Briefing Doc – 18F-H1817018-REL-RHG
Briefing Document: Servilla v. Village of Oakcreek Association (Case No. 18F-H1817018-REL-RHG)
Executive Summary
This briefing document analyzes the Administrative Law Judge (ALJ) Decision in the case of Scott S. Servilla versus the Village of Oakcreek Association. The final order, issued on January 9, 2019, following a rehearing, denied the petitioner’s claims. The central issue revolved around a homeowners association vote held on November 10, 2016, where two distinct amendments—one concerning property leasing and another a schedule of fines—were combined into a single item on the ballot.
The petitioner argued this ballot format violated Arizona statute A.R.S. § 33-1812(A), which requires a separate opportunity to vote for or against each proposed action. However, the ALJ’s decision did not rule on the merits of this statutory violation. Instead, the petition was denied based on the legal doctrine of waiver. The ALJ concluded that the petitioner, having received the allegedly defective ballot more than a month before the vote, had forfeited his right to challenge the procedure by failing to raise any objection until after the vote was completed and the unfavorable outcome was known. The decision heavily relies on the precedent set by the Arizona Supreme Court in Zajac v. City of Casa Grande, which established that a party cannot knowingly allow a flawed election to proceed and then protest only after receiving an undesirable result. The ALJ’s decision is binding, with any appeal required to be filed in superior court.
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I. Case Overview
This matter was a dispute brought before the Arizona Office of Administrative Hearings between a homeowner and a homeowners association regarding the validity of an amendment to the association’s governing documents.
Case Detail
Information
Case Number
18F-H1817018-REL-RHG
Petitioner
Scott Servilla & Heidi H Servilla
Respondent
Village of Oakcreek Association
Administrative Law Judge
Tammy L. Eigenheer
Hearing Date
November 29, 2018
Record Held Open Until
December 20, 2018
Decision Issued
January 9, 2019
II. Procedural History
1. Initial Petition: On or about November 13, 2017, Scott S. Servilla filed a petition with the Arizona Department of Real Estate against the Village of Oakcreek Association, an HOA with 2436 homeowners.
2. Expansion of Claims: The petitioner initially filed a single-issue petition with a $500 fee but was ordered by the ALJ to either specify the single issue or pay for a multi-issue hearing. The petitioner paid an additional $1,000 and proceeded with three distinct claims.
3. First ALJ Decision: Following an initial hearing, the ALJ found that the petitioner failed to prove two of his three claims. On the second claim—the improper ballot format—the judge found a statutory violation had occurred but concluded that “because the statute did not provide an enforcement mechanism to the Administrative Law Judge, no remedy could be ordered.”
4. Request for Rehearing: The petitioner filed a Request for Reconsideration, arguing that the conclusion of “no remedy” was contrary to law.
5. Rehearing Granted: On or about September 21, 2018, the Commissioner for the Arizona Department of Real Estate granted the request for a rehearing, which was held on November 29, 2018.
III. The Central Dispute: The November 10, 2016 Vote
The core of the dispute was the validity of a vote taken during a Special Meeting of Members on November 10, 2016.
• Bundled Amendments: The vote’s stated purpose was to approve the “Leasing and Schedule of Fines Assessment.” This single proposal combined two separate and substantive changes to the Master Declaration:
1. Addition of Section 4.23: Leasing of Lots and Units; Restrictions and Limitations, which established a minimum lease term of 30 days and prohibited leasing less than an entire unit.
2. Replacement of Section 5.08: Schedule of Fines, which permitted the association’s committee to adopt a new schedule specifying fines for violations.
• Ballot Format: The absentee ballot provided members with only a single voting choice: “FOR THE LEASING AND SCHEDULE OF FINES AMENDMENT” or “AGAINST THE LEASING AND SCHEDULE OF FINES AMENDMENT.”
• Statutory Violation Alleged: The petitioner contended this format violated A.R.S. § 33-1812(A), which requires that a ballot “shall set forth each proposed action” and “shall provide an opportunity to vote for or against each proposed action.”
• Vote Outcome: A total of 1,067 ballots were received (approximately 44% of members). Of those, 564 voted in favor of the amendment, constituting approximately 53% of the votes cast.
