HOA - ALJDEC decisions

25F-H017-REL-RHG · Department of Real Estate - H/C · 2025-07-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the matter of:

Samantha and Millard C. Finch,

Petitioners,

Mountain Gate Community aka Copper Canyon Ranch,

Respondent.

No. 25F-H017-REL-RHG

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: June 13, 2025

APPEARANCES: Samantha Finch represented herself and Millard C. Finch (Petitioners). Attorney B. Austin Baillio represented Respondent.

ADMINISTRATIVE LAW JUDGE: Kay A. Abramsohn

EXHIBITS ADMITTED INTO EVIDENCE: Notice of Re-Hearing File (File), provided by the Department of Real Estate. Petitioners’ Exhibits 1 through 8 and Exhibit A. Respondent’s Exhibits 1 through 8.

_____________________________________________________________________

FINDINGS OF FACT

Background

On or about February 26, 2025, the Arizona Office of Administrative Hearings (Tribunal) issued the Administrative Law Judge Decision (Decision) in the underlying administrative matter, 25F-H017-REL.

The Administrative Law Judge (ALJ) determined that “Respondent be deemed the prevailing party in this matter regarding Petition Issues 1, 2, 3, and 4.”

The ALJ Decision contained the following Notice:

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.

On or about March 28, 2025, Petitioners filed a timely Dispute Rehearing Petition (Dispute Petition), alleging multiple grounds for a rehearing.

Pursuant to A.R.S. § 32-2199.04(B), the filing of a petition for rehearing temporarily suspends the operation of the ALJ’s Decision and, if the petition is granted, the ALJ’s Decision is suspended pending a decision on the rehearing.

After considering Petitioners’ Dispute Petition and Respondent’s Response, on April 29, 2025, the Department issued its Order Granting Re-Hearing and Notice of Re-Hearing (Order). The Department’s Order specified the one ground on which the rehearing had been granted as:

Error in the administration or rejection of evidence or other errors occurring during the proceeding.

Dispute Petition

In their Dispute Petition, Petitioners questioned whether the law used by the ALJ in the Decision had been the correct law.

Post-hearing, Petitioners had requested from the Tribunal copies of the hearing exhibits, and the Tribunal provided copies of exhibits, which were copies of Respondent’s admitted exhibits but not copies of Petitioners’ exhibits. On the PDFs included therein was one, PDF 127089, containing Respondent’s Exhibit #3 which Respondent had labeled as “Statutes.”

In the Dispute Petition, Petitioners noted that the copies of A.R.S. § 33-1807 and A.R.S. § 33-1803 that were thus found within the administrative hearing record (i.e., in PDF 127089) seemed to not have been printed from the same source and, therefore, the copy of the A.R.S. § 33-1807 law utilized by the ALJ: (a) was unsubstantiated and not the same statute that had been admitted into the record; (b) may not have been an authentic representation of A.R.S. § 33-1807; and, (c) the use of such was done so for an improper purpose. Petitioners took the position that the ALJ had “shrouded the unsubstantiated, unverified ARS 33-1807 document in file 127089.pdf as an OAH exhibit,” thereby “usurp[ing]” the “properly presented” version Petitioners had presented with its documents.

When referencing their “properly presented” version, Petitioners were referring to their Attachment 3 to their original Petition filed with the Department, which Attachment was thereby included within the File exhibits forwarded to the Tribunal for the administrative hearing.

As indicated in the ALJ Decision, those background documents were admitted to the February 7, 2025 hearing under “Notice of Hearing File, provided by the Department of Real Estate.” That Attachment 3 is a reprint of the Title 33 Planned Communities laws, which copy is undated and has no source designation.

Petitioners essentially posit that, had the ALJ used their “properly presented” A.R.S. § 33-1807, it would have refuted the Decision determination that Respondent was the prevailing party. Petitioners argue that such Decision, that Respondent was the prevailing party, had “no support in law,” and, therefore, with use of the proper statute, the result would be that Petitioners were, in fact, the prevailing party. Petitioners argue that they did not receive “equal protection of the law” when the “validity of a statute” on which the ALJ based his Decision, was in question.

Respondent’s Response to the Dispute Petition simply noted that the ALJ had relied on the appropriate version of A.R.S. § 33-1807 which had been in effect at the time of the payment actions in question, beginning in 2019, in the underlying matter. Respondent further noted that the 2024 amendments to A.R.S. § 33-1807 became effective on September 14, 2024 and were prospective law changes, and could not have been applicable to payment treatment in the past.

DISPUTE REHEARING

At rehearing, Petitioners acknowledged that the ALJ had admitted their submitted documents to the February 7, 2025 hearing record.

Petitioners expressed the concern that their documents had not been considered, i.e., had been rejected, because Petitioners had not received a copy of their own exhibits when the Tribunal sent them copies of the hearing exhibits. Petitioners argued that they had expected to receive all the documents on which the ALJ had relied in making his Decision, thus alluding to their concern the ALJ had rejected their evidence.

