William P Lee vs. Greenlaw Townhouses Unit Two Homeowners Association

Posted on December 27, 2018 by [email protected]

Case Summary

Case ID	19F-H1918019-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2019-04-22
Administrative Law Judge	Velva Moses-Thompson
Outcome	none
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	William P. Lee	Counsel	—
Respondent	Greenlaw Townhouses Unit Two Homeowners Association	Counsel	Timothy D. Butterfield, Esq.

Alleged Violations

CC&Rs amendments 1, 2, & 3; Greenlaw Rules and Regulations; A.R.S. §§ 33-1803, 33-1809

Outcome Summary

The ALJ denied the petition after rehearing, concluding the Petitioner failed to prove by a preponderance of the evidence that the HOA violated its CC&Rs, controlling Rules and Regulations (revised July 2018), or relevant statutes (A.R.S. §§ 33-1803 and 1809) by banning parking on association streets and implementing a booting/towing contract.

Why this result: The Petitioner failed to meet the burden of proof to establish the alleged violations of community documents or A.R.S. statutes by a preponderance of the evidence.

Key Issues & Findings

Alleged violation of community documents and statutes regarding parking ban and vehicle booting/towing

Petitioner alleged the HOA violated its CC&Rs amendments 1, 2, and 3, and Rules and Regulations, by banning all parking on association streets and contracting for vehicle booting/towing. Petitioner also contested the validity of the 2018 revised Rules and Regulations due to improper notice and alleged violations of A.R.S. §§ 33-1803 and 1809.

Orders: Petitioners' petition is denied.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

A.R.S. § 32-2199(B)
A.R.S. § 33-1803
A.R.S. § 33-1809
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
A.A.C. R2-19-119(B)(1)
Powell v. Washburn, 211 Ariz. 553, 556 ¶ 9, 125 P.3d 373, 376
Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs., 867 P.2d 70, 75

Analytics Highlights

Topics: HOA Rule Enforcement, Parking Restrictions, CC&Rs, Rules and Regulations, Towing/Booting, Notice Requirement

Additional Citations:

A.R.S. § 32-2199(B)
A.R.S. § 33-1803
A.R.S. § 33-1809
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
A.A.C. R2-19-119(B)(1)
Powell v. Washburn, 211 Ariz. 553
Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs., 867 P.2d 70

Video Overview

Audio Overview

Decision Documents

19F-H1918019-REL Decision – 703187.pdf

Uploaded 2026-04-24T11:16:51 (110.8 KB)

19F-H1918019-REL Decision – 678471.pdf

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19F-H1918019-REL Decision – 678471.pdf

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19F-H1918019-REL Decision – 703187.pdf

Uploaded 2026-01-23T17:27:03 (110.8 KB)

Administrative Hearing Briefing: William P. Lee v. Greenlaw Townhouses Unit Two

Executive Summary

This document analyzes the Administrative Law Judge Decision in case No. 19F-H1918019-REL-RHG, where Petitioner William P. Lee’s complaint against the Greenlaw Townhouses Unit Two Homeowners Association (Greenlaw) was denied. Mr. Lee, a homeowner, alleged that Greenlaw’s complete ban on street parking and its contract with a towing company to enforce the ban violated the association’s Covenants, Conditions, and Restrictions (CC&Rs).

The Administrative Law Judge (ALJ) found that Mr. Lee failed to meet the required burden of proof. The central conclusion was that Greenlaw’s revised Rules and Regulations, effective July 2018, are the controlling authority and explicitly permit a total ban on street parking. The ALJ determined that the specific parking prohibitions detailed in the CC&R amendments—concerning fire lanes, snow removal, and abandoned vehicles—do not preclude the association from enacting a more comprehensive ban via its rules. Furthermore, the petitioner failed to provide sufficient evidence that Greenlaw had actually taken the alleged enforcement actions (booting or towing) against any member’s vehicle.

Case Overview

Detail

Information

Case Name

William P. Lee v. Greenlaw Townhouses Unit Two

Case Number

19F-H1918019-REL-RHG

Arizona Office of Administrative Hearings

Petitioner

William P. Lee (Homeowner)

Respondent

Greenlaw Townhouses Unit Two (Homeowners Association)

Hearing Date

April 1, 2019 (Rehearing)

Decision Date

April 22, 2019

Final Order

Petitioner’s petition is denied.

Presiding ALJ

Velva Moses-Thompson

Petitioner’s Core Allegations and Arguments

William P. Lee’s petition, filed on September 12, 2018, centered on the claim that Greenlaw acted outside its authority by banning all street parking and contracting with a towing company for enforcement. His arguments were:

• Violation of CC&Rs: The total parking ban directly contradicted CC&R Amendments 1, 2, and 3. Mr. Lee contended these amendments established an exhaustive list of permissible parking restrictions, limited to:

◦ Designated fire lanes (Amendment #1).

◦ Periods of snow removal (Amendment #2).

◦ Vehicles in an obvious state of disrepair for over 72 hours (Amendment #3).

• Invalidity of Revised Rules: Mr. Lee argued that the July 2018 revised Rules and Regulations, which contain the parking ban, were not valid or controlling due to improper notification.

◦ He contended that Greenlaw’s Bylaws (Article V, Section 1) required that such notices be delivered personally or by postal mail.

◦ He received notice only via a July 6, 2018 email, which he claimed did not clearly indicate that the rules had been substantively changed.

• Improper Motive: Mr. Lee contended that “the only reason that the Association banned parking was to please Barbara, a board member who did not want anyone to park behind her property.”

Respondent’s Defense

Greenlaw Townhouses Unit Two asserted that its actions were proper and within the scope of its authority as an HOA. Its defense included the following points:

• Controlling Authority: Greenlaw maintained that its revised Rules and Regulations, effective July 2018, were the controlling documents governing parking.

• Notice Protocol: The association contended that the Bylaw provision requiring personal or postal mail notice applies only to notices mandated by statute or the CC&Rs. Greenlaw argued there is no such requirement for providing notice of amendments to the Rules and Regulations.

• Sufficient Notice: Greenlaw asserted that Mr. Lee received actual notice of the revised rules via the email sent on July 6, 2018.

Analysis of Key Governing Documents

The case revolved around the interpretation of and interplay between several of Greenlaw’s governing documents.

Document

Key Provision / Content

Relevance to Case

CC&R Amendments 1, 2, & 3

These amendments, added to Article II (Permitted Uses), establish specific, conditional parking prohibitions related to fire lanes, snow removal, and abandoned vehicles.

The petitioner argued these amendments represented the only circumstances under which parking could be banned. The ALJ found they were not an exhaustive list.

Bylaws, Article V, Section 1

“Notices to directors and lot owners shall be in writing and delivered personally or mailed to the directors or lot owners at their addresses appearing on the books of the corporation.”

The petitioner cited this to argue that the email notice for the revised rules was improper, thus invalidating the rules. The ALJ sided with the Respondent’s interpretation.

Rules and Regulations (July 2018), Section 8

“Parking is not allowed on any association street or alleyway at any time… cars parked in violation may be booted and/or towed by a contracted independent towing company.” The rule specifies that the streets (Eva, Heidi, Jeffrey Loops) are private and owned by the HOA.

This document contains the explicit, total parking ban at the heart of the dispute. The ALJ found this rule to be the valid and controlling authority.

Administrative Law Judge’s Findings and Conclusions

The ALJ’s decision was based on a comprehensive review of the evidence and legal standards, ultimately concluding that the petitioner failed to prove his case.

Burden of Proof

The decision established that Mr. Lee bore the burden of proof “to establish that Greenlaw violated amendments 1, 2, and 3 of the CC&Rs, and the Greenlaw Rules and Regulations by a preponderance of the evidence.” A preponderance of the evidence is defined as proof that convinces the trier of fact a contention is “more probably true than not.”

Key Conclusions of Law

1. Validity of the 2018 Rules: The ALJ concluded that “the weight of the evidence presented at hearing shows that Greenlaw’s Rules and Regulations were revised effective July 2018 and are the controlling Rules and Regulations of Greenlaw.” Mr. Lee failed to establish that any prior version remained in effect.

2. Scope of CC&R Amendments: The decision found that the CC&R amendments only “provide specific scenarios in which parking on the streets is banned.” They do not restrict the association from implementing a broader ban through its Rules and Regulations. Therefore, the total ban did not violate the CC&Rs.

3. No Violation of Rules: Because the July 2018 rules were found to be controlling, and they explicitly authorize a total parking ban, the ALJ concluded that Greenlaw’s decision did not violate its own Rules and Regulations.

4. Insufficient Evidence of Enforcement: A critical failure in the petitioner’s case was the lack of evidence.

◦ The decision notes, “Mr. Lee provided no evidence that Greenlaw booted or towed any of the vehicles belonging to Greenlaw members.”

◦ His testimony about observing a booted jeep was dismissed as insufficient, as he “did not know who owned the jeep, nor who was responsible for booting the jeep.” The Greenlaw manager’s subsequent comment was not found to be an admission of responsibility.

◦ Mr. Lee did not allege that any of his own vehicles had been booted or towed.

5. No Statutory Violation: The judge found that Mr. Lee failed to establish any violation of Arizona Revised Statutes §§ 33-1803 and 33-1809.

Final Order and Implications

Based on these findings, the Administrative Law Judge issued a final, binding order.

• Order: “IT IS ORDERED that Petitioners’ petition is denied.”

• Appeal Process: As the order resulted from a rehearing, it is binding on the parties. Any party wishing to appeal must seek judicial review in the superior court within thirty-five days from the date the order was served.

Study Guide: Lee v. Greenlaw Townhouses Unit Two (Case No. 19F-H1918019-REL-RHG)

This guide provides a comprehensive review of the administrative law case between William P. Lee and the Greenlaw Townhouses Unit Two Homeowners Association. It covers the central conflict, the arguments presented by both parties, the key legal documents involved, and the final decision rendered by the Administrative Law Judge.

Case Overview

This case centers on a dispute between a homeowner, William P. Lee, and his Homeowners Association (HOA), Greenlaw Townhouses Unit Two. Mr. Lee filed a petition alleging that the HOA’s decision to ban all parking on association streets and contract with a towing company violated the community’s governing documents. The matter was decided by an Administrative Law Judge following a rehearing on April 1, 2019.

Key Parties and Roles

Party/Role

Name / Entity

Description

Petitioner

William P. Lee

A homeowner in Greenlaw Unit Two and member of the HOA who filed the petition against the association.

Respondent

Greenlaw Townhouses Unit Two

The Homeowners Association (HOA) responsible for governing the community, against which the petition was filed.

Legal Counsel

Timothy D. Butterfield, Esq.

Appeared on behalf of the Respondent, Greenlaw Townhouses.

Adjudicator

Velva Moses-Thompson

The Administrative Law Judge from the Office of Administrative Hearings who presided over the rehearing and issued the decision.

Timeline of Key Events

June 16, 1986

Greenlaw Bylaws were recorded at the Coconino County Recorder.

July 2, 1999

Greenlaw Declaration of Covenants, Conditions, and Restrictions (CC&Rs) was recorded.

July 6, 2018

Greenlaw sent an email to members with an attachment containing the revised Rules and Regulations, effective July 2018.

September 12, 2018

William P. Lee filed a petition with the Arizona Department of Real Estate.

December 13, 2018

The original hearing on the petition was conducted.

February 11, 2019

The Department of Real Estate issued an order for a rehearing.

April 1, 2019

The rehearing was held at the Office of Administrative Hearings.

April 22, 2019

The Administrative Law Judge issued the final decision, denying the petitioner’s petition.

The Central Conflict: Parking Regulations

The core of the dispute was Mr. Lee’s allegation that Greenlaw’s comprehensive ban on street parking, as stated in its revised 2018 Rules and Regulations, violated the more specific parking restrictions outlined in the community’s CC&Rs. The validity of the 2018 Rules and Regulations, and the method by which they were distributed to homeowners, was also a key point of contention.

• Violation of CC&Rs: The general ban on street parking violated Amendments 1, 2, and 3 of the CC&Rs, which only banned parking in specific situations (fire lanes, snow removal, abandoned vehicles).

• Improper Notice: Greenlaw failed to provide proper notice of the revised Rules and Regulations. Mr. Lee argued that the HOA’s Bylaws (Article V, Section 1) required notice to be delivered personally or by postal mail, not by email.

• Unclear Communication: The email sent on July 6, 2018, did not clearly state that the rules had been recently changed.

• Invalidity of New Rules: Due to the improper notice, Mr. Lee contended that the 2018 revised Rules and Regulations were not valid or controlling.

• Improper Motivation: Mr. Lee alleged the only reason for the ban was to appease a board member named Barbara who did not want anyone parking behind her property.

• Evidence of Enforcement: Mr. Lee testified that he observed a jeep being booted in a driveway and that the Greenlaw manager’s response implied the HOA’s contracted towing company could boot vehicles in violation.

• Notice Was Sufficient: Greenlaw contended that the Bylaw’s requirement for mail or personal delivery only applied to notices mandated by statute or the CC&Rs.

• No Notice Requirement: The HOA argued that it was not required by law or the CC&Rs to provide homeowners with notice of an amendment to the Rules and Regulations.

• Notice Was Received: Greenlaw asserted that Mr. Lee did, in fact, receive notice of the revised rules via the email sent on July 6, 2018.

• No Proof of Harm: Greenlaw pointed out that Mr. Lee provided no evidence that any vehicles belonging to Greenlaw members had been booted or towed by the association, nor did he allege that one of his own vehicles had been affected.

Governing Documents and Legal Principles

• Amendment #1: Bans parking in designated fire lanes.

• Amendment #2: Bans parking on subdivision roads during snow removal periods.

• Amendment #3: Allows for the towing of vehicles parked at the curb in an obvious state of disrepair for over 72 hours.

• Article V, Section 1: States that notices to directors and lot owners “shall be in writing and delivered personally or mailed.”

• Section 8: Explicitly states, “Parking is not allowed on any association street or alleyway at any time.” It identifies the streets (Eva, Heidi, and Jeffrey Loops) as “Private Fire Access Lanes” owned by the HOA and states that vehicles in violation may be booted and/or towed.

• The petitioner, Mr. Lee, bore the burden of proof to establish his claims by a preponderance of the evidence.

• The source defines preponderance of the evidence as “such proof as convinces the trier of fact that the contention is more probably true than not” and as evidence with “the most convincing force.”

The Judge’s Decision and Rationale

The Administrative Law Judge, Velva Moses-Thompson, denied Mr. Lee’s petition. The key conclusions of law were:

1. Controlling Document: The 2018 revised Rules and Regulations were found to be the valid and controlling rules for the Greenlaw HOA.

2. Authority to Ban Parking: The 2018 Rules and Regulations explicitly allow the association to ban all parking on its streets and to enforce this rule by booting or towing vehicles.

3. No Violation of CC&Rs: The judge concluded that Mr. Lee failed to prove that the general parking ban violated the specific, situational bans outlined in CC&R Amendments 1, 2, and 3. The amendments did not preclude the HOA from enacting a broader rule.

4. Failure to Meet Burden of Proof: Mr. Lee did not establish by a preponderance of the evidence that Greenlaw’s actions violated either the CC&Rs or the Rules and Regulations.

5. Insufficient Evidence of Enforcement: Mr. Lee failed to provide any evidence that Greenlaw was actually responsible for booting the jeep he observed. His testimony was not sufficient to prove the HOA had taken action against any member.

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Quiz: Test Your Understanding

Answer the following questions in 2-3 sentences based on the information in the study guide.

1. What was the central allegation in William P. Lee’s petition against the Greenlaw HOA?

2. What three specific scenarios for parking restrictions are outlined in Amendments 1, 2, and 3 of the Greenlaw CC&Rs?

3. On what grounds did Mr. Lee argue that the 2018 revised Rules and Regulations were not valid?

4. How did Greenlaw defend its use of email to distribute the revised Rules and Regulations to homeowners?

5. According to Section 8 of the revised Rules and Regulations, what are the potential consequences for parking on an association street?

6. What was the judge’s conclusion regarding the validity and authority of the 2018 revised Rules and Regulations?

7. What is the “preponderance of the evidence” standard, and who bore the burden of proof to meet it in this case?

8. Why did the judge find Mr. Lee’s testimony about a booted jeep to be insufficient evidence?

9. Did the judge find that Greenlaw’s general parking ban violated Amendments 1, 2, and 3 of the CC&Rs? Explain why or why not.

10. What was the final order issued by the Administrative Law Judge in this matter?

——————————————————————————–

Answer Key

1. Mr. Lee’s central allegation was that the Greenlaw HOA had violated its CC&Rs and Rules and Regulations. Specifically, he claimed the association’s decision to ban all parking on its streets and to contract with a company to boot vehicles was improper.

2. The CC&R amendments outline three specific parking restrictions. Amendment 1 bans parking in designated fire lanes, Amendment 2 bans parking on roads during snow removal, and Amendment 3 allows for the towing of abandoned vehicles in a state of disrepair for over 72 hours.

3. Mr. Lee argued the 2018 rules were invalid because he was not given proper notice. He contended that the HOA’s Bylaws required notice to be delivered personally or by postal mail, and that the email he received was not a valid method of distribution.

4. Greenlaw defended its use of email by arguing that the Bylaw’s requirement for personal or mail delivery only applied to notices that were required by statute or the CC&Rs. The HOA contended it was not required by law to provide notice for an amendment to its Rules and Regulations.

5. Section 8 states that cars parked in violation on an association street may be booted and/or towed by a contracted independent towing company. The rule identifies the streets as “Private Fire Access Lanes.”

6. The judge concluded that the Rules and Regulations revised in July 2018 were the controlling rules for Greenlaw. Furthermore, the judge found that these rules do allow the association to ban all parking on its streets and to tow or boot cars in violation.

7. A “preponderance of the evidence” is the standard of proof that convinces a judge that a contention is more probably true than not. In this case, the petitioner, William P. Lee, bore the burden of proving his claims by this standard.

8. The evidence was insufficient because Mr. Lee did not know who owned the jeep or who was responsible for booting it. There was no direct evidence provided that proved Greenlaw or its contractor was responsible for the action.

9. No, the judge did not find that the ban violated the CC&Rs. The judge reasoned that the amendments only provided specific scenarios where parking was banned and did not prevent the HOA from enacting a broader, more general parking ban in its Rules and Regulations.

10. The final order issued by the Administrative Law Judge was that the Petitioner’s (Mr. Lee’s) petition is denied.

——————————————————————————–

Essay Questions for Deeper Analysis

The following questions are for further reflection. No answers are provided.

1. Analyze the conflict between Greenlaw’s Bylaws (Article V, Section 1) regarding notice and its 2018 distribution of revised Rules and Regulations. Discuss both parties’ arguments and explain how the judge’s ultimate decision implies a resolution to this conflict.

2. Discuss the legal concept of “burden of proof” as it applies to this case. How did William P. Lee’s failure to meet the “preponderance of the evidence” standard affect the outcome of his claims regarding both the parking ban and the alleged booting/towing incidents?

3. Compare and contrast the parking restrictions detailed in the CC&R Amendments with the broader ban instituted in Section 8 of the 2018 Rules and Regulations. Explain why the existence of the specific amendments did not prevent the HOA from enacting a more general rule.

4. Evaluate the evidence presented by Mr. Lee. What were the strengths and weaknesses of his arguments and testimony, particularly concerning the booted jeep and the motivation behind the parking ban?

5. Imagine you are legal counsel for the Greenlaw HOA. Based on the arguments and outcome of this case, what advice would you give the Board of Directors regarding future amendments to its Rules and Regulations to avoid similar disputes?

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Glossary of Key Terms

• Administrative Law Judge (ALJ): An official who presides over hearings at administrative agencies. In this case, Velva Moses-Thompson served as the ALJ for the Office of Administrative Hearings.

• Affirmative Defenses: Arguments made by the respondent that, if proven, can defeat or mitigate the petitioner’s claim. The Respondent (Greenlaw) bears the burden to establish these defenses.

• Burden of Proof: The obligation of a party in a legal case to prove their allegations. In this case, Mr. Lee had the burden of proof to establish his claims.

• Bylaws: A set of rules adopted by an organization, such as an HOA, for governing its internal operations. Greenlaw’s bylaws addressed the method for providing notices to members.

• Covenants, Conditions, and Restrictions (CC&Rs): A set of rules governing the use of land in a planned community or subdivision. Owners agree to be bound by the CC&Rs.

• Homeowners Association (HOA): An organization in a planned community that makes and enforces rules for the properties and its residents. Greenlaw Townhouses Unit Two is the HOA in this case.

• Petitioner: The party who files a petition initiating a legal action. William P. Lee is the Petitioner.

• Preponderance of the Evidence: The standard of proof in which the trier of fact is convinced that a contention is “more probably true than not.” It is described as “the greater weight of the evidence.”

• Respondent: The party against whom a petition is filed; the party who must respond to the claims. Greenlaw Townhouses Unit Two is the Respondent.

• Rules and Regulations: A set of rules established by the HOA, in addition to the CC&Rs and Bylaws, that govern the day-to-day life and conduct within the community. The 2018 revised parking ban was located in Greenlaw’s Rules and Regulations.

Select all sources

703187.pdf

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19F-H1918019-REL-RHG

1 source

This document presents an Administrative Law Judge Decision from the Office of Administrative Hearings regarding a dispute between William P. Lee, a homeowner, and Greenlaw Townhouses Unit Two, his Homeowners Association. The central issue revolved around the Greenlaw HOA’s implementation of a comprehensive ban on street parking and its contracting with a towing company to enforce the rule, which Mr. Lee contended violated the association’s governing documents, specifically amendments to the Covenants, Conditions, and Restrictions (CC&Rs), and the proper notification procedures for revised rules. The findings of fact detail the history of the parking rules, the homeowner’s receipt of the electronic notification of the revised rules, and Mr. Lee’s arguments that the association failed to use the required postal mail or personal delivery methods for notice. The Conclusions of Law determined that the controlling rules were the revised July 2018 Rules and Regulations and that Mr. Lee failed to prove by a preponderance of the evidence that the HOA violated either the CC&Rs or relevant Arizona statutes. Consequently, the Judge ordered that the petitioner’s petition be denied.

Case Participants

Petitioner Side

William P. Lee (petitioner)
Greenlaw Townhouses Unit Two Homeowners Association member
Testified on behalf of himself

Respondent Side

Mark K. Sahl (HOA attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Timothy D. Butterfield (HOA attorney)
Greenlaw Townhouses Unit Two Homeowners Association
Barbara (board member)
Greenlaw Townhouses Unit Two Homeowners Association
Contended by Lee to be the reason for the parking ban

Neutral Parties

Velva Moses-Thompson (ALJ)
Office of Administrative Hearings
Judy Lowe (Commissioner)
Arizona Department of Real Estate

John A Sellers vs. Rancho Madera Condominium Association

Posted on December 26, 2018 by [email protected]

Case Summary

Case ID	19F-H1918010-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2019-05-10
Administrative Law Judge	Tammy L. Eigenheer
Outcome	loss
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	John A Sellers	Counsel	—
Respondent	Rancho Madera Condominium Association	Counsel	Edward D. O'Brien

Alleged Violations

CC&Rs § 3.10

Outcome Summary

The Administrative Law Judge dismissed the petition, finding that the HOA (Respondent) did not violate CC&R Section 3.10. The CC&Rs imposed the duty of keeping the drainage area clear primarily on the Unit Owners, and the HOA only retained the right to enforce this requirement, not an explicit obligation.

Why this result: Petitioner failed to establish by a preponderance of the evidence that Respondent violated the CC&Rs because the HOA did not have an obligation to enforce clearance requirements against unit owners under the cited covenant provisions.

Key Issues & Findings

Alleged violation of CC&Rs § 3.10 by failing to require unit owners to remove vegetation and fencing materials from the stormwater channel behind their homes.

Petitioner alleged the HOA violated CC&Rs § 3.10 by failing to compel unit owners to clear vegetation and debris (including chicken wire) from the stormwater drainage channel, asserting this failure created a flood risk to unit 12. The ALJ found that the CC&Rs placed the primary maintenance responsibility on Unit Owners, and the HOA only had the right, but not the obligation, to enforce clearance requirements.

Orders: The petition was denied and dismissed. No action was required of Respondent because Petitioner failed to establish that Respondent violated the CC&Rs regarding maintenance of the drainage easement.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

A.R.S. § 32-2199.01
Title 33, Chapter 9
A.A.C. R2-19-119(A) and (B)(1)
Vazanno v. Superior Court
A.A.C. R2-19-119(B)(2)
MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5
BLACK’S LAW DICTIONARY
Powell v. Washburn
Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs.

Analytics Highlights

Topics: HOA, CC&R, Drainage, Maintenance, Enforcement, Condominium

Additional Citations:

A.R.S. § 32-2199.01
Title 33, Chapter 9
A.A.C. R2-19-119(A) and (B)(1)
Vazanno v. Superior Court
A.A.C. R2-19-119(B)(2)
MORRIS K. UDALL, ARIZONA LAW OF EVIDENCE § 5
BLACK’S LAW DICTIONARY
Powell v. Washburn
Lookout Mountain Paradise Hills Homeowners’ Ass’n v. Viewpoint Assocs.

Video Overview

Audio Overview

Decision Documents

19F-H1918010-REL Decision – 706533.pdf

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19F-H1918010-REL Decision – 707530.pdf

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19F-H1918010-REL Decision – 667122.pdf

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19F-H1918010-REL Decision – 678371.pdf

Uploaded 2026-04-24T11:16:09 (129.5 KB)

19F-H1918010-REL Decision – 667122.pdf

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19F-H1918010-REL Decision – 678371.pdf

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Briefing Document: Sellers vs. Rancho Madera Condominium Association

Executive Summary

This document synthesizes the legal proceedings and outcomes of the case John A Sellers, Petitioner, vs. Rancho Madera Condominium Association, Respondent (Case No. 19F-H1918010-REL), adjudicated by the Arizona Office of Administrative Hearings. The core of the dispute was a claim by Petitioner John Sellers that his homeowner’s association (HOA) violated its Covenants, Conditions, and Restrictions (CC&Rs) by failing to compel other homeowners to remove vegetation and fencing from a common stormwater drainage channel, which he alleged created a flood risk to his property, Unit 12.

The petitioner’s claim was ultimately unsuccessful. It was denied first in an initial evidentiary hearing and again in a subsequent rehearing. The central finding of the Administrative Law Judges (ALJs) in both decisions was a critical distinction between an HOA’s right to enforce rules and an obligation to do so. The ALJs determined that the CC&Rs placed the primary responsibility for maintaining the drainage easement on the individual unit owners. The HOA’s mandatory duty to intervene was found to be triggered only by actual damage resulting from an owner’s negligence, not by the mere potential for future damage. As no flooding or damage had ever occurred, the HOA was found to have acted within its authority and had not violated the CC&Rs. The petitioner’s personal circumstances, including a contentious divorce and court-ordered sale of the property, were noted but deemed legally irrelevant to the determination of a CC&R violation.

Case Chronology and Procedural History

The case progressed through an initial petition, a hearing, a decision, a request for rehearing, and a final decision on rehearing. A notable procedural anomaly occurred when a hearing scheduled for November 5, 2018, was officially vacated due to a withdrawal notice from the petitioner, yet the hearing proceeded on that date as originally planned.

Details

Aug 23, 2018

Petition Filed

John A. Sellers filed a single-issue petition with the Arizona Department of Real Estate alleging the Rancho Madera Condominium Association violated CC&R § 3.10.

Oct 23, 2018

Hearing Vacated

An order was issued by ALJ Diane Mihalsky vacating the November 5 hearing because the petitioner had notified the Department of his wish to withdraw the petition.

Nov 5 & Dec 12, 2018

Initial Hearing

Despite the prior vacating order, an evidentiary hearing was held before ALJ Mihalsky.

Dec 26, 2018

Initial Decision

ALJ Mihalsky issued a decision finding that the petitioner failed to prove his case. The petition was denied.

