The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.
Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.
Key Issues & Findings
Alleged violation of CC&Rs regarding disproportionate assessment fees
Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.
Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 32-2199 et seq.
A.R.S. § 32-2199.01(D)
A.R.S. § 32-2199.02
A.A.C. R2-19-119(B)
Analytics Highlights
Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.01
A.R.S. § 32-2199.02
A.A.C. R2-19-119
Video Overview
Audio Overview
Decision Documents
17F-H1717033-REL Decision – 575166.pdf
Uploaded 2025-10-09T03:31:37 (39.1 KB)
17F-H1717033-REL Decision – 582189.pdf
Uploaded 2025-10-09T03:31:37 (69.4 KB)
17F-H1717033-REL Decision – 584918.pdf
Uploaded 2025-10-09T03:31:37 (674.1 KB)
Briefing Doc – 17F-H1717033-REL
Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA
Executive Summary
This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.
The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.
The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.
Case Overview
The following table outlines the principal parties and details of the administrative hearing.
Case Detail
Information
Petitioner
Jay Janicek
Respondent
Sycamore Vista No. 8 HOA
Respondent’s Counsel
Evan Thompson, Thompson Krone PLC
Respondent’s Representative
Steve Russo
Case Number
17F-H1717033-REL
Docket Number
17F-H1717033-REL
Hearing Date
July 12, 2017
Presiding Judge
Dorinda M. Lang, Administrative Law Judge
Hearing Observers
John Shields, Margery and Mathew Janicek
Petitioner’s Allegations
The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:
• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.
• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:
• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.
• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.
Adjudication and Findings of Fact
The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.
Evidentiary Failure
The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.
• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”
• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”
• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.
Lack of Legal Authority
The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.
• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”
• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.
Post-Hearing Submissions
The record was held open until August 1, 2017, allowing for additional documentation from both parties.
• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.
• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”
Conclusions of Law and Final Decision
Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.
Denial of Petition
• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”
• The payment for Common Areas was found to be in comportment with the CC&Rs.
Rejection of Key Arguments
• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”
• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”
Timeline of Orders
1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.
2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.
3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.
Post-Decision Procedures
The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.
• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.
• A rehearing may be granted for the following causes:
1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.
2. Misconduct by the Department, ALJ, or the prevailing party.
3. Accident or surprise that could not have been prevented by ordinary prudence.
4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.
5. Excessive or insufficient penalties.
6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.
7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.
8. The findings of fact or decision is not supported by the evidence or is contrary to law.
• Parties may appeal the final administrative action by filing a complaint for judicial review.
Study Guide – 17F-H1717033-REL
Study Guide: Janicek v. Sycamore Vista No. 8 HOA
This guide provides a comprehensive review of the administrative hearing case No. 17F-H1717033-REL, Jay Janicek v. Sycamore Vista No. 8 HOA. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms to facilitate a thorough understanding of the case’s facts, arguments, and legal conclusions.
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Short-Answer Quiz
Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the case documents.
1. Who were the primary parties in this legal matter, and what were their designated roles?
2. What was the central allegation made by the Petitioner against the Respondent?
3. Which specific article and section of the Covenants, Conditions, and Restrictions (CC&Rs) did the Petitioner claim the Respondent had violated?
4. Explain the key piece of evidence that was missing and why its absence was critical to the case’s outcome.
5. What was the Respondent’s main argument regarding the fees paid to the Master HOA?
6. According to the case documents, who held the burden of proof, and what was the required standard of proof?
7. What was the “rule against perpetuities,” and what reason did the Administrative Law Judge give for its inapplicability to this case?
8. What was the ultimate decision of the Administrative Law Judge, and on what date was it issued?
9. After the hearing, the record was held open. What was the purpose of this, and what types of materials were submitted by the parties during this period?
10. What action did the Commissioner of the Department of Real Estate take after receiving the Administrative Law Judge’s decision?
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Answer Key
1. The primary parties were Jay Janicek, designated as the Petitioner, and Sycamore Vista No. 8 HOA, designated as the Respondent. The Petitioner is the party who filed the complaint, and the Respondent is the party against whom the complaint was filed.
2. The Petitioner alleged that the Respondent HOA was in violation of its CC&Rs. He argued that the fees his association paid to the Master HOA for a roadway loan did not benefit the whole development equally and were therefore inappropriate expenses for all homeowners to pay.
3. The Petitioner cited Article 11, Section 11.5 of the Respondent’s CC&Rs. This section, titled “Costs of Improvements,” details how the costs for improving Unimproved Lots and Common Areas in Phase 3 and Phase 4 are to be borne by the owners of lots within those specific phases.
4. The key missing evidence was a plat, referred to as “Exhibit B” in the CC&Rs. This plat was supposed to define the “Common Areas,” and without it, the Petitioner was unable to establish that the fees paid by the Respondent were for anything not provided for in the governing documents.
5. The Respondent argued that the Master HOA fees were used to pay for the development’s common areas. They maintained that the CC&Rs permit these payments and that there is no legal authority requiring all homeowners to receive the same benefit or for all first-level associations to contribute equally.
6. Pursuant to A.A.C. R2-19-119(B), the Petitioner, Jay Janicek, had the burden of proof in this matter. The standard of proof was a preponderance of the evidence, as established by A.A.C. R2-19-119(A).
7. The rule against perpetuities states that property ownership must vest within a time frame of an existing lifetime plus 21 years. The Judge ruled it did not apply because it evolved to handle estates bequeathed to a series of heirs and is not generally applicable to property sales where rights transfer at once; in the HOA’s case, ownership of undeveloped lots had already vested in the developer.
8. The Administrative Law Judge ordered that the Petitioner’s petition be denied. This decision was made on August 14, 2017.
9. The record was held open until August 1, 2017, to allow the Respondent to submit additional documentation and for the Petitioner to submit written objections. During this time, the Petitioner submitted financial documentation, emails, and a new argument about the rule against perpetuities (admitted as Exhibit 6), while the Respondent submitted a Notice of Lien (admitted as Exhibit H).
10. The Commissioner of the Department of Real Estate, Judy Lowe, adopted the Administrative Law Judge’s decision. This was formalized in a Final Order dated August 21, 2017, which accepted the ALJ’s recommendation and denied the Petitioner’s petition.
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Essay Questions
Instructions: The following questions are designed for a more in-depth analysis of the case. Formulate a detailed essay-style response for each.
1. Analyze the critical evidentiary failure that led to the denial of Jay Janicek’s petition. How did the absence of the plat referred to as “Exhibit B” directly impact his ability to meet the “preponderance of the evidence” standard of proof?
2. Discuss the legal reasoning behind the Administrative Law Judge’s conclusion that there is no requirement for HOA fees to be “even-handed or equally beneficial to all homeowners.” How does this principle relate to the hierarchical structure of Master and first-level associations described in the case?
3. Explain the concept of the “rule against perpetuities” as described in the legal decision. Detail why the Administrative Law Judge, despite noting the argument was outside the original petition, addressed it and ultimately found it inapplicable to the case of a homeowner’s association.
4. Trace the procedural path of this case from the initial hearing to the final binding order. Identify the key dates, decisions, and entities involved at each stage, including the Office of Administrative Hearings and the Department of Real Estate.
5. Based on the Final Order, outline the process and potential grounds for requesting a rehearing. What were the eight specific causes listed in the order that could materially affect a moving party’s rights and justify a rehearing or review?
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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. In this case, Dorinda M. Lang served as the ALJ.
A.A.C.
Abbreviation for Arizona Administrative Code, a compilation of rules and regulations of Arizona state agencies.
A.R.S.
Abbreviation for Arizona Revised Statutes, the collection of all the laws of the state of Arizona.
Areas of Association Responsibility
Locations that the Homeowner’s Association is responsible for maintaining, as defined within its governing documents.
Burden of Proof
The legal obligation of a party in a dispute to provide sufficient evidence to prove their claim. In this case, the burden of proof was on the Petitioner.
Covenants, Conditions, and Restrictions. These are the governing legal documents that set up the rules for a planned community or subdivision.
Common Areas
Areas within a housing development that are owned by the association for the use and benefit of all homeowners. The definition of these areas was a central issue in the case.
Commissioner
The head of a government department. In this context, Judy Lowe, the Commissioner of the Arizona Department of Real Estate, who adopted the ALJ’s decision.
First Level Association
An individual homeowner’s association within a larger development that also has a master association. The Respondent, Sycamore Vista No. 8 HOA, is a first level association.
Master HOA
The Sycamore Vista Master Home Owner’s Association. An overarching organization that governs expenses and common areas concerning an entire development composed of multiple first-level associations.
Office of Administrative Hearings (OAH)
The state agency that conducts administrative hearings for other state agencies. This case was referred to the OAH by the Department of Real Estate.
Petitioner
The party who files a petition or brings an action in a legal proceeding. In this case, Jay Janicek.
A map, drawn to scale, showing the divisions of a piece of land. The missing plat in this case was intended to show the “Common Areas.”
Preponderance of the Evidence
The standard of proof in most civil cases. It requires that the evidence shows a claim is more likely to be true than not true.
Respondent
The party against whom a petition is filed or who is responding to a legal action. In this case, Sycamore Vista No. 8 HOA.
Rule Against Perpetuities
A legal rule that prevents a property owner from controlling the disposition of their property for an indefinite period after their death. The ALJ found it did not apply in this HOA context.
Unimproved Lot Assessments
Fees imposed on the owners of undeveloped lots to pay for the costs of improving certain areas, as described in Section 6.13 of the CC&Rs.
Unimproved Lots
Parcels of land within the development that have not yet been built upon.
Blog Post – 17F-H1717033-REL
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17F-H1717033-REL
3 sources
These documents chronicle the legal proceedings of a dispute between Jay Janicek, the Petitioner, and Sycamore Vista No. 8 HOA, the Respondent, before the Office of Administrative Hearings. The first source is an “Order Holding Record Open,” dated July 12, 2017, which temporarily extends the deadline for submitting additional evidence. The subsequent sources contain the “Administrative Law Judge Decision” issued on August 14, 2017, which outlines the hearing details and the judge’s recommendation to deny the petition because Janicek failed to establish a violation of the HOA’s Covenants, Conditions, and Restrictions. Finally, the third document presents the “Final Order” from the Department of Real Estate Commissioner on August 21, 2017, which accepts and affirms the Administrative Law Judge’s decision to deny the petition. Janicek’s core claim argued that certain master association fees were disproportionately applied and did not benefit all homeowners equally, which the judge ultimately dismissed due to a lack of supporting legal authority or CC&R provisions.
Based on 3 sources
Case Participants
Petitioner Side
Jay Janicek(petitioner)
Respondent Side
Evan Thompson(HOA attorney) Thompson Krone PLC Attorney for Respondent
Steve Russo(respondent representative)
Neutral Parties
Dorinda M. Lang(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Dan Gardner(HOA Coordinator) Office of Administrative Hearings Addressee for rehearing request
Other Participants
John Shields(observer)
Margery Janicek(observer)
Mathew Janicek(observer)
M. Aguirre(unknown) Thompson Krone PLC Listed on transmittal documents
The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.
Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.
Key Issues & Findings
Alleged violation of CC&Rs regarding disproportionate assessment fees
Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.
Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 32-2199 et seq.
A.R.S. § 32-2199.01(D)
A.R.S. § 32-2199.02
A.A.C. R2-19-119(B)
Analytics Highlights
Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.01
A.R.S. § 32-2199.02
A.A.C. R2-19-119
Video Overview
Audio Overview
Decision Documents
17F-H1717033-REL Decision – 575166.pdf
Uploaded 2026-01-23T17:20:21 (39.1 KB)
17F-H1717033-REL Decision – 582189.pdf
Uploaded 2026-01-23T17:20:24 (69.4 KB)
17F-H1717033-REL Decision – 584918.pdf
Uploaded 2026-01-23T17:20:27 (674.1 KB)
Briefing Doc – 17F-H1717033-REL
Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA
Executive Summary
This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.