IV. Key Arguments at Rehearing
• Statutory Violation: The ballot was legally defective because it combined two distinct proposed actions into one vote, denying members the right to vote on each separately as required by statute.
• Evidence of Dissent: The petitioner argued that a subsequent vote in April 2017, in which members rejected a proposal to eliminate the By-Laws’ $50 fine limit, demonstrated that “had the proposed amendment been broken into two parts, the part of the proposed amendment dealing with the fines most likely would have failed.”
• Requested Remedy: The petitioner argued that based on case law, the ALJ was authorized to declare the entire amendment void and unenforceable.
• Waiver of Objection: The respondent’s primary argument was that the petitioner had waived any right to object to the ballot format. The petitioner received the absentee ballot on or about October 4, 2016, but did not raise an objection until April 2017, long after the November 10, 2016 vote was completed.
• Lack of Enforcement Provision: The respondent also maintained its earlier position that even if a violation of A.R.S. § 33-1812(A)(2) occurred, the statute itself provides no enforcement mechanism or remedy.
V. Administrative Law Judge’s Decision and Rationale
The ALJ’s final decision denied the petitioner’s petition in its entirety, based solely on the legal principle of waiver.
The ALJ found that the petitioner’s failure to object to the ballot’s format in a timely manner was fatal to his claim.
• Awareness of Defect: The petitioner received the absentee ballot on October 4, 2016, over a month before the November 10, 2016 vote. This provided sufficient time to identify the procedural issue and raise an objection.
• Failure to Act: By not objecting before the vote, the petitioner allowed the flawed process to proceed. He only lodged a complaint after the results were not in his favor.
• Forfeiture of Rights: The ALJ concluded, “As Petitioner was or should have been aware of the alleged issues with the ballot, he waived his right to bring forth a complaint about the ballot when he allowed the vote to proceed on November 10, 2016.”
The decision rested on the Arizona Supreme Court case Zajac v. City of Casa Grande (2004), which itself relied on Allen v. State (1913). This precedent establishes that a party cannot remain silent about a known procedural defect in an election process and then challenge the process only after an unfavorable outcome.
• Key Principle: The ALJ articulated the principle from Zajac: “one cannot knowingly let a defective vote proceed only to complain and seek redress if the results are not to the individual’s liking.”
• Direct Quotation: The decision directly quotes the ruling in Zajac to finalize its point: “He cannot have it both ways; that is, he cannot allow the [vote] to proceed without objection, and then be permitted thereafter to assert his protest.”
• Petition Denied: “IT IS ORDERED that Petitioner’s petition is denied.”
• Binding Decision: As the decision was issued as a result of a rehearing, it is legally binding on the parties.
• Appeal Process: Any party wishing to appeal the order must file for judicial review with the superior court within thirty-five days from the date the order was served (January 9, 2019).
Study Guide – 18F-H1817018-REL-RHG
Study Guide: Servilla v. Village of Oakcreek Association (Case No. 18F-H1817018-REL-RHG)
This guide provides a comprehensive review of the administrative legal case involving Petitioner Scott Servilla and Respondent Village of Oakcreek Association, as detailed in the Administrative Law Judge Decision of January 9, 2019. It includes a short-answer quiz to test factual recall, a corresponding answer key, suggested essay questions for deeper analysis, and a glossary of key terms.
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Short Answer Quiz
Instructions: Answer the following ten questions in 2-3 sentences each, based entirely on the information provided in the source documents.
1. Who were the primary parties in this case, and what roles did they play?
2. What were the two distinct proposed changes that were combined into a single voting item on the November 10, 2016 absentee ballot?
3. Which specific Arizona Revised Statute did the Petitioner allege was violated by the format of the ballot, and what does that statute require?
4. What was the numerical outcome of the November 10, 2016 vote on the proposed amendment?
5. What was the Respondent’s primary legal argument for why the Petitioner’s complaint about the faulty ballot should be dismissed?
6. What key legal precedent, specifically the case of Zajac v. City of Casa Grande, did the Administrative Law Judge (ALJ) rely upon in the final decision?