Feb 1, 2019

Rehearing Requested

The petitioner filed a request for a rehearing, alleging procedural irregularities and errors in the initial decision.

Feb 22, 2019

Rehearing Granted

The Commissioner of the Department of Real Estate granted the request for a rehearing.

Apr 15, 2019

Rehearing Held

A rehearing was held before a new judge, ALJ Tammy L. Eigenheer.

May 7, 2019

Post-Hearing Filing Stricken

The petitioner submitted an unauthorized supplemental argument after the rehearing. ALJ Eigenheer issued an order striking the filing from the record and closing the record.

May 10, 2019

Final Decision on Rehearing

ALJ Eigenheer issued a final decision, again finding for the respondent and dismissing the petition.

Core Dispute Analysis

Petitioner’s Position and Allegations

• Core Allegation: The petitioner alleged that the Rancho Madera Condominium Association (Respondent) violated CC&R § 3.10 by failing to enforce its rules. Specifically, the Association did not require owners of “Drainage Easement Units” to remove obstructions—such as large succulents, cacti, shrubs, and chicken wire fencing—from a 3′ x 3′ stormwater drainage canal located behind their homes.

• Perceived Risk: The petitioner testified that these items could catch storm debris, clog the channel, and cause flooding that would damage his property, Unit 12. He submitted videos of heavy rains to support his concern.

• Evolving Legal Argument: In the rehearing, the petitioner’s argument shifted. He acknowledged that the CC&Rs gave the Association the right to enforce maintenance standards but argued that “at a certain point exercising a right becomes an obligation,” particularly when matters of safety and property values are implicated.

• Claimed Financial Damages: The petitioner testified he was undergoing a contentious divorce and his condominium was being sold by order of the Maricopa County Superior Court. He asserted that due to the unresolved flood risk, which he was obligated to disclose, the sale price of Unit 12 was “$40,000 less than it would have been.”

Respondent’s Position and Actions

• Denial of Violation: The Association denied it had violated any CC&Rs by its handling of the drainage channel.

• Evidence and Testimony: The Association, represented by its President, Jeffrey Kaplan, presented several key points:

◦ No History of Flooding: Mr. Kaplan testified that Unit 12 had never sustained any flood damage since the development was built in 2012, including during a “100-year storm” in 2014. After a significant rainstorm in August 2018, he personally inspected the easement and saw no water in it.

◦ Origin of Plants: Mr. Kaplan stated that the builder had originally planted the vegetation in the drainage easement that the petitioner was concerned about.

◦ No Other Complaints: No other members of the 46-unit Association had expressed any concerns about drainage.

◦ Proactive Communication: To assuage the petitioner’s concerns, the Association’s management company sent letters to the relevant homeowners on April 18, 2018, and July 19, 2018, reminding them of their responsibility to keep the drainage area free of obstructions.

◦ Due Diligence: Mr. Kaplan contacted officials at the Maricopa County Flood Control District and the Town of Cave Creek, who confirmed the drainage area was not on any official floodplain maps and that the Association was solely responsible for its maintenance.

Key CC&R Provisions and Legal Interpretation

The ALJs’ decisions hinged on a close reading of the Rancho Madera CC&Rs. The analysis consistently differentiated between the duties of individual owners and the duties of the Association.

• CC&R § 3.10.2 — Unit Owner Responsibility: This section places the primary maintenance burden directly on the homeowners of the Drainage Easement Units.

◦ Interpretation: The legal conclusion was that this provision unambiguously makes individual owners responsible for keeping their portion of the easement clear.

• CC&R § 3.10.4 — Association Responsibility: This section defines the specific circumstance under which the Association is required to act.

◦ Interpretation: Both ALJs found that this clause creates a reactionary, not a proactive, duty for the Association. Its obligation to repair is triggered by actual damage occurring, not by a perceived risk of future damage.

• CC&R § 13.1.1 — Association Enforcement Power: This section, highlighted in the rehearing, grants the Association authority to act.

◦ Interpretation: The ALJ in the rehearing ruled that this language grants a discretionary right, not a mandatory obligation. The CC&Rs contain no provision that converts this right into a duty under the circumstances presented by the petitioner.

Judicial Findings and Rulings

Initial Decision (ALJ Diane Mihalsky, Dec 26, 2018)

• Burden of Proof: The petitioner failed to establish his claim by a preponderance of the evidence.

• Findings of Fact: The petitioner successfully established that plants and chicken wire existed in the stormwater canal. However, he failed to establish that these items actually impeded the flow of water.

• Conclusion: The respondent proved that the drainage canal had functioned as intended since 2012 and that Unit 12 had never flooded. The petitioner’s divorce was noted to have “cast a long shadow over his administrative complaint” but was irrelevant to the legal issue. The petition was denied.

Rehearing Decision (ALJ Tammy L. Eigenheer, May 10, 2019)

• Central Legal Finding: The CC&Rs clearly intend for unit owners to bear the primary responsibility for keeping the drainage area clear. The Association’s only specified obligation is to repair damage after it has occurred and bill the responsible owner.

• Right vs. Obligation: The decision explicitly states, “While Respondent has the right to enforce the requirements that the Unit Owners keep the Drainage Easement Area clear, nothing in the CC&Rs provides that Respondent has an obligation to do so.”

• Final Order: The petitioner failed to establish that the respondent violated Section 3.10 of the CC&Rs. The petition was dismissed.

Notable Evidence

A key piece of evidence submitted by the respondent was a June 22, 2018, email from the petitioner’s wife, Debborah Sellers, which directly refuted the petitioner’s claims. In the email, she stated:

“There has never been any issue with the storm drain behind our house and it is not a major disclosure item… Stop making something out of nothing. AND I HOPE YOU AREN[’]T FREAKING POTENTIAL BUYERS AND OTHER REALTORS WITH THIS NONSENSE.”

Study Guide for Case No. 19F-H1918010-REL: Sellers v. Rancho Madera Condominium Association

Short-Answer Quiz

Instructions: Answer the following questions in 2-3 sentences, drawing exclusively from the information provided in the case documents.

1. What was the specific allegation John A. Sellers made against the Rancho Madera Condominium Association in his petition filed on August 23, 2018?

2. Identify the key responsibilities assigned to individual unit owners of Drainage Easement Units according to Section 3.10.2 of the CC&Rs.

3. Who is Jeffrey Kaplan, and what key testimony did he provide on behalf of the Respondent?

4. What specific actions did the Respondent’s management company take in April and July of 2018 to address the Petitioner’s concerns?

5. According to the decision by Administrative Law Judge Diane Mihalsky, what did the Petitioner fail to establish regarding the plants and chicken wire in the drainage canal?

6. On what grounds did John A. Sellers file his Homeowner’s Association (HOA) Dispute Rehearing Request on February 1, 2019?

7. What was the Petitioner’s core argument regarding the Association’s “right to enforce” the CC&Rs versus an “obligation to enforce” them?

8. What was the final conclusion of Administrative Law Judge Tammy L. Eigenheer regarding the Association’s responsibilities under the CC&Rs?

9. What occurred after the April 15, 2019 rehearing when the Petitioner attempted to submit supplemental information to the Office of Administrative Hearings?

10. Describe the evidence presented in an email from Debborah Sellers and its relevance to the case.

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Answer Key

1. John A. Sellers alleged that the Rancho Madera Condominium Association violated Section 3.10 of its Covenants, Conditions, and Restrictions (CC&Rs). He claimed the Association failed to require condominium owners to remove vegetation and fencing materials from the stormwater channel, creating a flood risk for his unit.

2. Section 3.10.2 of the CC&Rs requires each Unit Owner of a Drainage Easement Unit to keep their respective Drainage Easement Area free of weeds and other debris. The purpose is to ensure that stormwater can flow freely and that no improvement, including plant materials, impedes this flow.

3. Jeffrey Kaplan is the President of the Rancho Madera Condominium Association. He testified that the drainage easement had never failed, even during a 100-year storm in 2014, that the original builder had planted the vegetation in question, and that he had consulted with county and town officials about the drainage area.

4. To address the Petitioner’s concerns, the Respondent’s management company sent letters to the owners of the Drainage Easement Units. Letters sent on April 18, 2018, and July 19, 2018, reminded owners of their responsibility to keep the drainage area free of obstructions, weeds, and debris.

5. Judge Mihalsky’s decision on December 26, 2018, concluded that the Petitioner established the presence of plants and chicken wire but failed to establish that these items actually impede the flow of water. The judge found that the drainage system functions as intended and there was no unreasonable risk of flooding.

6. The Petitioner filed for a rehearing based on several alleged issues with the original proceeding. These included an irregularity in the proceedings, the existence of newly discovered evidence, errors in the admission or rejection of evidence, and a belief that the findings of fact or decision were arbitrary, capricious, or not supported by evidence.

7. The Petitioner argued that while the CC&Rs grant the Association the “right to enforce” maintenance requirements, this right becomes an “obligation” when issues of property values and safety are at stake. He maintained that the potential for flooding created such an obligation for the Association to act.

8. Judge Eigenheer concluded that the CC&Rs intend for unit owners to bear the responsibility of keeping the Drainage Easement Area clear. She determined that while the Association has the right to enforce this, nothing in the CC&Rs creates an obligation for it to do so, and its only specified responsibility is to repair damage after it occurs, billing the responsible unit owner.

9. After the rehearing, the Petitioner submitted supplemental authority and argument without having requested leave to do so. The Respondent’s counsel argued this filing was untimely and introduced new arguments, requesting it be struck. On May 7, 2019, Judge Eigenheer ordered the filing struck from the record and closed the record.

10. The Respondent submitted a June 22, 2018 email from Debborah Sellers, the Petitioner’s wife. In the email, she stated there had never been an issue with the storm drain, called his concerns “nonsense,” and noted that the developer had done a good job, undermining the Petitioner’s claim of a significant and obvious flood risk.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An independent judge who presides over administrative hearings, takes evidence, and makes legal decisions and orders. In this case, Diane Mihalsky and Tammy L. Eigenheer served as ALJs.

Covenants, Conditions, and Restrictions (CC&Rs)

The governing legal documents that set up the guidelines for a planned community or condominium association. In this case, the CC&Rs for Rancho Madera were the central document in the dispute.

Drainage Easement

A perpetual, non-exclusive legal right created over a specific portion of property (the eastern five feet of Units 9-18) for constructing and maintaining a stormwater drainage channel.

Drainage Easement Area

The specific portion of land encumbered by the Drainage Easement, defined as the eastern five feet of the designated units.

Drainage Improvements

The physical components of the drainage system, such as the channel, decomposed granite, rip rap (large stones), or concrete, as originally constructed by the developer.

Office of Administrative Hearings (OAH)

An independent state agency in Arizona responsible for conducting evidentiary hearings for other state agencies, such as the Department of Real Estate.

Petitioner

The party who initiates a legal action or files a petition seeking a legal remedy. In this case, John A. Sellers.

Preponderance of the Evidence

The standard of proof in this civil administrative case. It is defined as evidence that is sufficient to incline a fair and impartial mind to one side of an issue rather than the other, making a contention more probably true than not.

Rehearing

A second hearing of a case, granted by the Commissioner in this instance, to re-examine the issues based on claims such as procedural irregularities, newly discovered evidence, or errors in the original decision.

Respondent

The party against whom a petition is filed; the party who must respond to the petitioner’s claims. In this case, the Rancho Madera Condominium Association.

The Department

Refers to the Arizona Department of Real Estate, the state agency authorized to receive and decide on petitions for hearings from members of condominium unit owners’ associations.

I Read an Entire HOA Lawsuit. Here Are 4 Shocking Lessons About Power, Rules, and Reality.

The Anatomy of a Neighborhood War

Living under a Homeowner’s Association (HOA) often means navigating a complex world of rules, regulations, and neighborhood politics. For most, disagreements are minor annoyances. But sometimes, a seemingly small issue can escalate into a full-blown legal war.

This is the story of one homeowner’s single-minded crusade against his HOA over a stormwater drainage channel he believed was a serious flooding risk. After filing a formal petition, the dispute escalated into a multi-stage legal battle that spanned nearly a year. The official court documents reveal that even after a judge ruled decisively against him, the homeowner doubled down, demanding a rare rehearing.

A deep dive into this protracted case reveals a fascinating and cautionary tale. The legal reasoning that ultimately settled the matter highlights several surprising lessons that apply to anyone living in a planned community.

1. Proving a Rule Was Broken Isn’t the Same as Proving Harm

The initial hearing, held before Administrative Law Judge Diane Mihalsky in late 2018, centered on a seemingly straightforward argument from the petitioner, John Sellers. He pointed out that his neighbors had placed plants—including large succulents, shrubs, and cacti—as well as chicken wire in a stormwater drainage channel. This, he argued, was a clear violation of the community’s Covenants, Conditions, and Restrictions (CC&Rs), which stated that no improvement “shall be constructed, installed or allowed to grow… that may… impede the flow of water.”

But in her December 26, 2018 decision, the judge ruled against him. While Sellers successfully proved the obstructions existed, he failed to meet the legal burden of proof that they actually “impede the flow of water.” His claim was defeated by testimony from the HOA President, Jeffrey Kaplan, who stated that the unit had never sustained any flood damage, not even during a “100-year storm in 2014.”

The lesson from this first round is stark: in this legal context, simply pointing out a technical rule break was not enough. The petitioner had to prove that the violation was causing a tangible, negative impact. Without evidence of actual harm or impeded water flow, the theoretical risk was insufficient to win the case.

2. An HOA’s “Right” to Enforce Is Not an “Obligation”

After losing the first round on a question of evidence, Sellers’ argument evolved. He requested a rehearing, which was granted, and the case landed before a new judge, Tammy L. Eigenheer, in the spring of 2019. This shifted the legal focus from physical proof of impeded water flow to a more fundamental question of the HOA’s duties.

Sellers argued that because safety and property values were at stake, the association had a duty to enforce the CC&Rs and compel his neighbors to clear the drainage channel. He contended that at a certain point, an organization’s “right” to act becomes an “obligation.”

The judge’s final decision on May 10, 2019, was clear, absolute, and is where the most powerful lesson of the entire case lies.

“While Respondent has the right to enforce the requirements that the Unit Owners keep the Drainage Easement Area clear, nothing in the CC&Rs provides that Respondent has an obligation to do so.”

This distinction is critical for any homeowner. An HOA can possess the legal power to act but may not be legally compelled to use it. According to the judge’s interpretation, the governing documents placed the responsibility for keeping the channel clear on the individual unit owners. The association’s only stated obligation was to repair damage after it happened, with the cost being billed back to the responsible party.

3. Outside Conflicts Can Cast a Long Shadow

Legal disputes are rarely just about the facts of the case. During the initial hearing, it was revealed that the petitioner was going through a “contentious divorce” and that the condo unit at the center of the dispute was a community asset being sold by the court.

The most dramatic evidence, however, came from an email written by the petitioner’s own wife, Debborah Sellers. The email, submitted as evidence by the HOA, directly undermined his claims about the severity of the drainage issue.

In her decision, Judge Mihalsky officially stated that the divorce was “not relevant” to the technical question of whether the HOA violated the CC&Rs. However, she immediately added that the situation “cast a long shadow over his administrative complaint,” suggesting that the personal context, and especially the damaging email, severely harmed the petitioner’s credibility.

4. Writing Letters Isn’t the Same as Being Heard

Throughout the dispute, the petitioner made his concerns known by writing “many letters” to the HOA president. He was persistent in his written communications, attempting to force the issue onto the association’s radar.

Yet, this effort was contrasted with a notable lack of direct participation. According to the testimony of HOA President Kaplan during the first hearing, Sellers “never attended any of Respondent’s noticed Board meetings” where his concerns could have been discussed among the board members.

The HOA’s response to his letters was limited; it sent two general reminder letters to all residents in the affected area but did not take direct enforcement action against any specific homeowner. The practical takeaway is that to effect change or be taken seriously in an HOA dispute, visibility and participation are critical. Writing letters is a start, but attending official meetings to present a case in person can be a more effective strategy for ensuring an issue is formally addressed.

A Cautionary Tale for Any Homeowner

What began as a seemingly straightforward complaint about drainage and rule enforcement devolved into a legal battle that consumed nearly a year, involving two multi-day hearings before two different administrative law judges. The petitioner lost his case on the evidence, then lost it again on the law.

It serves as a potent cautionary tale, demonstrating that in the world of HOA disputes, the obvious path is not always the winning one. It leaves every homeowner with a final, thought-provoking question to ponder: When you see a problem in your community, how do you decide if a fight is worth the cost—not just in money, but in time, credibility, and peace?

Case Participants

Petitioner Side

John A Sellers (petitioner)

Respondent Side

Edward D. O’Brien (HOA attorney)
Carpenter, Hazlewood, Delgado & Bolen, PLC/LLP
Represented Respondent
Edith I. Rudder (HOA attorney)
Carpenter, Hazlewood, Delgado & Bolen, PLC/LLP
Represented Respondent
Jeffrey Kaplan (HOA President/witness)
Rancho Madera Condominium Association
Testified on behalf of Respondent

Neutral Parties

Diane Mihalsky (ALJ)
OAH
ALJ for initial proceedings
Tammy L. Eigenheer (ALJ)
OAH
ALJ for rehearing
Judy Lowe (Commissioner)
ADRE
LDettorre (ADRE staff)
ADRE
Recipient of transmission
AHansen (ADRE staff)
ADRE
Recipient of transmission
djones (ADRE staff)
ADRE
Recipient of transmission
DGardner (ADRE staff)
ADRE
Recipient of transmission
ncano (ADRE staff)
ADRE
Recipient of transmission
c. serrano (Clerical staff)
Transmitted document
F. Del Sol (Clerical staff)
Transmitted document

Other Participants

Debborah Sellers (witness)
Petitioner's wife, email submitted as evidence

Jerry R. Collis vs. Laveen Meadows Homeowners Association

Posted on December 18, 2018 by [email protected]

Case Summary

Case ID	19F-H18020-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-12-20
Administrative Law Judge	Thomas Shedden
Outcome	The Petitioner's challenge against the HOA was dismissed because the Petitioner failed to prove by a preponderance of the evidence that the HOA violated the community documents or statutes when issuing citations.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Jerry R. Collis	Counsel	—
Respondent	Laveen Meadows HOA c/o Planned Development Services	Counsel	Chad Gallacher, Esq.

Alleged Violations

CC&Rs Sections 10.11.2, 10.11.4, and 10.16; A.R.S. § 32-2199.01(A)

Outcome Summary

The Petitioner's challenge against the HOA was dismissed because the Petitioner failed to prove by a preponderance of the evidence that the HOA violated the community documents or statutes when issuing citations.

Why this result: Petitioner failed to meet the burden of proof.

Key Issues & Findings

Challenge to HOA fine citations/improper enforcement of parking and nuisance rules

Petitioner claimed the Respondent HOA improperly issued citations against him for vehicle violations (inoperable vehicle, street parking, nuisance), asserting the HOA could not violate CC&R 10.11.4 but that the citations alleging the violation were unwarranted.

Orders: Petitioner Jerry R. Collis’s petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
ARIZ. REV. STAT. § 32-2199.01

Analytics Highlights

Topics: HOA Enforcement, CC&Rs, Vehicle Parking, Nuisance, Burden of Proof

Additional Citations:

ARIZ. REV. STAT. Title 32, Ch. 20, Art. 11
ARIZ. ADMIN. CODE § R2-19-119
BLACK’S LAW DICTIONARY 1373 (10th ed. 2014)
McNally v. Sun Lakes Homeowners Ass’n #1, Inc., 241 Ariz. 1, 382 P.3d 1216 (2016 App.)
Tierra Ranchos Homeowners Ass'n v. Kitchukov, 216 Ariz. 195, 165 P.3d 173 (App. 2007)
ARIZ. REV. STAT. § 32-2199.01

Video Overview

Audio Overview

Decision Documents

19F-H18020-REL Decision – 677244.pdf

Uploaded 2026-04-24T11:14:51 (97.6 KB)

19F-H18020-REL Decision – 677244.pdf

Uploaded 2026-01-23T17:25:31 (97.6 KB)

Briefing Document: Collis v. Laveen Meadows HOA (Case No. 19F-H18020-REL)

Executive Summary

This document synthesizes the findings and decision in the administrative hearing of Jerry R. Collis (Petitioner) versus the Laveen Meadows HOA (Respondent). The Administrative Law Judge dismissed Mr. Collis’s petition, which alleged the HOA had wrongly issued citations concerning his vehicle.

The central issue revolved around a series of violation notices issued to Mr. Collis for an “Inoperable Vehicle.” While Mr. Collis focused his argument on proving the vehicle was, in fact, operational, the HOA successfully argued that the citations were based on a broader set of violations. These included not only the vehicle’s condition under CC&R Section 10.11.4 but also violations for street parking (Section 10.11.2) and creating a nuisance (Section 10.16) due to its unsightly appearance, which included cobwebs, debris, a flat tire, and a covered window.

The Judge concluded that the petitioner, Mr. Collis, failed to meet the burden of proof. By only addressing the vehicle’s operability, he did not disprove the other valid grounds for the citations. Consequently, the Judge found that the HOA had not violated its own governing documents or state statutes, dismissing the petition and declaring the HOA the prevailing party.

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1. Case Overview and Core Dispute

• Case Number: 19F-H18020-REL

• Parties:

◦ Petitioner: Jerry R. Collis (representing himself)

◦ Respondent: Laveen Meadows HOA (represented by Chad Gallacher, Esq.)

• Adjudicator: Thomas Shedden, Administrative Law Judge

• Hearing Date: December 4, 2018

• Decision Date: December 20, 2018

The Petitioner’s Allegation

On September 17, 2018, Jerry R. Collis filed a petition with the Arizona Department of Real Estate. The initial Notice of Hearing framed the allegation as the Laveen Meadows HOA having violated Article 10, Section 10.11.4 of its Covenants, Conditions, and Restrictions (CC&Rs), which pertains to inoperable vehicles.

At the December 4, 2018 hearing, Mr. Collis clarified his position. He argued that the issue was not that the HOA itself could violate that section, but that the HOA had wrongly issued him citations alleging a violation of that provision when his vehicle was fully operational.

The Respondent’s Position

The Laveen Meadows HOA, represented by Community Manager Lisa Riesland, objected to this reframing of the issue. The HOA contended that the citations issued to Mr. Collis were justified under multiple sections of the CC&Rs, not solely the “inoperable vehicle” clause. The HOA’s actions were based on violations of Sections 10.11.2 (street parking), 10.11.4 (inoperable vehicle), and 10.16 (nuisance).

2. Relevant CC&R Provisions

The dispute centered on the interpretation and application of three specific sections within the Laveen Meadows HOA CC&Rs.

Section

Title / Subject

Description

10.11.4

Inoperable Vehicles

Prohibits any motor vehicle “which are not in operating condition” from being parked in unenclosed areas, including driveways. This section was amended in May 2013 to clarify the definition of “operating condition.”

10.11.2

Street Parking

Prohibits parking on the streets within the community.

Nuisances

Prohibits nuisances, which are defined to include conditions that are “unsightly or that could reasonably cause annoyance to other members of the Association.”

3. Analysis of Evidence and Timeline

Violation Notices and Fines

Between September 2016 and June 2017, the HOA sent seven notifications to Mr. Collis regarding his vehicle. A key finding from the hearing was that while all seven notices stated, “Violation: Vehicle Parking – Inoperable Vehicle,” none of them cited a specific provision of the CC&Rs.

The timeline of notifications and fines is as follows:

• September 19, 2016: Initial letter citing expired tags and an inoperable vehicle on the street. Given 10 days to correct.

• October 11, 2016: Letter warning of a potential $25 fine. Notified of appeal rights. No evidence of appeal by Collis.

• December 1, 2016: A $25 fine was charged to Mr. Collis’s account. Mr. Collis appealed this to the HOA Board.

• January 26, 2017: The HOA Board sent a letter to Mr. Collis denying his appeal.

• April 20, 2017: A $50 fine and a $10 mailing fee were charged. No evidence of appeal.

• May 9, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• May 23, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• June 8, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

• June 26, 2017: A $100 fine and a $10 mailing fee were charged. No evidence of appeal.

For each fine assessed from October 2016 onwards, the HOA’s letters informed Mr. Collis of his right to appeal to the Board and to request an administrative hearing. The record shows no evidence that Mr. Collis requested an administrative hearing for any of the fines prior to filing his petition in 2018.

Competing Testimonies

• Petitioner (Collis): Testified that his vehicle was never inoperable. He acknowledged that at the time of the June 2017 letters, the vehicle had a flat tire and a covered window, but explained this was the result of vandalism.

• Respondent (HOA): Community Manager Lisa Riesland provided testimony deemed “credible” by the Judge. She stated that the vehicle’s condition constituted a nuisance under Section 10.16. Specific details included:

◦ Cobwebs and debris on or beneath the vehicle.

◦ At various times, cobwebs extended from the vehicle to the ground, trapping leaves.

◦ The condition was deemed “unsightly.”

4. Legal Conclusions and Final Order

Burden of Proof

The Judge established that Mr. Collis, as the petitioner, bore the burden of proof. The standard required was a “preponderance of the evidence,” meaning evidence sufficient to incline a fair and impartial mind to one side of the issue over the other.

Judge’s Rationale

The decision rested on the following legal conclusions:

1. CC&Rs as a Contract: The CC&Rs constitute a binding contract between the homeowner and the HOA, requiring both parties to comply with its terms. The HOA must act reasonably in exercising its authority.

2. Multiple Grounds for Citations: The preponderance of evidence demonstrated that the HOA’s citations were based on violations of Sections 10.11.2 (street parking), 10.11.4 (inoperable vehicle), and 10.16 (nuisance).

3. Insufficiency of Petitioner’s Argument: Because the citations were multifaceted, Mr. Collis’s argument that his vehicle was in operating condition was insufficient to prove the citations were unwarranted. His claim did not address the evidence of street parking or the unsightly conditions that constituted a nuisance.

4. Failure to Meet Burden of Proof: Ultimately, the Judge concluded: “Mr. Collis has failed to show that the Respondent violated any of the CC&Rs, other community documents, or the statutes that regulate planned communities.”

Final Order

IT IS ORDERED that Petitioner Jerry R. Collis’s petition is dismissed.

The decision established the Laveen Meadows HOA as the prevailing party. This order is binding unless a rehearing is requested with the Commissioner of the Department of Real Estate within 30 days of the service of the order (December 20, 2018).

Study Guide: Collis v. Laveen Meadows HOA

This guide provides a detailed review of the Administrative Law Judge Decision in the matter of Jerry R. Collis (Petitioner) versus Laveen Meadows HOA (Respondent), Case No. 19F-H18020-REL. It includes a short-answer quiz with an answer key, a set of essay questions for deeper analysis, and a glossary of key terms found within the legal document.

Short-Answer Quiz

Instructions: Answer the following questions in 2-3 sentences based on the provided source document.

1. Who were the primary parties involved in this administrative hearing, and who represented them?

2. What was the original violation Mr. Collis alleged against the Laveen Meadows HOA in his petition filed on September 17, 2018?

3. How did Mr. Collis clarify or reframe the issue he was raising during the December 4, 2018 hearing?

4. According to the HOA’s community manager, Lisa Riesland, what three CC&R sections were the basis for the citations issued to Mr. Collis?

5. What common phrase was used to describe the violation in all seven notifications sent to Mr. Collis, and what crucial detail did these notifications omit?

6. Describe the initial fine issued to Mr. Collis, including the date of the letter and the amount.

7. What physical evidence did the HOA present to support its claim that Mr. Collis’s vehicle created an “unsightly condition” under CC&R Section 10.16?

8. In addition to the unsightly conditions, what two other issues with the vehicle were noted around June 2017, and what was Mr. Collis’s explanation for them?

9. According to the “Conclusions of Law,” who bears the burden of proof in this matter, and what is the required standard of proof?

10. What was the final order issued by the Administrative Law Judge, and what was the legal consequence of this decision for the parties?

