ARIZ. REV. STAT. §§ 33-1804(A), 33-1804(B), 33-1804(F), and Association bylaws 2.3, 2.7, and 3.1
Outcome Summary
The Administrative Law Judge concluded that the Respondent HOA acted within the scope of its statutory authority during its April 02, 2020, annual meeting and elections, and denied the Petitioner's petition for failure to sustain the burden of proof regarding alleged statutory and bylaw violations.
Why this result: The ALJ found that notice of the meeting modification (to an online platform due to COVID-19) was timely and proper, and Petitioner's claimed denial of the right to speak was the result of user error of the online platform, not action by the Association. Furthermore, the decision to hold elections for all five open Board positions was deemed appropriate due to carryover vacancies resulting from a lack of quorum in the prior year (2019).
Key Issues & Findings
Alleged violations regarding Annual Meeting notice (change in venue), right to speak, proper call to order, and staggered board voting.
Petitioner filed a quadruple-issue petition alleging the Association violated statutes and bylaws concerning the April 02, 2020, annual meeting, specifically regarding insufficient notice for the venue change (due to COVID-19), denial of the right to speak (via online chat), improper chair delegation, and failure to stagger Board elections.
Orders: Petitioner’s petition is denied.
Filing fee: $2,000.00, Fee refunded: No
Disposition: petitioner_loss
Cited:
ARIZ. REV. STAT. § 33-1804(A)
ARIZ. REV. STAT. § 33-1804(B)
ARIZ. REV. STAT. § 33-1804(F)
ARIZ. REV. STAT. § 32-2199.05
ARIZ. ADMIN. CODE R4-9-117
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: COVID-19, Virtual Meeting, Notice, Right to Speak, Elections, Bylaws, Quorum, User Error
Additional Citations:
ARIZ. REV. STAT. § 33-1804(A)
ARIZ. REV. STAT. § 33-1804(B)
ARIZ. REV. STAT. § 33-1804(F)
ARIZ. REV. STAT. § 32-2199.05
ARIZ. REV. STAT. § 32-2199.02
ARIZ. ADMIN. CODE R4-9-117
Video Overview
Audio Overview
Decision Documents
20F-H2020061-REL Decision – 819907.pdf
Uploaded 2025-10-09T03:35:29 (149.3 KB)
Briefing Doc – 20F-H2020061-REL
Briefing Document: Paparazzo v. Coronado Ranch Community Association (Case No. 20F-H2020061-REL)
Executive Summary
This document synthesizes the findings from the Administrative Law Judge Decision in the matter of Samuel T. Paparazzo versus the Coronado Ranch Community Association. The central conclusion of the proceeding is the denial of the Petitioner’s claims. The Administrative Law Judge (ALJ) determined that the Petitioner failed to prove by a preponderance of the evidence that the Association violated Arizona state statutes or its own governing bylaws in the conduct of its April 2, 2020, annual meeting.
The critical takeaways from the decision are as follows:
• Meeting Format and Notice: The Association’s decision to move its annual meeting to a virtual platform (ClickMeeting) was deemed a lawful and appropriate response to the COVID-19 pandemic and the Arizona Governor’s related executive orders. The notification methods, which included physical signs and multiple emails, were found to be sufficient.
• Right to Speak: The Petitioner’s claim that he was denied the right to speak because he was “blocked” from the online chat feature was dismissed. The ALJ concluded the issue stemmed from “user error”—the Petitioner typed messages but failed to transmit them by pressing ‘enter’ or ‘send’. The fact that 26 other members successfully used the chat feature demonstrated its functionality.
• Meeting Conduct: The Association’s president properly called the meeting to order before delegating chairing responsibilities to the Association’s Managing Agent, an action the Petitioner conceded was within the president’s authority.
• Board Elections: The election of all five Board of Director positions simultaneously, rather than in staggered terms, was justified by unique circumstances. The Association’s 2019 annual meeting failed to achieve a quorum, preventing an election and resulting in a “carryover of open seats,” which necessitated filling all positions in the 2020 election.
Ultimately, the ALJ found that the Association and its Board acted within the scope of their statutory authority and that the challenges raised by the Petitioner were without merit.
I. Case Overview
This briefing analyzes the Administrative Law Judge Decision issued on September 3, 2020, following an evidentiary hearing held on August 18, 2020.
• Case Number: 20F-H2020061-REL
• Presiding Judge: Administrative Law Judge Jenna Clark
• Petitioner: Samuel T. Paparazzo (Homeowner and Association Member)
• Respondent: Coronado Ranch Community Association (HOA)
• Central Issue: The core of the dispute was whether the Coronado Ranch Community Association violated Arizona Revised Statutes and specific sections of its own bylaws during its annual meeting on April 2, 2020.
II. Petitioner’s Allegations
On May 15, 2020, Samuel Paparazzo filed a quadruple-issue petition alleging that the Association committed the following violations:
1. Improper Notice of Meeting: Providing less than 10-days’ notice regarding a “change in venue” for the annual meeting to only a small portion of the membership, in violation of ARIZ. REV. STAT. § 33-1804(B) and Association Bylaw 2.3.
2. Denial of Right to Speak: Preventing the Petitioner from exercising his right to speak by “blocking” or otherwise disabling his use of the online “chat feature” during the virtual meeting, in violation of ARIZ. REV. STAT. § 33-1804(A).
3. Improper Meeting Conduct: Failing to properly call the annual meeting to order, in violation of Association Bylaw 2.7.
4. Improper Board Election: Conducting the Board of Directors election without the “staggered” terms required by the bylaws, in violation of Association Bylaw 3.1.
III. Factual Chronology and Key Evidence
The decision outlines a clear sequence of events, heavily influenced by the onset of the COVID-19 pandemic.
Feb. 20, 2020
The Association issues its initial notice for the annual meeting, scheduled for April 2, 2020, at Coronado Elementary School.
Mar. 12, 2020
The Association mails election ballots to all Members.
Mar. 19, 2020
Arizona Governor Douglas Ducey issues Executive Order 2020-09, limiting certain business operations to slow the spread of COVID-19.
~Mar. 25, 2020
The Association’s President, Bob Hicks, officially moves the meeting to the virtual ClickMeeting platform.
Mar. 25 – Apr. 1
The Association notifies Members of the change via 12 signs at 6 community entrances and three separate email blasts to approximately 750 Members, which had an average open rate of 63.53%.
Mar. 30, 2020
Governor Ducey issues Executive Order 2020-18, the “Stay Home, Stay Healthy, Stay Connected” order.
Apr. 1, 2020
Two signs are placed at the entrance to the original meeting location, Coronado Elementary School, informing of the change.
Apr. 2, 2020
The Annual Meeting is held via ClickMeeting. • President Hicks calls the meeting to order and then appoints Managing Agent Kevin Bishop to chair the remainder of the meeting. • A quorum is achieved based on attendees and absentee ballots. • An election is held for all 5 open Board positions due to a lack of quorum at the 2019 meeting. • The Petitioner types messages in the chat window but fails to hit “enter” or click “send” to transmit them. He receives no response to an email for help sent during the meeting. • At least 26 other Members successfully use the chat feature.
IV. Analysis of Key Issues and Legal Conclusions
The Administrative Law Judge systematically addressed and dismissed each of the Petitioner’s four allegations, concluding that the Board acted lawfully and within its authority.
A. Meeting Notice and Venue Change
• Alleged Violation: ARIZ. REV. STAT. § 33-1804(B) and Bylaw 2.3 (Notice of Meetings).
• Finding: The petition was denied on this point. The ALJ concluded that the notice of the Association’s 2020 annual meeting was “timely and properly noticed.” The move to an online platform was not an arbitrary venue change but a necessary and reasonable measure to comply with the Governor’s executive orders related to the COVID-19 pandemic.
• Supporting Evidence:
◦ The Association made a multi-faceted effort to inform Members through physical signs and repeated emails.
◦ The Petitioner received notice of the modification and, crucially, “failed to raise an objection prior to or during the meeting at issue.”
◦ A Member’s attendance at a meeting waives objections to defective notice, as stated in Bylaw 2.3.
B. Right to Speak
• Alleged Violation: ARIZ. REV. STAT. § 33-1804(A) (Open Meetings and Member Participation).
• Finding: The petition was denied on this point. The ALJ determined the Petitioner’s inability to communicate during the meeting was the result of “user error” and not a deliberate act by the Association to silence him.
• Supporting Evidence:
◦ The Petitioner wrote messages but never finalized the action by hitting the “enter” key or clicking the “send” button.
◦ The chat feature was demonstrably functional, as it was “successfully used by no less than 26 other Members during the annual meeting.”
◦ The decision explicitly states, “The Association is not responsible for Petitioner’s lack of ClickMeeting proficiency.”
C. Conduct of Meeting
• Alleged Violation: Bylaw 2.7 (Organization and Conduct of Meeting).
• Finding: The petition was denied on this point. The meeting was lawfully conducted.
• Supporting Evidence:
◦ The Association President, Bob Hicks, called the meeting to order and took roll before appointing Managing Agent Kevin Bishop to chair the rest of the meeting.
◦ The Petitioner “conceded during cross-examination that President Hicks had the authority task Agent Bishop with chairing the annual meeting.”
D. Board of Directors Election
• Alleged Violation: Bylaw 3.1 (Number and Terms of Office).
• Finding: The petition was denied on this point. The election for all five Board seats was deemed “lawful and appropriate given the circumstances.”
• Supporting Evidence:
◦ The bylaw’s provision for staggered terms could not be implemented because the 2019 annual meeting lacked a quorum, which meant no election took place that year.
◦ This lack of a 2019 vote “resulted in a carryover of open seats,” necessitating a vote for all five Board positions in 2020.
◦ The Petitioner “admitted that it had not been possible for the Association to stagger Board electees in the 2020 vote because no quorum had been reached to vote in 2019.”
V. Final Order and Disposition
Based on the findings of fact and conclusions of law, the Administrative Law Judge issued a final order.
• Order: “IT IS ORDERED that Petitioner’s petition be denied.”
• Legal Standard: The Petitioner bore the burden of proving his case by a “preponderance of the evidence.” The ALJ concluded that the record did not establish any violations and that the Petitioner “failed to sustain his burden of proof in this matter.”
• Date of Order: The decision was issued on September 3, 2020.
Study Guide – 20F-H2020061-REL
Study Guide: Paparazzo v. Coronado Ranch Community Association
This guide is designed to review the key facts, legal arguments, and conclusions presented in the Administrative Law Judge Decision for case number 20F-H2020061-REL, Samuel T Paparazzo v. Coronado Ranch Community Association.
Short-Answer Quiz
Answer the following questions in 2-3 sentences, based on the information provided in the case document.
1. Who were the primary parties in this case, and what were their roles?
2. What were the four specific allegations the Petitioner made against the Association regarding its Annual Meeting?
3. How did the Association notify its members of the change from an in-person meeting to a virtual one?
4. What was the legal justification for the Association’s decision to move the Annual Meeting to an online platform?
5. What evidence was presented to counter the Petitioner’s claim that he was “blocked” from using the online chat feature?
6. According to the Association’s bylaws, who has the authority to chair the annual meeting and delegate that responsibility?
