Case Summary
| Case ID | 19F-H1918022-REL-RHG |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2019-05-10 |
| Administrative Law Judge | Thomas Shedden |
| Outcome | loss |
| Filing Fees Refunded | $0.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Tom J Martin | Counsel | — |
|---|---|---|---|
| Respondent | SaddleBrooke Home Owners Association #1, Inc. | Counsel | Carolyn B. Goldschmidt |
Alleged Violations
ARIZ. REV. STAT. § 32-2199.01(A); ARIZ. REV. STAT. § 33-1802(2)
Outcome Summary
The petition was dismissed because the Administrative Law Judge determined that the alleged violations of the HOA's website and policy manual did not involve 'community documents' as defined by statute, meaning the matter did not fall within the tribunal's jurisdiction under ARIZ. REV. STAT. § 32-2199.01(A).
Why this result: The petition was dismissed because the initial claims did not meet the requirements of ARIZ. REV. STAT. § 32-2199.01(A), as the alleged violations involved documents (website and policy BC-3) that are not considered 'community documents' under ARIZ. REV. STAT. § 33-1802(2).
Key Issues & Findings
Alleged violation of HOA website and Policy BC-3 concerning the provision of pickleball courts
Petitioner alleged the HOA violated its website and Policy Manual (BC-3) regarding the provision of pickleball courts. Respondent filed a Motion to Dismiss, arguing the Department lacked jurisdiction because neither the website nor Policy BC-3 are defined as 'community documents' under ARIZ. REV. STAT. § 33-1802(2). The ALJ agreed, finding the claim failed to meet the jurisdictional requirements of ARIZ. REV. STAT. § 32-2199.01(A).
Orders: Petitioner Tom J. Martin’s petition is dismissed.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
- ARIZ. REV. STAT. § 32-2199.01(A)
- ARIZ. REV. STAT. § 33-1802(2)
- ARIZ. REV. STAT. § 32-2199.02
Analytics Highlights
- ARIZ. REV. STAT. § 32-2199.01
- ARIZ. REV. STAT. § 33-1802
- ARIZ. REV. STAT. § 32-2199.02
- Walker v. Scottsdale
- McNally v. Sun Lakes Homeowners Ass’n #1, Inc.
Video Overview
Audio Overview
Decision Documents
19F-H1918022-REL-RHG Decision – 704322.pdf
Briefing Document: Martin v. SaddleBrooke Home Owners Association #1, Inc. (Case No. 19F-H1918022-REL-RHG)
Executive Summary
This document synthesizes the Administrative Law Judge Decision in the case of Tom J. Martin versus SaddleBrooke Home Owners Association #1, Inc., which resulted in the dismissal of the petitioner’s case. The decision, issued on May 10, 2019, centered on a critical jurisdictional question: whether an HOA’s website content and internal policy manual constitute “community documents” under Arizona state law.
The Administrative Law Judge (ALJ) concluded they do not. The petitioner’s claim, which alleged the HOA failed to provide pickleball courts as promised on its website and in its “Policy Number BC-3,” was dismissed because it did not allege a violation of a legally recognized “community document.” According to Arizona Revised Statutes, such documents are strictly defined as the declaration, bylaws, articles of incorporation, and formally adopted rules. As the petitioner’s initial filing cited only the website and a policy not adopted as a rule, the Office of Administrative Hearings lacked the statutory jurisdiction to hear the case. Furthermore, the ALJ determined that the petitioner’s requested relief—a financial award of $463,112 or the construction of eight new courts—was beyond the scope of the tribunal’s authority.
Case Overview
Case Name
Tom J. Martin v. SaddleBrooke Home Owners Association #1, Inc.
Case Number
19F-H1918022-REL-RHG
Tribunal
Arizona Office of Administrative Hearings
Petitioner
Tom J. Martin
Respondent
SaddleBrooke Home Owners Association #1, Inc.
Presiding Judge
Administrative Law Judge Thomas Shedden
Date of Decision
May 10, 2019
Petitioner’s Core Allegations and Requested Relief
The petition filed by Tom J. Martin on September 28, 2018, was founded on the central allegation that the SaddleBrooke HOA violated its own website content and its internal policy manual, specifically “Policy Number BC-3.”
• Primary Allegation: The HOA failed to fulfill its advertised and marketed promise to provide pickleball courts.
