Tag Archives: A.R.S. § 41-2198.01

John W. Griggs v. Executive Towers HOS

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Case Summary

Case ID 15F-H1516004-BFS
Agency Department of Fire, Building and Life Safety
Tribunal Office of Administrative Hearings
Decision Date 2016-01-20
Administrative Law Judge Diane Mihalsky
Outcome no
Filing Fees Refunded $550.00
Civil Penalties $0.00

Parties & Counsel

Petitioner John W. Griggs Counsel —
Respondent Executive Towers Homeowners Association Counsel Christina N. Morgan

Alleged Violations

CC&Rs Paragraph 13; Bylaws Article 4, Section 6

Outcome Summary

The Administrative Law Judge dismissed the petition, ruling that the Association's conversion of a suite into a fitness center was not a structural alteration requiring a vote under the CC&Rs. Additionally, the $4,000 refurbishment cost did not trigger the Bylaws' $5,000 capital expenditure vote requirement, and the equipment lease payments were not considered capital expenditures.

Why this result: Petitioner failed to meet the burden of proof to establish that the renovation was a structural alteration or that the costs constituted a capital expenditure exceeding the limit requiring a vote.

Key Issues & Findings

Unauthorized Structural Alteration and Capital Expenditure

Petitioner alleged the Association violated the CC&Rs and Bylaws by converting a commercial suite into a fitness center without a majority vote of the membership required for structural alterations and capital expenditures exceeding $5,000.

Orders: The petition is dismissed.

Filing fee: $550.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 41-2198.01
  • A.R.S. § 33-1202
  • A.R.S. § 41-1202
  • A.R.S. § 33-1242(A)(7)

Decision Documents

15F-H1516004-BFS Decision – 477049.pdf

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15F-H1516004-BFS Decision – 486638.pdf

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15F-H1516004-BFS Decision – 486698.pdf

Uploaded 2026-01-27T21:12:19 (60.8 KB)

**Case Summary: Griggs v. Executive Towers Homeowners Association**
**Case No.** 15F-H1516004-BFS
**Hearing Date:** January 6, 2016
**Judge:** Diane Mihalsky, Administrative Law Judge (ALJ)

**Proceedings and Background**
Petitioner John W. Griggs, a condominium owner, filed a petition against the Respondent, Executive Towers Homeowners Association, alleging violations of the Association's Covenants, Conditions, and Restrictions (CC&Rs). The dispute arose from the Board's decision to convert "Suite 7," a vacant revenue-generating commercial space within the building, into a fitness center.

The Board had previously solicited feedback via a survey, in which a majority of responding owners favored the fitness center, but the participation level did not constitute a majority of the *entire* membership's voting power. The Respondent proceeded with the conversion based on the survey results and Board approval.

**Key Arguments**
The Petitioner argued that the Board acted outside its authority by proceeding without a formal majority vote of the entire membership. His claims relied on two main legal points:
1. **Structural Alteration:** The Petitioner argued the project constituted a "structural alteration" under CC&Rs Paragraph 13, which requires prior approval from a majority of owners. He contended that "structural" should be interpreted to include mental or monetary implications, not just physical changes.
2. **Capital Expenditure:** The Petitioner argued the project violated Article 4, § 6 of the Bylaws, which prohibits the Board from approving capital expenditures over $5,000 without a two-thirds vote of total ownership. He asserted that the total cost, including equipment leasing payments, exceeded this limit.

The Respondent argued that:
1. The renovation was not structural (removing non-load-bearing walls and flooring) and required no permits.
2. The refurbishment costs were approximately $4,000 (under the $5,000 cap), and the equipment was leased rather than purchased, meaning it was not a capital asset.
3. The Board had the discretion to repurpose common elements to protect property values and utilize vacant space.

**Legal Analysis and Findings**
The ALJ placed the burden of proof on the Petitioner to establish a violation by a preponderance of the evidence.

* **Structural Alteration:** The ALJ defined "structural alteration" as a significant change creating a different building or structure. The evidence showed the work involved removing temporary walls, replacing flooring, and electrical upgrades, none of which required permits or affected load-bearing walls. Consequently, the ALJ found the project was not a structural alteration requiring membership approval under CC&Rs Paragraph 13.
* **Capital Expenditure:** The ALJ accepted testimony that the refurbishment cost was $4,000, falling below the $5,000 Bylaw threshold. Regarding the equipment, the ALJ defined "capital expenditure" as an outlay to acquire or improve a fixed asset.

Case Participants

Petitioner Side

  • John W. Griggs (petitioner)
    Appeared on own behalf; owner of a residence in Executive Towers
  • Linda Pollack (witness)
    Resident/owner; testified for Petitioner
  • Helen Jerzy (witness)
    Executive Towers Homeowners Association
    Board Member; testified for Petitioner

Respondent Side

  • Christina N. Morgan (HOA attorney)
    VialFotheringham LLP
  • William B. Early (witness)
    Former board member; testified for Respondent
  • Wayne Peter Parente (board president)
    Executive Towers Homeowners Association
    Testified for Respondent
  • Jay Russett (property manager)
    Executive Towers Homeowners Association
    Executive Director; testified for Respondent

Neutral Parties

  • Diane Mihalsky (ALJ)
    Office of Administrative Hearings
  • Debra Blake (agency director)
    Department of Fire Building and Life Safety
    Interim Director
  • Greg Hanchett (agency director)
    Office of Administrative Hearings
    Interim Director; certified the decision
  • Joni Cage (agency staff)
    Department of Fire Building and Life Safety
    c/o for Debra Blake
  • Rosella J. Rodriguez (administrative staff)
    Office of Administrative Hearings
    Signed copy certification

SHARON OBERRITTER v. SCOTTSDALE TRAILS

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Case Summary

Case ID 15F-H1516003-BFS
Agency Department of Fire, Building and Life Safety
Tribunal Office of Administrative Hearings
Decision Date 2015-12-23
Administrative Law Judge M. Douglas
Outcome no
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Unknown Counsel —
Respondent Unknown Counsel —

Alleged Violations

CC&Rs Article 16, Section 16.2

Outcome Summary

The Administrative Law Judge determined that the Board's modification of the Rules and Regulations regarding patio storage was not a violation of the CC&Rs and did not require a vote by the owners. The Petitioner failed to meet the burden of proof.

Why this result: Petitioner failed to satisfy the burden of proof to establish that the rule change was invalid or required membership approval.

Key Issues & Findings

Unauthorized Rule Change

Petitioner alleged that the Board violated the CC&Rs by modifying a rule regarding patio storage without obtaining approval from two-thirds of the owners.

Orders: The petition is dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • CC&Rs Article 16, Section 16.2
  • A.R.S. § 41-2198.01

Decision Documents

15F-H1516003-BFS Decision – 472974.pdf

Uploaded 2026-02-12T19:04:24 (89.0 KB)

15F-H1516003-BFS Decision – 486288.pdf

Uploaded 2026-02-12T19:04:25 (59.5 KB)

**Case Summary: Oberritter v. Scottsdale Trails (No. 15F-H1516003-BFS)**

**Proceedings and Parties**
This administrative hearing was held on December 9, 2015, before the Arizona Office of Administrative Hearings. The Petitioner, Sharon Oberritter, a homeowner and Board member, appeared on her own behalf against the Respondent, Scottsdale Trails (a homeowners’ association), represented by legal counsel.

**Key Facts and Main Issues**
The central dispute involved the validity of a June 2014 Board vote that modified the community's Rules and Regulations regarding items stored on patios and balconies.

* **The Change:** The Board voted 4-3 to amend "Section 4, Paragraph 2" of the Rules and Regulations. The modification added language stating that patio storage is prohibited "unless approved by the Board of Directors," explicitly referencing Section 16.2 of the CC&Rs.
* **Petitioner’s Argument:** The Petitioner alleged that this modification effectively altered Article 16, Section 16.2 of the Declaration of Covenants, Conditions and Restrictions (CC&Rs). She argued that changing the CC&Rs requires approval by a two-thirds vote of the owners, making the Board's majority vote invalid. She further expressed concern that the change would negatively impact property appearance and values.
* **Respondent’s Argument:** A testifying Board member stated the vote was to modify the "Rules and Regulations" to comply with the CC&Rs rather than changing the CC&Rs themselves, characterizing it as a "semantic change".

**Legal Rulings and Outcome**
* **Evidentiary Ruling:** At the start of the hearing, the Administrative Law Judge (ALJ) granted the Respondent’s Motion in Limine, excluding any evidence or testimony regarding privileged attorney-client communications.
* **Burden of Proof:** The ALJ noted that the burden of proof rested on the Petitioner to prove the claim by a "preponderance of the evidence".
* **Findings:** The Tribunal concluded that the Petitioner failed to present credible evidence that the language change in the Rules and Regulations violated Section 16.2 of the CC&Rs or that such a rule change required a vote by the homeowners.
* **Final Decision:** The ALJ determined the Petitioner failed to satisfy her burden of proof and ordered the petition dismissed with no action required of the Respondent.