7. Why did the 2020 Board of Directors election involve voting for all five open positions instead of being staggered?
8. What is the “preponderance of the evidence” standard, and who bore the burden of proof in this hearing?
9. What two key Arizona Revised Statutes (ARIZ. REV. STAT.) relate to member meeting notices and the right to speak?
10. What was the final order issued by the Administrative Law Judge, and what was the core reasoning behind it?
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Answer Key
1. The primary parties were Samuel T. Paparazzo, the Petitioner, who is a property owner and member of the Association, and the Coronado Ranch Community Association, the Respondent, which is the homeowners’ association for the subdivision. The Petitioner brought the complaint, and the Respondent defended its actions.
2. The Petitioner alleged that: (i) inadequate notice of the “change in venue” was given; (ii) he was denied his right to speak by being blocked from the online chat feature; (iii) the meeting was not properly called to order; and (iv) the Board of Directors vote was not properly “staggered.”
3. The Association notified members of the move to the ClickMeeting platform by placing 12 signs at 6 common entrances, sending three separate emails to approximately 750 members, and placing 2 signs at the entrance of the originally scheduled location, Coronado Elementary School.
4. The legal justification was the need to comply with executive orders issued by Arizona Governor Douglas Ducey (2020-09, 2020-12, and 2020-18) to slow the spread of COVID-19. The online platform was adopted to allow homeowners to safely access the meeting while adhering to physical distancing mandates.
5. The evidence showed that the Petitioner wrote messages but never hit the “enter” key or “send” button to transmit them. Furthermore, the record indicates that no less than 26 other members successfully used the chat feature during the meeting.
6. According to Bylaw Section 2.7, the President of the Association, Bob Hicks, has the authority to call the meeting to order and chair it. The Petitioner conceded during cross-examination that President Hicks had the authority to delegate the chairing of the meeting to the Association’s Managing Agent, Kevin Bishop.
7. The election involved all five positions because a quorum had not been achieved at the Association’s 2019 annual meeting. This lack of a quorum prevented a vote from taking place, resulting in a carryover of all open board seats to the 2020 election.
8. A “preponderance of the evidence” is the standard of proof required, meaning the evidence must be more probably true than not. In this proceeding, the Petitioner, Samuel Paparazzo, bore the burden of proving his allegations by this standard.
9. ARIZ. REV. STAT. § 33-1804(B) requires notice to be sent not fewer than 10 nor more than 50 days in advance of a meeting. ARIZ. REV. STAT. § 33-1804(A) ensures that all meetings are open to members and that members are permitted to attend and speak at an appropriate time.
10. The final order was that the Petitioner’s petition be denied. The judge reasoned that the Petitioner failed to sustain his burden of proof, as the evidence showed the Association’s actions were lawful and appropriate responses to the circumstances, and the Petitioner’s inability to participate was due to user error.
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Essay Questions
The following questions are designed for deeper analysis of the case. No answers are provided.
1. Analyze the role of the COVID-19 pandemic and the associated executive orders in the events of this case. How did these external factors influence the Association’s actions and the Administrative Law Judge’s final decision?
2. The judge concluded that the Petitioner’s inability to use the chat function was due to “user error.” Discuss the evidence that supports this conclusion and explore the legal line between an association’s responsibility to provide access and a member’s responsibility to utilize the provided tools correctly.
3. Explain the relationship between the Association’s governing documents (CC&Rs and Bylaws) and Arizona state law (ARIZ. REV. STAT.). How did the judge use both to evaluate the legality of the Association’s handling of the annual meeting and election?
4. The Petitioner argued that the online platform constituted a “change in venue” that required more extensive notice. Based on the judge’s decision, evaluate the legal merits of this argument in the context of a virtual meeting necessitated by a public health crisis.
5. Discuss the concept of “quorum” as it applied to both the 2019 and 2020 annual meetings. How did the failure to achieve quorum in one year directly impact the procedures and outcome of the election in the following year?
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Glossary of Key Terms
Definition from Context
Administrative Law Judge (ALJ)
An independent judicial officer (Jenna Clark in this case) from the Office of Administrative Hearings who conducts evidentiary hearings and issues decisions on matters referred by state agencies like the Department of Real Estate.
ARIZ. REV. STAT.
Abbreviation for Arizona Revised Statutes, the collection of laws for the state of Arizona. Title 33, Chapter 16, Article 1 specifically regulates planned communities (homeowners’ associations).
Association
The Coronado Ranch Community Association, the homeowners’ association for the residential development in Gilbert, Arizona. It is governed by its CC&Rs and overseen by a Board of Directors.
Bylaws
The governing documents of the Association that detail the structure of day-to-day governance, including voting processes, quorum requirements, meeting provisions, and other operating guidelines.
Covenants, Conditions, and Restrictions. These form an enforceable contract between the Association and each property owner, empowering the Association to control certain aspects of property use within the development.
Declarant Control Period
An initial period in an association’s history where the developer (the “Declarant”) controls the Board of Directors. In this case, this period ended for the Association in 2005.
Department
The Arizona Department of Real Estate, the state agency authorized by statute to receive and decide petitions for hearings from members of homeowners’ associations.
The Office of Administrative Hearings, an independent state agency that was referred this matter to conduct an evidentiary hearing and decide the case.
Petitioner
Samuel T. Paparazzo, the property owner and Association member who filed the petition with the Department, alleging violations by the Association.
Preponderance of the Evidence
The burden of proof required in this hearing. It is defined as proof that convinces the trier of fact that a contention is “more probably true than not,” representing the greater weight of evidence.
Quorum
The minimum number of members required to be present or represented by ballot for a meeting to be valid and for votes to be taken. The failure to achieve quorum at the 2019 meeting resulted in a carryover of open board seats.
Respondent
The Coronado Ranch Community Association, the party against whom the petition was filed. The Respondent denied all allegations and was represented by legal counsel.
Blog Post – 20F-H2020061-REL
He Sued His HOA Over a Virtual Meeting—The Judge’s Ruling Contains 4 Critical Lessons for Every Homeowner
Introduction: The New Battlefield for Neighborhood Disputes
Cast your mind back to the chaotic spring of 2020. The world was locking down, businesses were scrambling to go remote, and the delicate social contracts of our neighborhoods were fraying. For millions living in Homeowners’ Associations, this meant the abrupt cancellation of in-person meetings, replaced by a frantic pivot to unfamiliar virtual platforms. In this pressure cooker of uncertainty and technical glitches, minor grievances quickly escalated into major legal battles.
The case of Paparazzo vs. Coronado Ranch Community Association is a quintessential legal drama of that era. A frustrated homeowner, believing he was silenced and his rights ignored during a virtual meeting, took his HOA to court. The judge’s decision, however, serves as a powerful cautionary tale. It distills four surprising and impactful lessons that every homeowner should understand as community governance becomes increasingly digital.
1. The Takeaway: You Can’t Claim You Were Silenced If You Forgot to Hit ‘Send’
The petitioner, Samuel Paparazzo, leveled a serious charge: that the HOA had denied his right to speak by “blocking” him from using the online chat feature during the annual meeting. In his view, this was an intentional act of suppression.
The digital evidence, however, told a very different story. While Mr. Paparazzo had typed several messages, he had never actually transmitted them by hitting the “enter” key or clicking the “send” button. While he did email for assistance during the meeting without receiving a timely response, the court found the chat feature was fully functional, proven by the fact that at least 26 other members used it successfully. The judge’s ruling was a stark lesson in digital accountability:
Petitioner’s inability to effectively communicate with the Association during the annual meeting was the result of user error. … The Association is not responsible for Petitioner’s lack of ClickMeeting proficiency.
This establishes a critical precedent for our digital age. The analysis here goes beyond simple “user error.” It suggests that a baseline of digital literacy is becoming a prerequisite for effective civic participation. Courts may have little sympathy for claims of disenfranchisement that stem from a failure to master the basic tools of modern communication.
2. The Takeaway: An Emergency Can Justify Last-Minute Changes
Next, the petitioner challenged the HOA on procedural grounds—a classic move in community disputes. He argued that the association failed to provide proper notice for the virtual meeting. The HOA had correctly noticed its in-person meeting for April 2, 2020, back on February 20. But by late March, holding that meeting had become impossible.
The judge’s response to this claim is a masterclass in how legal “reasonableness” can override rigid bylaws during a crisis. The court noted the rapidly evolving timeline of the pandemic: Governor Ducey issued executive orders limiting business operations on March 19, prohibiting the closure of essential services on March 23, and issuing the “Stay Home” order on March 30. Faced with these superseding government mandates, the HOA moved the meeting online on March 25.
Crucially, the HOA’s communication efforts were extensive and documented. They didn’t just send a single email. The board notified its members by:
• Placing 12 signs at 6 common entrances to the community.
• Sending three separate email blasts to approximately 750 members, which had an average open rate of 63.53%.
• Placing 2 additional signs at the entrance to the originally scheduled location, Coronado Elementary School.
The judge concluded that the HOA’s actions were a justifiable response to an unprecedented emergency. This wasn’t a board ignoring its rules; it was a board taking necessary steps to comply with government orders and protect its members, legally justifying the short-notice change in format.
3. The Takeaway: Just Showing Up Can Waive Your Right to Complain
This lesson hinges on a legal concept every homeowner must understand: waiver by attendance. Buried in the association’s bylaws was Section 2.3, which states: “A Member’s attendance at a meeting waives objection to the lack of notice or defective notice of the meeting.”
This is not mere legalese; it’s a common and powerful clause designed to ensure the finality of meetings. It prevents a member from strategically attending a meeting, remaining silent about a potential procedural flaw, and then launching a lawsuit later if they don’t like the outcome. The judge noted that the petitioner attended the virtual meeting but did not object to the notice “prior to or during” the event. By participating without raising a formal objection at the time, he legally accepted the meeting’s procedures and waived his right to challenge them later.
4. The Takeaway: The Past Can Haunt the Present
The petitioner’s final major complaint appeared to be a slam dunk: the election for the Board of Directors was not “staggered” as explicitly required by Bylaws Section 3.1. Instead of a mix of one- and two-year terms to ensure continuity, all five open board positions were elected at once. On its face, this was a clear violation.
But the reason for this anomaly demonstrates the domino effect of governance. The judge found that in the previous year, 2019, the association had failed to achieve a quorum for its annual meeting. Because there was no quorum, no vote could occur, creating a “carryover of open seats.” This failure in 2019 created a governance debt that had to be paid in 2020. The only lawful way to do so was to elect members to all five vacant positions. This shows that an HOA is a continuous legal entity; one year’s procedural failure doesn’t just disappear—it creates unusual but legally necessary circumstances the next.
Conclusion: A Final Thought for the Digital Neighborhood
The case of Paparazzo vs. Coronado Ranch Community Association offers a clear and compelling look at the collision between established community rules, the new realities of digital life, and the chaos of unforeseen global events. It shows that while bylaws and statutes provide a framework, their application can be shaped by emergencies, past events, and even a single user’s technical skills.
As our communities increasingly operate online, who bears the greater responsibility for ensuring effective communication—the organization hosting the meeting, or the individual attending it?
Case Participants
Petitioner Side
Samuel Paparazzo(petitioner) Also referred to as Samuel T Paparazzo
Respondent Side
Mark Stahl(HOA attorney) Coronado Ranch Community Association Also spelled Mark Sahl in source
Timothy Butterfield(HOA attorney) Coronado Ranch Community Association
Kevin Bishop(community manager) Coronado Ranch Community Association Appeared as a witness for Respondent; Also referred to as 'Agent Bishop' and chaired part of the annual meeting
Bob Hicks(HOA Board President) Coronado Ranch Community Association Delegated chairing of the annual meeting
Neutral Parties
Jenna Clark(ALJ) Office of Administrative Hearings
Judy Lowe(Commissioner) Arizona Department of Real Estate
Petitioner MacLeod's challenge to the HOA's Amendment (Petition #19) was dismissed. The HOA's cross-petition (Petition #34) was partially affirmed, finding MacLeod in violation of the Amendment by living full-time in his hangar/home. The HOA (Mogollon Airpark, Inc.) was deemed the prevailing party in the cross-petitions, and each party was ordered to bear its own filing fee.