7. According to the decision, when did the Petitioner receive the ballot, and why was this date critical to the ALJ’s final ruling?
8. What was the finding in the initial Administrative Law Judge Decision regarding the ballot issue, and why did it lead to a request for a rehearing?
9. Describe the separate vote that occurred in April 2017 and explain how the Petitioner used it to support his argument regarding the 2016 vote.
10. What was the final order issued by Administrative Law Judge Tammy L. Eigenheer on January 9, 2019, and what was the legal basis for this order?
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Answer Key
1. The primary parties were the Petitioner, Scott S. Servilla (who appeared on his own behalf), and the Respondent, the Village of Oakcreek Association (a homeowners association represented by Mark Sahl). The Petitioner filed a complaint against the Respondent with the Arizona Department of Real Estate.
2. The two proposed changes were the addition of a new section, 4.23, concerning “Leasing of Lots and Units; Restrictions and Limitations,” and the complete replacement of an existing section, 5.08, titled “Schedule of Fines.” The ballot presented these as a single item called the “LEASING AND SCHEDULE OF FINES AMENDMENT.”
3. The Petitioner alleged a violation of A.R.S. § 33-1812(A)(2) and A.R.S. § 33-1812(B)(2). The statute requires that an absentee ballot “shall set forth each proposed action” and “shall provide an opportunity to vote for or against each proposed action.”
4. A total of 1067 ballots were received, representing approximately 44 percent of the members. Of those who voted, 564 (approximately 53 percent) voted in favor of the proposed amendment.
5. The Respondent’s primary argument was that the Petitioner had waived any right to object to the ballot’s format. The Respondent contended that the Petitioner should have raised his objection before the vote occurred, rather than waiting until after the results were known.
6. The ALJ relied on the precedent set in Zajac v. City of Casa Grande. This Arizona Supreme Court case established the principle that an individual aware of a procedural issue with an election cannot wait to see the results before lodging a complaint.
7. The Petitioner acknowledged receiving the absentee ballot on or about October 4, 2016, more than a month before the November 10, 2016 vote. This date was critical because it demonstrated that the Petitioner had ample time to object to the ballot’s format before the vote took place, supporting the ALJ’s waiver finding.
8. In the initial decision, the ALJ found that a violation of the statute had occurred regarding the ballot but concluded that no remedy could be ordered because the statute lacked an enforcement mechanism. The Petitioner requested a rehearing, alleging that this conclusion was contrary to the law and that the ALJ did have the authority to declare the amendment void.
9. In April 2017, a separate proposed amendment to eliminate the By-Laws’ $50 fine limitation was voted down by the members. The Petitioner argued this subsequent vote demonstrated that the fines portion of the November 2016 amendment would likely have failed if members had been given a separate opportunity to vote on it.
10. The final order, issued January 9, 2019, denied the Petitioner’s petition. The legal basis was the doctrine of waiver; the ALJ ruled that because the Petitioner was aware of the alleged issues with the ballot before the vote and failed to object, he waived his right to complain about it after the results were announced.
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Essay Questions
Instructions: The following questions are designed to encourage deeper analysis of the case. Formulate comprehensive essay responses based on the details and legal reasoning presented in the source documents.
1. Explain the legal doctrine of waiver as applied in this case. How did the timeline of events, from the receipt of the ballot to the filing of the petition, support the Administrative Law Judge’s application of the principles from Zajac v. City of Casa Grande?
2. Analyze the conflicting interpretations of “proposed action” under A.R.S. § 33-1812(A) as presented by the Petitioner and the Respondent. Although the Judge ultimately ruled on procedural grounds, which party’s interpretation of the statute appears more consistent with the law’s text and intent?
3. Discuss the procedural history of this case, from the initial filing with the Arizona Department of Real Estate through the first decision, the request for reconsideration, and the final ruling on rehearing. What does this progression reveal about the administrative hearing process and the remedies available to petitioners?
4. The Petitioner attempted to use the results of an April 2017 vote to argue that the fines portion of the November 2016 amendment would likely have failed if voted on separately. Evaluate the strength and relevance of this argument within the legal context of the case.
