HOA - ALJDEC decisions

23F-H008-REL · Department of Real Estate - H/C · 2022-11-17

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Amy Hilburn,

Petitioner,

Stetson Valley Owners Association,

Respondent.

No. 23F-H008-REL

ADMINISTRATIVE LAW JUDGE

DECISION

HEARING: November 9, 2022

APPEARANCES: Petitioner Amy Hilburn appeared on her own behalf. Melissa Doolan, Esq. represented Respondent Stetson Valley Owners Association. Danielle Miglio and Ann Renee Wilsey appeared as witnesses for Respondent.

ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella

FINDINGS OF FACT

On or about August 19, 2022, Petitioner Amy Hilburn filed a Homeowners Association (HOA) Dispute Process Petition (“Petition”) with the Arizona Department of Real Estate (“Department”) alleging a violation of statute and community documents by Respondent Stetson Valley Owners Association. Petitioner indicated a single issue would be presented, paid the appropriate $500.00 filing fee, and asserted a violation of A.R.S. § 33-1804 and Article 6.2 of the Bylaws.

On or about September 28, 2022, the Department issued a Notice of Hearing in which it set forth the issue for hearing as follows:

Petitioner states: “The Associations’ Architectural Review Committee is not holding open meetings where homeowner members have an opportunity to comment prior to a vote of the committee members” in violation of A.R.S. § 33-1804 and Article 6.2 of Stetson Valley Owners Association’s Bylaws.

At hearing, Petitioner testified on her own behalf and Respondent presented the testimony of Danielle Miglio, Community Manager, and Ann Renee Wilsey, Architectural Review Committee Member. Based on the evidence presented at hearing, the following occurred:

From 2011 until February 2022, the Architectural Review Committee (“ARC”) held regularly scheduled meetings on the first Tuesday of every month. Respondent’s Meeting Minutes from June 22, 2017, June 28, 2018, January 30, 2019, July 15, 2020, and July 21, 2021, demonstrate that the ARC had regularly scheduled meetings.

Respondent’s online calendar demonstrated that the ARC had regularly scheduled meetings in 2021.

Respondent’s online Paint Architectural Change Request Form states on the bottom: “The Architectural Committee reviews applications on the first Tuesday of every month.”

On April 4, 2022, June 8, 2022, and July 12, 2022, open meetings of the ARC were held.

Danielle Miglio has been Respondent’s Community Manager since February 2022, when Respondent hired Oasis Community Management “Oasis.” Ms. Miglio testified that since August 2022, the ARC has not held regularly scheduled meetings because the ARC conducts its business through an online portal. Ms. Miglio clarified that the current Paint Architectural Change Request Form should not contain language concerning regularly scheduled meetings, and that this language would be removed from the form as it is inaccurate information.

Ann Renee Wilsey testified that she has been an ARC member for seven years. Ms. Wilsey testified that beginning in March 2022, the ARC began processing ARC requests through an online portal based on the recommendation of Oasis. This change was made in order to provide homeowners with a faster turnaround time of their requests.

Ms. Wilsey explained that the members are notified of an ARC request via email. Each ARC member can view the request in their own time and vote based upon the provisions of the CC&Rs. If an ARC member has a question regarding the request, the member emails Ms. Miglio who contacts the homeowner to seek clarification. Members of the ARC have the ability to comment to each other through the portal and vote on the requests through the portal.

Ms. Wilsey testified that there is no regularly scheduled time to look at the requests, comment, and/or vote.

Petitioner argued that the ARC members’ ability to comment outside of a public meeting is in contradiction to the legislation.

Respondent argued that because the ARC no longer has regularly scheduled meetings, there can be no violation.

CONCLUSIONS OF LAW

Arizona statute permits an owner or a planned community organization to file a petition with the Department for a hearing concerning violations of planned community documents or violations of statutes that regulate planned communities. That statute provides that such petitions will be heard before the Office of Administrative Hearings.

Petitioner bears the burden of proof to establish that Respondent committed the alleged violation by a preponderance of the evidence. Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” A preponderance of the evidence is “[t]he 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.”

A.R.S. § 33-1804(A) provides the following:

Notwithstanding any provision in the declaration, bylaws or other documents to the contrary, all meetings of the members' association and the board of directors, and any regularly scheduled committee meetings, are open to all members of the association or any person designated by a member in writing as the member's representative and all members or designated representatives so desiring shall be permitted to attend and speak at an appropriate time during the deliberations and proceedings.

Emphasis added.

Article 6.2 of Respondent’s Bylaws pertaining to Committees of the Board, states the following: “The provisions of the Bylaws governing meetings, action without meetings and notice, waiver of notice, quorum and voting requirement of the Board shall also apply to committees and their members.”

The credible and probative evidence of record established that in the instant matter, prior to the ARC utilizing the online portal system, the ARC was holding regularly scheduled meetings. However, since March 2022, the ARC has not been holding regularly scheduled meetings and nothing in the provisions cited by Petitioner require the ARC to hold regularly scheduled meetings. If the ARC resumes regularly scheduled meetings, those meetings would be required to be open to all members of the association.

Accordingly, Petitioner failed to sustain her burden to establish a violation by Respondent of A.R.S. § 33-1804(A) or Article 6.2 of Respondent’s Bylaws.

ORDER

IT IS ORDERED that Petitioner’s Petition is dismissed.

NOTICE

Pursuant to A.R.S. §32-2199.02(B), this Order is binding on the parties unless a rehearing is granted pursuant to A.R.S. § 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, November 17, 2022.

/s/ Sondra J. Vanella

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile November 17, 2022 to:

Louis Dettorre, Commissioner

Arizona Department of Real Estate

100 N. 15th Avenue, Suite 201

Phoenix, Arizona 85007

Attn:

[email redacted]

Amy Hilburn

5135 W. Headstall Trl.

Phoenix AZ, 85083

[email redacted]

Travis Law Firm PLC

10439 S. 51st St. Ste. 205

Phoenix AZ 85044

[email redacted]

By: Miranda Alvarez

Legal Secretary