Mandela testified that “since the decision on January 29, 2021, his request for the patio shade had been approved by the Board.”

This outcome highlights a crucial dynamic: while Mr. Mandela lost the legal argument based on procedural history, his persistent engagement in the process—including filing a formal appeal—likely created enough administrative and community pressure to compel the Board to find a practical, non-legal solution. It’s a powerful reminder that a legal loss on a technicality does not always foreclose a real-world victory.

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Conclusion: Do You Really Know Your HOA’s Rules?

The case of Charles Mandela serves as a powerful cautionary tale. It reveals that HOA disputes are rarely won on appeals to fairness or common sense. Instead, they are won or lost in the fine print of the governing documents—documents that can contain counter-intuitive clauses, procedural traps, and “unartfully drafted” rules that are nonetheless legally binding.

A homeowner’s best defense is not passion or conviction, but a deep and thorough understanding of the specific rules and procedures they agreed to live by. This case forces every homeowner to ask: Are you prepared to navigate the literal text of your community’s rules, where silence can mean “no” and a neighbor’s precedent is no precedent at all?


Case Participants

Petitioner Side

  • Charles P Mandela (petitioner)

Respondent Side

  • Nicholas Nogami (HOA attorney)
    CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP

Neutral Parties

  • Adam D. Stone (ALJ)
    Office of Administrative Hearings
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate

Charles P Mandela vs. Blue Ridge Estates Homeowners’ Association

Posted on by

Case Summary

Case ID 20F-H2020042-REL-RHG
Agency ADRE
Tribunal OAH
Decision Date 2021-04-27
Administrative Law Judge Adam D. Stone
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Charles P Mandela Counsel —
Respondent Blue Ridge Estates Homeowners' Association Counsel Nicholas Nogami, Esq.

Alleged Violations

CC&R Article X; CC&R Section 10.3

Outcome Summary

The Administrative Law Judge, following a rehearing, affirmed the original decision, concluding that the Petitioner failed to sustain the burden of proof that the Respondent HOA violated CC&R Article X regarding the denial of an architectural modification request for a patio shade. The Respondent was found to have acted in compliance with the community documents, and the appeal was dismissed.

Why this result: Petitioner failed to meet the burden of proof to establish a violation of the CC&R's and failed to follow the procedural requirements necessary to appeal a deemed disapproval under CC&R Section 10.3.

Key Issues & Findings

Denial of request for patio shade structure and alleged violation of response timeline

Petitioner challenged the HOA's denial of his application for a patio shade, arguing the denial was improper because the shade would be attached (not a separate structure) and that the HOA missed the 30-day response deadline. The ALJ determined that the HOA's denial based on the 'only one structure other than the residence' rule (since a shed already existed) complied with the non-exhaustive Architectural Committee Standards (Article X, 10.2). Regarding the delayed response, the ALJ noted that Section 10.3 mandated that a late response results in the request being 'deemed disapproved,' and the Petitioner failed to subsequently request the required appeal meeting.

Orders: The Administrative Law Judge concluded that Petitioner failed to sustain the burden of proof that the Respondent violated Article X of the CC&R’s. The Respondent was declared the prevailing party, and the Petitioner's appeal (rehearing) was dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 41-2198.01
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-2199.02(A)
  • CC&R Article X
  • CC&R Section 10.3

Analytics Highlights

Topics: HOA, CC&R, Architectural Review, Denial, Rehearing, Burden of Proof, Deemed Disapproved
Additional Citations:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 41-2198.01
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-2199.02(A)

Decision Documents

20F-H2020042-REL Decision – 850032.pdf

Uploaded 2025-12-17T18:18:33 (113.4 KB)

Case Participants

Petitioner Side

  • Charles P Mandela (petitioner)
    Appeared on his own behalf via Google Meet

Respondent Side

  • Nicholas Nogami (HOA attorney)
    CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
    Appeared on behalf of Respondent

Neutral Parties

  • Adam D. Stone (ALJ)
    Office of Administrative Hearings
    Issued the decision for the original hearing and the rehearing
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate
    Issued an Order Granting Rehearing

Carla J Snyder v. Las Hadas Villas Association

Posted on by

Case Summary

Case ID 21F-H2121032-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-04-07
Administrative Law Judge Sondra J. Vanella
Outcome loss
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Carla J. Snyder Counsel —
Respondent Las Hadas Villas Association Counsel David Potts

Alleged Violations

CC&Rs 14.2

Outcome Summary

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to establish the HOA violated CC&R 14.2. The evidence demonstrated that the damages occurred in an exclusive use area that the homeowner is responsible for maintaining, and that the HOA had adequately maintained the roof.

Why this result: The damage was located on a patio/pergola which under CC&R 14.1 is an exclusive use area for which the homeowner holds maintenance responsibility, not the HOA.

Key Issues & Findings

Association's Responsibility

Petitioner alleged the HOA violated CC&R 14.2 by failing to repair and take responsibility for $11,476.00 in damages resulting from an improperly constructed roof without flashing.

Orders: Petitioner's petition is dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 32-2199
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.09

Decision Documents

21F-H2121032-REL Decision – 870534.pdf

Uploaded 2026-02-28T18:23:48 (121.6 KB)

Here is a concise summary of the requested legal hearing:

**Case Title**: *Carla J. Snyder v. Las Hadas Villas Association* (No. 21F-H2121032-REL)

**Key Facts & Main Issue**
Petitioner Carla J. Snyder filed a petition with the Arizona Department of Real Estate against the Las Hadas Villas Association (Respondent), alleging a violation of Section 14.2 of the community's Covenants, Conditions, and Restrictions (CC&Rs). The dispute centered on $11,476 in water damage and mold remediation costs incurred by the Petitioner. The Petitioner argued that the damage was caused by a construction flaw—specifically, a lack of flashing on the roof—and asserted that the roof was the Homeowners Association's (HOA) responsibility to maintain and repair.

**Hearing Proceedings & Key Arguments**
* **Petitioner’s Arguments:** The Petitioner presented testimony from a general contractor who stated that the absence of roof flashing allowed water to permeate the garage and patio, classifying it as a design flaw. The Petitioner explicitly sought a "finding of negligence" against the HOA regarding the roof's construction to aid in a future civil lawsuit.
* **Respondent’s Arguments:** The HOA argued that a finding of negligence was outside the statutory purview of the administrative hearing. Relying on Section 14.1 of the CC&Rs, the Respondent noted that while the HOA is responsible for the roof, the homeowner is strictly responsible for "exclusive use" areas, which include patios and pergolas. The HOA provided maintenance logs showing the roof was repaired and fitted with proper flashing in 2015, as well as an independent 2019 inspection confirming the roof underlayment was in good condition and that the leak was an "old issue". Furthermore, the Respondent presented evidence that the unit's previous owner had experienced pergola damage but refused to replace the rotted wood, instead hiring a contractor to simply cover the rot with stucco.

**Most Important Legal Points**
* **Burden of Proof:** Under Arizona law, the Petitioner bore the burden of proving the alleged CC&R violations by a preponderance of the evidence.
* **Interpretation of CC&Rs:** The Administrative Law Judge (ALJ) utilized a plain reading of the CC&Rs, confirming that the patio and pergola are subject to the homeowner

Case Participants

Petitioner Side

  • Carla J. Snyder (petitioner)
    Appeared on her own behalf
  • Ray Odom (witness)
    General contractor who performed mold remediation and drywall repairs
  • Dr. John Gilderbloom (witness)
    University of Louisville
    Professor and Petitioner's fiancé

Respondent Side

  • David Potts (HOA attorney)
    Las Hadas Villas Association
  • Tonia Reynolds (property manager)
    Las Hadas Villas Association
    Testified as a witness for Respondent

Neutral Parties

  • Sondra J. Vanella (ALJ)
    OAH
  • Tom Reynolds (witness)
    99 Home Improvements
    Lead for 99 Home Improvements; provided an affidavit
  • Judy Lowe (commissioner)
    Arizona Department of Real Estate

Carlos J Sanchez & Marinda K Minch, vs. Tempe Villages Homeowners

Posted on by

Case Summary

Case ID 21F-H2121033-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-03-09
Administrative Law Judge Sondra J. Vanella
Outcome none
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Carlos J. Sanchez & Marinda K. Minch Counsel —
Respondent Tempe Villages Homeowners Association, Inc. Counsel Ashley Moscarello

Alleged Violations

Bylaws Article 4 Section 1

Outcome Summary

The Petition was dismissed because Petitioners failed to prove the Respondent HOA violated the Bylaws regarding the filling of a vacant Board seat. The ALJ determined the Bylaws did not impose a timeframe for filling the vacancy and the Board acted according to Article IV, Section 3.

Why this result: Petitioners failed to meet the burden of proof to establish the violation by a preponderance of the evidence. The Bylaws do not contain a provision providing a timeframe in which a vacancy on the Board must be filled.

Key Issues & Findings

Violation of Bylaws regarding Board of Directors composition and appointment

Petitioners alleged the HOA violated Bylaws Article 4 Section 1 by leaving a Board seat open following a resignation (August 2020) and not filling it until November 2020. The ALJ found the Bylaws (Sections 1, 2, and 3) did not mandate a timeframe for filling a vacancy, and the HOA followed procedures for appointment.

Orders: Petitioners’ Petition is dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 32-2199
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
  • A.A.C. R2-19-119(B)(2)
  • MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
  • BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.09

Analytics Highlights

Topics: HOA Governance, Board of Directors, Bylaws, Board Vacancy
Additional Citations:

  • A.R.S. § 32-2199
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
  • A.A.C. R2-19-119(B)(2)
  • MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
  • BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.09

Video Overview

Audio Overview

Decision Documents

21F-H2121033-REL Decision – 862059.pdf

Uploaded 2026-01-23T17:36:41 (132.3 KB)

Questions

Question

If a Board member resigns, does the HOA have to hold an election to fill the seat?

Short Answer

Not necessarily. Bylaws may allow the remaining Board members to appoint a successor for the unexpired term.

Detailed Answer

In this case, the Bylaws explicitly stated that in the event of a resignation, the remaining Board members select the successor. The ALJ found that the Board was not required to put this seat up for a general election, distinguishing it from seats with expiring terms.

Alj Quote

In the event of death, resignation or removal of a director, his successor shall be selected by the remaining members of the Board and shall serve for the unexpired term of his predecessor.

Legal Basis

Bylaws Article IV, Section 3

Topic Tags

  • Board Vacancies
  • Elections
  • Bylaws

Question

Is there a specific deadline for the Board to fill a vacant seat after a resignation?

Short Answer

Only if the governing documents specify one. If the Bylaws are silent, there is no strict timeframe.

Detailed Answer

The ALJ ruled that because the community's Bylaws did not specify a deadline, the HOA did not violate the rules by waiting several months (from August to November) to fill the vacancy.

Alj Quote

The Bylaws do not contain a timeframe in which the Board must appoint a successor director after the resignation of a director.

Legal Basis

Bylaws Interpretation

Topic Tags

  • Board Vacancies
  • Timelines
  • Bylaws

Question

Can the Community Manager appoint or remove Board members?

Short Answer

No. The authority to appoint or remove directors typically lies with the Board or the membership, not the manager.

Detailed Answer

The Community Manager testified that they lacked the authority to make such appointments, confirming that this power resides with the Board itself.

Alj Quote

Mr. Nurse further testified that he does not have the authority to appoint or remove members of the Board.

Legal Basis

Testimony / Findings of Fact

Topic Tags

  • Community Manager
  • Authority
  • Board Composition

Question

What is the 'burden of proof' for a homeowner suing their HOA in an administrative hearing?

Short Answer

The homeowner (Petitioner) must prove the violation by a 'preponderance of the evidence'.

Detailed Answer

This legal standard requires the homeowner to show that their claims are 'more probably true than not.' It is not enough to simply make an allegation; superior evidentiary weight is required.

Alj Quote

Petitioner bears the burden of proof to establish that Respondent committed the alleged violation by a preponderance of the evidence.

Legal Basis

A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A)

Topic Tags

  • Legal Standards
  • Burden of Proof
  • Evidence

Question

Can I force the Board to hold a vote for a vacant seat if the term hasn't expired yet?

Short Answer

Generally, no. If the term is unexpired, it may not be eligible for a member vote if the Bylaws provide for appointment.

Detailed Answer

The ALJ accepted the explanation that a seat vacated by resignation was not eligible for the general member vote because the original term had not yet expired (it ran until 2022), whereas other seats were up for election because their terms had ended.

Alj Quote

Mr. Nurse explained that the term for the Board member who resigned does not expire until 2022, and as such was not eligible for a member vote.

Legal Basis

Findings of Fact / Bylaws

Topic Tags

  • Elections
  • Board Terms
  • Voting

Question

Does personal dislike or bias by the Board constitute a violation of the Bylaws?

Short Answer

Not on its own. The homeowner must prove a specific violation of the governing documents.

Detailed Answer

Although the homeowner claimed the Board disliked her and was trying to keep her out, the ALJ dismissed the petition because the HOA followed the technical requirements of the Bylaws regarding elections and appointments.

Alj Quote

Petitioners failed to prove by a preponderance of the evidence that Respondent violated the Bylaws as alleged in the Petition.

Legal Basis

Conclusions of Law

Topic Tags

  • Discrimination/Bias
  • Enforcement
  • Board Conduct

Case

Docket No
21F-H2121033-REL
Case Title
Carlos J. Sanchez & Marinda K. Minch v. Tempe Villages Homeowners Association, Inc.
Decision Date
2021-03-09
Alj Name
Sondra J. Vanella
Tribunal
OAH
Agency
ADRE

Questions

Question

If a Board member resigns, does the HOA have to hold an election to fill the seat?

Short Answer

Not necessarily. Bylaws may allow the remaining Board members to appoint a successor for the unexpired term.

Detailed Answer

In this case, the Bylaws explicitly stated that in the event of a resignation, the remaining Board members select the successor. The ALJ found that the Board was not required to put this seat up for a general election, distinguishing it from seats with expiring terms.

Alj Quote

In the event of death, resignation or removal of a director, his successor shall be selected by the remaining members of the Board and shall serve for the unexpired term of his predecessor.

Legal Basis

Bylaws Article IV, Section 3

Topic Tags

  • Board Vacancies
  • Elections
  • Bylaws

Question

Is there a specific deadline for the Board to fill a vacant seat after a resignation?

Short Answer

Only if the governing documents specify one. If the Bylaws are silent, there is no strict timeframe.

Detailed Answer

The ALJ ruled that because the community's Bylaws did not specify a deadline, the HOA did not violate the rules by waiting several months (from August to November) to fill the vacancy.

Alj Quote

The Bylaws do not contain a timeframe in which the Board must appoint a successor director after the resignation of a director.

Legal Basis

Bylaws Interpretation

Topic Tags

  • Board Vacancies
  • Timelines
  • Bylaws

Question

Can the Community Manager appoint or remove Board members?

Short Answer

No. The authority to appoint or remove directors typically lies with the Board or the membership, not the manager.

Detailed Answer

The Community Manager testified that they lacked the authority to make such appointments, confirming that this power resides with the Board itself.

Alj Quote

Mr. Nurse further testified that he does not have the authority to appoint or remove members of the Board.

Legal Basis

Testimony / Findings of Fact

Topic Tags

  • Community Manager
  • Authority
  • Board Composition

Question

What is the 'burden of proof' for a homeowner suing their HOA in an administrative hearing?

Short Answer

The homeowner (Petitioner) must prove the violation by a 'preponderance of the evidence'.

Detailed Answer

This legal standard requires the homeowner to show that their claims are 'more probably true than not.' It is not enough to simply make an allegation; superior evidentiary weight is required.

Alj Quote

Petitioner bears the burden of proof to establish that Respondent committed the alleged violation by a preponderance of the evidence.

Legal Basis

A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A)

Topic Tags

  • Legal Standards
  • Burden of Proof
  • Evidence

Question

Can I force the Board to hold a vote for a vacant seat if the term hasn't expired yet?

Short Answer

Generally, no. If the term is unexpired, it may not be eligible for a member vote if the Bylaws provide for appointment.

Detailed Answer

The ALJ accepted the explanation that a seat vacated by resignation was not eligible for the general member vote because the original term had not yet expired (it ran until 2022), whereas other seats were up for election because their terms had ended.

Alj Quote

Mr. Nurse explained that the term for the Board member who resigned does not expire until 2022, and as such was not eligible for a member vote.

Legal Basis

Findings of Fact / Bylaws

Topic Tags

  • Elections
  • Board Terms
  • Voting

Question

Does personal dislike or bias by the Board constitute a violation of the Bylaws?

Short Answer

Not on its own. The homeowner must prove a specific violation of the governing documents.

Detailed Answer

Although the homeowner claimed the Board disliked her and was trying to keep her out, the ALJ dismissed the petition because the HOA followed the technical requirements of the Bylaws regarding elections and appointments.

Alj Quote

Petitioners failed to prove by a preponderance of the evidence that Respondent violated the Bylaws as alleged in the Petition.

Legal Basis

Conclusions of Law

Topic Tags

  • Discrimination/Bias
  • Enforcement
  • Board Conduct

Case

Docket No
21F-H2121033-REL
Case Title
Carlos J. Sanchez & Marinda K. Minch v. Tempe Villages Homeowners Association, Inc.
Decision Date
2021-03-09
Alj Name
Sondra J. Vanella
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Carlos J. Sanchez (petitioner)
    Candidate for Board election
  • Marinda K. Minch (petitioner)
    Candidate for Board election; considered for vacancy appointment; testified

Respondent Side

  • Ashley Moscarello (HOA attorney)
    Goodman Lawgroup
  • Bradley Hudson (board member)
    Tempe Villages Homeowners Association, Inc. Board
    President of the Board; testified as witness
  • Shawn Nurse (community manager)
    Tempe Villages Homeowners Association, Inc.
    Testified as witness; received ballots for election
  • William Skanadore (board member)
    Tempe Villages Homeowners Association, Inc. Board
    Incumbent candidate; elected
  • Will Terrick (board member)
    Tempe Villages Homeowners Association, Inc. Board
    Incumbent candidate; elected
  • Wendelyn Neal (board member)
    Tempe Villages Homeowners Association, Inc. Board
    Made motion to appoint Marinda Minch
  • Joel Krick (board member)
    Tempe Villages Homeowners Association, Inc. Board
  • Kathy Hudson (board member)
    Tempe Villages Homeowners Association, Inc. Board
  • Christiane Pieraggi (board member)
    Tempe Villages Homeowners Association, Inc. Board
    Appointed to fill vacancy

Neutral Parties

  • Sondra J. Vanella (ALJ)
    OAH
  • Judy Lowe (commissioner)
    ADRE

Other Participants

  • John Neelsen (unknown)
    Candidate for Board election
  • Tania Almonte (board member)
    Tempe Villages Homeowners Association, Inc. Board
    Former Board member whose resignation created a vacancy
  • Ruby (witness assistant)
    Aided in counting votes

Lee & Kim Edwards v. Scottsdale Embassy Condominium Association

Posted on by

Case Summary

Case ID 21F-H2120028-REL-RHG
Agency ADRE
Tribunal OAH
Decision Date 2021-07-28
Administrative Law Judge Velva Moses-Thompson
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Lee & Kim Edwards Counsel Terry Foster, Esq.
Respondent Scottsdale Embassy Condominium Association Counsel —

Alleged Violations

A.R.S. § 33-1255

Outcome Summary

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to prove by a preponderance of the evidence that the Respondent violated its CC&Rs, Bylaws, or A.R.S. § 33-1255, ruling that the statute was inapplicable due to the specific provisions in the Declaration regarding the 1/26 assessment calculation.

