HOA - ALJDEC decisions

23F-H054-REL · Department of Real Estate - H/C · 2023-07-28

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Felicia Woodward

Petitioner

The Pointe South Mountain Residential Association,

Respondent

No. 23F-H054-REL

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: July 14, 2023

APPEARANCES: Petitioner Felicia Woodward appeared via Google Meet. Respondent Pointe South Mountain Residential Association was represented by Jonathan D. Ebertshauser Esq. and Marcus R. Martinez, Esq. who appeared via Google Meet.

ADMINISTRATIVE LAW JUDGE: Adam D. Stone

_____________________________________________________________________

After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Order to the Commissioner of the Arizona Department of Real Estate (“Department”).

FINDINGS OF FACT

Background and Procedure

The Department is authorized by statute to receive and to decide petitions for hearings from members of homeowners’ associations and from homeowners’ associations in Arizona.

On or about April 4, 2023, Petitioner filed a single-issue petition against the Association with the Department. Petitioner tendered $500.00 to the Department with his petition.

On or about May 2, 2023, the Pointe South Mountain Residential Association (“Association”) filed its Answer with the Department whereby it denied all complaint items in the petition.

Per the Notice of Hearing, the Department referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing on July 14, 2023, regarding the following issue based on Petitioner’s petition:

Petitioner alleges the Respondent has violated A.R.S. § 33-1804 by holding a meeting that ‘had not been properly noticed...’

The Parties and Governing Documents

Respondent is a homeowners’ association whose members own properties in a residential real estate development located in Phoenix, Arizona.

Petitioner is a property owner and a member of the Association.

The Association is governed by its Covenants, Conditions, and Restrictions (“CC&Rs”), and overseen by a Board of Directors (“the Board”). The Association is also regulated by Title 33, Chapter 16, Article 1 of the Arizona Revised Statutes (“Ariz. Rev. Stat.”)

Hearing Evidence

Petitioner testified on her own behalf and presented three exhibits. Respondent called Erin Busey as a witness and submitted five exhibits into evidence. The Agency Record from the Department and Notice of Hearing were also admitted into the evidentiary record.

Petitioner’s testimony

Petitioner testified that there was not proper notice given of the Courthome Improvement Workshop meeting on March 16, 2023.

Petitioner testified further that while she received the survey contained in Respondent’s Exhibit A well in advance of 48 hours prior to the meeting, it would still have failed under the statute as the notice and link did not provide a location for the meeting.

In addition, Petitioner offered her Exhibit 3, as proof that no meeting was listed on her calendar on her homepage of the community portal.

Finally, Petitioner testified that so many people missed the meeting because it was not properly noticed, and decisions were made that effected the entire community. Too, one of the board members voiced their concern at the meeting that there may not have been proper notice given to the community.

Erin Busey’s testimony

Ms. Busey was the General Manager for the community had had been for approximately one year. She testified that the Association uses “connect” to inform the community about meetings as well as newsletters, the community calendar or email.

Ms. Busey testified that this was the fourth workshop held, and that the survey with the meeting information was sent out to community members via e-mail at least 48 hours in advance.

Further, Ms. Busey testified as to the fact that her calendar had the meeting listed when she opened the “day view”. Ms. Busey testified that the entire series of these workshops were added to the calendar all at the same time, and that she believed that if each owner clicked on the “day view” the workshop meeting would have appeared.

In addition, Ms. Busey testified that a reminder notice was sent out the day of the workshop with the Zoom link, which was considered the “location” of the meeting.

Finally, Ms. Busey testified that on March 7, 2023, Petitioner opened the email containing the survey and clicked on the “Survey” link.

Conclusions of Law

This matter lies within the Department’s jurisdiction. Pursuant to Ariz. Rev. Stat. §§ 32-2102 and 32-2199 et al., regarding a dispute between an owner and a planned community association, the owner or association may petition the department for a hearing concerning violations of community documents or violations of the statutes that regulate planned communities as long as the petitioner has filed a petition with the department and paid a filing fee as outlined in Ariz. Rev. Stat. § 32-2199.05.

Pursuant to Ariz. Rev. Stat. §§ 32-2199(2), 32-2199.01(D), 32-2199.02, and 41-1092, OAH has the authority to hear and decide the contested case at bar.

In this proceeding, Petitioner bears the burden of proving by a preponderance of the evidence that Respondent violated Ariz. Rev. Stat. § 33-1804(D).

“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.”

Ariz. Rev. Stat. § 33-1804(D) provides, in relevant part, as follows:

D. Notwithstanding any provision in the declaration, bylaws or other community documents, for meetings of the board of directors that are held after the termination of declarant control of the association, notice to members of meetings of the board of directors shall be given at least forty-eight hours in advance of the meeting by newsletter, conspicuous posting or any other reasonable means as determined by the board of directors. An affidavit of notice by an officer of the corporation is prima facie evidence that notice was given as prescribed by this section. Notice to members of meetings of the board of directors is not required if emergency circumstances require action by the board before notice can be given. Any notice of a board meeting shall state the date, time and place of the meeting. The failure of any member to receive actual notice of a meeting of the board of directors does not affect the validity of any action taken at that meeting.

The tribunal finds that Petitioner has not met her burden. First, the tribunal was not convinced that this was a “meeting of the board of directors” under the statute. All advertisements, flyers, postings, etc., clearly stated workshop in which comments as well as review of the survey results would be discussed. There was no expectation that items would be voted on or decisions made. Further, from the evidence and testimony provided, Petitioner opened the email regarding the survey and clicked on the link on March 7, 2023, a week prior to the workshop. Therefore, even if this were considered a “board meeting” Petitioner would have had sufficient notice.

ORDER

IT IS ORDERED that Petitioner’s petition in this matter be denied.

IT IS FURTHER ORDERED pursuant to Ariz. Rev. Stat. § 32-2199.02(A), Respondent shall not reimburse Petitioner’s filing fee as required by Ariz. Rev. Stat. § 32-2199.01.

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, July 28, 2023.

/s/ Adam D. Stone

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile July 28, 2023 to:

Susan Nicolson

Commissioner

Arizona Department of Real Estate

100 N. 15th Avenue, Suite 201

Phoenix, Arizona 85007

Attn:

[email redacted]

Felicia Woodward

8661 S 51st St #1

Phoenix AZ 85044

[email redacted]

Jonathan D. Ebertshauser, Esq.

Marcus R. Martinez, Esq.

Carpenter, Hazlewood, Delgado, & Bolen

1400 E Southern Ave, Suite 400

Tempe, AZ 85282

[email redacted]

By: OAH Staff