**Case Status**
On March 17, 2016, the decision was certified as the final administrative decision because the Department of Fire, Building and Life Safety took no action to accept, reject, or modify the ALJ's decision within the statutory timeframe.

Janusz, David & Loree vs. Cresta Norte HOA

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Case Summary

Case ID 13F-H1314002-BFS
Agency DFBLS
Tribunal OAH
Decision Date 2014-02-27
Administrative Law Judge M. Douglas
Outcome no
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner David & Loree Janusz Counsel —
Respondent Cresta Norte HOA Counsel Curtis S. Ekmark, Esq.; Molly J. Streiff, Esq.

Alleged Violations

Cresta Norte Guidelines Section N Miscellaneous (7)

Outcome Summary

The ALJ dismissed the petition, ruling that the HOA did not violate its CC&Rs or Design Guidelines by denying the homeowners' request to install exterior shutters. The guidelines required committee approval, which was properly denied.

Why this result: The petitioners failed to meet the burden of proof to show the HOA violated governing documents; the ALJ found the guidelines granted the HOA authority to approve or deny architectural changes.

Key Issues & Findings

Denial of architectural request for exterior shutters

Petitioners alleged the HOA violated design guidelines by denying their request to install exterior shutters. Petitioners argued the guidelines explicitly list 'shutters' as an example of exterior changes, implying they are permitted.

Orders: Petition dismissed; Cresta Norte deemed prevailing party.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • Cresta Norte Guidelines Section N Miscellaneous (7)
  • A.R.S. § 41-2198.01

Decision Documents

13F-H1314002-BFS Decision – 384508.pdf

Uploaded 2026-01-25T15:29:11 (103.9 KB)

13F-H1314002-BFS Decision – 389432.pdf

Uploaded 2026-01-25T15:29:11 (60.8 KB)

**Case Summary: David & Loree Janusz v. Cresta Norte HOA**
**Case No. 13F-H1314002-BFS**

**Forum and Parties**
This matter was heard before the Arizona Office of Administrative Hearings on February 18, 2014. The Petitioners, David and Loree Janusz, represent themselves against the Respondent, Cresta Norte Homeowners Association (HOA), regarding a dispute over architectural improvements.

**Background and Main Issues**
The Petitioners, homeowners in Scottsdale, Arizona, submitted an Architectural Change Request to install exterior shutters on their residence. The Cresta Norte Architectural Committee denied the request, and the HOA Board of Directors subsequently denied the Petitioners' appeal. The Petitioners filed a claim alleging the HOA violated the community’s Design Guidelines and CC&Rs by refusing the installation. The central issue was whether the guidelines, which mention shutters, mandated their approval or if the Board retained discretion to deny them based on community aesthetics.

**Hearing Proceedings and Key Arguments**
**Petitioners' Argument:**
David Janusz, a former Board President (2006–2010) and Architectural Committee chairman, testified that the guidelines were drafted to "encourage creativity and diversity". He argued that Section N Miscellaneous (7) of the guidelines specifically lists "shutters" as a type of exterior change, which he interpreted as explicit authorization for their installation. He asserted that during his tenure, the committee intended to offer shutters to allow homeowners to show individuality. He also testified that no neighbors opposed the project.

**Respondent's Argument:**
The HOA, represented by legal counsel, presented testimony from current Board members James Wooley and Brian McNamara. Mr. Wooley testified that the inclusion of the word "shutters" in the guidelines was merely an example of a potential change requiring review, not an express approval. He stated there was no intent to establish shutters as an approved feature and that the guidelines do not prohibit them but require approval. Mr. McNamara noted that no residences in Cresta Norte currently have exterior shutters and that the Board determined they were not a "desirable architectural feature" for the community.

**Legal Findings**
Administrative Law Judge M. Douglas analyzed the case under the "preponderance of the evidence" standard. The findings focused on the text of the 2011 Design Guidelines, which state: "Any change to the exterior appearance of the house (garage door, stone work, shutters, etc.) must be consistent with the design and color palette of the community. Architectural Committee written approval is

Case Participants

Petitioner Side

  • David Janusz (petitioner)
    Cresta Norte HOA (former board member)
    Appeared on own behalf; testified as witness
  • Loree Janusz (petitioner)
    Cresta Norte HOA
    Appeared on own behalf

Respondent Side

  • Curtis S. Ekmark (HOA attorney)
    Ekmark & Ekmark LLC
  • Molly J. Streiff (HOA attorney)
    Ekmark & Ekmark LLC
  • James A. Wooley (witness)
    Cresta Norte HOA Board of Directors
    Board member and Architectural Committee member
  • Brian McNamara (witness)
    Cresta Norte HOA Board of Directors
    Board member and Architectural Committee member

Neutral Parties

  • M. Douglas (ALJ)
    Office of Administrative Hearings
  • Cliff J. Vanell (Director)
    Office of Administrative Hearings
    Certified the ALJ decision
  • Gene Palma (Director)
    Department of Fire, Building and Life Safety
  • Joni Cage (agency staff)
    Department of Fire, Building and Life Safety
    Listed on mailing certificate c/o Gene Palma
  • Rosella J. Rodriguez (administrative staff)
    Office of Administrative Hearings
    Signed mailing certificate

Walter, Margo vs. Kingswood Owners Association

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Case Summary

Case ID 12F-H1213012-BFS
Agency DFBLS
Tribunal OAH
Decision Date 2013-05-10
Administrative Law Judge Brian Brendan Tully
Outcome false
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Margo L. Walter Counsel —
Respondent Kingswood Owners Association Counsel —

Alleged Violations

A.R.S. § 33-1802(4)

Outcome Summary

The petition was dismissed because the HOA does not own any real property (common elements) and therefore does not qualify as a 'planned community' under Arizona law, depriving the agency of jurisdiction.

Why this result: Lack of jurisdiction; Respondent is not a planned community pursuant to A.R.S. § 33-1802(4).

Key Issues & Findings

Maintenance of private property / Jurisdiction

Petitioner alleged the HOA maintained private driveways in violation of CC&Rs despite the streets being annexed by the city. Respondent moved to dismiss on grounds that it does not own real property and is not a planned community.

Orders: Petition dismissed for lack of jurisdiction. Respondent's request for attorney fees denied.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 33-1802(4)
  • A.R.S. § 41-2198.01

Decision Documents

12F-H1213012-BFS Decision – 332161.pdf

Uploaded 2026-01-25T15:28:33 (72.1 KB)

12F-H1213012-BFS Decision – 337656.pdf

Uploaded 2026-01-25T15:28:34 (57.5 KB)

**Case Summary: Walter v. Kingswood Owners Association**
**Case No:** 12F-H1213012-BFS
**Forum:** Arizona Office of Administrative Hearings
**Date:** March 29, 2013 (Decision); May 10, 2013 (Final Certification)

**Background and Key Facts**
Petitioner Margo L. Walter filed a complaint with the Arizona Department of Fire, Building, and Life Safety (the "Department") against the Kingswood Owners Association ("Respondent"). The Petitioner alleged that the Respondent was violating its Articles and CC&Rs by using HOA membership dues to maintain private property—specifically providing snow removal and crack sealing for six private driveways—despite the fact that the City of Prescott had annexed the community's private streets on June 9, 2000.

**Key Arguments and Issues**
The central issue was whether the Department possessed subject matter jurisdiction to adjudicate the dispute.

* **Respondent’s Argument:** The Respondent filed a Motion to Dismiss, contending that the Department lacked jurisdiction under A.R.S. § 41-2198.01. The Respondent argued it was neither a condominium nor a "planned community" because the Association did not own any real property.
* **Petitioner’s Argument:** The Petitioner opposed the motion and requested the matter proceed to a hearing.

**Legal Analysis and Findings**
Administrative Law Judge Brian Brendan Tully issued a decision focusing on the statutory definition of the entities under the Department's purview.

1. **Statutory Authority:** The Department is authorized to adjudicate disputes involving mobile home parks, condominiums, and planned communities.
2. **Definition of Planned Community:** Under A.R.S. § 33-1802(4), a "planned community" is defined as a real estate development that includes real estate "owned and operated" by the association.
3. **Application to Facts:** The ALJ found it uncontroverted that the Respondent is a nonprofit corporation that does not own any real estate, having sold its private streets to the City of Prescott in 2000.
4. **Conclusion:** Because the Respondent does not own real estate, it does not meet the statutory definition of a "planned community" pursuant to A.R.S. § 33-1802(4). Consequently, the Department lacked jurisdiction over the Respondent.

