Tag Archives: A.R.S. § 32-2199.01

John Shields vs. Will Rogers Equestrian Ranch

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Case Summary

Case ID 17F-H1717034-REL-RHG
Agency ADRE
Tribunal OAH
Decision Date 2018-02-26
Administrative Law Judge Tammy L. Eigenheer
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner John L. Shields Counsel —
Respondent Will Rogers Equestrian Ranch Counsel Maria R. Kupillas

Alleged Violations

CC&R § 6.2(A)

Outcome Summary

The Administrative Law Judge dismissed the petition, finding that the Petitioner failed to prove the HOA violated its CC&Rs by approving the wall extension, as the HOA’s approval duties were limited to aesthetic considerations under CC&R § 7.2 and did not extend to enforcing or ensuring adjoining owner approval required by CC&R § 6.2(A).

Why this result: Petitioner failed to establish by a preponderance of the evidence that Respondent erroneously approved the proposal, as Respondent's duties under CC&R § 7.2 did not require considering adjoining neighbor approval specified in CC&R § 6.2(A).

Key Issues & Findings

Alleged violation of CC&Rs by HOA improperly approving a neighbor's block wall extension without adjoining owner's approval.

Petitioner alleged that the Respondent HOA violated CC&R § 6.2(A) by approving a neighbor's block wall extension that served as a party wall because Petitioner, the adjoining owner, had not approved the wall. Respondent argued their approval duties under CC&R § 7.2 only concerned aesthetics, not ensuring neighbor approval.

Orders: The petition is dismissed and no action is required of Respondent.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199.01
  • CC&R § 6.2(A)
  • CC&R § 7.2

Analytics Highlights

Topics: HOA, CC&R, Architectural Control Committee, Fence, Party Wall, Rehearing, Burden of Proof
Additional Citations:

  • A.R.S. § 32-2199.01
  • A.A.C. R2-19-119(A)
  • A.A.C. R2-19-119(B)(1)
  • A.A.C. R2-19-119(B)(2)
  • Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952)
  • A.R.S. § 32-2199.02(B)
  • A.R.S. § 41-1092.08(H)
  • A.R.S. § 12-904(A)

Audio Overview

Decision Documents

17F-H1717034-REL Decision – 619560.pdf

Uploaded 2025-10-08T06:51:19 (90.8 KB)





Briefing Doc – 17F-H1717034-REL


Briefing Document: Analysis of Administrative Law Judge Decision in Shields v. Will Rogers Equestrian Ranch

Executive Summary

This document synthesizes the findings from the Administrative Law Judge Decision in Case No. 17F-H1717034-REL-RHG, dated February 26, 2018. The central issue was a petition filed by homeowner John L. Shields against the Will Rogers Equestrian Ranch Homeowners’ Association (HOA), alleging the HOA improperly approved a wall extension built by his neighbor, Joe Johnson, without Mr. Shields’ required consent.

The petition was ultimately dismissed. The Administrative Law Judge (ALJ) concluded that the petitioner, Mr. Shields, failed to establish by a preponderance of the evidence that the HOA had violated its Covenants, Conditions, and Restrictions (CC&Rs). The decision rests on a critical distinction between the responsibilities of a homeowner and the responsibilities of the HOA under separate articles of the CC&Rs. The ALJ determined that the obligation to secure an adjoining neighbor’s approval for a wall alteration (under CC&R § 6.2) falls exclusively on the homeowner undertaking the project. In contrast, the HOA’s duty (under CC&R § 7.2) is limited to an aesthetic review of the proposed alteration, which it conducted appropriately. The HOA had no legal obligation to enforce or verify neighbor-to-neighbor approval.

I. Case Overview

Case Name

John L. Shields (Petitioner) vs. Will Rogers Equestrian Ranch (Respondent)

Case Number

17F-H1717034-REL-RHG

Jurisdiction

Office of Administrative Hearings, Phoenix, Arizona

Presiding Judge

Administrative Law Judge Tammy L. Eigenheer

Date of Decision

February 26, 2018

Core Dispute

The petitioner alleged the HOA violated CC&R § 6.2(A) by approving a neighbor’s approximately 5’ x 6’ block wall extension without the petitioner’s consent.

Final Outcome

The petition was dismissed, with no action required of the respondent HOA.

II. Petitioner’s Claim and Arguments

John L. Shields, a homeowner at 20431 E. Bronco Drive within the Will Rogers Equestrian Ranch development, filed a petition against the HOA concerning a wall extension built by his next-door neighbor, Joe Johnson.

• Core Allegation: After vacillating on the specifics of his complaint during the hearing, Mr. Shields firmly asserted that his single issue was that the HOA improperly approved Mr. Johnson’s proposal to build a block wall extension and move his gate forward.

• Basis of Claim: The petitioner argued that under CC&R § 6.2, the HOA should have withheld its approval because Mr. Johnson had not demonstrated that he had first obtained Mr. Shields’ approval for the wall extension between their properties.

• Evidence and Testimony: Mr. Shields denied ever having approved the wall. He submitted a photograph he had taken from his front porch and testified that the block wall extension “was an eyesore.”

III. Respondent’s Position and Evidence

The Will Rogers Equestrian Ranch HOA, represented by board president Kristi Hancock, denied all complaint items and argued its actions were consistent with the governing CC&Rs.

• Basis of Approval: The HOA contended that its approval was based solely on the criteria outlined in CC&R § 7.2. The board, acting as the Architectural Control Committee, reviewed Mr. Johnson’s proposal for its aesthetic qualities and consistency with other properties in the development.

• Aesthetic Review: Ms. Hancock testified that the board inspected other wall extensions and gates and found Mr. Johnson’s proposal to be “aesthetically pleasing and consistent with the other properties.”

• Neighbor Consent Issue: The HOA acknowledged its awareness of Mr. Shields’ objection to the wall after it was built. However, Ms. Hancock testified that the board’s understanding of whether Mr. Shields had approved the wall before construction was unclear. She stated that “at least four witnesses had stated that they heard Petitioner either actually approve of or fail to state an objection to the block wall extension while, in Petitioner’s presence, Mr. Johnson discussed having the block wall extension built.”

• Separation of Duties: The HOA’s position was that its duty under § 7.2 was distinct from the homeowner’s duty under § 6.2. The HOA was not responsible for obtaining or verifying neighbor approval.

IV. Chronology of Key Events

1. October 13, 2016 (approx.): Mr. Johnson has the block wall extension built without first obtaining approval from the HOA’s board or committee.

2. October 16, 2016 (approx.): Mr. Shields expresses his disapproval of the newly built wall to Mr. and Mrs. Johnson.

3. November 2, 2016 (approx.): Mr. Johnson retroactively submits his proposal for the wall extension and a plan to move his gate forward to the Architectural Control Committee for approval.

4. November 2016: The HOA’s newly elected board meets as the Committee and verbally approves Mr. Johnson’s wall but advises him that “he will need to seek neighboring property owner’s approval.”

5. January 2017: The board formally approves Mr. Johnson’s proposal for the wall extension and gate move.

6. May 3, 2017 (approx.): Mr. Shields files a single-issue petition with the Arizona Department of Real Estate.

7. September 27, 2017: An initial hearing is held, and Administrative Law Judge Diane Mihalsky dismisses the petition.

8. December 5, 2017: The Real Estate Commissioner grants Mr. Shields’ request for a rehearing based on his claims of legal errors and judicial misconduct.

9. February 5, 2018: A rehearing is held before Administrative Law Judge Tammy L. Eigenheer.

V. Analysis of Covenants, Conditions, and Restrictions (CC&Rs)

The judge’s decision hinged on the distinct and separate functions of two key CC&R sections.

This section governs alterations to shared fences and walls.

Such Party Walls and Fences shall not be altered, or changed in design, color, material or construction from the original installation made by the Developer without [the] approval of the adjoining Owner(s), if any, and the [Architectural Control] Committee.

• Interpretation: The ALJ interpreted this section as creating two separate approval requirements for the homeowner making the alteration: one from the adjoining owner and one from the Committee. It does not obligate the Committee to enforce the adjoining owner’s approval.

This section defines the scope and limits of the Architectural Control Committee’s power.

