The petition was dismissed because the Petitioner failed to demonstrate a violation by the Association, conceding that the Association was not in violation of the cited CC&R section.
Why this result: Petitioner acknowledged the Association was not in violation of CC&R section 2.7, the single issue raised in the petition.
Key Issues & Findings
Alleged violation of CC&R section 2.7 by the Association (later asserted as estoppel regarding enforcement)
Petitioner alleged the Respondent Association violated CC&R section 2.7. At the hearing, Petitioner acknowledged the Association was not actually in violation of section 2.7, but argued the Association was estopped from enforcing the provision requiring a six-foot gate for RV storage. Petitioner sought invalidation of outstanding fines.
The petition was dismissed because the Petitioner failed to demonstrate a violation by the Association, conceding that the Association was not in violation of the cited CC&R section.
Why this result: Petitioner acknowledged the Association was not in violation of CC&R section 2.7, the single issue raised in the petition.
Key Issues & Findings
Alleged violation of CC&R section 2.7 by the Association (later asserted as estoppel regarding enforcement)
Petitioner alleged the Respondent Association violated CC&R section 2.7. At the hearing, Petitioner acknowledged the Association was not actually in violation of section 2.7, but argued the Association was estopped from enforcing the provision requiring a six-foot gate for RV storage. Petitioner sought invalidation of outstanding fines.
Orders: Don France's petition is dismissed.
Filing fee: $500.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
ARIZ. REV. STAT. § 32-2199.02(A)
ARIZ. REV. STAT. § 41-1092.07(F)(6)
ARIZ. REV. STAT. section 32-2199.02(B)
ARIZ. REV. STAT. section 32-2199.04
ARIZ. REV. STAT. section 41-1092.09
Analytics Highlights
Topics: CC&R, RV storage, Estoppel, Fines
Additional Citations:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
ARIZ. REV. STAT. § 32-2199.02(A)
ARIZ. REV. STAT. § 41-1092.07(F)(6)
ARIZ. REV. STAT. section 32-2199.02(B)
ARIZ. REV. STAT. section 32-2199.04
ARIZ. REV. STAT. section 41-1092.09
Video Overview
Audio Overview
Decision Documents
20F-H2020056-REL Decision – 823714.pdf
Uploaded 2025-10-09T03:35:18 (96.1 KB)
Briefing Doc – 20F-H2020056-REL
Administrative Hearing Briefing: France v. Mesa East Property Owners Association
Executive Summary
This document provides a detailed analysis of the administrative hearing decision in case number 20F-H2020056-REL, involving petitioner Don France and respondent Mesa East Property Owners Association (the “Association”). The core of the dispute was the Association’s enforcement of its Covenants, Conditions, and Restrictions (CC&Rs), specifically section 2.7, which requires a six-foot-high gate for Recreational Vehicles (RVs) stored on a property.
The petitioner, Mr. France, was fined by the Association in 2019 for not having the required gate on an RV structure that the Association itself had approved in 2014. Mr. France initially filed a petition alleging the Association was in violation of its own CC&Rs. However, at the September 1, 2020 hearing, he conceded this was not the case and instead argued the Association was “estopped”—or legally prevented—from enforcing the rule due to its prior approval.
The Administrative Law Judge ultimately dismissed Mr. France’s petition on procedural grounds. The judge determined that since Mr. France acknowledged his petition’s central claim was incorrect, he had failed to meet his burden of proof. The new arguments concerning estoppel and the legality of the fines were deemed not properly before the tribunal because they were not included in the original petition. The decision underscores the critical importance of aligning claims made in a formal petition with the arguments presented at a hearing.
Case Overview
Case Number
No. 20F-H2020056-REL
In the Office of Administrative Hearings
Petitioner
Don France
Respondent
Mesa East Property Owners Association
Respondent’s Counsel
B. Austin Bailio, Esq.
Administrative Law Judge
Thomas Shedden
Hearing Date
September 1, 2020
Decision Date
September 21, 2020
The central issue of the case revolves around the enforcement of CC&R section 2.7, which mandates that RVs stored on a property must be screened behind a structure with a six-foot-high gate. This requirement is mirrored by a City of Mesa municipal code.
Chronology of Key Events
• 2014: Mr. France applies for and receives approval from the Association’s Architectural Review Committee (ARC) to build an RV port. In his application, he acknowledges he will abide by deed restrictions and City of Mesa codes.
• October 21, 2014: The Association issues its final approval for the structure, which is built without a gate.
• Circa 2018: Following threats of litigation from other residents over non-enforcement of the CC&Rs, the Association begins a new enforcement campaign for the six-foot gate rule. The City of Mesa denies the Association’s request to “grandfather in” non-compliant homes.
• 2019: The deadline for residents to come into compliance passes.
• March 11, 2019: The Association issues a Notice of Violation (NOV) to Mr. France for lacking the required gate.
• April 5, 2019: Through an attorney, Mr. France asserts that the Association is estopped from enforcing the rule due to its 2014 approval.
• May 15, 2019: The Association’s attorney rejects the estoppel claim and informs Mr. France’s attorney that fines of $500 per week will be assessed.
• May 31, 2019: The Association assesses a $500 fine against Mr. France, with additional fines assessed later.
• July 24, 2019: The City of Mesa issues its own NOV to Mr. France, citing a violation of city code 11-34-5(B), which also requires a six-foot screening fence for RVs.
• April 16, 2020: Mr. France files a petition alleging the Association is in violation of CC&R section 2.7.
• Prior to Hearing: To comply with the City of Mesa’s NOV, Mr. France installs a temporary gate at a cost of approximately $800.
• September 1, 2020: The administrative hearing is conducted.
Analysis of Arguments and Testimonies
Petitioner’s Position (Don France)
• Initial Petition: The formal petition, filed on April 16, 2020, was based on the single issue that the Mesa East Property Owners Association had violated its own CC&R section 2.7.
• Revised Argument at Hearing: During the hearing, Mr. France acknowledged that the Association was not, in fact, violating section 2.7. His argument shifted to a claim of estoppel, asserting that the Association could not enforce the rule against him because its own ARC had approved his gateless structure in 2014.
• Requested Relief: Mr. France asked the judge to rule that the Association could not require him to install a gate and to invalidate any outstanding fines levied against him.
• Supporting Testimony: Joann Van Kirk, the chairperson of the ARC in 2014, testified on Mr. France’s behalf. She stated that she had been informed by a past chair that no gate was required for structures like Mr. France’s, citing other properties that had RV shelters without gates. She also testified that she called the City of Mesa at the time and was told a gate was not required if the structure was attached to the house.
Respondent’s Position (Mesa East POA)
• Basis for Enforcement: The Association began strictly enforcing the gate requirement around 2018 after being threatened with lawsuits by other members for failing to enforce the CC&Rs.
• Enforcement Actions: After an unsuccessful attempt to have the City of Mesa grandfather in non-compliant properties, the Association notified members of the requirement via its newsletter and online, setting a compliance deadline of 2019. When Mr. France did not comply, the Association issued an NOV and subsequently began assessing fines.
• Legal Stance: The Association’s counsel formally rejected Mr. France’s estoppel argument in May 2019.
• Supporting Testimony: Donald Smith testified that at the time the NOV was issued to Mr. France, eleven other residents were also non-compliant. By the hearing date, six remained in violation, five of whom had agreed to comply. This testimony was intended to show that the enforcement was not targeted solely at Mr. France.
Independent Municipal Action
The City of Mesa’s regulations played a significant and independent role in the matter.
• City Code: The City of Mesa has its own ordinance, Code section 11-34-5(B), which requires RVs taller than six feet to be screened by a six-foot-tall fence.
• Notice of Violation: On July 24, 2019, the City issued its own NOV to Mr. France for violating this code.
• Consequence: This municipal enforcement action compelled Mr. France to install a temporary gate to avoid penalties from the City, regardless of the outcome of his dispute with the Property Owners Association.
Administrative Law Judge’s Decision and Rationale
Final Order: IT IS ORDERED that Don France’s petition is dismissed.
The judge’s decision to dismiss the case was based on a precise legal and procedural rationale, rather than the merits of the estoppel argument.