The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.
The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.
Case Overview
The following table outlines the principal parties and details of the administrative hearing.
Case Detail
Information
Petitioner
Jay Janicek
Respondent
Sycamore Vista No. 8 HOA
Respondent’s Counsel
Evan Thompson, Thompson Krone PLC
Respondent’s Representative
Steve Russo
Case Number
17F-H1717033-REL
Docket Number
17F-H1717033-REL
Hearing Date
July 12, 2017
Presiding Judge
Dorinda M. Lang, Administrative Law Judge
Hearing Observers
John Shields, Margery and Mathew Janicek
Petitioner’s Allegations
The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:
• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.
• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:
• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.
• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.
Adjudication and Findings of Fact
The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.
Evidentiary Failure
The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.
• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”
• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”
• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.
Lack of Legal Authority
The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.
• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”
• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.
Post-Hearing Submissions
The record was held open until August 1, 2017, allowing for additional documentation from both parties.
• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.
• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”
Conclusions of Law and Final Decision
Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.
Denial of Petition
• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”
• The payment for Common Areas was found to be in comportment with the CC&Rs.
Rejection of Key Arguments
• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”
• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”
Timeline of Orders
1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.
2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.
3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.
Post-Decision Procedures
The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.
• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.
• A rehearing may be granted for the following causes:
1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.
2. Misconduct by the Department, ALJ, or the prevailing party.
3. Accident or surprise that could not have been prevented by ordinary prudence.
4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.
5. Excessive or insufficient penalties.
6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.
7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.
8. The findings of fact or decision is not supported by the evidence or is contrary to law.
• Parties may appeal the final administrative action by filing a complaint for judicial review.
Study Guide – 17F-H1717033-REL
Study Guide: Janicek v. Sycamore Vista No. 8 HOA
This guide provides a comprehensive review of the administrative hearing case No. 17F-H1717033-REL, Jay Janicek v. Sycamore Vista No. 8 HOA. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms to facilitate a thorough understanding of the case’s facts, arguments, and legal conclusions.
——————————————————————————–
Short-Answer Quiz
Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the case documents.
1. Who were the primary parties in this legal matter, and what were their designated roles?
2. What was the central allegation made by the Petitioner against the Respondent?
3. Which specific article and section of the Covenants, Conditions, and Restrictions (CC&Rs) did the Petitioner claim the Respondent had violated?
4. Explain the key piece of evidence that was missing and why its absence was critical to the case’s outcome.
5. What was the Respondent’s main argument regarding the fees paid to the Master HOA?
6. According to the case documents, who held the burden of proof, and what was the required standard of proof?
7. What was the “rule against perpetuities,” and what reason did the Administrative Law Judge give for its inapplicability to this case?
8. What was the ultimate decision of the Administrative Law Judge, and on what date was it issued?
9. After the hearing, the record was held open. What was the purpose of this, and what types of materials were submitted by the parties during this period?
10. What action did the Commissioner of the Department of Real Estate take after receiving the Administrative Law Judge’s decision?
——————————————————————————–
Answer Key
1. The primary parties were Jay Janicek, designated as the Petitioner, and Sycamore Vista No. 8 HOA, designated as the Respondent. The Petitioner is the party who filed the complaint, and the Respondent is the party against whom the complaint was filed.
2. The Petitioner alleged that the Respondent HOA was in violation of its CC&Rs. He argued that the fees his association paid to the Master HOA for a roadway loan did not benefit the whole development equally and were therefore inappropriate expenses for all homeowners to pay.
3. The Petitioner cited Article 11, Section 11.5 of the Respondent’s CC&Rs. This section, titled “Costs of Improvements,” details how the costs for improving Unimproved Lots and Common Areas in Phase 3 and Phase 4 are to be borne by the owners of lots within those specific phases.
4. The key missing evidence was a plat, referred to as “Exhibit B” in the CC&Rs. This plat was supposed to define the “Common Areas,” and without it, the Petitioner was unable to establish that the fees paid by the Respondent were for anything not provided for in the governing documents.
5. The Respondent argued that the Master HOA fees were used to pay for the development’s common areas. They maintained that the CC&Rs permit these payments and that there is no legal authority requiring all homeowners to receive the same benefit or for all first-level associations to contribute equally.
6. Pursuant to A.A.C. R2-19-119(B), the Petitioner, Jay Janicek, had the burden of proof in this matter. The standard of proof was a preponderance of the evidence, as established by A.A.C. R2-19-119(A).
7. The rule against perpetuities states that property ownership must vest within a time frame of an existing lifetime plus 21 years. The Judge ruled it did not apply because it evolved to handle estates bequeathed to a series of heirs and is not generally applicable to property sales where rights transfer at once; in the HOA’s case, ownership of undeveloped lots had already vested in the developer.
8. The Administrative Law Judge ordered that the Petitioner’s petition be denied. This decision was made on August 14, 2017.
9. The record was held open until August 1, 2017, to allow the Respondent to submit additional documentation and for the Petitioner to submit written objections. During this time, the Petitioner submitted financial documentation, emails, and a new argument about the rule against perpetuities (admitted as Exhibit 6), while the Respondent submitted a Notice of Lien (admitted as Exhibit H).
10. The Commissioner of the Department of Real Estate, Judy Lowe, adopted the Administrative Law Judge’s decision. This was formalized in a Final Order dated August 21, 2017, which accepted the ALJ’s recommendation and denied the Petitioner’s petition.
——————————————————————————–
Essay Questions
Instructions: The following questions are designed for a more in-depth analysis of the case. Formulate a detailed essay-style response for each.
1. Analyze the critical evidentiary failure that led to the denial of Jay Janicek’s petition. How did the absence of the plat referred to as “Exhibit B” directly impact his ability to meet the “preponderance of the evidence” standard of proof?
2. Discuss the legal reasoning behind the Administrative Law Judge’s conclusion that there is no requirement for HOA fees to be “even-handed or equally beneficial to all homeowners.” How does this principle relate to the hierarchical structure of Master and first-level associations described in the case?
3. Explain the concept of the “rule against perpetuities” as described in the legal decision. Detail why the Administrative Law Judge, despite noting the argument was outside the original petition, addressed it and ultimately found it inapplicable to the case of a homeowner’s association.
4. Trace the procedural path of this case from the initial hearing to the final binding order. Identify the key dates, decisions, and entities involved at each stage, including the Office of Administrative Hearings and the Department of Real Estate.
5. Based on the Final Order, outline the process and potential grounds for requesting a rehearing. What were the eight specific causes listed in the order that could materially affect a moving party’s rights and justify a rehearing or review?
——————————————————————————–
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. In this case, Dorinda M. Lang served as the ALJ.
A.A.C.
Abbreviation for Arizona Administrative Code, a compilation of rules and regulations of Arizona state agencies.
A.R.S.
Abbreviation for Arizona Revised Statutes, the collection of all the laws of the state of Arizona.
Areas of Association Responsibility
Locations that the Homeowner’s Association is responsible for maintaining, as defined within its governing documents.
Burden of Proof
The legal obligation of a party in a dispute to provide sufficient evidence to prove their claim. In this case, the burden of proof was on the Petitioner.
Covenants, Conditions, and Restrictions. These are the governing legal documents that set up the rules for a planned community or subdivision.
Common Areas
Areas within a housing development that are owned by the association for the use and benefit of all homeowners. The definition of these areas was a central issue in the case.
Commissioner
The head of a government department. In this context, Judy Lowe, the Commissioner of the Arizona Department of Real Estate, who adopted the ALJ’s decision.
First Level Association
An individual homeowner’s association within a larger development that also has a master association. The Respondent, Sycamore Vista No. 8 HOA, is a first level association.
Master HOA
The Sycamore Vista Master Home Owner’s Association. An overarching organization that governs expenses and common areas concerning an entire development composed of multiple first-level associations.
Office of Administrative Hearings (OAH)
The state agency that conducts administrative hearings for other state agencies. This case was referred to the OAH by the Department of Real Estate.
Petitioner
The party who files a petition or brings an action in a legal proceeding. In this case, Jay Janicek.
A map, drawn to scale, showing the divisions of a piece of land. The missing plat in this case was intended to show the “Common Areas.”
Preponderance of the Evidence
The standard of proof in most civil cases. It requires that the evidence shows a claim is more likely to be true than not true.
Respondent
The party against whom a petition is filed or who is responding to a legal action. In this case, Sycamore Vista No. 8 HOA.
Rule Against Perpetuities
A legal rule that prevents a property owner from controlling the disposition of their property for an indefinite period after their death. The ALJ found it did not apply in this HOA context.
Unimproved Lot Assessments
Fees imposed on the owners of undeveloped lots to pay for the costs of improving certain areas, as described in Section 6.13 of the CC&Rs.
Unimproved Lots
Parcels of land within the development that have not yet been built upon.
Blog Post – 17F-H1717033-REL
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17F-H1717033-REL
3 sources
These documents chronicle the legal proceedings of a dispute between Jay Janicek, the Petitioner, and Sycamore Vista No. 8 HOA, the Respondent, before the Office of Administrative Hearings. The first source is an “Order Holding Record Open,” dated July 12, 2017, which temporarily extends the deadline for submitting additional evidence. The subsequent sources contain the “Administrative Law Judge Decision” issued on August 14, 2017, which outlines the hearing details and the judge’s recommendation to deny the petition because Janicek failed to establish a violation of the HOA’s Covenants, Conditions, and Restrictions. Finally, the third document presents the “Final Order” from the Department of Real Estate Commissioner on August 21, 2017, which accepts and affirms the Administrative Law Judge’s decision to deny the petition. Janicek’s core claim argued that certain master association fees were disproportionately applied and did not benefit all homeowners equally, which the judge ultimately dismissed due to a lack of supporting legal authority or CC&R provisions.
Based on 3 sources
Case Participants
Petitioner Side
Jay Janicek(petitioner)
Respondent Side
Evan Thompson(HOA attorney) Thompson Krone PLC Attorney for Respondent
Steve Russo(respondent representative)
Neutral Parties
Dorinda M. Lang(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Dan Gardner(HOA Coordinator) Office of Administrative Hearings Addressee for rehearing request
Other Participants
John Shields(observer)
Margery Janicek(observer)
Mathew Janicek(observer)
M. Aguirre(unknown) Thompson Krone PLC Listed on transmittal documents
The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.
Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.
Key Issues & Findings
Alleged violation of CC&Rs regarding disproportionate assessment fees
Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.
Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 32-2199 et seq.
A.R.S. § 32-2199.01(D)
A.R.S. § 32-2199.02
A.A.C. R2-19-119(B)
Analytics Highlights
Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.01
A.R.S. § 32-2199.02
A.A.C. R2-19-119
Audio Overview
Decision Documents
17F-H1717033-REL Decision – 575166.pdf
Uploaded 2025-10-08T06:57:56 (39.1 KB)
17F-H1717033-REL Decision – 582189.pdf
Uploaded 2025-10-08T06:57:57 (69.4 KB)
17F-H1717033-REL Decision – 584918.pdf
Uploaded 2025-10-08T06:57:58 (674.1 KB)
Briefing Doc – 17F-H1717033-REL
Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA
Executive Summary
This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.
The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.
The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.
Case Overview
The following table outlines the principal parties and details of the administrative hearing.
Case Detail
Information
Petitioner
Jay Janicek
Respondent
Sycamore Vista No. 8 HOA
Respondent’s Counsel
Evan Thompson, Thompson Krone PLC
Respondent’s Representative
Steve Russo
Case Number
17F-H1717033-REL
Docket Number
17F-H1717033-REL
Hearing Date
July 12, 2017
Presiding Judge
Dorinda M. Lang, Administrative Law Judge
Hearing Observers
John Shields, Margery and Mathew Janicek
Petitioner’s Allegations
The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:
• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.
• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:
• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.
• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.