No . . . fences . . . shall be commenced [or] erected . . . until the plans and specifications showing the same shall have been submitted to and approved by the Committee. Approval shall not be unreasonably withheld. However, the Committee shall have the right to refuse to approve any Alteration which is not suitable or desirable in their opinion for aesthetic or other reasons…

• Interpretation: The ALJ found that this section limits the Committee’s review to specific criteria, including aesthetics, harmony with surroundings, and effect on neighboring property. It explicitly states that approval “shall not be unreasonably withheld” and does not require the Committee to verify compliance with other CC&Rs or city ordinances.

VI. Judge’s Conclusions of Law and Rationale for Dismissal

The ALJ’s decision to dismiss the petition was based on a clear legal interpretation of the CC&Rs and the petitioner’s failure to meet the burden of proof.

• Distinct and Separate Obligations: The core of the ruling is that the CC&Rs create parallel but separate responsibilities.

1. Homeowner’s Responsibility: The duty to obtain an adjoining neighbor’s approval for a shared wall alteration under § 6.2(A) rests solely with the homeowner performing the work (Mr. Johnson).

2. HOA’s Responsibility: The HOA’s duty under § 7.2 is limited to reviewing the project on its aesthetic merits and consistency within the community.

• Key Legal Finding: The decision explicitly states the separation of these duties:

• Scope of HOA Review: The ALJ affirmed that the HOA’s scope of review was properly limited.

• Failure to Meet Burden of Proof: Because the HOA acted within the authority and limitations defined by CC&R § 7.2, the petitioner failed to prove by a preponderance of the evidence that the HOA had violated its governing documents.

• Other Responsibilities: The decision also noted that the responsibility for ensuring compliance with City of Queen Creek ordinances (related to the gate move) ultimately rested with Mr. Johnson, not the HOA.

VII. Final Order

Based on the findings of fact and conclusions of law, the Administrative Law Judge ordered that the petition be dismissed.

• No action is required of the Respondent, Will Rogers Equestrian Ranch HOA.

• The decision, issued as a result of a rehearing, is binding on the parties.

• Any appeal must be filed with the superior court within thirty-five days from the date the order was served.


Jerry Wheeler vs. Beaver Dam Estates Homeowners Association

Posted on by

Case Summary

Case ID 18F-H1717036-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-09-06
Administrative Law Judge Suzanne Marwil
Outcome full
Filing Fees Refunded $500.00
Civil Penalties $250.00

Parties & Counsel

Petitioner Jerry Wheeler Counsel —
Respondent Beaver Dam Estates Homeowners Association Counsel —

Alleged Violations

A.R.S. § 33-1804(B)

Outcome Summary

The Petitioner's petition was granted. The Administrative Law Judge found that the Respondent HOA violated A.R.S. § 33-1804(B) by failing to hold the required annual meeting for several years. The Respondent was ordered to hold a meeting, refund the filing fee to the Petitioner, and pay a $250.00 civil penalty.

Key Issues & Findings

Failure to hold required annual meeting

Petitioner, a homeowner, alleged the HOA had not held an annual meeting since April 1, 2014, violating A.R.S. § 33-1804(B). The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting for several years.

Orders: Petitioner's petition was granted. Respondent was ordered to hold a meeting in accordance with the planned community statutes as currently scheduled on December 28, 2017. Respondent was ordered to pay the filing fee to the Petitioner pursuant to A.R.S. § 32-2199.02(A), and pay a $250.00 civil penalty to the planned community hearing office fund.

Filing fee: $500.00, Fee refunded: Yes, Civil penalty: $250.00

Disposition: petitioner_win

Cited:

  • A.R.S. § 33-1804(B)
  • A.R.S. § 32-2199.02(A)
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.05

Analytics Highlights

Topics: HOA annual meeting violation, statutory requirement, default judgment
Additional Citations:

  • A.R.S. § 33-1804
  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.R.S. § 32-2199.05
  • A.A.C. R2-19-119(B)
  • A.A.C. R2-19-119(A)

Audio Overview

Decision Documents

18F-H1717036-REL Decision – 586602.pdf

Uploaded 2025-10-08T06:51:57 (65.3 KB)

18F-H1717036-REL Decision – 588549.pdf

Uploaded 2025-10-08T06:51:57 (592.6 KB)





Briefing Doc – 18F-H1717036-REL


Administrative Hearing Briefing: Wheeler v. Beaver Dam Estates Homeowners Association

Executive Summary

This briefing document synthesizes the findings and orders from the case of Jerry Wheeler versus the Beaver Dam Estates Homeowners Association (HOA). The central issue was the HOA’s failure to conduct annual meetings as legally required by Arizona state law. The petitioner, Jerry Wheeler, provided uncontested evidence that the HOA had not held a meeting for several years, specifically since his tenure began on April 1, 2014.

The case was complicated by the death of the HOA’s president prior to the hearing and the association’s subsequent failure to appoint a new representative or appear at the proceedings. The Administrative Law Judge (ALJ) conducted the hearing in the respondent’s absence and ruled decisively in favor of the petitioner.

The final judgment, adopted by the Arizona Department of Real Estate, found the Beaver Dam Estates HOA in violation of A.R.S. § 33-1804(B). The HOA was ordered to hold a meeting on a specified date, reimburse the petitioner’s filing fee, and pay a civil penalty of $250.00 for the violation.

Case Overview

The matter was initiated by a petition filed with the Arizona Department of Real Estate and was subsequently referred to the Office of Administrative Hearings for a formal hearing and decision.

Case Detail

Information

Petitioner

Jerry Wheeler

Respondent

Beaver Dam Estates Homeowners Association

Case Number (OAH)

18F-H1717036-REL

Case Number (Dept. of Real Estate)

HO 17-17/036

Petition Filed

June 8, 2017

Hearing Date

September 5, 2017

ALJ Decision Date

September 6, 2017

Final Order Date

September 13, 2017

Presiding Judge

Suzanne Marwil, Administrative Law Judge (ALJ)

Adopting Authority

Judy Lowe, Commissioner, Arizona Department of Real Estate

Petitioner’s Allegations and Evidence

The petitioner’s case was built on the central allegation that the Beaver Dam Estates HOA had failed to comply with its statutory duty to hold annual meetings.

• Core Allegation: The HOA was in violation of Arizona Revised Statutes (A.R.S.) § 33-1804(B), which mandates that a members’ association meeting “shall be held at least once each year.”

• Petitioner Testimony: Jerry Wheeler testified that since moving into the community on April 1, 2014, the HOA had not held a single meeting. He also testified regarding his numerous efforts to compel the HOA president, Randy Hawk, to convene a meeting for the purpose of reviewing the association’s financial statements with homeowners.

• Supporting Evidence: The petitioner submitted numerous written statements from other homeowners within the Beaver Dam Estates community. These statements corroborated his testimony, confirming that no HOA meeting had been held for several years. This evidence was referred to as “Exhibit B” in the proceedings.

Respondent’s Actions and Procedural Failures

The respondent’s engagement with the legal process was minimal and ultimately ceased, leading to a judgment in its absence.

• Initial Response: The HOA’s then-president, Randy Hawk, initially responded to the petition by agreeing to hold a meeting.

• First Meeting Attempt: A meeting was scheduled for July 18, 2017. However, only about ten people attended, prompting Hawk to reschedule for December 28, 2017. A letter was sent to all members notifying them of the new date and the intent to hold an election for a new president and vice president.

• Death of Representative: The petitioner subsequently informed the Tribunal that Randy Hawk had passed away, leaving the HOA without a clear representative for the legal matter.

• Failure to Appoint New Representative: On August 16, 2017, the Tribunal issued an order, mailed to the respondent’s address of record, requesting that the HOA name a new representative. The HOA failed to do so.

• Failure to Appear: The respondent did not appear for the scheduled hearing on September 5, 2017, nor did it request to appear telephonically. After a 20-minute grace period, the ALJ proceeded with the hearing in the respondent’s absence.

Legal Framework and Conclusions of Law

The ALJ’s decision was based on a clear statutory requirement and the uncontested evidence presented by the petitioner. The burden of proof was on the petitioner, with the standard of proof being a preponderance of the evidence.

• Statutory Violation: The central finding was that the respondent violated A.R.S. § 33-1804(B). The pertinent text of the statute states:

• Key Conclusion: The ALJ determined that “The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting of Respondent for several years prior to the filing of the petition.”

• Recommended Action: Based on this conclusion, the ALJ stated that the respondent “should hold an annual meeting in accordance with the planned community statutes.”