5. Imagine the Petitioner had raised his objection to the ballot format before the November 10, 2016 vote. Based on the information in the decision, how might the proceedings and the ultimate outcome have been different?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official who presides over administrative hearings, hears evidence, and issues decisions and orders. In this case, Tammy L. Eigenheer.
A.R.S. (Arizona Revised Statutes)
The collection of laws enacted by the Arizona state legislature. The Petitioner alleged violations of A.R.S. § 33-1817 and § 33-1812.
Absentee Ballot
A ballot that allows a member to vote without being physically present at a meeting. The format of this ballot was the central issue of the rehearing.
By-Laws
The rules that govern the internal operations of an association. The Petitioner cited a violation of By-Laws Section 8, Article VIII concerning a $50 fine limit.
Department (The Department)
The Arizona Department of Real Estate, the state agency where the Petitioner first filed his petition against the homeowners association.
Master Declaration
A core governing document for a homeowners association that establishes rules, restrictions, and obligations for homeowners. The November 10, 2016 vote was to amend this document.
A formal, binding decision issued by a judge. The final document in this case was an order denying the Petitioner’s petition.
Petitioner
The party who initiates a legal action by filing a petition. In this case, Scott Servilla & Heidi H. Servilla.
Preponderance of the Evidence
The standard of proof required in this proceeding. It means the evidence presented is more convincing and likely to be true than the evidence offered in opposition.
Rehearing
A second hearing of a case granted to reconsider the initial decision. A rehearing was granted after the Petitioner argued that the initial finding of “no remedy” was contrary to law.
Respondent
The party against whom a petition is filed and who must respond to the allegations. In this case, the Village of Oakcreek Association.
Waiver
A legal doctrine where a party intentionally or through inaction gives up a known right or claim. The ALJ ruled the Petitioner waived his right to object to the ballot by not raising the issue before the vote.
Zajac v. City of Casa Grande
An Arizona Supreme Court case that established a key legal precedent used in this decision. It holds that a party cannot knowingly allow a defective vote to proceed and then complain only if the results are unfavorable.
Blog Post – 18F-H1817018-REL-RHG
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{
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“case_title”: “Scott Servilla & Heidi H Servilla, Petitioner, vs. Village of Oakcreek Association, Respondent.”,
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This document summarizes the administrative law judge decision in the rehearing case of Scott Servilla & Heidi H Servilla v. Village of Oakcreek Association, Case No. 18F-H1817018-REL-RHG1. This matter was heard by Administrative Law Judge Tammy L. Eigenheer on November 29, 2018, with the record held open until December 20, 20181.
Procedural History (Original Decision vs. Rehearing)
Petitioner Scott Servilla filed a petition with the Arizona Department of Real Estate (ADRE) against the Village of Oakcreek Association (Respondent) alleging multiple violations of statute and the community’s Master Declaration2,3.
Original Decision: The Administrative Law Judge initially ruled on three issues4. The ALJ found that Petitioner failed to prove two claims5. However, the ALJ found that the Respondent violated A.R.S. § 33-1812(B)(2) regarding the written ballot, but concluded that because the statute did not provide an enforcement mechanism, no remedy could be ordered5.
Rehearing Grant: Following this initial decision, Petitioner filed a Request for Reconsideration, arguing the conclusion that no remedy existed was contrary to law6. The ADRE Commissioner granted the request for rehearing6.
Key Facts and Issue for Rehearing
The central issue during the rehearing concerned the statutory violation found in the original decision: whether the November 10, 2016 vote to amend the Master Declaration was invalid because the absentee ballot failed to comply with A.R.S. § 33-1812(A)4,7.
The Ballot Violation: A.R.S. § 33-1812(A) requires that absentee ballots set forth “each proposed action” and provide an opportunity to vote for or against “each proposed action”7. The Respondent’s proposed amendment bundled two distinct actions: the addition of leasing restrictions and the complete replacement of the Schedule of Fines8,9,10. The ballot only allowed members to vote “FOR” or “AGAINST THE LEASING AND SCHEDULE OF FINES AMENDMENT” as a single package9.