Adjudication and Findings of Fact
The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.
Evidentiary Failure
The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.
• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”
• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”
• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.
Lack of Legal Authority
The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.
• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”
• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.
Post-Hearing Submissions
The record was held open until August 1, 2017, allowing for additional documentation from both parties.
• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.
• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”
Conclusions of Law and Final Decision
Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.
Denial of Petition
• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”
• The payment for Common Areas was found to be in comportment with the CC&Rs.
Rejection of Key Arguments
• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”
• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”
Timeline of Orders
1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.
2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.
3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.
Post-Decision Procedures
The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.
• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.
• A rehearing may be granted for the following causes:
1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.
2. Misconduct by the Department, ALJ, or the prevailing party.
3. Accident or surprise that could not have been prevented by ordinary prudence.
4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.
5. Excessive or insufficient penalties.
6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.
7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.
8. The findings of fact or decision is not supported by the evidence or is contrary to law.
• Parties may appeal the final administrative action by filing a complaint for judicial review.
The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.
Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.
Key Issues & Findings
Alleged violation of CC&Rs regarding disproportionate assessment fees
Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.
Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 32-2199 et seq.
A.R.S. § 32-2199.01(D)
A.R.S. § 32-2199.02
A.A.C. R2-19-119(B)
Analytics Highlights
Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.01
A.R.S. § 32-2199.02
A.A.C. R2-19-119
Audio Overview
Decision Documents
17F-H1717033-REL Decision – 575166.pdf
Uploaded 2025-10-08T07:02:10 (39.1 KB)
17F-H1717033-REL Decision – 582189.pdf
Uploaded 2025-10-08T07:02:11 (69.4 KB)
17F-H1717033-REL Decision – 584918.pdf
Uploaded 2025-10-08T07:02:11 (674.1 KB)
Briefing Doc – 17F-H1717033-REL
Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA
Executive Summary
This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.
The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.
The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.
Case Overview
The following table outlines the principal parties and details of the administrative hearing.
Case Detail
Information
Petitioner
Jay Janicek
Respondent
Sycamore Vista No. 8 HOA
Respondent’s Counsel
Evan Thompson, Thompson Krone PLC
Respondent’s Representative
Steve Russo
Case Number
17F-H1717033-REL
Docket Number
17F-H1717033-REL
Hearing Date
July 12, 2017
Presiding Judge
Dorinda M. Lang, Administrative Law Judge
Hearing Observers
John Shields, Margery and Mathew Janicek
Petitioner’s Allegations
The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:
• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.
• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:
• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.
• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.
Adjudication and Findings of Fact
The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.
Evidentiary Failure
The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.
• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”
• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”
• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.
Lack of Legal Authority
The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.
• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”
• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.
Post-Hearing Submissions
The record was held open until August 1, 2017, allowing for additional documentation from both parties.
• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.
• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”
Conclusions of Law and Final Decision
Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.
Denial of Petition
• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”
• The payment for Common Areas was found to be in comportment with the CC&Rs.
Rejection of Key Arguments
• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”
• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”
Timeline of Orders
1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.
2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.
3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.
Post-Decision Procedures
The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.
• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.
• A rehearing may be granted for the following causes:
1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.
2. Misconduct by the Department, ALJ, or the prevailing party.
3. Accident or surprise that could not have been prevented by ordinary prudence.
4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.
5. Excessive or insufficient penalties.
6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.
7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.
8. The findings of fact or decision is not supported by the evidence or is contrary to law.
• Parties may appeal the final administrative action by filing a complaint for judicial review.
The Petitioner's petition was denied. The Administrative Law Judge concluded that Petitioner failed to meet the burden of proof showing Respondent restricted electronic access to the bank account, and the issue was moot since the bank closed the account. Respondent complied with the statutory requirement to make records reasonably available.
Why this result: Petitioner failed to meet the burden of proof; lack of evidence that Respondent restricted access; issue was moot due to account closure; Respondent complied with A.R.S. § 33-1805(A) by offering paper copies of documents.
Key Issues & Findings
Wrongful denial of electronic access to the bank account's electronic information
Petitioner alleged Respondent unilaterally restricted his access to online, view-only bank account information and refused to restore access by November 25, 2016, in violation of A.R.S. § 33-1805(A).
Orders: Petition denied.
Filing fee: $500.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Analytics Highlights
Topics: Records Access, HOA Records, Mootness, Burden of Proof
Additional Citations:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Video Overview
Audio Overview
Decision Documents
17F-H1716016-REL Decision – 546761.pdf
Uploaded 2025-10-09T03:31:08 (61.1 KB)
17F-H1716016-REL Decision – 552261.pdf
Uploaded 2025-10-09T03:31:08 (553.3 KB)
Briefing Doc – 17F-H1716016-REL
Administrative Hearing Briefing: Sellers vs. Grayhawk Community Association
Executive Summary
This document synthesizes the findings and rulings in the administrative case of John Sellers (Petitioner) versus the Grayhawk Community Association (Respondent), adjudicated by the Arizona Office of Administrative Hearings and finalized by the Department of Real Estate. The core of the dispute was the Petitioner’s claim that the Respondent unlawfully restricted his electronic, view-only access to a bank account in violation of Arizona Revised Statutes (A.R.S.) § 33-1805(A).
The Administrative Law Judge (ALJ) denied the petition, concluding that the Petitioner failed to meet his burden of proof. The evidence showed the Respondent initially provided the requested electronic access, which the Petitioner successfully used before changing the password. The Petitioner offered no evidence that the Respondent subsequently interfered with or restricted this access. Furthermore, the issue was rendered moot when the bank in question closed the account. The ALJ affirmed that the Respondent’s offer to provide paper records satisfied the statutory requirement to make records “reasonably available.” This decision was subsequently adopted as a Final Order by the Commissioner of the Department of Real Estate.
Case Overview
Details
Case Name
John Sellers, Petitioner, vs. Grayhawk Community Association, Respondent.
Case Numbers
Docket No. 17F-H1716016-REL; Case No. HO 17-16/016
Adjudicating Body
Arizona Office of Administrative Hearings
Administrative Law Judge
Suzanne Marwil
Hearing Date
February 16, 2017
ALJ Decision Date
February 21, 2017
Final Order Date
March 3, 2017
Final Order Issued By
Judy Lowe, Commissioner, Department of Real Estate
The Core Dispute
Petitioner’s Position
John Sellers alleged that after he requested and received view-only access to the Association’s Alliance Association Bank account, the Respondent unilaterally restricted that access. He claimed the Respondent’s failure to restore access by his deadline of the close of business on November 25, 2016, constituted a violation of A.R.S. § 33-1805(A), which governs a member’s right to examine association records. The petition, for which a $500 fee was paid, was specifically focused on this single issue.
Respondent’s Position
The Grayhawk Community Association argued that it had gone beyond its statutory obligations by arranging for the bank to create a new online password specifically for the Petitioner. They maintained that after providing this access, they did not interfere with or restrict it in any way. They contended that the Petitioner’s subsequent inability to access the account was due to unknown reasons. The Respondent noted that the bank closed the account on November 28, 2016, making any form of electronic access permanently unavailable and rendering the issue moot. They also offered to provide paper copies of the relevant bank records.
Chronology of Key Events
• October 18, 2016: Petitioner John Sellers requests, among other items, an electronic, read-only password for the Respondent’s Alliance Association Bank account.
• November 2, 2016: The Respondent notifies the Petitioner that such a password did not exist at the time of the request.
• November 16, 2016: After requesting the bank create a password, the Respondent forwards the new login information to the Petitioner.
• Post-November 16, 2016: The Petitioner successfully logs into the bank account using the provided information and changes the password.
• Thanksgiving Day (November 24, 2016): The Petitioner attempts to log in again but “could not see anything.” Based on the assumption that the Respondent had restricted his access, he emails community manager Michael Fee.
• Thanksgiving Day Demand: In his email, the Petitioner sets a deadline for the Respondent to restore his access by the end of the business day on Friday, November 25, 2016, threatening to file a petition if the deadline is not met. Mr. Fee replies that he will contact the bank.
• November 28, 2016: Having not heard further from the Respondent, the Petitioner files the petition in this matter.
• November 28, 2016: On the same day, the Respondent informs the Petitioner that they do not know the reason for the lack of access and denies that anyone affiliated with the association interfered. It is also on this date that Alliance Association Bank closes the account in question.
Analysis of the Administrative Law Judge’s Decision
The ALJ’s decision was based on a hearing held on February 16, 2017. The ruling systematically dismantled the Petitioner’s case based on the evidence presented.
Burden and Standard of Proof
• Pursuant to Arizona Administrative Code (A.A.C.) R2-19-119(B), the Petitioner held the burden of proof.
• The required standard of proof was a preponderance of the evidence, meaning the Petitioner had to show it was more likely than not that his claim was true.
Key Findings of Fact
1. Access Was Provided: It was undisputed that the Respondent provided the Petitioner with login information and that this information initially worked, enabling him to access the account.
2. Petitioner Changed Password: After gaining access, the Petitioner changed the password.
3. No Evidence of Interference: The Petitioner offered “no evidence that Respondent took any action to deny Petitioner online access.” His belief that access was restricted was a “unilateral assumption.” The record did not establish why the new password failed to work on Thanksgiving Day.
4. Issue Rendered Moot: The undisputed closure of the bank account by the bank on November 28, 2016, made the request for electronic access moot, as such access was no longer available to anyone.
Key Conclusions of Law
1. Failure to Meet Burden of Proof: The ALJ concluded that the “Petitioner has failed to meet his burden of proof.” The record was “devoid of any evidence” that the Respondent denied the requested information or took any action to restrict access.
2. Compliance with A.R.S. § 33-1805(A): The statute requires that association records “be made reasonably available for examination.” The ALJ found that the Respondent complied with the statute by initially providing electronic access and later offering to “furnish the Petitioner paper copies of documents it possessed related to that bank account.”
3. Electronic vs. Paper Access: The Petitioner’s argument that paper access is inferior to electronic access was dismissed as a “policy argument that should be addressed to the Legislature.” The plain language of the existing statute does not mandate a specific format for record examination.
Final Order and Outcome
On March 3, 2017, the Commissioner of the Department of Real Estate issued a Final Order, which fully adopted the ALJ’s decision.
• Petition Denied: The Commissioner accepted the ALJ’s decision that the petition be denied.
• Future Compliance Directive: The order stated, “The Commissioner accepts the Recommended Order that Respondent shall comply with the applicable provisions of Arizona Revised Statutes (‘A.R.S.’) § 33-1804 (A) in the future.”
• Binding Decision: The order became a final administrative action, effective immediately and binding on the parties.
• Rehearing and Appeal Process: Parties were notified that a motion for rehearing or review could be filed within 30 days. A request for rehearing should be addressed to Abby Hansen, 2910 N. 44th Street, Suite 100, Phoenix, Arizona, 85018. The order could also be appealed via a complaint for judicial review.
Study Guide – 17F-H1716016-REL
Study Guide: Sellers v. Grayhawk Community Association
This guide provides a comprehensive review of the administrative legal case No. 17F-H1716016-REL, John Sellers v. Grayhawk Community Association, based on the Administrative Law Judge Decision and the subsequent Final Order from the Department of Real Estate.
Short-Answer Quiz
Answer the following questions in two to three sentences, based on the information provided in the case documents.
1. Identify the primary parties involved in this case and state their respective roles.
2. What was the central accusation made by the Petitioner against the Respondent?
3. According to the Respondent’s argument, what actions did it take in response to the Petitioner’s initial request for electronic bank records?
4. What specific event occurred on Thanksgiving Day that directly prompted the Petitioner to file his petition?
5. What was the required standard of proof in this hearing, and which party was assigned the burden of meeting it?
6. Which specific Arizona Revised Statute (A.R.S.) did the Petitioner allege the Respondent had violated?
7. Summarize the primary reason the Administrative Law Judge found that the Petitioner failed to meet his burden of proof.
