ALJDEC decisions subject to certification as final

23F-LTA2223008-ADH · Arizona State Department of Housing - LTA · 2023-11-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Ardis Gloria, et al.,

Petitioners,

Agave Village, et al.,

Respondents.

No. 23F-LTA2223008-ADH

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: October 20, 2023

APPEARANCES: Ardis Gloria appeared on behalf of Petitioners. Scott Baluha, Esq., represented Agave Village, et al.

ADMINISTRATIVE LAW JUDGE: Brian Del Vecchio

FINDINGS OF FACT

On or about July 7th, 2023, Ardis Gloria, et al. (collectively known as Petitioners), filed a Petition for Hearing by the Mobile Home Parks Administrative Law Judge (Petition) through the Department of Housing (Department). The Department provided notice of the Petition to Treehouse Communities with Agave Village, owner of the park, and Alisha Heath with Agave Village, resident manager of the park (collectively known as Respondents) on or about July 27, 2023. Petitioners alleged violations of the Arizona Mobile Home Residential Landlord and Tenant Act (LTA), specifically Ariz. Rev. Stat. §§ 33-1413.01, 33-1413, 33-1414, and § 33-1434.

On or about August 3, 2023, Respondents, through their attorney of record, filed a timely response to the Petition on behalf of Respondents.

On or about August 21, 2023, the Department provided Petitioner a copy of the response to the Petition provided by Respondents.

On or about August 21, 2023, Petitioners filed a reply to Respondents’ response to the Petition requesting a hearing with the Office of Administrative Hearings.

At hearing, Ms. Gloria testified on behalf of Petitioners. Respondents’ exhibits 1 through 3 were admitted and Respondents called Lori Kelly, Administrative Assistant at Agave Village, as a witness.

At hearing, Ms. Gloria testified there were three LTA issues in dispute – utility service fees, alleged unlawful contract provisions, and health and safety issues.

First, residents of Agave Village were charged service fees on their water, electric, trash, and sewer bills without being given a copy of said utility bills from the service providers. Utilities were submetered. Ms. Gloria conceded the water service charge was correct, however, electric, trash, and sewer were incorrect. All residents were charged a service fee for electric. Respondents had one master account with the electricity provider and therefore, residents did not have individual account numbers. Because residents did not have individual account numbers, they were unable to obtain the electric bills directly from the electric company to verify whether the service charges were correct. All bills were sent to Respondents and Respondents billed individual residents. Ms. Gloria admitted the service charge matched.

Second, the lease agreements violate the LTA because they are considered “take it or leave it” and the lease required residents to waive their right to a jury which violated the LTA; Respondents did not negotiate on lease terms.

Finally, Respondents failed to keep the common areas safe because exposed electric lines were visible on the ground and roots from trees broke the septic tanks which caused a sewage leak. The Fire Marshal was called to investigate the electrical lines. The Department of Health Services were called and required Respondents to remedy the sewage leak.

At hearing, Respondents argued nothing in the LTA required landlords to give residents copies of the collective utility bills. Nothing in the LTA prohibited waiver of jury trial as a lease condition. Finally, regarding the health and safety issues, the Fire Marshal investigated the electric wires and green tagged the site. No citation was issued regarding the electrical wires. Regarding the sewage leak, Ms. Gloria agreed the issue was resolved prior to her filing and no citation was issued to Respondents.

CONCLUSIONS OF LAW

The Department has jurisdiction to determine whether Respondents violated the LTA in the actions or inactions alleged in Petitioners’ Petition.

Petitioners bear the burden of proof to establish that Respondents violated the Arizona Mobile Home Residential Landlord and Tenant Act in the manner alleged in the Petition, and that standard is by a preponderance of the evidence. Respondents bear 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.”

The evidence established Petitioners failed to meet their burden with regard to the alleged violation of Ariz. Rev. Stat. § 33-1413.01. It is uncontested the community is submetered. On cross-examination, Ms. Gloria admitted the individual resident service charges for electric, water, and sewer match the service charges in the master billing records for the entire community. Ms. Gloria argued, but failed to provide evidence, the service charge for trash was incorrect. Ms. Gloria asserted prior to filing the complaint, the community was required to deposit their trash in a communal trash receptacle and now each resident has an individual receptacle, however, the trash service charge remained the same. Of the many requirements the LTA places upon landlords, providing individualized statements of service fees were not among them. The LTA instead provides the upper limit of what a landlord may charge for utilities. Petitioners failed to provide evidence Respondents exceeded the prevailing single family residential charge, fee or rate. Therefore, Petitioners failed to establish Respondents violated Ariz. Rev. Stat. § 33-1413.01.

The evidence established Petitioners failed to meet their burden with regard to the alleged violation of Ariz. Rev. Stat. § 33-1414 and Ariz. Rev. Stat. § 33-1413; said statutes enumerate the requirements of a lease between landlord and tenant. Nothing in the LTA prevents Respondents from requiring residents to waive their right to a jury trial. Ariz. Rev. Stat. § 33-1414(A)(1) states “[a] rental agreement shall not provide that tenant agrees to . . . [w]aive or to forgo rights or remedies under this chapter.” In other words, the terms of a rental agreement cannot require a waiver of specific rights protected by the LTA. Petitioners argued the statute prevented Respondents from requiring any waivers or forego rights or remedies. This argument failed to address the key phrase of the statute, “under this chapter”. No provision of the LTA protected the right to a jury trial. Because the waiver of jury trial was not protected by the LTA, Respondents were free to require a waiver. Regarding the “take it or leave it” nature of the contract negotiations, once again there is nothing within Ariz. Rev. Stat. § 33-1414 and Ariz. Rev. Stat. § 33-1413 which limits Respondents’ ability to negotiate leases in such a way. Finally, the Petition implied the “take it or leave it” negotiation resulted in inappropriate rent increases; however, pursuant to Ariz. Rev. Stat. § 41-4064, this Court does not have jurisdiction over matters pertaining to rental increases. Therefore, Petitioners failed to establish Respondents violated Ariz. Rev. Stat. § 33-1414 and Ariz. Rev. Stat. § 33-1413.

The evidence established Petitioners failed to meet their burden with regard to the alleged violation of Ariz. Rev. Stat. § 33-1434. Ms. Gloria admitted both the electrical wire issue and the sewer issues were addressed by the Fire Marshal and the Department of Health Services. Both regulatory agencies conducted investigations into the health and safety concerns and failed to cite Respondents. Regarding the sewage leak, while it may be true there was a health concern, it was remediated by Respondents and the Department of Health Services did not cite Respondents. Therefore Petitioners failed to establish Respondents violated Ariz. Rev. Stat. § 33-1414 and Ariz. Rev. Stat. § 33-1434.

RECOMMENDED ORDER

IT IS ORDERED that the Director of the Department dismiss Petitioners’ petition against Respondents.

In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be forty (40) days from the date of that certification.

-54864001

001

-137160-45720000Done this day, November 9, 2023.

/s/ Brian Del Vecchio

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile to:

Joan Serviss, Director

Arizona Department of Housing

Ardis Gloria

[email redacted]

Scott A. Baluha

Zona Law Group P.C.

[email redacted]

By: OAH Staff