ALJDEC decisions subject to certification as final

25F-LTA2525001-ADH · Arizona State Department of Housing · 2025-07-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Jeffery Orth, et al.,

Petitioner,

vs.

Highland Terrace MHP, et al.,

Respondent.

No. 25F-LTA2525001-ADH

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 22, 2025, and June 23, 2025.

APPEARANCES: Jeffery Orth (“Petitioner”) appeared on his own behalf with Sharon Gannuscio as a witness. Scott Baluha, Esq. appeared on behalf of Highland Terrace Mobile Home Park (“Respondent” and “Park”) with James Christopher Valimont and Julie Onstott as witnesses. Chris Rockwell observed.

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

EXHIBITS ADMITTED INTO EVIDENCE: The Notice of Hearing, including the referring agency’s administrative file, Petitioner Exhibits 1-27, Respondent Exhibits 1-47, and Further Hearing Order dated May 27, 2025, were admitted into the evidentiary record. _____________________________________________________________________

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 Recommended Order to the Director of the Arizona Department of Housing (“Department.”)

FINDINGS OF FACT

Background and Procedure

On or about March 17, 2025, the Department received a Complaint and Petition for Hearing from Petitioner against Respondent for alleged violation(s) of the Arizona Mobile Home Residential Landlord and Tenant Act (“LTA”); Ariz. Rev. Stat. §§ 33-1401 through 33-1501. Specifically, Petitioner alleged that the Park failed to perform repairs and/or maintain the premises in a fit, safe, and habitable manner, and that the Manager failed to complete required educational training in violation of Ariz. Rev. Stat. §§ 33-1434(2), 33-1434(3), 33-1437(A), and 33-1437(B). Sharon Gannuscio, Petitioner’s mother, joined the complaint as a co-petitioner.

On March 17, 2025, the Department provided notice of the petition to Respondent.

On April 02, 2025, Respondent submitted its timely reply to the Department.

On April 02, 2025, the Department provided Respondent’s reply to Petitioner.

On April 03, 2025, Petitioner advised the Department that he was dissatisfied with the Park’s reply and desired to move forward with an administrative hearing.

On April 04, 2025, the Department referred this matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing to determine whether ground exist for the Department to find that Respondent violated Ariz. Rev. Stat. §§ 33-1434[(A)](2), 33-1434[(A)](3), 33-1437(A), and/or 33-1437(B).

On April 08, 2025, the Department issued a Notice of Hearing, setting a hearing on May 22, 2025, at 9:00 a.m.

Hearing Evidence

At the hearing, Petitioner testified on his own behalf and called Ms. Gannuscio as a witness. Respondent called James Christopher Valimont and Julie Onstott as witnesses. The substantive evidence of record is as follows:

The Park is a 55+ age-restricted community in Phoenix, Arizona. It is comprised of 66 manufactured homes. There are no sidewalks. The Park has been family owned since 1971. In 2006, Ms. Onstott and her sister took ownership over the Park after the prior owners, their parents, passed away.

On December 31, 2007, Ms. Gannuscio and her mother, Edythe Bumgarner, then ages sixty-seven (67) and eighty-eight (88), respectively, executed a lease agreement with the Park for Lot #23 at 11811 N. 19th Ave. Phoenix, Arizona 85029, for their 1972 Silvercrest 24x56 manufactured home at $285.04 monthly rent. The Rental Agreement included the following terms, in pertinent parts:

2. OCCUPANCY INFORMATION. Residents shall provide to Management, from time to time, upon written notice from Management, accurate and complete responses to any Residency Questionnaire relating to: the names and ages of the occupants of the Lot; the legal owners and lienholders of Resident’s home; Insurance’ copies of the title, ownership or purchase documents for Resident’s home; information on all pets/animals at the Lot; any vehicles owned, operated or used by Resident or stored or parked in the Community; and other information that is reasonably requested by Management.