Key Legal Argument and Decision
At the rehearing, the core legal debate shifted from whether a violation occurred to whether the Petitioner was entitled to relief, specifically whether the ALJ could declare the amendment void and unenforceable6,11.
Respondent’s Defense and the Doctrine of Waiver: Respondent argued that Petitioner had waived the right to object because he did not raise any complaint about the defective ballot prior to the vote12. Petitioner received the ballot more than one month before the November 10, 2016 vote13.
ALJ Legal Conclusion: Drawing on Arizona Supreme Court precedent (Zajac v. City of Casa Grande)10,14, the Administrative Law Judge concluded that an individual cannot allow a known defective vote to proceed and only complain afterward if dissatisfied with the results15,16. Because Petitioner failed to raise an objection to the faulty ballot prior to the scheduled vote, he waived his right to bring a subsequent complaint about the ballot16.
Based on the application of the waiver doctrine, the ALJ found that Petitioner’s claim as to the ballot must fail16. The Administrative Law Judge ordered that Petitioner’s petition is denied17. This order, resulting from the rehearing, is binding on the parties17.
{
“case”: {
“agency”: “ADRE”,
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“docket_no”: “18F-H1817018-REL-RHG”,
“case_title”: “Scott Servilla & Heidi H Servilla vs. Village of Oakcreek Association”,
“decision_date”: “2019-01-09”,
“alj_name”: “Tammy L. Eigenheer”
},
“parties”: [
{
“party_id”: “P1”,
“role”: “petitioner”,
“name”: “Scott Servilla & Heidi H Servilla”,
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{
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}
],
“issues”: [
{
“issue_id”: “ISS-001”,
“type”: “statute”,
“citation”: “A.R.S. § 33-1817(A)(1)”,
“caption”: “Vote count required to amend declaration”,
“violation(s)”: “Alleged violation of A.R.S. § 33-1817(A)(1) and Declaration regarding the required majority vote (1173 votes) for the November 10, 2016 amendment.”,
“summary”: “Petitioner requested an order declaring the amendment invalid due to insufficient vote count.”,
“outcome”: “respondent_win”,
“filing_fee_paid”: 500.0,
“filing_fee_refunded”: false,
“civil_penalty_amount”: 0.0,
“orders_summary”: “Claim failed.”,
“why_the_loss”: “Petitioner failed to prove the claim.”,
“cited”: []
},
{
“issue_id”: “ISS-002”,
“type”: “statute”,
“citation”: “A.R.S. § 33-1812(A)”,
“caption”: “Absence of separate voting opportunity for proposed actions”,
“violation(s)”: “The written ballot used for the November 10, 2016 amendment violated A.R.S. § 33-1812(A) and (B)(2) because it bundled two distinct proposed actions (Leasing Restrictions and Schedule of Fines) into a single vote.”,
“summary”: “Petitioner sought an order declaring the amendment invalid because the ballot improperly required a single vote on two separate actions.”,
“outcome”: “respondent_win”,
“filing_fee_paid”: 500.0,
“filing_fee_refunded”: false,
“civil_penalty_amount”: 0.0,
“orders_summary”: “Claim denied on rehearing. Petition denied.”,
“why_the_loss”: “Petitioner waived the right to object to the faulty ballot by receiving it over a month prior and allowing the vote to proceed on November 10, 2016, without raising a complaint.”,
“cited”: [
“A.R.S. § 33-1812(A)”,
“Zajac v. City of Casa Grande, 209 Ariz. 357, 102 P.3d 297”,
“Allen v. State, 14 Ariz. 458, 130 P. 1114”
]
},
{
“issue_id”: “ISS-003”,
“type”: “governing_document”,
“citation”: “By-Laws Section 8, Article VIII”,
“caption”: “Unauthorized fines in excess of $50”,
