ALJDEC decisions subject to certification as final

20F-H2020063-REL · Department of Real Estate - H/C · 2020-12-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Marc Archer,

Petitioner,

vs.

PMPE Community Association, Inc.,

Respondent.

No. 20F-H2020063-REL

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: November 13, 2020

APPEARANCES: Petitioner Marc Archer appeared on his own behalf. Respondent PMPE Community Association, Inc. was represented by Nicholas Nogami.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

Respondent PMPE Community Association, Inc. (PMPE) is an association of homeowners located in Glendale, Arizona.

Petitioner Marc Archer owns a residence in and is a member of PMPE.

In 2017 or 2018, Petitioner began the process of getting approval for his plans to build a 12 foot high garage structure to be added onto the back of his house.

The Board issued a preliminary approval of Petitioner’s plans.

However, the Board did not issue a final approval of Petitioner’s plans after the Board learned that Petitioner planned to construct a flat roof to the garage addition which would be enclosed on all sides, with a height that would exceed the height of the adjoining wall. Although Petitioner’s existing garage roof was pitched, Petitioner did not want to construct a pitched roof on his garage addition.

As a result, the Board notified Petitioner that he could construct a flat roof on his garage addition if the height of the roof was below the height of the adjacent wall, so that the flat roof would not be visible to neighboring properties, pursuant to PMPE’s Covenant, Conditions, and Restrictions (CC&Rs).

On or about May 10, 2019, Petitioner filed a petition with the Arizona Department of Real Estate (Department) alleging that PMPE had violated Arizona Revised Statutes A.R.S. § 33-1817(B)(3) by unreasonably withholding approval of his plan for a garage addition with a flat roof that would exceed the height of the adjacent wall.

The matter was referred to the Office of Administrative Hearings for an evidentiary hearing. Following the hearing, Administrative Law Judge Velva Moses-Thompson ruled in favor of PMPE.

Petitioner subsequently filed a new request with PMPE for a two-story addition with a pitched roof. Petitioner obtained professional renderings of the plans and submitted the request to the Architectural Committee (AC).

On or about February 5, 2020, the AC held meeting at Petitioner’s home that was deemed to be the Pre-Design Meeting. Generally, Pre-Design Meetings are held in advance of plans being drawn up or extensive work being done by the homeowner. However, Petitioner had the professional renderings of the proposed addition, so those were reviewed at the Pre-Design Meeting. After review, the AC requested additional changes to the plans and one member requested a model of the proposed addition.

On or about April 6, 2020, Petitioner set up a table at the end of his driveway with all the plans and some demonstrable samples to allow community members to review the proposal. This presentation was intended to serve as the Preliminary Submittal.

On or about April 10, 2020, the AC conducted a conference call during which the members discussed Petitioner’s proposal as its Preliminary Review. At the outset of the discussion, at least two members expressed their concerns with how Petitioner was planning to use the new addition. Specifically, the members were concerned Petitioner was going to accumulate more “junk”. Two of the members expressing concerns ultimately voted against Petitioner’s proposal. Another member of the AC questioned Petitioner’s plan to paint the new roof tile to match his existing roof tile and how that would look on the home. The AC members also expressed a concern that Petitioner did not intend to tie the new roof into the existing roof. Ultimately, the majority of the members of the AC voted to deny Petitioner’s proposal as it was submitted.

Following the Preliminary Review, neither the decision nor the basis of the decision was communicated to Petitioner. Petitioner was on the call during the discussion, but he was not provided a written explanation of the reason for the denial.

On or about May 27, 2020, Petitioner filed a Homeowners Association (HOA) Dispute Process Petition alleging that PMPE had violated the provisions of A.R.S. § 33-1817(B)(3). Specifically, Petitioner indicated “Petitioner has repeatedly tried to get approval for a structure addition on his house and has been repeatedly denied by Architectural committee even though previously requested details by committee have been incorporated in the new design meeting the architectural guidelines as well as committees requests.”