8. Why did the Administrative Law Judge determine that the issue of electronic access had become moot?
9. What was the final decision issued by the Administrative Law Judge, and was it accepted by the Commissioner of the Department of Real Estate?
10. How did the Administrative Law Judge address the Petitioner’s argument that paper records are an inferior substitute for electronic access?
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Answer Key
1. The primary parties were John Sellers, who served as the Petitioner, and the Grayhawk Community Association, which was the Respondent. The Petitioner, Mr. Sellers, brought the complaint, and the Respondent, Grayhawk Community Association, was the party accused of wrongdoing.
2. The Petitioner accused the Respondent of violating A.R.S. § 33-1805(A) by unilaterally restricting his online, view-only access to a bank account. He claimed they wrongfully denied him this access and failed to restore it by his deadline of November 25, 2016.
3. The Respondent argued it went beyond its statutory obligation by requesting that Alliance Association Bank create an online, view-only password specifically for the Petitioner, as one did not previously exist. The Respondent then forwarded this new login information to the Petitioner on November 16, 2016.
4. On Thanksgiving Day, the Petitioner attempted to log on to the bank account but could not see anything. Based on the assumption that the Respondent had restricted his access, he emailed the community manager and set a deadline for the next business day, which ultimately led to him filing the petition when access was not restored.
5. The standard of proof required was a “preponderance of the evidence.” Pursuant to A.A.C. R2-19-119(B), the Petitioner, John Sellers, had the burden of proof in this matter.
6. The Petitioner alleged that the Respondent had violated A.R.S. § 33-1805(A). This statute requires that all financial and other records of an association be made reasonably available for examination by any member.
7. The Judge found that the Petitioner offered no proof that the Respondent took any action to restrict or interfere with his access to the bank account. The record showed the Respondent provided the initial access, and it was not established why the Petitioner’s new password later failed to work.
8. The issue of electronic access was deemed moot for two reasons. First, the bank closed the account in question on November 28, 2016, making electronic access impossible. Second, the Respondent had offered to furnish the Petitioner with paper copies of the documents it possessed related to that account.
9. The Administrative Law Judge ordered that the Petitioner’s petition be denied. The Commissioner of the Department of Real Estate accepted this recommended decision and issued a Final Order denying the petition.
10. The Judge characterized the Petitioner’s argument as a policy argument that should be addressed to the Legislature, not the court. The Judge stated that the plain language of the statute only requires records to be made “reasonably available,” and concluded the Respondent complied with the law by offering paper copies.
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Essay Questions
Construct detailed, essay-format responses to the following prompts. Do not provide answers.
1. Analyze the timeline of events from October 18, 2016, to November 28, 2016. How did the Petitioner’s actions, particularly his assumptions and deadlines, impact the outcome of the case as determined by the Administrative Law Judge?
2. Discuss the concept of “burden of proof” as it applies to this case. Explain why the Petitioner, John Sellers, failed to meet the standard of “preponderance of the evidence” according to the Administrative Law Judge’s findings.
3. Examine the Administrative Law Judge’s interpretation of A.R.S. § 33-1805(A). How does the judge’s distinction between “reasonably available” records and the specific format of access (electronic vs. paper) form the core of the legal conclusion?
4. The Respondent argued it went “beyond its statutory obligation.” Based on the facts presented in the decision, construct an argument either supporting or refuting this claim.
5. Explain the concept of “mootness” in the context of this legal dispute. How did the closure of the Alliance Association Bank account on November 28, 2016, render the central issue of the petition moot?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
A judge who presides over hearings at an administrative agency. In this case, Suzanne Marwil presided for the Office of Administrative Hearings.
A.A.C.
An abbreviation for the Arizona Administrative Code, which is the official compilation of rules and regulations of Arizona state agencies.
A.R.S.
An abbreviation for Arizona Revised Statutes, which is the codified collection of laws passed by the Arizona state legislature.
Burden of Proof
The legal obligation of a party in a proceeding to provide sufficient evidence to prove their claim. In this matter, the burden of proof was on the Petitioner.
Conclusions of Law
The section of a legal decision where the judge applies legal principles and statutes to the established facts of the case to reach a ruling.
Final Order
An official, binding decision issued by an administrative body that resolves a legal dispute. In this case, the Commissioner of the Department of Real Estate issued the Final Order adopting the ALJ’s decision.
Findings of Fact
The section of a legal decision that details the facts of the case as determined by the judge based on the evidence presented during the hearing.
A legal term describing an issue that is no longer in dispute or has become irrelevant due to changed circumstances, making a judicial decision unnecessary. The account’s closure made the access issue moot.
A formal, written direction from a judge or administrative body. The ALJ issued an Order denying the petition.
Petitioner
The party who initiates a legal action by filing a petition. In this case, John Sellers.
Preponderance of the Evidence
The standard of proof required in this administrative hearing. It means that the evidence must demonstrate that a claim is more likely to be true than not true.
Respondent
The party against whom a petition is filed and who is required to respond to the claims. In this case, the Grayhawk Community Association.
Blog Post – 17F-H1716016-REL
How a Thanksgiving Day Login Failure Cost a Homeowner $500: Key Lessons from a Bizarre HOA Dispute
Almost everyone knows the modern frustration of a forgotten password or a website that simply won’t cooperate. But in a peculiar 2017 case, a homeowner’s inability to access a bank account online on Thanksgiving Day escalated from a simple tech issue into a formal legal petition against his Homeowners Association (HOA). The official court ruling offers a case study in failed conflict resolution, with surprising and critical lessons for any homeowner navigating the complex world of community association governance.
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1. An Unproven Assumption Can Be a Costly Mistake
The entire legal dispute was triggered by a critical strategic miscalculation based on an unverified assumption. The sequence of events began when petitioner John Sellers, after having previously changed the password himself, logged in to his HOA’s bank account on Thanksgiving Day and “could not see anything.”
Instead of exploring technical explanations, like a server issue over the holiday, he “unilaterally assumed” that the HOA (the Respondent, Grayhawk Community Association) had intentionally restricted his access. Acting immediately on this assumption, he emailed the community manager, Michael Fee, setting an aggressive deadline for the end of business the following day to have his access restored. When that deadline passed, he filed a formal petition. Crucially, the record notes the petitioner paid a $500.00 fee to file it.
However, the petitioner’s narrative omits a key fact: the community manager was not unresponsive. The case file shows that “Mr. Fee advised he would contact the bank.” This detail reveals the petitioner’s precipitous rush to litigation, bypassing any opportunity for simple clarification. The judge’s finding was decisive, underscoring this failure in de-escalation: the petitioner “offered no evidence that Respondent took any action to deny Petitioner online access to the account.” Acting on a costly assumption led directly to a lost case and a forfeited $500 fee.
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2. The Law Requires “Reasonable Access,” Not Your Preferred Method
The petitioner’s central legal argument was that he was wrongfully denied electronic access to the bank’s information. This complaint, however, was fundamentally misaligned with the plain language of the governing statute.
The relevant law, A.R.S. § 33-1805(A), states that “all financial and other records of the association shall be made reasonably available for examination by any member.” The Administrative Law Judge found that the HOA had fully complied with this duty. When the login issue persisted and the account was later closed by the bank, the Respondent “offered to furnish the Petitioner paper copies of documents it possessed related to that bank account.” This distinction is legally significant; the law does not mandate a specific method of access—especially a preferred or more convenient one—only that the access provided be “reasonable.”
The judge’s decision explicitly rejected the petitioner’s policy argument:
Petitioner’s argument that paper access to the account information is inferior to electronic access constitutes a policy argument that should be addressed to the Legislature. The plain language of the statute requires only that records of Respondent be made reasonable available for Petitioner’s examination. Respondent complied with the statute.
This highlights an important takeaway for all homeowners: understanding the difference between what is legally required versus what is simply convenient can prevent unnecessary and unwinnable disputes.
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3. Even “Going the Extra Mile” Can Lead to a Lawsuit
One of the most ironic details of the case is that the HOA was never obligated to provide online access in the first place. According to the case file, when the petitioner first requested electronic access on October 18, 2016, “such a password did not exist.”
In its defense, the HOA argued—and the facts seem to support—that it went “beyond its statutory obligation” by requesting that its bank create a special view-only password specifically for the petitioner. This was a proactive accommodation, not a statutory duty.
This situation reveals a paradox often seen in community management, where proactive efforts to accommodate a resident can inadvertently create new avenues for conflict. The very courtesy the HOA extended—creating an online access portal that wasn’t legally required—became the foundation of the legal petition filed against them, illustrating the complex and often thankless nature of community governance.
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4. The Burden of Proof Is on the Accuser
In any formal legal dispute, the question of who must prove their case is critical. According to the case file, the “Petitioner has the burden of proof in this matter.” The legal standard he had to meet was a “preponderance of the evidence,” which is the standard of proof required in most civil, non-criminal matters.
In simple terms, this means John Sellers had the responsibility to prove that it was more likely than not that the Grayhawk Community Association actively and intentionally restricted his access. He failed to provide any such proof.
The judge’s conclusion on this point was unambiguous: “Petitioner offered no proof that the Respondent restricted his access to the account in any way.” His case failed because it was built entirely on an assumption, with no evidence to support the accusation. This serves as a fundamental lesson in legal disputes: an accusation alone is not enough; it must be backed by credible evidence to prevail.
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Conclusion: A Final Thought Before You Escalate
A simple holiday login error became a failed legal petition due to a cascade of unverified assumptions and a fundamental misunderstanding of statutory requirements. This strange case serves as a potent reminder for homeowners and board members alike about the risks of escalating a grievance without first establishing the facts and understanding the law.
Before launching a formal, and potentially costly, complaint, it’s worth asking two simple questions: What does the law actually require, and what can I definitively prove?
Case Participants
Petitioner Side
John Sellers(petitioner)
Respondent Side
Curtis Ekmark(HOA attorney) Grayhawk Community Association
Michael Fee(community manager) Grayhawk Community Association
Neutral Parties
Suzanne Marwil(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
The Petitioner's petition was denied. The Administrative Law Judge concluded that Petitioner failed to meet the burden of proof showing Respondent restricted electronic access to the bank account, and the issue was moot since the bank closed the account. Respondent complied with the statutory requirement to make records reasonably available.
Why this result: Petitioner failed to meet the burden of proof; lack of evidence that Respondent restricted access; issue was moot due to account closure; Respondent complied with A.R.S. § 33-1805(A) by offering paper copies of documents.
Key Issues & Findings
Wrongful denial of electronic access to the bank account's electronic information
Petitioner alleged Respondent unilaterally restricted his access to online, view-only bank account information and refused to restore access by November 25, 2016, in violation of A.R.S. § 33-1805(A).
Orders: Petition denied.
Filing fee: $500.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Analytics Highlights
Topics: Records Access, HOA Records, Mootness, Burden of Proof
Additional Citations:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Video Overview
Audio Overview
Decision Documents
17F-H1716016-REL Decision – 546761.pdf
Uploaded 2026-01-23T17:18:32 (61.1 KB)
17F-H1716016-REL Decision – 552261.pdf
Uploaded 2026-01-23T17:18:37 (553.3 KB)
Briefing Doc – 17F-H1716016-REL
Administrative Hearing Briefing: Sellers vs. Grayhawk Community Association
Executive Summary
This document synthesizes the findings and rulings in the administrative case of John Sellers (Petitioner) versus the Grayhawk Community Association (Respondent), adjudicated by the Arizona Office of Administrative Hearings and finalized by the Department of Real Estate. The core of the dispute was the Petitioner’s claim that the Respondent unlawfully restricted his electronic, view-only access to a bank account in violation of Arizona Revised Statutes (A.R.S.) § 33-1805(A).