Why this result: Petitioner failed to meet the burden of proof, and the ALJ determined A.R.S. § 33-1255 was superseded by the Declaration, which mandated assessments based on the undivided 1/26 interest in the common elements.

Key Issues & Findings

Assessment calculation based on undivided interest in common areas

Petitioner challenged the Association's decision to change assessments from a historical square footage basis to a 1/26 interest calculation, arguing that this method violates A.R.S. § 33-1255 by charging for limited common elements (patios/parking).

Orders: The petition of Lee & Kim Edwards is dismissed; Respondent is deemed the prevailing party.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 33-1255
  • Declaration Article I, Section 5
  • Declaration Article II, Section 5
  • Declaration Article II, Section 7
  • Declaration Article IV, Section 4
  • Declaration Article VI, Section 9

Analytics Highlights

Topics: condominium, assessment, cc&r, statutory interpretation, common elements, limited common elements
Additional Citations:

  • A.R.S. § 32-2199(1)
  • A.R.S. § 33-1255
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • Vazanno v. Superior Court, 74 Ariz. 369
  • Powell v. Washburn, 211 Ariz. 553
  • Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs., 867 P.2d 70

Video Overview

Audio Overview

Decision Documents

21F-H2120028-REL Decision – 856603.pdf

Uploaded 2025-12-09T10:06:35 (98.1 KB)

21F-H2120028-REL Decision – 899379.pdf

Uploaded 2025-10-09T03:36:38 (123.6 KB)





Briefing Doc – 21F-H2120028-REL


Assessment Methodology Dispute: Edwards v. Scottsdale Embassy Condominium Association

Executive Summary

This document provides a comprehensive analysis of the legal dispute between homeowners Lee & Kim Edwards (Petitioners) and the Scottsdale Embassy Condominium Association (Respondent) concerning a change in the methodology for calculating homeowner assessments. The core of the conflict was the Association’s decision to shift from a historical practice of assessments based on unit square footage to a uniform rate where each of the 26 units pays an equal 1/26 share of the common expenses.

The dispute was adjudicated by an Administrative Law Judge (ALJ) in two separate hearings. In both instances, the ALJ ruled in favor of the Association, dismissing the petitions filed by the Edwards.

Key Takeaways:

• Change in Methodology: The Association’s Board, acting on legal advice received in January 2020, concluded that its 40-year practice of using a square-footage-based assessment violated the community’s Covenants, Conditions, and Restrictions (CC&Rs). The Board subsequently implemented a 1/26 equal-share assessment method after a majority of homeowners selected this option.

• Initial Ruling on “Uniform Rate”: In the first hearing in February 2021, the Petitioners argued that the historical square footage method was a “uniform rate” and that the Association had waived its right to change the long-standing practice. The ALJ rejected this, finding that the new 1/26 rate complied with the CC&Rs’ requirement for a “uniform rate” (Article VI, Section 9) and aligned with each unit’s specified 1/26 undivided interest in the common elements (Article VI, Section 4(d)).

• Rehearing Ruling on State Statute: The Petitioners were granted a rehearing in July 2021, where they argued that the 1/26 method violated Arizona statute A.R.S. § 33-1255 by improperly charging all owners for “limited common elements” like patios and parking spaces. The ALJ again ruled against the Petitioners, concluding that the state statute did not apply. The ruling was based on a key provision in the statute: “Unless otherwise provided for in the declaration.” The judge found that the Association’s Declaration did provide otherwise by defining patios and parking as general common elements and explicitly mandating that costs be shared based on each unit’s 1/26 interest.

• Final Outcome: The petition was definitively dismissed after the rehearing, making the ALJ’s order binding. The Association’s adoption of the 1/26 assessment rate was upheld as compliant with its governing documents.

——————————————————————————–

Background of the Dispute

The legal conflict originated from a single-issue petition filed on November 20, 2020, by Lee and Kim Edwards, owners of unit 6937 in the Scottsdale Embassy Condominium development. The petition, filed with the Arizona Department of Real Estate, alleged that the Scottsdale Embassy Condominium Association had violated its CC&Rs, specifically Article VI, Section 9, and Article IV, Section 1.

The central issue was the Association Board’s decision to change the long-standing method of calculating homeowner assessments. For over 40 years, assessments had been based on the square footage of each unit. In 2020, the Board implemented a new system where the Association’s annual budget was divided equally among the 26 units, with each owner paying a 1/26 share. The Petitioners sought to enforce the historical calculation method unless and until the CC&Rs were properly amended.

Chronology of the Assessment Change

• Historical Practice: For more than four decades, the Association calculated and charged member assessments based on the square footage of each condominium unit.

• Legal Consultation (January 2020): Two members of the Association’s Board consulted with an attorney regarding the legality of the historical assessment method.

• Attorney Recommendation (January 24, 2020): The attorney advised the Association that, to ensure compliance with the CC&Rs, it should calculate assessments based on each homeowner’s 1/26 interest in the common areas. The attorney’s letter stated:

• Homeowner Consultation: Following the legal advice, the Board informed homeowners that the prior square-footage method violated the CC&Rs. The Board sought input on three potential assessment methods: the 1/26 rate, a variable blended rate, or continuing with the square footage rate. A majority of homeowners selected the 1/26 rate. The Board noted that any method other than the 1/26 rate would require a formal amendment to the CC&Rs.

• Implementation (September 26, 2020): The Board officially notified homeowners that it would begin charging assessments based on the 1/26 rate and that an amendment to the CC&Rs was not necessary to implement this change.

Initial Hearing and Decision (February 2021)

An evidentiary hearing was held on February 9, 2021, before Administrative Law Judge Velva Moses-Thompson.

Arguments Presented

Petitioners (Edwards)

1. The historical square footage rate qualified as a “uniform rate” and was compliant with the CC&Rs.
2. By using the square footage rate for over 40 years, the Association had waived its right to enforce a different method like the 1/26 rate.

Respondent (Association)

1. The plain language of the CC&Rs requires that each homeowner pay an assessment based on the 1/26 rate.
2. It is not legally possible to waive a mandatory CC&R requirement through past practice.

On February 19, 2021, the ALJ issued a decision dismissing the petition. The judge’s conclusions of law were based on a direct interpretation of the CC&Rs:

• Uniform Rate Compliance: The ALJ determined that the “preponderance of the evidence” showed that the Association’s 1/26 rate was a uniform rate that complied with Article VI, Section 9 of the CC&Rs.

• Burden of Proof: The Petitioners failed to meet their burden to prove that the Association had violated its governing documents.

• Outcome: The Association was deemed the prevailing party, and the petition was dismissed.

Rehearing and Final Decision (July 2021)

The Petitioners filed a request for a rehearing on March 30, 2021, which was granted. The rehearing was held on July 8, 2021. The Respondent did not appear at this hearing, as its counsel had withdrawn from representation without formally notifying the tribunal.

In the rehearing, the Petitioners introduced a new argument, alleging that the 1/26 assessment method violated Arizona state law, specifically A.R.S. § 33-1255.

• The core of this argument was that the 1/26 rate improperly included charges for “limited common elements,” such as patios and assigned parking spaces.

• The Petitioners contended that this forced all homeowners to pay for the maintenance of elements that were assigned to and benefited fewer than all units, in direct violation of the statute.

On July 28, 2021, the ALJ issued a final decision, once again dismissing the petition. The ruling hinged on the precise wording of both the state statute and the Association’s Declaration.

• Applicability of A.R.S. § 33-1255: The judge found that the statute did not apply to this matter. The relevant section of the law, A.R.S. § 33-1255(C), begins with the critical phrase: “Unless otherwise provided for in the declaration…”

• Supremacy of the Declaration: The ALJ concluded that the Association’s Declaration did provide otherwise. The CC&Rs explicitly:

◦ Define “Common Elements” broadly to include patios and parking areas (Article I, Section 3).

◦ Establish that each unit has an “undivided interest in the general common areas” of 1/26 (Article I, Section 5).

◦ Mandate that each unit’s share of costs for repair and maintenance of common areas is the “same as its undivided interest in the common elements” (Article IV, Section 4(d)).

• Final Outcome: Because the Declaration’s specific provisions overrode the general terms of the state statute, the Association was found to be in compliance. The petition was dismissed, and the order was deemed binding on the parties.

Key Legal Principles and Definitions

Concept

Definition / Application in Case

Burden of Proof

The Petitioners were required to establish their claim by a “preponderance of the evidence.”

Preponderance of the Evidence

Defined as “proof as convinces the trier of fact that the contention is more probably true than not.” The ALJ found the Petitioners failed to meet this standard in both hearings.

Restrictive Covenants

Arizona law requires that unambiguous restrictive covenants be enforced to give effect to the parties’ intent and be interpreted as a whole. The ALJ’s decisions were based on a direct interpretation of the CC&Rs’ language.

Common Elements (per CC&Rs)

A broad definition including multifamily structures, land, roofs, ceilings, foundations, storage spaces, patios, parking areas, recreational facilities, lawns, pipes, and conduits.

Unit (per CC&Rs)

A freehold estate consisting of the interior space of an apartment. The definition explicitly states that common elements are not part of the unit.

Undivided Interest (per CC&Rs)

Article I, Section 5 clearly establishes that “The undivided interest in the general common areas… which shall be conveyed with each respective units shall be 1/26.” This provision was central to the final ruling.






Study Guide – 21F-H2120028-REL


Study Guide: Edwards v. Scottsdale Embassy Condominium Association

This study guide provides a comprehensive review of the administrative case between Lee & Kim Edwards and the Scottsdale Embassy Condominium Association, based on the provided legal decisions. It includes a short-answer quiz, an answer key, suggested essay questions, and a detailed glossary of key terms.

Short-Answer Quiz

Answer the following questions in two to three sentences each, based on the information provided in the case documents.

1. What was the central conflict between the Petitioners (Lee & Kim Edwards) and the Respondent (Scottsdale Embassy Condominium Association)?

2. For over 40 years, how did the Association historically calculate assessments for homeowners?

3. What specific event in January 2020 prompted the Association’s Board to change the assessment method?

4. In the first hearing on February 9, 2021, what were the two main arguments presented by Mr. Edwards?

5. What was the Administrative Law Judge’s conclusion regarding the “uniform rate” requirement from CC&Rs Article VI, Section 9 in the initial decision?

6. Upon what new legal grounds did the Petitioners base their March 30, 2021, request for a re-hearing?

7. According to the CC&Rs, what is the defined undivided interest in the general common areas for each unit?

8. Why did the Administrative Law Judge ultimately conclude that Arizona Revised Statutes (A.R.S.) § 33-1255 did not apply in this case?

9. What legal standard of proof did the Petitioners need to meet to successfully prove their case?

10. What was the final, binding outcome of the re-hearing held on July 8, 2021?

——————————————————————————–

Answer Key

1. The central conflict concerned the method for calculating homeowner assessments. The Petitioners argued for the historical method based on unit square footage, while the Respondent implemented a new method where each of the 26 units paid an equal share (1/26 rate) of the Association’s costs.

2. For over 40 years, the Association historically calculated assessments based on the square footage of each condominium unit. This practice was changed by the Board in 2020.

3. In January 2020, two Board members met with an attorney who advised that to comply with the CC&Rs, the Association should charge assessments based on each homeowner’s 1/26 interest in the common areas, not on square footage.

4. Mr. Edwards argued that the historical square footage rate was a “uniform rate” that complied with the CC&Rs. He also contended that by using this method for 40 years, the Association had waived its right to enforce a different assessment method like the 1/26 rate.

5. The Judge concluded that the Respondent’s assessment method, based on a uniform rate of 1/26 of the Association’s costs for each unit, did comply with Article VI, Section 9. Therefore, the Petitioners failed to prove the Association had violated the CC&Rs.

6. The Petitioners based their request for a re-hearing on the new allegation that the Respondent had violated Arizona Revised Statutes (A.R.S.) § 33-1255. They argued the 1/26 rate improperly required members to pay for limited common elements, such as patios and parking spaces, not assigned to them.

7. According to Article I, Section 5 of the Declaration (CC&Rs), the undivided interest in the general common areas established and conveyed with each respective unit is 1/26.

8. The Judge concluded that A.R.S. § 33-1255 did not apply because the statute itself contains an exception: “Unless otherwise provided for in the declaration.” In this case, the Association’s Declaration explicitly required that each member be charged an assessment equivalent to their 1/26 interest in the total costs, which included patios and parking areas.

9. The Petitioners bore the burden of proof to establish their claims by a “preponderance of the evidence.” This standard requires proof that convinces the trier of fact that a contention is more probably true than not.

10. Following the re-hearing, the Administrative Law Judge again ordered that the petition of Lee & Kim Edwards be dismissed. The Respondent was deemed the prevailing party, and the order was declared binding on the parties.

——————————————————————————–

Essay Questions

The following questions are designed for longer, essay-style responses. Answers are not provided.

1. Trace the evolution of the Petitioners’ legal strategy from the initial petition filed on November 20, 2020, to the arguments made during the re-hearing on July 8, 2021. How did their core arguments change, and what new evidence or legal statutes were introduced?

2. Analyze the concept of a “uniform rate” as required by Article VI, Section 9 of the CC&Rs. Discuss how both the Petitioners and the Respondent interpreted this phrase to support their respective assessment methods (square footage vs. 1/26 rate).

3. Explain in detail the role of A.R.S. § 33-1255 in the re-hearing. Why did the Petitioners believe it supported their case, and what specific language in both the statute and the Association’s Declaration led the Administrative Law Judge to rule that it did not apply?

4. Evaluate the actions taken by the Association’s Board of Directors in 2020. Consider their consultation with an attorney, their communication with homeowners, and their final decision to implement the 1/26 rate. Discuss whether these actions were consistent with the powers and obligations outlined in the CC&Rs.

5. Discuss the legal argument of “waiver” raised by Mr. Edwards in the first hearing. Explain what he meant by this and why the Association’s 40-year history of using a square-footage-based assessment was central to this claim. Why did this argument ultimately fail?

——————————————————————————–

Glossary of Key Terms

Definition

1/26 Rate

The assessment method where the Association’s annual budget is divided 26 ways, with each unit responsible for paying an equal portion. This is based on each unit’s 1/26 undivided interest in the common areas as specified in the CC&Rs.

Administrative Law Judge (ALJ)

The independent judicial officer who presides over administrative hearings, hears evidence, and issues a decision. In this case, the ALJ was Velva Moses-Thompson.

A.R.S. § 32-2199(1)

The Arizona Revised Statute that permits a condominium unit owner to file a petition with the Department of Real Estate for a hearing regarding alleged violations of the Condominium Act.

A.R.S. § 33-1255

The Arizona Revised Statute concerning common expenses. It states that unless the declaration provides otherwise, expenses for a limited common element shall be assessed against the units to which it is assigned, and expenses benefitting fewer than all units shall be assessed exclusively against the units benefitted.

Arizona Department of Real Estate

The state agency authorized by statute to receive and decide Petitions for Hearings from members of condominium associations in Arizona.

Burden of Proof

The obligation on a party in a legal proceeding to establish its claims by a required standard of evidence. In this case, the Petitioners bore the burden of proof.

CC&Rs (Covenants, Conditions, and Restrictions)

The governing legal documents that set up the guidelines for a planned community or condominium. Also referred to as the “Declaration” in the provided documents.

Common Area / Common Elements

As defined in Article I, Section 3 of the CC&Rs, this includes the multifamily structure (except for the units), land, air space, bearing walls, roofs, storage spaces, patios, recreational facilities, lawns, pipes, and other premises designed for common use.

Declaration

Another term for the Covenants, Conditions, and Restrictions (CC&Rs).

Lee & Kim Edwards

The Petitioners in the case and owners of unit 6937 in the Scottsdale Embassy Condominium development.

Office of Administrative Hearings

An independent state agency to which the Department of Real Estate refers petitions for evidentiary hearings.

Petitioners

The party that initiates a legal action or petition. In this case, Lee & Kim Edwards.

Preponderance of the Evidence

The evidentiary standard required to be met by the Petitioners. It is defined as proof that convinces the trier of fact that a contention is “more probably true than not.”

Respondent

The party against whom a petition is filed. In this case, the Scottsdale Embassy Condominium Association.

Restricted Common Area

As defined in Article I, Section 3(b) of the CC&Rs, this refers to a separately designed and exclusive parking area for each unit as assigned by the Board of Directors.

Scottsdale Embassy Condominium Association

The Respondent in the case; the condominium unit owners’ association for the development.

Square Footage Rate

The historical method of calculating assessments for over 40 years, where each unit’s assessment was based on its square footage.

Uniform Rate

A requirement from Article VI, Section 9 of the CC&Rs that states both regular and special assessments must be fixed at a uniform rate for all units. The interpretation of this term was central to the dispute.

As defined in Article I, Section 4 of the CC&Rs, a separately designated freehold estate consisting of the space bounded by the interior surfaces of the perimeter walls, floors, ceilings, windows, and floors of each apartment. It does not include common elements.

Waiver

A legal argument made by the Petitioners that because the Association had charged assessments based on square footage for 40 years, it had relinquished or “waived” its right to enforce a different method.






Blog Post – 21F-H2120028-REL


4 Shocking Lessons from an HOA Lawsuit That Could Upend How You See Your Fees

Introduction: The 40-Year Mistake

If you live in a condominium or a community governed by a Homeowners Association (HOA), you likely operate under a simple assumption: the way things have always been done is the correct and legal way. Monthly fees, maintenance schedules, and community rules that have been in place for decades feel permanent and unassailable. But what if they aren’t?