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Answer Key

1. The primary parties were Jerry R. Collis, the Petitioner, who appeared on his own behalf, and Laveen Meadows HOA, the Respondent. The Respondent was represented by Chad Gallacher, Esq.

2. Mr. Collis’s original petition, as shown in the Notice of Hearing, alleged that the Laveen Meadows HOA had violated Article 10, Section 10.11.4 of its own CC&Rs. This section pertains to parking motor vehicles that are not in operating condition in unenclosed areas.

3. At the hearing, Mr. Collis acknowledged the HOA could not violate its own rule and clarified that the real issue was that the HOA had wrongly issued him citations for violating Section 10.11.4. He argued that he was not, in fact, in violation of that provision.

4. Lisa Riesland testified that the citations were based not just on Section 10.11.4 (inoperable vehicles), but also on Section 10.11.2, which prohibits parking on the streets, and Section 10.16, which prohibits nuisances.

5. All seven notifications sent to Mr. Collis included the statement: “Violation: Vehicle Parking – Inoperable Vehicle.” However, none of the notifications listed a specific provision of the CC&Rs that had allegedly been violated.

6. The first fine was detailed in a letter dated December 1, 2016. The letter informed Mr. Collis that his account had been charged a $25 fine for the ongoing violation of storing an inoperable vehicle on the street.

7. The HOA presented credible testimony from Lisa Riesland that there were cobwebs and debris on or beneath the vehicle. At various times, these cobwebs extended from the vehicle to the ground and had trapped leaves, creating an unsightly condition.

8. Around June 2017, the vehicle also had a flat tire and a bag or cardboard covering one window. Mr. Collis acknowledged these facts and explained that the vehicle had been vandalized.

9. The “Conclusions of Law” state that Mr. Collis, the petitioner, bears the burden of proof. The standard of proof required to decide all issues in the matter is that of a “preponderance of the evidence.”

10. The Administrative Law Judge ordered that Mr. Collis’s petition be dismissed. This legally binding order deemed the Respondent (Laveen Meadows HOA) to be the prevailing party in the matter.

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Essay Questions

Instructions: The following questions are designed for longer, essay-style responses to encourage a deeper analysis of the case. Answers are not provided.

1. Analyze the discrepancy between Mr. Collis’s initial petition alleging a violation of Section 10.11.4 and the actual issue he raised at the hearing. How did this “reframing” of the issue affect his case, and how did the Respondent react?

2. Discuss the concept of “preponderance of the evidence” as defined in the document. Explain how the Administrative Law Judge applied this standard to the evidence presented by both Mr. Collis and the HOA to reach the final decision.

3. Trace the series of notifications and fines issued by the Laveen Meadows HOA, beginning with the September 19, 2016 letter. Evaluate the HOA’s process and communication based on the details provided in the letters. Did the HOA act reasonably, according to the legal standards cited in the decision?

4. The HOA cited three different CC&R sections (10.11.2, 10.11.4, and 10.16) as the basis for the citations, even though the notifications only stated “Vehicle Parking – Inoperable Vehicle.” Explore the significance of each of these sections and explain why Mr. Collis’s focus on his vehicle being operable was insufficient to win his case.

5. Examine the appeal options available to Mr. Collis at each stage of the violation process. Based on the “Findings of Fact,” what actions did he take or fail to take regarding his appeal rights, and how might this have impacted the overall trajectory of the dispute?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (Thomas Shedden in this case) who presides over administrative hearings, weighs evidence, and makes legal rulings and decisions.

ARIZ. ADMIN. CODE

The Arizona Administrative Code, a compilation of rules and regulations of Arizona state agencies. Section R2-19-119 is cited as establishing the standard of proof for the hearing.

ARIZ. REV. STAT.

The Arizona Revised Statutes, which are the codified laws of the state of Arizona. Various sections are cited regarding homeowner association disputes and administrative procedures.

Appearances

A formal term for the individuals present and participating in the hearing. In this case, it was Jerry R. Collis and Chad Gallacher, Esq.

The governing body of the Laveen Meadows HOA, to which Mr. Collis had the right to appeal fines. He appealed one fine to the Board, which was denied.

Burden of Proof

The legal obligation of a party in a dispute to provide sufficient evidence to prove their claim. In this case, the burden of proof was on Mr. Collis.

CC&Rs (Covenants, Conditions & Restrictions)

The governing legal documents that set out the rules for a planned community or homeowners’ association. The decision establishes the CC&Rs as a contract between the HOA and its members.

Community Manager

An individual responsible for managing the operations of the HOA. Lisa Riesland served this role for the Respondent and testified at the hearing.

Conclusions of Law

The section of the decision where the Administrative Law Judge applies legal principles and statutes to the established facts to reach a judgment.

Findings of Fact

The section of the decision that lists the established, undisputed facts of the case based on evidence and testimony presented during the hearing.

Nuisance

A condition prohibited by CC&R Section 10.16. It is defined as a condition that is unsightly or could reasonably cause annoyance to other members of the Association.

Operating Condition

A term from CC&R Section 10.11.4, which was amended in May 2013 to clarify its meaning. Mr. Collis argued his vehicle was always in operating condition.

The final, legally binding ruling of the Administrative Law Judge. In this case, the Order was to dismiss the petitioner’s petition.

Petitioner

The party who initiates a legal action or files a petition. In this matter, Jerry R. Collis is the Petitioner.

Preponderance of the Evidence

The standard of proof required in this hearing. It is 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.”

Respondent

The party against whom a petition is filed. In this matter, Laveen Meadows HOA is the Respondent.

🏛️

19F-H18020-REL

1 source

The provided text consists of an Administrative Law Judge Decision from the Office of Administrative Hearings concerning a dispute between Petitioner Jerry R. Collis and the Laveen Meadows HOA, which is the Respondent. This decision addresses Mr. Collis’s petition alleging the HOA violated its CC&Rs by improperly issuing citations related to his vehicle. The Findings of Fact detail that Mr. Collis’s vehicle was cited for being inoperable, having expired tags, and creating an unsightly condition defined as a nuisance under multiple CC&R sections. Ultimately, the Conclusions of Law state that Mr. Collis failed to meet his burden of proof to show the HOA violated any community documents or statutes, leading to the dismissal of his petition.

Case Participants

Petitioner Side

Jerry R. Collis (petitioner)

Respondent Side

Chad Gallacher (HOA attorney)
Maxwell & Morgan, P.C.
Counsel for Respondent Laveen Meadows HOA
Lisa Riesland (community manager)
Laveen Meadows HOA
Testified for Respondent

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Judy Lowe (Commissioner)
Arizona Department of Real Estate

Other Participants

f del sol (admin support)
Signed copy distribution notice

George E Lord vs. The Boulders at La Reserve Condominium Association

Posted on December 17, 2018 by [email protected]

Case Summary

Case ID	19F-H1918013-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-12-17
Administrative Law Judge	Tammy L. Eigenheer
Outcome	The Administrative Law Judge dismissed the Petition in its entirety, concluding that the Petitioner failed to establish by a preponderance of the evidence that the Respondent Condominium Association violated A.R.S. § 33-1242, A.R.S. § 33-1260.01, or the association's CC&Rs.
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	George E Lord	Counsel	—
Respondent	The Boulders at La Reserve Condominium Association	Counsel	Maria Kupillas

Alleged Violations

A.R.S. § 33-1242, A.R.S. § 33-1260.01, and CC&Rs

Outcome Summary

The Administrative Law Judge dismissed the Petition in its entirety, concluding that the Petitioner failed to establish by a preponderance of the evidence that the Respondent Condominium Association violated A.R.S. § 33-1242, A.R.S. § 33-1260.01, or the association's CC&Rs.

Why this result: Petitioner failed to establish a violation of any statute or covenant alleged. The core findings supported the HOA's position that the lessee was engaging in prohibited business activity and subletting, and that the charged attorney fees were permissible.

Key Issues & Findings

Alleged violations concerning notice procedures, leasing restrictions, prohibited business use, and excessive fees.

Petitioner alleged Respondent violated A.R.S. § 33-1242 by failing to include proper citations in violation notices, violated A.R.S. § 33-1260.01 and CC&Rs by imposing illegal restrictions on occupancy dates and prohibiting tenant guests, and violated fee limits under A.R.S. § 33-1260.01(E) by charging $250 in attorney fees.

Orders: The Petition was dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

A.R.S. § 33-1242
A.R.S. § 33-1260.01
A.R.S. § 33-1258
A.A.C. R2-19-119
CC&Rs Section 7.21
CC&Rs Section 7.3

Analytics Highlights

Topics: condominium, HOA dispute, leasing restrictions, short-term rental, business use, notice procedure, attorney fees

Additional Citations:

A.R.S. § 33-1242
A.R.S. § 33-1260.01
A.R.S. § 33-1258
A.A.C. R2-19-119
CC&Rs Section 7.21
CC&Rs Section 7.3

Video Overview

Audio Overview

Decision Documents

19F-H1918013-REL Decision – 677039.pdf

Uploaded 2026-04-26T09:47:51 (115.9 KB)

19F-H1918013-REL Decision – 677040.pdf

Uploaded 2026-04-26T09:47:54 (47.9 KB)

19F-H1918013-REL Decision – 677039.pdf

Uploaded 2026-01-23T17:26:46 (115.9 KB)

19F-H1918013-REL Decision – 677040.pdf

Uploaded 2026-01-23T17:26:49 (47.9 KB)

Briefing Document: Lord v. The Boulders at La Reserve Condominium Association

Executive Summary

This document synthesizes the findings and conclusions from the Administrative Law Judge Decision in case number 19F-H1918013-REL, involving Petitioner George E. Lord and Respondent The Boulders at La Reserve Condominium Association. The judge ultimately dismissed all claims brought by the Petitioner, ruling that the Association acted within the bounds of Arizona statutes and its governing documents.

The core of the dispute centered on Mr. Lord’s leasing of three condominium units to an individual, Barrie Shepley, who used the properties to house participants for his commercial fitness training camps. The Association contended this arrangement constituted a prohibited short-term sublease and an improper business use of the units, leading them to suspend amenity access for the occupants.

The judge’s decision affirmed the Association’s position on all counts. Key takeaways include:

• Substance Over Form: The judge concluded that despite the absence of a formal sublease agreement, the nature of the arrangement—specifically a camp pricing structure that varied based on the number of occupants per condo—was effectively a sublet designed to house an “itinerant population,” contrary to the “spirit and purpose” of the community’s rules.

• Business Use Violation: The operation was found to be a business activity that violated the CC&Rs by requiring persons (camp participants) to come to the residential units.

• Procedural Compliance: The Association’s violation notices were deemed compliant with Arizona law. The judge noted that the statute only requires a detailed citation of the violated rule after the owner responds to the initial notice, which the Petitioner failed to do.

• Legality of Fees: A $250 charge levied by the Association’s counsel was determined to be a permissible charge for attorney’s fees related to potential collection, not an illegal penalty for leasing information as the Petitioner alleged.

As a result of these findings, the Petitioner’s request for relief was denied, and the petition was dismissed in its entirety.

I. Case Overview

• Parties:

◦ Petitioner: George E. Lord (unit owner)

◦ Respondent: The Boulders at La Reserve Condominium Association

• Case Number: 19F-H1918013-REL

• Venue: Arizona Office of Administrative Hearings

• Presiding Judge: Tammy L. Eigenheer, Administrative Law Judge

• Hearing Date: November 26, 2018

• Decision Date: December 17, 2018

• Final Disposition: The petition filed by George E. Lord was dismissed.

II. Factual Background and Timeline of Events

1. Lease Agreements: On or about December 4, 2017, Petitioner George Lord, through his management company, leased two units at The Boulders to Barrie Shepley for a term from March 7, 2018, to April 30, 2018. A third unit was subsequently leased to Mr. Shepley on or about January 15, 2018.

2. Commercial Use: Mr. Shepley operated a Canadian fitness business, “Personal Best,” which offered training camps in Tucson. Accommodations at The Boulders were included in the camp packages. The price for a camp varied based on occupancy:

◦ $950.00 each for four campers in a condo

◦ $1075.00 each for three campers in a condo

◦ $1299.00 each for two campers in a condo

3. Occupancy Begins: On March 7, 2018, guests of Mr. Shepley (camp participants) began arriving to occupy the three leased units.

4. Association Intervention: On March 9, 2018, Community Manager Danielle Morris emailed Mr. Lord, stating the Association’s belief that he was in violation of the CC&Rs by allowing subleasing for periods less than the 30-day minimum. Ms. Morris informed him that amenity access cards for the three units were deactivated.

5. Dispute Escalation: Mr. Lord contended that the occupants were merely “guests” of Mr. Shepley, not subletters. Ms. Morris countered that the Association required the names of all occupants and the duration of their stays, and that each occupant must stay for a minimum of 30 days.

6. Information Provided: On March 13, 2018, Mr. Lord provided the names of the occupants and their dates of occupancy, requesting that amenities be restored.

7. Violation Reiterated: On March 16, 2018, Ms. Morris stated the violation was ongoing, as occupants staying from March 7 to March 31 did not meet the 30-day minimum stay requirement.

8. Formal Notice of Violation: On March 18, 2018, Mr. Lord received formal Notices of Violations for the three units. The notices stated that amenity access was suspended because the HOA was not provided with the names of adult occupants and their timeframes. The notice warned that a $300 fine could be applied. Mr. Lord did not respond to these notices.

9. Attorney Involvement: On March 22, 2018, Mr. Lord received a letter from the Association’s legal counsel outlining its legal position and noting an amount due of $250 for attorney’s fees already incurred.

10. Lease Cancellation & Financial Loss: On April 2, 2018, Mr. Shepley cancelled the remainder of the leases due to the lack of amenities for his guests. Mr. Lord asserted a resulting financial loss of $6,900 in rental fees for April 2018.

11. Petition Filing: On August 31, 2018, Mr. Lord filed a petition with the Arizona Department of Real Estate, alleging the Association violated state statutes and its own CC&Rs.

III. Petitioner’s Allegations and Arguments

Mr. Lord’s petition was based on three primary allegations against the Association:

• Allegation 1: Defective Violation Notice (A.R.S. § 33-1242): The Petitioner argued that the Notices of Violations were legally deficient because they failed to cite the specific statute or CC&R provision that had allegedly been violated.

• Allegation 2: Unlawful Occupancy Requirements (A.R.S. § 33-1260.01 & CC&Rs): The Petitioner asserted that the Association overstepped its authority by demanding that each occupant, whom he characterized as a “guest” of the primary lessee, must stay for a minimum of 30 days. He argued the 30-day minimum lease term applied only to the primary lease with Mr. Shepley, not to the occupants.

• Allegation 3: Improper Fees (A.R.S. § 33-1260.01(E)): The Petitioner claimed that the $250 charge from the Association’s attorney constituted an illegal fee, penalty, or charge related to providing leasing information, which he argued was prohibited by statute.

IV. Administrative Law Judge’s Findings and Conclusions

The Administrative Law Judge found that the Petitioner failed to meet the burden of proof for any of his allegations and dismissed the petition. The judge’s reasoning is detailed below.

Finding 1: No Violation of A.R.S. § 33-1242 (Violation Notice)

The judge determined that the Association’s initial Notices of Violations were legally sufficient.

• Legal Reasoning: A.R.S. § 33-1242(C) requires an association to cite the specific provision of the condominium documents that has been violated. However, this obligation is only triggered after the unit owner sends a written response to the initial notice by certified mail.

• Factual Basis: The Petitioner admitted that he did not respond to the formal Notices of Violations he received.

• Conclusion: Because the Petitioner did not take the legally required step to trigger the Association’s duty to provide a specific citation, the Association did not violate the statute.

Finding 2: No Violation of A.R.S. § 33-1260.01 or CC&Rs (Leasing Rules)

The judge concluded that the Association was justified in its actions regarding the occupancy of the units.

• The Arrangement was a “Form” of Subletting: The judge ruled against the Petitioner’s argument that the occupants were merely “guests.” The fact that the price of the fitness camp changed based on how many people shared a unit was seen as evidence that Mr. Shepley was, in effect, subletting the units for his business.

• Prohibited Business Activity: The judge found that Mr. Shepley was operating a business from the units in a manner prohibited by Section 7.3 of the CC&Rs, which disallows business activity that “involve[s] persons coming to the Unit.”

• Spirit of the Law: The decision acknowledged that the specific facts of the case “falls between the cracks of the specific language of the statutes and the regulations.” However, the judge emphasized that the Association’s actions were consistent with the broader intent of its rules, stating, “given the totality of the circumstances, the spirit and purpose of the applicable rules is to allow an association to know who is in the community and to prevent an itinerant population.”

• Conclusion: The Petitioner failed to establish that the Association violated leasing statutes or its own CC&Rs.

Finding 3: No Violation of A.R.S. § 33-1260.01(E) (Fees)

The judge found that the $250 charge was not an illegal penalty.

• Nature of the Charge: The evidence showed that no fines for the lease policy violation had actually been assessed. The $250 charge was explicitly for attorney’s fees related to the potential collection of assessments.

• Legal Reasoning: The judge stated, “Nothing in the cited statute or the CC&Rs prohibits such a charge being implemented.” The fee was not a penalty for “incomplete or late information” as covered by the statute, but a charge for legal costs incurred by the Association.

• Conclusion: The Petitioner failed to establish a violation regarding the assessed fees.

V. Referenced Statutes and Governing Documents

Reference

Provision Summary

Relevance to Case

A.R.S. § 33-1242(B)&(C)

Outlines the process for a unit owner to respond to a violation notice and the association’s subsequent duty to provide specific details of the violation.

The judge found no violation because the Petitioner did not follow the procedure to trigger the association’s duty.

A.R.S. § 33-1260.01(C)

Limits the information an association can require about a tenant to names, contact info for adults, lease period, and vehicle information.

The Petitioner’s case rested on interpreting this statute; the judge found the Association’s inquiries justified by the unique circumstances.

A.R.S. § 33-1260.01(E)

Prohibits an association from imposing fees greater than $15 for incomplete or late leasing information.

The Petitioner argued the $250 attorney fee violated this, but the judge found it was a permissible charge for legal costs, not a penalty.

CC&R Section 7.21

Requires leases to be in writing, for a term of not less than 30 days, and requires owners to provide lessee names and lease dates.

The Association argued the arrangement violated the 30-day minimum stay rule for occupants, which the judge upheld in spirit.

CC&R Section 7.3

Prohibits business activities within a unit that involve persons coming to the unit.

The judge found Mr. Shepley’s fitness camp, which housed participants in the units, was a clear violation of this provision.

Leasing Policy

States a $300 fine may be imposed for violations of the 30-day minimum lease policy.

The Notice of Violation referenced this potential fine, though it was never actually assessed.

VI. Final Order and Procedural Notes

• Order: Based on the above findings, the Administrative Law Judge ordered that the Petition be dismissed.

• Binding Nature: The decision is binding on the parties unless a rehearing is granted. A request for rehearing must be filed with the Commissioner of the Department of Real Estate within 30 days of the service of the Order.

• Related Filings: On the same day the decision was issued, December 17, 2018, the court also issued a separate “Order Vacating Hearing,” likely a procedural filing to cancel a future hearing that was rendered unnecessary by the dismissal of the case.

Study Guide: Lord v. The Boulders at La Reserve Condominium Association

This study guide provides a detailed review of the administrative case No. 19F-H1918013-REL, heard by the Arizona Office of Administrative Hearings. The case involves a dispute between a condominium unit owner, George E. Lord, and his condominium association, The Boulders at La Reserve, concerning leasing policies, occupant regulations, and alleged statutory violations.

Short-Answer Quiz

Instructions: Answer the following questions in two to three complete sentences, based on the information provided in the source documents.

1. Who were the primary parties involved in this administrative hearing, and what were their respective roles?

2. Describe the business arrangement that Barrie Shepley, the petitioner’s lessee, was operating from the leased condominium units.

3. What was the first official action the Condominium Association’s management took in response to the arrival of Barrie Shepley’s guests, and what was their stated reason?

4. According to the Association, what two specific provisions of the governing documents were being violated by the petitioner and his lessee?

5. What was the petitioner’s central argument for why the occupants of the units were not in violation of the Association’s 30-day minimum stay requirement?

6. On what procedural grounds did the petitioner, George Lord, claim that the Association’s “Notice of Violations” was itself a violation of Arizona law (A.R.S. § 33-1242)?

7. Why did the Administrative Law Judge ultimately rule that the Association did not violate A.R.S. § 33-1242?

8. How did the judge interpret the fact that the price for Barrie Shepley’s fitness camps varied based on the number of people sharing a condo?

9. What financial loss did the petitioner claim to have suffered, and what was the direct cause of this loss?

10. What was the final ruling, or “Order,” issued by the Administrative Law Judge in this case?

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Answer Key

1. The primary parties were George E. Lord, the petitioner and owner of multiple condominium units, and The Boulders at La Reserve Condominium Association, the respondent and governing body for the community. The case was adjudicated by Administrative Law Judge Tammy L. Eigenheer.

2. Barrie Shepley operated a fitness business called “Personal Best” that offered training camps in the Tucson area. The price for these camps included accommodations at The Boulders, with the cost per person varying based on how many campers shared a condominium unit.

3. The Association’s first action was to deactivate the amenity access cards for the three units leased by Shepley. Danielle Morris, the Community Manager, stated this was due to a belief that the petitioner’s lessee was subleasing the units for periods of less than the 30-day minimum in violation of the CC&Rs.

4. The Association alleged violations of the CC&Rs related to subleasing for less than the 30-day minimum timeframe. The formal Notices of Violations also cited the failure to provide the names of all adult occupants and the timeframes of their stays to the HOA.

5. The petitioner argued that because his lessee, Mr. Shepley, was not charging a specific rental fee to the occupants, they were merely “guests” and not sub-lessees. Therefore, the 30-day minimum stay requirement applicable to leases did not apply to them.

6. The petitioner alleged that the Association’s failure to include a citation to the specific statute or CC&R provision that had allegedly been violated in the initial Notice of Violations was a violation of A.R.S. § 33-1242.

7. The judge ruled against the petitioner because A.R.S. § 33-1242 only requires an association to provide the specific provision violated after the unit owner sends a written response to the initial notice by certified mail. The petitioner admitted that he did not respond to the Notices of Violations.

8. The judge found that the tiered pricing structure supported the conclusion that Mr. Shepley was, “in a form, subletting the units.” The fact that the camp price decreased as more people shared a unit indicated that the occupants were paying for their accommodations, not simply staying as guests.

9. The petitioner asserted a financial loss of $6,900 in rental fees for April 2018. This loss was directly caused by Barrie Shepley canceling the remainder of his leases due to the lack of amenities for his occupants.

10. The Administrative Law Judge’s final order was that the Petition filed by George E. Lord be dismissed. This decision was binding unless a rehearing was granted.

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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 to each prompt, citing specific facts, arguments, and legal interpretations from the case file.

1. Analyze the Administrative Law Judge’s reasoning for concluding that Barrie Shepley was “in a form, subletting” the units. Discuss the evidence cited and the concept of the “spirit and purpose” of the rules versus their literal interpretation.

2. Examine the procedural misstep made by the petitioner, George Lord, after receiving the Notices of Violations. How did this action directly impact the judge’s ruling on his claim regarding A.R.S. § 33-1242?

3. Discuss the conflict between a unit owner’s right to lease their property and a condominium association’s right to enforce its governing documents, using the specific provisions of the CC&Rs (Sections 7.21 and 7.3) and state law (A.R.S. § 33-1260.01) as examples from the case.

4. Explain the distinction the judge made between the $300 potential fine mentioned in the Notice of Violations and the $250 attorney’s fee charged to the petitioner. How did this distinction relate to A.R.S. § 33-1260.01(E), and why was the Association’s action deemed permissible?

5. Evaluate the concept of an “itinerant population” as mentioned by the judge. How did Barrie Shepley’s business model contribute to this concern for the Association, and how did it ultimately weigh into the judge’s decision to dismiss the petition?

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Glossary of Key Terms

Term / Name

Definition

Administrative Law Judge (ALJ)

An official who presides over administrative hearings, weighs evidence, and makes legal rulings on disputes involving government agencies. In this case, Tammy L. Eigenheer.

A.R.S. (Arizona Revised Statutes)

The codified body of laws for the state of Arizona. The petitioner alleged violations of specific statutes within this code, namely A.R.S. § 33-1242 and § 33-1260.01.

A.R.S. § 33-1242

A state law governing the process for notifying a unit owner of a violation of condominium documents and the procedures for the owner to respond and contest the notice.

A.R.S. § 33-1260.01

A state law that places limitations on what information an association can require from a unit owner regarding a tenant and caps certain fees or penalties for incomplete information at $15.

Amenity

A feature or facility of a property that provides comfort, convenience, or pleasure. In this case, access to amenities was controlled by key cards, which the Association deactivated.

Barrie Shepley

The individual who leased three condominium units from the petitioner. He operated a fitness business, “Personal Best,” and used the units to house clients attending his training camps.

Covenants, Conditions, and Restrictions. These are the governing legal documents that set out the rules for a planned community or condominium. The Association alleged Shepley’s use of the units violated Sections 7.21 (leasing limitations) and 7.3 (business use limitations).

George E. Lord

The Petitioner in the case. He was the owner of multiple condominium units at The Boulders at La Reserve and filed the petition against the Association.

Itinerant population

A term used by the judge to describe a population of short-term, transient occupants. The judge concluded that the purpose of the Association’s rules was, in part, to prevent this type of occupancy.

Notice of Violations

A formal written document sent by the Association to the petitioner informing him of alleged violations of the governing documents and outlining potential consequences, such as fines.

Petitioner

The party who files a petition initiating a legal or administrative action. In this case, George E. Lord.

Preponderance of the evidence

The standard of proof required in this administrative hearing. It means that the petitioner had the burden of showing that the facts they sought to prove were “more probable than not.”

Respondent

The party against whom a petition is filed. In this case, The Boulders at La Reserve Condominium Association.

Subletting

The practice of a tenant leasing a rented property to a third party. The Association contended Shepley was subletting the units to his campers, while the petitioner argued they were merely guests.

The Boulders at La Reserve Condominium Association

The Respondent in the case. The homeowners’ association (HOA) responsible for governing the condominium community in Oro Valley, Arizona.

The $6,900 ‘Guest’ Mistake: 3 Hard Lessons from an HOA Lawsuit

A $6,900 loss in rental income and a losing legal battle with his HOA—all because of a dispute over the definition of a “guest.” This case between owner George Lord and The Boulders at La Reserve Condominium Association is a masterclass in how quickly and completely an owner can lose when they misinterpret the rules and underestimate an association’s power.

For any homeowner or landlord, this dispute provides three crucial lessons distilled from the administrative court’s decision. Understanding these precedents is essential before you ever find yourself at odds with your own HOA.

Lesson 1: The “Spirit of the Rule” Can Outweigh Your Clever Workaround

The dispute began when the property owner, Mr. Lord, leased three condos to Barrie Shepley, who ran fitness training camps. Mr. Shepley then used the condos to house his camp attendees, often for periods shorter than the HOA’s 30-day minimum lease term.

The owner argued his arrangement complied with the rules. He claimed his tenant, Mr. Shepley, was not subleasing the units; the attendees were merely “guests,” and therefore not subject to the 30-day minimum. It was a clever workaround, but it fell apart under scrutiny for two distinct reasons.

First, the judge looked past the “guest” label to the financial substance of the arrangement. A key piece of evidence was the camp’s pricing: the cost changed based on how many campers shared a condo ($950 each for four campers vs. $1299 each for two). The judge saw this as clear proof that housing was being paid for, making it a form of subletting.

Second, the judge found that the arrangement constituted a prohibited business activity. The association’s CC&Rs (Section 7.3) explicitly forbade any business activity that “involve[s] persons coming to the Unit.” Since the fitness camp required attendees to come to the condos for lodging, it was a direct violation. The judge’s decision was therefore not just based on a subjective interpretation, but was also grounded in a concrete rule violation.

The court looked at the “totality of the circumstances” to make its ruling, a point powerfully summarized in the final decision:

However, given the totality of the circumstances, the spirit and purpose of the applicable rules is to allow an association to know who is in the community and to prevent an itinerant population.