• Cited Violations: In the initial petition, Martin explicitly alleged violations of the HOA’s website and policy manual. While he checked boxes on the petition form indicating violations of the CC&Rs and Bylaws, he failed to identify any specific provisions from those documents.
• Requested Relief: The petitioner sought a significant remedy from the HOA, requesting one of the following:
1. Financial support in the amount of $463,112.00 for the expansion of pickleball courts in Bobcat Canyon.
2. The provision of eight new pickleball courts within a two-mile radius of the community within one year.
3. A commitment from the HOA to be financially responsible for the maintenance of pickleball courts in an amount equal to its spending on eight tennis courts.
Procedural History and Key Arguments
The case progressed through several key stages, culminating in a rehearing and a final dismissal.
1. Initial Petition (September 28, 2018): Mr. Martin filed his single-issue petition with the Arizona Department of Real Estate.
2. Respondent’s Motion to Dismiss (November 30, 2018): The HOA argued that the Department of Real Estate lacked jurisdiction over the matter. Its core argument was that hearings under ARIZ. REV. STAT. § 32-2199.01 are limited to violations of “community documents,” and that a website and an internal policy do not meet the legal definition of such documents. The HOA also contended the requested relief was outside the tribunal’s authority.
3. Petitioner’s Response (December 4, 2018): In his response, Mr. Martin argued that a “policy” should be interpreted as a “rule” under its ordinary meaning. He further asserted that another HOA policy (CE-3) defined “governing documents” to include “Rules and Regulations,” and therefore Policy BC-3 should be considered a governing document.
4. Initial Dismissal (December 12, 2018): The ALJ dismissed the petition, finding that it had not alleged a violation meeting the statutory requirements.
5. Request for Rehearing (December 31, 2018): Mr. Martin requested a rehearing, reasserting that a “policy” is a “rule.” In this request, he newly alleged that the HOA had violated specific provisions: Bylaws article 4, section 6(3) and Articles of Incorporation Article XII, by failing to implement policy BC-3.
6. Rehearing (April 16, 2019): A rehearing was conducted where both parties presented their cases. The respondent renewed its argument regarding lack of jurisdiction.
Central Legal Dispute: The Definition of “Community Documents”
The determinative issue of the case was the precise legal definition of “community documents” and whether the petitioner’s claims fell within that scope.
• Statutory Definition: The court’s decision was anchored in ARIZ. REV. STAT. § 33-1802(2), which defines community documents as:
◦ The declaration (CC&Rs)
◦ Bylaws
◦ Articles of incorporation, if any
◦ Rules, if any
• The Court’s Finding: The ALJ concluded that this legislative definition is exclusive and does not include “a planned community’s statements of policy, statements on its website, or advertising and marketing material.”
• Petitioner’s Argument Rejected: Mr. Martin’s argument that Policy BC-3 should be considered a rule was found to be “not persuasive.” A critical finding of fact was that the “Respondent has not adopted policy BC-3 as a rule” under the authority granted in its CC&Rs (section 4.5). The tribunal must follow the legislature’s explicit definition.
Administrative Law Judge’s Conclusions and Final Order
The ALJ’s conclusions of law led directly to the dismissal of the petition on jurisdictional grounds.
• Lack of Jurisdiction: Because Mr. Martin’s original petition only alleged that the respondent violated its website and policy manual—neither of which are “community documents” under Arizona law—the petition failed to meet the foundational requirements for a hearing under ARIZ. REV. STAT. § 32-2199.01(A).
• Improper Relief Requested: The ALJ also concluded that the relief Mr. Martin sought was not within the tribunal’s authority. Under ARIZ. REV. STAT. § 32-2199.02, an ALJ may order a party to abide by statutes or community documents and may levy civil penalties. The statute does not grant the authority to order large financial payments for construction or to mandate specific capital improvement projects.
• Final Order: Based on these conclusions, the petition was dismissed.
IT IS ORDERED that Petitioner Tom J. Martin’s petition is dismissed.
The decision, having been issued as the result of a rehearing, is binding on the parties. Any appeal must be filed for judicial review with the superior court within thirty-five days from the date of the order’s service.
Study Guide: Martin v. SaddleBrooke Home Owners Association #1, Inc.
This guide provides a detailed review of the Administrative Law Judge Decision in the case of Tom J. Martin vs. SaddleBrooke Home Owners Association #1, Inc. (No. 19F-H1918022-REL-RHG). It is designed to test and deepen understanding of the case’s facts, legal arguments, and final outcome.