This was the central question in the case of Lee & Kim Edwards versus the Scottsdale Embassy Condominium Association. For over 40 years, the Association calculated homeowner fees based on the square footage of each unit—a practice that seemed fair and logical, and one that was never questioned by residents.

Then came the twist. In January 2020, after consulting with an attorney, the HOA board announced a shocking revelation: their 40-year-old assessment method was a direct violation of the community’s own governing documents. The board presented the legal findings to the community and sought their input on how to proceed. After being given the choice between the old method, a blended rate, or a new flat-rate fee that complied with the rules, most homeowners voted for the compliant flat-rate system for every single unit, regardless of its size.

Homeowners sued to keep the old method, sparking a legal battle that went all the way to an administrative court. The resulting decisions offer surprising and crucial lessons for every homeowner paying HOA dues. Here are the four most impactful takeaways from the case that could change how you view your own community’s rules.

1. “Past Practice” Means Nothing if It Violates the Rules

The primary argument made by the petitioners, Mr. and Mrs. Edwards, was that the Association had “waived its right” to change the assessment method. After all, by using the square-footage calculation for four decades, hadn’t they established an unbreakable precedent? It seemed like a common-sense argument rooted in history and consistency.

The court, however, completely rejected this line of reasoning. The Administrative Law Judge’s decision was not based on historical practice but on the clear, written rules found in the community’s Covenants, Conditions, and Restrictions (CC&Rs). The Association argued that it’s “not possible to waive the CC&R requirement,” and the court agreed.

The Lesson: This case powerfully demonstrates that tradition or “how things have always been done” cannot override the explicit language of an HOA’s governing documents. The CC&Rs are a contract. The lesson is clear: if your HOA’s practice contradicts its documents, the practice is invalid. The board has a fiduciary duty to follow the written rules, not a 40-year-old mistake.

2. Your CC&Rs Are a Binding Contract—Read Them

Throughout the legal proceedings, the Administrative Law Judge consistently referred back to the specific text of the CC&Rs to make a final decision. The entire case ultimately hinged on the interpretation of a few key sentences written decades ago.

The most critical passage, which decided the outcome, was from Article VI, Section 4(d) of the community’s governing documents:

“Each unit’s share shall be the same as its undivided interest in the common elements of the total amount determined under the subparagraphs (a), (b), (c), and (d) above.” —Scottsdale Embassy Condominium Association CC&Rs, Article VI, Section 4(d)

This single sentence was the linchpin. It explicitly linked each unit’s assessment share to its “undivided interest in the common elements.” Another section of the document, Article I, Section 5, had already established that interest as an equal 1/26 for all 26 units.

The Lesson: This is a classic example of legal cross-referencing in a contract. Section 4(d) provided the instruction (base fees on “undivided interest”), while Article I, Section 5 provided the specific value (1/26). With both parts present and unambiguous, the court had no choice but to enforce them exactly as written, leaving no room for interpretations based on fairness or history. The contract was the contract.

3. A “Uniform Rate” Might Not Mean What You Think

One of the central points of contention was the term “uniform rate.” Article VI, Section 9 of the CC&Rs required that all assessments “must be fixed at a uniform rate for all units.”

The homeowners argued that the square footage rate was, in fact, a “uniform rate”—a consistent price per square foot applied to every unit. It’s an interpretation many of us might find reasonable.

However, the HOA Board and the court had a different interpretation. The judge found that the flat 1/26 rate was the correct interpretation of a “uniform rate” because it was uniformly applied to every unit’s established 1/26 interest in the common areas. In the court’s view, the “rate” being applied uniformly was the 1/26 fraction of the total budget. The fact that this resulted in different dollar amounts for square-footage fees was irrelevant; the legal share was what had to be uniform.

The Lesson: Common-sense terms like “uniform” can have very specific legal meanings within the context of your governing documents. The true definition is found not in a dictionary, but in how the term is defined and applied by the rest of the document’s provisions.

4. Your HOA’s Rules Can Sometimes Override State Law

In a final attempt to overturn the decision, the petitioners filed for a re-hearing. This time, they cited a specific Arizona state law, A.R.S. 33-1255. This statute says that expenses for “limited common elements”—things like assigned patios or parking spaces that only benefit specific units—should be assessed only against those units that benefit from them. The homeowners argued that the new 1/26 flat fee unfairly forced them to pay for their neighbors’ patios and parking spots, a direct violation of state law.

Surprisingly, this argument also failed. The reason is found in the crucial introductory clause of the state law itself: “Unless otherwise provided for in the declaration…”

Because the Scottsdale Embassy’s Declaration did provide otherwise—by explicitly rolling all general and restricted common area costs into the total budget before calculating each unit’s 1/26 share—the community’s own rules legally superseded the default state statute. The judge concluded that the state law “does not apply to this matter because the Declaration requires” a different method.

The Lesson: This is perhaps the most counter-intuitive lesson of all. This demonstrates a key principle of contract law and planned community governance: state statutes often provide a “default” rule for situations a community’s documents don’t address. However, they also grant communities the power to create their own specific rules, which, if legally permissible, will take precedence. Homeowners cannot assume that a state law automatically protects them if their community’s own governing documents have a more specific rule in place.

Conclusion: Are You Sure You Know What You Agreed To?

The central message from the Scottsdale Embassy case is undeniable: in an HOA, the written word is law. The CC&Rs and other governing documents are a binding contract that dictates the rules, regardless of 40 years of history, common-sense assumptions, or even some default state laws. What you believe is fair or standard practice is irrelevant if the document you agreed to upon purchase says otherwise.

This case was decided by a few sentences written decades ago. When was the last time you read your community’s governing documents from cover to cover?


Case Participants

Petitioner Side

  • Lee Edwards (petitioner, witness)
  • Kim Edwards (petitioner)
  • Teresa H. Foster (petitioner attorney)
    Ellis & Baker, P.C.
    Also referred to as Terri Foster and Terry Foster

Respondent Side

  • Lauren Vie (respondent attorney)
    Appeared for initial hearing; later noted as withdrawn
  • Caleb Koch (board president, witness)
    Scottsdale Embassy Condominium Association
  • Mary Edinburgh (board member, witness)
    Scottsdale Embassy Condominium Association
  • Beth Mulcahy (respondent attorney)
    Mulcahy Law Firm, PC
    Recipient of transmission; noted as withdrawn counsel prior to rehearing

Neutral Parties

  • Velva Moses-Thompson (ALJ)
    OAH
  • Judy Lowe (commissioner)
    Arizona Department of Real Estate
  • LDettorre (ADRE staff)
    Arizona Department of Real Estate
    Electronic transmission recipient
  • AHansen (ADRE staff)
    Arizona Department of Real Estate
    Electronic transmission recipient
  • djones (ADRE staff)
    Arizona Department of Real Estate
    Electronic transmission recipient
  • DGardner (ADRE staff)
    Arizona Department of Real Estate
    Electronic transmission recipient
  • ncano (ADRE staff)
    Arizona Department of Real Estate
    Electronic transmission recipient

Other Participants

  • Miranda Alvarez (unknown)
    Associated with transmission for petitioner's attorney

Aaron Ricks (Somerstone Properties, LLC), v. Montelena Master

Posted on by

Case Summary

Case ID 21F-H2120024-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-02-16
Administrative Law Judge Tammy L. Eigenheer
Outcome none
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Aaron Ricks (Somerstone Properties, LLC) Counsel —
Respondent Montelena Master Community Association Counsel Troy Stratman

Alleged Violations

A.R.S. § 33-442, A.R.S. § 33-1806

Outcome Summary

The Administrative Law Judge dismissed the Petition because the Petitioner failed to meet the burden of proof to establish that the Montelena Master Community Association violated A.R.S. § 33-442 or its CC&Rs regarding the imposition of a transfer fee. The ALJ found that the use of the fee to fund operating expenses and/or reserves was an acceptable purpose under the relevant statute.

Why this result: Petitioner failed to establish Respondent acted in violation of the community documents and A.R.S. § 33-442.

Key Issues & Findings

Challenge to unauthorized/unlawful transfer fees charged by HOA

Petitioner alleged that the $2500.00 transfer fee charged to the purchaser was an unlawful transfer fee in violation of A.R.S. § 33-442 and specific CC&R provisions, arguing that the authorized use of the fee (Master Association’s operating expenses and/or reserves) was not specific enough to meet the statutory exception under A.R.S. § 33-442(C).

Orders: Petitioner’s petition is dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 33-1806
  • A.R.S. § 33-442
  • A.R.S. § 32-2199
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)

Analytics Highlights

Topics: HOA transfer fee, A.R.S. 33-442, CC&R violation, Operating expenses, Reserves
Additional Citations:

  • A.R.S. § 33-1806
  • A.R.S. § 33-442
  • A.R.S. § 32-2199
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.09
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)

Video Overview

Audio Overview

Decision Documents

21F-H2120024-REL Decision – 855401.pdf

Uploaded 2026-01-23T17:36:12 (95.8 KB)

Questions

Question

Who is responsible for proving that an HOA violated the law or community documents during a hearing?

Short Answer

The homeowner (Petitioner) bears the burden of proof.

Detailed Answer

In an administrative hearing, the homeowner filing the petition must prove that the HOA committed the alleged violations. This must be established by a 'preponderance of the evidence,' meaning the homeowner's claims are more likely true than not.

Alj Quote

Petitioner bears the burden of proof to establish that Respondent committed the alleged violations by a preponderance of the evidence.

Legal Basis

A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1)

Topic Tags

  • burden of proof
  • legal procedure
  • evidence

Question

Can an HOA charge a transfer fee that is used for general operating expenses rather than a specific project?

Short Answer

Yes, funding operating expenses or reserves is considered a valid purpose.

Detailed Answer

Under Arizona law (A.R.S. § 33-442), transfer fees are generally prohibited unless they fall under specific exceptions. One exception is if the fee is used for a purpose authorized in the document. The ALJ ruled that using fees for 'operating expenses and/or… reserves' satisfies this requirement; it does not need to be for a specific limited purpose like a swimming pool.

Alj Quote

Petitioner offered no authority to support his interpretation that A.R.S. § 33-442 required that the transfer fee had to be for a more specific purpose than those identified in the governing documents.

Legal Basis

A.R.S. § 33-442(C)

Topic Tags

  • transfer fees
  • operating expenses
  • financial management

Question

Can the HOA Board set the amount of a transfer fee without a vote if the CC&Rs allow it?

Short Answer

Yes, if the CC&Rs grant the Board the authority to set the amount.

Detailed Answer

If the community's Declaration of Covenants, Conditions, and Restrictions (CC&Rs) specifically states that the transfer fee amount is 'to be set by the Board' or established 'from time to time by the Board,' the Board has the authority to determine the fee amount.

Alj Quote

The Master Association may require the new Owner of a Lot or Parcel to pay to the Master Association, or its designated representative, a transfer fee in an amount to be set by the Board . . . .

Legal Basis

CC&Rs Section 6.6; CC&Rs Section 7.15

Topic Tags

  • board authority
  • CC&Rs
  • fees

Question

Can an HOA charge both a Transfer Fee and a Reserve Contribution fee on the same sale?

Short Answer

Yes, an HOA can charge multiple distinct fees if authorized by the governing documents.

Detailed Answer

The ALJ found that a Transfer Fee can be charged in addition to other fees, such as a Reserve Contribution, provided the governing documents (like a Board Resolution or CC&Rs) explicitly state that the fee is in addition to other assessments.

Alj Quote

This Transfer Fee shall be in addition to any other fees and assessments due and payable in relation to the transfer of the property, including, but not limited to, a Reserve Contribution pursuant to Article 6, Section 6.9 of the Declaration.

Legal Basis

Board Resolution (Recorded July 23, 2010)

Topic Tags

  • reserve contribution
  • transfer fees
  • closing costs

Question

What does 'preponderance of the evidence' mean in an HOA dispute?

Short Answer

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

Detailed Answer

This legal standard requires the party with the burden of proof to provide evidence that has 'superior evidentiary weight.' It does not mean removing all doubt, but rather sufficient evidence to incline a fair mind to one side over the other.

Alj Quote

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

Legal Basis

Arizona Law of Evidence § 5

Topic Tags

  • legal definitions
  • evidence
  • standard of proof

Question

Is a transfer fee valid if I purchased the property out of bankruptcy?

Short Answer

Yes, if the CC&Rs require payment immediately upon becoming the owner.

Detailed Answer

The manner of purchase (e.g., out of bankruptcy) does not automatically exempt an owner from transfer fees if the CC&Rs mandate that 'Each person or entity who purchases a Lot… shall pay… immediately upon becoming the Owner.'

Alj Quote

Therefore, Respondent was able to charge Petitioner the transfer fee pursuant to his purchase of the property out of bankruptcy.

Legal Basis

CC&Rs Section 7.15

Topic Tags

  • bankruptcy
  • property transfer
  • exemptions

Case

Docket No
21F-H2120024-REL
Case Title
Aaron Ricks (Somerstone Properties, LLC) v. Montelena Master Community Association
Decision Date
2021-02-16
Alj Name
Tammy L. Eigenheer
Tribunal
OAH
Agency
ADRE

Questions

Question

Who is responsible for proving that an HOA violated the law or community documents during a hearing?

Short Answer

The homeowner (Petitioner) bears the burden of proof.

Detailed Answer

In an administrative hearing, the homeowner filing the petition must prove that the HOA committed the alleged violations. This must be established by a 'preponderance of the evidence,' meaning the homeowner's claims are more likely true than not.

Alj Quote

Petitioner bears the burden of proof to establish that Respondent committed the alleged violations by a preponderance of the evidence.

Legal Basis

A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1)

Topic Tags

  • burden of proof
  • legal procedure
  • evidence

Question

Can an HOA charge a transfer fee that is used for general operating expenses rather than a specific project?

Short Answer

Yes, funding operating expenses or reserves is considered a valid purpose.

Detailed Answer

Under Arizona law (A.R.S. § 33-442), transfer fees are generally prohibited unless they fall under specific exceptions. One exception is if the fee is used for a purpose authorized in the document. The ALJ ruled that using fees for 'operating expenses and/or… reserves' satisfies this requirement; it does not need to be for a specific limited purpose like a swimming pool.

Alj Quote

Petitioner offered no authority to support his interpretation that A.R.S. § 33-442 required that the transfer fee had to be for a more specific purpose than those identified in the governing documents.

Legal Basis

A.R.S. § 33-442(C)

Topic Tags

  • transfer fees
  • operating expenses
  • financial management

Question

Can the HOA Board set the amount of a transfer fee without a vote if the CC&Rs allow it?

Short Answer

Yes, if the CC&Rs grant the Board the authority to set the amount.

Detailed Answer

If the community's Declaration of Covenants, Conditions, and Restrictions (CC&Rs) specifically states that the transfer fee amount is 'to be set by the Board' or established 'from time to time by the Board,' the Board has the authority to determine the fee amount.

Alj Quote

The Master Association may require the new Owner of a Lot or Parcel to pay to the Master Association, or its designated representative, a transfer fee in an amount to be set by the Board . . . .

Legal Basis

CC&Rs Section 6.6; CC&Rs Section 7.15

Topic Tags

  • board authority
  • CC&Rs
  • fees

Question

Can an HOA charge both a Transfer Fee and a Reserve Contribution fee on the same sale?

Short Answer

Yes, an HOA can charge multiple distinct fees if authorized by the governing documents.

Detailed Answer

The ALJ found that a Transfer Fee can be charged in addition to other fees, such as a Reserve Contribution, provided the governing documents (like a Board Resolution or CC&Rs) explicitly state that the fee is in addition to other assessments.

Alj Quote

This Transfer Fee shall be in addition to any other fees and assessments due and payable in relation to the transfer of the property, including, but not limited to, a Reserve Contribution pursuant to Article 6, Section 6.9 of the Declaration.

Legal Basis

Board Resolution (Recorded July 23, 2010)

Topic Tags

  • reserve contribution
  • transfer fees
  • closing costs

Question

What does 'preponderance of the evidence' mean in an HOA dispute?

Short Answer

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

Detailed Answer

This legal standard requires the party with the burden of proof to provide evidence that has 'superior evidentiary weight.' It does not mean removing all doubt, but rather sufficient evidence to incline a fair mind to one side over the other.

Alj Quote

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

Legal Basis

Arizona Law of Evidence § 5

Topic Tags

  • legal definitions
  • evidence
  • standard of proof

Question

Is a transfer fee valid if I purchased the property out of bankruptcy?

Short Answer

Yes, if the CC&Rs require payment immediately upon becoming the owner.

Detailed Answer

The manner of purchase (e.g., out of bankruptcy) does not automatically exempt an owner from transfer fees if the CC&Rs mandate that 'Each person or entity who purchases a Lot… shall pay… immediately upon becoming the Owner.'

Alj Quote

Therefore, Respondent was able to charge Petitioner the transfer fee pursuant to his purchase of the property out of bankruptcy.

Legal Basis

CC&Rs Section 7.15

Topic Tags

  • bankruptcy
  • property transfer
  • exemptions

Case

Docket No
21F-H2120024-REL
Case Title
Aaron Ricks (Somerstone Properties, LLC) v. Montelena Master Community Association
Decision Date
2021-02-16
Alj Name
Tammy L. Eigenheer
Tribunal
OAH
Agency
ADRE

Case Participants

Petitioner Side

  • Aaron Ricks (petitioner)
    Somerstone Properties, LLC

Respondent Side

  • Troy Stratman (HOA attorney)
    Stratman Law Firm, PLC

Neutral Parties

  • Tammy L. Eigenheer (ALJ)
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate

MICHAEL J. STOLTENBERG v. RANCHO DEL ORO HOMEOWNERS ASSOCIATION

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

Case Summary

Case ID 20F-H2020059-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-02-12
Administrative Law Judge Sondra J. Vanella
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Michael J. Stoltenberg Counsel —
Respondent Rancho Del Oro Homeowners Association Counsel Nicole Payne

Alleged Violations

CC&Rs § 5.1; A.R.S. § 10-3842

Outcome Summary

The Petition was dismissed after rehearing because Petitioner failed to establish by a preponderance of the evidence that the Respondent violated the CC&Rs. The ALJ found that Petitioner continually refused Respondent access to his locked back yard for landscaping maintenance, and the CC&Rs requiring landscaping do not mandate pool maintenance.

Why this result: Petitioner failed to establish a violation due to refusal of access to the back yard and misinterpretation of CC&R obligations regarding pool maintenance.