At rehearing, Petitioners’ posited that the Decision was not based on Petitioner’s evidence.

In that regard, Respondent noted that, in his Decision, the ALJ had referenced both exhibits and testimony presented by the parties.

At rehearing, Petitioners alleged the ALJ had either rejected or not considered their submitted evidence because, as an example, the Decision contained a “fact” that was not based on Petitioners’ evidence, inferring that the “fact” was not accurate. Petitioners failed to point to any of their evidence or exhibits to disprove that particular statement of fact in the ALJ Decision.

At rehearing, Petitioners alleged that they were not permitted by the ALJ to pursue evidence regarding a “court order.” In a series of questions regarding the application of payments according to the provisions of A.R.S. § 33-1807(J), the Respondent’s witness indicated Petitioners’ payments had been applied according to that statutory language. When Petitioners then asked whether there had been a court order giving Respondent “authority,” the witness indicated that she did not understand the question. At that point, the ALJ directed Petitioners as follows: “If you’d like to make that argument, you are welcome to do that, but it is sort of asking for a legal conclusion.”

Regarding that exchange, Petitioners argued they were trying to present that evidence through questioning the witness, inferring the ALJ prevented them from presenting evidence.

In regard to that exchange, Respondent argued that, in fact, Petitioners had addressed the “court order” argument in their Closing at the February 7, 2025 hearing.

At the rehearing, regarding the A.R.S. § 33-1807(J) language, Petitioners argued that Respondent had needed the court order or lien called for in A.R.S. § 33-1807 to be able to apply the payments the way it did and that Respondent had not obtained such.

At rehearing, Petitioners argued that, all throughout testimony, the ALJ “allowed” witness answers to become legal conclusions. Further, Petitioners argued they were not given a fair hearing on their evidence.

At rehearing, when Petitioners continued to raise points indicating their disagreement with the ALJ Decision, the Tribunal continued to remind them that their rehearing was limited to the one ground granted by the Department, which was “Error in the administration or rejection of evidence or other errors occurring during the proceeding.”

At rehearing, Petitioners repeatedly stated that they had asked the Department for an extension of time, and had not been given enough time, to prepare their “statement” in response to the Decision, i.e., their disagreement with the Decision. When pressed on this statement, Petitioners indicated that they contacted the Department on May 9, 2025 regarding the requested extension, and the Department informed them the rehearing matter had already been forwarded to the Tribunal.

CONCLUSIONS OF LAW

The rehearing in this matter was conducted in this matter pursuant to A.R.S. § 33-2199.04.

Petitioners bear the burden of proof by a preponderance of the evidence that there was, as they alleged, “error in the administration or rejection of evidence or other errors occurring during the proceeding.”

“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 Administrative Law Judge concludes that Petitioners failed to meet their burden in this rehearing. The rehearing evidence demonstrated that Petitioners’ submitted evidence, for purpose of the February 7, 2025 hearing, was, in fact, admitted to the February 7, 2025 administrative hearing record. Petitioners’ arguments fail that the statutes relied on by the ALJ in his Decision either were unsubstantiated or were not the statutes contained within the February 7, 2025 administrative hearing record. Petitioners failed to present any evidence that they were prevented from presenting any evidence at the February 7, 2025 administrative hearing. Petitioners failed to present any evidence of any errors of law occurring during the February 7, 2025 administrative hearing. The Administrative Law Judge concludes that Petitioners’ Dispute Petition shall by dismissed.

The Department not having granted a rehearing on whether the ALJ’s Findings of Fact or Decision were arbitrary, capricious, an abuse of discretion, not supported by the evidence, or contrary to law, the Administrative Law Judge further concludes that Petitioners’ arguments in disagreement with the ALJ’s Findings of Fact, Conclusions of Law, or Decision were improperly raised in the rehearing and shall be dismissed.

order

IT IS ORDERED that Petitioners’ Dispute Petition is Dismissed.

NOTICE

This administrative law judge order, having been issued as a result of a rehearing, is binding on the parties. A.R.S. § 32-2199.02(B). A party wishing to appeal this order must seek judicial review as prescribed by A.R.S. § 41-1092.08(H) and title 12, chapter 7, article 6. Any such appeal must be filed with the superior court within thirty-five days from the date when a copy of this order was served upon the parties. A.R.S. § 12-904(A).

ORDERED this day, July 3, 2025.

/s/ Kay Abramsohn

Administrative Law Judge

Transmitted by mail and e-mail to:

Susan Nicolson, Commissioner

Arizona Department of Real Estate

[email redacted]

Samantha and Millard C. Finch

14561 W. Sierra Street

Surprise, AZ 85379

[email redacted]

B. Austin Baillio

[email redacted]

By: OAH Staff