**Final Decision and Outcome**
* **Dismissal:** The Administrative Law Judge ordered that the Petition be dismissed due to lack of jurisdiction.
* **Costs and Fees:** The Respondent's request for attorney’s fees and costs was denied. The Tribunal noted that the statute cited by the Respondent (A.R.S. § 41-1092.12) applies to the Department of Environmental Quality, not the Department of Fire, Building, and Life Safety.
* **Certification:** The Department took no action to reject or modify the ALJ's decision within the statutory review period. Therefore, the decision was certified as the final administrative decision on May 10, 2013

Case Participants

Petitioner Side

  • Margo L. Walter (Petitioner)
    Also spelled 'Walters' in distribution list

Respondent Side

  • Beth Mulcahy (attorney)
    Mulcahy Law Firm (implied by context of letter)
    Former counsel for Respondent; wrote opinion letter dated Oct 31, 2011

Neutral Parties

  • Brian Brendan Tully (ALJ)
    Office of Administrative Hearings
    Administrative Law Judge
  • Gene Palma (Director)
    Department of Fire, Building, and Life Safety
    Agency Director
  • Cliff J. Vanell (Director)
    Office of Administrative Hearings
    Signed Certification of Decision
  • Joni Cage (staff)
    Department of Fire, Building, and Life Safety
    Care of for Gene Palma in distribution list

Jacobson III, Clayton vs. Rio Lindo Shores Homeowners Association

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Case Summary

Case ID 08F-H088016-BFS
Agency Department of Fire, Building and Life Safety
Tribunal OAH
Decision Date 2008-06-12
Administrative Law Judge Brian Brendan Tully
Outcome partial
Filing Fees Refunded $2,000.00
Civil Penalties $750.00

Parties & Counsel

Petitioner Clayton Jacobson III Counsel —
Respondent Rio Lindo Shores Homeowners Association, Inc. Counsel —

Alleged Violations

A.R.S. § 41-2198.01
A.R.S. § 33-1812

Outcome Summary

Respondent failed to appear and was deemed to have admitted to 15 violations by default. Petitioner was awarded a full refund of the $2,000 filing fee and Respondent was assessed $750 in civil penalties. Five other allegations were dismissed because they occurred prior to the enactment of the relevant jurisdictional statutes.

Why this result: Five specific allegations were dismissed because the events occurred prior to the enactment of A.R.S. § 41-2198 et seq.

Key Issues & Findings

Multiple Violations (Default Judgment)

Respondent failed to answer the petition and was deemed to have admitted to 15 validly filed violations.

Orders: Respondent ordered to abide by statutes and documents; pay $750 civil penalty ($50 per violation); refund $2,000 filing fee.

Filing fee: $2,000.00, Fee refunded: Yes, Civil penalty: $750.00

Disposition: petitioner_win

Cited:

  • A.R.S. § 41-2198.01
  • A.R.S. § 41.2198.02(A)

Voting and Record Keeping Violations (Pre-Statute)

Petitioner alleged violations regarding voting procedures, assessment recording, and reimbursements dating between 1980 and 2006.

Orders: Dismissed as untimely.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 33-1812
  • CC&R Article 9.3
  • Bylaws Article 6.2.3

Decision Documents

08F-H088016-BFS Decision – 192712.pdf

Uploaded 2026-01-25T15:23:26 (78.5 KB)





Briefing Doc – 08F-H088016-BFS


Briefing: Administrative Decision in Jacobson v. Rio Lindo Shores Homeowners Association

Executive Summary

This briefing summarizes the administrative law decision in Case No. 08F-H088016-BFS, involving Petitioner Clayton Jacobson III and Respondent Rio Lindo Shores Homeowners Association, Inc. The matter was adjudicated by the Arizona Office of Administrative Hearings following a petition alleging multiple violations of planned community statutes and governing documents.

The core outcome of the case was a default judgment against the Rio Lindo Shores Homeowners Association due to its failure to respond to official notices. As a result, the Respondent was deemed to have admitted to 15 validly filed violations. The Administrative Law Judge (ALJ) ordered the Respondent to refund the Petitioner’s $2,000.00 filing fee and pay $750.00 in civil penalties. However, five specific allegations were dismissed because they predated the enactment of the relevant enabling legislation (A.R.S. § 41-2198 et seq.).

Procedural History and Default

The administrative process followed a strict statutory timeline, which the Respondent failed to meet at every stage:

• Initial Petition: Filed by Clayton Jacobson III on April 8, 2008, with the Department of Fire, Building and Life Safety (“Department”).

• Addendum: Filed by the Petitioner on April 10, 2008.

• Official Notifications: The Department mailed a Notice of Petition on April 10, 2008, and an Amended Notice of Petition on April 14, 2008.

• Statutory Deadline: Under A.R.S. § 41-2198.01(D), the Respondent was required to submit a written response within 20 days.

• Failure to Respond: The Respondent failed to respond to both the original and the amended notices.

• Notice of Default: Issued by the Department on May 15, 2008.

Consequently, pursuant to A.R.S. § 41-2198.01(F), the Respondent’s failure to file a timely response resulted in the legal admission of the alleged violations, subject to statutory jurisdiction.

Legal Findings and Jurisdictional Limitations

The Department and the Office of Administrative Hearings operate under specific statutory authorities:

• A.R.S. § 41-2198.01: Authorizes the Department to process petitions regarding disputes between owners and planned communities.

• A.R.S. § 41-2198: Authorizes the Office of Administrative Hearings to adjudicate these disputes.

Dismissed Allegations

The ALJ identified five violations that, while admitted by default, were legally unenforceable because they occurred before the enactment of the statutes granting the Office of Administrative Hearings its adjudicative authority. These dismissed allegations included:

Date of Occurrence

Alleged Violation

Legal/Documentary Reference

March 5, 2006

Failure to provide absentee ballots or delivery methods for voting; use of proxies.

A.R.S. § 33-1812

March 4, 2006

Restricted voting rights for members who paid dues up until the annual meeting.

Bylaws Articles 6.1.12 & 9; CC&R Article 4.8

March 7, 2004

Increased annual assessment from $200 to $300 without recording at the recorder’s office.

CC&R Article 9.3

January 24, 1996

Refusal to reimburse Petitioner $125.00 for association business expenses.

Bylaws Article 6.2.3

November 1, 1980

Amended Declaration to add Bylaws without recording at the County Recorder’s Office.

CC&R Article 9.3

Admitted Violations and Penalties

Excluding the five untimely allegations, the Respondent was found liable for 15 validly filed violations. The ALJ issued the following mandates:

1. Compliance: The Respondent must abide by all statutes and community documents cited in the violations.

2. Petitioner Reimbursement: The Respondent was ordered to pay the Petitioner $2,000.00 to cover the multiple violation filing fee within 30 days.

3. Civil Penalties: The ALJ assessed a civil penalty of 50.00perviolation∗∗.With15admittedviolations,thetotalpenaltyof∗∗750.00 was ordered to be paid to the Department within 30 days.

Finality of Decision

The Order, dated June 12, 2008, constitutes the final administrative decision. Under A.R.S. § 41-2198.04(A), it is not subject to a request for rehearing. The Order is legally binding and enforceable through contempt of court proceedings pursuant to A.R.S. § 41-2198.02(B).






Study Guide – 08F-H088016-BFS


Study Guide: Jacobson v. Rio Lindo Shores Homeowners Association

This study guide provides a comprehensive review of the administrative law case Clayton Jacobson III vs. Rio Lindo Shores Homeowners Association (No. 08F-H088016-BFS). It examines the procedural history, findings of fact, legal conclusions, and the final order issued by the Office of Administrative Hearings on June 12, 2008.

——————————————————————————–

Part I: Short-Answer Quiz

Instructions: Provide a 2–3 sentence answer for each of the following questions based on the case details.

1. Identify the Petitioner and the Respondent in this case and their relationship to one another.

2. What was the initial action taken by Clayton Jacobson III on April 8, 2008, and which state department received it?

3. Describe the procedural failure of the Rio Lindo Shores Homeowners Association following the mailing of the Notice of Petition.

4. Why did the Administrative Law Judge dismiss the allegations regarding the unrecorded assessment increase from March 2004?

5. What was the specific violation alleged regarding the annual meeting held on March 5, 2006?

6. Explain the legal consequence of the Respondent’s failure to file a timely response to the Petition.

7. How many “validly filed violations” were eventually used to calculate the civil penalty, and what was the cost per violation?

8. What specific financial reimbursement did the Petitioner seek regarding a transaction from January 24, 1996, and what was the outcome?

9. Under the final Order, what is the deadline for the Respondent to pay the assessed fees and penalties?

10. What is the status of this Order regarding future appeals or rehearings according to A.R.S. § 41-2198.04(A)?

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Part II: Answer Key

1. Identify the Petitioner and the Respondent: The Petitioner is Clayton Jacobson III, who is a member of the homeowners association. The Respondent is the Rio Lindo Shores Homeowners Association, Inc., a planned community located in Parker, Arizona.