Key Issues & Findings

Failure to maintain landscaping and acting in bad faith

Petitioner alleged Respondent HOA violated CC&Rs by failing to maintain landscaping in 2020 and acting in bad faith, asserting that pool/hardscape maintenance was included in landscaping duties, and requesting the maximum fine. Respondent countered that they consistently maintained the front yard but were denied access to the locked backyard due to Petitioner's pool liability concerns.

Orders: Petitioner's Petition was dismissed/denied as Petitioner failed to establish a violation by a preponderance of the evidence. However, Respondent was ordered, going forward, to communicate the days and times they will be performing back yard landscaping so Petitioner can provide access.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • CC&Rs § 5.1
  • CC&Rs § 5.1(a)
  • A.R.S. § 10-3842
  • A.R.S. § 32-2199(B)
  • A.R.S. § 33-1803
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-1122(A)(1)
  • A.R.S. § 41-1092.08(H)
  • A.R.S. § 12-904(A)

Analytics Highlights

Topics: HOA Duties, Landscaping, Pool Maintenance, CC&Rs, Access Refusal, Rehearing
Additional Citations:

  • CC&Rs § 5.1
  • CC&Rs § 5.1(a)
  • A.R.S. § 10-3842
  • A.R.S. § 32-2199(B)
  • A.R.S. § 33-1803
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-1122(A)(1)
  • A.R.S. § 41-1092.08(H)
  • A.R.S. § 12-904(A)

Video Overview

Audio Overview

Decision Documents

20F-H2020059-REL-RHG Decision – 855028.pdf

Uploaded 2026-01-23T17:33:28 (139.1 KB)

20F-H2020059-REL-RHG Decision – ../20F-H2020059-REL/815480.pdf

Uploaded 2026-01-23T17:33:31 (124.1 KB)





Briefing Doc – 20F-H2020059-REL-RHG


Briefing on Stoltenberg v. Rancho Del Oro Homeowners Association

Executive Summary

This document synthesizes the findings and rulings from two administrative hearings concerning a dispute between homeowner Michael J. Stoltenberg (Petitioner) and the Rancho Del Oro Homeowners Association (Respondent). The Petitioner alleged the HOA violated its governing documents by failing to maintain landscaping at his property. The case was ultimately dismissed after an initial hearing and a subsequent rehearing.

The core of the dispute centered on two key issues: the scope of “landscaping” services required by the HOA’s Covenants, Conditions, and Restrictions (CC&Rs), and the Petitioner’s denial of access to his backyard. The Petitioner argued that the undefined term “landscaping” in the CC&Rs should be interpreted broadly to include maintenance of his private swimming pool, which he referred to as a “water feature.” Concurrently, he acknowledged keeping his backyard gate locked for liability reasons related to the pool, preventing the HOA’s contractor from performing any work.

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to meet his burden of proof. The judge concluded that the HOA had made repeated, documented attempts to perform its duties, but was actively prevented from doing so by the Petitioner. Critically, the judge ruled that a reasonable interpretation of “landscaping,” supported by dictionary definitions and the Arizona Registrar of Contractors’ distinct licensing classifications for landscaping and swimming pool services, does not include the maintenance of a private pool and its associated mechanical equipment.

I. Case Overview

Case Detail

Information

Case Number

20F-H2020059-REL and 20F-H2020059-REL-RHG (Rehearing)

Petitioner

Michael J. Stoltenberg (Homeowner at 11777 E. Calle Gaudi, Yuma, AZ)

Respondent

Rancho Del Oro Homeowners Association (HOA)

Office of Administrative Hearings, Arizona

Presiding Judge

Administrative Law Judge Sondra J. Vanella

Hearing Dates

August 3, 2020 (Initial Hearing) and February 2, 2021 (Rehearing)

Final Disposition

Petition Dismissed (February 12, 2021)

II. Petitioner’s Allegations and Arguments

The Petitioner filed a petition with the Arizona Department of Real Estate on or about April 21, 2020, alleging the HOA acted in “bad faith” and failed to perform its duties in 2020. The core of his case was built on the following claims:

• Violation of CC&Rs: The Petitioner alleged a violation of § 5.1 of the HOA’s CC&Rs, which mandates that the “Association shall maintain… landscaping on individual Lots outside of structures.” He also alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842, although this was not addressed at the hearing.

• Broad Interpretation of “Landscaping”: The Petitioner contended that since the CC&Rs do not define “landscaping,” the term should encompass all features on his lot. He specifically asserted that the HOA was responsible for maintaining:

◦ His swimming pool (referred to as a “water feature”), including the pump, filter, and chemicals.

◦ His unique xeriscape with geometric patterns.

◦ Walking paths that required staining.

◦ Replenishing decorative rock when it wears thin.

◦ The patio and all hardscape.

• Denial of Access: The Petitioner acknowledged that the gate to his backyard was “always locked for liability reasons” due to the pool. At the rehearing, he argued that the HOA failed to communicate the landscaping schedule, which would have afforded him an opportunity to unlock the gate.

• Rehearing Claims: In his request for a rehearing, the Petitioner cited several grounds, including an abuse of discretion by the judge, errors in evidence, and issues related to the Americans with Disabilities Act (ADA), claiming hearing loss put him at a “severe disadvantage.” At the rehearing itself, he also asserted that the Respondent was “falsely representing themselves as an HOA” and did not have an elected Board.

III. Respondent’s Defense and Evidence

The HOA, represented by Nicole Payne, Esq., argued that it had fulfilled its obligations and that any failure to maintain the Petitioner’s backyard was due to his own actions.

• Consistent Maintenance of Front Yard: The HOA established that its contractor, Mowtown Landscape, had continuously maintained the Petitioner’s front yard since their contract began in January 2020.

• Denied Access to Backyard: The central defense was that the HOA’s contractor was repeatedly and deliberately denied access to the backyard. This was supported by substantial evidence:

◦ Testimony of Rian Baas (Mowtown Landscape): Mr. Baas testified that his crews were at the community every Wednesday and Thursday. He stated they knocked on the Petitioner’s door and left notes or business cards four or five times between January and March 2020.

◦ Testimony of Diana Crites (Property Manager): Ms. Crites presented a text message from Mr. Baas dated March 24, 2020, which read:

◦ Documentary Evidence: A photograph of the locked gate was submitted, along with a letter from Mr. Baas stating, “There is a lock on the gate going to the back yard and we were trying to see if they [sic] people inside the house wanted us to maintenance the back yard. No one ever answered or came to the door.”

• Scope of HOA Services: Ms. Crites testified that the HOA provides uniform services (front yard maintenance, mowing and blowing of back yards, sprinkler system maintenance) and does not offer “concierge” services like maintaining potted plants or private pools. The community pool, she noted, is maintained by a different company entirely (Crystal Clear Pool Maintenance).

IV. Judicial Findings and Legal Rulings

Administrative Law Judge Sondra J. Vanella found in favor of the Respondent in both the initial decision and the rehearing, ultimately dismissing the petition.

Initial Decision (August 17, 2020)

The initial petition was denied because the Petitioner failed to meet the burden of proof. The judge’s reasoning was:

1. Denial of Access: The Petitioner’s own admission, coupled with “credible, probative, and substantial evidence,” established that he had refused to allow the HOA access to his backyard since January 2020.

2. HOA Attempts: The evidence demonstrated that the HOA had attempted to access the yard on multiple occasions and was “specifically instructed in March 2020, that Respondent was not permitted to access Petitioner’s back yard.”

3. Scope of CC&Rs: The judge concluded that while § 5.1(a) of the CC&Rs requires the HOA to maintain yards, “nothing therein requires Respondent to maintain an individual member’s pool.”

Rehearing Decision (February 12, 2021)

After the Commissioner of the Department of Real Estate granted a rehearing, Judge Vanella again dismissed the petition, providing a more detailed legal analysis of the term “landscaping.”

1. Burden of Proof: The judge reiterated that the Petitioner bore the burden to establish that the HOA was legally obligated to maintain his pool, but “failed to establish by a preponderance of the evidence that Respondent must do so.”

2. Definition of “Landscaping”: The judge found that the definitions of “landscaping” from various sources, including dictionaries, “cannot reasonably be read to include a swimming pool and the associated mechanical equipment.”

3. State Licensing as Key Differentiator: The most definitive part of the ruling relied on the Arizona Registrar of Contractors’ licensing classifications, which treat landscaping and pool maintenance as two separate and distinct services.

License Classification

Description & Relevance

R-21 Hardscaping and Irrigation Systems (Formerly Landscaping and Irrigation Systems)

Allows for installation and repair of non-loadbearing concrete, patios, decorative walls, irrigation systems, and water features not attached to swimming pools. The classification specifically precludes the licensee from contracting for work on “swimming pools, pool deck coatings.”

R-6 Swimming Pool Service and Repair

A separate license required “to service and perform minor repair of residential pools and accessories.”

The judge concluded: “The Registrar’s licensing scheme supports a conclusion that landscaping maintenance and pool maintenance are two separate and distinct services… the CC&Rs cannot reasonably be interpreted to include pool maintenance when it required Respondent to maintain landscaping.”

Judicial Recommendation

While ruling against the Petitioner, the judge offered a forward-looking, non-binding recommendation:

“…given that Petitioner is required to keep his gate secured due to having a pool, it is reasonable, going forward, for Respondent to communicate the days and times that it will be performing the landscaping of Petitioner’s back yard so that Petitioner can provide access for that service while maintaining safety precautions.”






Study Guide – 20F-H2020059-REL-RHG


Study Guide: Case No. 20F-H2020059-REL

Quiz: Short-Answer Questions

Instructions: Please answer the following questions in 2-3 complete sentences, using only information provided in the case documents.

1. Identify the Petitioner and Respondent in this case and describe the core issue of their dispute.

2. What specific provision of the governing documents did the Petitioner, Michael J. Stoltenberg, claim the Respondent violated?

3. According to the Petitioner’s testimony, what unique features did his property’s landscaping include, and what services did he believe the HOA was responsible for?

4. What was the primary reason the Respondent’s landscaping contractor, Mowtown Landscape, was unable to perform maintenance in the Petitioner’s backyard?

5. What was the testimony of Diana Crites, the property manager, regarding the scope of standard landscaping services provided by the HOA?

6. On what grounds did the Administrative Law Judge deny the Petitioner’s initial petition in the decision dated August 17, 2020?

7. For what primary reasons did the Commissioner of the Department of Real Estate grant the Petitioner a rehearing?

8. In the rehearing, what external sources did the Administrative Law Judge consult to determine the definition of “landscaping”?

9. What is the legal standard of proof required in this case, and who bears the responsibility for meeting it?

10. What was the final order issued after the rehearing on February 12, 2021, and what reasonable suggestion did the judge offer for future interactions?

——————————————————————————–

Answer Key

1. The Petitioner was homeowner Michael J. Stoltenberg. The Respondent was the Rancho Del Oro Homeowners Association (HOA). The core dispute concerned the HOA’s alleged failure to maintain the landscaping on the Petitioner’s property as required by the community’s CC&Rs, specifically whether this obligation included maintaining the Petitioner’s private pool.

2. The Petitioner claimed the Respondent violated Section 5.1 of the Covenants, Conditions, and Restrictions (CC&Rs). This section outlines the Association’s duties, including the maintenance of landscaping on individual lots outside of structures. The Petitioner also initially alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842.

3. The Petitioner testified that his landscaping was unique, including xeriscape with geometric patterns, “water features” (a pool), and walking paths that needed staining. He contended that the HOA should be responsible for maintaining these features, including replenishing the rock in his front yard when it wore thin.

4. The landscaping contractor was unable to perform maintenance because the gate to the backyard was always locked. The Petitioner acknowledged he kept it locked for liability reasons due to the pool, and evidence showed that in March 2020, a woman at the residence explicitly told the landscapers she did not want anyone in the backyard.

5. Diana Crites testified that the HOA provides uniform services, not “concierge” services. This includes front yard maintenance and mowing and blowing of backyards, but not maintaining potted plants, driveways, property-dividing walls, or individual homeowners’ pools.

6. The judge denied the petition because the evidence, including the Petitioner’s own admission, established that he had refused to allow the Respondent access to his backyard since January 2020. The decision noted the Respondent had made multiple attempts to access the yard and had consistently maintained the front yard.

7. The rehearing was granted for reasons outlined in the Petitioner’s rehearing request. These included claims of irregularity in the proceedings, newly discovered evidence, errors in the admission of evidence, and that the original decision was not supported by evidence or was contrary to law. The Petitioner also cited ADA and privacy issues.

8. The Administrative Law Judge consulted various online dictionary definitions (Oxford English Dictionary, Dictionary.com, Merriam-Webster, Law Insider). She also analyzed the license classifications from the Arizona Registrar of Contractors, specifically the R-21 Hardscaping and Irrigation Systems license and the R-6 Swimming Pool Service and Repair license.

9. The legal standard is “preponderance of the evidence,” which means the proof must convince the trier of fact that a contention is more probably true than not. The Petitioner bears the burden of proof to establish that the Respondent violated the governing documents.

10. The final order dismissed the Petitioner’s petition again, finding he failed to prove the HOA was obligated to maintain his pool. However, the judge suggested that it would be reasonable for the Respondent to communicate the days and times of its landscaping services going forward so the Petitioner could provide access while maintaining safety precautions.

——————————————————————————–

Essay Questions

Instructions: The following questions are designed to test a deeper, more comprehensive understanding of the case. Formulate a detailed essay response for each prompt.

1. Analyze the concept of “burden of proof” as it applies to this case. Explain who held the burden, what they were required to prove, and why the Administrative Law Judge ultimately found that they failed to meet this burden in both the initial hearing and the rehearing.

2. Discuss the role of access in the dispute between Michael J. Stoltenberg and the Rancho Del Oro HOA. How did the issue of the locked gate impact the initial ruling, and how did the Petitioner attempt to reframe this issue in the rehearing?

3. The interpretation of the word “landscaping” was central to the rehearing. Detail the Petitioner’s interpretation versus the conclusion reached by the Administrative Law Judge. What evidence and legal reasoning did the Judge use to support her conclusion that pool maintenance is not included in landscaping?

4. Trace the procedural history of this case, from the initial petition filing on April 21, 2020, to the final order after the rehearing. Identify the key events, the specific reasons cited for the rehearing, and the legal basis for the final dismissal.

5. Based on the testimony of Diana Crites and Rian Baas, describe the standard landscaping services provided by the Rancho Del Oro HOA and its contractor. How does this standard practice contrast with the specific and unique services the Petitioner demanded for his property?

——————————————————————————–

Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An independent judge who presides over administrative hearings, makes findings of fact and conclusions of law, and issues decisions and orders. In this case, Sondra J. Vanella served as the ALJ.

A.R.S.

Abbreviation for Arizona Revised Statutes, which are the codified laws of the state of Arizona.

Burden of Proof

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

Covenants, Conditions, and Restrictions. These are the governing legal documents that set up the rules for a planned community or homeowners’ association.

Department

Refers to the Arizona Department of Real Estate (ADRE), the state agency with jurisdiction over HOA dispute resolution petitions.

Homeowners’ Association. An organization in a subdivision, planned community, or condominium that makes and enforces rules for the properties and its residents. The Respondent was the Rancho Del Oro HOA.

Petitioner

The party who files a petition initiating a legal action. In this case, homeowner Michael J. Stoltenberg.

Petition

A formal written request filed with a court or administrative body to initiate a legal proceeding. Mr. Stoltenberg filed a petition alleging the HOA violated its CC&Rs.

Preponderance of the Evidence

The standard of proof in most civil and administrative cases. It requires the party with the burden of proof to convince the fact-finder that their claim is more likely to be true than not true.

Registrar of Contractors

The Arizona state agency responsible for licensing and regulating contractors. The ALJ referenced its license classifications for landscaping (R-21) and swimming pools (R-6) to help define the scope of services.

Respondent

The party against whom a petition is filed. In this case, the Rancho Del Oro Homeowners Association.






Blog Post – 20F-H2020059-REL-RHG


Briefing on Stoltenberg v. Rancho Del Oro Homeowners Association

Executive Summary

This document synthesizes the findings and rulings from two administrative hearings concerning a dispute between homeowner Michael J. Stoltenberg (Petitioner) and the Rancho Del Oro Homeowners Association (Respondent). The Petitioner alleged the HOA violated its governing documents by failing to maintain landscaping at his property. The case was ultimately dismissed after an initial hearing and a subsequent rehearing.

The core of the dispute centered on two key issues: the scope of “landscaping” services required by the HOA’s Covenants, Conditions, and Restrictions (CC&Rs), and the Petitioner’s denial of access to his backyard. The Petitioner argued that the undefined term “landscaping” in the CC&Rs should be interpreted broadly to include maintenance of his private swimming pool, which he referred to as a “water feature.” Concurrently, he acknowledged keeping his backyard gate locked for liability reasons related to the pool, preventing the HOA’s contractor from performing any work.

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to meet his burden of proof. The judge concluded that the HOA had made repeated, documented attempts to perform its duties, but was actively prevented from doing so by the Petitioner. Critically, the judge ruled that a reasonable interpretation of “landscaping,” supported by dictionary definitions and the Arizona Registrar of Contractors’ distinct licensing classifications for landscaping and swimming pool services, does not include the maintenance of a private pool and its associated mechanical equipment.

I. Case Overview

Case Detail

Information

Case Number

20F-H2020059-REL and 20F-H2020059-REL-RHG (Rehearing)

Petitioner

Michael J. Stoltenberg (Homeowner at 11777 E. Calle Gaudi, Yuma, AZ)

Respondent

Rancho Del Oro Homeowners Association (HOA)

Office of Administrative Hearings, Arizona

Presiding Judge

Administrative Law Judge Sondra J. Vanella

Hearing Dates

August 3, 2020 (Initial Hearing) and February 2, 2021 (Rehearing)

Final Disposition

Petition Dismissed (February 12, 2021)

II. Petitioner’s Allegations and Arguments

The Petitioner filed a petition with the Arizona Department of Real Estate on or about April 21, 2020, alleging the HOA acted in “bad faith” and failed to perform its duties in 2020. The core of his case was built on the following claims:

• Violation of CC&Rs: The Petitioner alleged a violation of § 5.1 of the HOA’s CC&Rs, which mandates that the “Association shall maintain… landscaping on individual Lots outside of structures.” He also alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842, although this was not addressed at the hearing.

• Broad Interpretation of “Landscaping”: The Petitioner contended that since the CC&Rs do not define “landscaping,” the term should encompass all features on his lot. He specifically asserted that the HOA was responsible for maintaining:

◦ His swimming pool (referred to as a “water feature”), including the pump, filter, and chemicals.

◦ His unique xeriscape with geometric patterns.