Why this result: Petitioner MacLeod failed to prove the Amendment was improperly adopted, and the HOA successfully proved MacLeod was in violation of the Amendment regarding full-time residency.
Key Issues & Findings
Challenge to the proper adoption of the October 18, 2018 Amendment to the Declaration (Petition #19)
Petitioner MacLeod alleged that the Amendment substantially altering residential usage in Tract Hangar/Homes was improperly adopted because it applied to fewer than all lots and thus required unanimous approval under A.R.S. § 33-1817(A)(2).
Orders: Petition #19 was dismissed because the Amendment was found to be properly adopted requiring 75% approval pursuant to the Declaration and A.R.S. § 33-1817(A)(1) [40, 44a].
Petitioner MacLeod's challenge to the HOA's Amendment (Petition #19) was dismissed. The HOA's cross-petition (Petition #34) was partially affirmed, finding MacLeod in violation of the Amendment by living full-time in his hangar/home. The HOA (Mogollon Airpark, Inc.) was deemed the prevailing party in the cross-petitions, and each party was ordered to bear its own filing fee.
Why this result: Petitioner MacLeod failed to prove the Amendment was improperly adopted, and the HOA successfully proved MacLeod was in violation of the Amendment regarding full-time residency.
Key Issues & Findings
Challenge to the proper adoption of the October 18, 2018 Amendment to the Declaration (Petition #19)
Petitioner MacLeod alleged that the Amendment substantially altering residential usage in Tract Hangar/Homes was improperly adopted because it applied to fewer than all lots and thus required unanimous approval under A.R.S. § 33-1817(A)(2).
Orders: Petition #19 was dismissed because the Amendment was found to be properly adopted requiring 75% approval pursuant to the Declaration and A.R.S. § 33-1817(A)(1) [40, 44a].
Administrative Law Judge Decision: MacLeod v. Mogollon Airpark, Inc.
Executive Summary
This briefing document outlines the findings and decision of an Administrative Law Judge (ALJ) in the cross-petitions between Magnus L.D. MacLeod and Mogollon Airpark, Inc. (MAP). The central dispute revolves around the validity of a 2018 Amendment to the community’s Declaration and MacLeod’s alleged violation of this Amendment by residing full-time in an aircraft hangar.
MacLeod (Petition #19) contended that the Amendment was invalid because it was not unanimously approved by all lot owners, as he argued was required by Arizona statute A.R.S. § 33-1817(A)(2) since it applied to fewer than all properties. MAP (Petition #34) argued the Amendment was properly adopted with the required 75% approval and that MacLeod was in violation by living in his Tract G hangar, which also allegedly failed to meet the minimum living space requirement.
The ALJ ruled decisively in favor of Mogollon Airpark, Inc., deeming it the prevailing party. The judge concluded that the Amendment was properly adopted under the 75% approval threshold outlined in the community’s Declaration and A.R.S. § 33-1817(A)(1), thereby dismissing MacLeod’s petition. On MAP’s petition, the ALJ found that MacLeod had indeed violated the Amendment by living full-time in the hangar, affirming that part of the petition. However, the ALJ dismissed MAP’s claim regarding the hangar’s living space size due to insufficient evidence. The final order dismisses Petition #19, partially affirms and partially dismisses Petition #34, and orders each party to bear their own filing fees.
Case Overview
Case Numbers
No. 20F-H2019019-REL (Root), No. 20F-H2019034-REL
Parties
Petitioner: Magnus L.D. MacLeod Respondent: Mogollon Airpark, Inc. (MAP)
Jurisdiction
Arizona Department of Real Estate, Office of Administrative Hearings
Administrative Law Judge
Kay Abramsohn
Hearing Date
June 19, 2020
Decision Date
July 28, 2020
The Cross-Petitions
The legal conflict originated from two separate petitions filed with the Arizona Department of Real Estate.
Petition #19: Filed by Magnus L.D. MacLeod
• Filing Date: On or about October 15, 2019.
• Core Allegation: MAP violated Arizona statute A.R.S. § 33-1817(A)(1), (A)(2)(a), and (A)(2)(b) in its adoption of the October 18, 2018 “Amendment to Declaration of Establishment of Conditions, Reservations and Restrictions…”
• MacLeod’s Argument: The Amendment could not be enforced because it lacked the affirmative vote or written consent of all owners of the property to which it applied. He specifically noted that three of the nine Real Property Tracts (Tract G, Tract H, and Tract M) did not provide an affirmative vote and that he personally did not sign it. He argued the amendment required unanimous approval.
Petition #34: Filed by Mogollon Airpark, Inc. (MAP)
• Filing Date: On or about December 16, 2019.
• Core Allegations:
1. Violation of the Amendment: MacLeod was in continued violation of the properly adopted Amendment by living full-time in his Tract G aircraft storage hangar.
2. Violation of Square Footage Requirement: MAP alleged, upon information and belief, that the living space in the hangar was “only 549 square feet,” which violated the Declaration’s requirement that structures for living purposes contain no less than 1,200 square feet.
• Requested Relief: MAP sought enforcement of the Declaration and Amendment, including injunctive relief to compel MacLeod’s compliance, and an award of its attorney’s fees and costs.
Analysis of the Disputed Amendment
The conflict centers on an amendment recorded on October 18, 2018. This amendment introduced several significant changes to the community’s governing documents.
Key Provisions of the Amendment
• Creates Two Lot Categories: The Amendment establishes “Residential lots” (lots #178 through #213) and “Hangar Tracts” (Tracts E through M).
• Regulates Hangar Use: It designates Tracts E through M for the purpose of “aircraft storage only.”
• Restricts Occupancy: While guest quarters may be constructed within a hangar, they are for “temporary living only.” “Temporary” is explicitly defined as “not longer than four months per calendar year.” An owner can request an extension in special circumstances.
• Maintains Living Space Requirement: It affirms that any single-family structure or combination hangar/house must have a living area of “not less than 1,200 square feet.”
• Adds Taxiway Access: The Amendment adds Lot 213 to the list of properties authorized to use the aircraft taxiway. This change was necessitated by a fence MacLeod had erected that blocked the Lot 213 owner’s access.
MacLeod’s Objections to the Amendment
In his petition, MacLeod argued the Amendment fundamentally and unreasonably altered the original covenants:
• It “substantially alters” the covenants for Tract Hangar/Homes by imposing the new four-month temporary living limit where unrestricted usage was previously allowed.
• It replaced the allowance for “Guest Homes with Kitchens” with “Guest Quarters without Kitchens,” impacting Tract G.
• It created a “large burden upon me to buy or build an additional home that I do not want and do not need.”
Background and History of the Dispute
• Property Acquisition: MacLeod purchased Tract G from his brother, Pat MacLeod, in February 2017 with the stated expectation of living in the hangar/home full-time.
• Occupancy: After acquiring the property, MacLeod made interior improvements and began living full-time in the aircraft hangar.
• Conflict Origin: The issue of MacLeod’s full-time residency first arose in May 2017 when he requested to build a group home for disabled veterans, a request that drew opposition from other lot owners.
• Initial Violation Notice: On September 18, 2017, MAP’s Architectural Committee sent MacLeod a letter notifying him that living full-time in a hangar intended for aircraft storage was a violation and requested he vacate within 60 days.
• Formal Non-Compliance Notices & Fines:
◦ December 29, 2018: MAP issued a “First Notice of Non-Compliance,” imposing a $100 fine.
◦ April 29, 2019: MAP issued a “Second Notice: Non-Compliance,” imposing an additional $200 fine if the violation was not remedied.
Legal Framework and Adjudicated Issues
The central legal question was the standard of approval required to pass the Amendment. The parties stipulated that the core dispute was whether a 75% approval or a unanimous approval was necessary.
Stipulated Fact #11
The parties agreed to the following crucial point, which narrowed the scope of the legal argument:
“The AMENDMENT contains at least the required minimum signatures and authorizations from the Lot Owners in Unit IVB to adopt the AMENDMENT, provided that unanimous approval of all affected property owners was not required.”
Conflicting Legal Standards
• Declaration Requirement (75% Rule): The original Declaration states it can be amended “by an instrument in writing, executed and acknowledged by the owners of not less than three-fourths of the lots in said subdivision…”
• Arizona Statute (Unanimous Rule): A.R.S. § 33-1817(A)(2) requires unanimous “affirmative vote or written consent of all of the owners of the lots or property to which the amendment applies” if the amendment “apply to fewer than all of the lots or less than all of the property that is bound by the Declaration.”
Parties’ Core Arguments
• MacLeod’s Position: The Amendment required unanimous approval under A.R.S. § 33-1817(A)(2) because it applied to “fewer than all the lots,” specifically pointing out that Tract B (a common area) was not included.
• MAP’s Position: The 75% rule under A.R.S. § 33-1817(A)(1) was the applicable standard. MAP argued that Tract B was a common area not subject to the Declaration’s conditions, so its exclusion from an amendment concerning residential use was irrelevant and did not trigger the unanimity requirement.
Administrative Law Judge’s Decision and Rationale
The ALJ’s conclusions systematically addressed each petition.
Ruling on Petition #19 (Amendment Validity)
• Conclusion: The Amendment was properly adopted.
• Rationale: The ALJ concluded that the 75% approval threshold, as specified in the Declaration and permitted by A.R.S. § 33-1817(A)(1), was the correct standard. Because the parties stipulated that the 75% threshold had been met, MAP was not in violation of the statute.
• Outcome: Petition #19 was dismissed.
Ruling on Petition #34 (MacLeod’s Violations)
• Conclusion on Full-Time Occupancy: MacLeod was in violation of the Amendment by living full-time in the Tract G Hangar/Home.
• Rationale: MacLeod acknowledged living there full-time. His testimony regarding when he ceased this practice was found to be “widely inconsistent,” and the ALJ could not conclude that the violation had stopped by the time MAP filed its petition.
• Outcome: This allegation in Petition #34 was affirmed.
• Conclusion on Living Space Requirement: MAP failed to prove its allegation that the living space was less than the required 1,200 square feet.
• Rationale: MAP did not clearly document or otherwise prove its claim that the living space was only 549 square feet. MacLeod, in contrast, cited a 2007 architectural committee sign-off indicating 1,656 square feet.
• Outcome: This allegation in Petition #34 was dismissed.
• Conclusion on Injunctive Relief: The Tribunal lacked the authority to grant the requested relief.
• Rationale: MAP “cited no statutory authority of this Tribunal with regard to ‘enforcement’ of a homeowner’s association governing documents or with regard to any injunctive relief.”
Final Order
1. Prevailing Party: Mogollon Airpark, Inc. (MAP) is deemed the prevailing party in the cross-petitions.
2. Petition #19 (MacLeod v. MAP): Dismissed.
3. Petition #34 (MAP v. MacLeod):
◦ Partially affirmed as to the allegation of MacLeod living full-time in the Tract G Hangar/Home in violation of the Amendment.
◦ Partially dismissed as to the allegation regarding the amount of living space within the hangar.