2. Initial Action and Department: On April 8, 2008, the Petitioner submitted a Petition alleging multiple complaints and violations by the Respondent. This was filed with the Department of Fire, Building and Life Safety.

3. Procedural Failure: After being mailed a Notice of Petition and an Amended Notice of Petition, the Respondent was required by A.R.S. § 41-2198.01(D) to submit a written response within 20 days. The Respondent failed to provide a response to either notice, leading to a Notice of Default.

4. Dismissal of 2004 Allegation: The allegation concerning the unrecorded assessment increase was dismissed because it occurred on March 7, 2004. This was prior to the enactment of A.R.S. § 41-2198 et seq., making the complaint untimely for the Department’s jurisdiction.

5. March 2006 Violation: The Petitioner alleged that the Respondent held an annual meeting but failed to provide absentee ballots or other delivery methods for voting. Instead, votes were cast by proxy in violation of A.R.S. § 33-1812.

6. Consequence of Failure to Respond: Under A.R.S. § 41-2198.01(F), a respondent who fails to file a timely response is deemed to have admitted the violations alleged in the Petition. This resulted in the Department issuing a Notice of Default against the association.

7. Calculation of Violations: The Respondent was found to have admitted to 15 validly filed violations. The Administrative Law Judge assessed a civil penalty of $50.00 for each of these violations.

8. 1996 Reimbursement Claim: The Petitioner alleged that on January 24, 1996, the Respondent refused to reimburse him $125.00 for expenses incurred while conducting association business. However, this claim was dismissed because the event occurred before the enactment of the governing statutes.

9. Payment Deadline: The Respondent is ordered to pay both the $2,000.00 filing fee reimbursement to the Petitioner and the $750.00 total civil penalty to the Department. These payments must be made within 30 days of the effective date of the Order.

10. Finality of the Order: Pursuant to A.R.S. § 41-2198.04(A), this Order serves as the final administrative decision. It is not subject to any requests for rehearing and is enforceable through contempt of court proceedings.

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Part III: Essay Questions

Instructions: Use the provided case facts and legal conclusions to draft comprehensive responses to the following prompts.

1. The Impact of Default in Administrative Hearings: Analyze how the Rio Lindo Shores Homeowners Association’s failure to respond to the Department’s notices dictated the legal outcome of the case. Discuss the role of A.R.S. § 41-2198.01(F) in this process.

2. Statutory Temporality and Jurisdiction: Explain why the Administrative Law Judge dismissed five specific violations despite the Respondent’s default. Focus on the significance of the enactment date of A.R.S. § 41-2198 et seq.

3. Financial Restitution and Penalties: Detail the financial obligations imposed on the Respondent. Distinguish between the multiple violation filing fee and the civil penalties, explaining to whom each is paid and why.

4. HOA Governance and Compliance: Based on the dismissed violations (Findings of Fact 8a–e), identify the various governing documents and statutes an HOA must follow, such as CC&Rs, Bylaws, and the Arizona Revised Statutes.

5. Enforcement and Finality: Discuss the finality of the Administrative Law Judge’s decision. What are the implications of the Order being “not subject to a request for rehearing,” and how can the Order be enforced if the Respondent fails to comply?

——————————————————————————–

Part IV: Glossary of Key Terms

Definition

A.R.S.

Arizona Revised Statutes; the codified laws of the state of Arizona used to regulate planned communities and administrative procedures.

Administrative Law Judge (ALJ)

A presiding official who hears evidence and issues decisions in disputes involving state agency regulations, such as those between homeowners and HOAs.

Bylaws

The internal rules and regulations that govern the daily operations and administration of an organization like a homeowners association.

Covenants, Conditions, and Restrictions; legal obligations and rules tied to the use of land within a planned community or homeowners association.

Civil Penalty

A financial fine imposed by a government agency (in this case, the Department) as a consequence for violating regulations or statutes.

Contempt of Court

A legal mechanism used to enforce an order; being found in contempt can result from failing to obey the directives of the Administrative Law Judge.

Default

A failure to fulfill a legal obligation, such as failing to file a required response to a legal petition within the specified 20-day timeframe.

Department of Fire, Building and Life Safety

The Arizona state department authorized to receive and process petitions regarding disputes in planned communities.

Office of Administrative Hearings (OAH)

The agency authorized to adjudicate petitions and disputes between owners and planned communities.

Petitioner

The party who initiates a legal action or petition (in this case, Clayton Jacobson III).

Respondent

The party against whom a legal action or petition is filed (in this case, Rio Lindo Shores Homeowners Association, Inc.).






Blog Post – 08F-H088016-BFS


Study Guide: Jacobson v. Rio Lindo Shores Homeowners Association

This study guide provides a comprehensive review of the administrative law case Clayton Jacobson III vs. Rio Lindo Shores Homeowners Association (No. 08F-H088016-BFS). It examines the procedural history, findings of fact, legal conclusions, and the final order issued by the Office of Administrative Hearings on June 12, 2008.

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Part I: Short-Answer Quiz

Instructions: Provide a 2–3 sentence answer for each of the following questions based on the case details.

1. Identify the Petitioner and the Respondent in this case and their relationship to one another.

2. What was the initial action taken by Clayton Jacobson III on April 8, 2008, and which state department received it?

3. Describe the procedural failure of the Rio Lindo Shores Homeowners Association following the mailing of the Notice of Petition.

4. Why did the Administrative Law Judge dismiss the allegations regarding the unrecorded assessment increase from March 2004?

5. What was the specific violation alleged regarding the annual meeting held on March 5, 2006?

6. Explain the legal consequence of the Respondent’s failure to file a timely response to the Petition.

7. How many “validly filed violations” were eventually used to calculate the civil penalty, and what was the cost per violation?

8. What specific financial reimbursement did the Petitioner seek regarding a transaction from January 24, 1996, and what was the outcome?

9. Under the final Order, what is the deadline for the Respondent to pay the assessed fees and penalties?

10. What is the status of this Order regarding future appeals or rehearings according to A.R.S. § 41-2198.04(A)?

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Part II: Answer Key

1. Identify the Petitioner and the Respondent: The Petitioner is Clayton Jacobson III, who is a member of the homeowners association. The Respondent is the Rio Lindo Shores Homeowners Association, Inc., a planned community located in Parker, Arizona.

2. Initial Action and Department: On April 8, 2008, the Petitioner submitted a Petition alleging multiple complaints and violations by the Respondent. This was filed with the Department of Fire, Building and Life Safety.

3. Procedural Failure: After being mailed a Notice of Petition and an Amended Notice of Petition, the Respondent was required by A.R.S. § 41-2198.01(D) to submit a written response within 20 days. The Respondent failed to provide a response to either notice, leading to a Notice of Default.

4. Dismissal of 2004 Allegation: The allegation concerning the unrecorded assessment increase was dismissed because it occurred on March 7, 2004. This was prior to the enactment of A.R.S. § 41-2198 et seq., making the complaint untimely for the Department’s jurisdiction.

5. March 2006 Violation: The Petitioner alleged that the Respondent held an annual meeting but failed to provide absentee ballots or other delivery methods for voting. Instead, votes were cast by proxy in violation of A.R.S. § 33-1812.

6. Consequence of Failure to Respond: Under A.R.S. § 41-2198.01(F), a respondent who fails to file a timely response is deemed to have admitted the violations alleged in the Petition. This resulted in the Department issuing a Notice of Default against the association.

7. Calculation of Violations: The Respondent was found to have admitted to 15 validly filed violations. The Administrative Law Judge assessed a civil penalty of $50.00 for each of these violations.

8. 1996 Reimbursement Claim: The Petitioner alleged that on January 24, 1996, the Respondent refused to reimburse him $125.00 for expenses incurred while conducting association business. However, this claim was dismissed because the event occurred before the enactment of the governing statutes.

9. Payment Deadline: The Respondent is ordered to pay both the $2,000.00 filing fee reimbursement to the Petitioner and the $750.00 total civil penalty to the Department. These payments must be made within 30 days of the effective date of the Order.

10. Finality of the Order: Pursuant to A.R.S. § 41-2198.04(A), this Order serves as the final administrative decision. It is not subject to any requests for rehearing and is enforceable through contempt of court proceedings.

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Part III: Essay Questions

Instructions: Use the provided case facts and legal conclusions to draft comprehensive responses to the following prompts.

1. The Impact of Default in Administrative Hearings: Analyze how the Rio Lindo Shores Homeowners Association’s failure to respond to the Department’s notices dictated the legal outcome of the case. Discuss the role of A.R.S. § 41-2198.01(F) in this process.

