Briefing Doc – 19F-H1918009-REL-RHG
Administrative Hearing Brief: Garcia v. Villagio at Tempe Homeowners Association
Executive Summary
This document synthesizes the findings from two administrative law hearings concerning a dispute between homeowner Rogelio A. Garcia (Petitioner) and the Villagio at Tempe Homeowners Association (Respondent). The core of the dispute was Mr. Garcia’s allegation that the HOA violated Arizona Revised Statute (A.R.S.) § 33-1242 in its handling of a violation notice for an improper short-term rental.
The Administrative Law Judge (ALJ) dismissed Mr. Garcia’s petition in both an initial hearing on October 30, 2018, and a subsequent rehearing on February 12, 2019. The rulings consistently found that Mr. Garcia failed to meet his burden of proof.
The central conclusion of the ALJ was that the statutory protections Mr. Garcia claimed he was denied under A.R.S. § 33-1242 are contingent upon the homeowner first taking a specific action: responding to a violation notice in writing via certified mail within 21 calendar days. It was undisputed in both hearings that Mr. Garcia did not take this step. Consequently, the HOA’s statutory obligations to provide the name of the violation’s observer and other specific information were never triggered. Furthermore, because the HOA’s violation notices included instructions for its own internal appeal process, it was not required by statute to inform Mr. Garcia of his option to petition for a separate administrative hearing.
Case Background and Chronology
The case centers on a series of violation notices sent by the Villagio at Tempe Homeowners Association to unit owner Rogelio A. Garcia concerning the use of his property. Mr. Garcia subsequently petitioned the Arizona Department of Real Estate, alleging procedural violations by the HOA.
March 8, 2018
Villagio sends Mr. Garcia a letter alleging his unit is being rented in violation of short-term lease provisions in the CC&Rs.
March 22, 2018
Villagio sends a second notice, indicating a $1,000 fine has been posted to Mr. Garcia’s account for the ongoing violation.
April 5, 2018
Villagio sends a third notice, indicating a $2,000 fine has been posted to his account.
August 17, 2018
Mr. Garcia files a petition with the Arizona Department of Real Estate alleging Villagio violated A.R.S. § 33-1242.
October 30, 2018
The initial evidentiary hearing is held before Administrative Law Judge Velva Moses-Thompson.
November 19, 2018
The ALJ issues a decision dismissing Mr. Garcia’s petition.
January 3, 2019
The Arizona Department of Real Estate issues an order for a rehearing of the matter at Mr. Garcia’s request.
February 12, 2019
A rehearing is held, with testimony from Mr. Garcia and Tom Gordon, Villagio’s Community Manager.
March 4, 2019
The ALJ issues a final decision, again dismissing Mr. Garcia’s petition and affirming Villagio as the prevailing party. The order is made binding on the parties.
Petitioner’s Arguments (Rogelio A. Garcia)
Across both hearings, Mr. Garcia maintained that Villagio violated the procedural requirements of A.R.S. § 33-1242. His specific arguments included:
• Failure to Provide Observer’s Name: Villagio did not provide the first and last name of the person or persons who observed the alleged short-term rental violation.
• Denial of Administrative Hearing Notice: The HOA failed to provide written notice of his option to petition for an administrative hearing with the state real estate department.
• Denial of Response Opportunity: Mr. Garcia contended that Villagio effectively prevented him from responding via certified mail within the 21-day statutory window. He based this claim on two points:
◦ The HOA issued a second notice and a fine only 14 days after the first notice, creating confusion and pressure that precluded a 21-day response.
◦ The notices included the phrase, “Please bring this issue into compliance within 10 days of this notice,” which he interpreted as the operative deadline, superseding the 21-day statutory period.
• In his petition, he stated the violation letter “did not allow for home owner to respond to violation by certified letter within 21 calendar days after the date of the notice.”
Respondent’s Arguments (Villagio at Tempe HOA)
Villagio’s defense, presented by Nathan Tennyson, Esq., centered on a direct interpretation of the statute and Mr. Garcia’s failure to adhere to its requirements.
• Petitioner’s Inaction as the Decisive Factor: Villagio’s primary argument was that Mr. Garcia never took the necessary step to trigger the protections of A.R.S. § 33-1242(C). The statute requires the homeowner to first send a written response via certified mail within 21 days. As Mr. Garcia did not do this, Villagio was under no obligation to provide the observer’s name or the other detailed information outlined in that subsection.
• Sufficiency of Internal Appeal Process: The HOA argued it was exempt from the requirement to provide notice of an administrative hearing because its violation letters fulfilled the statute’s alternative. The letters provided a clear process for contesting the notice, directing Mr. Garcia to a website (http://www.hoacompliance.com/Apoeals) to file an appeal with the Board of Directors.
• Statutory Inapplicability (Argument from Rehearing): During the rehearing, Villagio introduced a new argument that A.R.S. § 33-1242 was not applicable to the dispute at all. They contended the statute addresses violations related to the condition of a property, whereas Mr. Garcia’s violation was a matter of property use (i.e., short-term renting).
• No Prevention of Response: Villagio’s community manager, Tom Gordon, testified that the HOA does not restrict homeowners from responding to notices within the 21-day period. Mr. Garcia also admitted under cross-examination that no court order had prohibited him from sending a response.
Administrative Law Judge’s Findings and Rulings
The Administrative Law Judge (ALJ) sided with the Respondent in both decisions, dismissing the petition based on a strict interpretation of the law and the evidence presented.
Burden of Proof
The ALJ established in both rulings that Mr. Garcia, as the petitioner, bore the burden of proving the alleged violation by a “preponderance of the evidence.” This standard requires evidence that is of greater weight or more convincing than the evidence offered in opposition to it.
Interpretation and Application of A.R.S. § 33-1242
The decisions hinged on a procedural reading of the statute:
1. Response Requirement is a Prerequisite: The ALJ found that the obligations for an HOA under subsection (C) of the statute—including providing the observer’s name, the date of the violation, and the specific rule violated—are expressly conditioned on the unit owner first providing a written response via certified mail within 21 days as stipulated in subsection (B).
2. Internal Appeal Process Satisfies Notice Requirement: The ALJ concluded that under subsection (D), an HOA is only required to provide notice of the option for a state administrative hearing if it has not already provided the process the unit owner must follow to contest the notice.
Rulings and Final Disposition
Based on this legal framework, the ALJ made the following conclusive findings:
• Petitioner Failed to Act: It was undisputed that Mr. Garcia did not respond in writing via certified mail to any of the three notices within the 21-day period. This failure meant Villagio’s statutory duty to provide the observer’s name was never activated.
• No Evidence of Prevention: Mr. Garcia failed to provide evidence showing how the issuance of subsequent notices legally prevented him from responding to the initial notice within its 21-day window. The ALJ found his belief that he only had 10 days was a misinterpretation and did not constitute prevention by the HOA.
• HOA Fulfilled Its Obligation: Villagio’s notices included instructions for contesting the violation through its own internal process. By doing so, Villagio satisfied the requirements of A.R.S. § 33-1242(D) and was therefore not obligated to inform Mr. Garcia of the option to petition for a separate administrative hearing.
• Petition Dismissed: Because Mr. Garcia failed to meet his burden of proof to establish a violation of A.R.S. § 33-1242, his petition was ordered dismissed in both the initial and rehearing decisions. The March 4, 2019, order was deemed binding on the parties, with any further appeal required to be filed with the superior court.