Final Order and Penalties

The ALJ’s decision was formally adopted by the Commissioner of the Department of Real Estate, making it a binding Final Order. The order mandated several actions by the respondent.

IT IS ORDERED that:

1. The petitioner’s petition is granted.

2. The respondent must hold a meeting in accordance with planned community statutes as scheduled on December 28, 2017.

3. Pursuant to A.R.S. § 32-2199.02(A), the respondent shall pay the petitioner the filing fee required by section 32-2199.01.

4. The respondent shall pay to the planned community hearing office fund a civil penalty of $250.00 for the violation.

This Final Order was declared a final administrative action, effective immediately upon service on September 13, 2017. The parties were notified of their right to apply for a rehearing within thirty days or to appeal the decision by filing a complaint for judicial review.


Jerry Wheeler vs. Beaver Dam Estates Homeowners Association

Posted on by

Case Summary

Case ID 18F-H1717036-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-09-06
Administrative Law Judge Suzanne Marwil
Outcome full
Filing Fees Refunded $500.00
Civil Penalties $250.00

Parties & Counsel

Petitioner Jerry Wheeler Counsel —
Respondent Beaver Dam Estates Homeowners Association Counsel —

Alleged Violations

A.R.S. § 33-1804(B)

Outcome Summary

The Petitioner's petition was granted. The Administrative Law Judge found that the Respondent HOA violated A.R.S. § 33-1804(B) by failing to hold the required annual meeting for several years. The Respondent was ordered to hold a meeting, refund the filing fee to the Petitioner, and pay a $250.00 civil penalty.

Key Issues & Findings

Failure to hold required annual meeting

Petitioner, a homeowner, alleged the HOA had not held an annual meeting since April 1, 2014, violating A.R.S. § 33-1804(B). The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting for several years.

Orders: Petitioner's petition was granted. Respondent was ordered to hold a meeting in accordance with the planned community statutes as currently scheduled on December 28, 2017. Respondent was ordered to pay the filing fee to the Petitioner pursuant to A.R.S. § 32-2199.02(A), and pay a $250.00 civil penalty to the planned community hearing office fund.

Filing fee: $500.00, Fee refunded: Yes, Civil penalty: $250.00

Disposition: petitioner_win

Cited:

  • A.R.S. § 33-1804(B)
  • A.R.S. § 32-2199.02(A)
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.05

Analytics Highlights

Topics: HOA annual meeting violation, statutory requirement, default judgment
Additional Citations:

  • A.R.S. § 33-1804
  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.R.S. § 32-2199.05
  • A.A.C. R2-19-119(B)
  • A.A.C. R2-19-119(A)

Audio Overview

Decision Documents

18F-H1717036-REL Decision – 586602.pdf

Uploaded 2025-10-09T03:31:53 (65.3 KB)

18F-H1717036-REL Decision – 588549.pdf

Uploaded 2025-10-09T03:31:53 (592.6 KB)





Briefing Doc – 18F-H1717036-REL


Administrative Hearing Briefing: Wheeler v. Beaver Dam Estates Homeowners Association

Executive Summary

This briefing document synthesizes the findings and orders from the case of Jerry Wheeler versus the Beaver Dam Estates Homeowners Association (HOA). The central issue was the HOA’s failure to conduct annual meetings as legally required by Arizona state law. The petitioner, Jerry Wheeler, provided uncontested evidence that the HOA had not held a meeting for several years, specifically since his tenure began on April 1, 2014.

The case was complicated by the death of the HOA’s president prior to the hearing and the association’s subsequent failure to appoint a new representative or appear at the proceedings. The Administrative Law Judge (ALJ) conducted the hearing in the respondent’s absence and ruled decisively in favor of the petitioner.

The final judgment, adopted by the Arizona Department of Real Estate, found the Beaver Dam Estates HOA in violation of A.R.S. § 33-1804(B). The HOA was ordered to hold a meeting on a specified date, reimburse the petitioner’s filing fee, and pay a civil penalty of $250.00 for the violation.

Case Overview

The matter was initiated by a petition filed with the Arizona Department of Real Estate and was subsequently referred to the Office of Administrative Hearings for a formal hearing and decision.

Case Detail

Information

Petitioner

Jerry Wheeler

Respondent

Beaver Dam Estates Homeowners Association

Case Number (OAH)

18F-H1717036-REL

Case Number (Dept. of Real Estate)

HO 17-17/036

Petition Filed

June 8, 2017

Hearing Date

September 5, 2017

ALJ Decision Date

September 6, 2017

Final Order Date

September 13, 2017

Presiding Judge

Suzanne Marwil, Administrative Law Judge (ALJ)

Adopting Authority

Judy Lowe, Commissioner, Arizona Department of Real Estate

Petitioner’s Allegations and Evidence

The petitioner’s case was built on the central allegation that the Beaver Dam Estates HOA had failed to comply with its statutory duty to hold annual meetings.

• Core Allegation: The HOA was in violation of Arizona Revised Statutes (A.R.S.) § 33-1804(B), which mandates that a members’ association meeting “shall be held at least once each year.”

• Petitioner Testimony: Jerry Wheeler testified that since moving into the community on April 1, 2014, the HOA had not held a single meeting. He also testified regarding his numerous efforts to compel the HOA president, Randy Hawk, to convene a meeting for the purpose of reviewing the association’s financial statements with homeowners.

• Supporting Evidence: The petitioner submitted numerous written statements from other homeowners within the Beaver Dam Estates community. These statements corroborated his testimony, confirming that no HOA meeting had been held for several years. This evidence was referred to as “Exhibit B” in the proceedings.

Respondent’s Actions and Procedural Failures

The respondent’s engagement with the legal process was minimal and ultimately ceased, leading to a judgment in its absence.

• Initial Response: The HOA’s then-president, Randy Hawk, initially responded to the petition by agreeing to hold a meeting.

• First Meeting Attempt: A meeting was scheduled for July 18, 2017. However, only about ten people attended, prompting Hawk to reschedule for December 28, 2017. A letter was sent to all members notifying them of the new date and the intent to hold an election for a new president and vice president.

• Death of Representative: The petitioner subsequently informed the Tribunal that Randy Hawk had passed away, leaving the HOA without a clear representative for the legal matter.

• Failure to Appoint New Representative: On August 16, 2017, the Tribunal issued an order, mailed to the respondent’s address of record, requesting that the HOA name a new representative. The HOA failed to do so.

• Failure to Appear: The respondent did not appear for the scheduled hearing on September 5, 2017, nor did it request to appear telephonically. After a 20-minute grace period, the ALJ proceeded with the hearing in the respondent’s absence.

Legal Framework and Conclusions of Law

The ALJ’s decision was based on a clear statutory requirement and the uncontested evidence presented by the petitioner. The burden of proof was on the petitioner, with the standard of proof being a preponderance of the evidence.

• Statutory Violation: The central finding was that the respondent violated A.R.S. § 33-1804(B). The pertinent text of the statute states:

• Key Conclusion: The ALJ determined that “The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting of Respondent for several years prior to the filing of the petition.”

• Recommended Action: Based on this conclusion, the ALJ stated that the respondent “should hold an annual meeting in accordance with the planned community statutes.”

Final Order and Penalties

The ALJ’s decision was formally adopted by the Commissioner of the Department of Real Estate, making it a binding Final Order. The order mandated several actions by the respondent.

IT IS ORDERED that:

1. The petitioner’s petition is granted.

2. The respondent must hold a meeting in accordance with planned community statutes as scheduled on December 28, 2017.

3. Pursuant to A.R.S. § 32-2199.02(A), the respondent shall pay the petitioner the filing fee required by section 32-2199.01.

4. The respondent shall pay to the planned community hearing office fund a civil penalty of $250.00 for the violation.

This Final Order was declared a final administrative action, effective immediately upon service on September 13, 2017. The parties were notified of their right to apply for a rehearing within thirty days or to appeal the decision by filing a complaint for judicial review.


Jerry Wheeler vs. Beaver Dam Estates Homeowners Association

Posted on by

Case Summary

Case ID 18F-H1717036-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-09-06
Administrative Law Judge Suzanne Marwil
Outcome full
Filing Fees Refunded $500.00
Civil Penalties $250.00

Parties & Counsel

Petitioner Jerry Wheeler Counsel —
Respondent Beaver Dam Estates Homeowners Association Counsel —

Alleged Violations

A.R.S. § 33-1804(B)

Outcome Summary

The Petitioner's petition was granted. The Administrative Law Judge found that the Respondent HOA violated A.R.S. § 33-1804(B) by failing to hold the required annual meeting for several years. The Respondent was ordered to hold a meeting, refund the filing fee to the Petitioner, and pay a $250.00 civil penalty.