• Failure of the Core Claim: The judge noted that Mr. France’s petition was limited to the single claim that the Association had violated CC&R section 2.7. At the hearing, Mr. France himself admitted this was not the case. As the petitioner, Mr. France bore the burden of proof, and his own testimony demonstrated that the “preponderance of the evidence shows that there is no violation.”
• Jurisdictional Limitation: The new issues raised by Mr. France at the hearing—namely the estoppel argument and the legality of the fines—were declared “not properly before the tribunal.” The judge reasoned that these claims were not included in the original petition, a separate filing fee was not paid for a second issue, and the claims were not listed in the official Notice of Hearing. This procedural failure prevented the judge from ruling on the substance of these arguments.
Conclusion and Post-Decision Protocol
The dismissal of Mr. France’s petition represents a conclusive finding in favor of the respondent based on the specific claims filed. The decision illustrates that the scope of an administrative hearing is strictly defined by the issues raised in the initial petition.
According to the decision document, the order is binding on both parties unless a rehearing is granted. A request for a rehearing must be filed with the Commissioner of the Arizona Department of Real Estate within 30 days of the service of the order, pursuant to Arizona Revised Statutes.
Study Guide – 20F-H2020056-REL
Study Guide: France v. Mesa East Property Owners Association (No. 20F-H2020056-REL)
This guide provides a comprehensive review of the administrative hearing decision in the case between Don France (Petitioner) and the Mesa East Property Owners Association (Respondent), as decided by Administrative Law Judge Thomas Shedden.
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Short-Answer Questions
Instructions: Answer the following questions in two to three complete sentences, drawing all information directly from the provided legal decision.
1. Who are the primary parties in this case, and what was the single issue alleged in the Petitioner’s original petition filed on April 16, 2020?
2. According to CC&R section 2.7 and the City of Mesa’s code, what is the specific requirement for storing a recreational vehicle (RV) on a property?
3. What enforcement actions did the Mesa East Property Owners Association take against Don France in the spring of 2019?
4. What was Don France’s primary legal argument against the Association’s enforcement, which he revealed at the September 1, 2020 hearing?
5. What was the state of compliance on Mr. France’s property regarding the RV gate as of the hearing date, and what prompted this action?
6. According to the testimony of Donald Smith, what prompted the Association to begin enforcing the six-foot gate requirement around 2018?
7. What key information did Joann Van Kirk, the 2014 chairperson of the Architectural Review Committee, provide in her testimony?
8. How did the Petitioner’s argument at the hearing differ from the allegation in his initial petition, and why was this difference critical to the case’s outcome?
9. Why did the Administrative Law Judge decline to rule on the legality of the fines the Association had levied against Mr. France?
10. What was the ultimate order issued by the Administrative Law Judge, and what was the legal reasoning behind this decision?
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Answer Key for Short-Answer Questions
1. The primary parties are Don France, the Petitioner, and the Mesa East Property Owners Association, the Respondent. The single issue alleged in Mr. France’s petition was that the Association was in violation of its own CC&R section 2.7.
2. Both CC&R section 2.7 (the 1994 version) and the City of Mesa’s code (section 11-34-5(B)) require that RVs stored on a property must be screened behind a structure with a gate that is at least six feet high. The CC&Rs also specified the fence and gate must be tall enough to prevent a person from seeing the RV.
3. On March 11, 2019, the Association issued a Notice of Violation to Mr. France because his RV structure lacked a six-foot gate. Subsequently, on May 31, 2019, the Association fined him $500 for the same violation.
4. At the hearing, Mr. France’s primary argument was that the Association was “estopped” from finding him in violation of section 2.7. He argued this because the Association’s Architectural Review Committee had approved his RV structure in 2014 without the gate.
5. As of the hearing date, Mr. France had installed a temporary six-foot gate at a cost of about $800. This action was taken to comply with a Notice of Violation issued to him by the City of Mesa on July 24, 2019.
6. Donald Smith testified that around 2018, people were threatening to sue the Association if it did not enforce the CC&Rs. After meeting with the City of Mesa, which would not allow non-compliant homes to be grandfathered in, the Association began enforcing the gate requirement.
7. Joann Van Kirk testified that in 2014, she had learned from the past ARC chair that no gate was required because other owners had shelters without gates. She also testified that she called the City of Mesa and was told no gate was required if the structure was attached to the house.
8. While his petition alleged the Association had violated section 2.7, at the hearing Mr. France acknowledged this was not the case and argued instead that the Association was estopped from enforcing that section against him. This was critical because the judge could only rule on the single issue raised in the petition, which Mr. France conceded had no merit.
9. The judge declined to rule on the legality of the fines because the issue was not raised in Mr. France’s original petition. Therefore, it was not properly before the tribunal as a filing fee had not been paid for a second issue and it was not included in the Notice of Hearing.
10. The judge ordered that Don France’s petition be dismissed. The reasoning was that the petition was limited to the single issue of whether the Association had violated CC&R section 2.7, and Mr. France himself acknowledged at the hearing that no such violation by the Association had occurred.
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Essay Questions
Instructions: The following questions are designed for a more in-depth analysis of the case. Formulate a comprehensive essay-format response for each, citing specific facts from the case decision to support your arguments.
1. Analyze the concept of estoppel as it applies to this case. Explain why Don France believed the Association was estopped from enforcing the gate requirement, referencing the 2014 approvals, and discuss why the Association disagreed and proceeded with enforcement actions.
2. Discuss the procedural limitations that shaped the outcome of this hearing. How did the specific wording of Mr. France’s initial petition and the rules governing administrative hearings ultimately prevent the judge from considering the central issues of estoppel and the validity of the fines?
3. Examine the conflict between a property owner’s reliance on past approvals and a Property Owners Association’s duty to enforce its CC&Rs. Use the testimony of Joann Van Kirk and Donald Smith to illustrate the differing perspectives and pressures that led to this dispute.
4. Trace the timeline of events from Mr. France’s 2014 application to the 2020 hearing. Detail the key actions taken by Mr. France, the Association’s Architectural Review Committee, the Association’s Board, and the City of Mesa, and explain how their interactions created the legal conflict.
5. Evaluate the standard of proof required in this case, the “preponderance of the evidence.” Although the case was dismissed on a procedural issue, discuss which party presented a more convincing case regarding the underlying dispute over the RV gate, and why.
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
An official (Thomas Shedden in this case) who presides over administrative hearings, makes findings of fact and conclusions of law, and issues decisions and orders.
Architectural Review Committee (ARC)
A committee within the Property Owners Association responsible for reviewing and approving applications for property improvements, such as Mr. France’s RV port in 2014.
Burden of Proof
The responsibility of a party in a legal case to prove their allegations. In this matter, Mr. France bore the burden of proof to show the Association violated its CC&Rs.
Covenants, Conditions, and Restrictions. These are the governing community documents that set rules for property use, such as section 2.7 which requires a six-foot gate for RV storage.
Conclusions of Law
The section of the judge’s decision that applies legal principles and statutes to the established facts of the case to reach a final ruling.
Estoppel
A legal principle asserted by Mr. France arguing that the Association should be prevented from enforcing a rule (the gate requirement) against him because of its prior action (approving his structure without a gate in 2014).
Findings of Fact
A formal, numbered list of facts in the judge’s decision that are established by the evidence and testimony presented during the hearing.
Notice of Violation (NOV)
A formal notice issued by the Association or the City of Mesa to a property owner informing them that they are in violation of a specific rule or code.
Petitioner
The party who initiates a legal action by filing a petition. In this case, Don France is the Petitioner.
Preponderance of the Evidence
The standard of proof required in this hearing. It is defined as evidence with “the most convincing force” that is sufficient to incline an impartial mind to one side of an issue over the other.
Respondent
The party against whom a petition is filed. In this case, the Mesa East Property Owners Association is the Respondent.