Pro Tip: Before implementing a workaround, ask yourself: “Does this honor the community’s stated goal?” If the answer is no, you’re on thin ice, even if you think you’ve found a loophole.

Lesson 2: You Must Follow Procedure to the Letter, Or You Forfeit Your Rights

Confident in his “guest” interpretation, the homeowner made his next critical error by underestimating the importance of legal procedure. He argued that the HOA’s initial “Notice of Violations” was invalid because it failed to cite the specific CC&R provision that had allegedly been violated.

This argument was swiftly dismissed due to a simple but fatal mistake: the owner never sent a formal written response to the notice by certified mail.

Under Arizona law (A.R.S. § 33-1242), an owner’s formal written response via certified mail triggers the HOA’s obligation to provide the specific provision that was violated. Without that trigger, the HOA’s duty to explain further is never activated. The homeowner failed to pull the trigger. Because he did not follow this exact procedure, his claim was thrown out, and the HOA had no further legal obligation to detail its case.

Analyst’s Takeaway: In a legal dispute, communication that isn’t sent via the officially mandated channel (like certified mail) is legally equivalent to communication that never happened.

Lesson 3: The HOA’s Legal Fees Can Hit Your Wallet Sooner Than You Think

Early in the dispute, the owner received a letter from the HOA’s legal counsel. The letter outlined the association’s position and included a charge for $250.00. This was not a fine for the violation. It was a fee for the lawyer’s time, as explained in the letter:

“As you know, the Association is entitled to recover its costs and attorneys’ fees from you, including $250.00 already incurred for the preparation of this letter.”

Many governing documents contain clauses that allow an HOA to recover its “costs of enforcement.” This letter was an enforcement action, and the legal fee was the cost. The judge found that nothing in the law or CC&Rs prohibited the HOA from immediately passing this expense to the owner.

This initial charge was a precursor to a much larger financial blow. As an enforcement tool for the violations discussed in Lesson 1, the HOA suspended the tenants’ access to community amenities. This pressure tactic worked perfectly. The tenant, Mr. Shepley, cancelled his leases due to the lack of amenity access, leading to the owner’s stated loss of $6,900 in rental fees.

Pro Tip: Assume your HOA’s first legal letter starts a running tab. Budget for legal costs from day one of a formal dispute, not just for potential fines.

Conclusion: Knowledge is Your Best Defense

The case of Lord vs. The Boulders at La Reserve establishes three clear precedents for owners: a rule’s intent can supersede its literal interpretation, procedural shortcuts void your rights, and the financial clock starts ticking the moment an HOA retains counsel.

This case is a firm reminder of an HOA’s power to enforce its rules, but it also highlights the owner’s responsibility to understand them. It begs the question: In our own communities, are we fully aware of the rules we’ve agreed to live by?

Case Participants

Petitioner Side

George E. Lord (petitioner)

Respondent Side

Maria Kupillas (respondent attorney)
Law offices of Farley, Choate & Bergin
Danielle Morris (community manager)
The Boulders at La Reserve Condominium Association

Neutral Parties

Tammy L. Eigenheer (ALJ)
Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
LDettorre (ADRE staff)
Arizona Department of Real Estate
AHansen (ADRE staff)
Arizona Department of Real Estate
djones (ADRE staff)
Arizona Department of Real Estate
DGardner (ADRE staff)
Arizona Department of Real Estate
ncano (ADRE staff)
Arizona Department of Real Estate

Other Participants

Barrie Shepley (renter/key individual)

John W. Gray vs. Mesa Coronado III Condominium Association

Posted on November 30, 2018 by [email protected]

Case Summary

Case ID	19F-H1918004-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-11-30
Administrative Law Judge	Kay Abramsohn
Outcome	The Petitioner was deemed the prevailing party regarding the Respondent's violations of the CC&Rs and rules concerning parking enforcement. The Respondent was ordered to refund the Petitioner's $500.00 filing fee.
Filing Fees Refunded	$500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	John W. Gray	Counsel	—
Respondent	Mesa Coronado III Condominium Association	Counsel	Austin Baillio, Esq.

Alleged Violations

A.R.S. § 33-1258

Outcome Summary

The Petitioner was deemed the prevailing party regarding the Respondent's violations of the CC&Rs and rules concerning parking enforcement. The Respondent was ordered to refund the Petitioner's $500.00 filing fee.

Key Issues & Findings

Failure to enforce parking rules (vehicle limits, garage use, inoperable vehicles)

Petitioner alleged that the HOA refused to enforce parking rules regarding vehicle limits, requiring use of garages for first cars, and banning inoperable or commercial vehicles, despite written complaints. The ALJ found the HOA failed to enforce these rules or issue proper notices/fines.

Orders: MCIII ordered to pay Petitioner his filing fee of $500.00 within thirty days of the Order.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

A.R.S. § 33-1258
MCIII Rules and Regulations #2 and #3
MCIII CC&Rs 4.12
MCIII CC&Rs 4.13
MCIII CC&Rs 4.14

Analytics Highlights

Topics: HOA Enforcement, Parking Rules, Filing Fee Refund, Inoperable Vehicle, CC&R Violation

Additional Citations:

A.R.S. § 33-1258
A.R.S. § 32-2199(1)
A.A.C. R2-19-119(A)
A.A.C. R2-19-119(B)(1)
A.A.C. R2-19-119(B)(2)
A.R.S. §32-2199.02(B)
A.R.S. § 32-2199.04
A.R.S. § 41-1092.09

Video Overview

Audio Overview

Decision Documents

19F-H1918004-REL Decision – 674057.pdf

Uploaded 2026-04-24T11:15:17 (139.6 KB)

19F-H1918004-REL Decision – 674057.pdf

Uploaded 2026-01-23T17:25:52 (139.6 KB)

Briefing Document: Gray v. Mesa Coronado III Condominium Association (Case No. 19F-H1918004-REL)

Executive Summary

This document provides a comprehensive analysis of the Administrative Law Judge Decision in the case of John W. Gray (Petitioner) versus the Mesa Coronado III Condominium Association (MCIII, Respondent). The central issue was MCIII’s failure to enforce its own Covenants, Conditions, and Restrictions (CC&Rs) and community rules regarding vehicle parking.

The Petitioner, Mr. Gray, presented credible and convincing evidence of widespread, ongoing parking violations by multiple residents, including exceeding vehicle limits, failing to use garages for primary parking, and the long-term storage of an inoperable vehicle in a common area parking space. The Respondent, MCIII, argued that the rules were difficult to enforce and that it had taken some action, including revising the rules shortly before the hearing.

The Administrative Law Judge (ALJ) ultimately rejected MCIII’s defense, concluding that the association had demonstrably failed to enforce its governing documents. The ALJ found that MCIII had viable enforcement options, such as issuing notices and fines, which it did not utilize. The final order deemed the Petitioner the prevailing party and required MCIII to reimburse his $500 filing fee.

Case Overview

• Parties Involved:

◦ Petitioner: John W. Gray, owner of Unit 122 in the Mesa Coronado III Condominium development.

◦ Respondent: Mesa Coronado III Condominium Association (MCIII), the unit owners’ association for the 33-unit development.

• Adjudicating Body: The Office of Administrative Hearings, following a referral from the Arizona Department of Real Estate.

• Hearing Date: October 29, 2018.

• Decision Date: November 30, 2018.

• Core Allegation: The Petitioner alleged that MCIII violated its own Rules, Regulations, and CC&Rs (specifically Articles 4.12, 4.13, and 4.14) by refusing to enforce parking rules despite receiving written complaints.

Background and Timeline of the Dispute

The conflict centered on parking within the MCIII development, which has 36 parking spaces for 33 units, with spaces being “open” and not assigned to specific units (with one exception).

• Pre-existing Rules (Adopted Jan. 2002):

◦ Owners were limited to two cars per unit.

◦ The garage was considered the “assigned” parking for the first car.

◦ Inoperable vehicles were banned from the property.

◦ A system of warnings and fines was in place for rule violations.

• May 17, 2018: Petitioner Gray submitted a formal written complaint to MCIII, identifying at least eight units in violation of parking rules. His complaint specified:

◦ Units with three cars were not using their garages for parking, instead using them for storage.

◦ An inoperable red truck had been stationary in the same parking spot for over a year.

◦ A commercial truck was present containing what he believed to be hazardous pool chemicals.

• MCIII’s Initial Response: The association acknowledged a “history” with the parking situation and stated the Board would review the rules for revision. MCIII noted it would investigate the red truck and also accused the Petitioner of regularly parking his own truck in a fire lane.

• July 16, 2018: The Petitioner sent a follow-up notification regarding the continuing violations.

• MCIII’s Second Response: The association informed the Petitioner that the issue would be on the agenda for the July 24, 2018 Board meeting and again reminded him of his own alleged fire lane parking violations.

• July 23, 2018: MCIII sent a notice to the owner of the unit associated with the inoperable red truck, informing them of the rules violation.

• July 30, 2018: The Petitioner filed his formal petition with the Arizona Department of Real Estate.

• October 23, 2018: Days before the hearing, the MCIII Board adopted new parking rules.

Petitioner’s Case and Evidence (John W. Gray)

The Petitioner built a detailed case demonstrating a pattern of non-enforcement by MCIII. The ALJ found his evidence to be “credible and convincing.”

• Specific Violations Alleged:

◦ Excess Vehicles: Multiple units possessed more than the two-vehicle limit.

◦ Garage Misuse: Residents with multiple cars were using common area parking spaces while their garages were used for storage.

◦ Inoperable Vehicle: A red truck remained parked and inoperable in one space for over a year, in direct violation of CC&R 4.14.

• Evidence Presented at Hearing:

◦ Photographs: A series of exhibits (6 through 16) contained photographs documenting the various offending vehicles.

◦ Private Investigation: The Petitioner hired a private investigator to obtain vehicle registration information to link specific vehicles to their owners and units (Exhibit 17).

◦ Quantitative Analysis: The Petitioner calculated that just 12 units were occupying 27 common area parking spaces, leaving very few spaces for the remaining 21 units.

◦ Written Correspondence: Copies of his complaints to MCIII were submitted, demonstrating that the association was put on notice of the violations.

Respondent’s Defense and Actions (MCIII)

The association’s defense centered on the difficulty of enforcement and subsequent actions taken after the Petitioner’s complaint.

• Core Arguments:

◦ Unenforceability: MCIII asserted that it was “almost impossible” to enforce the existing restrictive rules, as it would require constant 24/7 monitoring.

◦ Lack of Prior Complaints: The Respondent claimed it had received no complaints about parking prior to Mr. Gray’s.

◦ Issue is Moot: MCIII argued that its recent revision of the parking rules rendered the Petitioner’s complaint moot.

• Actions Taken by MCIII:

◦ Rule Revision: At the October 23, 2018 Board meeting, MCIII adopted new rules that eliminated the two-car limit but maintained the requirement for residents to use their garage first before occupying common area spaces. The ban on inoperable and commercial vehicles was also kept.

◦ Enforcement Against Petitioner: The Respondent noted that it had previously taken enforcement action by having the Petitioner’s own truck towed for parking in a fire lane.

◦ Notice Regarding Red Truck: MCIII provided evidence that it sent one letter on July 23, 2018, regarding the inoperable red truck.

◦ Towing Contract: The association stated it had recently contracted with Shaffer Towing for towing services.

◦ Community Manager Patrols: The “Community Manager,” Andrea Lacombe, testified that she drove through the property approximately twice a month looking for violations.

Governing Rules and CC&Rs

The decision rested on the specific language of the association’s governing documents in effect at the time of the complaint.

Document

Article/Rule

Provision

Rules & Regulations (Jan 2002)

Rule 3

Limits owners to two cars per unit and “assigns” the garage as parking for the first car.

CC&Rs (Jan 1999)

Art. 4.12

Prohibits the parking of commercial vehicles, RVs, boats, trailers, etc., on any part of the condominium outside of an enclosed garage.

CC&Rs (Jan 1999)

Art. 4.13

States that no parking space may be used for storage or any purpose other than parking of Family Vehicles. Grants the Board the right to assign spaces.

CC&Rs (Jan 1999)

Art. 4.14

Prohibits the storage of inoperable vehicles on any portion of the condominium other than within enclosed garages. Grants the Board the right to have violating vehicles towed.

Administrative Law Judge’s Decision and Rationale

The ALJ sided with the Petitioner, finding that MCIII had failed in its duty to enforce its own rules.

• Rejection of MCIII’s Defense: The ALJ determined that MCIII’s argument that the rules were unenforceable was “not a viable defense.” The decision explicitly stated that the association could have used provisions for notification and fines to enforce the rules but failed to do so.

• Evidence of Non-Enforcement: The hearing record demonstrated a clear failure by MCIII to act.

◦ The evidence was “undisputed” that the inoperable red truck had been in violation for over a year, yet MCIII only sent a single notice long after the complaint was filed.

◦ The ALJ noted that clearing even that one space would have improved the “tenuous parking situation.”

◦ The record contained no indication that MCIII had ever enforced the rules regarding the number of vehicles or the mandatory use of garages for primary parking.

◦ The only enforcement action cited, other than the single letter, was the towing of the Petitioner’s own vehicle.

• Conclusion of Law: Based on the evidence, the ALJ concluded that “MCIII failed to enforce CC&Rs and rules and regulations regarding parking.” The revision of the rules just before the hearing did not negate the past failure to enforce the rules that were in effect at the time of the Petitioner’s complaint.

Final Order

Based on the findings of fact and conclusions of law, the Administrative Law Judge issued a binding order with two key provisions:

1. Prevailing Party: The Petitioner, John W. Gray, is officially deemed the prevailing party in the matter.

2. Reimbursement: MCIII is ordered to pay the Petitioner his filing fee of $500.00 within thirty (30) days of the order.

Study Guide: Gray v. Mesa Coronado III Condominium Association

This guide provides a detailed review of the Administrative Law Judge Decision in case No. 19F-H1918004-REL, concerning a dispute over the enforcement of parking regulations. It includes a short-answer quiz, an answer key, essay questions for deeper analysis, and a glossary of key terms.

Quiz: Short-Answer Questions

Answer each of the following questions in 2-3 complete sentences, based entirely on the provided source document.

1. Who were the primary parties involved in this case, and what were their respective roles?

2. What were the two main issues John W. Gray alleged in his petition filed with the Department on July 30, 2018?

3. According to the MCIII rules in effect at the time of the complaint, what were the primary restrictions placed on vehicle ownership and parking for residents?

4. Describe the key evidence the Petitioner presented at the hearing to substantiate his claims of widespread parking rule violations.

5. What was the Respondent’s primary defense for not enforcing the more restrictive parking rules that were in place at the time of the complaint?

6. How did the new rules, adopted on October 23, 2018, change the association’s approach to vehicle limits and garage use?

7. Explain the significance of the inoperable red truck to the Administrative Law Judge’s final decision.

8. What was the required standard of proof for the Petitioner in this case, and did the judge determine that he met it?

9. Prior to the hearing, what specific enforcement actions did MCIII take in response to the Petitioner’s documented complaints?

10. What was the final order issued by the Administrative Law Judge, and what was MCIII required to do?

Answer Key

1. The primary parties were John W. Gray, the Petitioner, who was a condominium owner in the MCIII development, and the Mesa Coronado III Condominium Association (MCIII), the Respondent and the governing unit owners’ association for the development. Mr. Gray initiated the legal action against the association for allegedly failing to enforce its rules.

2. The Petitioner’s two main allegations were that the association had failed to provide him with a copy of its management company agreement and that it refused to enforce its parking rules. He specifically alleged multiple units were violating rules regarding the number of vehicles and the presence of inoperable vehicles.

3. The rules in effect at the time of the complaint limited owners to a maximum of two cars per unit. The rules also “assigned” the garage as the designated parking spot for the first car and explicitly banned “inoperable” vehicles from the property.

4. The Petitioner presented credible evidence including photographs from multiple exhibits (6-16) showing numerous violations. He also testified based on his personal observations, identified specific units with three cars using garages for storage, and provided vehicle registration information obtained through a private investigator.

5. The Respondent defended its lack of enforcement by arguing that the existing restrictive rules were “almost impossible” to enforce without constant surveillance. The Community Manager also testified that she had received no prior complaints about parking from other residents.

6. The new rules, adopted October 23, 2018, removed the limit on the number of cars permitted per unit. However, they instituted a new requirement that owners must park their vehicles in their respective garages before using any common area parking spaces.

7. The inoperable red truck was significant because it had been parked in the same spot for over a year, serving as undisputed evidence of a long-standing violation. The judge noted that MCIII’s single letter to the owner, sent long after the violation began, demonstrated a clear failure to enforce its rules regarding inoperable vehicles.

8. The required standard of proof was a “preponderance of the evidence,” meaning the Petitioner had to convince the judge that his contentions were more probably true than not. The judge concluded that the Petitioner successfully met this burden of proof.

9. MCIII’s primary enforcement actions were to place the issue on its July 24, 2018, Board meeting agenda and to send one letter on July 23, 2018, to the owner of the unit associated with the inoperable red truck. The record also shows MCIII had previously enforced parking rules against the Petitioner himself by having his truck towed from a fire lane.

10. The judge ordered that the Petitioner be deemed the prevailing party in the case. The judge further ordered that MCIII must pay the Petitioner his filing fee of $500.00 within thirty days of the order.

Essay Questions

The following questions are designed to promote deeper analysis of the case. Formulate comprehensive responses based on the facts and arguments presented in the source document.

1. Analyze the Respondent’s argument that revising the parking rules made the Petitioner’s complaints “moot.” Based on the judge’s decision, evaluate the strength of this defense and explain why it was ultimately unsuccessful.

2. Discuss the concept of a condominium association’s duty to enforce its own rules and CC&Rs, using the specific examples of MCIII’s actions (and inactions) from the case. How did the association’s selective enforcement—such as towing the Petitioner’s vehicle but not others—factor into the case’s context?

3. Evaluate the evidence presented by both the Petitioner and the Respondent. Which party presented a more compelling case, and why? Support your analysis by citing specific exhibits, testimony, and documented observations mentioned in the decision.

4. Explore the timeline of events from the Petitioner’s first complaint in May 2018 to the judge’s decision in November 2018. How does this timeline illustrate the dispute’s escalation and the association’s response strategy?

5. The Administrative Law Judge found that MCIII’s argument of the rules being “unenforceable” was not a viable defense. What practical enforcement actions, short of 24/7 surveillance, could the association have taken according to the information provided in the hearing record?

Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

The official who presides over the evidentiary hearing at the Office of Administrative Hearings and issues a decision. In this case, it was Kay Abramsohn.

Burden of Proof

The legal obligation of a party in a trial to produce evidence that proves the claims they have made against the other party.

Covenants, Conditions, and Restrictions. These are the governing legal documents that set up the guidelines for a planned community like a condominium. MCIII’s CC&Rs were effective January 12, 1999.

Common Elements

Also referred to as the “Common Area,” these are parts of the condominium property, such as the parking lot, available for use by all unit owners.

Community Manager

An employee of the management company (Curtiss Management) hired by the association to handle its affairs. In this case, the manager was Andrea Lacombe.

Evidentiary Hearing

A formal legal proceeding where parties present evidence (exhibits) and testimony to prove their case before a judge or hearing officer.

Inoperable Vehicle

A vehicle that cannot be operated. Both the old and new MCIII rules, as well as CC&R 4.14, prohibited storing such vehicles on the property outside of an enclosed garage.

A term used to describe an issue that is no longer in dispute or of practical significance. MCIII argued that its new rules made the Petitioner’s issues moot.

Petitioner

The party who initiates a legal action or files a petition. In this case, John W. Gray.

A map, drawn to scale, showing the divisions of a piece of land. The plat for MCIII showed there were 36 parking spaces in the lot.

Preponderance of the Evidence

The standard of proof required in this case. It is met if the proposition is more likely to be true than not true; it is a superior evidentiary weight that inclines an impartial mind to one side.

Prevailing Party

The party who is found to have won the legal case. The judge deemed the Petitioner to be the prevailing party.

Respondent

The party against whom a petition is filed; the defending party. In this case, the Mesa Coronado III Condominium Association.

He Fought the HOA Over Parking—and Won. Here Are the 5 Surprising Lessons from His Battle.

Introduction: The Familiar Frustration of HOA Parking

For anyone living in a condo, townhome, or planned community, the daily dance of parking is a familiar routine. It’s a world of limited spaces, confusing rules about guest parking, and the constant fear of a warning sticker or, worse, a tow truck. This shared frustration often simmers just below the surface of community life, where the rules established by a Homeowners Association (HOA) can feel arbitrary and inconsistently applied.

This post breaks down a real-life administrative court case where one resident, John W. Gray, took on his Condominium Association for its complete failure to enforce its own parking rules. Without getting lost in legal jargon, we will explore how a single, determined individual was able to hold his HOA accountable. This wasn’t just a simple disagreement; it was a formal challenge that went before a judge.

The official court decision in Gray’s favor offers powerful and surprising lessons for any homeowner, renter, or board member. This David vs. Goliath story is more than just a victory for one resident; it’s a practical guide filled with takeaways on how to effectively address community disputes and understand the true responsibilities of an HOA.

1. The ‘It’s Too Hard to Enforce’ Excuse Doesn’t Work

The association (MCIII) built its primary defense on the argument that its own parking rules were “almost impossible” to enforce. They claimed that the two-car limit per unit was too restrictive and would require constant, 24/7 monitoring and picture-taking, which was simply not feasible.

The administrative law judge completely rejected this excuse. The core lesson from the ruling is that an HOA cannot simply choose to ignore its governing documents because enforcement is inconvenient. The judge pointed out that the association had simpler tools at its disposal, such as issuing violation notices and levying fines as outlined in their rules, but failed to take even these basic steps.

The judge’s finding offers a powerful reality check for any board that feels overwhelmed by its own regulations:

MCIII’s argument that the rules were unenforceable is not a viable defense in this instance, as the rules contained many provisions that could have been noticed to the units regarding parking rules and their enforcement.

2. Meticulous Data is Your Strongest Weapon

John W. Gray didn’t just complain; he built an airtight case. His methodical approach to proving the association’s failure was a key factor in his success. The court record details the specific actions he took:

• He conducted personal observations and took photographs of the offending vehicles.

• He identified the specific units that had too many cars and were using their garages for storage instead of parking.

• He hired a private investigator to obtain vehicle registration information to definitively link cars to specific units.

The judge found this evidence to be “credible and convincing.” Gray’s detailed documentation painted a clear picture of the problem’s scale. According to his calculations, just 12 of the community’s 33 units were monopolizing 27 parking spaces, leaving very few for the remaining 21 units. This takeaway is clear: a well-documented, fact-based complaint is infinitely more powerful than anecdotal grievances.

3. Changing the Rules Doesn’t Erase Past Failures

In response to Gray’s formal complaint, the HOA Board took a strategic but ultimately unsuccessful step. Just days before the scheduled hearing, the Board reviewed and adopted a new set of parking rules. These new rules conveniently removed the two-car limit that the association had claimed was unenforceable.

The association then argued that this rule change made the petitioner’s original complaint “moot,” or irrelevant. They essentially claimed that since the rule he was complaining about no longer existed, there was no longer a case to be heard.

This strategy failed because the judge ruled on the HOA’s past failure to enforce the rules that were in effect at the time of the complaint. This is a crucial lesson in accountability. An organization cannot escape responsibility for its prior negligence simply by changing the rules at the last minute. The failure to act had already occurred, and the consequences of that failure were the basis of the lawsuit.

4. Ignoring Small Violations Can Create a Major Crisis

Nowhere was the HOA’s failure more obvious than in the case of a single inoperable red truck. The vehicle had been parked in the same spot for over a year, in clear violation of the rules prohibiting the storage of inoperable vehicles on the property.

Despite this long-term, visible violation, the hearing record shows the HOA’s response was both delayed and minimal. They sent only one letter to the unit owner about the truck, and this action was taken “long after” the violation began and only after Gray had formally complained.

The judge’s observation on this single vehicle underscores the wider impact of the board’s inaction:

Even the clearing of just one more space would have made the tenuous parking situation better.

The red truck was a symptom of a much larger disease. The failure to address one obvious, easily-proven violation demonstrated a systemic failure to manage the community’s shared resources, which directly contributed to the parking crisis and the disproportionate use of spaces by a few residents.

5. Enforcement Must Be Fair, Not Just Convenient

Perhaps the most telling detail from the hearing record was the apparent double standard in the HOA’s enforcement actions. The record explicitly mentions only two enforcement actions the association had taken regarding parking:

• Towing the petitioner’s own truck on one occasion for parking in a fire lane.

• Sending a single, very late letter about the red truck that had been parked for over a year.

The hearing record is devastatingly clear on this point. The only enforcement actions the board could point to were punitive or reactive: towing the truck of the very resident demanding action, and sending a single, belated letter about a year-old violation after he had filed a formal complaint. This wasn’t just inconsistent enforcement; it was a textbook case of selective enforcement that targeted the complainant while ignoring the systemic problem.

For an HOA’s authority to be respected and legally defensible, its rules must be applied fairly and consistently to all residents, not just when it is convenient or aimed at a perceived nuisance.

Conclusion: A Win for the Power of One

The judge’s order was a decisive victory for resident rights, affirming that an HOA’s duty to enforce its own rules is not optional. While the association was ordered to repay his $500 filing fee, the real prize was the validation that one resident, armed with credible evidence, can successfully hold a board accountable to the entire community. This case proves that meticulous documentation, persistence, and a refusal to be ignored are the great equalizers in community governance. It makes you wonder: what ‘unenforceable’ rules in your community are just waiting for a champion to demand they be followed?

Case Participants

Petitioner Side

John W. Gray (petitioner)
Appeared on his own behalf

Respondent Side

Austin Baillio (attorney)
Maxwell & Morgan PC
Represented Mesa Coronado III Condominium Association
Andrea Lacombe (community manager)
Curtiss Management
Testified for Respondent

Neutral Parties

Kay Abramsohn (ALJ)
Office of Administrative Hearings
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Felicia Del Sol (administrative staff)
Transmitted decision electronically

Rogelio A. Garcia vs. Villagio at Tempe Homeowners Association

Posted on November 19, 2018 by [email protected]

Case Summary

Case ID	19F-H1918009-REL-RHG
Agency	ADRE
Tribunal	OAH
Decision Date	2019-03-04
Administrative Law Judge	Velva Moses-Thompson
Outcome	loss
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Rogelio A. Garcia	Counsel	—
Respondent	Villagio at Tempe Homeowners Association	Counsel	Nathan Tennyson

Alleged Violations

ARIZ. REV. STAT. § 33-1242

Outcome Summary

The Administrative Law Judge dismissed the petition for rehearing, finding that the Petitioner failed to prove that the Respondent HOA violated A.R.S. § 33-1242. The HOA was not required to provide the statutory details or the notice of the right to petition ADRE because the Petitioner failed to submit a written response by certified mail within 21 days of the violation notices.

Why this result: The Petitioner failed to meet the burden of proof to show the HOA violated A.R.S. § 33-1242. The HOA was not required to provide the information listed in A.R.S. § 33-1242 (C) or the notice of right to petition in (D) because the Petitioner did not submit a written response by certified mail within twenty-one days, which is the triggering requirement for those obligations.

Key Issues & Findings

Alleged violation of statutory requirements for homeowner association violation notices.

Petitioner alleged Respondent violated A.R.S. § 33-1242 requirements regarding violation notices. The ALJ found that Petitioner failed to establish the violation because he did not respond by certified mail within the 21-day statutory period, meaning the HOA was not triggered to fulfill its obligations under § 33-1242(C) and (D).

