Case Summary
| Case ID | 17F-H1716023-REL |
|---|---|
| Agency | ADRE |
| Tribunal | OAH |
| Decision Date | 2017-05-16 |
| Administrative Law Judge | Tammy L. Eigenheer |
| Outcome | no |
| Filing Fees Refunded | $0.00 |
| Civil Penalties | $0.00 |
Parties & Counsel
| Petitioner | Barry Saxion | Counsel | — |
|---|---|---|---|
| Respondent | Silverton II Homeowners Association, Inc. | Counsel | Troy B. Stratman, Esq. |
Alleged Violations
Declaration Section 12.1
Outcome Summary
The Commissioner of the Department of Real Estate accepted the ALJ Decision, ordering the petition be dismissed because the governing documents require the claim be handled through internal dispute resolution prior to administrative action.
Why this result: Petitioner failed to use the mandatory dispute resolution procedures set forth in the Declaration before filing the administrative action.
Key Issues & Findings
Requirement for mandatory dispute resolution procedures
The Petition was dismissed because the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II requires that all covered claims must be resolved using internal dispute resolution procedures in lieu of initiating administrative proceedings.
Orders: The ALJ recommended that the Petition be dismissed, and the Commissioner accepted the ALJ decision.
Filing fee: $0.00, Fee refunded: No
Disposition: respondent_win
- Declaration Section 12.1
- A.R.S. § 41-1092.08
Analytics Highlights
- Declaration Section 12.1
- A.R.S. § 41-1092.08
Audio Overview
Decision Documents
17F-H1716023-REL Decision – 564668.pdf
17F-H1716023-REL Decision – 564672.pdf
17F-H1716023-REL Decision – 568837.pdf
Briefing on Case No. 17F-H1716023-REL: Saxion vs. Silverton II HOA
Executive Summary
This briefing details the administrative proceedings and final disposition of the case involving petitioners Barry and Sandra Saxion and respondent Silverton II Homeowners Association, Inc. The petition was ultimately dismissed by the Arizona Department of Real Estate, which adopted the recommendation of an Administrative Law Judge (ALJ). The dismissal was based on a procedural failure by the petitioners to adhere to the mandatory dispute resolution process outlined in the HOA’s governing documents before initiating administrative action.
The respondent’s motion for dismissal presented two primary arguments. The first, challenging petitioner Barry Saxion’s standing due to non-ownership of property, was denied by the ALJ, who found that co-petitioner Sandra Saxion did own property and had standing. The second, and decisive, argument was that the HOA’s Declaration explicitly requires all “covered claims” to be resolved through its internal dispute resolution procedures in lieu of administrative proceedings. The ALJ agreed with this argument, leading to a recommendation for dismissal, the vacating of a scheduled hearing, and the issuance of a final order confirming the dismissal.
Case Overview
This section outlines the primary participants, key identifiers, and procedural timeline of the administrative action.
Affiliation
Petitioner
Barry Saxion
Petitioner
Sandra Saxion
Property owner within the Association
Respondent
Silverton II Homeowners Association, Inc.
Adjudicator
Tammy L. Eigenheer
Administrative Law Judge, Office of Administrative Hearings
Final Authority
Judy Lowe
Commissioner, Arizona Department of Real Estate
Respondent’s Counsel
Troy B. Stratman, Esq.
Stratman Law Firm, PLC
Identifier
Case Number
HO 17-16/023
Docket Number
17F-H1716023-REL
Jurisdiction
Office of Administrative Hearings (OAH), Phoenix, Arizona
Referring Body
Arizona Department of Real Estate (Department)
• Petition Filed: Both Barry and Sandra Saxion signed a Homeowners Association (HOA) Dispute Process Petition.
• Referral to OAH: The Department of Real Estate referred the matter to the Office of Administrative Hearings, creating the caption Barry Saxion v. Silverton II Homeowners Association, Inc.
• Motion for Summary Judgment: The Respondent HOA filed a motion to dismiss the petition.
• May 16, 2017: Administrative Law Judge Tammy L. Eigenheer issued a decision recommending the petition be dismissed.