Blog Post – 20F-H2020056-REL
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20F-H2020056-REL
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The provided text is an Administrative Law Judge Decision from the Office of Administrative Hearings concerning the case of Don France versus the Mesa East Property Owners Association. The document details a dispute where Petitioner Don France alleged that the Respondent Association violated a community covenant regarding the storage of recreational vehicles (RVs), specifically CC&R section 2.7, which requires RVs to be stored behind a six-foot gate. Although Mr. France initially brought the petition alleging the Association violated the rule, he ultimately argued that the Association was estopped from enforcing the rule against him due to past approval of his RV structure without a gate. The decision includes a summary of the Findings of Fact related to Mr. France’s structure, the Association’s attempts to enforce the gate requirement against him and other residents, and the resulting fines he incurred before installing a gate to comply with a separate City of Mesa Notice of Violation. Ultimately, the Administrative Law Judge determined that Mr. France failed to meet the burden of proof to show the Association violated the CC&Rs, and his petition was dismissed because he acknowledged the Association was not actually in violation of section 2.7.
What were the legal and factual grounds for the case’s dismissal?
How did the Association’s past actions relate to the estoppel claim?
What was the core conflict between the homeowner, HOA, and city codes?
Based on 1 source
Case Participants
Petitioner Side
Don France(petitioner) Appeared on his own behalf and testified
Joann Van Kirk(witness) Testified for Petitioner; was chairperson of Architectural Review Committee ('ARC') in 2014
Respondent Side
B. Austin Bailio(HOA attorney) Maxwell & Morgan, P.C. Attorney for Respondent Mesa East Property Owners Association
Michael Estey(witness) Testified for Respondent
Donald Smith(witness) Testified for Respondent
Neutral Parties
Thomas Shedden(ALJ) Office of Administrative Hearings
Judy Lowe(commissioner) Arizona Department of Real Estate
The petition was dismissed because the Petitioner failed to demonstrate a violation by the Association, conceding that the Association was not in violation of the cited CC&R section.
Why this result: Petitioner acknowledged the Association was not in violation of CC&R section 2.7, the single issue raised in the petition.
Key Issues & Findings
Alleged violation of CC&R section 2.7 by the Association (later asserted as estoppel regarding enforcement)
Petitioner alleged the Respondent Association violated CC&R section 2.7. At the hearing, Petitioner acknowledged the Association was not actually in violation of section 2.7, but argued the Association was estopped from enforcing the provision requiring a six-foot gate for RV storage. Petitioner sought invalidation of outstanding fines.
Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.
Case Summary
Case ID
19F-H1919071-REL-RHG
Agency
ADRE
Tribunal
OAH
Decision Date
2020-01-30
Administrative Law Judge
Velva Moses-Thompson
Outcome
loss
Filing Fees Refunded
$0.00
Civil Penalties
$0.00
Parties & Counsel
Petitioner
Thomas J. Van Dan Elzen
Counsel
—
Respondent
Carter Ranch Homeowners Association
Counsel
Augustus H. Shaw IV
Alleged Violations
A.R.S. § 33-1808
Outcome Summary
The Administrative Law Judge dismissed the Petitioner's claim, concluding that the Petitioner failed to prove the HOA violated A.R.S. § 33-1808 regarding flag display or that the HOA improperly adopted its rules; the Respondent was deemed the prevailing party,,.
Why this result: Petitioner failed to establish by a preponderance of the evidence that the Respondent violated A.R.S. § 33-1808,, and failed to establish that the Flag Display Rule was improperly adopted or inconsistent with the CC&Rs.
Key Issues & Findings
Flag and Political Sign Display Restriction
Petitioner alleged the HOA violated A.R.S. § 33-1808 by prohibiting him from displaying a 'Trump 2020' flag in his front yard, asserting the HOA's Flag Display Rule was invalid because the CC&Rs did not specifically mention 'flag',,.
Orders: The petition is dismissed.
Filing fee: $0.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
A.R.S. § 33-1808
A.A.C. R2-19-119
Analytics Highlights
Topics: Flag display, Political signs, HOA rules, Statutory violation
Administrative Hearing Brief: Van Dan Elzen v. Carter Ranch Homeowners Association
Executive Summary
This document synthesizes the findings and conclusions from two administrative law judge decisions concerning a dispute between homeowner Thomas J. Van Dan Elzen and the Carter Ranch Homeowners Association (HOA). The core conflict arose from Mr. Van Dan Elzen’s display of a “Trump 2020” flag, which the HOA deemed a violation of its “Flag Display Rule.” Mr. Van Dan Elzen petitioned the Arizona Department of Real Estate, alleging the HOA’s rule was invalid and violated Arizona Revised Statutes (A.R.S.) § 33-1808.
The Administrative Law Judge (ALJ) ultimately dismissed the petition, both in the initial hearing and upon a subsequent rehearing. The central findings were that the petitioner failed to meet his burden of proof to demonstrate that the HOA’s rule was inconsistent with its governing documents (CC&Rs) or that the HOA had violated the state statute. The HOA’s authority to create rules restricting the use of lots, granted by its CC&Rs, was upheld. The final decision affirmed the HOA as the prevailing party, concluding a legal challenge that centered on the distinction between statutorily protected flags and political displays.
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I. Case Background and Chronology
The dispute was adjudicated by the Office of Administrative Hearings, with Velva Moses-Thompson serving as the Administrative Law Judge. The case involved a petition filed by a homeowner against his HOA regarding flag display regulations.
Parties Involved:
• Petitioner: Thomas J. Van Dan Elzen (appeared on his own behalf)
• Respondent: Carter Ranch Homeowners Association (represented by Augustus H. Shaw IV, Esq.)
Key Events:
Date (2019-2020)
May 21, 2019
Carter Ranch HOA notifies Mr. Van Dan Elzen that his “Trump 2020” flag violates association rules.
June 14, 2019
Mr. Van Dan Elzen files a petition with the Arizona Department of Real Estate, alleging a violation of A.R.S. § 33-1808.
July 16, 2019
The Department of Real Estate issues a Notice of Hearing.
Sept. 9, 2019
The initial administrative hearing is held.
Sept. 30, 2019
The ALJ issues a decision dismissing the petitioner’s case.
Nov. 18, 2019
The Department of Real Estate issues an order for a rehearing.
Jan. 10, 2020
A rehearing is held.
Jan. 30, 2020
The ALJ issues a final decision on the rehearing, again dismissing the petition.
II. The Core Dispute and Competing Arguments
The central issue was the legality of the Carter Ranch HOA’s rule prohibiting Mr. Van Dan Elzen’s “Trump 2020” flag and the scope of the HOA’s authority to regulate such displays.
A. The Petitioner’s Position (Thomas J. Van Dan Elzen)
Mr. Van Dan Elzen’s challenge was based on the premise that the HOA’s “Flag Display Rule” was invalid because it was not explicitly supported by the language of the community’s Covenants, Conditions, and Restrictions (CC&Rs).
• Primary Argument: He asserted that because the CC&Rs do not specifically contain the word “flag,” any rule created by the HOA Board regulating flags is inconsistent with the CC&Rs and therefore unenforceable.
• Petition Allegation: In his formal petition, Mr. Van Dan Elzen stated the violation was “based on 33-1808 Flags and Sings [sic].” He further argued that the HOA’s rule referenced section 3.14 of the CC&Rs, which he claimed “ONLY defines SIGNS and has no reference to Flags whatsoever.”
B. The Respondent’s Position (Carter Ranch HOA)
The Carter Ranch HOA maintained that its “Flag Display Rule” was a valid exercise of the authority granted to its Board by the community’s governing documents.
• Basis of Authority: The HOA contended that it was authorized to adopt the rule under Article V, Section 5.3 of its CC&Rs.
• Defense of the Rule: The HOA argued that the Flag Display Rule was not inconsistent with the CC&Rs and was properly adopted.
• Argument for Dismissal: Carter Ranch asserted that the petition should be dismissed because the petitioner had not successfully alleged a violation of any statute or provision within the governing documents.
III. Governing Documents and Legal Framework
The case was decided based on an interpretation of both state law and the HOA’s internal governing documents.