At hearing, Petitioner contended that the design plan for his proposed addition was harmonious with the surrounding structures and incorporated all the suggestions the AC made as to his single story proposal. Petitioner stated that he did not tie in the roof of the addition because it was not financially reasonable to do so and the design of the new addition did not require it to be tied in. Petitioner presented a demonstrable exhibit to show that the painted tile was indistinguishable from the original tile and stated that the only reason he was required to paint the new tile was because it was not possible to purchase tile to match the existing tile. Petitioner argued the paint technique employed was similar painting stucco in that it was specially formulated for painting concrete. Petitioner also asserted that PMPE did not consistently enforce the CC&Rs as to all homeowners, but required his strict compliance. Petitioner posited that because his neighbor was influential, Petitioner was targeted when he proposed the addition. Petitioner also noted that he had previously been cited for being in violation of the CC&Rs as it related to his restoration of vehicles, but maintained he was not in violation at the time of the AC meeting or at the time of the hearing. Petitioner argued that his intended use of the addition should have no effect of the AC’s decision as to his proposal. Petitioner maintained that the addition was approximately one tenth the size of his house and represented a “minor addition”.

At hearing, Keith Kauffman, President, Treasurer, and AC member, testified that the AC denial was not based on the potential use of the addition, but an overall concern with how the addition looked. Mr. Kauffman stated that the goal of the AC was to ensure that any additions looked like they had always been a part of the structure. Mr. Kauffman particularly pointed out that the painting of the roof tiles was not expressly permitted by the guidelines and therefore, he believed it was not allowed. Mr. Kauffman acknowledged that the AC did not provide any written communication to Petitioner after the April vote.

CONCLUSIONS OF LAW

The ADRE has authority over this matter. See A.R.S. Title 32, Ch. 20,

Art. 11.

At an administrative hearing, the party asserting a claim, right, entitlement, or affirmative defense has the burden of proof, and the standard of proof on all issues in this matter is that of a preponderance of the evidence. Arizona Administrative Code R2-19-119.

A preponderance of the evidence is:

The greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.

Black’s Law Dictionary 1373 (10th ed. 2014).

The CC&Rs are a contract between the parties and the parties are required to comply with its terms. See Johnson v. The Pointe Community Association, 205 Ariz. 485, 73 P.3d 616 (App. 2003).

In Arizona, when a restrictive covenant is unambiguous, it is enforced to give effect to the intent of the parties. See Powell v. Washburn, 211 Ariz. 553, 556 ¶ 9, 125 P.3d 373, 376 (2006); see also Grubb & Ellis Management Services, Inc. v. 407417 B.C., L.L.C., 213 Ariz. 83, 138 P.3d 1210 (App. 2006) (the tribunal must give effect to a contract’s clear and unambiguous terms).

An association shall not unreasonably withhold approval of a construction project’s architectural plans. See A.R.S. § 33-1817(B)(3).

Article 5.10 of the PMPE CC&Rs provides, in relevant part, as follows:

The Board may appoint an Architectural Committee to perform certain architectural control functions set forth in this Declaration. . . . The Board, or the Architectural Committee if so appointed, may promulgate architectural guidelines, standards and procedures to be used in rendering its decisions. Such guidelines standards and procedures may include, without limitation, provisions regarding: (i) architectural design, with particular regard to the harmony of the design with the surrounding structures and topography.

Section 4.4 of the PMPE Architectural Rules provides, in relevant part, as follows:

Since roofscapes will form an important part of the visual environment, they must be carefully designed. It is intended that pitched roofs predominate.

The PMPE Architectural Rules outlines the review and approval process, in pertinent part, as follows:

2.1 INTRODUCTION

In order to assist each Owner and/or Builder in the planning and designing of his Residence to take full advantage of the unique opportunities of his Lot, a comprehensive design review process administered by the Committee has been established. In general, the design review process is divided into five phases: The Pre-Design Meeting, the Preliminary Submittal, the Final Submittal, the Construction Permit, and the Final Inspection. . . .