Orders: Petitioner's petition is dismissed.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

ARIZ. REV. STAT. § 33-1242
ARIZ. REV. STAT. § 32-2199.01
ARIZ. REV. STAT. § 32-2199.02
ARIZ. ADMIN. CODE § R2-19-119

Analytics Highlights

Topics: HOA Notice Violation, A.R.S. 33-1242, Statutory Construction, Homeowner Petition Dismissed

Additional Citations:

ARIZ. REV. STAT. § 33-1242
ARIZ. REV. STAT. § 32-2199.01
ARIZ. REV. STAT. § 32-2199.02
ARIZ. ADMIN. CODE § R2-19-119
Home Builders Association of Central Arizona v. City of Scottsdale, 187 Ariz. 479, 483, 930 P.2d 993, 997(1997)
Canon School Dist. No. 50 v. W.E.S. Constr. Co., 177 Ariz. 526, 529, 869 P.2d 500, 503 (1994)

Video Overview

Audio Overview

Decision Documents

19F-H1918009-REL Decision – 692638.pdf

Uploaded 2026-04-25T09:58:56 (89.4 KB)

19F-H1918009-REL Decision – 671673.pdf

Uploaded 2026-04-25T09:59:03 (85.4 KB)

19F-H1918009-REL Decision – 692638.pdf

Uploaded 2026-04-24T11:15:40 (89.4 KB)

19F-H1918009-REL Decision – 671673.pdf

Uploaded 2026-04-24T11:15:44 (85.4 KB)

Briefing Document: Garcia v. Villagio at Tempe Homeowners Association

Executive Summary

This document synthesizes two Administrative Law Judge Decisions concerning a dispute between homeowner Rogelio A. Garcia (Petitioner) and the Villagio at Tempe Homeowners Association (Respondent). The core of the case is Mr. Garcia’s allegation that the HOA violated Arizona Revised Statute (A.R.S.) § 33-1242 by failing to follow specific procedures after issuing notices for a violation of its short-term rental policy.

The Administrative Law Judge ultimately dismissed Mr. Garcia’s petition in both an initial hearing and a subsequent rehearing. The central finding was that Mr. Garcia failed to meet a critical prerequisite outlined in the statute: he did not respond to the violation notices by certified mail within the 21-day period. This failure meant that the HOA’s corresponding statutory obligations—such as providing the name of the person who observed the violation—were never triggered.

Furthermore, the judge determined that the HOA was not required to inform Mr. Garcia of his right to an administrative hearing because the violation notices themselves included instructions on the HOA’s internal process for contesting the matter. Mr. Garcia’s argument that the HOA’s rapid issuance of fines and subsequent notices prevented him from responding was found to be unsubstantiated by evidence. The decisions underscore a strict interpretation of the statute, placing the initial burden of response on the unit owner.

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I. Case Overview

This matter was adjudicated by the Arizona Office of Administrative Hearings after a petition was filed with the Arizona Department of Real Estate. The case involved an initial hearing and a rehearing requested by the Petitioner.

Entity / Individual

Petitioner

Rogelio A. Garcia

Respondent

Villagio at Tempe Homeowners Association (“Villagio”)

Respondent’s Counsel

Nathan Tennyson, Esq.

Adjudicating Body

Office of Administrative Hearings

Administrative Law Judge

Velva Moses-Thompson

Case Number (Initial)

19F-H1918009-REL

Case Number (Rehearing)

19F-H1918009-REL-RHG

Core Allegation

Violation of A.R.S. § 33-1242 by the Respondent.

II. Chronology of Events

• March 8, 2018: Villagio mails the first letter to Mr. Garcia, alleging a violation of short-term lease provisions in the community’s Covenants, Conditions, and Restrictions (CC&Rs). The letter instructs him to file an appeal with the Board of Directors within 10 days of receipt.

• March 22, 2018: Villagio mails a second notice for the same violation, informing Mr. Garcia that a $1,000 fine has been posted to his account. This notice also contains instructions for contesting the violation.

• April 5, 2018: Villagio mails a third notice, informing Mr. Garcia that a $2,000 fine has been posted to his account for the continuing violation.

• Response from Garcia: Mr. Garcia did not respond to any of the three notices within the 21-calendar-day period specified by statute. He did, at some point, file an appeal directly with Villagio, which held a hearing but did not change its position.

• August 17, 2018 (approx.): Mr. Garcia files a petition with the Arizona Department of Real Estate, formally initiating the administrative hearing process.

• October 30, 2018: The first evidentiary hearing is held before Administrative Law Judge Velva Moses-Thompson.

• November 19, 2018: The initial Administrative Law Judge Decision is issued, dismissing Mr. Garcia’s petition.

• January 3, 2019 (approx.): The Arizona Department of Real Estate issues an order setting a rehearing for the matter, following a request from Mr. Garcia.

• February 12, 2019: The rehearing is held. Mr. Garcia testifies on his own behalf, and Villagio presents testimony from Community Manager Tom Gordon.

• March 4, 2019: The final Administrative Law Judge Decision is issued, again dismissing Mr. Garcia’s petition.

III. Central Legal Issue: Interpretation of A.R.S. § 33-1242

The entire dispute centered on the procedural requirements laid out in A.R.S. § 33-1242, which governs how an HOA must handle notices of violation to a unit owner. The key provisions are:

• Unit Owner’s Responsibility (Subsection B): A unit owner who receives a written notice of violation may provide the association with a written response. This response must be sent by certified mail within twenty-one calendar days after the date of the notice.

• Association’s Obligations upon Response (Subsection C): Within ten business days after receiving the certified mail response, the association must provide a written explanation that includes:

1. The specific provision of the condominium documents allegedly violated.

2. The date the violation occurred or was observed.

3. The first and last name of the person(s) who observed the violation.

4. The process the unit owner must follow to contest the notice.

• Association’s Obligation Regarding Administrative Hearings (Subsection D): An association must provide written notice of the owner’s option to petition for an administrative hearing with the state real estate department unless the information required in Subsection C, paragraph 4 (the contest process) is provided in the initial notice of violation.

IV. Analysis of Arguments and Evidence

Petitioner’s Position (Rogelio A. Garcia)

Mr. Garcia’s arguments, presented across both hearings, focused on three primary claims of statutory violation by Villagio:

1. Failure to Provide Required Information: Villagio violated the statute by not providing him with the first and last name of the person who observed the violation.

2. Failure to Notify of Hearing Rights: Villagio did not inform him of his right to petition for an administrative hearing with the state real estate department.

3. Prevention of Response: Mr. Garcia contended that Villagio effectively prevented him from responding via certified mail within the 21-day statutory period. He argued that the notices’ demand for compliance within 10 days, combined with the issuance of a second notice and a fine just 14 days after the first, led him to believe he only had 10 days to act before incurring another violation.

Respondent’s Position (Villagio at Tempe HOA)

Villagio presented a defense based on a direct reading of the statute and Mr. Garcia’s inaction:

1. Statutory Obligations Not Triggered: Villagio’s central argument was that its obligations under A.R.S. § 33-1242(C)—including the duty to name the observer—are only triggered after a unit owner submits a written response by certified mail within 21 days. Since Mr. Garcia never sent such a response, these obligations never came into effect.

2. Internal Contest Process Satisfied Statute: Per A.R.S. § 33-1242(D), the duty to notify an owner of their right to an administrative hearing only applies if the HOA fails to provide its own contest process. Villagio argued that because all three notices explicitly stated the process for appealing to the Board of Directors, it had fulfilled its statutory duty.

3. No Prevention of Response: Mr. Garcia was never legally or physically prevented from sending a certified letter. During cross-examination, he admitted he was not under any court order prohibiting him from responding.

4. Statute Inapplicability (Argument from Rehearing): Villagio further contended that A.R.S. § 33-1242 applies specifically to violations concerning the “condition of the property,” not the “use” of the property. Since short-term renting is a use, Villagio argued the statute did not apply to this situation at all.

Key Testimony from Rehearing

During the February 12, 2019 rehearing, Villagio’s Community Manager, Tom Gordon, testified.

• On direct examination, Mr. Gordon stated that Villagio does not restrict homeowners from responding to violation notices within the 21-day period.

• On cross-examination, when asked by Mr. Garcia if Villagio would have abided by “this statute” had he responded in 21 days, Mr. Gordon replied, “No.” He explained this by stating that homeowners are given 10 days to contest a notice with Villagio pursuant to its own short-term rental policy.

V. Administrative Law Judge’s Decisions and Rationale

The judge’s findings were consistent across both the initial decision and the rehearing decision, leading to the same conclusion in each instance.

Initial Decision (November 19, 2018)

• Finding of Fact: It was undisputed that Mr. Garcia did not respond to the March 8, March 22, or April 5, 2018 notices within 21 calendar days.

• Conclusion 1: Because Mr. Garcia did not respond within the 21-day period, Villagio was not required to provide him with the first and last name of the person(s) who observed the violation.

• Conclusion 2: Because Villagio notified Mr. Garcia of the process for contesting the notice, it was not required under A.R.S. § 33-1242(D) to provide him with notice of the right to petition for an administrative hearing.

• Outcome: Mr. Garcia failed to establish by a preponderance of the evidence that a violation occurred. The petition was dismissed.

Rehearing Decision (March 4, 2019)

The judge reaffirmed the initial findings and addressed Mr. Garcia’s argument that he was prevented from responding.

• Finding on “Prevention”: The judge found no evidence that Villagio informed Mr. Garcia he could not respond within 21 days or otherwise prevented him from doing so. The issuance of a second notice 14 days after the first was not deemed a preventative act that nullified Mr. Garcia’s statutory window to respond to the first notice.

• Statutory Construction: The decision invoked the legal principle that “what the Legislature means, it will say,” indicating a strict, literal interpretation of the statute’s requirements.

• Reaffirmed Conclusions: The judge again concluded that because Mr. Garcia failed to submit a written response by certified mail, Villagio’s obligations under A.R.S. § 33-1242(C) were not triggered, and its inclusion of an internal appeal process satisfied the requirements of A.R.S. § 33-1242(D).

• Outcome: Mr. Garcia’s petition was dismissed for a second time, with Villagio deemed the prevailing party.

VI. Final Disposition

The Administrative Law Judge ordered that Mr. Garcia’s petition be dismissed. The decision issued after the rehearing on March 4, 2019, is binding on the parties. Any party wishing to appeal the order must seek judicial review with the superior court within thirty-five days from the date the order was served.

Study Guide: Garcia v. Villagio at Tempe Homeowners Association

This guide is designed to review the key facts, legal arguments, and outcomes of the administrative case between Rogelio A. Garcia and the Villagio at Tempe Homeowners Association, as detailed in case number 19F-H1918009-REL.

Quiz: Short-Answer Questions

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

1. Who were the primary parties involved in this case, and what were their respective roles?

2. What specific violation did the Villagio at Tempe Homeowners Association initially accuse Mr. Garcia of committing?

3. What was the core of Mr. Garcia’s legal complaint against the Homeowners Association?

4. According to the court’s findings, what crucial step did Mr. Garcia fail to take after receiving the violation notices?

5. What was Villagio’s main argument for why it was not obligated to provide Mr. Garcia with the name of the person who observed the violation?

6. Under what circumstance did Villagio argue it was not required to provide Mr. Garcia with notice of his right to petition for an administrative hearing?

7. What new fines were imposed on Mr. Garcia in the notices dated March 22, 2018, and April 5, 2018?

8. At the rehearing, what was Mr. Garcia’s explanation for why he was unable to respond to the notices within the statutory 21-day period?

9. What argument did Villagio introduce at the rehearing concerning the distinction between a property’s “condition” and its “use”?

10. What was the final outcome of both the initial hearing and the subsequent rehearing?

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Answer Key

1. The primary parties were Rogelio A. Garcia, the Petitioner who brought the complaint, and the Villagio at Tempe Homeowners Association, the Respondent defending against the complaint. The case was heard by Administrative Law Judge Velva Moses-Thompson.

2. Villagio accused Mr. Garcia of violating the short-term lease provisions located in the association’s Covenants, Conditions, and Restrictions (CC&Rs). The association alleged that Mr. Garcia’s unit was being rented in violation of its short-term rental policy.

3. Mr. Garcia alleged that Villagio violated ARIZ. REV. STAT. § 33-1242. He claimed Villagio failed to provide him the opportunity to respond by certified mail within 21 days, did not inform him of his right to an administrative hearing, and did not provide the name of the person who observed the violation.

4. The court found that Mr. Garcia did not respond to the violation notices sent on March 8, March 22, and April 5, 2018. Specifically, he failed to provide the association with a written response by sending it via certified mail within 21 calendar days after the date of the notices.

5. Villagio argued that its obligation to provide the observer’s name under A.R.S. § 33-1242(C) is only triggered if the unit owner first submits a written response by certified mail within the 21-day period. Because Mr. Garcia did not do so, Villagio was not required to provide that information.

6. Villagio argued it was not required to provide notice of the right to petition for a hearing because it had already fulfilled its legal obligation under A.R.S. § 33-1242(D). The violation notices it sent to Mr. Garcia contained instructions on the process for contesting the notice with the Board of Directors.

7. The notice dated March 22, 2018, informed Mr. Garcia that a fine of $1,000 had been posted to his account. The subsequent notice on April 5, 2018, stated that an additional $2,000 fine had been posted for the same violation.

8. Mr. Garcia contended that Villagio prevented him from responding because it did not wait 21 days before issuing subsequent notices and fines. He believed he only had 10 days to comply based on language in the notices, which created confusion and pressure.

9. At the rehearing, Villagio argued that A.R.S. § 33-1242 did not apply because the statute addresses violations related to the “condition of the property.” Villagio asserted its notices concerned the “use” of Mr. Garcia’s property (short-term renting), not its physical condition.

10. In both the initial hearing decision issued on November 19, 2018, and the rehearing decision issued on March 4, 2019, the Administrative Law Judge found that Mr. Garcia failed to prove Villagio had violated the statute. Consequently, Mr. Garcia’s petition was dismissed in both instances.

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Essay Questions

Instructions: The following questions are designed to provoke deeper analysis of the case. Formulate a comprehensive response to each, drawing evidence and reasoning exclusively from the case documents.

1. Analyze the legal reasoning used by Administrative Law Judge Velva Moses-Thompson to dismiss Mr. Garcia’s petition. How did the judge interpret and apply the specific subsections of ARIZ. REV. STAT. § 33-1242 to the facts presented in the initial hearing and the rehearing?

2. Trace the progression of arguments made by both Rogelio A. Garcia and Villagio from the initial petition through the rehearing. How did their claims and defenses evolve, and what new evidence or legal theories were introduced in the second hearing?

3. Discuss the significance of the “burden of proof” in this case, which rested upon Mr. Garcia. Explain the standard of a “preponderance of the evidence” as defined in the legal decision and detail why the judge concluded Mr. Garcia failed to meet this standard.

4. Evaluate the strength and potential implications of Villagio’s argument, introduced at the rehearing, that A.R.S. § 33-1242 applies only to the “condition” of a property and not its “use.” Although the judge did not base the final decision on this point, discuss how this interpretation could affect future disputes between homeowners and associations.

5. Based on the dates and actions described in the two decisions, construct a detailed procedural timeline of this case. Begin with the first violation letter from Villagio and conclude with the notice of the right to appeal the rehearing decision, including all key notices, filings, hearings, and fines.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official who presides over administrative hearings, makes findings of fact and conclusions of law, and issues decisions. In this case, the ALJ was Velva Moses-Thompson.

ARIZ. REV. STAT. (A.R.S.)

The Arizona Revised Statutes, which are the codified laws of the state of Arizona. The central statute in this case was A.R.S. § 33-1242.

Burden of Proof

The obligation on a party in a legal case to prove its allegations. In this matter, Mr. Garcia bore the burden of proof to show that Villagio committed the alleged violation.

CC&Rs (Covenants, Conditions, and Restrictions)

The governing documents that dictate how a condominium or planned community must be operated and maintained, and which contain the rules that unit owners must follow. Mr. Garcia was accused of violating the short-term lease provisions of Villagio’s CC&Rs.

Certified Mail

A type of mail service that provides the sender with a mailing receipt and electronic verification that an article was delivered or that a delivery attempt was made. A.R.S. § 33-1242(B) specifies this method for a unit owner’s written response to a violation notice.

Evidentiary Hearing

A formal proceeding, similar to a trial, where parties present evidence (such as testimony and documents) to a neutral decision-maker. Hearings were held in this case on October 30, 2018, and February 12, 2019.

Office of Administrative Hearings

A state agency that conducts impartial hearings for other state agencies, boards, and commissions. This office was responsible for conducting the hearings in this case.

Petitioner

The party who initiates a legal action by filing a petition. In this case, Rogelio A. Garcia was the Petitioner.

Preponderance of the Evidence

The standard of proof required in this case. It is 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.”

Rehearing

A second hearing of a case to reconsider the original decision, often granted to review the evidence or arguments. Mr. Garcia requested and was granted a rehearing after the initial decision was issued.

Respondent

The party against whom a petition is filed; the party who must respond to the allegations. In this case, the Villagio at Tempe Homeowners Association was the Respondent.

Unit Owner

A person who owns a unit within a condominium or planned community and is subject to the association’s governing documents. Mr. Garcia is a unit owner in the Villagio at Tempe community.

Select all sources

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19F-H1918009-REL-RHG

2 sources

These sources consist of two Administrative Law Judge Decisions from the Office of Administrative Hearings regarding a dispute between Rogelio A. Garcia (Petitioner) and the Villagio at Tempe Homeowners Association (Respondent). The first document records the initial decision from October 2018, which dismissed Mr. Garcia’s petition alleging the HOA violated Arizona statute § 33-1242 by not providing required information following a notice of violation for short-term leasing. The second document details the rehearing decision from February 2019, which again found that Mr. Garcia failed to prove the HOA violated the statute because he did not respond to the violation notices by certified mail within the mandatory 21-day period to trigger the HOA’s legal obligations. Both rulings concluded that since the HOA provided him with the process for contesting the notices, they were not required to provide written notice of his option to petition for an administrative hearing. Consequently, both decisions dismissed Mr. Garcia’s petition and designated the HOA as the prevailing party.

What are the legal requirements concerning notice and response for HOA violations?

How did the unit owner’s failure to respond impact their statutory rights?

What legal interpretation was key to dismissing the homeowner’s administrative petition?

Case Participants

Petitioner Side

Rogelio A. Garcia (petitioner)
Appeared on behalf of himself,

Respondent Side

Nathan Tennyson (HOA attorney)
Brown Olcott, PLLC
Appeared on behalf of Respondent Villagio at Tempe Homeowners Association,
Tom Gordon (Community Manager/witness)
AAM LLC
Community Manager for Villagio; testified on behalf of Villagio

Neutral Parties

Velva Moses-Thompson (ALJ)
Administrative Law Judge,
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Recipient of electronic transmission of the decision,

Other Participants

Amanda Shaw (Representative/Contact)
AAM LLC
Listed as c/o for service of process for Villagio at Tempe Homeowners Association

Charles P Mandela vs. Blue Ridge Estates Homeowners Association of

Posted on November 6, 2018 by [email protected]

Case Summary

Case ID	19F-H1918006-REL-RHG
Agency	ADRE
Tribunal	OAH
Decision Date	2019-02-28
Administrative Law Judge	Velva Moses-Thompson
Outcome	none
Filing Fees Refunded	$0.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Charles P. Mandela	Counsel	—
Respondent	Blue Ridge Estates of Coconino County Homeowners' Association	Counsel	Paul K. Frame, Esq.

Alleged Violations

CC&Rs § 3.1(a)

Outcome Summary

The Administrative Law Judge denied the homeowner's petition in its entirety, finding the homeowner failed to meet the burden of proof to show the HOA violated CC&R § 3.1(a) when denying the construction of a cedar patio structure.

Why this result: Petitioner failed to establish that the HOA violated CC&R 3.1(a). The proposed structure was found to be a second detached structure and/or a temporary structure barred by the community documents, and the Petitioner had previously failed to submit sufficient information for an attached structure proposal.

Key Issues & Findings

Alleged violation of CC&Rs § 3.1(a) by denying request for patio structure while allowing another member to erect a Tuff Shed.

Petitioner alleged the HOA improperly denied his request for a detached cedar patio structure (150 sq ft) based on CC&R § 3.1(A) which limits properties to one detached structure (Petitioner already had a tool shed). The ALJ found Petitioner failed to establish the violation, concluding the proposed structure was a second barred detached structure or a temporary structure (as concrete pavers were not equivalent to a required cement/block foundation). Petitioner also failed to provide sufficient architectural details for an attached structure request.

Orders: Petitioner's petition is denied.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

A.R.S. § 32-2199(B)
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
CC&R § 3.1(a)
Architectural Committee Aligned Standard 3(D)

Analytics Highlights

Topics: HOA rules enforcement, architectural review, detached structures, temporary structures, rehearing

Additional Citations:

A.R.S. § 32-2199(B)
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
CC&R § 3.1(a)
Architectural Committee Aligned Standard 3(D)

Video Overview

Audio Overview

Decision Documents

19F-H1918006-REL Decision – 692294.pdf

Uploaded 2026-04-24T11:15:26 (119.5 KB)

19F-H1918006-REL Decision – 669528.pdf

Uploaded 2026-04-24T11:15:30 (91.9 KB)

Briefing Document: Mandela v. Blue Ridge Estates HOA

Executive Summary

This document synthesizes the findings and conclusions from two administrative law hearings concerning a dispute between homeowner Charles P. Mandela and the Blue Ridge Estates Homeowners Association of Coconino County (“Blue Ridge”). The core of the dispute was Blue Ridge’s repeated denial of Mr. Mandela’s requests to construct a 150-square-foot cedar patio structure on his property.

The Administrative Law Judge (ALJ) ultimately denied Mr. Mandela’s petition in both an initial hearing and a subsequent rehearing, finding that the homeowner failed to meet the burden of proof to establish any violation of the association’s governing documents. The ALJ’s decisions affirmed that Blue Ridge acted within its authority and correctly applied its Covenants, Conditions, and Restrictions (CC&Rs) and architectural regulations.

Key takeaways from the rulings include:

• Violation of Detached Structure Limit: Mr. Mandela’s request for a detached patio was denied because he already had a tool shed, and the HOA rules explicitly permit only one detached structure per property.

• Improper “Play Structure” Request: An initial request framing the patio as a “play structure” was correctly denied as its proposed 150 sq. ft. size exceeded the 80 sq. ft. limit for certain play structures.

• Insufficient Plans for Attached Structure: A separate request to attach the structure to his home was denied due to Mr. Mandela’s failure to provide the required detailed architectural plans and construction drawings, which the HOA deemed necessary for approval.

• Arguments Found Lacking: Mr. Mandela’s arguments—including claims of selective enforcement, discrimination against homeowners without children, and misinterpretation of the term “temporary structure”—were found to be unsubstantiated by evidence. The ALJ concluded the structure would be a prohibited temporary structure as the proposed concrete pavers do not constitute a permanent foundation under the HOA’s definition.

Case Overview

Parties Involved

Description

Petitioner

Charles P. Mandela

A homeowner and member of the Blue Ridge Estates HOA.

Respondent

Blue Ridge Estates Homeowners Association of Coconino County

The governing homeowners’ association for the Blue Ridge Estates development.

Adjudicator

Velva Moses-Thompson

Administrative Law Judge, Office of Administrative Hearings.

Timeline of Key Events

c. Feb 1, 2018

Mr. Mandela submits his first request for a 150 sq. ft. patio, using a “Play Structure Approval Request” form. Blue Ridge denies it for exceeding the size limit.

c. Mar 2, 2018

Mr. Mandela submits a second request, this time to attach a cedar patio shade to his home. Blue Ridge requests detailed plans and materials.

c. Mar 8, 2018

Blue Ridge denies the request for an attached structure due to “incomplete information,” instructing Mr. Mandela to provide formal drawings as per CC&R guidelines.

c. Mar 23, 2018

Mr. Mandela files an internal appeal with Blue Ridge, which is subsequently denied for the same reason of incomplete construction information.

Post-Mar 23, 2018

Mr. Mandela submits a third request for a detached 150 sq. ft. cedar patio structure. Blue Ridge denies it because he already has a detached tool shed.

c. Jul 31, 2018

Mr. Mandela files a petition with the Arizona Department of Real Estate, alleging Blue Ridge violated CC&R § 3.1(a) by denying his request while allowing another member a Tuff Shed.

Oct 17, 2018

An evidentiary hearing is held before the Office of Administrative Hearings.

Nov 6, 2018

The ALJ issues the initial decision, denying Mr. Mandela’s petition.

Dec 12, 2018

The Arizona Department of Real Estate orders a rehearing of the matter.

Feb 8, 2019

The rehearing is held before the same ALJ.

Feb 28, 2019

The ALJ issues the final decision, again finding in favor of Blue Ridge and denying Mr. Mandela’s petition.

Analysis of Construction Requests and Denials

Mr. Mandela made three distinct applications to the Blue Ridge Architectural Committee for his proposed 150 sq. ft. cedar patio structure, each of which was denied for different reasons based on the HOA’s governing documents.

Request 1: Detached “Play Structure”

Mr. Mandela’s initial application on February 1, 2018, was submitted using a “Play Structure Approval Request” form.

• HOA Rule: The form, based on modified Rules and Regulations from April 6, 2016, states: “Cannot exceed 80 SF if it’s a Tree House, Tree Viewing Stand, Play House/Fort.”

• Denial Rationale: Blue Ridge denied the request because the proposed 150 sq. ft. size of the structure exceeded the 80 sq. ft. limit specified for this type of structure.

Request 2: Attached Cedar Patio Shade

On March 2, 2018, Mr. Mandela submitted a new request to attach the structure to his home.

• HOA Action: The committee chairman, John Hart, requested documents showing the structure would not be free-standing, such as plans and material specifications.

• Mandela’s Response: In a March 3 email, Mr. Mandela stated: “I am building this myself. I am not an Architect, I have not software to show (6) 2 by 4”s to attach from the single family roof lie to the roof lien of the same roof.” He asserted that photos of other attached structures were sufficient.

• Denial Rationale: The request was denied on March 8 due to “incomplete information.” The denial letter explicitly instructed Mr. Mandela to submit all required documents, including drawings that “match exactly what you are going to build,” per CC&R Section 10.3. His subsequent appeal was also denied, with Blue Ridge noting that a manufacturer’s representative stated they would not warranty the product if the design was altered and reiterating the need for detailed elevation drawings.

Request 3: Detached Cedar Patio Structure

Following the denial of his appeal, Mr. Mandela submitted a third request for a detached version of the patio.

• HOA Rule: According to CC&R § 3.1(A) and Architectural Committee Aligned Standard 3(D), “One detached structure may… be constructed on a property.”

• Denial Rationale: Blue Ridge denied this request because Mr. Mandela already had one detached structure—a tool shed—on his property. The rules permit only one such structure.

Key Arguments and Rulings from Administrative Hearings

At the initial hearing and subsequent rehearing, both parties presented arguments regarding the application of the HOA’s rules. The ALJ systematically addressed and ruled on each point, ultimately concluding that the petitioner failed to prove his case.

Petitioner’s Core Arguments (Charles P. Mandela)

• Definition of “Detached Structure”: He argued that his proposed patio was not a “detached structure” under the CC&Rs because, based on his misinterpretation of a prior administrative ruling, a detached structure is one that can be easily converted into a second residence.

• Selective Enforcement: He alleged that Blue Ridge approved a “Tuff Shed” for another member and was not enforcing the 80 sq. ft. play structure size limit against other homeowners, thus discriminating against him.

• Discriminatory Rules: He contended that the rule allowing a second detached structure if it is a “play structure” violates CC&R 3.1 because it discriminates against people without children. He stated he wanted the patio for his mother.

• Definition of “Temporary Structure”: He asserted the structure was not a prohibited temporary structure because he planned to use concrete pavers, which he claimed constituted a “cement foundation” under the rules, and the materials had a 5-year warranty.

Respondent’s Core Arguments (Blue Ridge Estates HOA)

• One Detached Structure Rule: The rules unambiguously limit homeowners to one detached structure, and Mr. Mandela already had one.

• Incomplete Submissions: The request for an attached structure lacked the necessary architectural details to ensure it was properly and safely constructed, as required by the CC&Rs. Joseph Hancock, Vice President of Blue Ridge and a former contractor, testified that Mr. Mandela failed to consider critical factors like height and width differentials.