——————————————————————————–
Short-Answer Quiz
Answer the following questions in 2-3 complete sentences, based on the information provided in the source document.
1. Who were the Petitioner and Respondent in case No. 19F-H1918022-REL-RHG?
2. What was the central allegation made by the Petitioner in his initial petition filed on or about September 28, 2018?
3. Describe the two alternative forms of relief the Petitioner requested in his petition.
4. On what primary legal grounds did the Respondent file its Motion to Dismiss?
5. According to Arizona Revised Statute section 33-1802(2), what are the four types of documents that constitute “community documents”?
6. Explain the two main arguments the Petitioner made in his Response to the Motion to Dismiss for why Policy BC-3 should be considered a governing document.
7. What new violation did the Petitioner allege in his request for a rehearing on December 31, 2019?
8. According to the Administrative Law Judge’s findings, what was the final outcome of the Petitioner’s petition and the primary reason for this decision?
9. According to A.R.S. § 32-2199.02, what powers does an administrative law judge have if a violation of community documents is found?
10. What is the process and time frame for a party wishing to appeal this Administrative Law Judge order?
——————————————————————————–
Answer Key
1. The Petitioner was Tom J. Martin, who appeared on his own behalf. The Respondent was SaddleBrooke Home Owners Association #1, Inc., which was represented by Carolyn B. Goldschmidt, Esq.
2. In his initial petition, Mr. Martin’s single-issue allegation was that the Respondent violated its website and its policy manual, specifically Policy Number BC-3. He included printouts from the website and a copy of the policy with his petition.
3. The Petitioner requested financial support in the sum of $463,112.00 for the expansion of pickleball courts in Bobcat Canyon. Alternatively, he requested that the Respondent provide eight pickleball courts within a two-mile radius of the community within one year, and be financially responsible for their maintenance at a level equal to its spending on eight tennis courts.
4. The Respondent argued that the Arizona Department of Real Estate lacked jurisdiction over the matter. This was because hearings are limited to disputes over “community documents,” and neither the website nor Policy BC-3 qualified as such under the definition provided in ARIZ. REV. STAT. section 33-1802(2).
5. Arizona Revised Statute section 33-1802(2) defines “community documents” as “the declaration, bylaws, articles of incorporation, if any, and rules, if any.”
6. First, Mr. Martin argued that based on A.R.S. § 1-213, the word “policy” should be given its ordinary meaning, which is a rule. Second, he asserted that because the Respondent’s own policy CE-3 defines “governing documents” to include Rules and Regulations, then BC-3 must be a governing document.
7. In his request for a rehearing, Mr. Martin alleged for the first time that the Respondent had violated its bylaws, specifically article 4, section 6(3), by failing to implement policy BC-3. He also alleged a violation of Articles of Incorporation Article XII.
8. The Administrative Law Judge ordered that Mr. Martin’s petition be dismissed. The dismissal was based on the finding that the petition did not meet the requirements of A.R.S. § 32-2199.01(A) because it alleged violations of a website and a policy manual, which are not legally defined as “community documents.”
9. If a violation is found, an administrative law judge may order any party to abide by the statute or document at issue. The judge may also levy a civil penalty for each violation and, if the petitioner prevails, order the respondent to pay the petitioner’s filing fee.
10. A party wishing to appeal the order must seek judicial review by filing an appeal with the superior court. This appeal must be filed within thirty-five days from the date a copy of the order was served upon the parties, as prescribed by A.R.S. section 12-904(A).
——————————————————————————–
Essay Questions
The following questions are designed for a more in-depth analysis of the case. Formulate a comprehensive response for each question based on the facts and legal principles presented in the decision.
1. Analyze the concept of jurisdiction as it applies to this case. Why was the distinction between “community documents” and other materials like websites or policy manuals the central factor in the judge’s jurisdictional decision?
2. Trace the procedural history of this case, from Mr. Martin’s initial petition to the final order of dismissal. Identify the key filings, arguments, and decisions at each stage of the process.
3. Evaluate the legal arguments presented by Mr. Martin. Explain his reasoning for equating a “policy” with a “rule” and why the Administrative Law Judge ultimately found this argument unpersuasive, citing relevant statutes and case law mentioned in the decision.
4. Discuss the limitations on the relief an Administrative Law Judge can grant in disputes involving planned communities, as outlined in A.R.S. § 32-2199.02. How did Mr. Martin’s requested relief fall outside the scope of the judge’s authority?