4. Filing Fees: Each party shall bear their own filing fee.
Study Guide – 20F-H2019019-REL
Study Guide: MacLeod v. Mogollon Airpark, Inc.
Short-Answer Quiz
1. What were the two primary allegations made by Mogollon Airpark, Inc. (MAP) in its petition (Petition #34) against Magnus L.D. MacLeod?
2. What was the core argument presented by Magnus L.D. MacLeod in his petition (Petition #19) regarding the October 18, 2018 Amendment?
3. According to the original Declaration, what was the minimum approval threshold required to amend it?
4. How did the Amendment of October 18, 2018 change the rules regarding residency in Hangar Tracts like Tract G?
5. What was the central legal question that the parties stipulated to regarding the adoption of the Amendment?
6. Describe the two notices that MAP issued to MacLeod prior to filing its petition.
7. What argument did MacLeod make regarding A.R.S. § 33-1817(A)(2) and why he believed the Amendment required unanimous approval?
8. Why was MAP’s allegation regarding the living space in MacLeod’s Tract G hangar (that it was only 549 sq. ft.) dismissed by the Administrative Law Judge?
9. What was MacLeod’s testimony regarding his occupancy of the Tract G hangar, and how did the Administrative Law Judge view this testimony?
10. What was the final order of the Administrative Law Judge regarding Petition #19 and Petition #34, and which party was deemed the prevailing party?
Answer Key
1. In Petition #34, MAP first alleged that MacLeod was in continued violation of the Amendment by living full-time in his Tract G aircraft storage hangar. Second, MAP requested enforcement of the Declaration and Amendment, seeking injunctive relief and an award of its attorney’s fees and costs.
2. MacLeod’s petition alleged that the Amendment was unenforceable because it was not properly adopted pursuant to A.R.S. § 33-1817. He argued it did not receive the affirmative vote or written consent of all owners of the property to which the amendment applied, specifically noting that owners of three of the nine affected tracts (G, H, and M) did not consent.
3. The original Declaration stipulated that it could be amended by “an instrument in writing, executed and acknowledged by the owners of not less than three-fourths of the lots in said subdivision.” This represents a 75% approval threshold.
4. The Amendment established that guest quarters in aircraft storage hangars (Tracts E through M) were for “temporary living only,” which was defined as “not longer than four months per calendar year.” It also specified that such quarters could not be used as a permanent residence.
5. The parties stipulated that the central dispute was whether the Amendment required 75% approval from lot owners as specified in the Declaration, or if it required unanimous approval from all affected property owners pursuant to A.R.S. § 33-1817(A)(2).
6. On December 29, 2018, MAP issued a “First Notice of Non-Compliance” with a $100 fine for living full-time in the hangar. On April 29, 2019, MAP issued a “Second Notice: Non-Compliance,” imposing an additional $200 fine if the violation was not remedied.
7. MacLeod argued that pursuant to A.R.S. § 33-1817(A)(2), unanimous approval was required because the Amendment applied to fewer than all the lots bound by the Declaration. He specifically pointed out that Tract B, a common area, was not included in the Amendment.
8. The Administrative Law Judge dismissed this part of MAP’s petition because MAP failed to clearly document or prove its allegation. The judge concluded that MAP did not sufficiently demonstrate that the living space within the Tract G Hangar/Home was less than the required 1,200 square feet.
9. MacLeod gave widely inconsistent dates for his full-time occupancy of the hangar and testified that he had moved to Concho in January 2019. The Administrative Law Judge found his testimony inconsistent and could not conclude that MacLeod had stopped living in the hangar at the time Petition #34 was filed.
10. The judge ordered that MacLeod’s Petition #19 be dismissed entirely. The judge partially dismissed MAP’s Petition #34 regarding the living space allegation but affirmed the allegation that MacLeod was living in the hangar in violation of the Amendment. MAP was deemed the prevailing party in the cross-petitions.
Essay Questions
1. Analyze the conflicting interpretations of A.R.S. § 33-1817 presented by Magnus L.D. MacLeod and Mogollon Airpark, Inc. Explain why the Administrative Law Judge ultimately sided with MAP’s interpretation that A.R.S. § 33-1817(A)(1) was the applicable statute.
2. Trace the timeline of the dispute, starting with MacLeod’s purchase of Tract G and his proposal for a group home. Discuss how the actions and reactions of both parties escalated the conflict, leading to the filing of cross-petitions with the Department of Real Estate.
3. Evaluate the evidence presented by both parties. How did the parties’ joint stipulation of facts narrow the central legal issue? Discuss the impact of MacLeod’s inconsistent testimony on the judge’s final decision regarding his residency.
4. MacLeod argued that MAP had waived its right to enforce the Amendment due to “longstanding and widespread utilization of Tract Hanger/Homes as full-time residences.” Although the Judge did not address this argument due to jurisdictional limits, construct an argument for or against this claim based on the facts available in the decision.
5. Discuss the scope and limitations of the Administrative Law Judge’s authority in this case. Why was the Judge able to rule on the validity of the Amendment’s adoption and MacLeod’s violation, but not grant MAP’s request for injunctive relief and enforcement?
Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
The judicial authority, Kay Abramsohn, who presided over the hearing and issued the decision in this case.
A.R.S. § 33-1817
Arizona Revised Statute governing the amendment of a planned community’s Declaration. Subsection (A)(1) allows amendment by the vote specified in the Declaration, while (A)(2) requires unanimous consent of affected owners if the amendment applies to fewer than all lots.
Amendment
The “Amendment to Declaration of Establishment of Conditions, Reservations and Restrictions…” recorded on October 18, 2018. It created categories for Residential and Hangar lots and restricted hangar occupancy to temporary living of no more than four months per year.
A colloquial acronym used by the Petitioner to refer to the original “Declaration of Establishment of Conditions, Reservations and Restrictions and Mutual and Reciprocal Covenants and Liens Running with the Land.”
Declaration
The original governing document for Mogollon Airpark, Inc., establishing conditions, reservations, and restrictions for the properties. It required a three-fourths (75%) vote of lot owners to be amended.
Hangar Tracts
Tracts E through M, inclusive, as designated by the Amendment for the primary purpose of aircraft storage, though guest quarters for temporary living are permitted.
Magnus L.D. MacLeod
The Petitioner in Petition #19 and Respondent in Petition #34. He is the owner of Tract G and resided in the hangar on that property.
Mogollon Airpark, Inc. (MAP)
The Respondent in Petition #19 and Petitioner in Petition #34. It is the planned community association responsible for administering the Declaration.
Petition #19
The petition filed by Magnus L.D. MacLeod on October 15, 2019, alleging MAP improperly adopted the Amendment in violation of Arizona statute.
Petition #34
The petition filed by Mogollon Airpark, Inc. on December 16, 2019, alleging MacLeod was violating the Amendment by living full-time in his hangar.
Preponderance of the evidence
The standard of proof required in the hearing, defined as evidence that is sufficient to “incline a fair and impartial mind to one side of the issue rather than the other.”
Residential Lots
Lots numbered 178 through 213, inclusive, as categorized by the Amendment.
Tract G
An aircraft storage hangar lot in Unit 4B owned by Magnus L.D. MacLeod, which was the central property in the dispute.
Unit 4B
The specific subdivision within Mogollon Airpark subject to the Declaration and Amendment. It includes Lots 178-213 and Tracts B, E, F, G, H, I, J, K, L, and M.
Blog Post – 20F-H2019019-REL
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20F-H2019019-REL
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This administrative law judge decision concerns cross-petitions filed by Magnus L.D. MacLeod and Mogollon Airpark, Inc. (MAP) regarding disputes within a planned community association in Arizona. MacLeod’s petition challenged the validity of an amendment to the community’s governing documents (CC&Rs), arguing it was improperly adopted and unreasonably altered prior usage rights for hangar/homes, specifically his Tract G property. MAP’s petition alleged that MacLeod was in continued violation of the amendment by living full-time in his aircraft storage hangar and requested injunctive relief to compel compliance. The judge ruled to dismiss MacLeod’s petition, finding the amendment was properly adopted, and partially affirmed MAP’s petition, concluding that MacLeod had violated the amendment by residing full-time in the hangar. Ultimately, MAP was deemed the prevailing party in the proceedings.
What were the central legal issues and findings in this property dispute case?
How did the contested amendment change the community’s declaration and rules?
What were the core arguments and outcomes for each party involved in this hearing?
Based on 1 source
Case Participants
Petitioner Side
Jeffrey M. Proper(attorney) JEFFREY M. PROPER, PLLC Counsel for Magnus L.D. MacLeod
Respondent Side
Gregory A. Stein(attorney) Carpenter, Hazlewood, Delgado & Bolen LLP Counsel for Mogollon Airpark, Inc.
Craig Albright(board member) MAP Board of Directors Then President of the MAP Board of Directors
Neutral Parties
Kay Abramsohn(ALJ)
Judy Lowe(commissioner) Arizona Department of Real Estate
Other Participants
Magnus L.D. MacLeod(party) Petitioner in 20F-H2019019-REL and Respondent in 20F-H2019034-REL
Pat MacLeod(HOA president) HOA Brother of Petitioner; previous owner of Tract G; appeared to be HOA President around 2017
The ALJ dismissed the Petitioners' complaint, ruling that the HOA acted reasonably and within its authority under the CC&Rs and A.R.S. § 33-1255(C) by requiring homeowners to remove their limited common element patio covers for necessary maintenance and requiring the homeowners to bear the associated cost.
Why this result: Petitioners failed to demonstrate that the Respondent HOA committed a violation of the condominium documents or statutes.
Key Issues & Findings
Authority of HOA to require removal of a limited common element (patio cover) for maintenance and allocation of associated costs.
Petitioners alleged the HOA violated CC&Rs by mandating the removal of their patio cover at their expense to facilitate building painting. The ALJ found the HOA's proposed plan was reasonable and authorized by CC&R Sections 9 and 9(b), and that Petitioners, under A.R.S. § 33-1255(C), must bear the cost of removing and reinstalling the limited common element.
Orders: Petitioners' petition is dismissed. Respondent Tempe Gardens Townhouse Corporation is deemed to be the prevailing party. Petitioners are responsible for the cost to remove and reinstall their patio cover.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R Section 9
CC&R Section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA Authority, Limited Common Element, Maintenance Costs, CC&R Interpretation, Patio Cover Removal
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 33-1255(C)
A.R.S. § 33-1212(4)
A.R.S. § 33-1806(E)
Gutierrez v. Industrial Commission of Arizona
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Audio Overview
Decision Documents
17F-H1717038-REL-RHG Decision – 605540.pdf
Uploaded 2025-10-08T06:58:20 (105.0 KB)
Briefing Doc – 17F-H1717038-REL-RHG
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
The ALJ dismissed the Petitioners' complaint, ruling that the HOA acted reasonably and within its authority under the CC&Rs and A.R.S. § 33-1255(C) by requiring homeowners to remove their limited common element patio covers for necessary maintenance and requiring the homeowners to bear the associated cost.
Why this result: Petitioners failed to demonstrate that the Respondent HOA committed a violation of the condominium documents or statutes.
Key Issues & Findings
Authority of HOA to require removal of a limited common element (patio cover) for maintenance and allocation of associated costs.
Petitioners alleged the HOA violated CC&Rs by mandating the removal of their patio cover at their expense to facilitate building painting. The ALJ found the HOA's proposed plan was reasonable and authorized by CC&R Sections 9 and 9(b), and that Petitioners, under A.R.S. § 33-1255(C), must bear the cost of removing and reinstalling the limited common element.