2. Statutory Temporality and Jurisdiction: Explain why the Administrative Law Judge dismissed five specific violations despite the Respondent’s default. Focus on the significance of the enactment date of A.R.S. § 41-2198 et seq.

3. Financial Restitution and Penalties: Detail the financial obligations imposed on the Respondent. Distinguish between the multiple violation filing fee and the civil penalties, explaining to whom each is paid and why.

4. HOA Governance and Compliance: Based on the dismissed violations (Findings of Fact 8a–e), identify the various governing documents and statutes an HOA must follow, such as CC&Rs, Bylaws, and the Arizona Revised Statutes.

5. Enforcement and Finality: Discuss the finality of the Administrative Law Judge’s decision. What are the implications of the Order being “not subject to a request for rehearing,” and how can the Order be enforced if the Respondent fails to comply?

——————————————————————————–

Part IV: Glossary of Key Terms

Definition

A.R.S.

Arizona Revised Statutes; the codified laws of the state of Arizona used to regulate planned communities and administrative procedures.

Administrative Law Judge (ALJ)

A presiding official who hears evidence and issues decisions in disputes involving state agency regulations, such as those between homeowners and HOAs.

Bylaws

The internal rules and regulations that govern the daily operations and administration of an organization like a homeowners association.

Covenants, Conditions, and Restrictions; legal obligations and rules tied to the use of land within a planned community or homeowners association.

Civil Penalty

A financial fine imposed by a government agency (in this case, the Department) as a consequence for violating regulations or statutes.

Contempt of Court

A legal mechanism used to enforce an order; being found in contempt can result from failing to obey the directives of the Administrative Law Judge.

Default

A failure to fulfill a legal obligation, such as failing to file a required response to a legal petition within the specified 20-day timeframe.

Department of Fire, Building and Life Safety

The Arizona state department authorized to receive and process petitions regarding disputes in planned communities.

Office of Administrative Hearings (OAH)

The agency authorized to adjudicate petitions and disputes between owners and planned communities.

Petitioner

The party who initiates a legal action or petition (in this case, Clayton Jacobson III).

Respondent

The party against whom a legal action or petition is filed (in this case, Rio Lindo Shores Homeowners Association, Inc.).


Case Participants

Petitioner Side

  • Clayton Jacobson, III (Petitioner)
    Rio Lindo Shores Homeowners Association
    Member of Respondent

Neutral Parties

  • Brian Brendan Tully (Administrative Law Judge)
    Office of Administrative Hearings
  • Robert Barger (Director)
    Department of Fire Building and Life Safety
    Recipient of decision copy
  • Debra Blake (Department Staff)
    Department of Fire Building and Life Safety
    Recipient of decision copy

Carnes, Ray -v- Casa Campa Homeowners Association

Posted on by

Case Summary

Case ID 07F-H067024-BFS
Agency DFBLS
Tribunal OAH
Decision Date 2007-04-23
Administrative Law Judge Michael K. Carroll
Outcome yes
Filing Fees Refunded $500.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Ray Carnes Counsel —
Respondent Casa Campa Homeowners Association Counsel Beth Mulcahy

Alleged Violations

A.R.S. § 41-2198.01

Outcome Summary

The parties reached a settlement agreement. The Respondent acknowledged technical violations of the governing documents and instituted procedural changes to prevent recurrence. The Respondent agreed to reimburse the Petitioner's filing fee.

Key Issues & Findings

Technical violations of governing documents

Respondent acknowledged technical violations of the governing documents and instituted procedural changes to prevent recurrence.

Orders: Respondent agreed to pay Petitioner's filing fee; Respondent acknowledged violations and instituted procedural changes.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Decision Documents

07F-H067024-BFS Decision – 166731.pdf

Uploaded 2026-01-25T15:20:07 (62.4 KB)





Briefing Doc – 07F-H067024-BFS


Administrative Hearing Briefing: Carnes v. Casa Campa Homeowners Association

Executive Summary

This briefing document details the resolution of a legal dispute between Ray Carnes (Petitioner) and the Casa Campa Homeowners Association (Respondent) adjudicated by the Arizona Office of Administrative Hearings (Case No. 07F-H067024-BFS). On April 23, 2007, a hearing presided over by Administrative Law Judge Michael K. Carroll resulted in a settlement agreement before formal testimony commenced. The Respondent acknowledged technical violations of Association governing documents and implemented procedural changes to ensure future compliance. The matter concluded with an order for the Respondent to reimburse the Petitioner’s filing fee and the cessation of all claims within the petition.

Case Overview and Proceedings

The administrative hearing was convened to address allegations brought by Ray Carnes against the Casa Campa Homeowners Association. The proceedings were characterized by a shift from litigation to mediation at the outset of the scheduled hearing.

Case Metadata

Element

Detail

Case Number

07F-H067024-BFS

Petitioner

Ray Carnes (Pro se)

Respondent

Casa Campa Homeowners Association

Legal Counsel (Respondent)

Beth Mulcahy, Mulcahy Law Firm, PC

Presiding Judge

Michael K. Carroll, Administrative Law Judge

Hearing Date

April 23, 2007

Office of Administrative Hearings, Phoenix, Arizona

Settlement and Resolution Terms

At the commencement of the April 23 hearing, both parties requested a conference to discuss a potential settlement. This conference successfully resulted in a mutual agreement that was memorialized on the record, effectively resolving the dispute without the need for a full evidentiary hearing.

Key Provisions of the Agreement

The settlement comprised three primary components that addressed the Petitioner’s grievances and provided a framework for future operational compliance by the Association:

1. Acknowledgment of Violations: The Respondent acknowledged that the Petition alleged “technical violations” of the documents governing the Homeowners Association.

2. Procedural Remedies: To address these violations, the Respondent reported that it had already “instituted procedural changes” designed to prevent any recurrence of the issues raised in the Petition.

3. Release of Claims: In exchange for the procedural changes and the reimbursement of costs, the Petitioner acknowledged he would not proceed further with any allegations against the Respondent related to the Petition.

Final Administrative Order

Following the memorialization of the settlement, the Administrative Law Judge issued a formal order to close the matter and ensure the financial terms were met.

Judicial Mandates

• Conclusion of Matters: The Judge ordered that all matters subject to the Petition were officially concluded.

• Reimbursement of Fees: Under the authority of A.R.S. § 41-2198.01, the Respondent was ordered to pay the Petitioner’s filing fee.

Involved Entities and Contact Information

The final decision was transmitted to the following individuals and agencies involved in the administrative process:

• Robert Barger, Director: Department of Fire Building and Life Safety (Attn: Joyce Kesterman).

• Ray Carnes: Ray Carnes Enterprises, Glendale, Arizona.

• Beth Mulcahy, Esq.: Mulcahy Law Firm, PC, Phoenix, Arizona.






Study Guide – 07F-H067024-BFS


Administrative Law Study Guide: Carnes v. Casa Campa Homeowners Association

This study guide provides a comprehensive review of the administrative proceedings and settlement reached in the matter of Ray Carnes vs. Casa Campa Homeowners Association. The materials are based on the official decision issued by the Office of Administrative Hearings in Phoenix, Arizona.

Section 1: Short-Answer Quiz

Instructions: Answer the following questions in 2–3 sentences based on the provided source context.

1. Who were the primary parties involved in case No. 07F-H067024-BFS?

2. What was the official role of Michael K. Carroll in these proceedings?

3. How did the parties resolve the dispute at the start of the hearing?

4. What did the Respondent acknowledge concerning the allegations in the Petition?

5. What proactive steps did the Homeowners Association take to prevent future issues?

6. What specific financial restitution was the Respondent ordered to provide?

7. What did the Petitioner, Ray Carnes, agree to as part of the settlement terms?

8. Which Arizona Revised Statute was cited regarding the payment of the filing fee?

9. Who provided legal representation for the Respondent during the hearing?

10. What was the final status of the matters that were the subject of the Petition?

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Section 2: Answer Key

Question

Answer

The Petitioner was Ray Carnes, appearing on his own behalf. The Respondent was the Casa Campa Homeowners Association.

Michael K. Carroll served as the Administrative Law Judge (ALJ) for the Office of Administrative Hearings. He presided over the hearing and issued the final decision memorializing the settlement.

At the commencement of the hearing, the parties requested a conference to discuss a possible settlement. Following this conference, they reached an agreement that was memorialized on the record.

The Respondent acknowledged that the Petition alleged technical violations of the documents governing the Association. These allegations were addressed through the subsequent settlement agreement.

The Respondent instituted procedural changes designed to prevent a recurrence of the technical violations. This action was taken prior to or as part of the settlement reaching its final form.

The Respondent was ordered to pay the Petitioner’s filing fee. This requirement was explicitly stated in the ALJ’s final order.

The Petitioner acknowledged that because of the agreement reached, he would not proceed further against the Respondent. This applied to all allegations contained within the original Petition.