3. INITIAL TERM OF THIS AGREEMENT. The Community has established a standard tenancy anniversary term of January 1 through December 31 of each year. In order to comply with the Anniversary Date of January 1 (the “Anniversary Date”), the Initial Term of this Rental Agreement shall begin on the Commencement Date above and terminate at midnight on December 31, following the Commencement Date (whether or not a complete 12 months) (the “Initial Term”).

4. TWELVE MONTH RENEWAL TERMS. After the Initial Term and unless this Agreement is terminated, modified, replaced, superseded or not renewed, this Rental Agreement and tenancy shall automatically renew on January 1 of each year (the “Renewal Date”) which shall be treated as entering into a new Rental Agreement for the Renewal Term. Each Renewal Term shall be for 12 months beginning on January 1 and ending on the following December 31 (the “Renewal Term”). If Resident does not request a four year rental term and should Management and Resident disagree on the term of the renewal the Renewal Term shall be 12-months pursuant to A.R.S. § 33-1413(H). Renewal of this Rental Agreement and the commencement of a Renewal Term shall automatically occur unless Resident gives Management written notice (of their intent not to renew their tenancy) on or before December 1 preceding a Renewal Date or unless notice of non-renewal, termination, a changed rental term or a new or superseded rental agreement is given by Management.

* * *

19. GUESTS AND VISITORS.

The terms “Guest” and “Visitor” shall have the meanings set forth in the Mobile Home Act and shall also mean any licensee, permitee, invitee or other person within the Community at the request, invitation or tolerance of Resident, or who are in the Community for purposes of communicating with Resident or their Guests or Visitors. Guests and other occupants shall not reside at or stay overnight at Resident’s Lot without Resident being present. Management reserves the right to prohibit any Guest, Visitor, occupant or invitee. The foregoing provisions do not apply to prescribed caregivers.

20. PRESCRIBED CAREGIVERS/IMPAIRMENTS.

Pursuant to A.R.S. § 33-1413.03, a Resident may have one person occupy Resident’s home on a temporary basis to provide necessary live-in health care pursuant to a physician’s written treatment plan. Management may require written renewal of the physician’s treatment plan every six months to confirm the continuing need for a caregiver. A caregiver is not a resident, has no rights of tenancy, is not subject to a guest fee and must vacate the premises if Resident’s medical need for a caregiver should cease.

(Emphasis in original.)

At the time they took occupancy, Ms. Gannuscio and Ms. Bumgarner received a copy of the Park’s Rules & Regulations, which provides in section (1)(M) that complaints must be submitted to Management or the Community Owner in writing, signed by the Resident, and include the Resident’s contact information. Section (1)(M) also notes that Management is tasked with investigating and responding to complaints, but that residents may escalate concerns directly to the Community Owner.

When Ms. Gannuscio and Ms. Bumgarner entered their Rental Agreement with the Park in 2007, Rod Gander was the Manager. Sometime in 2018, Mr. Valimont became the Park’s new Manager (“Mngr. Valimont”). He did not review the Park’s existing leases for any residents at that time. Mngr. Valimont last recertified his Arizona Mobile Home Parks Residential Landlord and Tenant Act Manager Certification on November 17, 2023. The certification is displayed in Mngr. Valimont’s office, which is in his residence at Lot #55.

In 2015 Petitioner moved into Lot #23 with his mother, Ms. Gannuscio, and his grandmother, Ms. Bumgarner. In 2019 Ms. Bumgarner passed away, leaving Petitioner and Ms. Gannuscio as the sole residents of Lot #23.

In or around 2019, the Park began a voluntary overhaul of its plumbing system, in sections, because the clay pipes were “old, crushed, and broken” underground. The Park’s plumbing was last updated in the 1970s. No notice of the project was provided to residents, nor was an anticipated date of completion provided once the project commenced. The project, which is ongoing with an unknown anticipated date of completion, is being undertaken by a single plumber who is excavating the main water line, 4-5 homes at a time, and replacing pipes and patching the areas with blacktop. Orange safety cones, plywood, and piles of dirt are being utilized to section off active constructions sites in the Park. The project is moving slowly due to a number of factors, including limited funds to cover the expense(s) associated with the project. Ms. Onstott has spent $109,000.00 thus far on the project. Work was last performed in 2024, with the “last leg” of the project remaining. It is intended for the roadways to be paved over once the project is complete.