◦ Walking paths that required staining.

◦ Replenishing decorative rock when it wears thin.

◦ The patio and all hardscape.

• Denial of Access: The Petitioner acknowledged that the gate to his backyard was “always locked for liability reasons” due to the pool. At the rehearing, he argued that the HOA failed to communicate the landscaping schedule, which would have afforded him an opportunity to unlock the gate.

• Rehearing Claims: In his request for a rehearing, the Petitioner cited several grounds, including an abuse of discretion by the judge, errors in evidence, and issues related to the Americans with Disabilities Act (ADA), claiming hearing loss put him at a “severe disadvantage.” At the rehearing itself, he also asserted that the Respondent was “falsely representing themselves as an HOA” and did not have an elected Board.

III. Respondent’s Defense and Evidence

The HOA, represented by Nicole Payne, Esq., argued that it had fulfilled its obligations and that any failure to maintain the Petitioner’s backyard was due to his own actions.

• Consistent Maintenance of Front Yard: The HOA established that its contractor, Mowtown Landscape, had continuously maintained the Petitioner’s front yard since their contract began in January 2020.

• Denied Access to Backyard: The central defense was that the HOA’s contractor was repeatedly and deliberately denied access to the backyard. This was supported by substantial evidence:

◦ Testimony of Rian Baas (Mowtown Landscape): Mr. Baas testified that his crews were at the community every Wednesday and Thursday. He stated they knocked on the Petitioner’s door and left notes or business cards four or five times between January and March 2020.

◦ Testimony of Diana Crites (Property Manager): Ms. Crites presented a text message from Mr. Baas dated March 24, 2020, which read:

◦ Documentary Evidence: A photograph of the locked gate was submitted, along with a letter from Mr. Baas stating, “There is a lock on the gate going to the back yard and we were trying to see if they [sic] people inside the house wanted us to maintenance the back yard. No one ever answered or came to the door.”

• Scope of HOA Services: Ms. Crites testified that the HOA provides uniform services (front yard maintenance, mowing and blowing of back yards, sprinkler system maintenance) and does not offer “concierge” services like maintaining potted plants or private pools. The community pool, she noted, is maintained by a different company entirely (Crystal Clear Pool Maintenance).

IV. Judicial Findings and Legal Rulings

Administrative Law Judge Sondra J. Vanella found in favor of the Respondent in both the initial decision and the rehearing, ultimately dismissing the petition.

Initial Decision (August 17, 2020)

The initial petition was denied because the Petitioner failed to meet the burden of proof. The judge’s reasoning was:

1. Denial of Access: The Petitioner’s own admission, coupled with “credible, probative, and substantial evidence,” established that he had refused to allow the HOA access to his backyard since January 2020.

2. HOA Attempts: The evidence demonstrated that the HOA had attempted to access the yard on multiple occasions and was “specifically instructed in March 2020, that Respondent was not permitted to access Petitioner’s back yard.”

3. Scope of CC&Rs: The judge concluded that while § 5.1(a) of the CC&Rs requires the HOA to maintain yards, “nothing therein requires Respondent to maintain an individual member’s pool.”

Rehearing Decision (February 12, 2021)

After the Commissioner of the Department of Real Estate granted a rehearing, Judge Vanella again dismissed the petition, providing a more detailed legal analysis of the term “landscaping.”

1. Burden of Proof: The judge reiterated that the Petitioner bore the burden to establish that the HOA was legally obligated to maintain his pool, but “failed to establish by a preponderance of the evidence that Respondent must do so.”

2. Definition of “Landscaping”: The judge found that the definitions of “landscaping” from various sources, including dictionaries, “cannot reasonably be read to include a swimming pool and the associated mechanical equipment.”

3. State Licensing as Key Differentiator: The most definitive part of the ruling relied on the Arizona Registrar of Contractors’ licensing classifications, which treat landscaping and pool maintenance as two separate and distinct services.

License Classification

Description & Relevance

R-21 Hardscaping and Irrigation Systems (Formerly Landscaping and Irrigation Systems)

Allows for installation and repair of non-loadbearing concrete, patios, decorative walls, irrigation systems, and water features not attached to swimming pools. The classification specifically precludes the licensee from contracting for work on “swimming pools, pool deck coatings.”

R-6 Swimming Pool Service and Repair

A separate license required “to service and perform minor repair of residential pools and accessories.”

The judge concluded: “The Registrar’s licensing scheme supports a conclusion that landscaping maintenance and pool maintenance are two separate and distinct services… the CC&Rs cannot reasonably be interpreted to include pool maintenance when it required Respondent to maintain landscaping.”

Judicial Recommendation

While ruling against the Petitioner, the judge offered a forward-looking, non-binding recommendation:

“…given that Petitioner is required to keep his gate secured due to having a pool, it is reasonable, going forward, for Respondent to communicate the days and times that it will be performing the landscaping of Petitioner’s back yard so that Petitioner can provide access for that service while maintaining safety precautions.”


Case Participants

Petitioner Side

  • Michael J. Stoltenberg (petitioner)

Respondent Side

  • Nicole Payne (HOA attorney)
  • Diana Crites (property manager/witness)
    Crites and Associates
    Owner of Respondent's property management company; licensed broker
  • Rian Baas (witness/contractor owner)
    Mowtown Landscape
    Owner of landscaping company contracted by Respondent
  • Lydia A. Peirce Linsmeier (HOA attorney)
    CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
  • Luis (landscaping staff)
    Staff member mentioned in text regarding access attempts
  • Jill (staff/employee)
    Staff member mentioned printing paper for Luis regarding access attempts

Neutral Parties

  • Sondra J. Vanella (ALJ)
    OAH
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate

MICHAEL J. STOLTENBERG v. RANCHO DEL ORO HOMEOWNERS ASSOCIATION

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

Case Summary

Case ID 20F-H2020059-REL-RHG
Agency ADRE
Tribunal OAH
Decision Date 2021-02-12
Administrative Law Judge Sondra J. Vanella
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Michael J. Stoltenberg Counsel —
Respondent Rancho Del Oro Homeowners Association Counsel Nicole Payne

Alleged Violations

CC&Rs § 5.1; A.R.S. § 10-3842

Outcome Summary

The Administrative Law Judge dismissed the petition because the Petitioner failed to meet the burden of proof to show that the HOA violated the governing documents, primarily because the Petitioner refused access to his back yard, and the CC&Rs were not interpreted to include maintenance of an individual homeowner’s swimming pool.

Why this result: Petitioner refused to allow the HOA access to his back yard to perform landscape services, and failed to establish that pool maintenance was included in the HOA’s landscaping responsibility under the CC&Rs.

Key Issues & Findings

Failure to maintain landscaping and acting in bad faith

Petitioner alleged the HOA violated CC&Rs § 5.1 and A.R.S. § 10-3842 by failing to maintain landscaping in 2020. The dispute centered on whether landscaping duties included Petitioner's private pool/hardscape and Petitioner's refusal to grant access to his locked backyard for maintenance services.

Orders: Petition dismissed. Respondent was required to communicate the days and times for performing back yard landscaping so Petitioner could provide access while maintaining safety precautions.

Filing fee: $0.00

Disposition: respondent_win

Cited:

  • CC&Rs § 5.1
  • A.R.S. § 10-3842

Analytics Highlights

Topics: Landscaping, Pool Maintenance, Access Denial, CC&R Enforcement, A.R.S. § 10-3842
Additional Citations:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 33-1803
  • A.R.S. § 41-1092.07(G)(2)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • A.R.S. § 32-2199.02(B)
  • CC&Rs § 5.1
  • A.R.S. § 10-3842

Video Overview

Audio Overview

Decision Documents

20F-H2020059-REL-RHG Decision – 855028.pdf

Uploaded 2025-10-09T03:35:25 (139.1 KB)

20F-H2020059-REL-RHG Decision – ../20F-H2020059-REL/815480.pdf

Uploaded 2026-01-20T13:57:27 (124.1 KB)





Briefing Doc – 20F-H2020059-REL-RHG


Briefing on Stoltenberg v. Rancho Del Oro Homeowners Association

Executive Summary

This document synthesizes the findings and rulings from two administrative hearings concerning a dispute between homeowner Michael J. Stoltenberg (Petitioner) and the Rancho Del Oro Homeowners Association (Respondent). The Petitioner alleged the HOA violated its governing documents by failing to maintain landscaping at his property. The case was ultimately dismissed after an initial hearing and a subsequent rehearing.

The core of the dispute centered on two key issues: the scope of “landscaping” services required by the HOA’s Covenants, Conditions, and Restrictions (CC&Rs), and the Petitioner’s denial of access to his backyard. The Petitioner argued that the undefined term “landscaping” in the CC&Rs should be interpreted broadly to include maintenance of his private swimming pool, which he referred to as a “water feature.” Concurrently, he acknowledged keeping his backyard gate locked for liability reasons related to the pool, preventing the HOA’s contractor from performing any work.

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to meet his burden of proof. The judge concluded that the HOA had made repeated, documented attempts to perform its duties, but was actively prevented from doing so by the Petitioner. Critically, the judge ruled that a reasonable interpretation of “landscaping,” supported by dictionary definitions and the Arizona Registrar of Contractors’ distinct licensing classifications for landscaping and swimming pool services, does not include the maintenance of a private pool and its associated mechanical equipment.

I. Case Overview

Case Detail

Information

Case Number

20F-H2020059-REL and 20F-H2020059-REL-RHG (Rehearing)

Petitioner

Michael J. Stoltenberg (Homeowner at 11777 E. Calle Gaudi, Yuma, AZ)

Respondent

Rancho Del Oro Homeowners Association (HOA)

Office of Administrative Hearings, Arizona

Presiding Judge

Administrative Law Judge Sondra J. Vanella

Hearing Dates

August 3, 2020 (Initial Hearing) and February 2, 2021 (Rehearing)

Final Disposition

Petition Dismissed (February 12, 2021)

II. Petitioner’s Allegations and Arguments

The Petitioner filed a petition with the Arizona Department of Real Estate on or about April 21, 2020, alleging the HOA acted in “bad faith” and failed to perform its duties in 2020. The core of his case was built on the following claims:

• Violation of CC&Rs: The Petitioner alleged a violation of § 5.1 of the HOA’s CC&Rs, which mandates that the “Association shall maintain… landscaping on individual Lots outside of structures.” He also alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842, although this was not addressed at the hearing.

• Broad Interpretation of “Landscaping”: The Petitioner contended that since the CC&Rs do not define “landscaping,” the term should encompass all features on his lot. He specifically asserted that the HOA was responsible for maintaining:

◦ His swimming pool (referred to as a “water feature”), including the pump, filter, and chemicals.

◦ His unique xeriscape with geometric patterns.

◦ Walking paths that required staining.

◦ Replenishing decorative rock when it wears thin.

◦ The patio and all hardscape.

• Denial of Access: The Petitioner acknowledged that the gate to his backyard was “always locked for liability reasons” due to the pool. At the rehearing, he argued that the HOA failed to communicate the landscaping schedule, which would have afforded him an opportunity to unlock the gate.

• Rehearing Claims: In his request for a rehearing, the Petitioner cited several grounds, including an abuse of discretion by the judge, errors in evidence, and issues related to the Americans with Disabilities Act (ADA), claiming hearing loss put him at a “severe disadvantage.” At the rehearing itself, he also asserted that the Respondent was “falsely representing themselves as an HOA” and did not have an elected Board.

III. Respondent’s Defense and Evidence

The HOA, represented by Nicole Payne, Esq., argued that it had fulfilled its obligations and that any failure to maintain the Petitioner’s backyard was due to his own actions.

• Consistent Maintenance of Front Yard: The HOA established that its contractor, Mowtown Landscape, had continuously maintained the Petitioner’s front yard since their contract began in January 2020.

• Denied Access to Backyard: The central defense was that the HOA’s contractor was repeatedly and deliberately denied access to the backyard. This was supported by substantial evidence:

◦ Testimony of Rian Baas (Mowtown Landscape): Mr. Baas testified that his crews were at the community every Wednesday and Thursday. He stated they knocked on the Petitioner’s door and left notes or business cards four or five times between January and March 2020.

◦ Testimony of Diana Crites (Property Manager): Ms. Crites presented a text message from Mr. Baas dated March 24, 2020, which read:

◦ Documentary Evidence: A photograph of the locked gate was submitted, along with a letter from Mr. Baas stating, “There is a lock on the gate going to the back yard and we were trying to see if they [sic] people inside the house wanted us to maintenance the back yard. No one ever answered or came to the door.”

• Scope of HOA Services: Ms. Crites testified that the HOA provides uniform services (front yard maintenance, mowing and blowing of back yards, sprinkler system maintenance) and does not offer “concierge” services like maintaining potted plants or private pools. The community pool, she noted, is maintained by a different company entirely (Crystal Clear Pool Maintenance).

IV. Judicial Findings and Legal Rulings

Administrative Law Judge Sondra J. Vanella found in favor of the Respondent in both the initial decision and the rehearing, ultimately dismissing the petition.

Initial Decision (August 17, 2020)

The initial petition was denied because the Petitioner failed to meet the burden of proof. The judge’s reasoning was:

1. Denial of Access: The Petitioner’s own admission, coupled with “credible, probative, and substantial evidence,” established that he had refused to allow the HOA access to his backyard since January 2020.

2. HOA Attempts: The evidence demonstrated that the HOA had attempted to access the yard on multiple occasions and was “specifically instructed in March 2020, that Respondent was not permitted to access Petitioner’s back yard.”

3. Scope of CC&Rs: The judge concluded that while § 5.1(a) of the CC&Rs requires the HOA to maintain yards, “nothing therein requires Respondent to maintain an individual member’s pool.”

Rehearing Decision (February 12, 2021)

After the Commissioner of the Department of Real Estate granted a rehearing, Judge Vanella again dismissed the petition, providing a more detailed legal analysis of the term “landscaping.”

1. Burden of Proof: The judge reiterated that the Petitioner bore the burden to establish that the HOA was legally obligated to maintain his pool, but “failed to establish by a preponderance of the evidence that Respondent must do so.”

2. Definition of “Landscaping”: The judge found that the definitions of “landscaping” from various sources, including dictionaries, “cannot reasonably be read to include a swimming pool and the associated mechanical equipment.”

3. State Licensing as Key Differentiator: The most definitive part of the ruling relied on the Arizona Registrar of Contractors’ licensing classifications, which treat landscaping and pool maintenance as two separate and distinct services.

License Classification

Description & Relevance

R-21 Hardscaping and Irrigation Systems (Formerly Landscaping and Irrigation Systems)

Allows for installation and repair of non-loadbearing concrete, patios, decorative walls, irrigation systems, and water features not attached to swimming pools. The classification specifically precludes the licensee from contracting for work on “swimming pools, pool deck coatings.”

R-6 Swimming Pool Service and Repair

A separate license required “to service and perform minor repair of residential pools and accessories.”

The judge concluded: “The Registrar’s licensing scheme supports a conclusion that landscaping maintenance and pool maintenance are two separate and distinct services… the CC&Rs cannot reasonably be interpreted to include pool maintenance when it required Respondent to maintain landscaping.”

Judicial Recommendation

While ruling against the Petitioner, the judge offered a forward-looking, non-binding recommendation:

“…given that Petitioner is required to keep his gate secured due to having a pool, it is reasonable, going forward, for Respondent to communicate the days and times that it will be performing the landscaping of Petitioner’s back yard so that Petitioner can provide access for that service while maintaining safety precautions.”






Study Guide – 20F-H2020059-REL-RHG


Study Guide: Case No. 20F-H2020059-REL

Quiz: Short-Answer Questions

Instructions: Please answer the following questions in 2-3 complete sentences, using only information provided in the case documents.

1. Identify the Petitioner and Respondent in this case and describe the core issue of their dispute.

2. What specific provision of the governing documents did the Petitioner, Michael J. Stoltenberg, claim the Respondent violated?

3. According to the Petitioner’s testimony, what unique features did his property’s landscaping include, and what services did he believe the HOA was responsible for?

4. What was the primary reason the Respondent’s landscaping contractor, Mowtown Landscape, was unable to perform maintenance in the Petitioner’s backyard?

5. What was the testimony of Diana Crites, the property manager, regarding the scope of standard landscaping services provided by the HOA?

6. On what grounds did the Administrative Law Judge deny the Petitioner’s initial petition in the decision dated August 17, 2020?

7. For what primary reasons did the Commissioner of the Department of Real Estate grant the Petitioner a rehearing?

8. In the rehearing, what external sources did the Administrative Law Judge consult to determine the definition of “landscaping”?

9. What is the legal standard of proof required in this case, and who bears the responsibility for meeting it?

10. What was the final order issued after the rehearing on February 12, 2021, and what reasonable suggestion did the judge offer for future interactions?

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Answer Key

1. The Petitioner was homeowner Michael J. Stoltenberg. The Respondent was the Rancho Del Oro Homeowners Association (HOA). The core dispute concerned the HOA’s alleged failure to maintain the landscaping on the Petitioner’s property as required by the community’s CC&Rs, specifically whether this obligation included maintaining the Petitioner’s private pool.

2. The Petitioner claimed the Respondent violated Section 5.1 of the Covenants, Conditions, and Restrictions (CC&Rs). This section outlines the Association’s duties, including the maintenance of landscaping on individual lots outside of structures. The Petitioner also initially alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842.

3. The Petitioner testified that his landscaping was unique, including xeriscape with geometric patterns, “water features” (a pool), and walking paths that needed staining. He contended that the HOA should be responsible for maintaining these features, including replenishing the rock in his front yard when it wore thin.

4. The landscaping contractor was unable to perform maintenance because the gate to the backyard was always locked. The Petitioner acknowledged he kept it locked for liability reasons due to the pool, and evidence showed that in March 2020, a woman at the residence explicitly told the landscapers she did not want anyone in the backyard.

5. Diana Crites testified that the HOA provides uniform services, not “concierge” services. This includes front yard maintenance and mowing and blowing of backyards, but not maintaining potted plants, driveways, property-dividing walls, or individual homeowners’ pools.

6. The judge denied the petition because the evidence, including the Petitioner’s own admission, established that he had refused to allow the Respondent access to his backyard since January 2020. The decision noted the Respondent had made multiple attempts to access the yard and had consistently maintained the front yard.

7. The rehearing was granted for reasons outlined in the Petitioner’s rehearing request. These included claims of irregularity in the proceedings, newly discovered evidence, errors in the admission of evidence, and that the original decision was not supported by evidence or was contrary to law. The Petitioner also cited ADA and privacy issues.