Key Issues & Findings

Failure to hold required annual meeting

Petitioner, a homeowner, alleged the HOA had not held an annual meeting since April 1, 2014, violating A.R.S. § 33-1804(B). The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting for several years.

Orders: Petitioner's petition was granted. Respondent was ordered to hold a meeting in accordance with the planned community statutes as currently scheduled on December 28, 2017. Respondent was ordered to pay the filing fee to the Petitioner pursuant to A.R.S. § 32-2199.02(A), and pay a $250.00 civil penalty to the planned community hearing office fund.

Filing fee: $500.00, Fee refunded: Yes, Civil penalty: $250.00

Disposition: petitioner_win

Cited:

  • A.R.S. § 33-1804(B)
  • A.R.S. § 32-2199.02(A)
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.05

Analytics Highlights

Topics: HOA annual meeting violation, statutory requirement, default judgment
Additional Citations:

  • A.R.S. § 33-1804
  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.R.S. § 32-2199.05
  • A.A.C. R2-19-119(B)
  • A.A.C. R2-19-119(A)

Audio Overview

Decision Documents

18F-H1717036-REL Decision – 586602.pdf

Uploaded 2025-10-08T06:58:28 (65.3 KB)

18F-H1717036-REL Decision – 588549.pdf

Uploaded 2025-10-08T06:58:28 (592.6 KB)





Briefing Doc – 18F-H1717036-REL


Administrative Hearing Briefing: Wheeler v. Beaver Dam Estates Homeowners Association

Executive Summary

This briefing document synthesizes the findings and orders from the case of Jerry Wheeler versus the Beaver Dam Estates Homeowners Association (HOA). The central issue was the HOA’s failure to conduct annual meetings as legally required by Arizona state law. The petitioner, Jerry Wheeler, provided uncontested evidence that the HOA had not held a meeting for several years, specifically since his tenure began on April 1, 2014.

The case was complicated by the death of the HOA’s president prior to the hearing and the association’s subsequent failure to appoint a new representative or appear at the proceedings. The Administrative Law Judge (ALJ) conducted the hearing in the respondent’s absence and ruled decisively in favor of the petitioner.

The final judgment, adopted by the Arizona Department of Real Estate, found the Beaver Dam Estates HOA in violation of A.R.S. § 33-1804(B). The HOA was ordered to hold a meeting on a specified date, reimburse the petitioner’s filing fee, and pay a civil penalty of $250.00 for the violation.

Case Overview

The matter was initiated by a petition filed with the Arizona Department of Real Estate and was subsequently referred to the Office of Administrative Hearings for a formal hearing and decision.

Case Detail

Information

Petitioner

Jerry Wheeler

Respondent

Beaver Dam Estates Homeowners Association

Case Number (OAH)

18F-H1717036-REL

Case Number (Dept. of Real Estate)

HO 17-17/036

Petition Filed

June 8, 2017

Hearing Date

September 5, 2017

ALJ Decision Date

September 6, 2017

Final Order Date

September 13, 2017

Presiding Judge

Suzanne Marwil, Administrative Law Judge (ALJ)

Adopting Authority

Judy Lowe, Commissioner, Arizona Department of Real Estate

Petitioner’s Allegations and Evidence

The petitioner’s case was built on the central allegation that the Beaver Dam Estates HOA had failed to comply with its statutory duty to hold annual meetings.

• Core Allegation: The HOA was in violation of Arizona Revised Statutes (A.R.S.) § 33-1804(B), which mandates that a members’ association meeting “shall be held at least once each year.”

• Petitioner Testimony: Jerry Wheeler testified that since moving into the community on April 1, 2014, the HOA had not held a single meeting. He also testified regarding his numerous efforts to compel the HOA president, Randy Hawk, to convene a meeting for the purpose of reviewing the association’s financial statements with homeowners.

• Supporting Evidence: The petitioner submitted numerous written statements from other homeowners within the Beaver Dam Estates community. These statements corroborated his testimony, confirming that no HOA meeting had been held for several years. This evidence was referred to as “Exhibit B” in the proceedings.

Respondent’s Actions and Procedural Failures

The respondent’s engagement with the legal process was minimal and ultimately ceased, leading to a judgment in its absence.

• Initial Response: The HOA’s then-president, Randy Hawk, initially responded to the petition by agreeing to hold a meeting.

• First Meeting Attempt: A meeting was scheduled for July 18, 2017. However, only about ten people attended, prompting Hawk to reschedule for December 28, 2017. A letter was sent to all members notifying them of the new date and the intent to hold an election for a new president and vice president.

• Death of Representative: The petitioner subsequently informed the Tribunal that Randy Hawk had passed away, leaving the HOA without a clear representative for the legal matter.

• Failure to Appoint New Representative: On August 16, 2017, the Tribunal issued an order, mailed to the respondent’s address of record, requesting that the HOA name a new representative. The HOA failed to do so.

• Failure to Appear: The respondent did not appear for the scheduled hearing on September 5, 2017, nor did it request to appear telephonically. After a 20-minute grace period, the ALJ proceeded with the hearing in the respondent’s absence.

Legal Framework and Conclusions of Law

The ALJ’s decision was based on a clear statutory requirement and the uncontested evidence presented by the petitioner. The burden of proof was on the petitioner, with the standard of proof being a preponderance of the evidence.

• Statutory Violation: The central finding was that the respondent violated A.R.S. § 33-1804(B). The pertinent text of the statute states:

• Key Conclusion: The ALJ determined that “The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting of Respondent for several years prior to the filing of the petition.”

• Recommended Action: Based on this conclusion, the ALJ stated that the respondent “should hold an annual meeting in accordance with the planned community statutes.”

Final Order and Penalties

The ALJ’s decision was formally adopted by the Commissioner of the Department of Real Estate, making it a binding Final Order. The order mandated several actions by the respondent.

IT IS ORDERED that:

1. The petitioner’s petition is granted.

2. The respondent must hold a meeting in accordance with planned community statutes as scheduled on December 28, 2017.

3. Pursuant to A.R.S. § 32-2199.02(A), the respondent shall pay the petitioner the filing fee required by section 32-2199.01.

4. The respondent shall pay to the planned community hearing office fund a civil penalty of $250.00 for the violation.

This Final Order was declared a final administrative action, effective immediately upon service on September 13, 2017. The parties were notified of their right to apply for a rehearing within thirty days or to appeal the decision by filing a complaint for judicial review.


Jerry Wheeler vs. Beaver Dam Estates Homeowners Association

Posted on by

Case Summary

Case ID 18F-H1717036-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-09-06
Administrative Law Judge Suzanne Marwil
Outcome full
Filing Fees Refunded $500.00
Civil Penalties $250.00

Parties & Counsel

Petitioner Jerry Wheeler Counsel —
Respondent Beaver Dam Estates Homeowners Association Counsel —

Alleged Violations

A.R.S. § 33-1804(B)

Outcome Summary

The Petitioner's petition was granted. The Administrative Law Judge found that the Respondent HOA violated A.R.S. § 33-1804(B) by failing to hold the required annual meeting for several years. The Respondent was ordered to hold a meeting, refund the filing fee to the Petitioner, and pay a $250.00 civil penalty.

Key Issues & Findings

Failure to hold required annual meeting

Petitioner, a homeowner, alleged the HOA had not held an annual meeting since April 1, 2014, violating A.R.S. § 33-1804(B). The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting for several years.

Orders: Petitioner's petition was granted. Respondent was ordered to hold a meeting in accordance with the planned community statutes as currently scheduled on December 28, 2017. Respondent was ordered to pay the filing fee to the Petitioner pursuant to A.R.S. § 32-2199.02(A), and pay a $250.00 civil penalty to the planned community hearing office fund.