Although he had concerns regarding perceived project safety concerns in 2019, Petitioner did not submit his first complaint to Mngr. Valimont until 2023, whereby he was unsatisfied with the response received.

On July 03, 2023, Ms. Gannuscio penned a letter to Ms. Onstott to opine that during the preceding 3.5-4 years the Park’s appearance had “deteriorated,” and lots with travel trailers and campers “detracted” from other mobile homes. The letter continued that “digging and trenching” for the past 2 years made the Park look like a “war zone,” and that when Ms. Gannuscio complained to Mngr. Valimont he told her to move if she was unhappy. Although Ms. Onstott was specifically requested to reply, she did not. Instead, she instructed Mngr. Valimont to address Ms. Gannuscio’s concerns. She was dissatisfied with the response received.

No additional complaints were submitted to the Park by Petitioner or Ms. Gannuscio.

Petitioner filed the current action approximately three (3) days after being served an Eviction Notice by the Park on March 11, 2025, for having an “unauthorized occupant.”

Additional Evidence

The Park has not signed Ms. Gannuscio to a new lease since 2007, nor has she requested one since that time.

Sometime in 2015, Petitioner submitted to a background check during his tenancy application for the Park, the results of which are unknown. Petitioner never received formal confirmation that his application had been approved or denied.

Ms. Gannuscio has never been issued a Residency Questionnaire by the Park, despite Mngr. Valimont being aware that Petitioner has resided with her at Lot #23 since 2019.

Neither Petitioner nor Ms. Gannuscio has ever notified the Park of personal injuries sustained by them or any of their guests or invitees since construction began. Nor have they ever complained that said construction project prevented the ingress or egress to their residence, or interfered with their utilities.

Closing Arguments

In closing, Respondent argued that “fit and habitable,” though not defined by statute, was generally accepted to mean “safe, suitable, and in good repair.” Respondent argued that Petitioner’s concerns were cosmetic and not substantive, as no complaints had been filed during the number of years Petitioner’s grievances were alleged to have existed, and no reports of injuries had been made during that time. Respondent opined that it could not be disciplined or otherwise penalized for taking longer than desired for completing the underlying plumbing project.

In closing, Petitioner argued that the project created dangerous conditions throughout the Park and were not just cosmetic. Petitioner argued that an older population was more prone to accidents around areas of open construction, and that the Park’s undertaking of a voluntary project did not exempt it from its duty to maintain a safe premises. Petitioner further argued that the Park could not take an indefinite period of time to complete the underlying project.

CONCLUSIONS OF LAW

The Department has jurisdiction to determine whether Respondent violated the LTA, as alleged in Petitioner’s petition. The matter was properly brought before OAH for adjudication.

Petitioner bears the burden of proof to establish Respondent’s alleged statutory violation(s) by a preponderance of the evidence. Respondent bears the burden of persuasion 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.”

Ariz. Rev. Stat. § 33-1434 provides, in pertinent parts, as follows:

The Landlord shall:

2. Make all repairs and do whatever is necessary to put and keep the premises in a fit and habitable condition.

3. Keep all common areas of the premises in a clean and safe condition.

Ariz. Rev. Stat. § 33-1437(A-B) provides that [wi]thin six months after employment as a park manager, a park manager shall complete at least six hours of educational programs and shall complete at least six additional hours of educational programs every two years. A park manager shall post proof of completion of and compliance with the educational program requirements prescribed by this section in a conspicuous place at the mobile home park.