A. Carter Ranch Homeowners Association Rules
• The “Flag Display Rule”: The association’s rules and regulations explicitly prohibit the flying of any flag other than the following:
◦ The American Flag
◦ Official or replica flags of the U.S. Army, Navy, Air Force, Marine Corps, or Coast Guard
◦ A POW/MIA flag
◦ The Arizona State flag
◦ An Arizona Indian Nations flag
◦ The Gadsden Flag
• CC&Rs, Article V, Section 5.3: This section grants the HOA Board broad rule-making authority. The text states, in relevant part:
B. Arizona Revised Statutes § 33-1808
This state statute places specific limitations on an HOA’s ability to prohibit certain flags and political signs.
• Section A – Protected Flags: The statute mandates that an HOA “shall not prohibit the outdoor display” of the exact list of flags enumerated in the Carter Ranch “Flag Display Rule” (American, military, POW/MIA, state, etc.). A “Trump 2020” flag is not included in this list of protected flags.
• Section C – Political Signs: The statute addresses political signs separately from flags.
◦ Definition: A “political sign” is defined as “a sign that attempts to influence the outcome of an election.”
◦ Regulation: An HOA may prohibit political signs “earlier than seventy-one days before the day of an election and later than three days after an election day.”
◦ Size/Number: An HOA may regulate the size and number of signs, provided the rules are no more restrictive than local ordinances. If no local ordinance exists, an HOA cannot limit the number of signs but can cap the maximum aggregate dimensions at nine square feet.
IV. Administrative Law Judge’s Conclusions and Final Order
Across both the initial hearing and the rehearing, the ALJ’s conclusions of law consistently favored the respondent HOA. The petitioner failed to meet the required legal standard to prove his case.
A. Burden of Proof
The ALJ established that the petitioner, Mr. Van Dan Elzen, bore the burden of proving by a “preponderance of the evidence” that the HOA had violated A.R.S. § 33-1808. A preponderance of the evidence means showing the fact sought to be proved is “more probable than not.”
B. Key Conclusions of Law
• Validity of the “Flag Display Rule”: The ALJ concluded that the petitioner “had not established that the Association improperly adopted the Flag Display Rule under its CC&Rs.” In the rehearing, this was stated as the petitioner having “not established that the Flag Display Rule was inconsistent with the CC&Rs.”
• No Statutory Violation: A critical conclusion in both decisions was that the petitioner “has not alleged that Carter Ranch violated A.R.S. § 33-1808.”
• Final Judgment: Based on these conclusions, the ALJ determined that Mr. Van Dan Elzen’s petition should be dismissed and that the Carter Ranch HOA should be deemed the prevailing party.
C. Final Order
• Initial Decision (September 30, 2019): “IT IS ORDERED that Petitioner Thomas J. Van Dan Elzen’s petition is dismissed.”
• Rehearing Decision (January 30, 2020): The order to dismiss was reaffirmed. The final notice specified that this order was binding on the parties and that any appeal must be filed for judicial review with the superior court within thirty-five days.
Study Guide – 19F-H1919071-REL-RHG
Study Guide: Van Dan Elzen v. Carter Ranch Homeowners Association
This study guide provides a comprehensive review of the administrative law case involving Thomas J. Van Dan Elzen and the Carter Ranch Homeowners Association, based on the legal decisions from September 2019 and January 2020. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms.
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Short-Answer Quiz
Instructions: Answer the following questions in 2-3 sentences each, based on the provided case documents.
1. Who were the Petitioner and the Respondent in this case, and what was the official case number?
2. What specific action by the Petitioner prompted the initial notice of violation from the homeowners association?
3. What was the Petitioner’s primary legal argument against the validity of the Association’s “Flag Display Rule”?
4. According to the Carter Ranch CC&Rs, what authority does the Board have to create rules and regulations?
5. What is the “preponderance of the evidence,” and which party had the burden of meeting this standard?
6. List at least five of the flags that are explicitly permitted for display under the Carter Ranch “Flag Display Rule.”
7. Summarize the key provisions of Arizona Revised Statute § 33-1808(C) regarding “political signs.”
8. What was the Administrative Law Judge’s conclusion regarding the Petitioner’s claim that the Association improperly adopted the Flag Display Rule?
9. What was the final outcome of the petition after both the initial hearing on September 9, 2019, and the rehearing on January 10, 2020?
10. Who was the Administrative Law Judge that presided over both hearings?
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Answer Key
1. The Petitioner was Thomas J. Van Dan Elzen, and the Respondent was the Carter Ranch Homeowners Association. The case number was 19F-H1919071-REL, with the rehearing designated as 19F-H1919071-REL-RHG.
2. The case was prompted by Mr. Van Dan Elzen displaying a “Trump 2020” flag on a flagpole in his front yard. On or about May 21, 2019, Carter Ranch notified him that this action violated the Association’s rules.
3. The Petitioner argued that the Flag Display Rule was invalid because the community’s Covenants, Conditions, and Restrictions (CC&Rs) do not specifically mention the word “flag.” He asserted that the Association’s rules and regulations can only be based on topics explicitly mentioned in the CC&Rs.
4. Article V, Section 5.3 of the CC&Rs grants the Board the authority to adopt, amend, and repeal rules pertaining to the management of common areas, minimum maintenance standards for lots, the health, safety, or welfare of residents, and restrictions on the use of lots.
5. “Preponderance of the evidence” is evidence that is more convincing and shows that the fact sought to be proved is more probable than not. The Petitioner, Mr. Van Dan Elzen, bore the burden of proving his case by this standard.
6. The Carter Ranch Flag Display Rule permits the display of the American Flag, an official replica of a U.S. military flag (Army, Navy, Air Force, Marine Corps, or Coast Guard), a POW/MIA flag, an Arizona Indian nations flag, the Arizona State flag, and the Gadsden Flag.
7. A.R.S. § 33-1808(C) states that an association cannot prohibit the display of political signs on a member’s property, but it can prohibit them earlier than 71 days before an election and later than 3 days after an election. An association may also regulate the size and number of signs to be no more restrictive than local ordinances, or to a maximum aggregate of nine square feet if no such ordinances exist.
8. The Administrative Law Judge concluded that the Petitioner had not established that the Association improperly adopted the Flag Display Rule under its CC&Rs. The judge found that the rule was not inconsistent with the CC&Rs.
9. In both instances, the Administrative Law Judge ordered that the Petitioner’s petition be dismissed. The Respondent, Carter Ranch Homeowners Association, was deemed the prevailing party in the matter.
10. The Administrative Law Judge for both the initial hearing and the rehearing was Velva Moses-Thompson.
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Suggested Essay Questions
Instructions: The following questions are designed to test a deeper, analytical understanding of the case. Formulate a comprehensive response for each.
1. Analyze the Petitioner’s legal strategy. Why did his argument that the CC&Rs do not explicitly mention the word “flag” ultimately fail to meet the “preponderance of the evidence” standard?
2. Explain the relationship between the Carter Ranch CC&Rs, the Association’s Rules and Regulations, and Arizona Revised Statute § 33-1808. How do these documents interact to govern what a resident can display on their property?
3. Discuss the concept of “burden of proof” in this case. How did the “preponderance of the evidence” standard apply to Thomas J. Van Dan Elzen’s petition, and why did the Administrative Law Judge conclude he did not meet it?
4. Could the “Trump 2020” flag have been considered a “political sign” under the definition provided in A.R.S. § 33-1808(C)? Based on the text, evaluate the potential arguments for and against this classification and how the statute’s time restrictions on display might have been relevant.
5. Examine the authority granted to the Carter Ranch HOA Board by Article V, Section 5.3 of its CC&Rs. How did the HOA use this section to justify its Flag Display Rule, and how did the Administrative Law Judge evaluate this justification?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
The judge who presides over administrative hearings. In this case, the ALJ was Velva Moses-Thompson.
A.R.S. § 33-1808
The Arizona Revised Statute that, notwithstanding community documents, protects the right of homeowners to display certain flags (American, military, POW/MIA, state, etc.) and regulates how an association may restrict political signs.
Burden of Proof
The obligation of a party in a legal proceeding to provide evidence to prove their claim. In this case, the Petitioner had the burden of proof.
Covenants, Conditions, and Restrictions (CC&Rs)
The governing legal documents that set up the guidelines for a planned community or homeowners association. In this case, Article V, Section 5.3 of the CC&Rs gave the Board authority to create rules.