8. The Administrative Law Judge consulted various online dictionary definitions (Oxford English Dictionary, Dictionary.com, Merriam-Webster, Law Insider). She also analyzed the license classifications from the Arizona Registrar of Contractors, specifically the R-21 Hardscaping and Irrigation Systems license and the R-6 Swimming Pool Service and Repair license.

9. The legal standard is “preponderance of the evidence,” which means the proof must convince the trier of fact that a contention is more probably true than not. The Petitioner bears the burden of proof to establish that the Respondent violated the governing documents.

10. The final order dismissed the Petitioner’s petition again, finding he failed to prove the HOA was obligated to maintain his pool. However, the judge suggested that it would be reasonable for the Respondent to communicate the days and times of its landscaping services going forward so the Petitioner could provide access while maintaining safety precautions.

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Essay Questions

Instructions: The following questions are designed to test a deeper, more comprehensive understanding of the case. Formulate a detailed essay response for each prompt.

1. Analyze the concept of “burden of proof” as it applies to this case. Explain who held the burden, what they were required to prove, and why the Administrative Law Judge ultimately found that they failed to meet this burden in both the initial hearing and the rehearing.

2. Discuss the role of access in the dispute between Michael J. Stoltenberg and the Rancho Del Oro HOA. How did the issue of the locked gate impact the initial ruling, and how did the Petitioner attempt to reframe this issue in the rehearing?

3. The interpretation of the word “landscaping” was central to the rehearing. Detail the Petitioner’s interpretation versus the conclusion reached by the Administrative Law Judge. What evidence and legal reasoning did the Judge use to support her conclusion that pool maintenance is not included in landscaping?

4. Trace the procedural history of this case, from the initial petition filing on April 21, 2020, to the final order after the rehearing. Identify the key events, the specific reasons cited for the rehearing, and the legal basis for the final dismissal.

5. Based on the testimony of Diana Crites and Rian Baas, describe the standard landscaping services provided by the Rancho Del Oro HOA and its contractor. How does this standard practice contrast with the specific and unique services the Petitioner demanded for his property?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An independent judge who presides over administrative hearings, makes findings of fact and conclusions of law, and issues decisions and orders. In this case, Sondra J. Vanella served as the ALJ.

A.R.S.

Abbreviation for Arizona Revised Statutes, which are the codified laws of the state of Arizona.

Burden of Proof

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

Covenants, Conditions, and Restrictions. These are the governing legal documents that set up the rules for a planned community or homeowners’ association.

Department

Refers to the Arizona Department of Real Estate (ADRE), the state agency with jurisdiction over HOA dispute resolution petitions.

Homeowners’ Association. An organization in a subdivision, planned community, or condominium that makes and enforces rules for the properties and its residents. The Respondent was the Rancho Del Oro HOA.

Petitioner

The party who files a petition initiating a legal action. In this case, homeowner Michael J. Stoltenberg.

Petition

A formal written request filed with a court or administrative body to initiate a legal proceeding. Mr. Stoltenberg filed a petition alleging the HOA violated its CC&Rs.

Preponderance of the Evidence

The standard of proof in most civil and administrative cases. It requires the party with the burden of proof to convince the fact-finder that their claim is more likely to be true than not true.

Registrar of Contractors

The Arizona state agency responsible for licensing and regulating contractors. The ALJ referenced its license classifications for landscaping (R-21) and swimming pools (R-6) to help define the scope of services.

Respondent

The party against whom a petition is filed. In this case, the Rancho Del Oro Homeowners Association.






Blog Post – 20F-H2020059-REL-RHG


Briefing on Stoltenberg v. Rancho Del Oro Homeowners Association

Executive Summary

This document synthesizes the findings and rulings from two administrative hearings concerning a dispute between homeowner Michael J. Stoltenberg (Petitioner) and the Rancho Del Oro Homeowners Association (Respondent). The Petitioner alleged the HOA violated its governing documents by failing to maintain landscaping at his property. The case was ultimately dismissed after an initial hearing and a subsequent rehearing.

The core of the dispute centered on two key issues: the scope of “landscaping” services required by the HOA’s Covenants, Conditions, and Restrictions (CC&Rs), and the Petitioner’s denial of access to his backyard. The Petitioner argued that the undefined term “landscaping” in the CC&Rs should be interpreted broadly to include maintenance of his private swimming pool, which he referred to as a “water feature.” Concurrently, he acknowledged keeping his backyard gate locked for liability reasons related to the pool, preventing the HOA’s contractor from performing any work.

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to meet his burden of proof. The judge concluded that the HOA had made repeated, documented attempts to perform its duties, but was actively prevented from doing so by the Petitioner. Critically, the judge ruled that a reasonable interpretation of “landscaping,” supported by dictionary definitions and the Arizona Registrar of Contractors’ distinct licensing classifications for landscaping and swimming pool services, does not include the maintenance of a private pool and its associated mechanical equipment.

I. Case Overview

Case Detail

Information

Case Number

20F-H2020059-REL and 20F-H2020059-REL-RHG (Rehearing)

Petitioner

Michael J. Stoltenberg (Homeowner at 11777 E. Calle Gaudi, Yuma, AZ)

Respondent

Rancho Del Oro Homeowners Association (HOA)

Office of Administrative Hearings, Arizona

Presiding Judge

Administrative Law Judge Sondra J. Vanella

Hearing Dates

August 3, 2020 (Initial Hearing) and February 2, 2021 (Rehearing)

Final Disposition

Petition Dismissed (February 12, 2021)

II. Petitioner’s Allegations and Arguments

The Petitioner filed a petition with the Arizona Department of Real Estate on or about April 21, 2020, alleging the HOA acted in “bad faith” and failed to perform its duties in 2020. The core of his case was built on the following claims:

• Violation of CC&Rs: The Petitioner alleged a violation of § 5.1 of the HOA’s CC&Rs, which mandates that the “Association shall maintain… landscaping on individual Lots outside of structures.” He also alleged a violation of Arizona Revised Statutes (A.R.S.) § 10-3842, although this was not addressed at the hearing.

• Broad Interpretation of “Landscaping”: The Petitioner contended that since the CC&Rs do not define “landscaping,” the term should encompass all features on his lot. He specifically asserted that the HOA was responsible for maintaining:

◦ His swimming pool (referred to as a “water feature”), including the pump, filter, and chemicals.

◦ His unique xeriscape with geometric patterns.

◦ Walking paths that required staining.

◦ Replenishing decorative rock when it wears thin.

◦ The patio and all hardscape.

• Denial of Access: The Petitioner acknowledged that the gate to his backyard was “always locked for liability reasons” due to the pool. At the rehearing, he argued that the HOA failed to communicate the landscaping schedule, which would have afforded him an opportunity to unlock the gate.

• Rehearing Claims: In his request for a rehearing, the Petitioner cited several grounds, including an abuse of discretion by the judge, errors in evidence, and issues related to the Americans with Disabilities Act (ADA), claiming hearing loss put him at a “severe disadvantage.” At the rehearing itself, he also asserted that the Respondent was “falsely representing themselves as an HOA” and did not have an elected Board.

III. Respondent’s Defense and Evidence

The HOA, represented by Nicole Payne, Esq., argued that it had fulfilled its obligations and that any failure to maintain the Petitioner’s backyard was due to his own actions.

• Consistent Maintenance of Front Yard: The HOA established that its contractor, Mowtown Landscape, had continuously maintained the Petitioner’s front yard since their contract began in January 2020.

• Denied Access to Backyard: The central defense was that the HOA’s contractor was repeatedly and deliberately denied access to the backyard. This was supported by substantial evidence:

◦ Testimony of Rian Baas (Mowtown Landscape): Mr. Baas testified that his crews were at the community every Wednesday and Thursday. He stated they knocked on the Petitioner’s door and left notes or business cards four or five times between January and March 2020.

◦ Testimony of Diana Crites (Property Manager): Ms. Crites presented a text message from Mr. Baas dated March 24, 2020, which read:

◦ Documentary Evidence: A photograph of the locked gate was submitted, along with a letter from Mr. Baas stating, “There is a lock on the gate going to the back yard and we were trying to see if they [sic] people inside the house wanted us to maintenance the back yard. No one ever answered or came to the door.”

• Scope of HOA Services: Ms. Crites testified that the HOA provides uniform services (front yard maintenance, mowing and blowing of back yards, sprinkler system maintenance) and does not offer “concierge” services like maintaining potted plants or private pools. The community pool, she noted, is maintained by a different company entirely (Crystal Clear Pool Maintenance).

IV. Judicial Findings and Legal Rulings

Administrative Law Judge Sondra J. Vanella found in favor of the Respondent in both the initial decision and the rehearing, ultimately dismissing the petition.

Initial Decision (August 17, 2020)

The initial petition was denied because the Petitioner failed to meet the burden of proof. The judge’s reasoning was:

1. Denial of Access: The Petitioner’s own admission, coupled with “credible, probative, and substantial evidence,” established that he had refused to allow the HOA access to his backyard since January 2020.

2. HOA Attempts: The evidence demonstrated that the HOA had attempted to access the yard on multiple occasions and was “specifically instructed in March 2020, that Respondent was not permitted to access Petitioner’s back yard.”

3. Scope of CC&Rs: The judge concluded that while § 5.1(a) of the CC&Rs requires the HOA to maintain yards, “nothing therein requires Respondent to maintain an individual member’s pool.”

Rehearing Decision (February 12, 2021)

After the Commissioner of the Department of Real Estate granted a rehearing, Judge Vanella again dismissed the petition, providing a more detailed legal analysis of the term “landscaping.”

1. Burden of Proof: The judge reiterated that the Petitioner bore the burden to establish that the HOA was legally obligated to maintain his pool, but “failed to establish by a preponderance of the evidence that Respondent must do so.”

2. Definition of “Landscaping”: The judge found that the definitions of “landscaping” from various sources, including dictionaries, “cannot reasonably be read to include a swimming pool and the associated mechanical equipment.”

3. State Licensing as Key Differentiator: The most definitive part of the ruling relied on the Arizona Registrar of Contractors’ licensing classifications, which treat landscaping and pool maintenance as two separate and distinct services.

License Classification

Description & Relevance

R-21 Hardscaping and Irrigation Systems (Formerly Landscaping and Irrigation Systems)

Allows for installation and repair of non-loadbearing concrete, patios, decorative walls, irrigation systems, and water features not attached to swimming pools. The classification specifically precludes the licensee from contracting for work on “swimming pools, pool deck coatings.”

R-6 Swimming Pool Service and Repair

A separate license required “to service and perform minor repair of residential pools and accessories.”

The judge concluded: “The Registrar’s licensing scheme supports a conclusion that landscaping maintenance and pool maintenance are two separate and distinct services… the CC&Rs cannot reasonably be interpreted to include pool maintenance when it required Respondent to maintain landscaping.”

Judicial Recommendation

While ruling against the Petitioner, the judge offered a forward-looking, non-binding recommendation:

“…given that Petitioner is required to keep his gate secured due to having a pool, it is reasonable, going forward, for Respondent to communicate the days and times that it will be performing the landscaping of Petitioner’s back yard so that Petitioner can provide access for that service while maintaining safety precautions.”


Case Participants

Petitioner Side

  • Michael J. Stoltenberg (petitioner)

Respondent Side

  • Nicole Payne (HOA attorney)
  • Diana Crites (property manager/witness)
    Crites and Associates
    Owner of Respondent's property management company; licensed broker
  • Rian Baas (witness/contractor owner)
    Mowtown Landscape
    Owner of landscaping company contracted by Respondent
  • Lydia A. Peirce Linsmeier (HOA attorney)
    CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
  • Luis (landscaping staff)
    Staff member mentioned in text regarding access attempts
  • Jill (staff/employee)
    Staff member mentioned printing paper for Luis regarding access attempts

Neutral Parties

  • Sondra J. Vanella (ALJ)
    OAH
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate

Erik R. Pierce v. Sierra Morado Community Association

Posted on by

Case Summary

Case ID 20F-H2020053-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-02-10
Administrative Law Judge Adam D. Stone
Outcome none
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Erik R. Pierce Counsel James C. Frisch
Respondent Sierra Morado Community Association Counsel Nicholas C.S. Nogami and Heather M. Hampstead

Alleged Violations

Article 11, Section 11.1

Outcome Summary

The Administrative Law Judge denied the petition, concluding that the Respondent HOA did not violate CC&R Section 11.1 because that section grants the Board discretion, rather than a mandatory obligation, in the timing of enforcement actions.

Why this result: The Petitioner failed to meet the burden of proof to establish that the Respondent violated CC&R Section 11.1, as the ALJ found the Board's decision to temporarily delay enforcement pending litigation and settlement discussions fell within the discretion granted by the CC&R.

Key Issues & Findings

Failure of HOA to Enforce Architectural Approval Conditions (Hot Tub Screening)

Petitioner alleged that the HOA failed to enforce the mandatory installation of a pergola and screening around a neighbor's hot tub, a condition imposed by the Architectural Review Committee when retroactively approving the installation.

Orders: Petitioner's petition is denied.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199(B)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • CC&R Article 11, Section 11.1
  • CC&R Article 4, Section 4.27

Analytics Highlights

Topics: HOA Enforcement, CC&R Dispute, Architectural Control, Discretionary Enforcement
Additional Citations:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.07(G)(2)
  • A.R.S. § 41-1092.09
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • CC&R Article 4, Section 4.27
  • CC&R Article 11, Section 11.1
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
  • MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
  • BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999)

Video Overview

Audio Overview

Decision Documents

20F-H2020053-REL Decision – 850237.pdf

Uploaded 2026-01-23T17:32:29 (43.0 KB)

20F-H2020053-REL Decision – 850239.pdf

Uploaded 2026-01-23T17:32:31 (7.1 KB)

20F-H2020053-REL Decision – 853778.pdf

Uploaded 2026-01-23T17:32:32 (119.9 KB)





Briefing Doc – 20F-H2020053-REL


Administrative Hearing Briefing: Pierce v. Sierra Morado Community Association

Executive Summary

This briefing synthesizes the key findings and judicial decision in the administrative case of Erik R. Pierce versus the Sierra Morado Community Association (SMCA), Case No. 20F-H2020053-REL. The petition, filed by homeowner Erik R. Pierce, was ultimately denied by the Administrative Law Judge on February 10, 2021.

The core of the dispute was Pierce’s allegation that the SMCA failed to enforce its Covenants, Conditions, and Restrictions (CC&Rs) against his neighbors, the Kinstles, who installed a hot tub visible from Pierce’s property, creating a privacy violation. While the SMCA Board retroactively approved the hot tub, it did so with the explicit condition that a pergola and screening be installed to mitigate the visibility issue. The Kinstles subsequently failed to install the required screening.

The judge concluded that the SMCA’s conditional approval resolved the initial violation claim under CC&R Section 4.27. The central issue then became whether the SMCA’s subsequent failure to compel the installation of the screening constituted a violation of its enforcement duty under CC&R Section 11.1. The judge ruled that it did not, finding that the CC&Rs grant the Association a discretionary right to enforce its rules, not an absolute obligation. The judge found persuasive the SMCA’s testimony that it delayed enforcement actions due to the ongoing litigation and in an attempt to foster a settlement between the neighbors. This exercise of discretion was deemed permissible under the Association’s governing documents.

1. Case Overview

Parties and Legal Representation

Entity

Legal Counsel

Petitioner

Erik R. Pierce

James C. Frisch, Esq. & Michael Resare, Esq. (King & Frisch, P.C.)

Respondent

Sierra Morado Community Association (SMCA)

Heather M. Hampstead, Esq. & Nicholas C.S. Nogami, Esq. (Carpenter, Hazlewood, Delgado & Bolen, LLP)

Key Case Details

• Case Number: 20F-H2020053-REL

• Presiding Judge: Adam D. Stone, Administrative Law Judge

• Hearing Date: January 25, 2021 (conducted via Google Meet)

• Decision Date: February 10, 2021

• Jurisdiction: The Arizona Department of Real Estate (ADRE) is statutorily authorized to hear petitions from homeowners’ association members. This case was referred by the ADRE to the Office of Administrative Hearings for an evidentiary hearing.

2. Core Dispute and Allegations

Petitioner’s Complaint

On March 23, 2020, Erik R. Pierce filed a complaint with the ADRE alleging that the SMCA was in violation of its own CC&Rs, specifically Sections 4.27 (Swimming Pools and Spas) and 11.1 (Enforcement).

The dispute originated with the installation of a hot tub by Pierce’s neighbors, the Kinstles. Pierce testified that the hot tub and its occupants were visible from inside his house, and that occupants of the hot tub could look directly into his home, violating his right to privacy.

Timeline of Key Events

• September 4, 2019: Pierce submits his initial complaint to the SMCA, noting the hot tub’s visibility and asserting that the Kinstles had failed to obtain prior approval from the Architectural Review Committee (ARC).

• Post-September 2019: The SMCA informs the Kinstles that they installed the hot tub without approval and directs them to submit plans for the proper approval process.

• February 10, 2020: After several rejections, the SMCA Board approves the Kinstles’ hot tub installation on the condition that a pergola and screening are installed.

• March 3, 2020: Pierce receives a letter from the property management company, AAM, LLC, stating that the installation was approved with the screening requirement and that the complaint was closed.

• January 25, 2021: At the time of the hearing, the Kinstles had still not installed the required pergola and screening.

3. Analysis of Key Testimonies

The decision was informed by testimony from four witnesses presented by the Petitioner.

• Erik R. Pierce (Petitioner): Outlined the timeline of the dispute, the visibility of the neighbors’ hot tub, the resulting privacy violation, and the SMCA Board’s failure to enforce its own conditional approval requiring a pergola and screening.

• Bill Oliver (Former SMCA President, Fall 2019 – April 2020): Confirmed that the Board approved the hot tub retroactively with the stipulation for a pergola and screening. He stated the Board had a “rigorous process of enforcement” but could not recall if a specific violation letter was sent to the Kinstles after the conditional approval was granted.

• Jodie Cervantes (Former Community Manager, 2019 – June 2020): Testified that she believed the CC&Rs were enforced and the matter was closed. She suggested the Kinstles had a six-month period to comply with the screening requirement, which she believed was in the Design Guidelines, but could not point to the specific language.

• Martin Douglas (Current SMCA President, from April 2020): Stated he had been to the Pierce residence for another matter and the hot tub was not visible to him. He attributed the lack of enforcement action to the “ongoing litigation and multiple settlement offers which were being exchanged.” He testified that upon resolution of the case, the Board “will follow through with enforcement actions should the Kinstle’s fail to comply.”