• May 16, 2017: A Minute Entry was issued, vacating the hearing scheduled for May 22, 2017, based on the dismissal recommendation.
• May 30, 2017: The Commissioner of the Department of Real Estate, Judy Lowe, issued a Final Order adopting the ALJ’s decision and officially dismissing the petition.
Analysis of the Motion for Summary Judgment
The Silverton II HOA’s Motion for Summary Judgment was the pivotal filing in this case. It presented two distinct arguments for dismissal, which were addressed separately by the Administrative Law Judge.
Respondent’s Arguments
1. Lack of Standing: The initial argument was that the petitioner, identified in the case caption as Barry Saxion, did not own property within the Association and therefore lacked the legal standing necessary to pursue the action.
2. Failure to Adhere to Governing Documents: The second argument was that the petition must be dismissed because it violated the procedural requirements set forth in the HOA’s governing documents. Specifically, Section 12.1 of the Declaration of Homeowners Benefits and Covenants, Conditions, and Restrictions for Silverton II (the “Declaration”) mandates a specific internal dispute resolution process for all “covered claims.”
Administrative Law Judge’s Decision
The ALJ’s decision, issued on May 16, 2017, analyzed both of the respondent’s arguments and made distinct recommendations for each.
• The ALJ recommended that the motion to dismiss be denied on the grounds of standing.
• The judge acknowledged the fact, undisputed by the petitioner, that Barry Saxion does not own property within the association.
• However, the judge’s review of the original HOA Dispute Process Petition revealed that Sandra Saxion, who does own property, had also signed the petition as a petitioner. The judge concluded that the case caption, which named only Barry Saxion, was an administrative creation by the Department of Real Estate upon referral.
• The finding was that Sandra Saxion clearly “has standing to pursue this action,” thereby nullifying the argument for dismissal based on a lack of standing.
• The ALJ recommended that the petition be dismissed for failing to follow the mandatory dispute resolution procedures outlined in the HOA’s Declaration.
• The judge cited Section 12.1 of the Declaration, which defines “covered claims” as “all claims, grievances, controversies, disagreements, or disputes that arise in whole or part out of . . . the interpretation, application, or enforcement of the Declaration or the other Project Documents.”
• The judge found that the current dispute fell squarely within this definition.
• The decision states that the “plain language of the Declaration prevents this dispute… to be brought in the Office of Administrative Hearings and mandates that the dispute must be handled through the dispute resolution process set forth in the Declaration and Bylaws.”
• The conclusion was that the petition was improperly filed, as the internal remedies had not been pursued first.
Final Disposition and Subsequent Actions
The ALJ’s recommendation to dismiss directly led to the final resolution of the case.
Vacating of Hearing
A Minute Entry dated May 16, 2017, formally vacated the hearing that was scheduled for May 22, 2017. The order was a direct result of the ALJ’s decision recommending the complaint be dismissed.
Final Order from the Department of Real Estate
On May 30, 2017, Judy Lowe, the Commissioner of the Department of Real Estate, issued a Final Order that officially concluded the matter.
• Adoption of ALJ Decision: The Order explicitly states, “The Commissioner accepts the ALJ decision that the petition in this matter be dismissed as the applicable governing documents require that the claim must be handled through the dispute resolution process prior to administrative proceedings being brought.”
• Effective Date: The Order was designated a “final administrative action” and was effective immediately from the date of service.
• Appellate Rights: The parties were informed of their right to file for a rehearing or review within 30 days of the order. They were also advised of their right to appeal for a judicial review by filing a complaint pursuant to Arizona Revised Statutes Title 12, Chapter 7, Article 6. A court-obtained stay would be required to delay the order during a judicial review.
Official Communications
The Final Order and related documents were formally transmitted to all parties of record via certified mail or electronic means on May 30, 2017. Recipients included:
• Barry Saxion
• Troy B. Stratman, Esq. (counsel for the HOA)
• The Office of Administrative Hearings
• Judy Lowe and other staff at the Arizona Department of Real Estate