Filing fee: $500.00, Fee refunded: Yes, Civil penalty: $250.00

Disposition: petitioner_win

Cited:

  • A.R.S. § 33-1804(B)
  • A.R.S. § 32-2199.02(A)
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.05

Analytics Highlights

Topics: HOA annual meeting violation, statutory requirement, default judgment
Additional Citations:

  • A.R.S. § 33-1804
  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.R.S. § 32-2199.05
  • A.A.C. R2-19-119(B)
  • A.A.C. R2-19-119(A)

Audio Overview

Decision Documents

18F-H1717036-REL Decision – 586602.pdf

Uploaded 2025-10-08T07:02:44 (65.3 KB)

18F-H1717036-REL Decision – 588549.pdf

Uploaded 2025-10-08T07:02:44 (592.6 KB)





Briefing Doc – 18F-H1717036-REL


Administrative Hearing Briefing: Wheeler v. Beaver Dam Estates Homeowners Association

Executive Summary

This briefing document synthesizes the findings and orders from the case of Jerry Wheeler versus the Beaver Dam Estates Homeowners Association (HOA). The central issue was the HOA’s failure to conduct annual meetings as legally required by Arizona state law. The petitioner, Jerry Wheeler, provided uncontested evidence that the HOA had not held a meeting for several years, specifically since his tenure began on April 1, 2014.

The case was complicated by the death of the HOA’s president prior to the hearing and the association’s subsequent failure to appoint a new representative or appear at the proceedings. The Administrative Law Judge (ALJ) conducted the hearing in the respondent’s absence and ruled decisively in favor of the petitioner.

The final judgment, adopted by the Arizona Department of Real Estate, found the Beaver Dam Estates HOA in violation of A.R.S. § 33-1804(B). The HOA was ordered to hold a meeting on a specified date, reimburse the petitioner’s filing fee, and pay a civil penalty of $250.00 for the violation.

Case Overview

The matter was initiated by a petition filed with the Arizona Department of Real Estate and was subsequently referred to the Office of Administrative Hearings for a formal hearing and decision.

Case Detail

Information

Petitioner

Jerry Wheeler

Respondent

Beaver Dam Estates Homeowners Association

Case Number (OAH)

18F-H1717036-REL

Case Number (Dept. of Real Estate)

HO 17-17/036

Petition Filed

June 8, 2017

Hearing Date

September 5, 2017

ALJ Decision Date

September 6, 2017

Final Order Date

September 13, 2017

Presiding Judge

Suzanne Marwil, Administrative Law Judge (ALJ)

Adopting Authority

Judy Lowe, Commissioner, Arizona Department of Real Estate

Petitioner’s Allegations and Evidence

The petitioner’s case was built on the central allegation that the Beaver Dam Estates HOA had failed to comply with its statutory duty to hold annual meetings.

• Core Allegation: The HOA was in violation of Arizona Revised Statutes (A.R.S.) § 33-1804(B), which mandates that a members’ association meeting “shall be held at least once each year.”

• Petitioner Testimony: Jerry Wheeler testified that since moving into the community on April 1, 2014, the HOA had not held a single meeting. He also testified regarding his numerous efforts to compel the HOA president, Randy Hawk, to convene a meeting for the purpose of reviewing the association’s financial statements with homeowners.

• Supporting Evidence: The petitioner submitted numerous written statements from other homeowners within the Beaver Dam Estates community. These statements corroborated his testimony, confirming that no HOA meeting had been held for several years. This evidence was referred to as “Exhibit B” in the proceedings.

Respondent’s Actions and Procedural Failures

The respondent’s engagement with the legal process was minimal and ultimately ceased, leading to a judgment in its absence.

• Initial Response: The HOA’s then-president, Randy Hawk, initially responded to the petition by agreeing to hold a meeting.

• First Meeting Attempt: A meeting was scheduled for July 18, 2017. However, only about ten people attended, prompting Hawk to reschedule for December 28, 2017. A letter was sent to all members notifying them of the new date and the intent to hold an election for a new president and vice president.

• Death of Representative: The petitioner subsequently informed the Tribunal that Randy Hawk had passed away, leaving the HOA without a clear representative for the legal matter.

• Failure to Appoint New Representative: On August 16, 2017, the Tribunal issued an order, mailed to the respondent’s address of record, requesting that the HOA name a new representative. The HOA failed to do so.

• Failure to Appear: The respondent did not appear for the scheduled hearing on September 5, 2017, nor did it request to appear telephonically. After a 20-minute grace period, the ALJ proceeded with the hearing in the respondent’s absence.

Legal Framework and Conclusions of Law

The ALJ’s decision was based on a clear statutory requirement and the uncontested evidence presented by the petitioner. The burden of proof was on the petitioner, with the standard of proof being a preponderance of the evidence.

• Statutory Violation: The central finding was that the respondent violated A.R.S. § 33-1804(B). The pertinent text of the statute states:

• Key Conclusion: The ALJ determined that “The unconverted evidence established that Respondent violated A.R.S. § 33-1804(B) by failing to hold the statutorily required annual meeting of Respondent for several years prior to the filing of the petition.”

• Recommended Action: Based on this conclusion, the ALJ stated that the respondent “should hold an annual meeting in accordance with the planned community statutes.”

Final Order and Penalties

The ALJ’s decision was formally adopted by the Commissioner of the Department of Real Estate, making it a binding Final Order. The order mandated several actions by the respondent.

IT IS ORDERED that:

1. The petitioner’s petition is granted.

2. The respondent must hold a meeting in accordance with planned community statutes as scheduled on December 28, 2017.

3. Pursuant to A.R.S. § 32-2199.02(A), the respondent shall pay the petitioner the filing fee required by section 32-2199.01.

4. The respondent shall pay to the planned community hearing office fund a civil penalty of $250.00 for the violation.

This Final Order was declared a final administrative action, effective immediately upon service on September 13, 2017. The parties were notified of their right to apply for a rehearing within thirty days or to appeal the decision by filing a complaint for judicial review.


Jay Janicek vs. Sycamore Vista No. 8 HOA

Posted on by

Case Summary

Case ID 17F-H1717033-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-08-14
Administrative Law Judge Dorinda M. Lang
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Jay Janicek Counsel —
Respondent Sycamore Vista No. 8 HOA Counsel Evan Thompson

Alleged Violations

Article 11. Section 11.5 of the CC&Rs

Outcome Summary

The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.

Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.

Key Issues & Findings

Alleged violation of CC&Rs regarding disproportionate assessment fees

Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.

Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01(D)
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119(B)

Analytics Highlights

Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:

  • A.R.S. § 32-2199
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119

Video Overview

Audio Overview

Decision Documents

17F-H1717033-REL Decision – 575166.pdf

Uploaded 2025-10-09T03:31:37 (39.1 KB)

17F-H1717033-REL Decision – 582189.pdf

Uploaded 2025-10-09T03:31:37 (69.4 KB)

17F-H1717033-REL Decision – 584918.pdf

Uploaded 2025-10-09T03:31:37 (674.1 KB)





Briefing Doc – 17F-H1717033-REL


Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA

Executive Summary

This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.

The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.

The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.

Case Overview

The following table outlines the principal parties and details of the administrative hearing.

Case Detail

Information

Petitioner

Jay Janicek

Respondent

Sycamore Vista No. 8 HOA

Respondent’s Counsel

Evan Thompson, Thompson Krone PLC

Respondent’s Representative

Steve Russo

Case Number

17F-H1717033-REL

Docket Number

17F-H1717033-REL

Hearing Date

July 12, 2017

Presiding Judge

Dorinda M. Lang, Administrative Law Judge

Hearing Observers

John Shields, Margery and Mathew Janicek

Petitioner’s Allegations

The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:

• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.

• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:

• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.

• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.

Adjudication and Findings of Fact

The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.

Evidentiary Failure

The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.

• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”

• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”

• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.

Lack of Legal Authority

The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.

• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”

• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.

Post-Hearing Submissions

The record was held open until August 1, 2017, allowing for additional documentation from both parties.

• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.

• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”

Conclusions of Law and Final Decision

Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.

Denial of Petition

• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”

• The payment for Common Areas was found to be in comportment with the CC&Rs.

Rejection of Key Arguments

• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”

• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”

Timeline of Orders

1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.

2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.

3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.

Post-Decision Procedures

The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.

• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.

• A rehearing may be granted for the following causes:

1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.

2. Misconduct by the Department, ALJ, or the prevailing party.

3. Accident or surprise that could not have been prevented by ordinary prudence.

4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.

5. Excessive or insufficient penalties.

6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.

7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.

8. The findings of fact or decision is not supported by the evidence or is contrary to law.

• Parties may appeal the final administrative action by filing a complaint for judicial review.