5. Explain the legal principle that when a legislature defines a word or term, a tribunal must follow that definition. How did this principle, as cited in Walker v. Scottsdale, directly influence the outcome of Mr. Martin’s petition?
——————————————————————————–
Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official who presides over administrative hearings, makes findings of fact and conclusions of law, and issues decisions. In this case, the ALJ was Thomas Shedden.
ARIZ. REV. STAT. (A.R.S.)
The abbreviation for Arizona Revised Statutes, which are the codified laws of the State of Arizona.
Articles of Incorporation
A set of formal documents filed with a government body to legally document the creation of a corporation. Defined in A.R.S. § 33-1802(2) as one of the “community documents.”
Bylaws
A set of rules adopted by an organization, such as an HOA, to govern its internal management and operations. Defined in A.R.S. § 33-1802(2) as one of the “community documents.”
CC&Rs (Covenants, Conditions, and Restrictions)
Rules governing the use of land within a particular planned community. Section 4.5 of the Respondent’s CC&Rs sets out its authority to adopt rules.
Community Documents
As defined by A.R.S. § 33-1802(2), these are “the declaration, bylaws, articles of incorporation, if any, and rules, if any.” The central legal issue of the case was whether the Respondent’s website and policy manual qualified as community documents.
Jurisdiction
The official power to make legal decisions and judgments. The Respondent argued, and the ALJ agreed, that the Office of Administrative Hearings did not have jurisdiction because the alleged violations did not involve “community documents.”
Motion to Dismiss
A formal request by a party for a court or tribunal to dismiss a case. The Respondent filed a Motion to Dismiss on November 30, 2018, arguing a lack of jurisdiction.
Petitioner
The party who files a petition initiating a legal case. In this matter, the Petitioner was Tom J. Martin.
Rehearing
A second hearing of a case to reconsider the issues and arguments, granted in this instance after the initial dismissal. The rehearing was conducted on April 16, 2019.
Respondent
The party against whom a petition is filed. In this matter, the Respondent was SaddleBrooke Home Owners Association #1, Inc.
Regulations adopted by a planned community association. The decision notes that while the Respondent has the authority to adopt rules, it had not adopted policy BC-3 as a rule.
4 Harsh Lessons from a Homeowner’s Failed Lawsuit Against His HOA
Introduction: The Promise vs. The Paperwork
Imagine finding the perfect community. Its website advertises fantastic amenities, including the pickleball courts you’ve been dreaming of. The association’s own policy manual seems to confirm this commitment. But what happens when the courts are never built and the homeowner association (HOA) doesn’t deliver on these perceived promises?
This isn’t a hypothetical scenario. It’s the central conflict in the case of Tom J. Martin versus the SaddleBrooke HOA in Arizona. Mr. Martin believed his HOA was legally obligated to provide pickleball courts based on its policies and marketing materials. His subsequent lawsuit, however, failed spectacularly, revealing some surprising truths about HOA disputes. This case provides several critical, counter-intuitive lessons for any current or future homeowner about the difference between a promise and a legally enforceable contract.
——————————————————————————–
1. A “Policy” Isn’t Always a Legally Binding “Rule”
Mr. Martin’s argument was straightforward: he believed the HOA violated its own “policy manual,” specifically a section referred to as Policy BC-3, by not providing pickleball courts. He contended that, in the ordinary sense of the word, a “policy” is a rule that must be followed.
The judge, however, dismissed the case based on a harsh legal reality. According to Arizona law, the court’s jurisdiction in this type of hearing is limited to violations of official “community documents.” The judge was bound by the statute’s specific definition of what constitutes these documents.
Based on Arizona Revised Statute § 33-1802(2), “community documents” are strictly defined as:
• The declaration (often called CC&Rs)
• Bylaws
• Articles of incorporation
• Rules
Crucially, the HOA’s own CC&Rs specified the exact procedure for how to adopt an enforceable rule, and the association had never subjected Policy BC-3 to that formal process. It wasn’t just a legal technicality; the HOA was following its own governing documents about how to create—or not create—a binding rule. Because the pickleball policy had not been formally adopted, it was legally unenforceable in this hearing.