Flag Display Rule
The specific Carter Ranch Association rule prohibiting any flag other than the American Flag, specific military flags, POW/MIA flag, Arizona Indian National flag, Arizona State flag, and the Gadsden Flag.
Petitioner
The party who files a petition to initiate a legal proceeding. In this case, the petitioner was Thomas J. Van Dan Elzen.
Political Sign
As defined in A.R.S. § 33-1808(C), “a sign that attempts to influence the outcome of an election, including supporting or opposing the recall of a public officer or supporting or opposing the circulation of a petition for a ballot measure, question or proposition or the recall of a public officer.”
Preponderance of the Evidence
The standard of proof required in this proceeding. Defined in the decision as “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.”
Rehearing
A second hearing of a case. In this matter, a rehearing was held on January 10, 2020, after the initial decision was made on September 30, 2019.
Respondent
The party against whom a petition is filed. In this case, the respondent was the Carter Ranch Homeowners Association.
Blog Post – 19F-H1919071-REL-RHG
Study Guide: Van Dan Elzen v. Carter Ranch Homeowners Association
This study guide provides a comprehensive review of the administrative law case involving Thomas J. Van Dan Elzen and the Carter Ranch Homeowners Association, based on the legal decisions from September 2019 and January 2020. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms.
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Short-Answer Quiz
Instructions: Answer the following questions in 2-3 sentences each, based on the provided case documents.
1. Who were the Petitioner and the Respondent in this case, and what was the official case number?
2. What specific action by the Petitioner prompted the initial notice of violation from the homeowners association?
3. What was the Petitioner’s primary legal argument against the validity of the Association’s “Flag Display Rule”?
4. According to the Carter Ranch CC&Rs, what authority does the Board have to create rules and regulations?
5. What is the “preponderance of the evidence,” and which party had the burden of meeting this standard?
6. List at least five of the flags that are explicitly permitted for display under the Carter Ranch “Flag Display Rule.”
7. Summarize the key provisions of Arizona Revised Statute § 33-1808(C) regarding “political signs.”
8. What was the Administrative Law Judge’s conclusion regarding the Petitioner’s claim that the Association improperly adopted the Flag Display Rule?
9. What was the final outcome of the petition after both the initial hearing on September 9, 2019, and the rehearing on January 10, 2020?
10. Who was the Administrative Law Judge that presided over both hearings?
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Answer Key
1. The Petitioner was Thomas J. Van Dan Elzen, and the Respondent was the Carter Ranch Homeowners Association. The case number was 19F-H1919071-REL, with the rehearing designated as 19F-H1919071-REL-RHG.
2. The case was prompted by Mr. Van Dan Elzen displaying a “Trump 2020” flag on a flagpole in his front yard. On or about May 21, 2019, Carter Ranch notified him that this action violated the Association’s rules.
3. The Petitioner argued that the Flag Display Rule was invalid because the community’s Covenants, Conditions, and Restrictions (CC&Rs) do not specifically mention the word “flag.” He asserted that the Association’s rules and regulations can only be based on topics explicitly mentioned in the CC&Rs.
4. Article V, Section 5.3 of the CC&Rs grants the Board the authority to adopt, amend, and repeal rules pertaining to the management of common areas, minimum maintenance standards for lots, the health, safety, or welfare of residents, and restrictions on the use of lots.
5. “Preponderance of the evidence” is evidence that is more convincing and shows that the fact sought to be proved is more probable than not. The Petitioner, Mr. Van Dan Elzen, bore the burden of proving his case by this standard.
6. The Carter Ranch Flag Display Rule permits the display of the American Flag, an official replica of a U.S. military flag (Army, Navy, Air Force, Marine Corps, or Coast Guard), a POW/MIA flag, an Arizona Indian nations flag, the Arizona State flag, and the Gadsden Flag.
7. A.R.S. § 33-1808(C) states that an association cannot prohibit the display of political signs on a member’s property, but it can prohibit them earlier than 71 days before an election and later than 3 days after an election. An association may also regulate the size and number of signs to be no more restrictive than local ordinances, or to a maximum aggregate of nine square feet if no such ordinances exist.
8. The Administrative Law Judge concluded that the Petitioner had not established that the Association improperly adopted the Flag Display Rule under its CC&Rs. The judge found that the rule was not inconsistent with the CC&Rs.
9. In both instances, the Administrative Law Judge ordered that the Petitioner’s petition be dismissed. The Respondent, Carter Ranch Homeowners Association, was deemed the prevailing party in the matter.
10. The Administrative Law Judge for both the initial hearing and the rehearing was Velva Moses-Thompson.
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Suggested Essay Questions
Instructions: The following questions are designed to test a deeper, analytical understanding of the case. Formulate a comprehensive response for each.
1. Analyze the Petitioner’s legal strategy. Why did his argument that the CC&Rs do not explicitly mention the word “flag” ultimately fail to meet the “preponderance of the evidence” standard?
2. Explain the relationship between the Carter Ranch CC&Rs, the Association’s Rules and Regulations, and Arizona Revised Statute § 33-1808. How do these documents interact to govern what a resident can display on their property?
3. Discuss the concept of “burden of proof” in this case. How did the “preponderance of the evidence” standard apply to Thomas J. Van Dan Elzen’s petition, and why did the Administrative Law Judge conclude he did not meet it?
4. Could the “Trump 2020” flag have been considered a “political sign” under the definition provided in A.R.S. § 33-1808(C)? Based on the text, evaluate the potential arguments for and against this classification and how the statute’s time restrictions on display might have been relevant.
5. Examine the authority granted to the Carter Ranch HOA Board by Article V, Section 5.3 of its CC&Rs. How did the HOA use this section to justify its Flag Display Rule, and how did the Administrative Law Judge evaluate this justification?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
The judge who presides over administrative hearings. In this case, the ALJ was Velva Moses-Thompson.
A.R.S. § 33-1808
The Arizona Revised Statute that, notwithstanding community documents, protects the right of homeowners to display certain flags (American, military, POW/MIA, state, etc.) and regulates how an association may restrict political signs.
Burden of Proof
The obligation of a party in a legal proceeding to provide evidence to prove their claim. In this case, the Petitioner had the burden of proof.
Covenants, Conditions, and Restrictions (CC&Rs)
The governing legal documents that set up the guidelines for a planned community or homeowners association. In this case, Article V, Section 5.3 of the CC&Rs gave the Board authority to create rules.
Flag Display Rule
The specific Carter Ranch Association rule prohibiting any flag other than the American Flag, specific military flags, POW/MIA flag, Arizona Indian National flag, Arizona State flag, and the Gadsden Flag.
Petitioner
The party who files a petition to initiate a legal proceeding. In this case, the petitioner was Thomas J. Van Dan Elzen.
Political Sign
As defined in A.R.S. § 33-1808(C), “a sign that attempts to influence the outcome of an election, including supporting or opposing the recall of a public officer or supporting or opposing the circulation of a petition for a ballot measure, question or proposition or the recall of a public officer.”
Preponderance of the Evidence
The standard of proof required in this proceeding. Defined in the decision as “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.”
Rehearing
A second hearing of a case. In this matter, a rehearing was held on January 10, 2020, after the initial decision was made on September 30, 2019.
Respondent
The party against whom a petition is filed. In this case, the respondent was the Carter Ranch Homeowners Association.
Case Participants
Petitioner Side
Thomas J. Van Dan Elzen(petitioner)
Respondent Side
Augustus H. Shaw IV(HOA attorney) Shaw & Lines LLC
Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.
Case Summary
Case ID
19F-H1919044-REL
Agency
ADRE
Tribunal
OAH
Decision Date
2019-05-07
Administrative Law Judge
Thomas Shedden
Outcome
partial
Filing Fees Refunded
$0.00
Civil Penalties
$500.00
Parties & Counsel
Petitioner
Pointe Tapatio Community Association
Counsel
Lauren Vie
Respondent
Lanye C. Wilkey and Devin E. Wilkey
Counsel
Joseph Velez
Alleged Violations
CC&R Article 3, section 3.1
Outcome Summary
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
The ALJ found that the Respondents violated the CC&Rs by operating a business that created traffic and parking. The Respondents were ordered to cease business operations and pay a $500.00 civil penalty. The Petitioner's request for a refund of its filing fee was denied.