Jay Janicek vs. Sycamore Vista No. 8 HOA

Posted on by

Case Summary

Case ID 17F-H1717033-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-08-14
Administrative Law Judge Dorinda M. Lang
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Jay Janicek Counsel —
Respondent Sycamore Vista No. 8 HOA Counsel Evan Thompson

Alleged Violations

Article 11. Section 11.5 of the CC&Rs

Outcome Summary

The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.

Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.

Key Issues & Findings

Alleged violation of CC&Rs regarding disproportionate assessment fees

Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.

Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01(D)
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119(B)

Analytics Highlights

Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:

  • A.R.S. § 32-2199
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119

Audio Overview

Decision Documents

17F-H1717033-REL Decision – 575166.pdf

Uploaded 2025-10-08T06:57:56 (39.1 KB)

17F-H1717033-REL Decision – 582189.pdf

Uploaded 2025-10-08T06:57:57 (69.4 KB)

17F-H1717033-REL Decision – 584918.pdf

Uploaded 2025-10-08T06:57:58 (674.1 KB)





Briefing Doc – 17F-H1717033-REL


Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA

Executive Summary

This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.

The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.

The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.

Case Overview

The following table outlines the principal parties and details of the administrative hearing.

Case Detail

Information

Petitioner

Jay Janicek

Respondent

Sycamore Vista No. 8 HOA

Respondent’s Counsel

Evan Thompson, Thompson Krone PLC

Respondent’s Representative

Steve Russo

Case Number

17F-H1717033-REL

Docket Number

17F-H1717033-REL

Hearing Date

July 12, 2017

Presiding Judge

Dorinda M. Lang, Administrative Law Judge

Hearing Observers

John Shields, Margery and Mathew Janicek

Petitioner’s Allegations

The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:

• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.

• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:

• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.

• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.

Adjudication and Findings of Fact

The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.

Evidentiary Failure

The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.

• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”

• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”

• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.

Lack of Legal Authority

The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.

• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”

• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.

Post-Hearing Submissions

The record was held open until August 1, 2017, allowing for additional documentation from both parties.

• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.

• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”

Conclusions of Law and Final Decision

Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.

Denial of Petition

• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”

• The payment for Common Areas was found to be in comportment with the CC&Rs.

Rejection of Key Arguments

• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”

• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”

Timeline of Orders

1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.

2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.

3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.

Post-Decision Procedures

The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.

• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.

• A rehearing may be granted for the following causes:

1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.

2. Misconduct by the Department, ALJ, or the prevailing party.

3. Accident or surprise that could not have been prevented by ordinary prudence.

4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.

5. Excessive or insufficient penalties.

6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.

7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.

8. The findings of fact or decision is not supported by the evidence or is contrary to law.

• Parties may appeal the final administrative action by filing a complaint for judicial review.


Jay Janicek vs. Sycamore Vista No. 8 HOA

Posted on by

Case Summary

Case ID 17F-H1717033-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-08-14
Administrative Law Judge Dorinda M. Lang
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Jay Janicek Counsel —
Respondent Sycamore Vista No. 8 HOA Counsel Evan Thompson

Alleged Violations

Article 11. Section 11.5 of the CC&Rs

Outcome Summary

The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.

Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.

Key Issues & Findings

Alleged violation of CC&Rs regarding disproportionate assessment fees

Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.

Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01(D)
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119(B)

Analytics Highlights

Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:

  • A.R.S. § 32-2199
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119

Audio Overview

Decision Documents

17F-H1717033-REL Decision – 575166.pdf

Uploaded 2025-10-08T07:02:10 (39.1 KB)

17F-H1717033-REL Decision – 582189.pdf

Uploaded 2025-10-08T07:02:11 (69.4 KB)

17F-H1717033-REL Decision – 584918.pdf

Uploaded 2025-10-08T07:02:11 (674.1 KB)





Briefing Doc – 17F-H1717033-REL


Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA

Executive Summary

This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.

The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.

The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.

Case Overview

The following table outlines the principal parties and details of the administrative hearing.

Case Detail

Information

Petitioner

Jay Janicek

Respondent

Sycamore Vista No. 8 HOA

Respondent’s Counsel

Evan Thompson, Thompson Krone PLC

Respondent’s Representative

Steve Russo

Case Number

17F-H1717033-REL

Docket Number

17F-H1717033-REL

Hearing Date

July 12, 2017

Presiding Judge

Dorinda M. Lang, Administrative Law Judge

Hearing Observers

John Shields, Margery and Mathew Janicek

Petitioner’s Allegations

The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:

• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.

• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:

• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.

• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.

Adjudication and Findings of Fact

The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.

Evidentiary Failure

The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.

• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”

• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”

• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.

Lack of Legal Authority

The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.

• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”

• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.

Post-Hearing Submissions

The record was held open until August 1, 2017, allowing for additional documentation from both parties.

• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.

• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”

Conclusions of Law and Final Decision

Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.

Denial of Petition

• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”

• The payment for Common Areas was found to be in comportment with the CC&Rs.

Rejection of Key Arguments

• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”

• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”

Timeline of Orders

1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.

2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.

3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.

Post-Decision Procedures

The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.

• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.

• A rehearing may be granted for the following causes:

1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.

2. Misconduct by the Department, ALJ, or the prevailing party.

3. Accident or surprise that could not have been prevented by ordinary prudence.

4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.

5. Excessive or insufficient penalties.

6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.

7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.

8. The findings of fact or decision is not supported by the evidence or is contrary to law.

• Parties may appeal the final administrative action by filing a complaint for judicial review.


Jay Janicek vs. Sycamore Vista No. 8 HOA

Posted on by

Case Summary

Case ID 17F-H1717033-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-08-14
Administrative Law Judge Dorinda M. Lang
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Jay Janicek Counsel —
Respondent Sycamore Vista No. 8 HOA Counsel Evan Thompson

Alleged Violations

Article 11. Section 11.5 of the CC&Rs

Outcome Summary

The ALJ found that the Petitioner did not establish a violation of the Respondent's CC&Rs and recommended the petition be denied. The ALJ specifically noted the lack of proof that fees were inappropriate and that Petitioner failed to provide legal authority requiring equal benefit. The petition was denied, and the Respondent was not ordered to pay the Petitioner's filing fee.

Why this result: The Petitioner failed to meet the burden of proof required to establish a violation of the CC&Rs.

Key Issues & Findings

Alleged violation of CC&Rs regarding disproportionate assessment fees

Petitioner alleged Respondent was in violation of its CC&Rs because Master HOA fees were disproportionately borne by existing homeowners and did not benefit the whole development equally. Petitioner failed to establish a violation because required evidentiary documents (plat attached as 'Exhibit B') were missing, and Petitioner offered no legal authority requiring fees to be equally beneficial or even-handed.

Orders: Petitioner's petition is denied. Respondent shall not pay the filing fee required by section 32-2199.01 to the Petitioner.

Filing fee: $0.00, Fee refunded: No

Disposition: respondent_win

Cited:

  • A.R.S. § 32-2199 et seq.
  • A.R.S. § 32-2199.01(D)
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119(B)

Analytics Highlights

Topics: CC&Rs, Master HOA, Assessment Fees, Common Areas, Burden of Proof, Rule Against Perpetuities
Additional Citations:

  • A.R.S. § 32-2199
  • A.R.S. § 32-2199.01
  • A.R.S. § 32-2199.02
  • A.A.C. R2-19-119

Audio Overview

Decision Documents

17F-H1717033-REL Decision – 575166.pdf

Uploaded 2025-10-08T06:51:11 (39.1 KB)

17F-H1717033-REL Decision – 582189.pdf

Uploaded 2025-10-08T06:51:11 (69.4 KB)

17F-H1717033-REL Decision – 584918.pdf

Uploaded 2025-10-08T06:51:12 (674.1 KB)





Briefing Doc – 17F-H1717033-REL


Administrative Hearing Briefing: Janicek v. Sycamore Vista No. 8 HOA

Executive Summary

This briefing document synthesizes the key findings and legal proceedings in case number 17F-H1717033-REL, wherein Petitioner Jay Janicek filed a complaint against Respondent Sycamore Vista No. 8 HOA. The petition was ultimately denied by an Administrative Law Judge (ALJ), a decision formally adopted and finalized by the Commissioner of the Arizona Department of Real Estate.