Orders: Petitioners' petition is dismissed. Respondent Tempe Gardens Townhouse Corporation is deemed to be the prevailing party. Petitioners are responsible for the cost to remove and reinstall their patio cover.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R Section 9
CC&R Section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA Authority, Limited Common Element, Maintenance Costs, CC&R Interpretation, Patio Cover Removal
Additional Citations:
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 33-1255(C)
A.R.S. § 33-1212(4)
A.R.S. § 33-1806(E)
Gutierrez v. Industrial Commission of Arizona
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Audio Overview
Decision Documents
17F-H1717038-REL-RHG Decision – 605540.pdf
Uploaded 2025-10-08T07:02:35 (105.0 KB)
Briefing Doc – 17F-H1717038-REL-RHG
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.
Case Summary
Case ID
17F-H1717038-REL-RHG
Agency
ADRE
Tribunal
OAH
Decision Date
2017-12-11
Administrative Law Judge
Thomas Shedden
Outcome
loss
Filing Fees Refunded
$0.00
Civil Penalties
$0.00
Parties & Counsel
Petitioner
James and Shawna Larson
Counsel
Lisa M. Hanger
Respondent
Tempe Gardens Townhouse Corporation
Counsel
Nathan Tennyson
Alleged Violations
A.R.S. § 33-1255(C); CC&R sections 9 and 9(b)
Outcome Summary
The ALJ dismissed the petition, ruling that the HOA acted reasonably and had the authority under the CC&Rs to require the removal of the homeowner's patio cover for necessary painting and repairs. The ALJ determined that because the patio cover is a limited common element, the Petitioners must bear the cost of removal and reinstallation according to A.R.S. § 33-1255(C).
Why this result: Petitioners failed to prove the HOA violated CC&Rs or acted unreasonably, and statutory law assigned the expense burden for the limited common element to the homeowner.
Key Issues & Findings
Authority of HOA to mandate removal of homeowner's patio cover for maintenance and assignment of removal/reinstallation costs.
Petitioners challenged the Respondent HOA's authority and reasonableness in requiring them to remove their patio cover, a limited common element, for building painting and repair, and disputed the requirement that Petitioners bear the costs. The ALJ concluded that the HOA's plan was reasonable, the HOA had the authority under CC&R sections 9 and 9(b), and Petitioners must bear the cost of removal and reinstallation under A.R.S. § 33-1255(C).
Orders: Petitioners’ petition is dismissed. Respondent is deemed the prevailing party. Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA authority, limited common element, maintenance costs, patio cover, CC&Rs, statutory interpretation, dismissal, prevailing party
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing document synthesizes the legal dispute between homeowners James and Shawna Larson (Petitioners) and the Tempe Gardens Townhouse Corporation (Respondent). The core conflict centered on the Respondent’s requirement that Petitioners remove their patio cover at their own expense to facilitate a community-wide building repair and painting project. The case initially faced a jurisdictional challenge, with an Administrative Law Judge (ALJ) recommending dismissal due to the speculative nature of the Respondent’s threat to remove the cover. This recommendation was rejected by the Commissioner of the Department of Real Estate, who found the matter ripe for adjudication and ordered a new hearing.
The final Administrative Law Judge Decision ultimately ruled in favor of the Respondent. The decision found the HOA’s plan to remove the patio covers was reasonable, necessary for the safe and proper completion of the project, and authorized under the community’s CC&Rs. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona statute. Consequently, the financial responsibility for its removal and potential reinstallation rests solely with the Petitioners as the homeowners to whom the element is assigned. The Petitioners’ petition was dismissed, and the Respondent was deemed the prevailing party.
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Procedural History
The case progressed through several distinct legal phases, beginning with a petition and culminating in a final administrative decision after a rehearing.
Outcome/Significance
June 15-16, 2017
Petition Filed
James and Shawna Larson filed a petition with the Department of Real Estate alleging a violation of the Respondent’s CC&Rs.
August 25, 2017
Order Recommending Dismissal
Administrative Law Judge Suzanne Marwil recommended dismissing the petition, finding no “justiciable controversy” because the Respondent had not yet acted on its threat to remove the patio cover, rendering the issue speculative.
August 31, 2017
Order Rejecting Recommendation
Judy Lowe, Commissioner of the Department of Real Estate, rejected the ALJ’s recommendation. Citing a June 1, 2017 letter from the Respondent, the Commissioner determined the matter was “ripe for adjudication” and ordered the hearing to be rescheduled.
September 1, 2017
Notice of Re-Hearing Issued
The Arizona Department of Real Estate formally scheduled a new hearing in the matter.
November 20, 2017
Rehearing Conducted
A full hearing on the merits was conducted before Administrative Law Judge Thomas Shedden.
December 11, 2017
Final Administrative Law Judge Decision
ALJ Thomas Shedden issued a final decision, dismissing the Petitioners’ petition and finding in favor of the Respondent.
Core Dispute Analysis
The conflict arose from a maintenance project initiated by the Tempe Gardens Townhouse Corporation, which consists of 169 units. The project involved repairing and painting the exteriors of the community’s twenty-five two-story buildings.
Respondent’s (HOA’s) Mandate and Rationale
• Project Requirement: The HOA informed homeowners with patio covers that they were required to remove the covers at their own expense before repairs and painting could begin.
• Enforcement Threat: In a letter dated June 1, 2017, the HOA stated that if the Larsons’ patio cover was not removed within ten days, the HOA would remove it under the authority of CC&R section 10(a) and charge the homeowners for the cost.
• Legal Justification: The HOA asserted its authority based on:
◦ CC&R Section 9(b): Grants the Respondent responsibility for maintaining the building exteriors.
◦ CC&R Section 9: States, “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the … [building] exteriors … shall be taken by the [Respondent].”
• Practical Necessity: The HOA argued that removal was essential for the project’s proper and safe completion, a position supported by its project manager.
Petitioners’ (Larsons’) Objections and Counter-Arguments
• Initial Legal Position: In their brief, the Petitioners stated that “the true issues underlying this issue are not about whether Respondent’s current threatened actions are a violation of the CC&Rs. The true issues relate to Respondent Association’s actions and inactions that have lead up to the point where the Parties now find themselves addressing this administrative law panel.”
• Lack of Authority: In a May 19, 2017 letter, the Larsons’ counsel argued the HOA had no legal authority to support its request.
• Unreasonable Cost: The Petitioners asserted that the cost of removal and reinstallation would be “thousands of dollars” and provided bids ranging from $3,980 to $5,975.
• Historical Precedent: The patio cover was in place when the Larsons purchased their unit in 1999, and they argued the HOA did not disclose any violation at that time.
• Proposed Alternatives:
1. The Larsons offered to have the back of their unit painted at their own expense, which the HOA rejected over concerns about project warranty and management.
2. During the November 20 hearing, after hearing testimony, the Larsons offered not to reinstall their patio cover if the Respondent would pay for its removal.
Key Evidence and Testimony
The final decision heavily relied on the testimony of Wayne King, the project manager hired by the HOA, and an analysis of competing cost estimates.
Testimony of Wayne King (Project Manager)
• Project Scope: King testified that the project involved not only painting but also repairing damaged siding, much of which was caused by improperly flashed patio covers. To “do the job right,” the process required sanding, power washing, and patching before painting.
• Contractor Requirements: All five contractors who bid on the project required the patio covers to be removed.
• Safety and Logistics: King explained why working around the covers was not viable:
◦ Scaffolding: “Regular” scaffolding would not fit, and commercial scaffolding would not provide access to the entire building.
◦ Lifts: Using a “reach” or forklift was not an option due to overhead powerlines creating a safety hazard.
◦ Worker Safety: Allowing painters to walk on homeowners’ patio covers was not a safe option. He noted that changes in safety laws since the buildings were last painted necessitated different methods.
• Warranty: King testified that the paint company would not provide a warranty for the project if individual homeowners, like the Larsons, painted their own units.
Cost Estimates and Discrepancies
• Petitioners’ Estimates: The Larsons submitted two bids for their wooden patio cover:
◦ Bid 1: $1,250 to remove and dispose; $3,980 to remove and rebuild with new wood.
◦ Bid 2: $5,975 to remove and replace the structure.
• Respondent’s Estimates:
◦ The HOA’s initial letter offered a contractor who would remove aluminum covers for $150. The cost for the Larsons’ wood cover was stated as $225, though this was not a firm price.
◦ Wayne King testified that the Petitioners’ estimates were “very high” and opined that $1,000 should cover the cost of removing and rebuilding, assuming existing materials were reused. He acknowledged decking material would likely need replacement but estimated 80% of rafters could be reused.
Legal Findings and Final Decision
The Administrative Law Judge Decision of December 11, 2017, provided a comprehensive legal analysis that concluded in the Respondent’s favor.
Governing Authority and Reasonableness
• Deference to the HOA: Citing Tierra Ranchos Homeowners Ass’n v. Kitchukov, the decision established that the tribunal must accord the HOA deference in its decisions regarding maintenance and repair, provided it acts reasonably.
• Finding of Reasonableness: Based on the credible testimony of Wayne King, the judge found that the Respondent’s proposed plan for repairing and painting was reasonable, as the buildings could not be “properly and safely painted without the patio covers being removed.”
• Authorization under CC&Rs: The judge concluded that CC&R sections 9 and 9(b) were “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
“Limited Common Element” Doctrine and Cost Allocation
The central legal issue of financial responsibility was resolved by applying Arizona state statutes.
1. Classification: The Petitioners’ patio cover was classified as a limited common element within the meaning of ARIZ. REV. STAT. section 33-1212(4).
2. Statutory Rule: The judge then applied ARIZ. REV. STAT. section 33-1255(C), which states:
3. Conclusion on Cost: Based on a “reasonable reading” of this statute, the decision concluded that the Petitioners must bear the cost of removing the patio cover and, should they choose to do so, the cost of reinstalling it.
Final Ruling
• The evidence supported the conclusion that the Respondent had the authority to require the removal of the patio cover at the Petitioners’ expense.
• IT IS ORDERED that the petition filed by James and Shawna Larson is dismissed.
• The Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
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Key Parties and Representatives
Name(s)
Representation
Petitioners
James and Shawna Larson
Lisa M. Hanger, Esq.
Respondent
Tempe Gardens Townhouse Corporation
Nathan Tennyson, Esq. (Brown Alcott PLLC)
ALJ (Initial)
Suzanne Marwil
Office of Administrative Hearings
ALJ (Final)
Thomas Shedden
Office of Administrative Hearings
Commissioner
Judy Lowe
Arizona Department of Real Estate
Study Guide – 17F-H1717038-REL-RHG
Study Guide for Larson v. Tempe Gardens Townhouse Corporation
This study guide provides a comprehensive review of the administrative case between James and Shawna Larson and the Tempe Gardens Townhouse Corporation, culminating in the Administrative Law Judge Decision of December 11, 2017. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms to facilitate a thorough understanding of the case’s facts, legal arguments, and procedural history.
Short-Answer Quiz
Instructions: Answer the following ten questions based on the provided source documents. Each answer should be two to three sentences long.
1. Who were the primary parties in this case, and what was their relationship?
2. What was the initial reason given by Administrative Law Judge (ALJ) Suzanne Marwil for recommending the dismissal of the Larsons’ petition?