The filing fee was required and ordered pursuant to A.R.S. § 41-2198.01. This statute governs the financial obligations regarding the initiation of the administrative matter.

The Casa Campa Homeowners Association was represented by Beth Mulcahy, an attorney from the Mulcahy Law Firm, PC.

The Administrative Law Judge ordered that all matters which were the subject of the Petition were concluded. This finalized the agency action regarding the dispute.

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Section 3: Essay Questions

Instructions: Use the provided source context to develop comprehensive responses to the following prompts.

1. The Role of Mediation in Administrative Law: Analyze the process by which the parties moved from a scheduled hearing to a settlement conference. Discuss how this process facilitates the resolution of disputes without the need for a full evidentiary hearing.

2. Accountability and Procedural Reform: Examine the Respondent’s decision to institute procedural changes in response to alleged technical violations. Evaluate how such changes serve as a remedy in administrative disputes between homeowners and associations.

3. Legal Representation and Pro Se Petitioners: Compare the representation of the two parties in this case. Discuss the implications of a Petitioner appearing “on his own behalf” versus a Respondent appearing with professional legal counsel.

4. The Finality of ALJ Decisions: Discuss the significance of the phrase “ALJ Decision final by statute” and the judge’s order that all matters are “hereby concluded.” What does this suggest about the binding nature of settlements reached in the Office of Administrative Hearings?

5. Financial Burdens in Administrative Petitions: Using the case as a reference, discuss the importance of A.R.S. § 41-2198.01 regarding filing fees. Why is the reimbursement of these fees a critical component of the settlement reached between Carnes and the Association?

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Section 4: Glossary of Key Terms

• A.R.S. § 41-2198.01: The specific Arizona Revised Statute governing the filing fees and potentially other procedural requirements for matters brought before this administrative body.

• Administrative Law Judge (ALJ): A presiding officer (in this case, Michael K. Carroll) who conducts hearings and issues decisions for an administrative agency.

• Appearances: The formal record of the individuals present at the hearing and whom they represent (e.g., Ray Carnes for himself, Beth Mulcahy for the Respondent).

• Governing Documents: The legal instruments (such as bylaws or declarations) that dictate the rules and operations of the Casa Campa Homeowners Association.

• Memorialized on the Record: The act of formally recording the terms of an agreement or statement so that it becomes part of the official legal transcript and history of the case.

• Office of Administrative Hearings: The Arizona state agency responsible for conducting independent and impartial hearings for administrative disputes.

• Petition: The formal document filed by the Petitioner (Ray Carnes) to initiate the legal process and outline allegations against the Respondent.

• Petitioner: The party who initiates the legal action or appeal (Ray Carnes).

• Respondent: The party against whom a petition is filed or an action is brought (Casa Campa Homeowners Association).

• Technical Violations: Specific failures to adhere to the exact procedural or administrative requirements set forth in the association’s governing documents.






Blog Post – 07F-H067024-BFS


The Settlement Strategy: How a Pro Se Homeowner Outmaneuvered His HOA

The tension was palpable at the Office of Administrative Hearings when Ray Carnes, appearing “on his own behalf,” stood his ground against a professional attorney from the Mulcahy Law Firm. While many homeowners fear that a legal battle against an HOA is a David vs. Goliath mismatch, the case of Ray Carnes vs. Casa Campa Homeowners Association proves that procedural savvy can level the playing field. This 2007 dispute offers a masterclass in how a homeowner can leverage the administrative process to force systemic accountability without ever needing a final trial verdict.

### 2. Takeaway 1: The “Courthouse Steps” Resolution

At the very commencement of the scheduled hearing, the parties made a strategic pivot by requesting a conference with the Administrative Law Judge (ALJ) to discuss a settlement. This maneuver allowed the ALJ to serve as a mediator, facilitating a pragmatic agreement that avoided the risks and costs of a formal ruling. For the HOA, settling is often an “inside baseball” tactic to avoid a published Final Decision that could set a binding legal precedent for the entire community.

### 3. Takeaway 2: Technical Violations Lead to Systemic Change

A key tactical nuance in this settlement was the HOA’s acknowledgment that violations had been alleged, rather than admitting to specific guilt—a common “no-fault” strategy in legal resolutions. However, the real victory for Carnes was the revelation that the Association had already instituted procedural changes to prevent these issues from happening again. By forcing the HOA to correct its behavior before the hearing even began, the petitioner achieved a systemic win that is far more impactful than a simple apology or a one-time ruling.

### 4. Takeaway 3: The Cost of Accountability (The Filing Fee)

Accountability in these hearings is often cemented by the “fee-shifting” mechanism found in A.R.S. § 41-2198.01, which allows the successful party to recover their costs. Even though the case was settled, the ALJ specifically ordered the Respondent to pay Carnes’ filing fee, ensuring the homeowner was “made whole” financially. For a pro se petitioner, securing this reimbursement against a professional law firm is a significant validation of the merits of the case and a tangible reminder that HOAs are financially responsible for their procedural lapses.

### 5. Conclusion: A Blueprint for Resolution

The resolution of Carnes vs. Casa Campa provides a clear blueprint for any homeowner seeking to reform their community’s governance: prioritize procedural change and financial restitution over prolonged litigation. By focusing on “technical” compliance and using the ALJ conference as a mediation tool, you can secure meaningful reforms that outlast any single dispute. Is your own community’s board adhering to its governing documents, or could a focused demand for technical compliance be the key to the better governance you deserve?


Case Participants

Petitioner Side

  • Ray Carnes (Petitioner)
    Ray Carnes Enterprises
    Appeared on his own behalf

Respondent Side

  • Beth Mulcahy (Attorney)
    Mulcahy Law Firm, PC
    Attorney for Respondent

Neutral Parties

  • Michael K. Carroll (Administrative Law Judge)
    Office of Administrative Hearings
  • Robert Barger (Director)
    Department of Fire Building and Life Safety
    Listed on distribution list
  • Joyce Kesterman (Agency Staff)
    Department of Fire Building and Life Safety
    Listed on distribution list (ATTN)

Orange Grove Mobile Estates Homeowners Association

Posted on by

Case Summary

Case ID 07F-H067001-BFS
Agency Department of Fire, Building and Life Safety
Tribunal Office of Administrative Hearings
Decision Date 2007-01-08
Administrative Law Judge Brian Brendan Tully
Outcome no
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner W. Douglas Stickler Counsel —
Respondent Orange Grove Mobile Estates Homeowners Association Counsel Tanis A. Duncan

Alleged Violations

1987 Declaration

Outcome Summary

The Administrative Law Judge denied the petition, concluding that the 1987 Declaration's age restriction (5 years max) applied to the Petitioner's replacement home. The ALJ rejected the argument that 'accrued rights' allowed Petitioner to operate under the superseded 1971 Declaration. The HOA's denial of a hardship variance was not an abuse of discretion.

Why this result: Petitioner failed to obtain prior approval and the replacement home violated the age restrictions in the valid 1987 Declaration. The ALJ found the HOA consistently applied these rules.

Key Issues & Findings

Denial of replacement mobile home based on age restriction

Petitioner sought to replace his mobile home with one older than five years. Respondent denied the request based on the 1987 Declaration age restriction. Petitioner argued the 'rights accrued' clause in the 1987 Declaration preserved his rights under the 1971 Declaration.

Orders: Petitioner's Petition is denied.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 41-2198.01
  • A.R.S. § 41-2198.02

Video Overview

Audio Overview

Decision Documents

07F-H067001-BFS Decision – 159314.pdf

Uploaded 2026-01-23T17:16:49 (100.6 KB)





Briefing Doc – 07F-H067001-BFS


Briefing Document: Stickler v. Orange Grove Mobile Estates Homeowners Association

Executive Summary

This briefing document analyzes the administrative law decision in the matter of W. Douglas Stickler v. Orange Grove Mobile Estates Homeowners Association (No. 07F-H067001-BFS). The case centers on a dispute regarding the age restrictions for replacement mobile homes within the Orange Grove Mobile Estates (OGME) subdivision.

The Petitioner, W. Douglas Stickler, sought to replace his 30-year-old mobile home with an 11-year-old model, despite a 1987 Declaration requiring newly installed homes to be no more than five years old. The Petitioner argued that his rights under a previous 1971 Declaration—which contained no age limits—were “accrued rights” that exempted him from the newer restriction.

The Administrative Law Judge (ALJ) ruled in favor of the Respondent (the HOA), concluding that the 1987 Declaration superseded the 1971 version and that the Petitioner was subject to the five-year age limit. The ALJ further determined that the HOA did not abuse its discretion in denying a hardship variance, as it had consistently enforced the age restriction for all members.