Why this result: Petitioner's request for refund of the filing fee was denied because they cited no authority showing that the refund was within the tribunal’s authority.
Key Issues & Findings
Violation of Residential Use covenant prohibiting traffic/parking generation by business
The Petitioner HOA alleged that the Respondents, co-owners of the unit, violated CC&Rs Article 3, section 3.1 by operating a payroll processing company out of the unit. The ALJ found that the business required two employees to drive to the unit daily, thereby creating traffic and parking, which clearly and unambiguously violates the CC&R provision prohibiting non-residential use that creates traffic or parking.
Orders: Respondents were ordered to cease business operations at the unit (720 E. North Lane, Unit 1) within thirty-five days to comply with CC&R Article 3, section 3.1, and pay a civil penalty of $500.00 to the Department of Real Estate within sixty days. The Petitioner's request for refund of the filing fee was denied.
Filing fee: $0.00, Fee refunded: No, Civil penalty: $500.00
Disposition: petitioner_win
Cited:
ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003)
Grubb & Ellis Management Services, Inc. v. 407417 B.C., L.L.C., 213 Ariz. 83, 138 P.3d 1210 (App. 2006)
ARIZ. REV. STAT. § 32-2199.02
ARIZ. REV. STAT. section 32-2199.04
ARIZ. REV. STAT. section 41-1092.09
Video Overview
Audio Overview
Decision Documents
19F-H1919044-REL Decision – 706518.pdf
Uploaded 2026-01-23T17:28:45 (36.5 KB)
19F-H1919044-REL Decision – 706560.pdf
Uploaded 2026-01-23T17:28:49 (108.8 KB)
Briefing Doc – 19F-H1919044-REL
Administrative Hearing Briefing: Pointe Tapatio Community Association vs. Wilkey
Executive Summary
This document details the findings and decision of an administrative law judge in the case of Pointe Tapatio Community Association versus residents Layne C. and Devin E. Wilkey. The core issue was the operation of a payroll processing company, Devau Human Resources, from the Wilkeys’ residential unit. The Association alleged this violated community CC&Rs, which prohibit non-residential uses that create traffic or parking. The Wilkeys admitted that two employees commuted to the unit daily but argued they had received permission from a former property manager.
The judge found in favor of the Association, concluding that the daily commute of two employees constituted the creation of “traffic and parking,” a direct and unambiguous violation of the CC&Rs. The judge deemed the residents’ claims of verbal permission to be unsubstantiated and irrelevant, as the covenant’s language was clear. Consequently, the judge ordered the Wilkeys to cease all business operations at the unit within 35 days and imposed a civil penalty of $500.
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Case Overview
Case Name
Pointe Tapatio Community Association, Petitioner, vs. Lanye C. Wilkey and Devin E. Wilkey, Respondent.
Case Number
19F-H1919044-REL
Jurisdiction
Office of Administrative Hearings (Arizona Department of Real Estate)
Hearing Date
April 26, 2019
Decision Date
May 7, 2019
Administrative Law Judge
Thomas Shedden
Petitioner’s Counsel
Lauren Vie, Esq.
Respondent’s Counsel
Joseph Velez, Esq.
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Central Allegation and Governing Covenant
The Pointe Tapatio Community Association (Petitioner) alleged that Layne C. Wilkey and Devin E. Wilkey (Respondents) violated the community’s Covenants, Conditions, and Restrictions (CC&Rs) by using their residential unit as an office for their business.
The specific provision at issue is Article 3, Section 3.1 of the CC&Rs, which states:
“Residential. Each Residence shall be used, improved, and devoted exclusively to first class residential use, and no gainful occupation, profession, trade, business, religion, or other non-residential use which creates traffic [or] parking … shall be conducted from any Residence [or part thereof.]”
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Key Findings of Fact
The Business Operation
• Respondents: Layne C. Wilkey (mother) and Devin E. Wilkey (son) are co-owners of the unit at 720 E. North Lane, Unit 1 (Lot 50).
• Company: They own and operate Devau Human Resources, a payroll processing company, from this unit. The business also operates from a second, commercial site in Tempe.
• History: The business was moved into the residential unit from a commercial location in late 2009.
• Public Presence: Devau’s website and Google Maps both list the 720 E. North Lane address as an office location, with stated office hours from 9:00 a.m. to 5:00 p.m., Monday through Friday. The website notes it is a “mailing address only.”
• Admission: Ms. Wilkey acknowledged during testimony that they consider the unit to be an office.
Employee Activity and Impact
• The Wilkeys acknowledged that two Devau employees commute to the unit to work.
• One employee works from 9:30 a.m. to 4:00 p.m., Monday through Thursday.
• A second employee works from 9:30 a.m. to 5:00 p.m., Monday through Friday.
• These employees at times park their vehicles on the community’s streets.
• The business does not have clients or customers who visit the unit.
The Dispute Over Permission
• Respondents’ Claim: The Wilkeys asserted they had permission to operate the business from Howard Flisser, a former property manager. They admitted they had no written confirmation and had never spoken to Mr. Flisser directly about it.
◦ Ms. Wilkey testified that in 2009, she asked her husband, who asked a salesperson, who then allegedly asked Mr. Flisser and relayed that it was permissible.
◦ Mr. Wilkey testified that his now-deceased father would not have taken the risk of moving the business without permission.
• Petitioner’s Rebuttal: Board member Paula Duistermars testified that Mr. Flisser stated a few days before the hearing that he could not recall giving permission and, on two occasions during the conversation, volunteered that he had never given permission.
• Authority: Ms. Duistermars also testified that Mr. Flisser lacked the authority to grant such permission; only the Board of Directors could do so.
Association’s Stance and Actions
• Notification: Through a letter dated August 8, 2018, the Association informed the Wilkeys of the violation and required compliance by August 31, 2018.
• Petition: The Association filed the petition that initiated the hearing on or about January 17, 2019.
• Other Businesses: The Association permits certain home-based businesses that do not generate traffic or parking, such as telecommuting and online teaching, without requiring Board permission.
• Complaints: Ms. Duistermars acknowledged she was unaware of any specific complaints regarding traffic, parking, or noise from the Wilkeys’ unit. However, she testified that the Board was first made aware of the business operation when another resident brought the issue to its attention.
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Legal Analysis and Conclusions
• Standard of Proof: The judge determined all issues based on a “preponderance of the evidence,” defined as evidence with the most convincing force.
• CC&Rs as Contract: The CC&Rs are a legally binding contract between the Association and the residents.
• Unambiguous Language: The judge found the language in CC&R Article 3, Section 3.1 to be clear and unambiguous. Such covenants must be enforced to give effect to the parties’ original intent.
• Direct Violation: The judge concluded that the evidence overwhelmingly showed the Wilkeys were operating a business from their unit. The admission that two employees drive to the unit and park on the street proves that the business creates both traffic and parking.
• Violation Trigger: The creation of any traffic or parking by the business is sufficient to constitute a violation. The CC&R does not require that the traffic or parking cause a secondary violation or generate resident complaints. Therefore, the lack of other complaints was deemed to have little probative value.
• Final Conclusion: Based on the facts, the Wilkeys are in clear violation of CC&R Article 3, Section 3.1.
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Final Order and Penalties
Based on the findings of fact and conclusions of law, the Administrative Law Judge issued the following orders:
1. Compliance Order: Respondent Layne C. Wilkey and Devin E. Wilkey must cease all business operations at 720 E. North Lane, Unit 1 (Lot 50) within thirty-five (35) days of the Order’s effective date.
2. Civil Penalty: The Respondents must pay a civil penalty of $500.00 to the Department of Real Estate within sixty (60) days of the Order’s effective date. Payment must be made by cashier’s check or money order.
3. Filing Fee: The Petitioner’s request for a refund of its filing fee was denied, as the judge found no legal authority to grant it.
The Order is binding unless a request for rehearing is filed with the Commissioner of the Department of Real Estate within 30 days of service.