The following is a procedural walk-through of the Review and Approval Process.

2.2 PRE-DESIGN MEETING

To initiate the review and approval process prior to preparing any drawings for a proposed Improvement, it is recommended that the Owner and/or his Architect meet with a representative of the Committee to discuss the proposed Residence and to explore and resolve any questions regarding building requirements in Phoenix Mountain Preserve Estates or interpretation of the Architectural Rules. . . .

2.3 PRELIMINARY SUBMITTAL

Preliminary drawings, including all of the exhibits outlined below, must be submitted to the Committee before they will be considered for review. The Preliminary Submittal shall include the following . . . .

2.4 PRELIMINARY REVIEW

After any staking of the Lot that may be required, the Preliminary Submittal will be deemed complete. The Committee will then review the submittal for conformance to these Architectural Rules and make its recommendation which will provide a written response to the Owner.

2.5 FINAL SUBMITTAL

After preliminary approval is obtained, the following documents are to be submitted to the Architectural Committee for final approval . . . . .

2.6 FINAL APPROVAL

Upon receipt of the complete Final Submittal, the Committee will review the submittal for conformance to these Architectural Rules, and to any preliminary approval stipulations and make its recommendation and will provide a written response to the Owner, which may include stipulations or requirements which must be complied with by Owner.

Emphasis added.

While Petitioner may have bypassed the Pre-Design Meeting prior to developing plans, such a meeting was held on February 5, 2020. The Preliminary Submittal was completed on April 6, 2020. The Preliminary Review was held during the telephone conference on April 10, 2020. Following the Preliminary Review, the AC did not provide a written response to Petitioner as required by the PMPE Architectural Rules.

The preponderance of the evidence provided at hearing established that the AC reviewed the plans and specifications submitted by Petitioner for the construction of an addition and made a preliminary determination that the proposal would be denied, but failed to communicate that denial to Petitioner in a manner consistent with the CC&Rs and PMPE Architectural Rules.

Without a written response regarding the preliminary review, it would be considerably more difficult for Petitioner to amend his plans prior to the Final Submittal to address the concerns of the AC in an effort to secure approval.

Upon consideration of all of the evidence presented at hearing, the Administrative Law Judge concludes that Petitioner established by a preponderance of the evidence that PMPE failed to comply with its own CC&Rs and the PMPE Architectural Rules in a manner that constituted a violation of A.R.S. § 33-1817(B)(3).

Nothing in this decision should be construed to mean that Respondent is required to approve Petitioner’s proposal. Rather, Respondent is required to follow the process set forth in the community documents.

order

IT IS ORDERED that Petitioner be deemed the prevailing party in this matter.

IT IS FURTHER ORDERED that Respondent pay Petitioner his filing fee of $500.00, to be paid directly to Petitioner within thirty (30) days of this Order.

No Civil Penalty is found to be appropriate in this matter.

NOTICE

Pursuant to A.R.S. § 32-2199.02(B), this Order is binding on the parties unless a rehearing is granted pursuant to Ariz. Rev. Stat. section 32-2199.04. Pursuant to A.R.S. § 41-1092.09, a request for rehearing in this matter must be filed with the Commissioner of the Department of Real Estate within 30 days of the service of this Order upon the parties.

-54864001

001

-137160-45720000Done this day, December 3, 2020.

/s/ Tammy L. Eigenheer

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile this December 3, 2020, to:

Judy Lowe, Commissioner

Arizona Department of Real Estate

100 N. 15th Avenue, Suite 201

Phoenix, Arizona 85007

[email redacted]

Marc Archer, Petitioner

8619 N 17th Pl

Phoenix, AZ 85020

[email redacted]

PMPE Community Association

c/o Carlotta L Turman & Nicholas Nogami

Carpenter, Hazelwood, Delgado & Bolen

1400 E Southern Ave, Ste. 400

Tempe, AZ 85282-5691

[email redacted]

-54864001

001

-137160-45720000By f. del sol