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Regulatory Framework and Governing Declarations

The property in question (Lots 138 and 139 of Orange Grove Mobile Estates) has been subject to two primary sets of covenants, conditions, and restrictions (CC&Rs) over time.

The 1971 Declaration

• Age Limits: Contained no specific age limitations for mobile homes affixed to a homeowner’s property.

• Approval Process: Required that no building or improvement (including mobile homes) be commenced or maintained until plans and specifications were approved in writing by the Trustee (then Stewart Title & Trust).

The 1987 Declaration

In 1987, a majority of lot owners approved a new Declaration that revoked and superseded the 1971 restrictions. Key provisions include:

• Age Restriction: Any newly installed or replacement mobile home must not be more than five years of age at the time of installation.

• Architectural Control Committee: Established a “Committee” to approve construction plans, specifications, and plot plans to ensure harmony with use restrictions.

• Hardship Variances: Paragraph 4.04(c) grants the Committee “sole discretion” to provide reasonable hardship variances from restrictions, subject to county codes and zoning.

• Recital Language: Stated that previous declarations were revoked “except as to… contracts made or rights accrued under the foregoing declarations.”

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Chronology of the Dispute

The conflict arose when the Petitioner attempted to replace a failing structure on his property in 2006.

Sept 12, 1995

Petitioner sought and received prior approval for a carport, demonstrating knowledge of the 1987 Declaration’s approval requirements.

June 29, 2006

Petitioner requested permission to replace his mobile home but did not disclose the age of the new unit.

July 6, 2006

The Committee notified Petitioner that the plans were not approved because the replacement home was older than five years.

July 7, 2006

Petitioner requested a hardship waiver, admitting he was unaware of the age restriction and had already paid for the replacement home.

July 12, 2006

HOA President Charles Rucker formally denied the plot plan, noting the replacement home was 11 years old.

July 29, 2006

Petitioner argued the “accrued rights” clause in the 1987 Declaration “grandfathered” his right to install a home of any age.

Dec 18, 2006

Administrative hearing held before ALJ Brian Brendan Tully.

——————————————————————————–

Analysis of Petitioner’s Claims

The Petitioner provided four primary justifications for a hardship variance and one primary legal argument regarding his right to bypass the age restriction.

Hardship Justifications

1. Financial Risk: Most of the Petitioner’s savings had already been spent on the replacement home, and they were under contract to transfer their current home, leading to potential homelessness.

2. Financial Limitation: Ongoing medical expenses and health issues prevented the purchase of a newer home that would meet the five-year requirement.

3. Structural Necessity: The existing 30-year-old home had compromised structural integrity due to water damage (main waterline replacement), electrical issues, and termite damage.

4. Aesthetics: The Petitioner claimed the exterior appearance of the 11-year-old replacement was appropriate for the neighborhood and not detrimental.

The “Accrued Rights” Argument

Petitioner opined that the 1987 Declaration’s language regarding “rights accrued” meant his right to bring in any age replacement home (as permitted in 1971) was preserved. He argued that the 1987 restrictions should only apply to homeowners who purchased property after the 1987 Declaration was recorded.

——————————————————————————–

Legal Conclusions and Judicial Reasoning

The ALJ’s decision was based on several key legal interpretations:

• Supersedure: The 1987 Declaration, having been approved by a majority of homeowners, legally superseded the 1971 Declaration. The Petitioner is bound by the 1987 provisions regarding replacement homes.

• Interpretation of “Accrued Rights”: The ALJ rejected the Petitioner’s interpretation of the “accrued rights” recital. The court found that “accrued rights” meant Petitioner did not have to remove his existing home when the 1987 rules took effect, but it did not grant a perpetual right to ignore future replacement standards.

• Intent of the Declaration: The ALJ noted that the Petitioner’s interpretation would render the 1987 Declaration ineffective for all existing residents, which was clearly not the intent of the majority of homeowners who approved it.

• Procedural Failure: The Petitioner failed to obtain Committee approval prior to purchasing the replacement home, a requirement present in both the 1971 and 1987 Declarations.

• Consistency of Enforcement: The Respondent provided credible evidence that it has consistently denied permission to all homeowners seeking to replace homes with units older than five years. Therefore, the denial was not an abuse of discretion.

——————————————————————————–

Final Order

On January 8, 2007, Administrative Law Judge Brian Brendan Tully ordered that the Petitioner’s Petition be denied.

Under A.R.S. § 41-2198.02(B), this order constitutes the final administrative decision and is not subject to a request for rehearing. The matter was handled through the Office of Administrative Hearings following a referral from the Department of Fire, Building and Life Safety.






Study Guide – 07F-H067001-BFS


Study Guide: Stickler v. Orange Grove Mobile Estates Homeowners Association

This study guide provides a comprehensive overview of the administrative legal case between W. Douglas Stickler and the Orange Grove Mobile Estates Homeowners Association. It explores the conflict between successive property declarations, the interpretation of “accrued rights,” and the authority of homeowners’ associations to enforce age restrictions on replacement structures.

——————————————————————————–

Short-Answer Quiz

Instructions: Answer the following questions in two to three sentences based on the provided source context.

1. Who are the primary parties involved in this administrative hearing?

2. What was the central requirement regarding mobile home age introduced in the 1987 Declaration?

3. How did the 1971 Declaration differ from the 1987 Declaration regarding mobile home age limits?

4. What role does the “Committee” play according to the 1987 Declaration?

5. What evidence was cited to prove that the Petitioner was aware of the requirements of the 1987 Declaration prior to the 2006 dispute?

6. On what grounds did W. Douglas Stickler request a hardship waiver for his replacement home?

7. What was the Petitioner’s legal argument regarding the “grandfather clause” or “accrued rights”?

8. How did the Board of Directors interpret the “rights accrued” language in the 1987 Declaration?

9. What was the Administrative Law Judge’s ruling regarding the Petitioner’s interpretation of the 1987 Declaration?

10. Why did the judge conclude that the Respondent did not abuse its discretion in denying the hardship variance?

——————————————————————————–

Answer Key

1. Parties: The Petitioner is W. Douglas Stickler, a property owner in the Orange Grove Mobile Estates. The Respondent is the Orange Grove Mobile Estates Homeowners Association, an Arizona non-profit corporation represented by counsel.

2. 1987 Age Requirement: The 1987 Declaration mandated that any newly installed or replacement mobile home must not be more than five years of age at the time of installation. It also stipulated that plans must be approved in writing by the Architectural Control Committee before any replacement occurs.

3. Comparison of Declarations: The 1971 Declaration contained no specific age limitation for mobile homes affixed to a homeowner’s property. In contrast, the 1987 Declaration, which superseded the 1971 version, introduced the strict five-year age limit for all new installations and replacements.

4. The Committee: The “Committee” refers to the Architectural Control Committee, which is responsible for approving construction plans and specifications to ensure harmony with use restrictions. It also holds the “sole discretion” to grant reasonable hardship variances from the restrictions if good cause is shown.

5. Prior Compliance: In September 1995, the Petitioner wrote to the Committee seeking permission to erect a carport before beginning work. This action demonstrated his knowledge of and compliance with the 1987 Declaration’s requirement for obtaining prior approval for property improvements.

6. Hardship Grounds: Stickler cited financial inability to afford a newer home due to medical expenses, the compromised structural integrity of his current 30-year-old home (water/termite damage), and the fact that he had already paid for the 11-year-old replacement home. He also argued that the replacement home’s appearance was appropriate for the neighborhood.

7. Accrued Rights Argument: The Petitioner argued that because the 1987 Declaration included a recital stating that prior declarations were revoked “except as to… rights accrued,” his right to install a replacement home of any age (per the 1971 rules) was preserved. He believed the new restrictions should only apply to subsequent purchasers of the property.

8. Board Interpretation: The Board’s counsel argued that “rights accrued” meant that the Petitioner was not required to remove his existing mobile home just because it was older than five years when the 1987 Declaration took effect. However, it did not grant him a permanent right to ignore the age restriction for future replacement homes.

9. ALJ Ruling on Accrued Rights: The Administrative Law Judge concluded that the “accrued rights” recital did not grant a retained right to ignore the 1987 age restrictions. The judge noted that the Petitioner’s interpretation would effectively prevent the 1987 Declaration from superseding the 1971 version for all current owners, which was not the intent of the majority of homeowners who approved it.

10. Abuse of Discretion: The judge found no abuse of discretion because the Association provided evidence that it consistently denied requests for variances regarding the five-year age limit. Therefore, the denial of Stickler’s request was a uniform application of the rules rather than an arbitrary decision.

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Essay Questions

Instructions: Use the case details to develop comprehensive responses to the following prompts.

1. The Evolution of Property Restrictions: Analyze the transition from the 1971 Declaration to the 1987 Declaration. Discuss the legal implications of a majority of homeowners voting to supersede old covenants and how this affects individual “accrued rights” versus collective community standards.