The core of the dispute centered on the Petitioner’s allegation that the HOA’s fee structure violated its Covenants, Conditions, and Restrictions (CC&Rs). Specifically, Janicek argued that payments made by his first-level association to a master association for common area expenses—most egregiously for a roadway loan—were improper because the benefits were not distributed equally among all homeowners.

The denial of the petition hinged on a critical failure of proof by the Petitioner. The CC&Rs define “Common Areas” by referencing a plat map (“Exhibit B”) that was not submitted into evidence by the Petitioner. Without this crucial document, it was impossible to prove that the fees collected by the HOA were for purposes outside the scope of the CC&Rs. Furthermore, the Petitioner failed to provide any legal authority or provision within the governing documents requiring that association fees be “even-handed or equally beneficial to all homeowners.” A secondary argument regarding the “rule against perpetuities,” introduced post-hearing, was also addressed and dismissed by the ALJ as legally inapplicable to the matter.

Case Overview

The following table outlines the principal parties and details of the administrative hearing.

Case Detail

Information

Petitioner

Jay Janicek

Respondent

Sycamore Vista No. 8 HOA

Respondent’s Counsel

Evan Thompson, Thompson Krone PLC

Respondent’s Representative

Steve Russo

Case Number

17F-H1717033-REL

Docket Number

17F-H1717033-REL

Hearing Date

July 12, 2017

Presiding Judge

Dorinda M. Lang, Administrative Law Judge

Hearing Observers

John Shields, Margery and Mathew Janicek

Petitioner’s Allegations

The petition filed by Jay Janicek alleged that Sycamore Vista No. 8 HOA was in violation of its governing CC&Rs. The central arguments presented were:

• Unequal Distribution of Costs and Benefits: The Petitioner contended that expenses paid by the Respondent association to the Sycamore Vista Master Home Owner’s Association (“Master HOA”) did not benefit all homeowners equally. The most “egregious” example cited was the payment toward a loan for a roadway within the master development.

• Violation of CC&Rs: The Petitioner argued that this unequal cost burden was a direct violation of Article 11, Section 11.5 of the Respondent’s CC&Rs. This section stipulates:

• Discrepancy Among Associations: The Petitioner asserted that another first-level association within the master development receives more benefit from the common areas but does not pay into the Master HOA.

• Rule Against Perpetuities: In a post-hearing submission, the Petitioner introduced a new argument that a “rule against perpetuities” was at stake in the matter.

Adjudication and Findings of Fact

The Administrative Law Judge’s decision was based on the Petitioner’s failure to meet the required burden of proof through a preponderance of the evidence.

Evidentiary Failure

The Petitioner’s case failed primarily due to a lack of sufficient evidence to prove a violation of the CC&Rs.

• Missing ‘Exhibit B’: The definition of “Common Areas” was essential to the case. According to Article 1, Section 1.6 of the CC&Rs, these areas are delineated on a plat that was supposed to be attached as “Exhibit B.”

• Critical Finding: The ALJ noted, “Unfortunately, there was no plat attached to the document that was offered into evidence and it was not to be found among the other exhibits. Therefore, Petitioner was unable to establish that Respondent’s fees pay for anything that is not provided for in the CC&Rs.”

• Petitioner’s Concession: The Petitioner did not dispute the Respondent’s argument that the Master HOA fees, including those for roads, were for Common Areas.

Lack of Legal Authority

The Petitioner’s core premise—that fees must be proportional to benefits received—was not substantiated by legal or documentary support.

• The ALJ found that the “Petitioner offered no legal authority that requires that all first level associations must pay the same into a master association or that all homeowners must receive the same benefit from or contribute the same amount (or even a proportionate share) to the common areas.”

• The argument that association fees were “disproportionately heavy” was not established to be a violation of any provision in the CC&Rs.

Post-Hearing Submissions

The record was held open until August 1, 2017, allowing for additional documentation from both parties.

• Petitioner (Exhibit 6): Submitted financial documentation, emails, and the argument concerning the rule against perpetuities.

• Respondent (Exhibit H): Submitted a Notice of Lien and attachments. This exhibit demonstrated that, regarding a lien for water services on properties not part of the Respondent HOA, the “Respondent’s homeowners are not responsible for it.”

Conclusions of Law and Final Decision

Based on the evidence and arguments presented, the ALJ denied the petition, a decision later finalized by the Arizona Department of Real Estate.

Denial of Petition

• The primary conclusion of law was that the “Petitioner has not established that Respondent is in violation of its CC&Rs.”

• The payment for Common Areas was found to be in comportment with the CC&Rs.

Rejection of Key Arguments

• Equal Benefit: The ALJ explicitly concluded: “Petitioner has offered no legal authority or provision of the CC&Rs that requires the association fees to be even-handed or equally beneficial to all homeowners.”

• Rule Against Perpetuities: While this argument was not part of the original petition, the ALJ addressed it to “lay a concern to rest.” The judge explained that the rule, which states that property ownership must vest within a lifetime plus 21 years, evolved from estate law and does not apply to HOA property sales where ownership vests immediately in the developer or a new owner. The judge concluded, “the rule against perpetuities does not apply to a homeowner’s association and it clearly does not apply in this matter.”

Timeline of Orders

1. July 12, 2017: An “Order Holding Record Open” was issued by ALJ Dorinda M. Lang.

2. August 14, 2017: The “Administrative Law Judge Decision” was issued, ordering that the Petitioner’s petition be denied.

3. August 21, 2017: A “Final Order” was issued by Judy Lowe, Commissioner of the Department of Real Estate, adopting the ALJ’s decision and officially denying the petition.

Post-Decision Procedures

The Final Order, effective August 21, 2017, concluded the administrative action and outlined the subsequent options available to the parties.

• The order is binding unless a rehearing is granted. A request for rehearing must be filed within 30 days of the service of the final order.

• A rehearing may be granted for the following causes:

1. Irregularity in the proceedings or any order or abuse of discretion that deprived a party of a fair hearing.

2. Misconduct by the Department, ALJ, or the prevailing party.

3. Accident or surprise that could not have been prevented by ordinary prudence.

4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.

5. Excessive or insufficient penalties.

6. Error in the admission or rejection of evidence or other errors of law occurring during the proceeding.

7. The findings of fact or decision is arbitrary, capricious, or an abuse of discretion.

8. The findings of fact or decision is not supported by the evidence or is contrary to law.

• Parties may appeal the final administrative action by filing a complaint for judicial review.


Jerry and Patricia Gravelle vs. Village Parc Homeowners Assoc. of

Posted on by

Case Summary

Case ID 17F-H1716008-REL
Agency ADRE
Tribunal OAH
Decision Date 2017-01-03
Administrative Law Judge Diane Mihalsky
Outcome loss
Filing Fees Refunded $0.00
Civil Penalties $0.00

Parties & Counsel

Petitioner Jerry and Patricia Gravelle Counsel —
Respondent Village Parc Homeowners Assoc. of Havasu Counsel Kenneth E. Moyer, Esq.

Alleged Violations

CC&Rs Article 11, Section 11.7.3; CC&Rs Article 11, Section 11.7.6

Outcome Summary

The Commissioner adopted the ALJ's recommendation to dismiss the petition, finding that the HOA was not required by the governing documents (CC&Rs) or state law (Arizona Condominium Act) to insure against damages to the interior finished surfaces of the petitioners' individual condominium unit.

Why this result: The CC&Rs put Petitioners on notice that Respondent was not required to provide insurance coverage for damages to their individual unit, and Petitioners did not establish that Respondent was responsible for the damages.

Key Issues & Findings

HOA responsibility to insure unit interior damages caused by sewer backup

Petitioners claimed Respondent HOA violated CC&Rs (specifically Sections 11.7.3 and 11.7.6) by not providing insurance coverage for $6,697.70 in damages to the interior of their individual unit caused by a sewer backup. The HOA contended the CC&Rs and Arizona Condominium Act place this responsibility on the unit owner.

Orders: The petition was dismissed, and no action was required of the Respondent.