The Administrative Law Judge (ALJ) denied the petition, concluding that the Petitioner failed to meet his burden of proof. The evidence showed the Respondent initially provided the requested electronic access, which the Petitioner successfully used before changing the password. The Petitioner offered no evidence that the Respondent subsequently interfered with or restricted this access. Furthermore, the issue was rendered moot when the bank in question closed the account. The ALJ affirmed that the Respondent’s offer to provide paper records satisfied the statutory requirement to make records “reasonably available.” This decision was subsequently adopted as a Final Order by the Commissioner of the Department of Real Estate.
Case Overview
Details
Case Name
John Sellers, Petitioner, vs. Grayhawk Community Association, Respondent.
Case Numbers
Docket No. 17F-H1716016-REL; Case No. HO 17-16/016
Adjudicating Body
Arizona Office of Administrative Hearings
Administrative Law Judge
Suzanne Marwil
Hearing Date
February 16, 2017
ALJ Decision Date
February 21, 2017
Final Order Date
March 3, 2017
Final Order Issued By
Judy Lowe, Commissioner, Department of Real Estate
The Core Dispute
Petitioner’s Position
John Sellers alleged that after he requested and received view-only access to the Association’s Alliance Association Bank account, the Respondent unilaterally restricted that access. He claimed the Respondent’s failure to restore access by his deadline of the close of business on November 25, 2016, constituted a violation of A.R.S. § 33-1805(A), which governs a member’s right to examine association records. The petition, for which a $500 fee was paid, was specifically focused on this single issue.
Respondent’s Position
The Grayhawk Community Association argued that it had gone beyond its statutory obligations by arranging for the bank to create a new online password specifically for the Petitioner. They maintained that after providing this access, they did not interfere with or restrict it in any way. They contended that the Petitioner’s subsequent inability to access the account was due to unknown reasons. The Respondent noted that the bank closed the account on November 28, 2016, making any form of electronic access permanently unavailable and rendering the issue moot. They also offered to provide paper copies of the relevant bank records.
Chronology of Key Events
• October 18, 2016: Petitioner John Sellers requests, among other items, an electronic, read-only password for the Respondent’s Alliance Association Bank account.
• November 2, 2016: The Respondent notifies the Petitioner that such a password did not exist at the time of the request.
• November 16, 2016: After requesting the bank create a password, the Respondent forwards the new login information to the Petitioner.
• Post-November 16, 2016: The Petitioner successfully logs into the bank account using the provided information and changes the password.
• Thanksgiving Day (November 24, 2016): The Petitioner attempts to log in again but “could not see anything.” Based on the assumption that the Respondent had restricted his access, he emails community manager Michael Fee.
• Thanksgiving Day Demand: In his email, the Petitioner sets a deadline for the Respondent to restore his access by the end of the business day on Friday, November 25, 2016, threatening to file a petition if the deadline is not met. Mr. Fee replies that he will contact the bank.
• November 28, 2016: Having not heard further from the Respondent, the Petitioner files the petition in this matter.
• November 28, 2016: On the same day, the Respondent informs the Petitioner that they do not know the reason for the lack of access and denies that anyone affiliated with the association interfered. It is also on this date that Alliance Association Bank closes the account in question.
Analysis of the Administrative Law Judge’s Decision
The ALJ’s decision was based on a hearing held on February 16, 2017. The ruling systematically dismantled the Petitioner’s case based on the evidence presented.
Burden and Standard of Proof
• Pursuant to Arizona Administrative Code (A.A.C.) R2-19-119(B), the Petitioner held the burden of proof.
• The required standard of proof was a preponderance of the evidence, meaning the Petitioner had to show it was more likely than not that his claim was true.
Key Findings of Fact
1. Access Was Provided: It was undisputed that the Respondent provided the Petitioner with login information and that this information initially worked, enabling him to access the account.
2. Petitioner Changed Password: After gaining access, the Petitioner changed the password.
3. No Evidence of Interference: The Petitioner offered “no evidence that Respondent took any action to deny Petitioner online access.” His belief that access was restricted was a “unilateral assumption.” The record did not establish why the new password failed to work on Thanksgiving Day.
4. Issue Rendered Moot: The undisputed closure of the bank account by the bank on November 28, 2016, made the request for electronic access moot, as such access was no longer available to anyone.
Key Conclusions of Law
1. Failure to Meet Burden of Proof: The ALJ concluded that the “Petitioner has failed to meet his burden of proof.” The record was “devoid of any evidence” that the Respondent denied the requested information or took any action to restrict access.
2. Compliance with A.R.S. § 33-1805(A): The statute requires that association records “be made reasonably available for examination.” The ALJ found that the Respondent complied with the statute by initially providing electronic access and later offering to “furnish the Petitioner paper copies of documents it possessed related to that bank account.”
3. Electronic vs. Paper Access: The Petitioner’s argument that paper access is inferior to electronic access was dismissed as a “policy argument that should be addressed to the Legislature.” The plain language of the existing statute does not mandate a specific format for record examination.
Final Order and Outcome
On March 3, 2017, the Commissioner of the Department of Real Estate issued a Final Order, which fully adopted the ALJ’s decision.
• Petition Denied: The Commissioner accepted the ALJ’s decision that the petition be denied.
• Future Compliance Directive: The order stated, “The Commissioner accepts the Recommended Order that Respondent shall comply with the applicable provisions of Arizona Revised Statutes (‘A.R.S.’) § 33-1804 (A) in the future.”
• Binding Decision: The order became a final administrative action, effective immediately and binding on the parties.
• Rehearing and Appeal Process: Parties were notified that a motion for rehearing or review could be filed within 30 days. A request for rehearing should be addressed to Abby Hansen, 2910 N. 44th Street, Suite 100, Phoenix, Arizona, 85018. The order could also be appealed via a complaint for judicial review.
Study Guide – 17F-H1716016-REL
Study Guide: Sellers v. Grayhawk Community Association
This guide provides a comprehensive review of the administrative legal case No. 17F-H1716016-REL, John Sellers v. Grayhawk Community Association, based on the Administrative Law Judge Decision and the subsequent Final Order from the Department of Real Estate.
Short-Answer Quiz
Answer the following questions in two to three sentences, based on the information provided in the case documents.
1. Identify the primary parties involved in this case and state their respective roles.
2. What was the central accusation made by the Petitioner against the Respondent?
3. According to the Respondent’s argument, what actions did it take in response to the Petitioner’s initial request for electronic bank records?
4. What specific event occurred on Thanksgiving Day that directly prompted the Petitioner to file his petition?
5. What was the required standard of proof in this hearing, and which party was assigned the burden of meeting it?
6. Which specific Arizona Revised Statute (A.R.S.) did the Petitioner allege the Respondent had violated?
7. Summarize the primary reason the Administrative Law Judge found that the Petitioner failed to meet his burden of proof.
8. Why did the Administrative Law Judge determine that the issue of electronic access had become moot?
9. What was the final decision issued by the Administrative Law Judge, and was it accepted by the Commissioner of the Department of Real Estate?
10. How did the Administrative Law Judge address the Petitioner’s argument that paper records are an inferior substitute for electronic access?
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Answer Key
1. The primary parties were John Sellers, who served as the Petitioner, and the Grayhawk Community Association, which was the Respondent. The Petitioner, Mr. Sellers, brought the complaint, and the Respondent, Grayhawk Community Association, was the party accused of wrongdoing.
2. The Petitioner accused the Respondent of violating A.R.S. § 33-1805(A) by unilaterally restricting his online, view-only access to a bank account. He claimed they wrongfully denied him this access and failed to restore it by his deadline of November 25, 2016.
3. The Respondent argued it went beyond its statutory obligation by requesting that Alliance Association Bank create an online, view-only password specifically for the Petitioner, as one did not previously exist. The Respondent then forwarded this new login information to the Petitioner on November 16, 2016.
4. On Thanksgiving Day, the Petitioner attempted to log on to the bank account but could not see anything. Based on the assumption that the Respondent had restricted his access, he emailed the community manager and set a deadline for the next business day, which ultimately led to him filing the petition when access was not restored.
5. The standard of proof required was a “preponderance of the evidence.” Pursuant to A.A.C. R2-19-119(B), the Petitioner, John Sellers, had the burden of proof in this matter.
6. The Petitioner alleged that the Respondent had violated A.R.S. § 33-1805(A). This statute requires that all financial and other records of an association be made reasonably available for examination by any member.
7. The Judge found that the Petitioner offered no proof that the Respondent took any action to restrict or interfere with his access to the bank account. The record showed the Respondent provided the initial access, and it was not established why the Petitioner’s new password later failed to work.
8. The issue of electronic access was deemed moot for two reasons. First, the bank closed the account in question on November 28, 2016, making electronic access impossible. Second, the Respondent had offered to furnish the Petitioner with paper copies of the documents it possessed related to that account.
9. The Administrative Law Judge ordered that the Petitioner’s petition be denied. The Commissioner of the Department of Real Estate accepted this recommended decision and issued a Final Order denying the petition.
10. The Judge characterized the Petitioner’s argument as a policy argument that should be addressed to the Legislature, not the court. The Judge stated that the plain language of the statute only requires records to be made “reasonably available,” and concluded the Respondent complied with the law by offering paper copies.
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Essay Questions
Construct detailed, essay-format responses to the following prompts. Do not provide answers.
1. Analyze the timeline of events from October 18, 2016, to November 28, 2016. How did the Petitioner’s actions, particularly his assumptions and deadlines, impact the outcome of the case as determined by the Administrative Law Judge?
2. Discuss the concept of “burden of proof” as it applies to this case. Explain why the Petitioner, John Sellers, failed to meet the standard of “preponderance of the evidence” according to the Administrative Law Judge’s findings.
3. Examine the Administrative Law Judge’s interpretation of A.R.S. § 33-1805(A). How does the judge’s distinction between “reasonably available” records and the specific format of access (electronic vs. paper) form the core of the legal conclusion?
4. The Respondent argued it went “beyond its statutory obligation.” Based on the facts presented in the decision, construct an argument either supporting or refuting this claim.
5. Explain the concept of “mootness” in the context of this legal dispute. How did the closure of the Alliance Association Bank account on November 28, 2016, render the central issue of the petition moot?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
A judge who presides over hearings at an administrative agency. In this case, Suzanne Marwil presided for the Office of Administrative Hearings.
A.A.C.
An abbreviation for the Arizona Administrative Code, which is the official compilation of rules and regulations of Arizona state agencies.
A.R.S.
An abbreviation for Arizona Revised Statutes, which is the codified collection of laws passed by the Arizona state legislature.
Burden of Proof
The legal obligation of a party in a proceeding to provide sufficient evidence to prove their claim. In this matter, the burden of proof was on the Petitioner.
Conclusions of Law
The section of a legal decision where the judge applies legal principles and statutes to the established facts of the case to reach a ruling.
Final Order
An official, binding decision issued by an administrative body that resolves a legal dispute. In this case, the Commissioner of the Department of Real Estate issued the Final Order adopting the ALJ’s decision.
Findings of Fact
The section of a legal decision that details the facts of the case as determined by the judge based on the evidence presented during the hearing.
A legal term describing an issue that is no longer in dispute or has become irrelevant due to changed circumstances, making a judicial decision unnecessary. The account’s closure made the access issue moot.
A formal, written direction from a judge or administrative body. The ALJ issued an Order denying the petition.
Petitioner
The party who initiates a legal action by filing a petition. In this case, John Sellers.
Preponderance of the Evidence
The standard of proof required in this administrative hearing. It means that the evidence must demonstrate that a claim is more likely to be true than not true.
Respondent
The party against whom a petition is filed and who is required to respond to the claims. In this case, the Grayhawk Community Association.
Blog Post – 17F-H1716016-REL
How a Thanksgiving Day Login Failure Cost a Homeowner $500: Key Lessons from a Bizarre HOA Dispute
Almost everyone knows the modern frustration of a forgotten password or a website that simply won’t cooperate. But in a peculiar 2017 case, a homeowner’s inability to access a bank account online on Thanksgiving Day escalated from a simple tech issue into a formal legal petition against his Homeowners Association (HOA). The official court ruling offers a case study in failed conflict resolution, with surprising and critical lessons for any homeowner navigating the complex world of community association governance.