3. Why did Commissioner of the Department of Real Estate Judy Lowe reject the initial recommendation for dismissal?
4. What was the central issue adjudicated at the November 20, 2017 hearing before ALJ Thomas Shedden?
5. According to the Respondent, Tempe Gardens Townhouse Corporation, which specific sections of the CC&Rs granted it the authority to require the removal of patio covers?
6. Who was Wayne King, and what was the substance of his testimony during the hearing?
7. How did the Arizona Revised Statutes (A.R.S.) classify the Petitioners’ patio cover, and why was this classification legally significant for the case’s outcome?
8. What safety and logistical reasons were provided to justify the necessity of removing the patio covers for the painting project?
9. What was the final decision issued by ALJ Thomas Shedden on December 11, 2017?
10. According to the final ruling, who is financially responsible for the removal and potential reinstallation of the Petitioners’ patio cover, and what was the legal basis for this conclusion?
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Answer Key
1. The primary parties were the Petitioners, homeowners James and Shawna Larson, and the Respondent, their homeowner’s association, Tempe Gardens Townhouse Corporation. The dispute arose from the Respondent’s requirement that the Petitioners remove a patio cover at their unit.
2. ALJ Suzanne Marwil recommended dismissal on August 25, 2017, for a lack of a “justiciable controversy.” She reasoned that the Respondent’s threat to take down the patio cover had not yet been undertaken, making the issue speculative and more appropriate for a declaratory judgment action in superior court.
3. Commissioner Judy Lowe rejected the recommendation on August 31, 2017, stating the matter was “ripe for adjudication.” Her decision was based on a letter from June 1, 2017, in which the Respondent alleged a violation of the governing documents, thus creating a tangible controversy for the administrative tribunal to rule upon.
4. The central issue was whether the Respondent had the authority to mandate the removal of the Petitioners’ patio cover to facilitate a large-scale building repair and painting project. A secondary issue was determining who was financially responsible for the cost of removal and reinstallation.
5. The Respondent cited CC&R sections 9 and 9(b) as the source of its authority. Section 9(b) makes the Respondent responsible for maintaining building exteriors, and section 9 grants it the power to take “any cooperative action necessary or appropriate” for that maintenance.
6. Wayne King was the project manager hired by the Respondent for the painting project. He provided expert testimony that removing the patio covers was necessary to properly and safely repair and paint the buildings, noting that all five bidding contractors required their removal and that alternative methods were not viable or safe.
7. The patio cover was classified as a “limited common element” under A.R.S. § 33-1212(4). This was significant because A.R.S. § 33-1255(C) states that common expenses associated with the maintenance or repair of a limited common element shall be assessed against the units to which it is assigned, placing the financial burden on the Petitioners.
8. Project manager Wayne King testified that removal was necessary to accommodate the 14-foot by 8-foot area required for scaffolding. He explained that using a forklift was unsafe due to overhead powerlines, and allowing painters to walk on the covers was also a safety hazard, especially given changes in safety laws since the last painting project.
9. ALJ Thomas Shedden dismissed the Petitioners’ petition and deemed the Respondent, Tempe Gardens Townhouse Corporation, to be the prevailing party. The order found that the Respondent’s plan was reasonable and that it had the authority to require the patio cover’s removal.
10. The final ruling concluded that the Petitioners, James and Shawna Larson, were responsible for the cost to remove the patio cover and the cost to reinstall it if they chose to do so. The legal basis was A.R.S. § 33-1255(C), which assigns expenses related to a “limited common element” (the patio cover) exclusively to the unit owner it benefits.
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Essay Questions
Instructions: The following questions are designed to test a deeper, more analytical understanding of the case. Formulate a comprehensive response for each, drawing evidence from the provided source documents.
1. Trace the procedural history of case No. 17F-H1717038-REL from the initial petition to the final decision. Explain the reasoning behind each major procedural step, including the initial recommendation for dismissal, its rejection by the Commissioner, and the final order.
2. Analyze the legal arguments presented by both the Petitioners (James and Shawna Larson) and the Respondent (Tempe Gardens Townhouse Corporation) at the November 20, 2017 hearing. Discuss the key pieces of evidence, including witness testimony, cost estimates, and CC&R provisions, that each side used to support its position.
3. Explain the concept of “justiciable controversy” as it was applied by ALJ Suzanne Marwil in her recommendation for dismissal. Contrast her interpretation with Commissioner Judy Lowe’s reasoning for why the matter was “ripe for adjudication.”
4. Discuss the legal significance of classifying the patio cover as a “limited common element.” How did this classification, in conjunction with Arizona Revised Statutes and the community’s CC&Rs, ultimately determine the outcome of the case regarding financial responsibility?
5. Evaluate the role of expert testimony in the final administrative hearing. How did the testimony of Wayne King influence ALJ Thomas Shedden’s findings of fact and conclusions of law regarding the reasonableness and necessity of the Respondent’s actions?
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Glossary of Key Terms
Definition
Administrative Law Judge (ALJ)
The judge who presides over administrative hearings at a government agency, such as the Office of Administrative Hearings. In this case, Suzanne Marwil and Thomas Shedden served as ALJs.
A.R.S. (Arizona Revised Statutes)
The official compilation of the laws of the state of Arizona. Key statutes cited include A.R.S. § 32-2199, § 33-1212(4), and § 33-1255(C).
CC&Rs (Covenants, Conditions & Restrictions)
The governing documents for a planned community or condominium association that outline the rights and obligations of the homeowners and the association. In this case, sections 9, 9(b), and 10(a) were specifically mentioned.
Declaratory Judgment Action
A legal action filed in superior court where a party asks the court to provide a binding ruling on the rights and obligations of the parties before an actual injury has occurred.
Justiciable Controversy
A real, substantial legal dispute that is appropriate for a court or tribunal to resolve. It cannot be a hypothetical, speculative, or advisory matter.
Limited Common Element
As defined in A.R.S. § 33-1212(4), a common element of a condominium assigned for the exclusive use of one or more units, but fewer than all of them. The Larsons’ patio cover was classified as such.
Petition
The formal written request filed by a party to initiate a case with an administrative body. The Larsons filed their petition with the Department of Real Estate on June 15/16, 2017.
Petitioner
The party who initiates a legal action by filing a petition. In this case, James and Shawna Larson were the Petitioners.
Preponderance of the Evidence
The standard of proof required in this administrative hearing. It means the greater weight of the evidence is sufficient to incline a fair and impartial mind to one side of an issue over the other.
Respondent
The party against whom a petition is filed. In this case, Tempe Gardens Townhouse Corporation was the Respondent.
Tribunal
A body, such as the Office of Administrative Hearings, with the authority to judge, adjudicate on, or determine claims or disputes.
Blog Post – 17F-H1717038-REL-RHG
They Fought the HOA Over a Patio and Lost: 3 Shocking Legal Lessons for Every HOA Member
It’s the letter every homeowner dreads. An official-looking envelope from the Homeowner’s Association (HOA) lands in your mailbox, and the message inside is not a friendly neighborhood greeting. It’s a demand.
This is exactly what happened to Arizona couple James and Shawna Larson. Their HOA, Tempe Gardens Townhouse Corporation, was planning a large-scale project to repair and paint the building exteriors. To do the job properly, the HOA demanded that the Larsons remove their wooden patio cover—at their own expense. The Larsons, believing this was an unreasonable overreach, refused. That refusal kicked off a legal battle that serves as a masterclass in the often-shocking realities of HOA power.
This post distills the most important lessons from their fight. These are the legal realities that every homeowner should understand before they find themselves on the receiving end of a similar notice.
You Can Win the First Round and Still Lose the Case
In the first stage of the dispute, the Administrative Law Judge actually recommended that the Larsons’ petition be dismissed. The judge’s reasoning was based on a crucial legal doctrine: ripeness. Because the HOA had only threatened to remove the patio cover and hadn’t physically done it yet, the judge found the issue “speculative.” In the court’s view, there was no “justiciable controversy” to rule on yet.
The initial ruling contained a powerful statement highlighting the confusion:
Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.
But this initial victory was short-lived. In a surprising twist, the Commissioner of the Department of Real Estate rejected the judge’s recommendation. The Commissioner found that the core question—whether the patio cover violated the association’s rules—was “ripe for adjudication” and ordered the case back to court for a full hearing. This highlights a key principle: administrative bodies often prefer to rule on the substance of a dispute rather than dismiss it on procedural grounds, ensuring that core community conflicts are actually resolved.
A case isn’t over until it’s over. An initial procedural win (or loss) can be overturned, shifting the entire battlefield. With the case now officially back on, the court turned to the central question of the dispute: who was financially responsible for the patio cover?
It’s Your Patio, So It’s Your Bill—Even When the HOA Forces the Work
The central conflict boiled down to one question: who should pay? The Larsons believed that since the HOA required the patio cover to be removed for its maintenance project, the HOA should bear the associated costs. This seems like common sense, but HOA law operates on a different logic.
The case was decided by a key legal concept: the patio cover was legally classified as a “limited common element.” For most homeowners, this is where their jaw hits the floor. A limited common element is part of the common area (like exterior walls or roofs) but is assigned for the exclusive use of a single unit owner. The logic behind this law is that while the HOA maintains general common areas, elements that provide an exclusive benefit to one owner—like their personal patio, balcony, or assigned parking spot—carry an exclusive financial responsibility, even for HOA-mandated work.
This classification has a devastating financial consequence spelled out in Arizona statute A.R.S. § 33-1255(C). The law states that common expenses associated with a limited common element are assessed against the unit it’s assigned to. The judge’s final conclusion was direct and absolute:
Because the patio cover is a limited common element, under a reasonable reading of ARIZ. REV. STAT. section 33-1255(C), Petitioners must bear the cost of removing the patio cover and, if they choose to do so, the cost of reinstalling it.
Under the law, because the patio exclusively benefitted the Larsons, they were solely responsible for all costs associated with it, even when the work was demanded by the HOA for its own project.
Deference is Given to a Well-Prepared HOA
The HOA didn’t win just because of a legal statute; it won because it built a sound, well-documented case for its demand. They didn’t just issue an order; they presented extensive evidence that their plan was “reasonable.”
The testimony of their project manager, Wayne King, was particularly compelling. He laid out a series of facts that were difficult to dispute:
• The project involved necessary repairs to siding and flashing, not just cosmetic painting.
• All five painting contractors who bid on the project required the patio covers to be removed.
• Removal was essential to comply with modern safety laws for scaffolding and to allow for proper work, including sanding and power washing.
• Safety laws had changed since the buildings were last painted, making old methods unsafe and illegal.
• Allowing individual homeowners to paint their own sections would void the painter’s warranty for the entire project.
Faced with this mountain of meticulously documented evidence, the judge ruled that the HOA’s plan was “reasonable.” Because of this, the court was legally bound to “accord Respondent deference in decisions regarding maintenance and repair of the common areas.” In other words, when an HOA acts logically, documents its process, and prioritizes safety and proper procedure, courts will give it significant authority to enforce its decisions.
Conclusion: Knowledge is Power in an HOA
The Larsons’ case is a stark reminder that in an HOA, what feels fair is irrelevant. The only things that matter are procedural correctness (even a ‘win’ can be temporary), the fine print of legal definitions (you can be forced to pay to remove your own property), and an HOA’s documented reasonableness (a well-prepared board is nearly unbeatable). These principles are found not in a sense of fairness, but in the specific, often surprising language of state law and a community’s own CC&Rs.