Filing fee: $0.00, Fee refunded: No

Disposition: petitioner_loss

Cited:

  • A.R.S. § 33-1212(1)
  • A.R.S. § 33-1247(A)
  • A.R.S. § 32-2199.01

Analytics Highlights

Topics: Condominiums, Insurance Coverage, CC&Rs Interpretation, Unit Boundaries, Maintenance Responsibility
Additional Citations:

  • A.R.S. § 33-1212(1)
  • A.R.S. § 33-1247(A)
  • A.R.S. § 32-2199.01
  • CC&Rs Article 11, Section 11.7.3
  • CC&Rs Article 11, Section 11.7.6

Video Overview

Audio Overview

Decision Documents

17F-H1716008-REL Decision – 528194.pdf

Uploaded 2025-10-09T03:31:06 (58.8 KB)

17F-H1716008-REL Decision – 528432.pdf

Uploaded 2025-10-09T03:31:06 (63.1 KB)

17F-H1716008-REL Decision – 535933.pdf

Uploaded 2025-10-09T03:31:06 (131.6 KB)

17F-H1716008-REL Decision – 539997.pdf

Uploaded 2025-10-09T03:31:06 (1010.1 KB)





Briefing Doc – 17F-H1716008-REL


Briefing: Gravelle v. Village Parc Homeowners Association

Executive Summary

This briefing synthesizes the key findings and legal determinations from an administrative case between homeowners Jerry and Patricia Gravelle and the Village Parc Homeowners Association of Havasu (HOA). The dispute centered on liability for damages within the Gravelles’ condominium unit caused by a sewer backup.

The petition, filed with the Arizona Department of Real Estate, was ultimately dismissed. The Administrative Law Judge (ALJ) concluded, and the Department Commissioner affirmed, that the HOA’s governing documents—the Covenants, Conditions, and Restrictions (CC&Rs)—unambiguously place the responsibility for insuring the interior of an individual unit on the unit owner, not the HOA.

The ruling established that the HOA’s master insurance policy, provided by Travelers, was only obligated to cover what the CC&Rs required. Arguments based on the HOA’s past payments for minor damages in other units, an erroneous initial statement by an insurance adjuster on a prior claim, and the HOA Board’s own mistaken interpretation of its duties were all found to be insufficient to override the plain written language of the governing documents. The final decision reinforces the principle that unit owners are responsible for understanding their CC&Rs and securing adequate personal insurance for their property.

I. Case Overview and Final Disposition

• Case Identification: No. 17F-H1716008-REL

• Parties:

◦ Petitioners: Jerry and Patricia Gravelle, owners of Unit 14 in the Village Parc development.

◦ Respondent: Village Parc Homeowners Assoc. of Havasu (“the Association”).

• Adjudicating Body: The case was heard in the Arizona Office of Administrative Hearings before Administrative Law Judge (ALJ) Diane Mihalsky. The final order was issued by the Commissioner of the Arizona Department of Real Estate.

• Key Dates:

◦ Hearing Date: November 10, 2016

◦ ALJ Decision: December 22, 2016

◦ Final Order: January 3, 2017

• Final Disposition: The Commissioner of the Department of Real Estate, Judy Lowe, accepted the ALJ’s recommendation and ordered that the petition be dismissed. This constituted a final administrative action, effective immediately. Parties were advised of their right to file for rehearing or appeal for judicial review.

II. The Core Dispute: Insurance for Sewer Backup Damage

On or about October 23, 2015, the Petitioners’ condominium (Unit 14), along with two other units, suffered damage from a sewer backup. The central conflict arose from determining which party was financially responsible for the repairs inside the Petitioners’ unit.

• Petitioners’ Claim: The Gravelles filed a petition on August 31, 2016, alleging the Association violated Articles 11.7.3 and 11.7.6 of the CC&Rs by failing to provide insurance coverage for the full extent of the damages. Their personal insurance policy did not cover sewer backups. They requested the Association pay $6,697.70 to reimburse them for the loss that the Association’s insurer, Travelers, declined to cover.

• Insurance Claim Outcome:

◦ The Association submitted a claim for the sewer backup damages to its insurer, Travelers.

◦ Travelers determined that its policy covered damages to the common elements associated with the unit and issued a check to the Petitioners for $338.64.

◦ Travelers concluded there was no coverage under the policy for damage to the interior of the Petitioners’ unit. This denial was based on the CC&Rs, which establish that the unit owner is responsible for the finished surfaces and personal property within their unit.

III. Analysis of Governing Documents and Legal Framework

The ALJ’s decision was grounded in a strict interpretation of the Association’s CC&Rs, its insurance contract, and the Arizona Condominium Act.

Document / Statute

Key Provisions and Implications

Village Parc CC&Rs

Unit Definition (Sec. 2.2.1): A unit is defined as the space “bounded by and contained within the interior finished surfaces of the perimeter walls, floors and ceilings.”

Insurance Responsibility (Sec. 11.7.3): The Association’s master policy is explicitly “not be required to insure the personal property within any individual Unit, which insurance shall be the responsibility and risk of the Unit Owners.”

Liability Limitation (Sec. 11.7.5): The Association is not liable to any owner “if any risk or hazard is not covered by insurance or the amount is inadequate.” It places the burden on each owner to ascertain the Association’s coverage and procure their own additional insurance.

Travelers Insurance Policy

Conditional Coverage Endorsement: The policy covers certain property (fixtures, alterations, appliances) contained within a unit, but only “if your Condominium Association Agreement requires you to insure it.” Since the CC&Rs do not require the Association to insure unit interiors, this coverage was not triggered.

Primary Insurance: The policy states it is “intended to be primary, and not to contribute with such other insurance” a unit-owner may have.

Arizona Condominium Act

Unit Definition (A.R.S. § 33-1212(1)): Reinforces the CC&Rs by defining finished surfaces—”lath, furring, wallboard… tiles, wallpaper, paint, finished flooring”—as part of the unit. All other portions of walls, floors, or ceilings are common elements.

Maintenance Responsibility (A.R.S. § 33-1247(A)): The law specifies that “the association is responsible for maintenance, repair and replacement of the common elements and each unit owner is responsible for maintenance, repair and replacement of the unit.”

IV. Petitioners’ Arguments and the ALJ’s Rejection

The Petitioners presented evidence of past practices by both the Association and Travelers, arguing these created an expectation of coverage. The ALJ systematically rejected these arguments.

• Argument 1: The Association’s Past Payments for Unit Repairs

◦ Petitioners’ Evidence: The Association had authorized payments for repairs inside other units on prior occasions:

▪ June 2011: $153.74, $75.00, and $296.11 for damage to Units 3 and 5 from a broken shower drain.

▪ January 2012: $449.45 to repair kitchen cabinets in Unit 6 damaged by a broken roof vent.

◦ ALJ’s Conclusion: The fact that the Association’s Board made “actual payments of small amounts for damages to individually owned units” does not legally amend the plain language of the CC&Rs. Notably, the Association did not submit these prior incidents to its insurer.

• Argument 2: Travelers’ Prior Actions

◦ Petitioners’ Evidence: In a 2014 claim, a Travelers adjuster initially determined that the policy did provide coverage for damage done to a unit, not just limited common elements.

◦ ALJ’s Conclusion: Travelers later stated the adjuster had erred and confirmed no claim for unit damage was ultimately paid. The ALJ found that the “adjuster’s initial error in the 2014 claim does not estop Travelers from denying the claim for damages to Petitioners’ unit” in 2015.

• Argument 3: The Association Board’s Own Interpretation

◦ Petitioners’ Evidence: At a November 2015 board meeting, where Mr. Gravelle served as secretary/treasurer, the Board itself determined that the CC&Rs did require the Association to provide insurance coverage for all damages to Unit 14.

◦ ALJ’s Conclusion: The Board’s “erroneous opinion” does not have the legal power to amend the CC&Rs or the binding terms of the Travelers insurance policy.

V. Core Legal Principles and Final Decision

The dismissal of the petition was based on several foundational legal principles.

• Primacy of Written Documents: The decision gave superior weight to the “plain language” of the CC&Rs and the insurance contract over inconsistent past practices or mistaken interpretations.

• Burden of Proof: As the filing party, the Petitioners had the burden to prove by a “preponderance of the evidence” that the Association violated the CC&Rs. The ALJ determined they failed to meet this standard.

• Clear Delineation of Responsibility: Both the CC&Rs and Arizona state law create a clear separation of financial and maintenance responsibilities: the Association is responsible for common elements, while individual owners are responsible for their units.

• Presumption of Knowledge: The decision cited the legal principle that “Everyone is presumed to know the law.” The CC&Rs put the Petitioners on constructive notice that they were responsible for insuring their individual unit against risks like a sewer backup. Their failure to procure such coverage was their own responsibility.