Statutes shall be liberally construed to affect their objects and to promote justice. In interpreting a statute, “[w]e first consider the language of the statute and, if it is unclear, turn to other factors, including ‘the statute’s context, subject matter, historical background, effects, consequences, spirit, and purpose.” Statutes should be interpreted to provide a fair and sensible result. “In applying a statute its words are to be given their ordinary meaning unless the legislature has offered its own definition of the words or it appears from the context that a special meaning was intended.”

The Tribunal is required to apply equitable principles when rendering decisions. The application of equity entails offering a remedy to avoid an unconscionable or unjust result.

The crux of the issue in this matter is whether Petitioner has standing to bring the current action against Respondent, and if so, whether Petitioner has established Respondent’s violation(s) of one or more of its statutory obligations to Petitioner(s) under the LTA. The Tribunal finds that although Petitioner has standing, he has not met the requisite burden of proof to establish any such violation(s) of the LTA by Respondent.

In the case at bar, the material facts in the record are clear. While Ariz. Rev. Stat. § 33-1434(A)(2-3) requires the Park to keep its premises in a clean, safe, and fit and habitable condition, there is not an indicia of evidence in the record to support a finding that Petitioner and/or Ms. Gannuscio have been injured or otherwise directly harmed as a result of the Park’s ongoing open and obvious construction project. Moreover, the record clearly reflects that Mngr. Valimont obtained the required education to fulfill his duties as the Park’s manager, and displays his credentials in his office on Park grounds, in adherence with Ariz. Rev. Stat. § 33-1437(A-B).

In reviewing the record it is clear that Petitioner’s main points of contention are the lack of notice for the Park’s plumbing project, the status and state thereof, and dissatisfaction with the Park’s response(s) to his and his mother’s complaints about such. Petitioner did not, however, provide the Tribunal with any statute, rule, regulation, or binding authority that established justiciable grounds for any of these issues under the statutes cited. Petitioner’s opinion that elderly residents could be injured, his photos depicting an objectively unsightly construction site, or even the prolonged project period, are independently and cumulatively insufficient to establish violation(s) of Ariz. Rev. Stat. §§ 33-1434(A)(2-3) and/or 33-1437(A-B).

Ultimately, Respondent was not legally required to provide Petitioner with its construction plans, the unsightly condition of the Park during construction does not equal the existence of a dangerous condition, and Respondent did reply to Petitioner(s)’ complaints.

Therefore, because Petitioner(s) have failed to sustain their burden of proof, the undersigned has no alternative than to conclude that the underlying Complaint and Petition be dismissed, as the Department has no grounds to discipline Respondent based on an alleged violation(s) of Ariz. Rev. Stat. §§ 33-1434(A)(2-3) and/or 33-1437(A-B) filed in this matter.

Recommended Order

Based on the foregoing,

IT IS ORDERED that the Director of the Department dismiss Petitioner(s)’ Complaint and Petition against Respondent.

IT IS FURTHER ORDERED that Respondent is not required to reimburse Petitioner(s)’ $50.00 filing fee.

IT IS FURTHER ORDERED that Respondent shall not be assessed a civil penalty in this matter.

IT IS FURTHER ORDERED that Respondent shall not be awarded attorney’s fees.

NOTICE

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 five days from the date of that certification.

Done this day, July 02, 2025.

Office of Administrative Hearings

/s/ Jenna Clark

Administrative Law Judge

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

Ruby Dhillon-Williams, Interim Director

Arizona Department of Housing

1110 W. Washington St., Ste. 280

Phoenix, AZ 85007

[email redacted]

[email redacted]

[email redacted]

[email redacted]

[email redacted]

Scott A. Baluha, Esq.

Zona Law Group, P.C., Counsel for Respondent

7701 E. Indian School Rd., Ste. J

Scottsdale, AZ 85251

[email redacted]

Jeffery Orth, Petitioner et al.

11811 N. 19th Ave., #23

Phoenix, AZ 85029

[email redacted]

By: OAH Staff