• Temporary Structure Violation: Mr. Hancock testified that a concrete paver is not the equivalent of a “cement or slab foundation.” Therefore, the proposed structure would be a prohibited temporary structure under the CC&Rs.

• No Selective Enforcement: Mr. Hancock refuted Mr. Mandela’s claims of selective enforcement, testifying that the lots Mr. Mandela cited either had structures built before 2003 (predating certain rules) or had no detached structures at all.

Administrative Law Judge’s Final Conclusions

The ALJ found that Mr. Mandela failed to establish his claims by a preponderance of the evidence. The final order denied his petition based on the following conclusions of law:

• Burden of Proof: The petitioner did not meet his burden to prove that Blue Ridge violated CC&R Article III, Section 3.1(a).

• Second Detached Structure: It was undisputed that Mr. Mandela had a shed on his property. The proposed 150 sq. ft. patio therefore constituted a barred second detached structure.

• Prior Rulings Not Precedent: The ALJ noted that Mr. Mandela misinterpreted the prior administrative decision he cited and, furthermore, that “prior administrative law judge decisions are not precedent or binding on future administrative law decisions.”

• Temporary Structure: The preponderance of the evidence showed the proposed structure is a temporary structure under the CC&Rs because “concrete pavers are not the equivalent of cement or block foundation.”

• Denial of Attached Structure: The denial of the request to attach the structure was proper, as the “Petitioner failed to provide sufficient details to illustrate how he would attach the cedar patio structure to his home.”

• No Evidence of Discrimination: The petitioner failed to establish that Blue Ridge approved other oversized play structures or that the denial of his requests was discriminatory. The ALJ also noted the tribunal lacked jurisdiction over potential constitutional claims under the Fourteenth Amendment.

Relevant HOA Governing Documents

Document/Section

Key Provision / Definition

CC&R § 3.1

Permitted Uses and Restrictions – Single Family: “No building or structure shall be erected or maintained separate from the Single Family Residence located on any Lot, other than a garage…”

Architectural Committee Aligned Standard 3(D)

Detached Structures: “One detached structure may, with Architectural Committee approval, be constructed on a property.”

CC&R § 3.6 & Aligned Standard

Temporary Structures: Prohibits temporary structures. A temporary structure is defined as one “without a cement or block foundation to which the structure or building is permanently attached.”

Modified Rules and Regulations (April 6, 2016)

Play Structures: Allows up to two play structures but specifies they “Cannot exceed 80 SF if it’s a Tree House, Tree Viewing Stand, Play House/Fort.”

CC&R § 3.24

Architectural Approval: “No building, fence, wall, screen, residence or other structure shall be commenced, erected, maintained, improved or altered… without the prior written approval of the… Architectural Committee.”

CC&R § 10.3

Architectural Submission Guidelines: Specifies the format and information required for submittals to the architectural committee.

CC&R § 12.2

Declaration Amendments: Requires an affirmative vote or written consent of members owning at least 75% of all lots to amend the Declaration.

Study Guide: Mandela v. Blue Ridge Estates HOA

This study guide provides a comprehensive review of the administrative legal dispute between petitioner Charles P. Mandela and respondent Blue Ridge Estates Homeowners Association of Coconino County. The case revolves around Mr. Mandela’s multiple attempts to gain approval for a patio structure on his property and the subsequent legal proceedings. The material is drawn from two Administrative Law Judge Decisions, dated November 6, 2018, and February 28, 2019.

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Instructions: Answer the following questions in 2-3 complete sentences, drawing your information directly from the provided case documents.

1. What were the three distinct requests Mr. Mandela submitted to the Blue Ridge Estates HOA, and what was the outcome of each?

2. Explain the HOA’s rule regarding detached structures and why Mr. Mandela’s third request for a detached patio was denied under this rule.

3. On what grounds did the HOA deny Mr. Mandela’s second request to attach a cedar patio shade to his home?

4. What was Mr. Mandela’s primary allegation in his initial petition filed with the Department of Real Estate on July 31, 2018?

5. How do the Blue Ridge rules define a “temporary structure,” and why did the Administrative Law Judge conclude Mr. Mandela’s proposed patio fell into this category?

6. Describe Mr. Mandela’s discrimination argument regarding the HOA’s policy on play structures.

7. What is the legal standard of proof the petitioner was required to meet in this case, and what does this standard mean?

8. Mr. Mandela cited a prior administrative law judge decision to support his case. What was his interpretation of that decision, and how did the presiding judge respond to this line of argument?

9. Who is Joseph Hancock, and what key pieces of testimony did he provide on behalf of the HOA during the rehearing?

10. According to the CC&Rs, what is the procedural difference between amending the Declaration (the CC&Rs themselves) versus adopting new “Rules and Regulations”?

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Answer Key

1. Mr. Mandela first submitted a “Play Structure Approval Request” for a 150-square-foot patio, which was denied for exceeding the 80-square-foot size limit for such structures. His second request was to attach a cedar patio shade to his home, which was denied due to incomplete information and a lack of adequate plans. His third request was for a detached 150-square-foot patio structure, which was denied because he already had another detached structure on his property.

2. According to CC&Rs § 3.1(A) and Architectural Committee regulation 3(D), a property is permitted to have only one detached structure. Mr. Mandela’s third request was denied because it was undisputed that he already had a tool shed on his property. The proposed detached patio would have constituted a prohibited second detached structure.

3. The HOA denied the request to attach the patio shade because Mr. Mandela submitted incomplete information and failed to provide sufficient plans. The HOA requested detailed elevation drawings showing construction methods, dimensions, foundation details, and attachment methods, which Mr. Mandela did not provide.

4. In his petition of July 31, 2018, Mr. Mandela alleged that the Blue Ridge HOA had violated CC&Rs § 3.1(a). His specific claim was that the HOA discriminated against him by denying his request to place a patio structure in his backyard while allowing another member to erect a Tuff Shed.

5. The Architectural Committee rules define a temporary structure as one “without a cement or block foundation to which the structure or building is permanently attached.” The judge concluded the proposed patio was a temporary structure because Mr. Mandela planned to use concrete pavers, which, according to the credible testimony of Joseph Hancock, are not the equivalent of a permanent cement or block foundation.

6. Mr. Mandela argued that the modified rule allowing a second detached play structure (up to 80 sq ft) violates CC&R 3.1 because it discriminates against people who do not have children. He asserted the policy was unfair because he wanted to build the structure for his mother to rest outside, not for children’s play.

7. The petitioner, Mr. Mandela, had the burden of proof to establish his claim by a “preponderance of the evidence.” This standard is defined as evidence that has the most convincing force and is sufficient to incline a fair and impartial mind to one side of an issue rather than the other, meaning the contention is more probably true than not.

8. Mr. Mandela argued that a prior administrative law judge decision had found that a “detached structure” under Blue Ridge CC&Rs is a structure that can be easily converted into a second residence, which his patio could not. The presiding judge dismissed this by stating that Mr. Mandela misinterpreted the prior ruling and, more importantly, that prior administrative law judge decisions are not binding precedent for future decisions.

9. Joseph Hancock is the Vice President of the Blue Ridge HOA and a former general, electrical, and HVAC contractor. He testified that concrete pavers are not equivalent to a cement or block foundation, that Mr. Mandela’s plans for attaching the structure were insufficient, and that he had investigated lots Mr. Mandela cited for alleged violations and found none.

10. According to the CC&Rs, adopting, amending, or repealing “Rules and Regulations” can be done by a majority vote of the Board (§ 4.2). In contrast, amending the Declaration of CC&Rs themselves is a much more stringent process, requiring the affirmative vote or written consent of members owning at least seventy-five percent (75%) of all lots (§ 12.2).

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Essay Questions

Instructions: The following questions are designed for a more in-depth analysis of the case. Formulate your answers in a standard essay format, using specific evidence from the source documents to support your arguments.

1. Analyze the progression of Mr. Mandela’s three distinct requests to the HOA. How did the denial of his first request (as a “Play Structure”) appear to influence his subsequent applications and legal arguments?

2. Discuss the concept of “burden of proof” as it applies in this case. Explain why Mr. Mandela ultimately failed to convince the Administrative Law Judge that the HOA violated its own rules, citing specific examples of his failed arguments (e.g., the temporary structure definition, claims of selective enforcement, and the adequacy of his submitted plans).

3. Examine the distinction made in the Blue Ridge Estates governing documents between the core CC&Rs and the “Rules and Regulations” adopted by the Board. How did this distinction allow the HOA to have a rule permitting a second “play structure” while the main CC&Rs seem to limit properties to a single residence and one other detached structure (a garage)?

4. The HOA denied Mr. Mandela’s request for an attached structure due to “incomplete information.” Based on the evidence presented in the decisions, evaluate the reasonableness of the HOA’s request for detailed plans versus Mr. Mandela’s assertion that he had provided sufficient information for approval.

5. Trace Mr. Mandela’s various claims of unfair treatment, including selective enforcement (the Tuff Shed), discrimination (the play structure rule), and his interpretation of key terms like “detached structure.” For each claim, explain the HOA’s counter-position or the Administrative Law Judge’s final conclusion.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An independent judge who presides over administrative hearings for state agencies, such as the one between Mr. Mandela and the HOA. In this case, the ALJ was Velva Moses-Thompson.

Architectural Committee

A committee within the HOA granted authority by CC&R § 10.2 to approve or deny proposed construction and promulgate regulations aligned with the CC&Rs. It denied all of Mr. Mandela’s requests.

Burden of Proof

The legal obligation of a party in a dispute to provide sufficient evidence to prove their claim. In this case, the petitioner (Mr. Mandela) bore the burden of proof.

Covenants, Conditions, and Restrictions. These are the primary governing documents for the Blue Ridge Estates community, outlining land use, permitted structures, and rules members must follow.

Detached Structure

A building or structure on a property that is separate from the main single-family residence. According to Architectural Committee regulation 3(D), only one such structure is permitted per lot.

Petitioner

The party who files a petition initiating a legal action. In this case, Charles P. Mandela is the petitioner.

Play Structure

A structure defined by the HOA’s modified rules to include items like Swing Sets, Jungle Gyms, Tree Houses, and Ground Placed Play Houses/Forts. Play Houses/Forts and Tree Houses are limited to 80 square feet.

Preponderance of the Evidence

The standard of proof required in this case. It is defined as “proof as convinces the trier of fact that the contention is more probably true than not,” representing the greater weight of the evidence.

Respondent

The party against whom a petition is filed. In this case, the Blue Ridge Estates Homeowners Association is the respondent.

Rules and Regulations

Rules that can be adopted, amended, or repealed by a majority vote of the HOA Board, as distinct from the CC&Rs which require a 75% vote of all lot owners to amend. The “Play Structure” rules are an example.

Temporary Structure

As defined by the Architectural Committee regulations, a structure “without a cement or block foundation to which the structure or building is permanently attached.” Such structures are prohibited by CC&R § 3.6.

Select all sources

669528.pdf

692294.pdf

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19F-H1918006-REL-RHG

2 sources

These sources document two decisions from the Office of Administrative Hearings concerning a dispute between Charles P. Mandela and the Blue Ridge Estates Homeowners Association (HOA). The first document presents the initial Administrative Law Judge (ALJ) Decision which denied Mr. Mandela’s petition, finding he failed to prove the HOA violated its governing documents by denying his request to build a patio structure. The second document is the ALJ Decision following a rehearing, which reaffirms the initial denial, concluding that Mr. Mandela’s proposed structure was either a prohibited second detached structure or a temporary structure lacking a proper foundation, and that he failed to provide sufficient plans for an attached structure. Both sources establish that Mr. Mandela did not meet his burden of proof to show the HOA discriminated against him or otherwise violated the Covenants, Conditions, and Restrictions (CC&Rs).

What were the specific reasons the HOA denied Charles Mandela’s requests?

How did the HOA Covenants, Conditions, and Restrictions govern detached structures?

What was the ultimate outcome of Charles Mandela’s petition and subsequent rehearing?

Case Participants

Petitioner Side

Charles P. Mandela (petitioner)

Respondent Side

Paul Frame (HOA attorney)
FRAME LAW PLLC
John Hart (HOA Chairman)
Blue Ridge Estates Homeowners Association
Reviewed petitioner's requests
Joseph Hancock (HOA Vice President, witness)
Blue Ridge Estates Homeowners Association
Presented testimony

Neutral Parties

Velva Moses-Thompson (ALJ)
OAH
Judy Lowe (ADRE Commissioner)
Arizona Department of Real Estate
Recipient of transmitted decision

Other Participants

Felicia Del Sol (administrative staff)
Transmitted decision electronically

Warren R. Brown vs. Mogollon Airpark, Inc(ROOT)

Posted on October 18, 2018 by [email protected]

Note: A Rehearing was requested for this case. The dashboard statistics reflect the final outcome of the rehearing process.

Case Summary

Case ID	18F-H1818029-REL-RHG; 18F-H1818045-REL; 18F-H1818054-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-18
Administrative Law Judge	Thomas Shedden
Outcome	The ALJ found Mogollon did not violate ARS § 33-1803(A) concerning the 39.4% assessment increase (Matters 029 and 054), rejecting the Petitioners' interpretation of 'regular assessment.' However, Petitioner Brown prevailed in Matter 045, proving Mogollon violated the late charge limit of ARS § 33-1803(A) by charging a $25 late fee, resulting in a refund of his $500 filing fee and rescission of the fee.
Filing Fees Refunded	$1,500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Warren R. Brown	Counsel	—
Respondent	Mogollon Airpark, Inc.	Counsel	Gregory A. Stein, Esq.; Mark K. Sahl, Esq.

Alleged Violations

ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)
ARIZ. REV. STAT. section 33-1803(A)

Outcome Summary

The ALJ found Mogollon did not violate ARS § 33-1803(A) concerning the 39.4% assessment increase (Matters 029 and 054), rejecting the Petitioners' interpretation of 'regular assessment.' However, Petitioner Brown prevailed in Matter 045, proving Mogollon violated the late charge limit of ARS § 33-1803(A) by charging a $25 late fee, resulting in a refund of his $500 filing fee and rescission of the fee.

Why this result: The assessment increase claims (029 and 054) were lost because the ALJ determined that interpreting 'regular assessment' as referring to the procedural method (motion, second, vote) would render the word 'regular' trivial or void in the statute.

Key Issues & Findings

Late payment charges limitation (045 Matter)

Petitioner Brown (045 matter) alleged the HOA violated ARS § 33-1803(A) by charging a $25 late fee. The ALJ found that the statutory limitation on late charges applies to all 'assessments,' not just 'regular assessments,' and found the $25 late charge was in violation.

Orders: Mogollon Airpark Inc. must rescind the $25 late fee assessed against Mr. Brown; Mogollon must pay Mr. Brown his filing fee of $500.00 within thirty days.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Assessment increase greater than 20% limit (029 Matter)

Petitioner Brown (029-RHG matter) argued the 39.4% increase violated the 20% cap because 'regular assessment' refers to the procedure for instituting any assessment. The ALJ rejected this interpretation, finding it rendered the word 'regular' void in the statute.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Assessment increase greater than 20% limit (054 Matter)

Petitioner Stevens (054 matter) alleged the HOA's $325 assessment increase was unlawful under the 20% cap. The ALJ dismissed the petition, applying the same statutory interpretation as in the 029 matter, holding that Mogollon's classification of the majority of the increase as a special assessment was valid under the statute.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

ARIZ. REV. STAT. section 33-1803(A)

Video Overview

Audio Overview

Decision Documents

18F-H1818029-REL-RHG Decision – 666285.pdf

Uploaded 2026-04-24T11:10:42 (151.9 KB)

18F-H1818029-REL-RHG Decision – 672623.pdf

Uploaded 2026-04-24T11:10:45 (144.6 KB)

Briefing Document: Brown and Stevens v. Mogollon Airpark, Inc.

Executive Summary

This document synthesizes the findings and conclusions of an Administrative Law Judge (ALJ) decision concerning three consolidated petitions filed by residents Warren R. Brown and Brad W. Stevens against their homeowners’ association, Mogollon Airpark, Inc. The core of the dispute revolves around a significant 2018 assessment increase and the legality of associated late fees under Arizona statute.

The central legal question was the interpretation of ARIZ. REV. STAT. section 33-1803(A), which limits an HOA’s ability to “impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year’s assessment.” The petitioners argued that the HOA’s total 39.4% increase violated this cap. The HOA contended the increase was comprised of a compliant “regular assessment” and a separate “special assessment” not subject to the cap.

The ALJ’s decision resulted in a split outcome:

• On the Assessment Increase: The judge ruled in favor of Mogollon Airpark, Inc. The petitions challenging the assessment increase were dismissed. The ALJ’s rationale was that statutory construction requires distinguishing between “regular” and “special” assessments, and the 20% cap applies only to the former.

• On the Late Fees: The judge ruled in favor of Petitioner Warren R. Brown. The HOA’s $25 late fee was found to be in violation of the statutory limit, which applies to “assessments” in general, not just “regular assessments.” The HOA was ordered to rescind the fee and reimburse the petitioner’s filing costs.

Underlying these specific legal challenges were broader allegations by the petitioners of deceptive accounting practices and financial mismanagement by the HOA’s treasurer, which they claimed were intended to create a false justification for the assessment increase. These allegations were noted but not adjudicated in this hearing.

I. Case Overview

The matter concerns a consolidated hearing held on September 28, 2018, at the Office of Administrative Hearings in Phoenix, Arizona. Administrative Law Judge Thomas Shedden presided over the case, which combined three separate petitions against the respondent, Mogollon Airpark, Inc.

• Petitioners: Warren R. Brown and Brad W. Stevens.

• Respondent: Mogollon Airpark, Inc.

• Docket Numbers:

◦ 18F-H1818029-REL-RHG (“029 matter”): Warren R. Brown, Petitioner

◦ 18F-H1818045-REL (“045 matter”): Warren R. Brown, Petitioner

◦ 18F-H1818054-REL (“054 matter”): Brad W. Stevens, Petitioner

II. Central Disputes and Allegations

A. The 2018 Assessment Increase (Matters 029 & 054)

The primary dispute centered on Mogollon Airpark’s 2018 assessment changes.

• Previous Assessment (2017): $825

• 2018 Increase: $325, representing a 39.4% total increase.

• HOA’s Breakdown of Increase:

◦ Regular Assessment Increase: $116 (a 14.1% increase over $825)

◦ Special Assessment: $209

• Legal Challenge: The petitioners alleged the total $325 increase violated ARIZ. REV. STAT. section 33-1803(A), which prohibits an HOA from imposing a “regular assessment that is more than [20%] greater than the immediately preceding fiscal year’s assessment” without member approval.

B. Late Fees and Interest Charges (Matter 045)

The second dispute, raised by Mr. Brown, concerned new penalties for late payments.

• New Charges: A $25 late fee and 18% interest on past-due accounts.

• Legal Challenge: Mr. Brown alleged these charges violated the same statute, which limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.” He presented an invoice showing he was charged a $25 late fee and $1.57 in interest.

C. Underlying Allegations of Financial Impropriety

Although the hearing’s scope was limited, the petitions were rooted in serious allegations of financial misconduct by the HOA. These claims formed the petitioners’ motive for challenging the assessments but were not the direct subject of the ALJ’s ruling.

• Core Claim: The petitioners asserted that Mogollon’s treasurer and others used “deceptive and nonstandard accounting methods,” including keeping two sets of books, to create the appearance of a financial shortfall.

• Alleged Purpose: This “fabricated shortfall” was allegedly used to convince the Board of Directors that a 39.4% dues increase was necessary.

• Petitioners’ Financial View: Mr. Stevens testified that he believed the HOA possessed funds in excess of $1 million and therefore did not require the increased assessment.

• ALJ’s Acknowledgment: The decision noted, “Considering the nature of Messrs. Brown and Stevens’s allegations, the civil courts may be better suited than an administrative tribunal to address the issues they raise. Regardless, the substance of their allegations was not addressed in this hearing.”

III. Arguments of the Parties

The central legal conflict hinged on the interpretation of the term “regular assessment” within the statute.

Petitioners’ Position (Brown & Stevens)

Respondent’s Position (Mogollon Airpark, Inc.)

Assessment Increase

The term “regular assessment” in § 33-1803(A) describes the process by which an assessment is instituted (i.e., by motion, second, and vote). Therefore, the entire $325 increase is a single assessment subject to and in violation of the 20% statutory cap. They further argued the HOA’s governing documents provide no authority to impose “special assessments.”

“Regular assessment” and “special assessment” are distinct types of assessments and industry terms of art. The 20% cap applies only to the regular portion. The $116 regular increase (14.1%) was compliant. The existence of the term “special assessment” in another statute (§ 33-1806) proves the legislature intended this distinction.

Late Fees

The 25latefeeisaclearviolationofthestatutorylimitof”15.00 or 10%.” The statutory text for late fees applies to “assessments” generally, not just “regular assessments.”

The statutory limit on late fees applies only to regular assessments. Since the late fee was charged on a special assessment, it did not violate the statute.

IV. Administrative Law Judge’s Decision and Rationale

The ALJ applied principles of statutory construction to arrive at a split decision, finding for the respondent on the main issue of the assessment increase but for the petitioner on the secondary issue of late fees.

A. Ruling on the Assessment Increase (Matters 029 & 054)

• Conclusion: The petitions filed by Mr. Brown and Mr. Stevens were dismissed. Mogollon Airpark, Inc. was deemed the prevailing party.

• Rationale: The judge concluded that the petitioners had not shown by a preponderance of the evidence that the statute was violated. Their definition of “regular assessment” as a procedural term was found to be inconsistent with principles of statutory construction. The judge reasoned that if “regular” simply meant the standard process of passing an assessment, the word would be redundant (“trivial or void”) because all assessments must follow that process. This interpretation supports the view that the legislature intended to differentiate between types of assessments, and that the 20% cap applies only to the “regular” type.

B. Ruling on Late Fees (Matter 045)

• Conclusion: Petitioner Warren R. Brown was deemed the prevailing party.

• Rationale: The judge rejected Mogollon’s argument that late fee limits apply only to regular assessments. The statutory text states, “Charges for the late payment of assessments are limited to…” without the “regular” qualifier. The ALJ determined that adding the word “regular” where the legislature chose to omit it would violate statutory construction principles. Therefore, the $25 late fee, being greater than the allowed $15 or 10%, was illegal.

V. Final Orders

The ALJ issued the following binding orders on October 18, 2018:

• ORDER FOR DOCKET NO. 18F-H1818029-REL-RHG (Brown vs. Mogollon):

◦ The petition is dismissed.

• ORDER FOR DOCKET NO. 18F-H1818045-REL (Brown vs. Mogollon):

◦ Petitioner Warren R. Brown is deemed the prevailing party.

◦ Mogollon Airpark Inc. must rescind the $25 late fee it assessed against Mr. Brown.

◦ Mogollon Airpark Inc. must pay Mr. Brown his filing fee of $500.00 within thirty days.

• ORDER FOR DOCKET NO. 18F-H1818054-REL (Stevens vs. Mogollon):

◦ The petition is dismissed.

Study Guide: Brown and Stevens v. Mogollon Airpark, Inc.

This study guide provides a review of the consolidated administrative hearing involving petitioners Warren R. Brown and Brad W. Stevens against the respondent, Mogollon Airpark, Inc. The case centers on disputes over Homeowners Association (HOA) assessments and fees under Arizona law.

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Short-Answer Quiz

Instructions: Answer the following questions in 2-3 sentences based on the information provided in the case documents.

1. Who were the primary parties involved in this consolidated matter and what were their respective roles?

2. What specific actions did Mogollon Airpark, Inc. take in 2018 that led to the legal petitions?

3. What was the total percentage increase of the 2018 assessment, and how did Mogollon Airpark, Inc. break down this increase?

4. Explain the petitioners’ main legal argument regarding the assessment increase and which statute they claimed was violated.

5. How did Mogollon Airpark, Inc. legally defend its decision to increase the assessment by more than 20%?

6. What was the central issue in the “045 matter” filed by Warren R. Brown?

7. Upon what legal principle did the Administrative Law Judge primarily rely to reach his conclusions on both the assessment increase and the late fee?

8. Why did the judge rule in favor of Mogollon Airpark on the assessment increase but in favor of Warren R. Brown on the late fee?

9. What were the underlying allegations made by the petitioners concerning Mogollon Airpark’s financial management that were not addressed in the hearing?

10. What was the final outcome and order for each of the three consolidated petitions (029, 045, and 054)?

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Answer Key

1. The petitioners were Warren R. Brown (dockets 029 and 045) and Brad W. Stevens (docket 054), who were members of the HOA. The respondent was Mogollon Airpark, Inc., the HOA being challenged. The matter was decided by Administrative Law Judge Thomas Shedden.

2. Mogollon Airpark, Inc. raised its 2018 assessment by a total of $325. It also instituted a new $25 fee for late payments and began charging 18% interest on past-due accounts.

3. The total increase of $325 over the previous year’s assessment of $825 constituted a 39.4% increase. Mogollon classified this increase as two separate parts: a $116 (14.1%) increase to the “regular assessment” and a $209 “special assessment.”

4. The petitioners argued that the total $325 increase violated ARIZ. REV. STAT. section 33-1803(A), which prohibits an HOA from imposing a “regular assessment” that is more than 20% greater than the previous year’s assessment. They contended that the term “regular assessment” refers to the standard process of levying an assessment (motion, second, vote), not a specific type of assessment.

5. Mogollon Airpark, Inc. argued that the 20% limit in section 33-1803(A) applies only to “regular assessments” and not to “special assessments,” which it claimed is a separate term of art in the industry. Since the increase to the regular assessment was only $116 (14.1%), it was below the 20% statutory threshold and therefore legal.

6. The central issue in the “045 matter” was Warren R. Brown’s allegation that Mogollon’s $25 late fee and 18% interest charge violated section 33-1803(A). The statute limits late charges to the greater of fifteen dollars or ten percent of the unpaid assessment.

7. The judge primarily relied on principles of statutory construction. This involved giving meaning to every word in the statute and not reading words into a provision where the legislature omitted them, which led to different interpretations of the statute’s clauses on assessments versus late fees.

8. The judge ruled against the petitioners on the assessment because their interpretation would make the word “regular” in the statute redundant. However, he ruled for Brown on the late fee because the statutory text limits charges on “assessments” in general, not just “regular assessments,” and to rule otherwise would require adding a word the legislature did not include.

9. The petitioners alleged that Mogollon’s treasurer engaged in deceptive and nonstandard accounting practices, including keeping two sets of books, to create a “fabricated shortfall.” They claimed this was done to falsely justify the need for the assessment increase, as the HOA actually had over $1 million in funds.

10. The petitions in the 029 matter (Brown) and 054 matter (Stevens) concerning the assessment increase were both dismissed. The petition in the 045 matter (Brown) concerning the late fee was successful; Mogollon was ordered to rescind the $25 fee and reimburse Brown’s $500 filing fee.

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Essay Questions

Instructions: Consider the following questions for a more in-depth analysis of the case. Formulate a comprehensive response based solely on the information in the provided legal decision.

1. Analyze the role of statutory construction in the Administrative Law Judge’s decision. How did the interpretation of the specific word “regular” and the general term “assessments” shape the final, divergent outcomes for the consolidated petitions?

2. Discuss the petitioners’ underlying allegations of deceptive accounting practices. Although not the central issue of the hearing, how did these claims frame the dispute, and why did the judge note that civil courts might be better suited to address them?

3. Compare and contrast the legal arguments presented by the petitioners and the respondent regarding the interpretation of ARIZ. REV. STAT. section 33-1803(A). Evaluate the strengths and weaknesses of each side’s position as described in the decision.

4. Trace the procedural history of the “029 matter,” from its initial filing and dismissal to the rehearing. What does this progression reveal about the procedural requirements for filing a successful petition with the Office of Administrative Hearings?