——————————————————————————–
1. An Unproven Assumption Can Be a Costly Mistake
The entire legal dispute was triggered by a critical strategic miscalculation based on an unverified assumption. The sequence of events began when petitioner John Sellers, after having previously changed the password himself, logged in to his HOA’s bank account on Thanksgiving Day and “could not see anything.”
Instead of exploring technical explanations, like a server issue over the holiday, he “unilaterally assumed” that the HOA (the Respondent, Grayhawk Community Association) had intentionally restricted his access. Acting immediately on this assumption, he emailed the community manager, Michael Fee, setting an aggressive deadline for the end of business the following day to have his access restored. When that deadline passed, he filed a formal petition. Crucially, the record notes the petitioner paid a $500.00 fee to file it.
However, the petitioner’s narrative omits a key fact: the community manager was not unresponsive. The case file shows that “Mr. Fee advised he would contact the bank.” This detail reveals the petitioner’s precipitous rush to litigation, bypassing any opportunity for simple clarification. The judge’s finding was decisive, underscoring this failure in de-escalation: the petitioner “offered no evidence that Respondent took any action to deny Petitioner online access to the account.” Acting on a costly assumption led directly to a lost case and a forfeited $500 fee.
——————————————————————————–
2. The Law Requires “Reasonable Access,” Not Your Preferred Method
The petitioner’s central legal argument was that he was wrongfully denied electronic access to the bank’s information. This complaint, however, was fundamentally misaligned with the plain language of the governing statute.
The relevant law, A.R.S. § 33-1805(A), states that “all financial and other records of the association shall be made reasonably available for examination by any member.” The Administrative Law Judge found that the HOA had fully complied with this duty. When the login issue persisted and the account was later closed by the bank, the Respondent “offered to furnish the Petitioner paper copies of documents it possessed related to that bank account.” This distinction is legally significant; the law does not mandate a specific method of access—especially a preferred or more convenient one—only that the access provided be “reasonable.”
The judge’s decision explicitly rejected the petitioner’s policy argument:
Petitioner’s argument that paper access to the account information is inferior to electronic access constitutes a policy argument that should be addressed to the Legislature. The plain language of the statute requires only that records of Respondent be made reasonable available for Petitioner’s examination. Respondent complied with the statute.
This highlights an important takeaway for all homeowners: understanding the difference between what is legally required versus what is simply convenient can prevent unnecessary and unwinnable disputes.
——————————————————————————–
3. Even “Going the Extra Mile” Can Lead to a Lawsuit
One of the most ironic details of the case is that the HOA was never obligated to provide online access in the first place. According to the case file, when the petitioner first requested electronic access on October 18, 2016, “such a password did not exist.”
In its defense, the HOA argued—and the facts seem to support—that it went “beyond its statutory obligation” by requesting that its bank create a special view-only password specifically for the petitioner. This was a proactive accommodation, not a statutory duty.
This situation reveals a paradox often seen in community management, where proactive efforts to accommodate a resident can inadvertently create new avenues for conflict. The very courtesy the HOA extended—creating an online access portal that wasn’t legally required—became the foundation of the legal petition filed against them, illustrating the complex and often thankless nature of community governance.
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4. The Burden of Proof Is on the Accuser
In any formal legal dispute, the question of who must prove their case is critical. According to the case file, the “Petitioner has the burden of proof in this matter.” The legal standard he had to meet was a “preponderance of the evidence,” which is the standard of proof required in most civil, non-criminal matters.
In simple terms, this means John Sellers had the responsibility to prove that it was more likely than not that the Grayhawk Community Association actively and intentionally restricted his access. He failed to provide any such proof.
The judge’s conclusion on this point was unambiguous: “Petitioner offered no proof that the Respondent restricted his access to the account in any way.” His case failed because it was built entirely on an assumption, with no evidence to support the accusation. This serves as a fundamental lesson in legal disputes: an accusation alone is not enough; it must be backed by credible evidence to prevail.
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Conclusion: A Final Thought Before You Escalate
A simple holiday login error became a failed legal petition due to a cascade of unverified assumptions and a fundamental misunderstanding of statutory requirements. This strange case serves as a potent reminder for homeowners and board members alike about the risks of escalating a grievance without first establishing the facts and understanding the law.
Before launching a formal, and potentially costly, complaint, it’s worth asking two simple questions: What does the law actually require, and what can I definitively prove?
Case Participants
Petitioner Side
John Sellers(petitioner)
Respondent Side
Curtis Ekmark(HOA attorney) Grayhawk Community Association
Michael Fee(community manager) Grayhawk Community Association
Neutral Parties
Suzanne Marwil(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
The Petitioner's petition was denied. The Administrative Law Judge concluded that Petitioner failed to meet the burden of proof showing Respondent restricted electronic access to the bank account, and the issue was moot since the bank closed the account. Respondent complied with the statutory requirement to make records reasonably available.
Why this result: Petitioner failed to meet the burden of proof; lack of evidence that Respondent restricted access; issue was moot due to account closure; Respondent complied with A.R.S. § 33-1805(A) by offering paper copies of documents.
Key Issues & Findings
Wrongful denial of electronic access to the bank account's electronic information
Petitioner alleged Respondent unilaterally restricted his access to online, view-only bank account information and refused to restore access by November 25, 2016, in violation of A.R.S. § 33-1805(A).
Orders: Petition denied.
Filing fee: $500.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Analytics Highlights
Topics: Records Access, HOA Records, Mootness, Burden of Proof
Additional Citations:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Audio Overview
Decision Documents
17F-H1716016-REL Decision – 546761.pdf
Uploaded 2025-10-08T06:57:02 (61.1 KB)
17F-H1716016-REL Decision – 552261.pdf
Uploaded 2025-10-08T06:57:03 (553.3 KB)
Briefing Doc – 17F-H1716016-REL
Administrative Hearing Briefing: Sellers vs. Grayhawk Community Association
Executive Summary
This document synthesizes the findings and rulings in the administrative case of John Sellers (Petitioner) versus the Grayhawk Community Association (Respondent), adjudicated by the Arizona Office of Administrative Hearings and finalized by the Department of Real Estate. The core of the dispute was the Petitioner’s claim that the Respondent unlawfully restricted his electronic, view-only access to a bank account in violation of Arizona Revised Statutes (A.R.S.) § 33-1805(A).
The Administrative Law Judge (ALJ) denied the petition, concluding that the Petitioner failed to meet his burden of proof. The evidence showed the Respondent initially provided the requested electronic access, which the Petitioner successfully used before changing the password. The Petitioner offered no evidence that the Respondent subsequently interfered with or restricted this access. Furthermore, the issue was rendered moot when the bank in question closed the account. The ALJ affirmed that the Respondent’s offer to provide paper records satisfied the statutory requirement to make records “reasonably available.” This decision was subsequently adopted as a Final Order by the Commissioner of the Department of Real Estate.
Case Overview
Details
Case Name
John Sellers, Petitioner, vs. Grayhawk Community Association, Respondent.
Case Numbers
Docket No. 17F-H1716016-REL; Case No. HO 17-16/016
Adjudicating Body
Arizona Office of Administrative Hearings
Administrative Law Judge
Suzanne Marwil
Hearing Date
February 16, 2017
ALJ Decision Date
February 21, 2017
Final Order Date
March 3, 2017
Final Order Issued By
Judy Lowe, Commissioner, Department of Real Estate
The Core Dispute
Petitioner’s Position
John Sellers alleged that after he requested and received view-only access to the Association’s Alliance Association Bank account, the Respondent unilaterally restricted that access. He claimed the Respondent’s failure to restore access by his deadline of the close of business on November 25, 2016, constituted a violation of A.R.S. § 33-1805(A), which governs a member’s right to examine association records. The petition, for which a $500 fee was paid, was specifically focused on this single issue.
Respondent’s Position
The Grayhawk Community Association argued that it had gone beyond its statutory obligations by arranging for the bank to create a new online password specifically for the Petitioner. They maintained that after providing this access, they did not interfere with or restrict it in any way. They contended that the Petitioner’s subsequent inability to access the account was due to unknown reasons. The Respondent noted that the bank closed the account on November 28, 2016, making any form of electronic access permanently unavailable and rendering the issue moot. They also offered to provide paper copies of the relevant bank records.
Chronology of Key Events
• October 18, 2016: Petitioner John Sellers requests, among other items, an electronic, read-only password for the Respondent’s Alliance Association Bank account.
• November 2, 2016: The Respondent notifies the Petitioner that such a password did not exist at the time of the request.
• November 16, 2016: After requesting the bank create a password, the Respondent forwards the new login information to the Petitioner.
• Post-November 16, 2016: The Petitioner successfully logs into the bank account using the provided information and changes the password.
• Thanksgiving Day (November 24, 2016): The Petitioner attempts to log in again but “could not see anything.” Based on the assumption that the Respondent had restricted his access, he emails community manager Michael Fee.
• Thanksgiving Day Demand: In his email, the Petitioner sets a deadline for the Respondent to restore his access by the end of the business day on Friday, November 25, 2016, threatening to file a petition if the deadline is not met. Mr. Fee replies that he will contact the bank.
• November 28, 2016: Having not heard further from the Respondent, the Petitioner files the petition in this matter.
• November 28, 2016: On the same day, the Respondent informs the Petitioner that they do not know the reason for the lack of access and denies that anyone affiliated with the association interfered. It is also on this date that Alliance Association Bank closes the account in question.
Analysis of the Administrative Law Judge’s Decision
The ALJ’s decision was based on a hearing held on February 16, 2017. The ruling systematically dismantled the Petitioner’s case based on the evidence presented.
Burden and Standard of Proof
• Pursuant to Arizona Administrative Code (A.A.C.) R2-19-119(B), the Petitioner held the burden of proof.
• The required standard of proof was a preponderance of the evidence, meaning the Petitioner had to show it was more likely than not that his claim was true.
Key Findings of Fact
1. Access Was Provided: It was undisputed that the Respondent provided the Petitioner with login information and that this information initially worked, enabling him to access the account.
2. Petitioner Changed Password: After gaining access, the Petitioner changed the password.
3. No Evidence of Interference: The Petitioner offered “no evidence that Respondent took any action to deny Petitioner online access.” His belief that access was restricted was a “unilateral assumption.” The record did not establish why the new password failed to work on Thanksgiving Day.
4. Issue Rendered Moot: The undisputed closure of the bank account by the bank on November 28, 2016, made the request for electronic access moot, as such access was no longer available to anyone.
Key Conclusions of Law
1. Failure to Meet Burden of Proof: The ALJ concluded that the “Petitioner has failed to meet his burden of proof.” The record was “devoid of any evidence” that the Respondent denied the requested information or took any action to restrict access.
2. Compliance with A.R.S. § 33-1805(A): The statute requires that association records “be made reasonably available for examination.” The ALJ found that the Respondent complied with the statute by initially providing electronic access and later offering to “furnish the Petitioner paper copies of documents it possessed related to that bank account.”
3. Electronic vs. Paper Access: The Petitioner’s argument that paper access is inferior to electronic access was dismissed as a “policy argument that should be addressed to the Legislature.” The plain language of the existing statute does not mandate a specific format for record examination.
Final Order and Outcome
On March 3, 2017, the Commissioner of the Department of Real Estate issued a Final Order, which fully adopted the ALJ’s decision.
• Petition Denied: The Commissioner accepted the ALJ’s decision that the petition be denied.
• Future Compliance Directive: The order stated, “The Commissioner accepts the Recommended Order that Respondent shall comply with the applicable provisions of Arizona Revised Statutes (‘A.R.S.’) § 33-1804 (A) in the future.”
• Binding Decision: The order became a final administrative action, effective immediately and binding on the parties.