Key Takeaway Analysis: In a legal dispute, the common-sense meaning of a word can be overruled by a specific statutory definition. It’s not enough to read an HOA’s policy manual. As a homeowner, you must cross-reference that policy with the CC&Rs or Bylaws to confirm the HOA has followed its own stated procedure for adopting it as a formal, legally binding rule.
——————————————————————————–
2. Marketing Materials Are Not Governing Documents
To support his case, Mr. Martin presented printouts from the HOA’s website. He felt these materials advertised and marketed the availability of pickleball courts, stating in a legal filing that “the Association is in violation for not providing pickleball courts as advertised and marketed….”
The judge’s conclusion was unequivocal: advertising and marketing materials, just like the internal policy manual, do not qualify as “community documents.” The legal definition is exclusive, and an HOA’s website is not on the list. Therefore, promises or suggestions made on a website carry no legal weight in a dispute over violations of governing documents.
Key Takeaway Analysis: There is a significant gap between marketing promises and legally enforceable obligations. For potential buyers, this is a critical warning. The glossy brochure, the community website, and the sales pitch might paint a picture of community life, but that picture is not guaranteed by the legally binding documents you sign at closing.
——————————————————————————–
3. You Must Allege a Violation of theRightDocument
The case also reveals a crucial lesson in legal procedure. In his initial petition, Mr. Martin only alleged violations of the HOA’s website and its policy manual. While his petition form indicated alleged violations of the “CC&Rs and Bylaws,” he failed to identify any specific provisions within those official documents that the HOA had actually violated.
It was only after his case was first dismissed that he attempted to specify violations of the Bylaws and Articles of Incorporation in his request for a rehearing. By then, it was too late. The initial petition failed to allege a violation of a legitimate community document.
Key Takeaway Analysis: Precision is paramount. To successfully challenge an HOA in an administrative hearing, a homeowner cannot just have a general grievance. You must be able to pinpoint the exact article, section, and provision of an official “community document” (like the CC&Rs or Bylaws) that was violated and state it clearly in your initial complaint.
——————————————————————————–
4. The Court May Not Have the Power to Grant Your Request
Mr. Martin was clear about what he wanted the court to do. He requested one of two specific forms of relief:
• Provide financial support of $463,112.00 for the expansion of pickleball courts in Bobcat Canyon.
• Alternatively, construct eight new pickleball courts within a two-mile radius of the community within one year, with the HOA being financially responsible for their maintenance.
The judge noted a final, critical problem with the case: the requested relief was “not within the scope of the Administrative Law Judge’s authority.” The law governing these hearings simply did not give the judge the power to order an HOA to undertake a massive, six-figure construction project.
Key Takeaway Analysis: Even if you have a valid case and prove the HOA violated a rule, the court or tribunal you are in has limits. An administrative hearing might only be empowered to levy a civil penalty or issue an order for the HOA to abide by an existing rule. It likely cannot force the HOA to build new facilities or make large capital expenditures. This highlights the need to research the legal venue before you file to ensure it has the authority to grant the specific outcome you are seeking.
——————————————————————————–
Conclusion: Read Before You Litigate
The outcome of Mr. Martin’s lawsuit underscores the critical difference between a homeowner’s reasonable expectations and an HOA’s legally enforceable covenants. For homeowners, disputes are won or lost based on the precise wording of official governing documents—the CC&Rs, bylaws, and formal rules.
Before you challenge your HOA, have you read the fine print to see if their promise is written in the one place that truly matters?
Case Participants
Petitioner Side
- Tom J. Martin (petitioner)
Appeared on his own behalf
Respondent Side
- Carolyn B. Goldschmidt (respondent attorney)
Goldschmidt, Shupe, PLLC - Michael S. Shupe (attorney)
Goldschmidt, Shupe, PLLC
Recipient of transmittal
Neutral Parties
- Thomas Shedden (ALJ)
- Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
Recipient of transmittal - LDettorre (ADRE staff)
Arizona Department of Real Estate
Recipient of transmittal (Identified by email handle portion) - AHansen (ADRE staff)
Arizona Department of Real Estate
Recipient of transmittal (Identified by email handle portion) - djones (ADRE staff)
Arizona Department of Real Estate
Recipient of transmittal (Identified by email handle portion) - DGardner (ADRE staff)
Arizona Department of Real Estate
Recipient of transmittal (Identified by email handle portion) - ncano (ADRE staff)
Arizona Department of Real Estate
Recipient of transmittal (Identified by email handle portion)
Other Participants
- JS (Unknown staff)
Transmittal initials