5. Evaluate the outcome of the consolidated hearing. Why was one petitioner successful on one claim while both were unsuccessful on another, despite the claims originating from the same set of actions by the HOA?

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

The official, in this case Thomas Shedden, who presides over hearings at the Office of Administrative Hearings and issues decisions and orders.

ARIZ. REV. STAT. section 33-1803(A)

The specific Arizona statute at the center of the dispute. It limits HOA “regular assessment” increases to 20% over the prior year and caps late payment charges at the greater of $15 or 10% of the unpaid assessment.

Assessment

A fee imposed by an HOA on its members. The case distinguishes between a “regular assessment” (a recurring charge) and a “special assessment” (a one-time charge for a specific purpose).

Burden of Proof

The obligation of the petitioners, Messrs. Brown and Stevens, to prove their allegations against the respondent.

Consolidated Matter

The joining of multiple, separate legal petitions (in this case, 029, 045, and 054) into a single hearing because they involved the same parties and related issues.

Petitioner

A party who files a petition initiating a legal action. In this matter, Warren R. Brown and Brad W. Stevens were the petitioners.

Preponderance of the Evidence

The standard of proof required in this administrative hearing. It is defined as evidence with the most convincing force that inclines an impartial mind to one side of an issue over the other.

Respondent

The party against whom a petition is filed. In this matter, Mogollon Airpark, Inc. was the respondent.

Single-Issue Petition

A petition filed with the Department of Real Estate that is limited to a single allegation, which in the case of Mr. Stevens’s 054 matter required a $500 filing fee.

Statutory Construction

The legal process of interpreting and applying legislation. The judge used principles of statutory construction to determine the meaning of “regular assessment” and “assessments” in the relevant statute.

How One Word Created an HOA Loophole for a 40% Fee Hike—And How Another Word Gave a Homeowner a Key Victory

1.0 Introduction: The Dreaded HOA Letter

It’s the letter every homeowner dreads opening. A crisp envelope from the Homeowners Association lands in your mailbox, and inside is a notice that your mandatory fees are about to skyrocket. For a group of homeowners in Arizona’s Mogollon Airpark, this scenario became a reality when their HOA announced a staggering 39.4% increase in their annual assessments.

What followed was a legal battle that provides a fascinating and cautionary tale for every homeowner living under an HOA. The dispute, which pitted homeowners Warren Brown and Brad Stevens against Mogollon Airpark, Inc., didn’t hinge on fairness or financial need, but on the legal interpretation of a single word. This article distills the surprising and counter-intuitive lessons learned from their fight, revealing loopholes and legal technicalities that can make all the difference.

2.0 A 40% Fee Hike Can Be Legal Thanks to the “Special Assessment” Loophole

The core of the dispute was the massive fee hike. Mogollon Airpark, Inc. raised its 2018 assessment by $325 from the previous year’s $825—a 39.4% increase. This seemed to be a clear violation of Arizona law (ARIZ. REV. STAT. section 33-1803(A)), which explicitly prohibits an HOA from increasing a “regular assessment” by more than 20% in one year without a majority vote from members.

The HOA, however, employed a clever strategy. It split the $325 increase into two distinct parts:

• A $116 “regular assessment” increase, which amounted to a legal 14.1% hike.

• A separate $209 “special assessment.”

The HOA argued that the 20% statutory cap only applied to the “regular” portion of the increase, making their move perfectly legal.

The homeowners countered that this was a deceptive maneuver. They argued that the term “regular assessment” in the law refers to the process of creating an assessment (a motion, a second, and a vote), not a specific type of assessment. From their perspective, the entire 39.4% increase was a single action and was therefore illegal.

In a surprising ruling, the Administrative Law Judge sided with the HOA. The judge reasoned that if the homeowners’ interpretation was correct and all assessments followed the same “regular” process, then the word “regular” in the statute would be rendered “trivial or void.” By giving meaning to that single word, the judge affirmed that “regular assessments” and “special assessments” are different categories, and the 20% cap only applies to the former. This interpretation effectively creates a significant loophole for HOAs to bypass statutory limits and implement large fee increases.

3.0 The Devil Is in the Details: “Regular Assessment” vs. “Assessments”

While the HOA won the main argument over the 39.4% increase, they lost on a smaller but crucial point: late fees. Along with the assessment hike, the HOA instituted a new $25 late fee for overdue payments.

Homeowner Warren Brown challenged this fee, pointing to the same state law. He argued that the statute limits late fees to “the greater of fifteen dollars or ten percent of the amount of the unpaid assessment.” Since the new $25 fee exceeded this limit, it was a direct violation.

Emboldened by their victory on the assessment increase, the HOA extended its logic, arguing that since the late fee was applied to a special assessment, the statutory limit—which they claimed was intended for regular assessments—did not apply.

This time, the judge decisively ruled in favor of the homeowner. The judge highlighted a critical distinction in the law’s wording. The part of the statute limiting assessment increases uses the specific term “regular assessment.” However, the part of the law limiting late charges uses the broader, more general term “assessments.” The omission of the word “regular” was the key.

The judge’s reasoning was a masterclass in statutory construction:

This argument fails because the statute’s limit on late charges applies to “assessments,” not “regular assessments.” Under Mogollon’s interpretation, it is necessary to add the word “regular” where the legislature chose not to use it. This violates principles of statutory construction.

This outcome underscores the immense importance of precise legal language. The legislature’s choice to omit a single word in one clause of a law gave the homeowner a clear victory and held the HOA accountable.

4.0 Serious Allegations Don’t Guarantee a Day in Court

Underlying the homeowners’ legal challenge were serious allegations of financial misconduct. Mr. Brown and Mr. Stevens claimed the HOA treasurer used “deceptive and nonstandard accounting methods,” kept “two sets of books,” and created a “fabricated shortfall” to justify the assessment increase and “convince the Board that a 39.4% increase in dues was required.”

Surprisingly, none of these explosive allegations were addressed during the hearing. The reason for this is a crucial lesson in legal strategy. The homeowners had filed “single-issue petitions,” which legally limited the scope of the administrative hearing to one narrow question: did the HOA violate the specific statute governing assessment increases (ARIZ. REV. STAT. section 33-1803(A))? All other matters, including the allegations of accounting improprieties, were outside the hearing’s jurisdiction.

The judge explicitly noted this limitation in a footnote to the decision:

Considering the nature of Messrs. Brown and Stevens’s allegations, the civil courts may be better suited than an administrative tribunal to address the issues they raise. Regardless, the substance of their allegations was not addressed in this hearing.

This case is a powerful reminder that in law, the structure of your argument can be more important than the weight of your accusations. By filing a narrow petition, the homeowners guaranteed a hearing on that one issue but forfeited the chance to have their broader, more serious claims heard in that venue.

5.0 A Partial Victory Is Still a Victory

The final outcome of the consolidated case was decidedly mixed. The homeowners lost their primary challenge, and the court upheld the HOA’s $325 assessment increase.

However, Mr. Brown was officially deemed the “prevailing party” in his case regarding the illegal late fees. This was not just a moral victory; it came with a direct order from the judge. Mogollon Airpark Inc. was ordered to:

• Rescind the $25 late fee it assessed against Mr. Brown.

• Pay Mr. Brown back his $500 filing fee for the case.

While it wasn’t the total win they had hoped for, this outcome demonstrates that a single, well-prepared homeowner can successfully hold their HOA accountable for breaking the law, even on smaller matters. It proves that knowing the rules and persevering can lead to tangible results, forcing an association to correct its illegal actions and compensating the homeowner for the cost of the fight.

6.0 Conclusion: Know the Law, Word by Word

The case of Brown and Stevens vs. Mogollon Airpark is a potent lesson in how legal battles are won and lost in the margins. A single word—”regular”—opened a loophole for the HOA to impose a nearly 40% fee hike, while the deliberate absence of that same word in a later clause empowered a homeowner to strike back and win.

This case serves as a powerful reminder that when it comes to the laws governing your community, every word matters. It poses a vital question for all homeowners: are the protections you count on in state law as ironclad as you think, or could they evaporate based on the interpretation of a single adjective?

Case Participants

Petitioner Side

Warren R. Brown (petitioner)
Appeared on his own behalf
Brad W. Stevens (petitioner)
Appeared on his own behalf; presented testimony

Respondent Side

Gregory A. Stein (attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Counsel for Respondent Mogollon Airpark, Inc.
Mark K. Sahl (attorney)
CARPENTER, HAZLEWOOD, DELGADO & BOLEN LLP
Counsel for Respondent Mogollon Airpark, Inc.

Neutral Parties

Thomas Shedden (ALJ)
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Felicia Del Sol (clerk)
Transmitted the decision

Warren R. Brown vs. Mogollon Airpark, Inc

Posted on October 18, 2018 by [email protected]

Case Summary

Case ID	18F-H1818029-REL-RHG, 18F-H1818045-REL, 18F-H1818054-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-18
Administrative Law Judge	Thomas Shedden
Outcome	The ALJ dismissed the petitions regarding the assessment increase (Dockets 029 and 054), ruling that A.R.S. § 33-1803(A)'s 20% cap applies only to 'regular assessments' and not special assessments. However, the ALJ ruled in favor of Petitioner Brown regarding late fees (Docket 045), finding that the statutory limit on late charges applies to all assessments, ordering the HOA to rescind the $25 fee and refund the filing fee.
Filing Fees Refunded	$1,500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Warren R. Brown	Counsel	—
Respondent	Mogollon Airpark, Inc.	Counsel	Gregory A. Stein; Mark K. Sahl

Alleged Violations

A.R.S. § 33-1803(A)
A.R.S. § 33-1803(A)
A.R.S. § 33-1803(A)

Outcome Summary

The ALJ dismissed the petitions regarding the assessment increase (Dockets 029 and 054), ruling that A.R.S. § 33-1803(A)'s 20% cap applies only to 'regular assessments' and not special assessments. However, the ALJ ruled in favor of Petitioner Brown regarding late fees (Docket 045), finding that the statutory limit on late charges applies to all assessments, ordering the HOA to rescind the $25 fee and refund the filing fee.

Why this result: For the assessment issues, the ALJ rejected the petitioners' interpretation that 'regular' refers to the approval process rather than the assessment type, finding that applying the cap to special assessments would violate principles of statutory construction.

Key Issues & Findings

Assessment Increase (Docket 029 – Brown)

Petitioner alleged the HOA violated the statute by increasing assessments by $325 (39.4%), exceeding the 20% limit.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Late Fees (Docket 045 – Brown)

Petitioner alleged the HOA charged a $25 late fee, which exceeds the statutory limit of the greater of $15 or 10%.

Orders: Respondent ordered to rescind the $25 late fee and refund the $500 filing fee.

Filing fee: $500.00, Fee refunded: Yes

Disposition: petitioner_win

Assessment Increase (Docket 054 – Stevens)

Petitioner alleged the $325 assessment increase violated the statutory 20% cap and that the HOA used deceptive accounting.

Orders: Petition dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: respondent_win

Video Overview

Audio Overview

Decision Documents

18F-H1818045-REL Decision – 666285.pdf

Uploaded 2026-04-24T11:12:44 (151.9 KB)

18F-H1818045-REL Decision – 672623.pdf

Uploaded 2026-04-24T11:12:49 (144.6 KB)

18F-H1818045-REL Decision – 666285.pdf

Uploaded 2026-01-27T21:14:50 (151.9 KB)

18F-H1818045-REL Decision – 672623.pdf

Uploaded 2026-01-27T21:14:51 (144.6 KB)

Administrative Law Judge Decision: Brown and Stevens vs. Mogollon Airpark, Inc.

This briefing document provides a comprehensive analysis of the consolidated administrative hearing between Petitioners Warren R. Brown and Brad W. Stevens and Respondent Mogollon Airpark, Inc. (the HOA). The proceedings focused on the legality of assessment increases, late fees, and interest charges under Arizona Revised Statutes (A.R.S.).

Executive Summary

The matter originated from three separate petitions consolidated for a hearing held on September 28, 2018. The primary disputes involved a 39.4% total increase in annual assessments and the imposition of late fees and interest rates that allegedly exceeded statutory limits.

The Administrative Law Judge (ALJ) reached a split decision. Regarding the assessment increase, the ALJ ruled in favor of Mogollon Airpark, Inc., determining that the statutory 20% cap applies only to "regular assessments" and not to "special assessments." Consequently, petitions 18F-H1818029-REL-RHG and 18F-H1818054-REL were dismissed. However, in petition 18F-H1818045-REL, the ALJ ruled in favor of Warren R. Brown, finding that the HOA’s $25 late fee violated A.R.S. § 33-1803(A), which limits such charges. The HOA was ordered to rescind the fee and reimburse the petitioner's $500 filing fee.

Case Overview and Financial Context

The following table outlines the financial changes implemented by Mogollon Airpark, Inc. in 2018 that led to the legal challenge:

Item	Previous Year (2017)	New Rate (2018)	Percentage Increase
Total Assessment	$825.00	$1,150.00	39.4%
Regular Portion	$825.00	$941.00 ($116 increase)	14.1%
Special Portion	$0.00	$209.00	N/A
Late Fee	Not Specified	$25.00	N/A
Interest Rate	Not Specified	18%	N/A

Analysis of Key Themes

1. Statutory Interpretation of "Regular Assessment"

The central legal conflict involved A.R.S. § 33-1803(A), which states that an HOA shall not "impose a regular assessment that is more than [20%] greater than the immediately preceding fiscal year's assessment" without member approval.

Petitioners' Argument: Brown and Stevens argued that "regular" refers to the process by which an assessment is passed (motion, second, and vote) rather than the type of assessment. They contended that since the total amount rose by 39.4%, it violated the statute.
Respondent's Argument: Mogollon argued that "regular assessment" is a specific category of assessment. They claimed the "special assessment" of $209 was a separate category not subject to the 20% cap.
Judicial Conclusion: The ALJ agreed with the Respondent, noting that if "regular" only referred to the process, the word would be rendered "trivial or void" in the statute. The ALJ found that the 14.1% increase in the "regular" portion was within the legal 20% limit.

2. Authority to Impose Special Assessments

A recurring theme was whether the HOA had the authority to issue a special assessment at all.

The "Trial Run" Concern: Mr. Stevens testified that the $209 assessment was perceived as a "trial run" to see if the HOA could successfully bypass statutory limits to fund projects not authorized by governing documents.
Contractual Basis: The Petitioners argued the Bylaws and CC&Rs only allow dues for operating expenses and approved reserve funds.
Judicial Conclusion: The ALJ noted that while the Petitioners questioned the HOA's authority to impose special assessments, the "single-issue" nature of the petitions limited the hearing's scope to whether the HOA violated A.R.S. § 33-1803(A).

3. Allegations of Accounting Impropriety

Both petitioners alleged that Mogollon’s treasurer engaged in deceptive accounting to justify the assessment increase.

Claims of Fabricated Shortfall: Mr. Brown alleged that accounting procedures were altered to show a loss of funds, despite the 2016 board leaving the treasury $200,000 better off. Mr. Stevens alleged the use of "two sets of books" to create a false need for higher dues, stating his belief that the HOA actually possessed in excess of $1 million.
Judicial Conclusion: The ALJ acknowledged these allegations but did not rule on the substance of the accounting practices, suggesting that civil courts might be better suited for such claims.

4. Late Fee and Interest Limits

A.R.S. § 33-1803(A) limits late payment charges to the greater of $15 or 10% of the unpaid assessment.

The Conflict: The HOA charged a $25 late fee. They argued that because the limit appeared in a section discussing "regular assessments," it did not apply to late fees on "special assessments."
Judicial Conclusion: The ALJ rejected this argument. The statute’s limit on late charges applies to "assessments" generally, not just "regular assessments." Therefore, the $25 fee was found to be a violation of the law.

Important Quotes and Context

"Courts will not place an absurd and unreasonable construction on statutes."

Context: Used in Conclusion of Law #4 to explain that the ALJ must interpret the term "regular assessment" in a way that makes logical sense and provides a fair result.

"Under Mogollon’s interpretation, it is necessary to add the word 'regular' where the legislature chose not to use it. This violates principles of statutory construction."

Context: The ALJ's reasoning in Conclusion of Law #10 regarding why the HOA could not charge a $25 late fee. The legislature omitted the word "regular" in the late fee clause, meaning it applies to all assessments.

"It is believed that the accounting was deliberately misleading and was intended to present an inaccurate picture of the HOA finances."

Context: A statement from Mr. Brown's original petition (Finding of Fact #18) regarding the alleged motive behind the 2018 assessment increase.

Decision Summary by Docket

Docket Number	Petitioner	Ruling	Order
18F-H1818029-REL-RHG	Warren R. Brown	Dismissed	Petition dismissed; Mogollon is the prevailing party.
18F-H1818054-REL	Brad W. Stevens	Dismissed	Petition dismissed; Mogollon is the prevailing party.
18F-H1818045-REL	Warren R. Brown	Sustained	Brown is the prevailing party. HOA must rescind the $25 late fee and pay Brown’s $500 filing fee.

Actionable Insights

Statutory Precision: Organizations must distinguish between "regular" and "special" assessments in their financial planning. While regular assessments are capped by a 20% annual increase under A.R.S. § 33-1803(A), special assessments may fall outside this specific cap (provided the HOA has the underlying authority to levy them).
Uniform Late Fee Limits: Regardless of the type of assessment (regular or special), late fees must strictly adhere to the statutory limit of $15 or 10% of the unpaid amount. Associations cannot bypass this cap by reclassifying the assessment type.
Burden of Proof: In administrative hearings, the petitioner bears the burden of proof by a "preponderance of the evidence." Technical arguments regarding statutory definitions require strong support from principles of statutory construction to succeed.
Jurisdictional Limits: The Office of Administrative Hearings may be limited to specific statutory violations. Allegations of complex financial fraud or "deceptive accounting" may require resolution in civil court rather than an administrative tribunal.

Legal Study Guide: Brown and Stevens v. Mogollon Airpark, Inc.

This study guide provides a comprehensive analysis of the consolidated administrative hearing involving Warren R. Brown, Brad W. Stevens, and Mogollon Airpark, Inc. It examines the legal interpretations of Arizona statutes regarding Homeowners Association (HOA) assessments and late fees.

I. Case Overview and Context

Administrative Context

Venue: Office of Administrative Hearings, Phoenix, Arizona.
Administrative Law Judge: Thomas Shedden.
Hearing Date: September 28, 2018.
Consolidated Matters: Three petitions (Docket Nos. 18F-H1818029-REL-RHG, 18F-H1818045-REL, and 18F-H1818054-REL) were consolidated into a single hearing because they shared common allegations regarding deceptive accounting practices and statutory violations.

Key Parties

Party	Role	Legal Representation
Warren R. Brown	Petitioner (029 and 045 matters)	Self (Pro Se)
Brad W. Stevens	Petitioner (054 matter)	Self (Pro Se)
Mogollon Airpark, Inc.	Respondent (HOA)	Gregory A. Stein, Esq. and Mark K. Sahl, Esq.

II. Central Legal Issues and Facts

Financial Assessments in Dispute

In 2018, Mogollon Airpark, Inc. implemented significant changes to its assessment structure. The previous year’s assessment was $825.

2018 Assessment Breakdown:

Regular Assessment Increase: $116 (a 14.1% increase).
Special Assessment: $209.
Total Increase: $325 (a 39.4% total increase).
New Fees: A $25 late payment fee and 18% interest on past-due accounts.

Statutory Focus: ARIZ. REV. STAT. § 33-1803(A)

The primary legal conflict centered on the interpretation of A.R.S. § 33-1803(A), which dictates:

Assessment Caps: An association cannot impose a "regular assessment" more than 20% greater than the preceding fiscal year's assessment without majority member approval (unless community documents require a lower limit).
Late Fee Limits: Charges for late payments are limited to the greater of $15.00 or 10% of the unpaid assessment.

III. Arguments and Interpretations

Interpretation of "Regular Assessment"

Petitioners' Position: Brown and Stevens argued that "regular assessment" refers to the process by which an assessment is created (regularly scheduled votes via motion and second). Therefore, the total $325 increase (39.4%) violated the 20% statutory cap.
Respondent's Position: Mogollon argued that "regular assessment" is a specific type of assessment distinct from a "special assessment." They maintained that since the regular portion only increased by 14.1%, they were in compliance with the law.
ALJ Ruling: The judge sided with Mogollon. Under principles of statutory construction, if "regular" referred only to the process, the word would be rendered "trivial or void." The judge determined the 20% cap applies specifically to the category of "regular assessments."

Interpretation of Late Fee Limits

Respondent's Position: Mogollon argued the $25 late fee was lawful because A.R.S. § 33-1803(A) should only apply to regular assessments.
ALJ Ruling: The judge sided with Petitioner Brown (045 matter). The statute limits late charges for "assessments" generally, not just "regular assessments." By using the broad term "assessments," the legislature intended the cap ($15 or 10%) to apply to all late fees. Mogollon's $25 fee was found to be in violation.

Allegations of Accounting Impropriety

Petitioners alleged that Mogollon's treasurer used "deceptive and nonstandard accounting methods," including "keeping two sets of books," to fabricate a financial shortfall. They argued this was a "plan" to justify the 39.4% increase despite the HOA allegedly having over $1 million in funds. The ALJ noted that civil courts might be better suited for such fraud allegations and did not address the substance of the accounting practices in the final decision.

IV. Short-Answer Practice Questions

What was the previous year's assessment amount for Mogollon Airpark?

Answer: $825.

According to A.R.S. § 33-1803(A), what is the maximum percentage a regular assessment can increase without a majority vote?

Answer: 20%.

Why did the ALJ dismiss the 029 and 054 matters regarding the $325 increase?

Answer: Because the petitioners failed to prove that the increase in the regular assessment (which was only 14.1%) exceeded the 20% limit, and the judge ruled the cap does not apply to special assessments.

In the 045 matter, why was the $25 late fee ruled unlawful?

Answer: A.R.S. § 33-1803(A) limits late fees for all "assessments" to the greater of $15 or 10%; Mogollon’s $25 fee exceeded these statutory limits.

What is the "standard of proof" required for petitioners in this administrative hearing?

Answer: A preponderance of the evidence.

What was the ALJ’s order regarding Mogollon’s obligation to Warren R. Brown in the 045 matter?

Answer: Mogollon was ordered to rescind the $25 late fee and reimburse Mr. Brown his $500 filing fee.

V. Essay Prompts for Deeper Exploration

The Nuances of Statutory Construction: Analyze the ALJ's reasoning in applying different interpretations to the word "regular" versus the word "assessment" within the same statute (A.R.S. § 33-1803(A)). Why did the presence of the word "regular" in the first half of the statute exclude special assessments from the 20% cap, while the absence of that word in the second half meant late fee limits applied to all assessments?
The Burden of Proof and Evidence: Discuss the role of the "preponderance of the evidence" standard in this case. Evaluate why Brad Stevens's 600+ pages of exhibits and testimony regarding the HOA's $1 million surplus were insufficient to win the 054 matter, given the ALJ's focus on matters of law over accounting disputes.
Jurisdictional Limits of Administrative Hearings: The ALJ noted that civil courts might be better suited for allegations of accounting improprieties and deceptive practices. Explore the limitations of an administrative tribunal versus a civil court in resolving complex financial disputes within an HOA.

VI. Glossary of Important Terms

A.R.S. § 33-1803(A): The Arizona Revised Statute governing HOA assessments and late fees.
CC&Rs (Covenants, Conditions, and Restrictions): The governing documents that serve as a contract between the HOA and its members.
Community Documents: The collective term for an association’s Bylaws, CC&Rs, and other governing rules.
Preponderance of the Evidence: The legal standard of proof where the evidence is of "greater weight" or has the "most convincing force," inclining a fair mind to one side of the issue.
Prevailing Party: The party in a legal proceeding that successfully proves its case or defends against an allegation; in this case, Mogollon prevailed in 029/054, while Brown prevailed in 045.
Regular Assessment: An assessment levied on a recurring basis to cover the association's standard operating expenses.
Single-Issue Petition: A simplified petition filed with the Department of Real Estate focusing on a single alleged violation of statute or community documents.
Special Assessment: A specific, often one-time assessment charged to members for expenses not covered by regular assessments (e.g., paving).
Statutory Construction: The process by which courts interpret and apply legislation, ensuring every word is given meaning and results are sensible rather than "absurd."

HOA vs. Homeowners: Decoding the Mogollon Airpark Legal Ruling on Dues and Fees

In the high-altitude enclave of Mogollon Airpark, a legal dogfight over three hundred dollars has redefined the boundaries of HOA power in Arizona. Homeowners Warren R. Brown and Brad W. Stevens took their Association to court, challenging a sudden 39.4% spike in annual costs and aggressive late penalties.

The resulting administrative law ruling serves as a vital case study in Arizona’s planned community statutes. By examining ARIZ. REV. STAT. § 33-1803, the court clarified exactly where a Board’s authority ends and where homeowner protections—specifically the "20% cap"—begin.

The $325 Question: When is an Increase Too High?

The conflict began in 2018 when Mogollon Airpark, Inc. (the HOA) implemented a $325 increase per household. For the petitioners, this felt like a clear-cut violation of state law, which generally requires a majority vote for significant cost hikes.

To evaluate the legality of the Board’s move, the court looked at the breakdown of the $325 increase relative to the previous year’s $825 total:

2017 Total Assessment: $825
2018 "Regular" Portion Increase: $116 (a 14.1% increase)
2018 "Special" Portion (Paving): $209
Total 2018 Increase: $325
Total Percentage Increase: 39.4%

Brown and Stevens argued that any increase exceeding 20% in a single year is a violation of § 33-1803(A). They contended that "regular" in the statute refers to the process—meaning any assessment passed through a standard board vote should be subject to the cap. Under their interpretation, the label "special" was merely a semantic trick to bypass homeowner voting rights.

The Legal Definition of "Regular": Why the HOA Won the Assessment Battle

Despite the jarring 39.4% jump, Administrative Law Judge (ALJ) Thomas Shedden dismissed the petitions regarding the dues increase. The decision hinged on the principle of "Statutory Construction"—how courts interpret the precise wording of legislation.

The ALJ determined that the term "regular" in § 33-1803(A) defines a specific type of assessment rather than the voting process used to enact it. If "regular" merely meant an assessment passed by a motion and a vote, the judge reasoned, the word would be "trivial" or "redundant" because almost all assessments are passed that way.

The court's interpretation established two critical precedents:

The Cap is Narrow: The 20% limit only protects homeowners from increases in standard annual operating dues.
Special Assessments are Separate: Because the legislature included "regular" in the assessment cap portion of the law but omitted it elsewhere, the court concluded that "special" assessments—such as the $209 paving fee—do not count toward the 20% threshold.

Since the $116 "regular" increase was only 14.1% of the previous year's total, the HOA stayed within the legal boundary.

The Late Fee "Gotcha": Why the Homeowners Won the Penalty Battle

While the homeowners lost the fight over dues, Petitioner Warren R. Brown secured a strategic victory regarding penalties in Docket No. 18F-H1818045-REL. The HOA had been charging a $25 late fee and 18% interest on past-due accounts, even for the contested paving assessment.

Here, the ALJ applied a symmetrical logic that worked against the HOA. The ALJ noted that while the statute specifies "regular assessments" when discussing the 20% cap, the section governing late charges refers broadly to all "assessments."

The statute limits late charges to the greater of:

$15.00
10% of the unpaid assessment

The HOA argued the $25 fee was valid because it applied to a special assessment. The ALJ rejected this, refusing to "read in" the word regular where the legislature had purposely left it out. Consequently, the HOA was ordered to rescind Mr. Brown's $25 fee and—most significantly—reimburse his $500 filing fee.

Transparency and Accounting: The Allegations Beneath the Surface

The legal battle revealed deep-seated distrust within the community. Petitioner Brad W. Stevens provided 45 pages of testimony and 600 pages of exhibits, painting a picture of a Board manufacturing a financial crisis.