4. Judicial Reasoning and Decision

The Administrative Law Judge’s decision centered on the interpretation of the SMCA’s CC&Rs and the discretionary power of its Board.

Governing CC&R Provisions

The ruling rested on the specific language of two sections of the SMCA CC&Rs:

• Section 4.27 (Swimming Pools and Spas): This section permits the installation of a hot tub only if it is “properly screened… if neither it nor its occupants are Visible from Neighboring Property, and with the prior written approval of the Architectural Review Committee.”

• Section 11.1 (Enforcement): This section states that “The Association or any Owner shall have the right to enforce the Project Documents… The failure of the Association or an Owner to take enforcement action with respect to a violation of the Project Documents shall not constitute or be deemed a waiver of the right of the Association or any Owner to enforce the Project Documents in the future.”

Administrative Law Judge’s Conclusions

1. Resolution of the Section 4.27 Claim: The judge determined that the initial issue regarding the unapproved hot tub “was essentially resolved by the Board instructing the Kinstle’s erect a pergola and install screening.” By making its approval conditional on a privacy solution, the Board addressed the core requirement of the section.

2. The “Heart of the Matter” – Section 11.1 Enforcement: The judge identified the central question as whether the SMCA violated Section 11.1 by failing to enforce the screening requirement against the Kinstles.

3. Discretionary vs. Mandatory Enforcement: The judge concluded that the language of Section 11.1 grants the Board a “right to enforce, not an absolute obligation.”

4. Rationale for Delayed Enforcement: The judge found the testimony of the current SMCA President, Martin Douglas, to be “more persuasive.” Douglas’s explanation—that the Board delayed enforcement to “foster an agreement with the neighbors” amid ongoing litigation—was accepted as a valid exercise of the Board’s discretion.

5. Final Ruling: The judge stated, “Section 11.1 expressly granted the Board this discretion, and it should not be disturbed.” Consequently, the judge ruled that the Petitioner failed to prove by a preponderance of the evidence that the Respondent had violated CC&R Section 11.1.

Final Order

IT IS ORDERED that Petitioners’ petition is denied.

The order was issued on February 10, 2021, and is binding unless a rehearing is granted.






Study Guide – 20F-H2020053-REL


Study Guide: Pierce v. Sierra Morado Community Association (Case No. 20F-H2020053-REL)

This study guide provides a review of the administrative hearing concerning the dispute between Erik R. Pierce and the Sierra Morado Community Association. It includes a short-answer quiz, an answer key, suggested essay questions, and a comprehensive glossary of terms and entities involved in the case.

Short-Answer Quiz

Answer each of the following questions in two to three complete sentences, based on the provided source documents.

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

2. What was the initial reason for Mr. Pierce’s complaint against his neighbors, the Kinstles?

3. Which two sections of the Sierra Morado Community Association (SMCA) CC&Rs did Mr. Pierce allege were violated?

4. What action did the SMCA Board take after being informed that the Kinstles had installed a hot tub without prior approval?

5. What specific conditions did the SMCA Board require for the retroactive approval of the Kinstles’ hot tub installation?

6. According to former Board President Bill Oliver’s testimony, what was the Board’s common practice regarding architectural requests made after an installation?

7. What reason did Community Manager Jodie Cervantes give for her belief that no further enforcement action could be taken against the Kinstles?

8. According to current SMCA Board President Martin Douglas, why had the Board delayed enforcement actions against the Kinstles?

9. What was the Administrative Law Judge’s final decision regarding the alleged violation of CC&R Section 11.1?

10. How did the judge interpret the Board’s enforcement power as described in Section 11.1 of the CC&Rs?

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Answer Key

1. The primary parties were Erik R. Pierce, who was the Petitioner filing the complaint, and the Sierra Morado Community Association (SMCA), which was the Respondent. Mr. Pierce is a homeowner and member of the SMCA.

2. Mr. Pierce’s complaint originated because his neighbors, the Kinstles, installed a hot tub that was visible from his backyard. He testified that occupants in the hot tub were visible from inside his house, violating his privacy.

3. The Petitioner, Mr. Pierce, alleged that the Respondent, SMCA, was in violation of sections 4.27 and 11.1 of the SMCA CC&Rs. Section 4.27 pertains to the installation of spas, and Section 11.1 addresses the enforcement of project documents.

4. After Mr. Pierce filed his complaint, the SMCA informed the Kinstles that they had installed the hot tub without approval. The Board then directed the Kinstles to submit their plans and go through the proper architectural approval process.

5. The Kinstles’ hot tub was approved retroactively on February 10, 2020, on the condition that they install a pergola and screening. This was intended to address the visibility of the hot tub from Mr. Pierce’s property.

6. Bill Oliver, the SMCA President from fall 2019 to April 2020, testified that the Board would approve architectural requests retroactively. He confirmed that this is what occurred in the case of the Kinstles’ hot tub.

7. Jodie Cervantes, the Community Manager, testified that she believed the matter was closed because the Kinstles had six months to comply with the pergola and screening requirements. She believed this six-month deadline was outlined in the Design Guidelines, though she could not locate the specific language.

8. Martin Douglas, who became Board President in April 2020, testified that the Board delayed enforcement actions due to the ongoing litigation. He stated that multiple settlement offers were being exchanged in an effort to foster an agreement between the neighbors.

9. The Administrative Law Judge ordered that the Petitioner’s petition be denied. The judge concluded that Mr. Pierce did not establish by a preponderance of the evidence that the SMCA had violated CC&R Section 11.1.

10. The judge determined that Section 11.1 grants the Board a right to enforce the rules, not an absolute obligation to do so. This interpretation means the Board has the discretion to delay enforcement, which it did in this case to facilitate a potential settlement.

——————————————————————————–

Essay Questions

The following questions are designed for longer, essay-style responses. Use evidence and testimony from the case documents to construct a thorough analysis. No answers are provided.

1. Explain the legal standard of “preponderance of the evidence” as defined in the Administrative Law Judge’s decision. Analyze why the Petitioner, Erik R. Pierce, failed to meet this burden of proof concerning the violation of CC&R Section 11.1.

2. Trace the timeline of events from Mr. Pierce’s initial complaint on September 4, 2019, to the final decision on February 10, 2021. Discuss the key actions, delays, and decisions made by the SMCA Board during this period.

3. Compare and contrast the testimonies of Bill Oliver, Jodie Cervantes, and Martin Douglas. How do their different roles and timeframes with the SMCA shape their perspectives on the association’s enforcement process and the specific handling of the Kinstle case?

4. Analyze the Administrative Law Judge’s interpretation of CC&R Section 11.1. Discuss the distinction made between a “right to enforce” and an “absolute obligation,” and explain how this interpretation was central to the final ruling.

5. Based on the judge’s findings and the testimony of Martin Douglas, what are the likely next steps for the SMCA regarding the Kinstles’ non-compliance with the pergola and screening requirement? Evaluate the potential for future conflict or resolution between the parties involved.

——————————————————————————–

Glossary of Key Terms

Term / Entity

Definition

AAM, LLC

The property management company that employed Community Manager Jodie Cervantes and managed the Sierra Morado Community Association during the period of the dispute.

Administrative Law Judge (ALJ)

The official who presides over administrative hearings. In this case, the ALJ was Adam D. Stone of the Office of Administrative Hearings.

Architectural Committee (ARC)

The committee within the SMCA responsible for approving construction, installations, and alterations to properties, as referenced in CC&R Section 4.27.

Arizona Department of Real Estate (ADRE)

The state agency authorized by statute to receive and decide Petitions for Hearing from members of homeowners’ associations. Mr. Pierce filed his initial complaint with this department.

Burden of Proof

The obligation on a party in a legal case to prove its allegations. In this case, the Petitioner had the burden to establish his claim by a “preponderance of the evidence.”

Covenants, Conditions, and Restrictions. These are the governing documents or rules of a planned community. The dispute centered on alleged violations of Sections 4.27 (Swimming Pools and Spas) and 11.1 (Enforcement).

Hearing

The formal proceeding held on January 25, 2021, where the parties presented exhibits and witness testimony to the Administrative Law Judge.

Office of Administrative Hearings

An independent state agency that conducts evidentiary hearings for other state agencies, such as the Department of Real Estate.

Petitioner

The party who files a petition or complaint to initiate a legal proceeding. In this case, the Petitioner was Erik R. Pierce.

Preponderance of the Evidence

The evidentiary standard required for the Petitioner to win the case. It is defined as proof that convinces the trier of fact that a contention is “more probably true than not.”

Respondent

The party against whom a petition or complaint is filed. In this case, the Respondent was the Sierra Morado Community Association (SMCA).

Retroactive Approval

The act of approving an architectural installation (such as a hot tub) after it has already been completed, which the SMCA Board did in this case.

Sierra Morado Community Association (SMCA)

The homeowners’ association in Tucson, Arizona, of which Erik R. Pierce and the Kinstles are members.

Stipulation

An agreement between the parties in a legal proceeding. In this case, the parties stipulated to enter all submitted exhibits into the record.






Blog Post – 20F-H2020053-REL


Your HOA Can Ignore Its Own Rules? A Surprising Legal Case Every Homeowner Needs to Understand

Introduction: The Homeowner’s Dilemma

Most homeowners in a planned community operate under a simple assumption: if a neighbor violates a clear rule, you can file a complaint, and the Homeowners Association (HOA) is required to take action. It’s the fundamental promise of an HOA—consistent enforcement to protect property values and quality of life.

But what happens when the HOA agrees a violation has occurred, demands a fix, and then… does nothing to enforce it?

A real-world legal case, Erik R. Pierce versus the Sierra Morado Community Association, provides a surprising and cautionary answer. The final court decision reveals a critical loophole that may exist in your own HOA agreement. This article will break down the three most counter-intuitive takeaways from that case that every homeowner should understand.

Takeaway 1: “A Right to Enforce” Isn’t an “Obligation to Enforce”

The core of the dispute was straightforward. Homeowner Erik Pierce filed a complaint because his neighbors, the Kinstles, installed a hot tub that was visible from his property, a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs)—the legally binding rules that govern the community. The HOA’s Architectural Committee retroactively approved the hot tub, but only on the condition that the neighbors install a pergola and screening to shield it from view.

The neighbors never installed the required screening, yet the HOA took no further enforcement action. This inaction led Mr. Pierce to sue the HOA.

The judge’s decision hinged on a crucial interpretation of the HOA’s governing documents. The judge ruled in favor of the HOA because the documents gave the Board the right to enforce the rules, not an absolute obligation to do so. This distinction granted the HOA discretion to choose its strategy. The judge found the board’s reasoning for the delay persuasive: it was deliberately choosing negotiation over immediate punitive action to resolve the conflict. The board’s discretion wasn’t just a right to do nothing; it was a right to choose a different path to compliance.

The key phrase here is “shall have the right to enforce.” Had the documents stated the board “shall enforce,” the outcome would likely have been entirely different. This single phrase transforms enforcement from a mandate into a strategic option for the board.

The Administrative Law Judge’s decision highlights this critical point:

“…Section 11.1 only gives the Board a right to enforce, not an absolute obligation. While Petitioner is understandably upset that there has yet to be any follow through on enforcement of the screening requirements, this tribunal finds the testimony of Mr. Douglas more persuasive, namely that the Board has delayed in enforcing because it was trying to foster an agreement with the neighbors. Section 11.1 expressly granted the Board this discretion, and it should not be disturbed.”

This finding is shocking for most homeowners, who reasonably assume that the rules laid out in their CC&Rs are mandates for the board, not a menu of discretionary options.

Takeaway 2: Suing Your HOA Can Ironically Pause Enforcement

The board’s discretionary power was put on full display when Mr. Pierce filed his lawsuit, creating a legal Catch-22. The current SMCA Board President, Martin Douglas, testified that the board deliberately paused formal enforcement actions against the neighbors who had violated the architectural requirement.

The judge ultimately found that the board’s rationale for this pause was a valid exercise of its discretion. The decision to delay was framed not as inaction, but as a strategic choice “to foster an agreement with the neighbors” amidst the complexities of litigation.

This reveals a deep irony: by filing a petition to force the HOA’s hand, the homeowner inadvertently provided the context for the HOA to justify a delay. The judge accepted that the board’s attempt to find a negotiated solution instead of escalating fines and penalties during an active lawsuit was a reasonable use of its discretionary authority. This case demonstrates how legal action, intended to accelerate a resolution, can sometimes be used by an HOA board to justify a different, slower approach.

Takeaway 3: A Clear Rule Violation Doesn’t Guarantee a Win in Court

One of the most surprising aspects of this case is that the facts of the violation were not in dispute. The judge explicitly acknowledged that the neighbors were in violation of the Architectural Review Committee’s requirement. The official decision states:

“Based upon the evidence provided, the Kinstle’s are in violation of the requirement the ARC Committee imposed on them.”

Despite this clear violation by the neighbor, the homeowner, Mr. Pierce, still lost his case against the HOA.

The case was lost on a critical legal distinction: the lawsuit was not about the neighbor’s violation, but about the HOA’s alleged failure to act. Since the judge determined the HOA had the discretionary right—not the mandatory obligation—to enforce the rule, its choice to pursue negotiation rather than immediate punitive action was not considered a violation of its duties.

The lesson here is profound: proving a neighbor is breaking the rules is only the first step. To win a case against your HOA for non-enforcement, you must also prove that its response (or lack thereof) constitutes a breach of its specific duties as outlined in your community’s governing documents.

Conclusion: Know Your Documents, Temper Your Expectations

The case of Pierce v. Sierra Morado Community Association serves as a stark reminder that HOA governance is often more complex than it appears. The precise wording of your community’s CC&Rs is critically important, as a single phrase can be the difference between a mandatory duty and a discretionary power. This case illustrates that the gap between a rule existing on paper and the board’s power to enforce it can be vast.

As a homeowner, your first step should be to obtain a copy of your community’s most recent CC&Rs and search for the enforcement clause—does it say your board “shall” enforce the rules, or does it say they have the “right” to?

This case forces every homeowner to ask: If your governing documents give your board the ‘right’ to act, what leverage do you truly have to ensure they actually will?


Case Participants

Petitioner Side

  • Erik R. Pierce (petitioner)
  • James C. Frisch (petitioner attorney)
    King & Frisch, P.C.
  • Michael Resare (petitioner attorney)

Respondent Side

  • Nicholas C.S. Nogami (respondent attorney)
    Carpenter, Hazlewood, Delgado & Bolen, LLP
  • Heather M. Hampstead (respondent attorney)
    Carpenter, Hazlewood, Delgado & Bolen, LLP
  • Jodie Cervantes (property manager/witness)
    AAM, LLC
    Community Manager for Respondent SMCA
  • Bill Oliver (board member/witness)
    Former SMCA President (Fall 2019 to April 2020)
  • Martin Douglas (board member/witness)
    Current SMCA Board President (since April 2020)

Neutral Parties

  • Adam D. Stone (ALJ)
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate
  • LDettorre (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • AHansen (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • djones (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • DGardner (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • ncano (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • c. serrano (clerk)
    Signed document transmission

Erik R. Pierce v. Sierra Morado Community Association

Posted on by

Case Summary

Case ID 20F-H2020053-REL
Agency ADRE
Tribunal OAH
Decision Date 2021-02-10
Administrative Law Judge Adam D. Stone
Outcome none
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Erik R. Pierce Counsel James C. Frisch
Respondent Sierra Morado Community Association Counsel Nicholas C.S. Nogami and Heather M. Hampstead

Alleged Violations

Article 11, Section 11.1

Outcome Summary

The Administrative Law Judge denied the petition, concluding that the Respondent HOA did not violate CC&R Section 11.1 because that section grants the Board discretion, rather than a mandatory obligation, in the timing of enforcement actions.

Why this result: The Petitioner failed to meet the burden of proof to establish that the Respondent violated CC&R Section 11.1, as the ALJ found the Board's decision to temporarily delay enforcement pending litigation and settlement discussions fell within the discretion granted by the CC&R.

Key Issues & Findings

Failure of HOA to Enforce Architectural Approval Conditions (Hot Tub Screening)

Petitioner alleged that the HOA failed to enforce the mandatory installation of a pergola and screening around a neighbor's hot tub, a condition imposed by the Architectural Review Committee when retroactively approving the installation.

Orders: Petitioner's petition is denied.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199(B)
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • CC&R Article 11, Section 11.1
  • CC&R Article 4, Section 4.27

Analytics Highlights

Topics: HOA Enforcement, CC&R Dispute, Architectural Control, Discretionary Enforcement
Additional Citations:

  • A.R.S. § 32-2199(B)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 32-2199.04
  • A.R.S. § 41-1092.07(G)(2)
  • A.R.S. § 41-1092.09
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • CC&R Article 4, Section 4.27
  • CC&R Article 11, Section 11.1
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
  • MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5 (1960)
  • BLACK’S LAW DICTIONARY at page 1220 (8th ed. 1999)

Video Overview

Audio Overview

Decision Documents

20F-H2020053-REL Decision – 850237.pdf

Uploaded 2025-10-09T03:35:12 (43.0 KB)

20F-H2020053-REL Decision – 850239.pdf

Uploaded 2025-10-09T03:35:12 (7.1 KB)

20F-H2020053-REL Decision – 853778.pdf

Uploaded 2025-10-09T03:35:12 (119.9 KB)





Briefing Doc – 20F-H2020053-REL


Administrative Hearing Briefing: Pierce v. Sierra Morado Community Association

Executive Summary

This briefing synthesizes the key findings and judicial decision in the administrative case of Erik R. Pierce versus the Sierra Morado Community Association (SMCA), Case No. 20F-H2020053-REL. The petition, filed by homeowner Erik R. Pierce, was ultimately denied by the Administrative Law Judge on February 10, 2021.

The core of the dispute was Pierce’s allegation that the SMCA failed to enforce its Covenants, Conditions, and Restrictions (CC&Rs) against his neighbors, the Kinstles, who installed a hot tub visible from Pierce’s property, creating a privacy violation. While the SMCA Board retroactively approved the hot tub, it did so with the explicit condition that a pergola and screening be installed to mitigate the visibility issue. The Kinstles subsequently failed to install the required screening.

The judge concluded that the SMCA’s conditional approval resolved the initial violation claim under CC&R Section 4.27. The central issue then became whether the SMCA’s subsequent failure to compel the installation of the screening constituted a violation of its enforcement duty under CC&R Section 11.1. The judge ruled that it did not, finding that the CC&Rs grant the Association a discretionary right to enforce its rules, not an absolute obligation. The judge found persuasive the SMCA’s testimony that it delayed enforcement actions due to the ongoing litigation and in an attempt to foster a settlement between the neighbors. This exercise of discretion was deemed permissible under the Association’s governing documents.