Study Guide – 19F-H1919044-REL
Study Guide:Pointe Tapatio Community Association v. Wilkey
This guide provides a comprehensive overview of the administrative law case Pointe Tapatio Community Association v. Wilkey, Case No. 19F-H1919044-REL, heard before the Arizona Office of Administrative Hearings. It details the central conflict, the arguments presented by both parties, the legal standards applied, and the final judgment.
Case Summary
The Pointe Tapatio Community Association (Petitioner) filed a complaint against homeowners Layne C. Wilkey and Devin E. Wilkey (Respondent), alleging that they were violating the community’s Covenants, Conditions, and Restrictions (CC&Rs) by operating a business, Devau Human Resources, from their residential unit. The Association argued that the business, which employed two individuals who commuted to the property, generated traffic and parking, explicitly prohibited by the CC&Rs for non-residential activities. The Wilkeys contended they had received verbal permission years prior and that the business was not disruptive. The Administrative Law Judge found in favor of the Association, ruling that the Wilkeys were in clear violation of the community’s governing documents.
Key Parties & Entities
Name / Entity
Key Actions & Involvement
Pointe Tapatio Community Association
Petitioner
The homeowners’ association that filed the petition alleging a CC&R violation. Represented by Lauren Vie, Esq.
Layne C. Wilkey & Devin E. Wilkey
Respondent
Mother and son, co-owners of the unit at 720 E. North Lane, Unit 1. Operators of Devau Human Resources. Represented by Joseph Velez, Esq.
Thomas Shedden
Administrative Law Judge (ALJ)
Presided over the hearing, made findings of fact, drew conclusions of law, and issued the final order.
Arizona Department of Real Estate
Regulatory Body
Issued the initial Notice of Hearing and has legal authority over such disputes under ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11.
Paula Duistermars
Board Member, Pointe Tapatio
Testified on behalf of the Association, detailing the Board’s position and interactions regarding the violation.
Howard Flisser
Property Manager (Former or Current)
Named by the Wilkeys as the source of verbal permission to operate their business; Flisser denied recalling this.
Devau Human Resources
Business Entity
A payroll processing company owned by the Wilkeys, operating out of the residential unit and a commercial site in Tempe.
Office of Administrative Hearings
Adjudicative Body
The venue for the hearing, located at 1740 West Adams Street, Lower Level, in Phoenix, Arizona.
Case Timeline
• Late 2009: The Wilkeys move their business, Devau Human Resources, from a commercial location into their unit at Pointe Tapatio.
• August 8, 2018: Pointe Tapatio sends a letter informing the Wilkeys they are out of compliance with the CC&Rs and must comply by August 31, 2018.
• January 17, 2019 (approx.): Pointe Tapatio files a petition with the Arizona Department of Real Estate.
• February 28, 2019: The Arizona Department of Real Estate issues a Notice of Hearing.
• April 26, 2019: The administrative hearing is held before ALJ Thomas Shedden.
• May 7, 2019: ALJ Thomas Shedden issues the final decision and order.
Central Conflict: CC&R Article 3, Section 3.1
The core of the dispute revolved around the interpretation and enforcement of a specific restrictive covenant within the community’s governing documents.
• The Allegation: Pointe Tapatio alleged that the Wilkeys were using their unit as an office for a “gainful occupation,” which is not a “first class residential use.”
• The Specific Provision: Article 3, Section 3.1 of the CC&Rs states:
• The Triggering Condition: The prohibition is not absolute. It applies specifically to non-residential uses that create traffic or parking.
Arguments and Evidence
Arguments & Evidence Presented
Petitioner (Pointe Tapatio)
Employee Activity: The Wilkeys acknowledged two employees drive to the unit to work Monday through Friday, creating traffic and parking on community streets.
Public Information: Devau’s website and Google Maps listed the residential unit as an office address with set business hours (9:00 a.m. to 5:00 p.m.).
Owner Admission: Ms. Wilkey acknowledged during testimony that they consider the unit to be an office.
Lack of Authority: Board member Paula Duistermars testified that property manager Howard Flisser did not have the authority to grant permission for a business; only the Board could. She also testified that Flisser could not recall giving permission and had volunteered that he never did.
Respondent (The Wilkeys)
Verbal Permission: The Wilkeys claimed they received verbal permission from property manager Howard Flisser in 2009. They admitted they never spoke to him directly and had nothing in writing.
Implied Permission: Mr. Wilkey argued his father would not have taken the risk of moving the payroll business without permission, implying it must have been granted.
No Direct Complaints: It was acknowledged that the Association was not aware of specific complaints filed against the Wilkeys for traffic, parking, or noise issues.
Residential Use: Mr. Wilkey testified that he considers the unit one of his two primary residences, though he did not provide a responsive answer when asked how often he stayed there.
The Judge’s Decision & Legal Reasoning
ALJ Thomas Shedden concluded that the Wilkeys were in violation of the CC&Rs based on a “preponderance of the evidence.”
• The Wilkeys operate Devau Human Resources, a payroll processing company, from the unit.
• Two employees commute to the unit for work and sometimes park on community streets.
• The business is publicly listed at the residential address.
• The Wilkeys’ claim of verbal permission from Howard Flisser was not substantiated. Testimony from Paula Duistermars indicated Flisser could not recall, and in fact denied, giving such permission.
• The Association does permit some home businesses (e.g., telecommuting, online teaching) that do not create traffic or parking and do not require Board permission.
1. CC&Rs as a Contract: The CC&Rs constitute a binding contract between the homeowners and the Association.
2. Unambiguous Language: The language in Article 3, section 3.1 is clear and unambiguous. It prohibits businesses that create traffic or parking.
3. Violation Proven: The evidence clearly showed the Wilkeys’ business created both traffic and parking due to its two commuting employees. This is a direct violation of the unambiguous terms of the CC&R.
4. No Other Violation Needed: The fact that no other rules (e.g., specific parking ordinances) were broken is irrelevant. The creation of any traffic or parking by the business is sufficient to trigger the violation as written.
1. Cease Operations: The Wilkeys were ordered to comply with CC&R Article 3, section 3.1 by ceasing business operations at the unit within 35 days.
2. Civil Penalty: The Wilkeys were ordered to pay a civil penalty of $500.00 to the Department of Real Estate within 60 days.
3. Filing Fee Request Denied: The Association’s request to have its filing fee refunded was denied because it cited no legal authority showing the judge had the power to grant it.
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Answer the following questions in 2-3 complete sentences based on the information in the case file.
1. Who were the petitioner and the respondents in this case, and what was their relationship?
2. What specific activity led the petitioner to claim the respondents were violating the CC&Rs?
3. According to Article 3, section 3.1, what condition makes a non-residential use of a property a violation?
4. What was the respondents’ primary defense for operating their business from the unit?
5. Why did the Administrative Law Judge find the respondents’ primary defense unconvincing?
6. What two specific pieces of evidence demonstrated that the business created traffic and parking?
7. What is the legal standard of proof required in this type of administrative hearing, and what does it mean?
8. What two penalties were imposed on the Wilkeys in the final order?
9. Does the Pointe Tapatio Community Association prohibit all home-based businesses? Explain.
10. Who was Howard Flisser, and what was his significance to the respondents’ case?
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Answer Key
1. The petitioner was the Pointe Tapatio Community Association. The respondents were Layne C. Wilkey and Devin E. Wilkey, who were homeowners within the community and co-owners of the unit in question.
2. The Wilkeys were operating their payroll processing company, Devau Human Resources, out of their residential unit. This included having two employees commute to the property to work during business hours.
3. A non-residential use becomes a violation if it “creates traffic [or] parking.” The rule does not require a certain amount of traffic or parking, only that it is created by the business activity.
4. The respondents’ primary defense was that they had received verbal permission to operate the business from the community’s property manager, Howard Flisser, back in 2009.
5. The judge found the defense unconvincing because the Wilkeys had no written proof, had not spoken to Mr. Flisser directly, and testimony from a board member indicated Mr. Flisser could not recall—and later denied—ever giving such permission. Furthermore, the property manager likely lacked the authority to grant it.
6. The evidence was the Wilkeys’ own acknowledgement that two of their employees drive to the unit to work on a weekly basis. This commuting by non-resident employees necessarily creates traffic and, at times, requires them to park on community streets.