The allegations included:

The "Two Sets of Books": Claims that the treasurer used deceptive accounting to hide the fact that the 2016 board actually left the treasury $200,000 better off than when they started.
Hidden Reserves: Allegations that the HOA held over $1 million in reserves, making the paving assessment unnecessary.
The "Trial Run": Mr. Stevens testified that the paving assessment was a "trial run" to see if the Board could successfully bypass the membership to fund future unauthorized projects.

While the ALJ acknowledged these concerns, he noted that complex accounting disputes and claims of "fabricated shortfalls" are better suited for a civil court rather than an administrative tribunal.

Conclusion & Key Takeaways for Homeowners

The consolidated ruling for Mogollon Airpark highlights the technical nature of HOA law and the high bar for homeowners seeking to overturn Board decisions.

Final Case Outcomes

Case Number	Petitioner	Primary Issue	Outcome
18F-H1818029-REL-RHG	Warren R. Brown	$325 Assessment Increase	Dismissed (HOA Won)
18F-H1818045-REL	Warren R. Brown	$25 Late Fee / 18% Interest	Prevailing Party (Brown Won)
18F-H1818054-REL	Brad W. Stevens	$325 Assessment Increase	Dismissed (HOA Won)

Lessons Learned

For Boards: Your late fee structures must strictly adhere to the $15 or 10% limit across all assessment types. There is no statutory loophole for "special" assessment penalties.
For Homeowners: The 20% cap is not a total shield. If your Board classifies a portion of a hike as a "special assessment" for a specific project like paving, the statutory cap likely won't protect you.
For Both: Procedural accuracy is paramount. A previous version of the 029 petition was dismissed simply because the homeowner failed to cite a specific Bylaw, CC&R, or statute. In the administrative arena, specific citations are the only way to get your day in court.

Homeowners are encouraged to audit their own association's fee and penalty structures against ARIZ. REV. STAT. § 33-1803. If your late fees exceed $15 or 10%, your HOA may be operating outside the law.

Case Participants

Petitioner Side

Warren R. Brown (petitioner)
Petitioner in docket Nos. 18F-H1818029-REL-RHG and 18F-H1818045-REL; appeared on his own behalf
Brad W. Stevens (petitioner)
Petitioner in docket No. 18F-H1818054-REL; appeared on his own behalf

Respondent Side

Gregory A. Stein (respondent attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Attorney for Respondent Mogollon Airpark, Inc.
Mark K. Sahl (respondent attorney)
Carpenter, Hazlewood, Delgado & Bolen LLP
Attorney for Respondent Mogollon Airpark, Inc.

Neutral Parties

Thomas Shedden (ALJ)
Office of Administrative Hearings
Administrative Law Judge presiding over the consolidated hearing
Judy Lowe (Commissioner)
Arizona Department of Real Estate
Recipient of the transmitted decision
Felicia Del Sol (clerk)
Office of Administrative Hearings
Transmitted the decision

Brent J Mathews v. American Ranch Community Association

Posted on October 9, 2018 by [email protected]

Case Summary

Case ID	18F-H1818050-REL
Agency	ADRE
Tribunal	OAH
Decision Date	2018-10-11
Administrative Law Judge	Tammy L. Eigenheer
Outcome	The Administrative Law Judge dismissed the Petition because the Petitioner failed to prove the Respondent Board violated the Bylaws. The Board was found to have the necessary authority under Bylaws Section 3.11 to enter into the Well Agreement 2 as a variance, and this action did not constitute an improper amendment of the CC&Rs.
Filing Fees Refunded	$500.00
Civil Penalties	$0.00

Parties & Counsel

Petitioner	Brent J. Mathews	Counsel	—
Respondent	American Ranch Community Association	Counsel	Lynn Krupnik and Timothy Krupnik

Alleged Violations

American Ranch Bylaws, Article 3.11

Outcome Summary

The Administrative Law Judge dismissed the Petition because the Petitioner failed to prove the Respondent Board violated the Bylaws. The Board was found to have the necessary authority under Bylaws Section 3.11 to enter into the Well Agreement 2 as a variance, and this action did not constitute an improper amendment of the CC&Rs.

Why this result: The Board was authorized to grant a variance to the CC&Rs regarding the well on Lot 2, a power delegated to the Association, meaning the Board did not exceed its authority under the Bylaws.

Key Issues & Findings

Alleged violation of the American Ranch Bylaws, Article 3.11, when the Board entered into the 'Well Agreement' (Well Agreement 2).

Petitioner asserted that the Board violated the Bylaws by entering into Well Agreement 2, claiming the Board lacked the authority to grant exceptions or variances to the CC&Rs regarding the use of a private water well on Lot 2. The Board agreed the well existed in violation of CC&Rs Section 3.26, but argued Well Agreement 2 constituted a variance, not an amendment.

Orders: The Petition was dismissed.

Filing fee: $500.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

A.R.S. § 41-2198.01
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
A.A.C. R2-19-119(B)(1)
A.A.C. R2-19-119(B)(2)
A.R.S. § 32-2199.02(B)
A.R.S. § 32-2199.04
A.R.S. § 41-1092.09

Analytics Highlights

Topics: HOA authority, Bylaws 3.11, CC&Rs, Variance, Amendment, Well Agreement, Burden of Proof, Dismissal

Additional Citations:

A.R.S. § 41-2198.01
A.R.S. § 41-1092.07(G)(2)
A.A.C. R2-19-119(A)
A.A.C. R2-19-119(B)(1)
A.A.C. R2-19-119(B)(2)
A.R.S. § 32-2199.02(B)
A.R.S. § 32-2199.04
A.R.S. § 41-1092.09

Video Overview

Audio Overview

Decision Documents

18F-H1818050-REL Decision – 664186.pdf

Uploaded 2026-04-24T11:13:46 (112.4 KB)

18F-H1818050-REL Decision – 664186.pdf

Uploaded 2026-01-23T17:24:56 (112.4 KB)

Briefing Document: Mathews v. American Ranch Community Association

Executive Summary

This briefing document outlines the findings and decision in case number 18F-H1818050-REL, a dispute between Petitioner Brent J. Mathews and the American Ranch Community Association (HOA). The Administrative Law Judge dismissed the petition, concluding that Mr. Mathews failed to prove his allegations by a preponderance of the evidence.

The central issue was whether the HOA’s Board of Directors violated Article 3.11 of its Bylaws by entering into a “Well Agreement” with the owners of Lot 2 on August 9, 2016. The Petitioner argued that this agreement constituted an unauthorized amendment to the community’s Covenants, Conditions, and Restrictions (CC&Rs) because the Board does not have the power to grant exceptions.

The judge found this argument “faulty,” determining that the agreement was not an amendment but a variance. The CC&Rs explicitly grant the authority to issue variances to the Architectural Review Committee. Per the Bylaws, the Board is empowered to exercise any authority delegated to the Association that is not specifically reserved for the general membership. Therefore, the judge concluded that the Board acted within its authority when it executed the agreement. The decision was based on the Board’s need to resolve a problematic prior agreement under time-sensitive circumstances related to a property sale.

1. Case Overview

Case Number

18F-H1818050-REL

Petitioner

Brent J. Mathews

Respondent

American Ranch Community Association

Hearing Date

September 21, 2018

Decision Date

October 11, 2018

Presiding Judge

Administrative Law Judge Tammy L. Eigenheer

The dispute originated from a petition filed by Brent J. Mathews on May 16, 2018, with the Arizona Department of Real Estate. The core of the complaint was an alleged Open Meeting Violation concerning an “Action Outside of Meeting” that resulted in a “Well Agreement” between the Association and homeowners Mark and Diane Kaplan.

2. Petitioner’s Core Allegation

After being directed to clarify his petition to a single issue, Mr. Mathews submitted the following statement on August 23, 2018:

“When the Board entered into the ‘Well Agreement’ they may have assumed they had the power to grant exceptions to the CC&R’s. The American Ranch Community Association Bylaws do not empower the Board to grant exceptions to the CC&R’s. Therefore the single complaint is an alleged violation of the American Ranch Bylaws, Article 3.11.”

The Petitioner’s legal argument was that the Board’s action in creating the “Well Agreement 2” was effectively an amendment of the CC&Rs. According to Section 9.3.1 of the CC&Rs, amendments require the written approval or affirmative vote of 75 percent of the total owners. Since this did not occur, the Petitioner concluded the Board lacked the authority to enter into the agreement.

3. Factual Background and Chronology of Events

The case revolves around a water well on Lot 2 of the American Ranch community, which was installed in violation of the governing documents.

A water well is installed on Lot 2. This installation violates Section 3.26 of the CC&Rs, which prohibits wells on all lots except Equestrian Lots and, even then, only with prior approval from the Architectural Review Committee (ARC) for specific purposes.

June 2011

The owners of Lot 2 and the HOA Board enter into the first “Well and Easement Agreement” (Well Agreement 1). This agreement permitted the continued use of the well for irrigation but required the owners to install a water meter and pay the HOA for water usage at the same rate as the local water district.

November 23, 2013

Lot 2 is sold to Steven and Frances Galliano.

July 30, 2016

Mark and Diane Kaplan, who are in escrow to purchase Lot 2, email the Community Manager, Tiffany Taylor. They express concern over Well Agreement 1 and state they cannot proceed with the purchase without clarity on the HOA’s position. They also note that the Gallianos told them they had never been charged for water from the well.

August 2016

Facing a time-sensitive situation due to the pending property sale, the HOA Board decides to enter into a new agreement to invalidate Well Agreement 1. The Board’s decision was based in part on the belief that it lacked the authority to enter into the original agreement, specifically because it had no power to bill residents for water usage—a function of the water district.

August 9, 2016

The HOA Board and the Kaplans execute a new “Well Agreement” (Well Agreement 2). This agreement permits the continued use of the well for irrigation purposes but explicitly states the owners will not be billed for the water used.

4. Administrative Law Judge’s Findings and Legal Reasoning

The Judge’s decision rested on a critical distinction between a CC&R amendment and a variance, and a detailed analysis of the powers granted to the Board by the governing documents.

A. Burden of Proof

The Petitioner, Brent J. Mathews, bore the burden of proof to establish that the HOA committed the alleged violation by a “preponderance of the evidence.” This standard requires proof that a contention is more probably true than not.

B. Variance vs. Amendment

The central point of the Judge’s legal conclusion was the rejection of the Petitioner’s argument.

• Petitioner’s Argument: Well Agreement 2 was an amendment to the CC&Rs.

• Judge’s Finding: The argument is “faulty.” The decision states, “A variance granted to an individual owner from a restriction under the CC&Rs does not constitute an amendment of the CC&Rs.”

The Judge found that the CC&Rs themselves, in Section 3.31, provide a specific mechanism for granting variances. The ARC is authorized to grant variances in “extenuating circumstances” if a restriction creates an “unreasonable hardship or burden” and the variance does not have a “substantial adverse effect” on the community.

C. The Board’s Delegated Authority

The Judge established a clear chain of authority that empowered the Board to act as it did:

1. CC&R Section 3.31: Delegates the power to grant variances to the Architectural Review Committee.

2. Bylaw Section 3.11.8: States the Board shall have the power to “Exercise for the Association all powers, duties and authority vested in or delegated to the Association and not reserved to the membership by other provisions of the Project Documents.”

3. Conclusion: Because the power to grant variances was delegated to the ARC (and thus to the Association) and not reserved for the membership, the Board had the authority to grant the variance embodied in Well Agreement 2.

5. Final Order

Based on the foregoing analysis, the Administrative Law Judge issued the following order:

• Decision: The Petition filed by Brent J. Mathews is dismissed.

• Reasoning: “Petitioner failed to establish by a preponderance of the evidence that the Board of Directors lacked the authority to enter into Well Agreement 2. Thus, Petitioner failed to sustain his burden to establish a violation of Section 3.11 of the Bylaws.”

The order was finalized and transmitted to the parties on October 11, 2018.

Study Guide: Mathews v. American Ranch Community Association (Case No. 18F-H1818050-REL)

This guide provides a comprehensive review of the Administrative Law Judge Decision in the case between Petitioner Brent J. Mathews and Respondent American Ranch Community Association. It is designed to test and deepen understanding of the facts, legal arguments, and final ruling presented in the source document.

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Short-Answer Quiz

Instructions: Answer the following questions in 2-3 complete sentences based on the information provided in the case document.

1. Who were the primary parties involved in this case, and what were their respective roles?

2. What was the initial, overarching subject of Brent J. Mathews’s complaint filed on May 16, 2018?

3. After being asked to clarify, what single issue did the Petitioner choose to proceed with for the hearing?

4. According to the CC&Rs, what are the specific rules regarding the use of water wells on lots within American Ranch?

5. What were the key terms of “Well Agreement 1,” established in June 2011 with the original owners of Lot 2?

6. Why did the American Ranch Board of Directors believe they lacked the authority to enforce “Well Agreement 1”?

7. What were the terms of “Well Agreement 2,” which was executed on August 9, 2016, with the new owners of Lot 2, the Kaplans?

8. What was Petitioner Mathews’s primary legal argument against the Board’s authority to enter into “Well Agreement 2”?

9. How did the Administrative Law Judge distinguish between a “variance” and an “amendment” to the CC&Rs in the final decision?

10. What was the final order issued by the Administrative Law Judge on October 11, 2018?

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Answer Key

1. The primary parties were Petitioner Brent J. Mathews, who filed the complaint, and Respondent American Ranch Community Association (HOA), which was the subject of the complaint. Mathews represented himself, while the Association was represented by Lynn Krupnik and Timothy Krupnik.

2. The initial complaint’s subject was an “Open Meeting Violation regarding an ‘Action Outside of Meeting’” that took place on August 6, 2016. This action concerned the Association entering into a “Well Agreement” with Mark and Diane Kaplan.

3. The Petitioner clarified his single issue was an alleged violation of the American Ranch Bylaws, Article 3.11. He argued that the Board entered into the “Well Agreement” assuming they had the power to grant exceptions to the CC&Rs, a power he claimed the Bylaws did not grant them.

4. Section 3.26 of the CC&Rs prohibits water wells on all lots except Equestrian Lots. On Equestrian Lots, wells are permitted only with prior written approval from the Architectural Review Committee and must be used solely to irrigate pasture land and provide drinking water for horses.

5. “Well Agreement 1” acknowledged that the owners of Lot 2 were using their well for irrigation in violation of the CC&Rs. The agreement allowed them to continue this use, provided they installed a water meter and paid the Association the same per-gallon charge as other owners paid to the water district.

6. The Board of Directors believed they did not have the authority to enter into “Well Agreement 1” because they had no ability or authority to bill the lot owners for water used from a private well. They reasoned that billing for water was the responsibility of the water district, not the HOA.

7. “Well Agreement 2” stated that the private water well on Lot 2 would continue to be used for irrigation purposes. Crucially, it specified that the owners (the Kaplans) would not be billed for the water used from this well.

8. Petitioner Mathews argued that “Well Agreement 2” constituted an amendment of the CC&Rs. He contended that under Section 9.3.1 of the CC&Rs, an amendment requires the written approval or affirmative vote of 75 percent of the total owners, and therefore the Board acted outside its authority.

9. The Judge ruled that “Well Agreement 2” was a variance granted to an individual owner, not an amendment to the CC&Rs. The CC&Rs specifically provide a method for granting variances via the Architectural Review Committee, and this power is delegated to the Association and thus exercisable by the Board.

10. The final order, issued on October 11, 2018, was that the Petition be dismissed. The Judge concluded that the Petitioner failed to establish by a preponderance of the evidence that the Board of Directors lacked the authority to enter into “Well Agreement 2.”

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Essay Questions

Instructions: The following questions are designed for a more in-depth, essay-style response. Use the case document to construct a thorough and well-supported argument for each prompt. Answers are not provided.

1. Analyze the evolution of the dispute, from the initial installation of the well on Lot 2 to the final Administrative Law Judge Decision. Discuss the key events and agreements (Well Agreement 1 and Well Agreement 2) and explain how each contributed to the legal conflict.

2. Explain the legal reasoning used by the Administrative Law Judge to dismiss the Petitioner’s claim. Detail the specific sections of the Bylaws and CC&Rs cited (3.11, 3.26, 3.31, 9.3.1) and explain the distinction the Judge made between a “variance” and an “amendment.”

3. Discuss the concept of “burden of proof” as it applies to this case. Who held the burden of proof, what was the required standard (“preponderance of the evidence”), and why did the Petitioner ultimately fail to meet this standard?

4. Evaluate the actions of the American Ranch Community Association Board of Directors regarding Lot 2’s well. Discuss their reasoning for invalidating Well Agreement 1 and creating Well Agreement 2, and analyze whether their actions were consistent with the powers granted to them by the community’s governing documents.

5. Based on the procedural history outlined in the “Findings of Fact,” describe the process of an HOA dispute in this jurisdiction, from the initial filing of a petition to the final order from the Office of Administrative Hearings.

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Glossary of Key Terms

Definition

Administrative Law Judge (ALJ)

An official (Tammy L. Eigenheer) who presides over administrative hearings and issues a decision on the matter.

A.R.S. (Arizona Revised Statutes)

The statutory laws of the state of Arizona, sections of which regulate planned communities and the administrative hearing process.

Architectural Review Committee

A body within the Association delegated the authority by the CC&Rs (Section 3.31) to grant variances from certain restrictions in extenuating circumstances.

Board of Directors

The governing body of the American Ranch Community Association, which has the powers and duties necessary for administering the Association’s affairs.

Burden of Proof

The obligation of a party in a legal case to prove their claims. In this case, the Petitioner had the burden to establish the alleged violations.

Bylaws

The rules governing the internal administration of the Association. Petitioner alleged a violation of Bylaw 3.11, which outlines the powers and duties of the Board.

Covenants, Conditions, and Restrictions. These are the governing documents that set rules for properties within the community, such as the prohibition of certain water wells (Section 3.26).

Department

Refers to the Arizona Department of Real Estate, the agency with which the initial Homeowners Association Dispute Process Petition was filed.

Office of Administrative Hearings

An independent state agency to which the Department refers HOA dispute cases for a formal hearing.

Petition

The formal document filed by Brent J. Mathews to initiate the HOA dispute process with the Arizona Department of Real Estate.

Petitioner

The party who brings the legal action or complaint. In this case, Brent J. Mathews.

Preponderance of the Evidence

The standard 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.”

Respondent

The party against whom the petition is filed. In this case, the American Ranch Community Association.

Variance

An officially granted exception from a restriction in the CC&Rs for an individual owner. The Judge determined Well Agreement 2 was a variance, not an amendment.

Well Agreement 1

A June 2011 agreement that allowed the owners of Lot 2 to use a non-compliant well for irrigation, provided they paid the Association for the water.

Well Agreement 2

An August 2016 agreement that invalidated Well Agreement 1 and allowed the new owners of Lot 2 (the Kaplans) to continue using the well for irrigation without being billed for the water.

Your HOA Board Might Be More Powerful Than You Think: 3 Lessons from a Legal Showdown

1.0 Introduction: The Predictable Fight with an Unpredictable Outcome

It’s a scenario familiar to many homeowners: you suspect your Homeowners Association (HOA) board is playing favorites, bending the rules for one resident while holding everyone else to the letter of the law. This feeling of frustration often leads to heated disputes, but what happens when a homeowner decides to take that fight to court? You might expect a simple verdict based on the community’s clear, written rules.

That’s exactly what homeowner Brent J. Mathews thought. He discovered his HOA board had made a special agreement with a neighbor, allowing a water well that clearly violated the community’s governing documents. He filed a formal complaint, arguing the board had illegally overstepped its authority.

The case that followed, however, didn’t turn on one obvious rule. Instead, the judge’s decision hinged on how different governing documents—the CC&Rs and the Bylaws—interact. The outcome reveals some surprising and counter-intuitive truths about where power really lies within an HOA, offering critical lessons for every homeowner.

2.0 Takeaway 1: A Special Exception Isn’t the Same as Changing the Rules for Everyone

Mr. Mathews’ central argument was straightforward and, on its face, perfectly logical. He contended that the board’s “Well Agreement 2” with his neighbor was effectively an amendment to the community’s Covenants, Conditions, and Restrictions (CC&Rs).

According to the community’s CC&Rs (Section 9.3.1), amending the rules is a serious undertaking that requires the written approval of 75 percent of all homeowners. The board clearly did not have this approval, so it seemed to be a clear-cut case of an illegal action. Many homeowners would have made the same reasonable assumption: the board can’t just change the rules on its own.

However, the judge found a critical distinction. The board’s action was not an “amendment”—a permanent change to the rules for the entire community. Instead, it was legally considered a “variance”—a one-time exception granted to a single homeowner. Because the CC&Rs contained a separate, specific process for granting variances (Section 3.31), the board was not illegally rewriting the rulebook; it was simply using a different, pre-existing tool in the governing documents.

3.0 Takeaway 2: The Board Can Wield Powers Given to Its Own Committees

This distinction raised another logical objection. The CC&Rs (Section 3.31) explicitly state that the power to grant variances belongs to the “Architectural Review Committee” (ARC), not the Board of Directors. It appeared Mr. Mathews had found his checkmate: even if the action was a variance, the wrong body had granted it.

This is where the case took its most surprising turn. The judge looked beyond the CC&Rs and consulted a different governing document: the Bylaws. This document contained a foundational clause about the board’s authority that proved decisive.

According to Bylaw 3.11.8, the Board of Directors is empowered to exercise any authority of the Association that is not specifically and exclusively reserved for the members themselves. Since the power to grant variances was delegated to a committee (the ARC) and not reserved for a vote by the general membership, the Board had the authority to step in and exercise that power itself. The judge’s decision made this clear.

“As the power to grant variances was delegated to the Architectural Review Committee and was not reserved to the membership, the Board had the authority to grant such a variance.”

This finding reveals a crucial principle of HOA governance: powers delegated to a committee are not the same as powers reserved for the entire membership. Unless a power is explicitly reserved for a member vote, the Bylaws can grant the Board ultimate authority over it.

4.0 Takeaway 3: A Messy History Can Justify an Unusual Solution

While the legal arguments are complex, the context behind the board’s decision is equally important. The board wasn’t making a special deal out of the blue; it was trying to solve a messy problem it had inherited.

The well on Lot 2 was originally installed around 2007 in violation of Section 3.26 of the CC&Rs. The board’s first attempt to fix this, “Well Agreement 1” in or about June 2011, allowed the well’s use but required the owner to pay the association for the water consumed. This arrangement, however, was deeply flawed.

When new buyers (the Kaplans) were in escrow to purchase the property in 2016, the situation came to a head. The Kaplans discovered the unusual agreement and informed the board they would be “unable to proceed with the purchase” unless its status was clarified. With the real estate deal on the line, the board recognized that “time was of the essence.”

The board’s decision to execute “Well Agreement 2” was driven by two realities. First, they believed the original agreement was legally invalid, as the board had no authority to bill a resident for water. Second, the agreement was a failure in practice; the Kaplans had been told by the prior owners that “they had never been charged for the water used from the well.” Facing an unenforceable and un-enforced agreement that was now threatening a home sale, the board acted pragmatically to resolve the decade-old violation once and for all.

5.0 Conclusion: Know the Rules—And Who Has the Power to Bend Them

The core lesson from this case is that HOA governance is a complex web of interlocking documents. The rules you read in the CC&Rs might not tell the whole story. Power and authority can be defined, and even transferred, by provisions buried in the Bylaws or other governing texts. What may seem like an obvious violation can be justified by a clause a homeowner might easily overlook.

This case is a powerful reminder for every homeowner. It’s not enough to know the rules of your community. You also need to understand the system of governance that enforces, interprets, and sometimes, grants exceptions to them. It prompts a critical question: Do you know not just the rules in your community, but who really has the authority to grant exceptions?

Case Participants

Petitioner Side

Brent J. Mathews (petitioner)
Appeared on his own behalf

Respondent Side

Lynn Krupnik (attorney)
Krupnik & Speas, PLLC
Represented Respondent
Timothy Krupnik (attorney)
Krupnik & Speas, PLLC
Represented Respondent
Tiffany Taylor (community manager)
American Ranch Community Association
Testified for Respondent
Brad Baker (board member)
American Ranch Community Association
Respondent Vice President; testified at hearing

Neutral Parties

Tammy L. Eigenheer (ALJ)
OAH
Judy Lowe (commissioner)
Arizona Department of Real Estate
Felicia Del Sol (administrative staff)
Signed transmission page
LDettorre (ADRE staff)
Arizona Department of Real Estate
Decision recipient
AHansen (ADRE staff)
Arizona Department of Real Estate
Decision recipient
djones (ADRE staff)
Arizona Department of Real Estate
Decision recipient
DGardner (ADRE staff)
Arizona Department of Real Estate
Decision recipient
ncano (ADRE staff)
Arizona Department of Real Estate
Decision recipient

Other Participants

Mark Kaplan (owner)
Lot 2
Executed Well Agreement 2
Diane Kaplan (owner)
Lot 2
Executed Well Agreement 2
Steven Galliano (former owner)
Lot 2
Frances Galliano (former owner)
Lot 2

Case Summary

Parties & Counsel

Alleged Violations

Outcome Summary

Key Issues & Findings

Alleged violation of community documents and statutes regarding parking ban and vehicle booting/towing

Analytics Highlights

Video Overview

Audio Overview

Decision Documents

19F-H1918019-REL Decision – 703187.pdf

19F-H1918019-REL Decision – 678471.pdf

19F-H1918019-REL Decision – 678471.pdf

19F-H1918019-REL Decision – 703187.pdf

Administrative Hearing Briefing: William P. Lee v. Greenlaw Townhouses Unit Two

Executive Summary

Case Overview

Petitioner’s Core Allegations and Arguments

Respondent’s Defense

Analysis of Key Governing Documents

Administrative Law Judge’s Findings and Conclusions

Burden of Proof

Key Conclusions of Law

Final Order and Implications

Study Guide: Lee v. Greenlaw Townhouses Unit Two (Case No. 19F-H1918019-REL-RHG)

Case Overview

Key Parties and Roles

Timeline of Key Events

The Central Conflict: Parking Regulations

Governing Documents and Legal Principles

The Judge’s Decision and Rationale

Quiz: Test Your Understanding

Answer Key

Essay Questions for Deeper Analysis

Glossary of Key Terms

19F-H1918019-REL-RHG

Case Participants

Petitioner Side

Respondent Side

Neutral Parties

Case Summary

Parties & Counsel

Alleged Violations

Outcome Summary

Key Issues & Findings

Alleged violation of CC&Rs § 3.10 by failing to require unit owners to remove vegetation and fencing materials from the stormwater channel behind their homes.

Analytics Highlights

Video Overview

Audio Overview

Decision Documents

19F-H1918010-REL Decision – 706533.pdf

19F-H1918010-REL Decision – 707530.pdf

19F-H1918010-REL Decision – 667122.pdf

19F-H1918010-REL Decision – 678371.pdf

19F-H1918010-REL Decision – 667122.pdf

19F-H1918010-REL Decision – 678371.pdf

Briefing Document: Sellers vs. Rancho Madera Condominium Association

Executive Summary

Case Chronology and Procedural History

Core Dispute Analysis

Petitioner’s Position and Allegations

Respondent’s Position and Actions

Key CC&R Provisions and Legal Interpretation

Judicial Findings and Rulings

Initial Decision (ALJ Diane Mihalsky, Dec 26, 2018)

Rehearing Decision (ALJ Tammy L. Eigenheer, May 10, 2019)

Notable Evidence

Study Guide for Case No. 19F-H1918010-REL: Sellers v. Rancho Madera Condominium Association

Short-Answer Quiz

Answer Key

Suggested Essay Questions

Glossary of Key Terms

I Read an Entire HOA Lawsuit. Here Are 4 Shocking Lessons About Power, Rules, and Reality.

The Anatomy of a Neighborhood War

1. Proving a Rule Was Broken Isn’t the Same as Proving Harm

2. An HOA’s “Right” to Enforce Is Not an “Obligation”

3. Outside Conflicts Can Cast a Long Shadow

4. Writing Letters Isn’t the Same as Being Heard

A Cautionary Tale for Any Homeowner

Case Participants