This case was about a patio cover, but the principles apply to fences, doors, and windows—do you truly know what you own and what you’re responsible for?
Case Participants
Petitioner Side
James Larson(petitioner)
Shawna Larson(petitioner)
Lisa M. Hanger(petitioner attorney)
Respondent Side
Nathan Tennyson(respondent attorney) Brown Alcott PLLC
Wayne King(witness) Project Manager for painting project hired by Respondent
Neutral Parties
Suzanne Marwil(ALJ) Issued initial Recommended Order of Dismissal (August 25, 2017)
Thomas Shedden(ALJ) Issued Administrative Law Judge Decision (December 11, 2017)
Judy Lowe(Commissioner) Arizona Department of Real Estate Rejected initial recommendation of dismissal
Dan Gardner(HOA Coordinator) Transmitted Commissioner's order
The ALJ dismissed the petition, ruling that the HOA acted reasonably and had the authority under the CC&Rs to require the removal of the homeowner's patio cover for necessary painting and repairs. The ALJ determined that because the patio cover is a limited common element, the Petitioners must bear the cost of removal and reinstallation according to A.R.S. § 33-1255(C).
Why this result: Petitioners failed to prove the HOA violated CC&Rs or acted unreasonably, and statutory law assigned the expense burden for the limited common element to the homeowner.
Key Issues & Findings
Authority of HOA to mandate removal of homeowner's patio cover for maintenance and assignment of removal/reinstallation costs.
Petitioners challenged the Respondent HOA's authority and reasonableness in requiring them to remove their patio cover, a limited common element, for building painting and repair, and disputed the requirement that Petitioners bear the costs. The ALJ concluded that the HOA's plan was reasonable, the HOA had the authority under CC&R sections 9 and 9(b), and Petitioners must bear the cost of removal and reinstallation under A.R.S. § 33-1255(C).
Orders: Petitioners’ petition is dismissed. Respondent is deemed the prevailing party. Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA authority, limited common element, maintenance costs, patio cover, CC&Rs, statutory interpretation, dismissal, prevailing party
Additional Citations:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 41-1092.09
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
Audio Overview
Decision Documents
17F-H1717038-REL Decision – 583987.pdf
Uploaded 2025-10-08T06:58:14 (53.0 KB)
17F-H1717038-REL Decision – 585505.pdf
Uploaded 2025-10-08T06:58:15 (385.9 KB)
Briefing Doc – 17F-H1717038-REL
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
The ALJ dismissed the petition, ruling that the HOA acted reasonably and had the authority under the CC&Rs to require the removal of the homeowner's patio cover for necessary painting and repairs. The ALJ determined that because the patio cover is a limited common element, the Petitioners must bear the cost of removal and reinstallation according to A.R.S. § 33-1255(C).
Why this result: Petitioners failed to prove the HOA violated CC&Rs or acted unreasonably, and statutory law assigned the expense burden for the limited common element to the homeowner.
Key Issues & Findings
Authority of HOA to mandate removal of homeowner's patio cover for maintenance and assignment of removal/reinstallation costs.
Petitioners challenged the Respondent HOA's authority and reasonableness in requiring them to remove their patio cover, a limited common element, for building painting and repair, and disputed the requirement that Petitioners bear the costs. The ALJ concluded that the HOA's plan was reasonable, the HOA had the authority under CC&R sections 9 and 9(b), and Petitioners must bear the cost of removal and reinstallation under A.R.S. § 33-1255(C).
Orders: Petitioners’ petition is dismissed. Respondent is deemed the prevailing party. Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA authority, limited common element, maintenance costs, patio cover, CC&Rs, statutory interpretation, dismissal, prevailing party
Additional Citations:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 41-1092.09
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
Audio Overview
Decision Documents
17F-H1717038-REL Decision – 583987.pdf
Uploaded 2025-10-08T07:02:29 (53.0 KB)
17F-H1717038-REL Decision – 585505.pdf
Uploaded 2025-10-08T07:02:30 (385.9 KB)
Briefing Doc – 17F-H1717038-REL
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
The ALJ dismissed the petition, ruling that the HOA acted reasonably and had the authority under the CC&Rs to require the removal of the homeowner's patio cover for necessary painting and repairs. The ALJ determined that because the patio cover is a limited common element, the Petitioners must bear the cost of removal and reinstallation according to A.R.S. § 33-1255(C).
Why this result: Petitioners failed to prove the HOA violated CC&Rs or acted unreasonably, and statutory law assigned the expense burden for the limited common element to the homeowner.
Key Issues & Findings
Authority of HOA to mandate removal of homeowner's patio cover for maintenance and assignment of removal/reinstallation costs.
Petitioners challenged the Respondent HOA's authority and reasonableness in requiring them to remove their patio cover, a limited common element, for building painting and repair, and disputed the requirement that Petitioners bear the costs. The ALJ concluded that the HOA's plan was reasonable, the HOA had the authority under CC&R sections 9 and 9(b), and Petitioners must bear the cost of removal and reinstallation under A.R.S. § 33-1255(C).
Orders: Petitioners’ petition is dismissed. Respondent is deemed the prevailing party. Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA authority, limited common element, maintenance costs, patio cover, CC&Rs, statutory interpretation, dismissal, prevailing party
Additional Citations:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 41-1092.09
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
Video Overview
Audio Overview
Decision Documents
17F-H1717038-REL Decision – 583987.pdf
Uploaded 2025-10-09T03:31:46 (53.0 KB)
17F-H1717038-REL Decision – 585505.pdf
Uploaded 2025-10-09T03:31:46 (385.9 KB)
Briefing Doc – 17F-H1717038-REL
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
Study Guide – 17F-H1717038-REL
Study Guide: Larson v. Tempe Gardens Townhouse Corporation
This study guide provides a comprehensive review of the administrative case between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation. It includes a short-answer quiz, an answer key, suggested essay questions, and a glossary of key terms based on the provided legal documents.
——————————————————————————–
Short-Answer Quiz
Answer the following questions in 2-3 sentences each, based on the information in the provided source documents.
1. Who were the primary parties involved in this case, and what was their relationship?
2. What was the initial reason given by Administrative Law Judge (ALJ) Suzanne Marwil for recommending the dismissal of the Larsons’ petition?
3. Why did the Commissioner of the Department of Real Estate, Judy Lowe, reject the initial recommendation for dismissal?
4. What was the central dispute that was ultimately decided in the November 20, 2017, hearing?
5. According to the final Administrative Law Judge Decision, what is the legal classification of the petitioners’ patio cover?
6. Which specific sections of the CC&Rs did the Respondent, Tempe Gardens Townhouse Corporation, cite as the basis for its authority?
7. What key reasons did project manager Wayne King provide to justify the necessity of removing the patio covers for the painting project?
8. Describe the significant difference in the cost estimates for removing and replacing the patio cover as presented by the Petitioners versus the Respondent’s project manager.
9. What was the final ruling regarding who was financially responsible for the removal and potential reinstallation of the patio cover?
10. What was the ultimate outcome of the Larsons’ petition following the final hearing, and which party was deemed the “prevailing party”?
——————————————————————————–
Answer Key
1. The primary parties were the Petitioners, homeowners James and Shawna Larson, and the Respondent, the Tempe Gardens Townhouse Corporation, which is their homeowner’s association (HOA). The dispute arose from the HOA’s plan to repair and paint the building exteriors.
2. ALJ Marwil initially recommended dismissal due to a “lack of justiciable controversy.” She found that the Petitioners had failed to cite any provision of the CC&Rs that the Respondent had currently violated, as the threatened action to remove the patio cover was speculative and had not yet occurred.
3. Commissioner Lowe rejected the dismissal because she found the matter was “ripe for adjudication.” Her decision was based on a June 1, 2017 letter from the Respondent that questioned whether “the presence of the awning [is] a violation of the Association’s governing documents,” which she interpreted as the Respondent alleging a violation.
4. The central dispute was whether the Tempe Gardens Townhouse Corporation had the authority to mandate that homeowners, specifically the Larsons, remove their patio covers at their own expense to facilitate a building repair and painting project.
5. The final decision classifies the Petitioners’ patio cover as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4). This classification was crucial to determining financial responsibility.
6. The Respondent cited sections 9 and 9(b) of the CC&Rs. Section 9(b) makes the Respondent responsible for maintaining building exteriors, and section 9 grants it the authority to take “Any cooperative action necessary or appropriate to the proper maintenance and upkeep” of those exteriors.
7. Wayne King testified that removal was necessary to properly and safely complete the work using scaffolding, as required by modern safety laws. He also stated that removal was needed to repair improperly flashed areas behind the covers and to ensure the painting contractor would provide a warranty for the project.
8. The Petitioners presented bids showing the cost to remove and rebuild the cover would be between $3,980 and $5,975. In contrast, Mr. King opined these estimates were very high and that the cost should be closer to $1,000 if existing materials were reused.
9. The final ruling, based on ARIZ. REV. STAT. section 33-1255(C), was that the Petitioners must bear the cost of removing the patio cover and, if they choose, the cost of reinstalling it. This is because the patio cover is a limited common element assigned specifically to their unit.
10. The final outcome was the dismissal of the Larsons’ petition. The Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party in the matter.
——————————————————————————–
Essay Questions
The following questions are designed for a more in-depth analysis. Use the provided documents to construct a detailed, evidence-based response.
1. Trace the procedural history of this case from the initial filing to the final decision. Discuss the key turning points, including the initial recommendation for dismissal, its rejection by the Commissioner, and the reasoning behind the final judgment.
2. Analyze the legal arguments presented by both the Petitioners and the Respondent in the November 2017 hearing. On what specific statutes and CC&R provisions did each side rely, and how did the Administrative Law Judge ultimately interpret these documents?
3. Evaluate the role of expert testimony in this case, specifically focusing on the evidence provided by project manager Wayne King. How did his testimony regarding safety, project requirements, and cost estimates influence the Administrative Law Judge’s findings on the reasonableness of the Respondent’s actions?
4. Discuss the legal concept of a “limited common element” as defined and applied in the source documents. Explain how this classification was central to the final decision regarding financial responsibility for the patio cover’s removal and reinstallation.
5. The initial Administrative Law Judge found no “justiciable controversy,” while the Commissioner later found the matter “ripe for adjudication.” Based on the details in all three documents, explain the arguments for both positions and analyze why the case ultimately proceeded to a full hearing.
——————————————————————————–
Glossary of Key Terms
Definition from Source Context
Administrative Law Judge (ALJ)
An official in the Office of Administrative Hearings who adjudicates complaints regarding condominium and planned community documents and ensures compliance with relevant statutes.
Covenants, Conditions, and Restrictions. The documents that govern the community and are described as a contract between the homeowner’s association and the homeowners.
Justiciable Controversy
A real dispute that a tribunal has the authority to resolve. The initial petition was recommended for dismissal for a lack of a justiciable controversy because the Respondent’s threatened actions were deemed speculative.
Limited Common Element
A legal classification for property defined under ARIZ. REV. STAT. section 33-1212(4). In this case, the Petitioners’ patio cover was classified as such, meaning any common expense associated with its maintenance, repair, or replacement is assessed against the unit to which it is assigned.
Petition
The formal document filed with the Department of Real Estate to initiate a complaint against a homeowner’s association.
Petitioner
The party that files a petition initiating a legal action. In this case, the homeowners James and Shawna Larson.