7. The standard of proof is a “preponderance of the evidence.” This means the greater weight of the evidence must be sufficient to incline a fair and impartial mind to one side of the issue over the other, even if it does not remove all reasonable doubt.
8. The Wilkeys were ordered to cease all business operations at the unit within 35 days. They were also ordered to pay a civil penalty of $500.00 to the Department of Real Estate within 60 days.
9. No, the association does not prohibit all home-based businesses. It allows for activities like telecommuting and teaching online classes, which do not require board permission because they do not create traffic or parking.
10. Howard Flisser was the property manager whom the Wilkeys claimed gave them verbal permission to run their business. His significance was central to their defense, but his alleged permission was unsubstantiated and contradicted by later testimony.
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Essay Questions
The following questions are designed for longer-form analysis. No answers are provided.
1. Analyze the concept of “preponderance of the evidence” as applied in this case. How did the evidence presented by Pointe Tapatio meet this standard, while the Wilkeys’ evidence did not?
2. Discuss the legal principle that CC&Rs are treated as contracts. Explain how Judge Shedden applied contract law principles, particularly regarding “unambiguous” language, to reach his conclusion.
3. Evaluate the Wilkeys’ defense strategy, focusing on their claim of verbal permission from Howard Flisser. Why was this argument legally insufficient? What kind of evidence would have been necessary to make it successful?
4. Examine the distinction the Pointe Tapatio Community Association makes between permissible home-based businesses (like telecommuting) and impermissible ones (like Devau Human Resources). What is the key factor in this distinction according to the CC&Rs, and how does it relate to the core purpose of residential covenants?
5. Based on the judge’s order, discuss the remedies available to a homeowner’s association in Arizona when a CC&R violation is proven. What penalties were imposed, and what penalty was requested but denied?
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Glossary of Key Terms
• Administrative Law Judge (ALJ): A judge and trier of fact who presides over administrative hearings, such as disputes handled by the Office of Administrative Hearings. The ALJ renders decisions, called orders, based on evidence and legal arguments.
• CC&Rs (Covenants, Conditions, and Restrictions): The governing legal documents that set out the rules for a planned community or subdivision. In this case, they are treated as a legally binding contract between the association and the homeowners.
• Civil Penalty: A monetary fine levied by a government agency or administrative court for a violation of a statute or rule. In this case, a $500 penalty was imposed on the Wilkeys for violating the community documents.
• Conclusions of Law: The section of a judicial decision where the judge applies legal principles and statutes to the established facts of the case to reach a judgment.
• Findings of Fact: The section of a judicial decision that formally lists the factual determinations made by the judge based on the evidence presented at the hearing.
• Order: The final ruling or judgment issued by an Administrative Law Judge that directs the parties on what actions they must take.
• Petitioner: The party who initiates a legal action or files a petition seeking a legal remedy. In this case, the Pointe Tapatio Community Association.
• Preponderance of the Evidence: The standard of proof in most civil and administrative cases. It requires the trier of fact to believe that it is more likely than not that a claim is true, based on the evidence presented.
• Respondent: The party against whom a petition is filed or an appeal is brought. In this case, Layne C. Wilkey and Devin E. Wilkey.
Blog Post – 19F-H1919044-REL
4 Surprising Lessons from an HOA Lawsuit That Shut Down a 10-Year-Old Home Business
Introduction: The Rise of the Home Office and the Rules You Didn’t Know Existed
In an age where the line between the living room and the corner office has all but vanished, millions of us have embraced working from home. But as we settle into our home-based routines, a critical question often goes unasked: Are you truly familiar with your homeowner’s association (HOA) rules regarding home-based businesses?
For the Wilkey family, owners of Devau Human Resources, the answer to that question proved to be a costly one. After operating their payroll processing company from their home for nearly a decade without a single complaint, they found themselves in a legal battle that ultimately shut them down. Their case serves as a powerful cautionary tale about what can happen when long-standing home businesses collide with the fine print of HOA rules.
1. It’s Not About Complaints, It’s About the Contract
One of the most chilling lessons from the Wilkey case is that the HOA’s action wasn’t triggered by angry neighbors complaining about noise or traffic. In fact, Board member Paula Duistermars testified that she was unaware of any such complaints. The issue arose simply because “a resident brought the issue to [the Board’s] attention.”
This reveals a crucial legal reality: your business’s existence, not its impact, can be the sole trigger for enforcement. It doesn’t take a chorus of angry neighbors—just one person notifying the Board of a potential rule violation is enough. The Covenants, Conditions, and Restrictions (CC&Rs) are a legally binding contract, and the court’s decision was not based on whether the business was a nuisance, but simply whether it complied with the contract’s terms. Your takeaway: You must operate as if the rulebook will be enforced literally, because it can be.
2. The Deciding Factor: A Single Clause About “Traffic and Parking”
The entire legal dispute hinged on the precise wording of one specific rule. The HOA wasn’t enforcing a vague, blanket ban on all home businesses; its power came from a single, carefully worded clause in the CC&Rs.
The relevant section, Article 3, section 3.1, stated:
“Each Residence shall be used, improved, and devoted exclusively to first class residential use, and no gainful occupation, profession, trade, business, religion, or other non-residential use which creates traffic [or] parking … shall be conducted from any Residence [or part thereof.]”
As a legal analyst, I can tell you why this clause was so powerful: its focus on a tangible impact (“creates traffic [or] parking”) made it highly defensible. A blanket prohibition on “all businesses” might be open to challenge, but this specific, impact-based rule was nearly impossible to argue against once the facts were established. The Wilkeys’ business was found in violation specifically because it created traffic and parking, which is also why the HOA permitted other home businesses, like telecommuting, that did not.
3. Your Two-Person TeamIsa Traffic Problem
Many homeowners assume that business traffic rules are meant to prevent a steady stream of clients visiting a residential property. The Wilkeys had no clients come to their unit. However, this did not protect them.
The undisputed fact that proved decisive was that two of the company’s employees commuted to the home to work—one from Monday to Thursday and the other from Monday to Friday. The judge concluded that this daily employee commute constituted the creation of “traffic and parking” as prohibited by the CC&Rs. The employees at times parking on the community’s common streets provided concrete, undeniable evidence of this. This case sets a precedent that a micro-business with just one or two employees commuting to the home can be deemed in violation—a scenario many entrepreneurs wouldn’t even consider a “traffic” issue.
4. “He Said We Could” Is Not a Legal Defense
The Wilkeys asserted that they had received verbal permission to operate their business from the property manager back in 2009. This defense completely fell apart under legal scrutiny.
Courts prioritize written agreements and official board actions over “he said/she said” accounts, especially when they involve multi-level hearsay (in this case, a husband asking a salesperson who asked the manager). The defense failed for several clear reasons: the Wilkeys had no written proof, the manager denied recalling or ever giving such permission, and most importantly, a Board member testified that the manager lacked the authority to grant this permission anyway. Only the Board could.
The takeaway is unambiguous: Never rely on verbal assurances. Get all permissions from your HOA Board in writing, or they do not legally exist.
Conclusion: Know Your Rules Before You Unpack Your Desk
The story of the Wilkey family is a stark reminder that HOA documents are not mere suggestions; they are legally binding contracts where every word matters. The Wilkeys’ experience is a costly lesson for every home-based professional. Proactive compliance is your only true protection. The final outcome was an order for them to cease all business operations from their home within 35 days and pay a $500 civil penalty.
You might have been working from home for years without a problem, but have you ever read the fine print on what your community actually allows?
Case Participants
Petitioner Side
Lauren Vie(HOA attorney) Attorney for Petitioner
Paula Duistermars(board member) Pointe Tapatio Community Association Presented testimony for Petitioner
Beth Mulchay(HOA attorney) Mulchay Law Firm, P.C. Listed on transmission list
Respondent Side
Layne C. Wilkey(respondent)
Devin E. Wilkey(respondent)
Joseph A Velez(respondent attorney) For Respondent
Neutral Parties
Thomas Shedden(ALJ)
Judy Lowe(Commissioner) Arizona Department of Real Estate
Other Participants
Howard Flisser(property manager) Statements regarding alleged business permission were discussed
