HOA - ALJDEC decisions

25F-H018-REL · Department of Real Estate - H/C · 2025-03-31

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Allan, Joseph P

Petitioner,

The Springs Condominiums Association

Respondent.

No. 25F-H018-REL

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: March 11, 2025

APPEARANCES: Joseph P. Allan, (hereinafter “Petitioner”), appeared on behalf of himself. Belen Guzman appeared on behalf of The Springs Condominium Association, (hereinafter “Respondent”).

ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson

EXHIBITS ADMITTED INTO EVIDENCE: Petitioner’s Exhibits 1 and 2. Respondent’s Exhibit A.

_____________________________________________________________________

FINDINGS OF FACT

On December 4, 2024, the Arizona Department of Real Estate, (hereinafter “Department”), issued a Notice of Hearing setting the above-captioned matter for hearing on January 14, 2025 at 1:00 p.m., at the Office of Administrative Hearings in Phoenix, Arizona.

The Notice of Hearing provided that the issue set for determination was

whether Respondent violated Arizona Revised Statutes, (hereinafter, “A.R.S.”), section 33-1258, when Petitioner requested “bank statements from four accounts on September 24, 2024, and original invoices for May 2024 on July 29, 2024.”

3. The matter was continued and the hearing was conducted on March 11, 2025.

4. At hearing, Petitioner testified on behalf of himself. Belen Guzman, the owner of Respondent’s property management company, testified on behalf of Respondent.

5. Respondent is a non-profit corporation located in Surprise, Arizona.

6. Petitioner is a member of Respondent.

7. On July 9, 2024, Petitioner requested to examine original invoices for May 2024 from several board members, including the President and the Vice President. The request was sent by e-mail. The request was not sent to Respondent’s property management company.

8. On September 23, 2024, Petitioner requested to examine bank statements from four of Respondent’s accounts. Petitioner sent the request by e-mail to several board members, including the President and the Vice President. The request was sent by e-mail. The request was not sent to Respondent’s property management company.

9. Respondent did not respond to Petitioner’s requests.

10. In or around October of 2024, the Department received a single-issue petition wherein Petitioner alleged that Respondent had violated A.R.S. section 33-1258, when it failed to respond to two requests from Petitioner: (1) a September 24, 2024 request for bank statements from four accounts and, (2) a July 29, 2024 request for original invoices for the month of May 2024.

11. Respondent filed a response to the petition.

12. The matter was referred to the Office of Administrative Hearings for an

evidentiary hearing.

13. At hearing, Petitioner acknowledged that he wrote incorrect dates in the petition: the request for examination of bank statements was made on September 23, 2024; the request for examination of the May 2024 original invoices was made on July 9, 2024. Ms. Guzman acknowledged that she was aware that the dates provided on the petition were incorrect. Ms. Guzman was aware that the correct request dates were September 23, 2024 with regard to the bank statements and July 9, 2024 with regard to the original invoices for May 2024.

14. There was no dispute at hearing that the Board failed to respond to Petitioner’s requests before the petition in the above-entitled matter was filed.

Ms. Guzman testified that such requests for the examination of records must be sent to the property management company. Ms. Guzman stated that Petitioner was a prior member of the Board and was aware that record requests must be sent to the property management company. Ms. Guzman did not dispute that the requests were received by the Board.

15. Ms. Guzman presented evidence at hearing that Petitioner submitted a request for records to the property management company and to several board members on May 27, 2024.

16. Petitioner testified that he did not send the requests to the property management company because he is investigating the company.

17. Petitioner did not dispute that requests are routinely sent to the property management company.

18. It is undisputed that Respondent provided copies of the documents that Petitioner requested to examine on March 10, 2025.

CONCLUSIONS OF LAW

1. A.R.S. section 32-2199(1) permits a condominium unit owner to file a petition with the Department for a hearing concerning the condominium association’s alleged violations of the Condominium Act set forth in Title 33, Chapter 9. This matter lies within the Department’s jurisdiction.

2. Petitioner bears the burden of proof to establish that Respondent violated A.R.S. § 33-1258 (A) by a preponderance of the evidence. Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.

3. “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.”

4. A.R.S. § 33-1258 (A) provides:

A. Except as provided in subsection B of this section, all financial and other records of the association shall be made reasonably available for examination by any member or any person designated by the member in writing as the member's representative. The association shall not charge a member or any person designated by the member in writing for making material available for review. The association shall have ten business days to fulfill a request for examination. On request for purchase of copies of records by any member or any person designated by the member in writing as the member's representative, the association shall have ten business days to provide copies of the requested records. An association may charge a fee for making copies of not more than fifteen cents per page.

5. It is undisputed that Respondent failed to allow Petitioner to examine the

May 2024 original invoices and bank statements from four of Respondent’s accounts, within ten business days as required by A.R.S. section 33-1258(A). Ms. Guzman explained that Respondent would have provided access to the records if Petitioner would have sent the request to the property management company. However, Respondent did present any legal authority to establish that it was not obligated to comply with A.R.S. section 33-1258(A), for the reason that the requests were not sent to Respondent’s property management company. Ms. Guzman eventually received Petitioner’s requests for the examination of records from Respondent’s board members.

6. Upon consideration of the undisputed evidence presented at hearing, the Administrative Law Judge concludes that Petitioner has met his burden of establishing by a preponderance of the evidence that Respondent violated A.R.S. section 33-1258(A) when it failed to allow Petitioner to examine the May 2024 original invoices and bank statements from four of Respondent’s accounts, within ten business days of the date of Petitioner’s requests as required by A.R.S. section 33-1258(A).

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.

IT IS FURTHER ORDERED that Respondent is directed to comply with the

requirements of A.R.S. section 33-1258 (A) going forward.

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 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, March 31, 2025.

/s/ Velva Moses-Thompson

Administrative Law Judge

Transmitted by either mail, e-mail, or facsimile March 31, 2025 to:

Susan Nicolson

Commissioner

Arizona Department of Real Estate

Joseph P. Allen

[email redacted]

The Springs Condominiums Association

[email redacted]

By: OAH Staff