Preponderance of the Evidence
The standard of proof required in this matter, defined as “The greater weight of the evidence… sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”
Prevailing Party
The party that is successful in a legal dispute. In the final order, the Respondent was deemed the prevailing party.
Respondent
The party against whom a petition is filed. In this case, the Tempe Gardens Townhouse Corporation.
Ripe for Adjudication
A term used by the Commissioner of the Department of Real Estate to indicate that a dispute is ready to be formally heard and decided by the Administrative Law Judge.
Blog Post – 17F-H1717038-REL
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3 sources
These documents chronicle the legal dispute between James and Shawna Larson (Petitioners) and the Tempe Gardens Townhouse Corporation (Respondent) concerning the removal of the Larsons’ patio cover for building maintenance. Initially, an Administrative Law Judge (ALJ) recommended dismissal because the Petitioners did not allege a current violation of the governing documents, thus lacking a justiciable controversy since the association had only threatened action. However, the Department of Real Estate Commissioner rejected this recommendation, asserting that a violation of the governing documents was alleged by the Respondent, making the matter ripe for adjudication. Following a rehearing, a different ALJ issued a final decision finding that the Respondent acted reasonably in requiring the patio cover removal for safe and proper painting and repairs, concluding that the Petitioners must bear the cost of removal and reinstallation as the cover is a limited common element.
Based on 3 sources
Case Participants
Petitioner Side
James Larson(petitioner)
Shawna Larson(petitioner)
Lisa M. Hanger(attorney) Counsel for Petitioners
Respondent Side
Nathan Tennyson(attorney) Brown Alcott PLLC Counsel for Respondent Tempe Gardens Townhouse Corporation
Wayne King(witness) Project manager hired by Respondent for the painting project; provided testimony
Neutral Parties
Suzanne Marwil(ALJ) Office of Administrative Hearings Authored Recommended Order Dismissal dated August 25, 2017
Thomas Shedden(ALJ) Office of Administrative Hearings Authored Administrative Law Judge Decision dated December 11, 2017
Judy Lowe(Commissioner) Arizona Department of Real Estate Rejected Recommendation of Dismissal
Dan Gardner(HOA coordinator) Transmitted documents (Order Rejecting Recommendation of Dismissal)
Other Participants
Chris Morga(contractor) Jacob and Co. Mentioned as a vendor who could remove patio covers
The ALJ dismissed the petition, ruling that the HOA acted reasonably and had the authority under the CC&Rs to require the removal of the homeowner's patio cover for necessary painting and repairs. The ALJ determined that because the patio cover is a limited common element, the Petitioners must bear the cost of removal and reinstallation according to A.R.S. § 33-1255(C).
Why this result: Petitioners failed to prove the HOA violated CC&Rs or acted unreasonably, and statutory law assigned the expense burden for the limited common element to the homeowner.
Key Issues & Findings
Authority of HOA to mandate removal of homeowner's patio cover for maintenance and assignment of removal/reinstallation costs.
Petitioners challenged the Respondent HOA's authority and reasonableness in requiring them to remove their patio cover, a limited common element, for building painting and repair, and disputed the requirement that Petitioners bear the costs. The ALJ concluded that the HOA's plan was reasonable, the HOA had the authority under CC&R sections 9 and 9(b), and Petitioners must bear the cost of removal and reinstallation under A.R.S. § 33-1255(C).
Orders: Petitioners’ petition is dismissed. Respondent is deemed the prevailing party. Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
Cited:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
Analytics Highlights
Topics: HOA authority, limited common element, maintenance costs, patio cover, CC&Rs, statutory interpretation, dismissal, prevailing party
Additional Citations:
A.R.S. § 33-1255(C)
CC&R section 9
CC&R section 9(b)
A.R.S. § 33-1212(4)
Tierra Ranchos Homeowners Ass'n v. Kitchukov
A.R.S. § 32-2199
A.R.S. § 32-2199.02
A.R.S. § 41-1092.09
ARIZ. ADMIN. CODE § R2-19-119
Gutierrez v. Industrial Commission of Arizona
Audio Overview
Decision Documents
17F-H1717038-REL Decision – 583987.pdf
Uploaded 2025-10-08T06:51:36 (53.0 KB)
17F-H1717038-REL Decision – 585505.pdf
Uploaded 2025-10-08T06:51:37 (385.9 KB)
Briefing Doc – 17F-H1717038-REL
Briefing on Larson v. Tempe Gardens Townhouse Corporation
Executive Summary
This briefing synthesizes the legal dispute between homeowners James and Shawna Larson and the Tempe Gardens Townhouse Corporation (the “Respondent” or “HOA”). The core conflict centered on the HOA’s directive that the Larsons remove their wooden patio cover at their own expense to facilitate a community-wide building repair and painting project.
The case progressed through two distinct phases. Initially, an Administrative Law Judge (ALJ) recommended dismissing the Larsons’ petition for a lack of a “justiciable controversy,” reasoning that the HOA had not yet acted on its threat to remove the patio cover, rendering the dispute speculative. However, the Commissioner of the Department of Real Estate rejected this recommendation, finding the matter was “ripe for adjudication,” and ordered a full hearing on the merits.
In the final decision, a second ALJ dismissed the Larsons’ petition and ruled in favor of the HOA. The judge found the HOA’s plan to be reasonable and necessary for the proper and safe completion of the project, based on credible testimony from the project manager. The decision affirmed the HOA’s authority under its CC&Rs to require the removal of the structure. Crucially, the ruling established that the patio cover is a “limited common element” under Arizona law. Consequently, pursuant to Arizona Revised Statutes, the homeowners (the Larsons) are exclusively responsible for all costs associated with it, including its removal and potential reinstallation.
Procedural History and Jurisdictional Rulings
Initial Petition and Dismissal Recommendation
On June 16, 2017, James and Shawna Larson filed a petition with the Department of Real Estate against their HOA, alleging a violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs). However, the initial filing did not specify which provisions had been violated.
Upon inquiry, the Petitioners’ counsel admitted via email that no specific provision of the CC&Rs had yet been violated. Instead, their concern was that section 10(a) would be violated if the HOA acted on its threat to forcibly remove their patio cover and charge them for the cost.
This led to the “ORDER RECOMMENDING DISMISSAL FOR LACK OF JUSTICIABLE CONTROVERSY,” issued on August 25, 2017, by Administrative Law Judge Suzanne Marwil. The key findings of this order were:
• Speculative Harm: The Judge found that the HOA’s actions “have not yet been undertaken and our [are] speculative at this juncture.”
• Lack of Jurisdiction: The order stated that the Office of Administrative Hearings’ jurisdiction, per A.R.S. § 32-2199, is limited to adjudicating existing violations of community documents, not potential future ones.
• Misunderstanding by Both Parties: The order noted, “Both parties fundamentally misunderstand the limits of this Tribunal’s jurisdiction.” The Petitioners were seeking a ruling on a future action, while the Respondent was urging the Tribunal to find the Petitioners had violated the CC&Rs, which was not the subject of the petition.
• Recommended Forum: The Judge suggested that the appropriate forum for the Petitioners would be a declaratory judgment action in superior court.
Rejection of Dismissal and Re-Hearing
On August 31, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued an “ORDER REJECTING RECOMMENDATION OF DISMISSAL.”
• The Commissioner rejected the ALJ’s finding that the matter lacked a justiciable controversy.
• The order cited a letter from the Respondent dated June 1, 2017, which posed the question: “Is the presence of the awning a violation of the Association’s governing documents?”
• This question was deemed sufficient to make the matter “ripe for adjudication.”
• The Commissioner requested that the hearing be rescheduled for a ruling on the matter. A re-hearing was subsequently conducted on November 20, 2017, before Administrative Law Judge Thomas Shedden.
Analysis of the Merits of the Dispute
The re-hearing focused on the substantive conflict: whether the HOA had the authority to compel the Larsons to remove their patio cover at their own expense for the maintenance project.
Respondent’s (HOA) Case
The HOA, consisting of 169 units, initiated a project to make necessary repairs to its twenty-five buildings and then have them painted. The HOA’s position was based on the following points:
• Legal Authority: The HOA asserted its authority under sections 9 and 9(b) of its CC&Rs, which state that the HOA is responsible for maintaining building exteriors and that “Any cooperative action necessary or appropriate to the proper maintenance and upkeep of the… [building] exteriors… shall be taken by the [Respondent].”
• Project Necessity: The project manager, Wayne King, provided testimony that the HOA’s board deemed credible and reasonable.
◦ Safety: King stated that all five bidding contractors required the patio covers to be removed to ensure a safe work environment as mandated by the Arizona Department of Occupational Safety and Health (OSHA).
◦ Logistics: Standard scaffolding would not fit without removing the covers, commercial scaffolding would not provide full access, a forklift was not viable due to overhead power lines, and allowing painters to walk on homeowner patio covers was unsafe.
◦ Quality of Work: The project involved sanding, power washing, and patching before painting to “do the job right.” Many covers had been improperly flashed, causing damage to the buildings that needed repair.
◦ Warranty: The paint company would not provide a warranty for the project if individual homeowners, such as the Larsons, were permitted to paint their own units.
Petitioners’ (Larsons’) Case
The Larsons, who purchased their unit in 1999 with the wooden patio cover already in place, contested the HOA’s demands.
• Challenge to Authority: The Petitioners argued that the HOA had no legal authority to demand the removal of their patio cover.
• Unreasonable Cost: They asserted that the cost of removal and reinstallation was unreasonable, submitting two bids:
◦ One bid quoted $1,250 to remove and dispose of the cover and $3,980 to remove and rebuild it with new wood.
◦ A second bid quoted $5,975 to remove and then replace the structure.
• Proposed Alternative: In a letter dated May 19, 2017, the Larsons offered to have the back of their unit painted at their own expense.
• Compromise Offer: During the November 20, 2017 hearing, after hearing the project manager’s testimony, Ms. Larson offered that they would agree not to reinstall the patio cover if the HOA would pay for its removal.
Final Administrative Law Judge Decision
On December 11, 2017, ALJ Thomas Shedden issued a final decision dismissing the Larsons’ petition and finding in favor of the Respondent, Tempe Gardens Townhouse Corporation.
Key Findings and Conclusions of Law
Finding/Conclusion
Details
Standard of Review
The HOA’s decisions regarding maintenance and repair are given deference, provided they act reasonably.
Reasonableness of HOA Action
Based on the “credible testimony” of Wayne King, the Judge found that the HOA’s proposed plan for repairing and painting the buildings, which required the removal of patio covers, was reasonable.
HOA Authority
CC&R sections 9 and 9(b) were found to be “sufficient to show that Respondent has the authority to remove Petitioners’ patio to complete the painting work.”
Patio Cover Classification
The Petitioners’ patio cover was legally classified as a “limited common element” within the meaning of ARIZ. REV. STAT. section 33-1212(4).
Cost Responsibility
The central issue of payment was decided by statute. The Judge concluded that under a “reasonable reading of ARIZ. REV. STAT. section 33-1255(C),” any common expense associated with a limited common element “shall be assessed exclusively against the units benefitted.”
Final Order
Based on these findings, the Administrative Law Judge ordered the following:
“The evidence of record supports a conclusion that Respondent has authority to require Petitioners to remove their patio cover to allow the building to be properly and safely painted, and that Petitioners are responsible for the cost to remove the patio cover and the cost to reinstall it should they choose to do so.”
The final order was that the Petitioners’ petition be dismissed, and the Respondent, Tempe Gardens Townhouse Corporation, was deemed the prevailing party.