“violation(s)”: “Respondent allegedly violated By-Laws by imposing fines in excess of $50 per violation, especially after a proposed amendment to raise the fines was voted down.”,
“summary”: “Petitioner requested an order that the Association cannot levy fines in excess of $50 per violation.”,
“outcome”: “respondent_win”,
“filing_fee_paid”: 500.0,
“filing_fee_refunded”: false,
“civil_penalty_amount”: 0.0,
“orders_summary”: “Claim failed.”,
“why_the_loss”: “Petitioner failed to prove the claim.”,
“cited”: []
}
],
“money_summary”: {
“issues_count”: 3,
“total_filing_fees_paid”: 1500.0,
“total_filing_fees_refunded”: 0.0,
“total_civil_penalties”: 0.0
},
“outcomes”: {
“petitioner_is_hoa”: false,
“petitioner_win”: “loss”,
“summarize_judgement”: “The Administrative Law Judge denied the entire petition. Although the Respondent used a faulty ballot (Issue 2), the Petitioner waived the right to object by failing to raise a complaint prior to the vote. Petitioner also failed to prove his claims for issues 1 and 3.”,
“why_the_loss”: “Petitioner waived the right to object to the ballot defect (Issue 2) by allowing the vote to proceed without objection, and failed to prove the claims for Issues 1 and 3.”,
“cited”: [
“A.R.S. § 33-1812(A)”,
“Zajac v. City of Casa Grande, 209 Ariz. 357, 102 P.3d 297”
]
},
“analytics”: {
“cited”: [
“A.R.S. § 33-1817(A)(1)”,
“A.R.S. § 33-1812(A)”,
“A.R.S. § 33-1812(B)(2)”,
“Zajac v. City of Casa Grande, 209 Ariz. 357, 102 P.3d 297”,
“Allen v. State, 14 Ariz. 458, 130 P. 1114”
],
“tags”: [
“HOA elections”,
“absentee ballots”,
“waiver doctrine”,
“amendment procedure”,
“fines”
]
}
}
{
“case”: {
“docket_no”: “18F-H1817018-REL-RHG”,
“case_title”: “Scott Servilla & Heidi H Servilla, vs. Village of Oakcreek Association”,
“decision_date”: “2019-01-09”,
“tribunal”: “OAH”,
“agency”: “ADRE”
},
“individuals”: [
{
“name”: “Scott Servilla”,
“role”: “petitioner”,
“side”: “petitioner”,
“affiliation”: null,
“notes”: “Appeared on his own behalf at the hearing; also listed as Scott S. Servilla [1], [2]”
},
{
“name”: “Heidi H Servilla”,
“role”: “petitioner”,
“side”: “petitioner”,
“affiliation”: null,
“notes”: null
},
{
“name”: “Tammy L. Eigenheer”,
“role”: “ALJ”,
“side”: “neutral”,
“affiliation”: “Office of Administrative Hearings”,
“notes”: “Administrative Law Judge [3], [4], [1], [2]”
},
{
“name”: “Mark K. Sahl”,
“role”: “HOA attorney”,
“side”: “respondent”,
“affiliation”: “CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP”,
“notes”: “Represented Village of Oakcreek Association [2]”
},
{
“name”: “Judy Lowe”,
“role”: “commissioner”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Granted the request for rehearing [5]”
},
{
“name”: “c. serrano”,
“role”: “staff”,
“side”: “unknown”,
“affiliation”: null,
“notes”: “Transmitted documents on November 29, 2018 [6], [7]”
},
{
“name”: “Felicia Del Sol”,
“role”: “staff”,
“side”: “unknown”,
“affiliation”: null,
“notes”: “Transmitted documents on January 9, 2019 [8]”
},
{
“name”: “LDettorre”,
“role”: “ADRE staff”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Recipient of transmittal [3], [4]”
},
{
“name”: “AHansen”,
“role”: “ADRE staff”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Recipient of transmittal [3], [4]”
},
{
“name”: “djones”,
“role”: “ADRE staff”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Recipient of transmittal [3], [4]”
},
{
“name”: “DGardner”,
“role”: “ADRE staff”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Recipient of transmittal [3], [4]”
},
{
“name”: “ncano”,
“role”: “ADRE staff”,
“side”: “neutral”,
“affiliation”: “Arizona Department of Real Estate”,
“notes”: “Recipient of transmittal [3], [4]”
}
]
}