1. Case Overview

Parties and Legal Representation

Entity

Legal Counsel

Petitioner

Erik R. Pierce

James C. Frisch, Esq. & Michael Resare, Esq. (King & Frisch, P.C.)

Respondent

Sierra Morado Community Association (SMCA)

Heather M. Hampstead, Esq. & Nicholas C.S. Nogami, Esq. (Carpenter, Hazlewood, Delgado & Bolen, LLP)

Key Case Details

• Case Number: 20F-H2020053-REL

• Presiding Judge: Adam D. Stone, Administrative Law Judge

• Hearing Date: January 25, 2021 (conducted via Google Meet)

• Decision Date: February 10, 2021

• Jurisdiction: The Arizona Department of Real Estate (ADRE) is statutorily authorized to hear petitions from homeowners’ association members. This case was referred by the ADRE to the Office of Administrative Hearings for an evidentiary hearing.

2. Core Dispute and Allegations

Petitioner’s Complaint

On March 23, 2020, Erik R. Pierce filed a complaint with the ADRE alleging that the SMCA was in violation of its own CC&Rs, specifically Sections 4.27 (Swimming Pools and Spas) and 11.1 (Enforcement).

The dispute originated with the installation of a hot tub by Pierce’s neighbors, the Kinstles. Pierce testified that the hot tub and its occupants were visible from inside his house, and that occupants of the hot tub could look directly into his home, violating his right to privacy.

Timeline of Key Events

• September 4, 2019: Pierce submits his initial complaint to the SMCA, noting the hot tub’s visibility and asserting that the Kinstles had failed to obtain prior approval from the Architectural Review Committee (ARC).

• Post-September 2019: The SMCA informs the Kinstles that they installed the hot tub without approval and directs them to submit plans for the proper approval process.

• February 10, 2020: After several rejections, the SMCA Board approves the Kinstles’ hot tub installation on the condition that a pergola and screening are installed.

• March 3, 2020: Pierce receives a letter from the property management company, AAM, LLC, stating that the installation was approved with the screening requirement and that the complaint was closed.

• January 25, 2021: At the time of the hearing, the Kinstles had still not installed the required pergola and screening.

3. Analysis of Key Testimonies

The decision was informed by testimony from four witnesses presented by the Petitioner.

• Erik R. Pierce (Petitioner): Outlined the timeline of the dispute, the visibility of the neighbors’ hot tub, the resulting privacy violation, and the SMCA Board’s failure to enforce its own conditional approval requiring a pergola and screening.

• Bill Oliver (Former SMCA President, Fall 2019 – April 2020): Confirmed that the Board approved the hot tub retroactively with the stipulation for a pergola and screening. He stated the Board had a “rigorous process of enforcement” but could not recall if a specific violation letter was sent to the Kinstles after the conditional approval was granted.

• Jodie Cervantes (Former Community Manager, 2019 – June 2020): Testified that she believed the CC&Rs were enforced and the matter was closed. She suggested the Kinstles had a six-month period to comply with the screening requirement, which she believed was in the Design Guidelines, but could not point to the specific language.

• Martin Douglas (Current SMCA President, from April 2020): Stated he had been to the Pierce residence for another matter and the hot tub was not visible to him. He attributed the lack of enforcement action to the “ongoing litigation and multiple settlement offers which were being exchanged.” He testified that upon resolution of the case, the Board “will follow through with enforcement actions should the Kinstle’s fail to comply.”

4. Judicial Reasoning and Decision

The Administrative Law Judge’s decision centered on the interpretation of the SMCA’s CC&Rs and the discretionary power of its Board.

Governing CC&R Provisions

The ruling rested on the specific language of two sections of the SMCA CC&Rs:

• Section 4.27 (Swimming Pools and Spas): This section permits the installation of a hot tub only if it is “properly screened… if neither it nor its occupants are Visible from Neighboring Property, and with the prior written approval of the Architectural Review Committee.”

• Section 11.1 (Enforcement): This section states that “The Association or any Owner shall have the right to enforce the Project Documents… The failure of the Association or an Owner to take enforcement action with respect to a violation of the Project Documents shall not constitute or be deemed a waiver of the right of the Association or any Owner to enforce the Project Documents in the future.”

Administrative Law Judge’s Conclusions

1. Resolution of the Section 4.27 Claim: The judge determined that the initial issue regarding the unapproved hot tub “was essentially resolved by the Board instructing the Kinstle’s erect a pergola and install screening.” By making its approval conditional on a privacy solution, the Board addressed the core requirement of the section.

2. The “Heart of the Matter” – Section 11.1 Enforcement: The judge identified the central question as whether the SMCA violated Section 11.1 by failing to enforce the screening requirement against the Kinstles.

3. Discretionary vs. Mandatory Enforcement: The judge concluded that the language of Section 11.1 grants the Board a “right to enforce, not an absolute obligation.”

4. Rationale for Delayed Enforcement: The judge found the testimony of the current SMCA President, Martin Douglas, to be “more persuasive.” Douglas’s explanation—that the Board delayed enforcement to “foster an agreement with the neighbors” amid ongoing litigation—was accepted as a valid exercise of the Board’s discretion.

5. Final Ruling: The judge stated, “Section 11.1 expressly granted the Board this discretion, and it should not be disturbed.” Consequently, the judge ruled that the Petitioner failed to prove by a preponderance of the evidence that the Respondent had violated CC&R Section 11.1.

Final Order

IT IS ORDERED that Petitioners’ petition is denied.

The order was issued on February 10, 2021, and is binding unless a rehearing is granted.






Study Guide – 20F-H2020053-REL


Study Guide: Pierce v. Sierra Morado Community Association (Case No. 20F-H2020053-REL)

This study guide provides a review of the administrative hearing concerning the dispute between Erik R. Pierce and the Sierra Morado Community Association. It includes a short-answer quiz, an answer key, suggested essay questions, and a comprehensive glossary of terms and entities involved in the case.

Short-Answer Quiz

Answer each of the following questions in two to three complete sentences, based on the provided source documents.

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

2. What was the initial reason for Mr. Pierce’s complaint against his neighbors, the Kinstles?

3. Which two sections of the Sierra Morado Community Association (SMCA) CC&Rs did Mr. Pierce allege were violated?

4. What action did the SMCA Board take after being informed that the Kinstles had installed a hot tub without prior approval?

5. What specific conditions did the SMCA Board require for the retroactive approval of the Kinstles’ hot tub installation?

6. According to former Board President Bill Oliver’s testimony, what was the Board’s common practice regarding architectural requests made after an installation?

7. What reason did Community Manager Jodie Cervantes give for her belief that no further enforcement action could be taken against the Kinstles?

8. According to current SMCA Board President Martin Douglas, why had the Board delayed enforcement actions against the Kinstles?

9. What was the Administrative Law Judge’s final decision regarding the alleged violation of CC&R Section 11.1?

10. How did the judge interpret the Board’s enforcement power as described in Section 11.1 of the CC&Rs?

——————————————————————————–

Answer Key

1. The primary parties were Erik R. Pierce, who was the Petitioner filing the complaint, and the Sierra Morado Community Association (SMCA), which was the Respondent. Mr. Pierce is a homeowner and member of the SMCA.

2. Mr. Pierce’s complaint originated because his neighbors, the Kinstles, installed a hot tub that was visible from his backyard. He testified that occupants in the hot tub were visible from inside his house, violating his privacy.

3. The Petitioner, Mr. Pierce, alleged that the Respondent, SMCA, was in violation of sections 4.27 and 11.1 of the SMCA CC&Rs. Section 4.27 pertains to the installation of spas, and Section 11.1 addresses the enforcement of project documents.

4. After Mr. Pierce filed his complaint, the SMCA informed the Kinstles that they had installed the hot tub without approval. The Board then directed the Kinstles to submit their plans and go through the proper architectural approval process.

5. The Kinstles’ hot tub was approved retroactively on February 10, 2020, on the condition that they install a pergola and screening. This was intended to address the visibility of the hot tub from Mr. Pierce’s property.

6. Bill Oliver, the SMCA President from fall 2019 to April 2020, testified that the Board would approve architectural requests retroactively. He confirmed that this is what occurred in the case of the Kinstles’ hot tub.

7. Jodie Cervantes, the Community Manager, testified that she believed the matter was closed because the Kinstles had six months to comply with the pergola and screening requirements. She believed this six-month deadline was outlined in the Design Guidelines, though she could not locate the specific language.

8. Martin Douglas, who became Board President in April 2020, testified that the Board delayed enforcement actions due to the ongoing litigation. He stated that multiple settlement offers were being exchanged in an effort to foster an agreement between the neighbors.

9. The Administrative Law Judge ordered that the Petitioner’s petition be denied. The judge concluded that Mr. Pierce did not establish by a preponderance of the evidence that the SMCA had violated CC&R Section 11.1.

10. The judge determined that Section 11.1 grants the Board a right to enforce the rules, not an absolute obligation to do so. This interpretation means the Board has the discretion to delay enforcement, which it did in this case to facilitate a potential settlement.

——————————————————————————–

Essay Questions

The following questions are designed for longer, essay-style responses. Use evidence and testimony from the case documents to construct a thorough analysis. No answers are provided.

1. Explain the legal standard of “preponderance of the evidence” as defined in the Administrative Law Judge’s decision. Analyze why the Petitioner, Erik R. Pierce, failed to meet this burden of proof concerning the violation of CC&R Section 11.1.

2. Trace the timeline of events from Mr. Pierce’s initial complaint on September 4, 2019, to the final decision on February 10, 2021. Discuss the key actions, delays, and decisions made by the SMCA Board during this period.

3. Compare and contrast the testimonies of Bill Oliver, Jodie Cervantes, and Martin Douglas. How do their different roles and timeframes with the SMCA shape their perspectives on the association’s enforcement process and the specific handling of the Kinstle case?

4. Analyze the Administrative Law Judge’s interpretation of CC&R Section 11.1. Discuss the distinction made between a “right to enforce” and an “absolute obligation,” and explain how this interpretation was central to the final ruling.

5. Based on the judge’s findings and the testimony of Martin Douglas, what are the likely next steps for the SMCA regarding the Kinstles’ non-compliance with the pergola and screening requirement? Evaluate the potential for future conflict or resolution between the parties involved.

——————————————————————————–

Glossary of Key Terms

Term / Entity

Definition

AAM, LLC

The property management company that employed Community Manager Jodie Cervantes and managed the Sierra Morado Community Association during the period of the dispute.

Administrative Law Judge (ALJ)

The official who presides over administrative hearings. In this case, the ALJ was Adam D. Stone of the Office of Administrative Hearings.

Architectural Committee (ARC)

The committee within the SMCA responsible for approving construction, installations, and alterations to properties, as referenced in CC&R Section 4.27.

Arizona Department of Real Estate (ADRE)

The state agency authorized by statute to receive and decide Petitions for Hearing from members of homeowners’ associations. Mr. Pierce filed his initial complaint with this department.

Burden of Proof

The obligation on a party in a legal case to prove its allegations. In this case, the Petitioner had the burden to establish his claim by a “preponderance of the evidence.”

Covenants, Conditions, and Restrictions. These are the governing documents or rules of a planned community. The dispute centered on alleged violations of Sections 4.27 (Swimming Pools and Spas) and 11.1 (Enforcement).

Hearing

The formal proceeding held on January 25, 2021, where the parties presented exhibits and witness testimony to the Administrative Law Judge.

Office of Administrative Hearings

An independent state agency that conducts evidentiary hearings for other state agencies, such as the Department of Real Estate.

Petitioner

The party who files a petition or complaint to initiate a legal proceeding. In this case, the Petitioner was Erik R. Pierce.

Preponderance of the Evidence

The evidentiary standard required for the Petitioner to win the case. It is defined as proof that convinces the trier of fact that a contention is “more probably true than not.”

Respondent

The party against whom a petition or complaint is filed. In this case, the Respondent was the Sierra Morado Community Association (SMCA).

Retroactive Approval

The act of approving an architectural installation (such as a hot tub) after it has already been completed, which the SMCA Board did in this case.

Sierra Morado Community Association (SMCA)

The homeowners’ association in Tucson, Arizona, of which Erik R. Pierce and the Kinstles are members.

Stipulation

An agreement between the parties in a legal proceeding. In this case, the parties stipulated to enter all submitted exhibits into the record.






Blog Post – 20F-H2020053-REL


Your HOA Can Ignore Its Own Rules? A Surprising Legal Case Every Homeowner Needs to Understand

Introduction: The Homeowner’s Dilemma

Most homeowners in a planned community operate under a simple assumption: if a neighbor violates a clear rule, you can file a complaint, and the Homeowners Association (HOA) is required to take action. It’s the fundamental promise of an HOA—consistent enforcement to protect property values and quality of life.

But what happens when the HOA agrees a violation has occurred, demands a fix, and then… does nothing to enforce it?

A real-world legal case, Erik R. Pierce versus the Sierra Morado Community Association, provides a surprising and cautionary answer. The final court decision reveals a critical loophole that may exist in your own HOA agreement. This article will break down the three most counter-intuitive takeaways from that case that every homeowner should understand.

Takeaway 1: “A Right to Enforce” Isn’t an “Obligation to Enforce”

The core of the dispute was straightforward. Homeowner Erik Pierce filed a complaint because his neighbors, the Kinstles, installed a hot tub that was visible from his property, a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs)—the legally binding rules that govern the community. The HOA’s Architectural Committee retroactively approved the hot tub, but only on the condition that the neighbors install a pergola and screening to shield it from view.

The neighbors never installed the required screening, yet the HOA took no further enforcement action. This inaction led Mr. Pierce to sue the HOA.

The judge’s decision hinged on a crucial interpretation of the HOA’s governing documents. The judge ruled in favor of the HOA because the documents gave the Board the right to enforce the rules, not an absolute obligation to do so. This distinction granted the HOA discretion to choose its strategy. The judge found the board’s reasoning for the delay persuasive: it was deliberately choosing negotiation over immediate punitive action to resolve the conflict. The board’s discretion wasn’t just a right to do nothing; it was a right to choose a different path to compliance.

The key phrase here is “shall have the right to enforce.” Had the documents stated the board “shall enforce,” the outcome would likely have been entirely different. This single phrase transforms enforcement from a mandate into a strategic option for the board.

The Administrative Law Judge’s decision highlights this critical point:

“…Section 11.1 only gives the Board a right to enforce, not an absolute obligation. While Petitioner is understandably upset that there has yet to be any follow through on enforcement of the screening requirements, this tribunal finds the testimony of Mr. Douglas more persuasive, namely that the Board has delayed in enforcing because it was trying to foster an agreement with the neighbors. Section 11.1 expressly granted the Board this discretion, and it should not be disturbed.”

This finding is shocking for most homeowners, who reasonably assume that the rules laid out in their CC&Rs are mandates for the board, not a menu of discretionary options.

Takeaway 2: Suing Your HOA Can Ironically Pause Enforcement

The board’s discretionary power was put on full display when Mr. Pierce filed his lawsuit, creating a legal Catch-22. The current SMCA Board President, Martin Douglas, testified that the board deliberately paused formal enforcement actions against the neighbors who had violated the architectural requirement.

The judge ultimately found that the board’s rationale for this pause was a valid exercise of its discretion. The decision to delay was framed not as inaction, but as a strategic choice “to foster an agreement with the neighbors” amidst the complexities of litigation.

This reveals a deep irony: by filing a petition to force the HOA’s hand, the homeowner inadvertently provided the context for the HOA to justify a delay. The judge accepted that the board’s attempt to find a negotiated solution instead of escalating fines and penalties during an active lawsuit was a reasonable use of its discretionary authority. This case demonstrates how legal action, intended to accelerate a resolution, can sometimes be used by an HOA board to justify a different, slower approach.

Takeaway 3: A Clear Rule Violation Doesn’t Guarantee a Win in Court

One of the most surprising aspects of this case is that the facts of the violation were not in dispute. The judge explicitly acknowledged that the neighbors were in violation of the Architectural Review Committee’s requirement. The official decision states:

“Based upon the evidence provided, the Kinstle’s are in violation of the requirement the ARC Committee imposed on them.”

Despite this clear violation by the neighbor, the homeowner, Mr. Pierce, still lost his case against the HOA.

The case was lost on a critical legal distinction: the lawsuit was not about the neighbor’s violation, but about the HOA’s alleged failure to act. Since the judge determined the HOA had the discretionary right—not the mandatory obligation—to enforce the rule, its choice to pursue negotiation rather than immediate punitive action was not considered a violation of its duties.

The lesson here is profound: proving a neighbor is breaking the rules is only the first step. To win a case against your HOA for non-enforcement, you must also prove that its response (or lack thereof) constitutes a breach of its specific duties as outlined in your community’s governing documents.

Conclusion: Know Your Documents, Temper Your Expectations

The case of Pierce v. Sierra Morado Community Association serves as a stark reminder that HOA governance is often more complex than it appears. The precise wording of your community’s CC&Rs is critically important, as a single phrase can be the difference between a mandatory duty and a discretionary power. This case illustrates that the gap between a rule existing on paper and the board’s power to enforce it can be vast.

As a homeowner, your first step should be to obtain a copy of your community’s most recent CC&Rs and search for the enforcement clause—does it say your board “shall” enforce the rules, or does it say they have the “right” to?

This case forces every homeowner to ask: If your governing documents give your board the ‘right’ to act, what leverage do you truly have to ensure they actually will?


Case Participants

Petitioner Side

  • Erik R. Pierce (petitioner)
  • James C. Frisch (petitioner attorney)
    King & Frisch, P.C.
  • Michael Resare (petitioner attorney)

Respondent Side

  • Nicholas C.S. Nogami (respondent attorney)
    Carpenter, Hazlewood, Delgado & Bolen, LLP
  • Heather M. Hampstead (respondent attorney)
    Carpenter, Hazlewood, Delgado & Bolen, LLP
  • Jodie Cervantes (property manager/witness)
    AAM, LLC
    Community Manager for Respondent SMCA
  • Bill Oliver (board member/witness)
    Former SMCA President (Fall 2019 to April 2020)
  • Martin Douglas (board member/witness)
    Current SMCA Board President (since April 2020)

Neutral Parties

  • Adam D. Stone (ALJ)
  • Judy Lowe (Commissioner)
    Arizona Department of Real Estate
  • LDettorre (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • AHansen (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • djones (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • DGardner (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • ncano (unknown)
    Arizona Department of Real Estate
    Transmission recipient
  • c. serrano (clerk)
    Signed document transmission