• Rehearing and Appeal Process: Parties were notified that a motion for rehearing or review could be filed within 30 days. A request for rehearing should be addressed to Abby Hansen, 2910 N. 44th Street, Suite 100, Phoenix, Arizona, 85018. The order could also be appealed via a complaint for judicial review.
The Petitioner's petition was denied. The Administrative Law Judge concluded that Petitioner failed to meet the burden of proof showing Respondent restricted electronic access to the bank account, and the issue was moot since the bank closed the account. Respondent complied with the statutory requirement to make records reasonably available.
Why this result: Petitioner failed to meet the burden of proof; lack of evidence that Respondent restricted access; issue was moot due to account closure; Respondent complied with A.R.S. § 33-1805(A) by offering paper copies of documents.
Key Issues & Findings
Wrongful denial of electronic access to the bank account's electronic information
Petitioner alleged Respondent unilaterally restricted his access to online, view-only bank account information and refused to restore access by November 25, 2016, in violation of A.R.S. § 33-1805(A).
Orders: Petition denied.
Filing fee: $500.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Analytics Highlights
Topics: Records Access, HOA Records, Mootness, Burden of Proof
Additional Citations:
A.R.S. § 33-1805(A)
A.R.S. § 32-2199 et seq.
A.R.S. §§ 32-2199.01(D)
32-2199.02
A.A.C. R2-19-119(B)
A.A.C. R2-19-119(A)
Audio Overview
Decision Documents
17F-H1716016-REL Decision – 546761.pdf
Uploaded 2025-10-08T07:01:12 (61.1 KB)
17F-H1716016-REL Decision – 552261.pdf
Uploaded 2025-10-08T07:01:13 (553.3 KB)
Briefing Doc – 17F-H1716016-REL
Administrative Hearing Briefing: Sellers vs. Grayhawk Community Association
Executive Summary
This document synthesizes the findings and rulings in the administrative case of John Sellers (Petitioner) versus the Grayhawk Community Association (Respondent), adjudicated by the Arizona Office of Administrative Hearings and finalized by the Department of Real Estate. The core of the dispute was the Petitioner’s claim that the Respondent unlawfully restricted his electronic, view-only access to a bank account in violation of Arizona Revised Statutes (A.R.S.) § 33-1805(A).
The Administrative Law Judge (ALJ) denied the petition, concluding that the Petitioner failed to meet his burden of proof. The evidence showed the Respondent initially provided the requested electronic access, which the Petitioner successfully used before changing the password. The Petitioner offered no evidence that the Respondent subsequently interfered with or restricted this access. Furthermore, the issue was rendered moot when the bank in question closed the account. The ALJ affirmed that the Respondent’s offer to provide paper records satisfied the statutory requirement to make records “reasonably available.” This decision was subsequently adopted as a Final Order by the Commissioner of the Department of Real Estate.
Case Overview
Details
Case Name
John Sellers, Petitioner, vs. Grayhawk Community Association, Respondent.
Case Numbers
Docket No. 17F-H1716016-REL; Case No. HO 17-16/016
Adjudicating Body
Arizona Office of Administrative Hearings
Administrative Law Judge
Suzanne Marwil
Hearing Date
February 16, 2017
ALJ Decision Date
February 21, 2017
Final Order Date
March 3, 2017
Final Order Issued By
Judy Lowe, Commissioner, Department of Real Estate
The Core Dispute
Petitioner’s Position
John Sellers alleged that after he requested and received view-only access to the Association’s Alliance Association Bank account, the Respondent unilaterally restricted that access. He claimed the Respondent’s failure to restore access by his deadline of the close of business on November 25, 2016, constituted a violation of A.R.S. § 33-1805(A), which governs a member’s right to examine association records. The petition, for which a $500 fee was paid, was specifically focused on this single issue.
Respondent’s Position
The Grayhawk Community Association argued that it had gone beyond its statutory obligations by arranging for the bank to create a new online password specifically for the Petitioner. They maintained that after providing this access, they did not interfere with or restrict it in any way. They contended that the Petitioner’s subsequent inability to access the account was due to unknown reasons. The Respondent noted that the bank closed the account on November 28, 2016, making any form of electronic access permanently unavailable and rendering the issue moot. They also offered to provide paper copies of the relevant bank records.
Chronology of Key Events
• October 18, 2016: Petitioner John Sellers requests, among other items, an electronic, read-only password for the Respondent’s Alliance Association Bank account.
• November 2, 2016: The Respondent notifies the Petitioner that such a password did not exist at the time of the request.
• November 16, 2016: After requesting the bank create a password, the Respondent forwards the new login information to the Petitioner.
• Post-November 16, 2016: The Petitioner successfully logs into the bank account using the provided information and changes the password.
• Thanksgiving Day (November 24, 2016): The Petitioner attempts to log in again but “could not see anything.” Based on the assumption that the Respondent had restricted his access, he emails community manager Michael Fee.
• Thanksgiving Day Demand: In his email, the Petitioner sets a deadline for the Respondent to restore his access by the end of the business day on Friday, November 25, 2016, threatening to file a petition if the deadline is not met. Mr. Fee replies that he will contact the bank.
• November 28, 2016: Having not heard further from the Respondent, the Petitioner files the petition in this matter.
• November 28, 2016: On the same day, the Respondent informs the Petitioner that they do not know the reason for the lack of access and denies that anyone affiliated with the association interfered. It is also on this date that Alliance Association Bank closes the account in question.
Analysis of the Administrative Law Judge’s Decision
The ALJ’s decision was based on a hearing held on February 16, 2017. The ruling systematically dismantled the Petitioner’s case based on the evidence presented.
Burden and Standard of Proof
• Pursuant to Arizona Administrative Code (A.A.C.) R2-19-119(B), the Petitioner held the burden of proof.
• The required standard of proof was a preponderance of the evidence, meaning the Petitioner had to show it was more likely than not that his claim was true.
Key Findings of Fact
1. Access Was Provided: It was undisputed that the Respondent provided the Petitioner with login information and that this information initially worked, enabling him to access the account.
2. Petitioner Changed Password: After gaining access, the Petitioner changed the password.
3. No Evidence of Interference: The Petitioner offered “no evidence that Respondent took any action to deny Petitioner online access.” His belief that access was restricted was a “unilateral assumption.” The record did not establish why the new password failed to work on Thanksgiving Day.
4. Issue Rendered Moot: The undisputed closure of the bank account by the bank on November 28, 2016, made the request for electronic access moot, as such access was no longer available to anyone.
Key Conclusions of Law
1. Failure to Meet Burden of Proof: The ALJ concluded that the “Petitioner has failed to meet his burden of proof.” The record was “devoid of any evidence” that the Respondent denied the requested information or took any action to restrict access.
2. Compliance with A.R.S. § 33-1805(A): The statute requires that association records “be made reasonably available for examination.” The ALJ found that the Respondent complied with the statute by initially providing electronic access and later offering to “furnish the Petitioner paper copies of documents it possessed related to that bank account.”
3. Electronic vs. Paper Access: The Petitioner’s argument that paper access is inferior to electronic access was dismissed as a “policy argument that should be addressed to the Legislature.” The plain language of the existing statute does not mandate a specific format for record examination.
Final Order and Outcome
On March 3, 2017, the Commissioner of the Department of Real Estate issued a Final Order, which fully adopted the ALJ’s decision.
• Petition Denied: The Commissioner accepted the ALJ’s decision that the petition be denied.
• Future Compliance Directive: The order stated, “The Commissioner accepts the Recommended Order that Respondent shall comply with the applicable provisions of Arizona Revised Statutes (‘A.R.S.’) § 33-1804 (A) in the future.”
• Binding Decision: The order became a final administrative action, effective immediately and binding on the parties.
• Rehearing and Appeal Process: Parties were notified that a motion for rehearing or review could be filed within 30 days. A request for rehearing should be addressed to Abby Hansen, 2910 N. 44th Street, Suite 100, Phoenix, Arizona, 85018. The order could also be appealed via a complaint for judicial review.
The Petitioner achieved a partial win. The Respondent HOA was found to have violated A.R.S. § 33-1250(C)(2) by using substantively different ballots which impaired the voting rights of absentee members. The HOA was ordered to reimburse the Petitioner’s $500.00 filing fee, but no other relief was granted.
Why this result: Petitioner failed to prove a violation of A.R.S. § 33-1250(C)(4).
Key Issues & Findings
Denial of right to vote for or against each proposed action due to substantively different ballots.
The Respondent violated A.R.S. § 33-1250(C)(2) by using two substantively different ballots for the 2016 election. The meeting ballot included a seventh candidate whose name was not on the mail-in ballot, denying members who did not attend the meeting the opportunity to vote for or against all proposed candidates.
Orders: Petitioner's Petition is granted. Respondent must reimburse Petitioner’s filing fee of $500.00 within thirty (30) days. No other relief is available to Petitioner.
Filing fee: $500.00, Fee refunded: Yes
Disposition: petitioner_win
Cited:
A.R.S. § 33-1250(C)(2)
A.R.S. § 33-1250(C)
Absentee Ballot Requirements (Received-by date and advance delivery)
The ALJ concluded Respondent did not violate A.R.S. § 33-1250(C)(4). While the meeting ballot lacked the statutory requirements listed in C(4), those requirements apply primarily to absentee ballots, and a meeting ballot does not need to comply if it is substantively the same as the compliant absentee ballot.
Orders: The Administrative Law Judge concluded Respondent did not violate A.R.S. § 33-1250(C)(4).
Briefing Document: Gounder v. Royal Riviera Condominium Association
Executive Summary
This briefing document synthesizes the key events, arguments, and legal conclusions from the administrative case of Paul Gounder versus the Royal Riviera Condominium Association (Case No. 17F-H1716002-REL-RHG). The central issue revolved around the Association’s use of two substantively different ballots for its March 14, 2016, board member election.
The Petitioner, Paul Gounder, alleged that the use of a separate mail-in ballot and an in-person meeting ballot, which contained different candidate lists, violated Arizona statute A.R.S. § 33-1250(C)(2). Specifically, the ballot distributed at the meeting included the name of a seventh candidate, Eric Thompson, who was not listed on the mail-in ballot, thereby denying absentee voters the opportunity to vote for all candidates.
After an initial hearing resulted in a recommended dismissal, a rehearing was granted. Administrative Law Judge (ALJ) Suzanne Marwil ultimately concluded that the Association’s actions constituted a statutory violation. The Judge found that because members voting by mail were not informed of Mr. Thompson’s candidacy, they were denied their right to vote “for or against each proposed action.” The Respondent’s argument that the matter was moot due to a subsequent election was rejected.
The Department of Real Estate adopted the ALJ’s decision, issuing a Final Order on June 12, 2017. The Order granted the petition and required the Royal Riviera Condominium Association to reimburse Mr. Gounder’s $500.00 filing fee. The ruling establishes that while election ballots are not required to be identical, any substantive changes must be presented to all members to ensure an equal opportunity to vote.
——————————————————————————–
I. Case Overview and Background
This matter was brought before the Arizona Department of Real Estate and the Office of Administrative Hearings.
• Petitioner: Paul Gounder, a condominium owner and member of the Association.
• Respondent: Royal Riviera Condominium Association, a homeowners’ association for a development of approximately 32 condominiums.
• Initial Petition: Filed on or about June 23, 2016.
• Core Allegation: The Association violated A.R.S. § 33-1250(C)(2) and its own CC&Rs by using two substantively different ballots to elect Board members at its March 14, 2016, annual meeting.
II. Procedural History
1. Initial Hearing (October 17, 2016): A hearing was held before Administrative Law Judge Diane Mihalsky.
2. Recommended Dismissal (October 18, 2016): Judge Mihalsky recommended the petition be dismissed, concluding:
3. Rehearing Granted (February 17, 2017): The Petitioner requested a rehearing, which the Department of Real Estate granted. The Department’s order specifically requested a review of A.R.S. § 33-1250, with a focus on subsection (C)(4).