2. The Burden of Compliance: Examine the Petitioner’s failure to seek approval before purchasing the replacement mobile home. How did his 1995 request for a carport influence the judge’s assessment of his “knowledge and compliance,” and why is prior approval a critical component of HOA governance?

3. Interpreting Hardship and Discretion: Discuss the criteria for a “hardship variance” as outlined in the 1987 Declaration. In your opinion, based on the text, where should a committee draw the line between personal financial difficulty and the enforcement of community age standards?

4. The Legal Definition of “Grandfathering”: Critique the Petitioner’s argument that he was “grandfathered” into the 1971 rules. Contrast his view—that the 1987 rules only apply to subsequent purchasers—with the ALJ’s view that such an interpretation would render the new Declaration ineffective.

5. Consistency in Governance: The ALJ noted that the Respondent “consistently denied” similar variance requests. Explain why consistency is a vital defense for a homeowners’ association when facing allegations of abuse of discretion or unfair treatment.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

A presiding officer who conducts hearings and issues decisions in administrative law cases, such as those involving state agencies and homeowners’ associations.

A.R.S. § 41-2198.01

The Arizona Revised Statute under which the Petitioner filed his case with the Department of Fire, Building and Life Safety.

Architectural Control Committee

The body established by the Declaration to review and approve or deny plans for buildings, improvements, or replacements within the subdivision.

Declaration of Restrictions

A legal document recorded with the county that outlines the rules, covenants, and conditions governing the use of property within a specific development.

Hardship Variance

A discretionary waiver of specific rules or restrictions granted by a governing committee when a property owner demonstrates “good cause” or significant personal difficulty.

Joint Tenants with Rights of Survivorship

A form of legal co-ownership of property where, upon the death of one owner, their interest automatically passes to the surviving owner(s).

Preponderance of the Evidence

The standard of proof in this civil matter, requiring the Petitioner to prove that his claims are more likely true than not.

Respondent

The party against whom a petition is filed; in this case, the Orange Grove Mobile Estates Homeowners Association.

Supersede

To replace or take the place of an earlier set of rules or documents; the 1987 Declaration superseded the 1971 Declaration.

Trustee

In the context of the 1971 Declaration, the entity (Stewart Title & Trust) responsible for approving initial plans for the benefit of the developer.






Blog Post – 07F-H067001-BFS


The “Grandfather Clause” Trap: 4 Crucial Lessons from a Modern HOA Legal Battle

Imagine a homeowner’s nightmare: your 30-year-old residence is literally crumbling. Termites have hollowed the wood, and a main waterline break has caused extensive water damage, compromising the structural integrity of your sanctuary. For W. Douglas Stickler, a resident of Orange Grove Mobile Estates, this wasn’t a hypothetical—it was a perceived necessity. Yet, when he attempted to replace his failing home, he found himself trapped between the decay of his property and the rigid machinery of a homeowners association.

The case of Stickler v. Orange Grove Mobile Estates serves as a stark warning. It is a masterclass in how “accrued rights” are often misunderstood and how procedural negligence can strip a homeowner of their leverage. As an advocate for homeowner rights, I see this as a cautionary tale: in the world of common-interest developments, what you don’t know—or what you assume is “grandfathered in”—can leave you homeless.

Takeaway 1: “Accrued Rights” Protect What You Have, Not What You Want

A central pillar of Stickler’s legal argument was the concept of “accrued rights.” He purchased his property while a 1971 Declaration was in effect—a document that placed no age limits on mobile homes. When a 1987 Declaration was recorded, it imposed a strict five-year age limit on any replacement homes. Stickler pointed to a specific clause in the 1987 update stating that previous restrictions were revoked: “…except as to…contracts made or rights accrued under the foregoing declarations.”

Stickler argued that his right to bring in a replacement home of any age was “grandfathered” under that 1971 document. However, the Administrative Law Judge (ALJ) delivered a sharp clarification of the law: An accrued right protects the status quo, not a future deviation.

The judge ruled that “accrued rights” protected the home already sitting on the lot in 1987, ensuring Stickler didn’t have to remove his then-existing home. It did not grant him a permanent, transferable license to ignore new standards when bringing in a “new” structure. Most importantly, the ALJ noted in Conclusion of Law #6 that if Stickler’s interpretation were true, the 1987 rules would only apply to subsequent purchasers. This was “clearly not the intent” of the majority of homeowners who voted for the change. In an HOA, majoritarian rule can, and often does, strip away your existing expectations for future use.

Takeaway 2: The Fatal Strategy of “Buying Before Approving”

In HOA disputes, hope is not a strategy. Stickler’s most significant procedural failure was his “act first, ask later” approach. By the time he officially requested permission from the Architectural Control Committee (ACC) on June 29, 2006, he was already under contract for an 11-year-old replacement home. In his letter, he pressured the committee for a rapid response, noting he expected his Pima County permit within “7-10 days.”

This narrow window left the HOA with no room to deliberate and Stickler with no room to pivot. The ALJ highlighted a critical piece of evidence: in 1995, Stickler had successfully sought prior written approval to erect a carport. This established “actual notice.” Stickler knew the rules required prior approval; he simply chose not to follow them for the home replacement.

The lesson here is absolute: Never commit capital before you have a signed approval. The judge concluded that Stickler failed to obtain approval “prior to purchasing” as required by both the 1971 and 1987 declarations. By the time the HOA said no, Stickler’s money was already gone.

Takeaway 3: Hardship is Subjective (and Legally Fragile)

When his request was denied because the 11-year-old replacement home exceeded the five-year age limit, Stickler appealed for a “Hardship Waiver.” He cited a trifecta of personal crises: financial inability to buy a newer home due to ongoing medical expenses, the “compromised structural integrity” of his current 30-year-old home, and the threat of imminent homelessness.

In a poignant plea, Stickler wrote:

“We are between a rock and a hard place and could literally be homeless. Most of our savings has already paid for the replacement home. We are under contract for the transfer of ownership of our present home.”

While empathetic on the surface, the HOA Board and the ALJ remained unmoved. HOA President Charles Rucker pointed out the hard truth: Stickler “should have discussed the matter with the Committee prior to his purchasing” the home. The court ultimately found that the Board did not “abuse its discretion” by denying the waiver. Personal financial choices and maintenance issues do not legally obligate an association to compromise the standards the majority of the community voted to uphold.

Takeaway 4: Uniform Enforcement is the HOA’s Strongest Shield

Stickler’s case hit a brick wall because the HOA had a history of saying “no.” The court found credible evidence that the Association had “consistently denied member homeowners permission to replace their homes with homes older than five years.”

This is a vital takeaway for any homeowner looking to challenge a board. If an HOA enforces a rule inconsistently, they are vulnerable to claims of being “arbitrary and capricious.” However, if they are consistently rigid, that rigidity becomes a legally protected standard. By uniformly applying the 1987 age limit, the Board shielded itself from the charge of “abuse of discretion.” Consistency effectively turns a board’s refusal into a predictable, and therefore legally sound, application of the law.

Conclusion: The Long Shadow of the 1987 Declaration

The 1987 Declaration did more than just change the rules; it fundamentally reshaped the community’s governance, shifting power from a “Trustee” (Stewart Title & Trust) to a member-run “Committee.” It even removed certain properties from the original plat, fundamentally shifting the ground beneath the residents’ feet.

The final order was clear: the 1987 Declaration is the law of the land for Orange Grove Mobile Estates. It serves as a reminder that when you buy into a community, you are not just signing up for the rules as they exist on the day you close escrow. You are signing up for a living document that can evolve—and potentially become more restrictive—through the will of the majority.

Before you make your next move, ask yourself: Are you prepared for the rules to change tomorrow, and do you have the procedural discipline to navigate them? In the battle between a homeowner’s “Golden Years” and an HOA’s CC&Rs, the ink on the declaration almost always wins.


Case Participants

Petitioner Side

  • W. Douglas Stickler (Petitioner)
    Homeowner
    appeared personally
  • Patricia Ronell Stickler (Joint Owner)
    Homeowner
    Petitioner's wife

Respondent Side

  • Tanis A. Duncan (Respondent Attorney)
    Law Office of Tanis A. Duncan
    Represented the Association
  • Charles Rucker (Board President)
    Orange Grove Mobile Estates Homeowners Association
    President of the association

Neutral Parties

  • Brian Brendan Tully (ALJ)
    Office of Administrative Hearings
    Administrative Law Judge
  • Gene E. Anderson (Beneficiary)
    Stewart Title & Trust (Trustee)
    Historical context (1971 Declaration)
  • Robert Barger (Agency Director)
    Department of Fire Building and Life Safety
    Director receiving copy of decision
  • Joyce Kesterman (Agency Staff)
    Department of Fire Building and Life Safety
    Receiving copy of decision