4. Rehearing (May 17, 2017): A rehearing was held before Administrative Law Judge Suzanne Marwil. At this hearing, the Respondent raised a procedural question regarding the correct statutory subsection for review, leading to a temporary order holding the record open until May 24, 2017, for clarification.
5. ALJ Decision (June 2, 2017): Judge Marwil issued a decision finding that the Respondent had committed a statutory violation.
6. Final Order (June 12, 2017): The Commissioner of the Department of Real Estate, Judy Lowe, accepted the ALJ’s decision and issued a Final Order making the decision binding.
III. The Core Dispute: The Two-Ballot System
The parties stipulated that two different ballots were used for the March 14, 2016, board election, which had seven open positions. The key differences are outlined below.
Feature
Mail Ballot (Absentee)
Meeting Ballot (In-Person)
“Mail Ballot”
“Ballot”
Candidates Listed
Six names
Seven names (added Eric Thompson)
Write-in Option
Included a blank line for a write-in candidate
No space provided for write-in candidates
Distribution
Distributed at least seven days before the meeting
Handed out to members attending the meeting
Return Deadline
Specified the date by which it had to be returned
Did not specify when it needed to be returned
IV. Arguments of the Parties
A. Petitioner’s Position (Paul Gounder)
• Violation of A.R.S. § 33-1250(C)(2): The addition of Eric Thompson’s name to the meeting ballot deprived members who voted by mail of their right “to vote for or against each proposed action,” as they had no opportunity to vote for Mr. Thompson.
• Violation of A.R.S. § 33-1250(C)(4): The meeting ballot violated this subsection because it was not mailed to all members at least seven days in advance of the meeting and did not provide a date by which it had to be received to be counted.
B. Respondent’s Position (Royal Riviera Condominium Association)
• No Violation: The statutes do not explicitly require the use of identical ballots for an election.
• Common Practice: It is a common practice for homeowners’ associations to use a different absentee ballot and meeting ballot.
• Mootness: The issue is moot because the Association had already held another election in 2017 and seated a new board, which included the Petitioner’s wife as a member.
V. Administrative Law Judge’s Findings and Conclusions
In her June 2, 2017 decision, ALJ Suzanne Marwil made the following key legal conclusions:
The ALJ found that the Association’s use of two substantively different ballots did violate this statute.
• Reasoning: Members who did not attend the meeting in person were not notified of Mr. Thompson’s willingness to run for the board. As a result, “these members did not have the opportunity to vote for him and hence were denied their right to vote for or against each proposed action contained in the meeting ballot.”
• Clarification: The ruling explicitly states that this finding does not impose a requirement that all ballots must be identical; however, it establishes that “substantive changes to ballots must be presented to all members.”
The ALJ concluded that no violation of this subsection occurred.
• Reasoning: The Petitioner conceded that the absentee ballot itself complied with the statutory requirements (e.g., being mailed seven days in advance with a return-by date). The judge reasoned that a meeting ballot handed out in person would not need to contain this information if it were “substantively the same as the absentee ballot.” The legal problem arose not from a failure to mail the second ballot, but from the substantive difference between the two.
The ALJ determined that the matter was not rendered moot by the 2017 election and the seating of a new board. The Judge affirmed that the tribunal “can and does find that Respondent committed a statutory violation in the course of holding its 2016 election.”
VI. Final Order and Outcome
• ALJ Recommended Order (June 2, 2017):
◦ The Petitioner’s petition should be granted.
◦ The Respondent must reimburse the Petitioner’s filing fee.
◦ No other relief was available to the Petitioner.
• Department of Real Estate Final Order (June 12, 2017):
◦ The Commissioner of the Department of Real Estate accepted and adopted the ALJ’s decision.
◦ The Order is a final administrative action, effective immediately.
◦ The Royal Riviera Condominium Association was ordered to reimburse the Petitioner’s filing fee of $500.00 within thirty (30) days.
◦ The parties were notified that the Order could be appealed via a complaint for judicial review.
The Petitioner achieved a partial win. The Respondent HOA was found to have violated A.R.S. § 33-1250(C)(2) by using substantively different ballots which impaired the voting rights of absentee members. The HOA was ordered to reimburse the Petitioner’s $500.00 filing fee, but no other relief was granted.
Why this result: Petitioner failed to prove a violation of A.R.S. § 33-1250(C)(4).
Key Issues & Findings
Denial of right to vote for or against each proposed action due to substantively different ballots.
The Respondent violated A.R.S. § 33-1250(C)(2) by using two substantively different ballots for the 2016 election. The meeting ballot included a seventh candidate whose name was not on the mail-in ballot, denying members who did not attend the meeting the opportunity to vote for or against all proposed candidates.
Orders: Petitioner's Petition is granted. Respondent must reimburse Petitioner’s filing fee of $500.00 within thirty (30) days. No other relief is available to Petitioner.
Filing fee: $500.00, Fee refunded: Yes
Disposition: petitioner_win
Cited:
A.R.S. § 33-1250(C)(2)
A.R.S. § 33-1250(C)
Absentee Ballot Requirements (Received-by date and advance delivery)
The ALJ concluded Respondent did not violate A.R.S. § 33-1250(C)(4). While the meeting ballot lacked the statutory requirements listed in C(4), those requirements apply primarily to absentee ballots, and a meeting ballot does not need to comply if it is substantively the same as the compliant absentee ballot.
Orders: The Administrative Law Judge concluded Respondent did not violate A.R.S. § 33-1250(C)(4).
Briefing Document: Gounder v. Royal Riviera Condominium Association
Executive Summary
This briefing document synthesizes the key events, arguments, and legal conclusions from the administrative case of Paul Gounder versus the Royal Riviera Condominium Association (Case No. 17F-H1716002-REL-RHG). The central issue revolved around the Association’s use of two substantively different ballots for its March 14, 2016, board member election.
The Petitioner, Paul Gounder, alleged that the use of a separate mail-in ballot and an in-person meeting ballot, which contained different candidate lists, violated Arizona statute A.R.S. § 33-1250(C)(2). Specifically, the ballot distributed at the meeting included the name of a seventh candidate, Eric Thompson, who was not listed on the mail-in ballot, thereby denying absentee voters the opportunity to vote for all candidates.
After an initial hearing resulted in a recommended dismissal, a rehearing was granted. Administrative Law Judge (ALJ) Suzanne Marwil ultimately concluded that the Association’s actions constituted a statutory violation. The Judge found that because members voting by mail were not informed of Mr. Thompson’s candidacy, they were denied their right to vote “for or against each proposed action.” The Respondent’s argument that the matter was moot due to a subsequent election was rejected.
The Department of Real Estate adopted the ALJ’s decision, issuing a Final Order on June 12, 2017. The Order granted the petition and required the Royal Riviera Condominium Association to reimburse Mr. Gounder’s $500.00 filing fee. The ruling establishes that while election ballots are not required to be identical, any substantive changes must be presented to all members to ensure an equal opportunity to vote.
——————————————————————————–
I. Case Overview and Background
This matter was brought before the Arizona Department of Real Estate and the Office of Administrative Hearings.
• Petitioner: Paul Gounder, a condominium owner and member of the Association.
• Respondent: Royal Riviera Condominium Association, a homeowners’ association for a development of approximately 32 condominiums.
• Initial Petition: Filed on or about June 23, 2016.
• Core Allegation: The Association violated A.R.S. § 33-1250(C)(2) and its own CC&Rs by using two substantively different ballots to elect Board members at its March 14, 2016, annual meeting.
II. Procedural History
1. Initial Hearing (October 17, 2016): A hearing was held before Administrative Law Judge Diane Mihalsky.
2. Recommended Dismissal (October 18, 2016): Judge Mihalsky recommended the petition be dismissed, concluding:
3. Rehearing Granted (February 17, 2017): The Petitioner requested a rehearing, which the Department of Real Estate granted. The Department’s order specifically requested a review of A.R.S. § 33-1250, with a focus on subsection (C)(4).
4. Rehearing (May 17, 2017): A rehearing was held before Administrative Law Judge Suzanne Marwil. At this hearing, the Respondent raised a procedural question regarding the correct statutory subsection for review, leading to a temporary order holding the record open until May 24, 2017, for clarification.
5. ALJ Decision (June 2, 2017): Judge Marwil issued a decision finding that the Respondent had committed a statutory violation.
6. Final Order (June 12, 2017): The Commissioner of the Department of Real Estate, Judy Lowe, accepted the ALJ’s decision and issued a Final Order making the decision binding.
III. The Core Dispute: The Two-Ballot System
The parties stipulated that two different ballots were used for the March 14, 2016, board election, which had seven open positions. The key differences are outlined below.
Feature
Mail Ballot (Absentee)
Meeting Ballot (In-Person)
“Mail Ballot”
“Ballot”
Candidates Listed
Six names
Seven names (added Eric Thompson)
Write-in Option
Included a blank line for a write-in candidate
No space provided for write-in candidates
Distribution
Distributed at least seven days before the meeting
Handed out to members attending the meeting
Return Deadline
Specified the date by which it had to be returned
Did not specify when it needed to be returned
IV. Arguments of the Parties
A. Petitioner’s Position (Paul Gounder)
• Violation of A.R.S. § 33-1250(C)(2): The addition of Eric Thompson’s name to the meeting ballot deprived members who voted by mail of their right “to vote for or against each proposed action,” as they had no opportunity to vote for Mr. Thompson.
• Violation of A.R.S. § 33-1250(C)(4): The meeting ballot violated this subsection because it was not mailed to all members at least seven days in advance of the meeting and did not provide a date by which it had to be received to be counted.
B. Respondent’s Position (Royal Riviera Condominium Association)
• No Violation: The statutes do not explicitly require the use of identical ballots for an election.
• Common Practice: It is a common practice for homeowners’ associations to use a different absentee ballot and meeting ballot.
• Mootness: The issue is moot because the Association had already held another election in 2017 and seated a new board, which included the Petitioner’s wife as a member.
V. Administrative Law Judge’s Findings and Conclusions
In her June 2, 2017 decision, ALJ Suzanne Marwil made the following key legal conclusions:
The ALJ found that the Association’s use of two substantively different ballots did violate this statute.
• Reasoning: Members who did not attend the meeting in person were not notified of Mr. Thompson’s willingness to run for the board. As a result, “these members did not have the opportunity to vote for him and hence were denied their right to vote for or against each proposed action contained in the meeting ballot.”
• Clarification: The ruling explicitly states that this finding does not impose a requirement that all ballots must be identical; however, it establishes that “substantive changes to ballots must be presented to all members.”
The ALJ concluded that no violation of this subsection occurred.
• Reasoning: The Petitioner conceded that the absentee ballot itself complied with the statutory requirements (e.g., being mailed seven days in advance with a return-by date). The judge reasoned that a meeting ballot handed out in person would not need to contain this information if it were “substantively the same as the absentee ballot.” The legal problem arose not from a failure to mail the second ballot, but from the substantive difference between the two.
The ALJ determined that the matter was not rendered moot by the 2017 election and the seating of a new board. The Judge affirmed that the tribunal “can and does find that Respondent committed a statutory violation in the course of holding its 2016 election.”
VI. Final Order and Outcome
• ALJ Recommended Order (June 2, 2017):
◦ The Petitioner’s petition should be granted.
◦ The Respondent must reimburse the Petitioner’s filing fee.
◦ No other relief was available to the Petitioner.
• Department of Real Estate Final Order (June 12, 2017):
◦ The Commissioner of the Department of Real Estate accepted and adopted the ALJ’s decision.
◦ The Order is a final administrative action, effective immediately.
◦ The Royal Riviera Condominium Association was ordered to reimburse the Petitioner’s filing fee of $500.00 within thirty (30) days.
◦ The parties were notified that the Order could be appealed via a complaint for judicial review.
