OAH-023: the effect of a reneged settlement

Please see earlier posts on OAH-023 for background information.  At this point, the status of the settlement agreement as a result of the HOA’s refusal to abide by its terms remains unclear. 

It appears that the agreement, prepared and initiated by the HOA CAI member attorney, Caroline Goldschmidt, could not be complied with since its conditions would violate local ordinances. 

A threat to re-open the case,  by the HOA attorney,  to force the homeowner into complying with the HOAs’ alleged violation did not materialize, and the homeowner’s attempt to do so resulted in a statement by the ALJ that it was out of his hands and no longer an OAH petition, by joint agreement of the parties.

The OAH case cannot be reopened since the settlement agreement (stipulation) included a provision to dismiss the OAH case, which the ALJ was all too willing to do. 

The Nolo self-help publication, Everybody’s Guide to Small Claims Court,  suggests that any settlement contain a provision that it be entered as part of the judge’s order decision. In this way, any failure to comply by any party to can be brought back into the court/hearing.

So, if the HOA “gave up” and is doing nothing, the homeowner need not do anything.  The issue can be revisited if the HOA starts to fine the homeowner for violations, which would force the homeowner into re-opening the case.

OAH-023: stipulation update

Please see the OAH-023 stipulation entry of May 29th for backgrounder.

After further exchanges of letters with the HOA attorney, it appears that the HOA instigated stipulation has caused the HOA to face a no-win situation.  The agreement to raise the walls to the existing heights, splitting costs, cannot be achieved since it would violate the town’s ordinances.  The walls are over the 6-foot limit, the Petitioner has approval and did not misrepresent or mislead anyone, and holds a valid approval, but any request for a new permit would not comply with the height restrictions.  What is the HOA to do? Oh me, oh my!

Well, of course, get the homeowner to reduce his wall so the HOA can get new approvals.  NOT!  Why shouldn’t the HOA pay for any reduction to meet the town’s code since it erred when it signed the stipulation.  It got itself into this problem and now wants to get out of the agreement.  (This brings to mind those criticisms of homeowners with complaints against their HOA who are told, “You just want to get out of an agreement that you now don’t like.”  Well, it works both ways.)

Stay tuned, the HOA plans to get the ALJ to hold the Petitioner responsible for its mistake, aided and abetted by the CAI member HOA attorney Goldschmidt.

OAH-023 stipulation: HOA attorney lack of good faith

Carolyn Goldschmidt, CAI member attorney for the Association, Winterhaven at Country Club Estates in Sierra Vista, initiated a settlement stipulation with Petitioner, Donald Hard, relating to the conformity of lot walls with three neighbors.  The stipulation was signed and the OAH case was vacated – didn’t exist and can be refilled. 

Although the Petitioner had submitted municipality compliance documents to the court and HOA,

Upon completion, the raised wall was inspected and approved by the City of Sierra Vista. A copy of the City of Sierra Vista Building Permit with approvals was entered into evidence as Exhibit P-72 by the Administrative Law Judge at the hearing conducted by the Office of Administrative Hearings on April 11, 2007.

the stipulation called for,  “(5) The Association shall ensure that requirements of the ARC and the City of Sierra Vista shall be strictly adhered to in the wall revisions it undertakes.” [emphasis added]. 

In an act of good faith by the petitioner, he allowed HOA contractor to measure walls for the agreed upon adjustments, where upon he receives a letter from Goldschmidt now declaring that,

According to Bob Camps, Building Inspector for the City of Sierra Vista, the City measures wall height from the highest side, which is your side of the wall in both cases. The raised portion of the respective common walls exceeds six feet and according to Messrs. Camps and Ruiz of the City of Sierra Vista, therefore, violates the building code and would fail a building inspection.

This was not an actual inspection by the City of Sierra Vista, but “friendly” comments to the attorney by a city official, and is being used to refute the stipulation since nothing as of yet was undertaken by the HOA. No mention is made in the letter of the prior approval by the city. 

The Petitioner is being subjected to a “revisionist” interpretation of the simple stipulation by the attorney who does not admit to any  knowledge of the prior city approval.  This is an act of bad faith by the HOA with attorney Goldschmidt’s acquiescence. 

Goldschmidt warns the petitioner, not her client and without advising that he consult with an attorney, that

If this impasse cannot be resolved, I will file a motion to Judge Carroll to set aside the Stipulation, reinstate the hearing and issue his ruling. If this is the course you choose, there undoubtedly will be further litigation in Cochise County Superior Court.

 

Perhaps this is what the Petitioner should do, and file a Bar complaint against the HOA attorney, Goldschmidt.

Case No.: 07F-H067023-BFS

Complaint:                    Board failed to place member petition on annual ballot.

Source of Law:             statutes (ARS 33-1803, 33-1805); governing documents

Discussion:                   ALJ says his authority is bound by ARS 41-2198.02; that is, to force compliance with the laws and documents, and the right to charge HOA with a penalty.  ALJ advises petitioner that an adverse decision — petitioner failed to comply with CC&Rs — may result in a removal of the wall at the discretion of the HOA.

ALJ suggested the parties come to some settlement as proposed by HOA to modify walls as mutually agreed that included half-payment by the HOA.  ALJ will vacate the case subject to a signed settlement agreement, pursuant to a “stipulation of the parties.”  He would not require fees to be paid by HOA or to levy any penalty, subject to receiving a settlement agreement.

Holding:                        This matter proceeded to a hearing on April 11, 2007.  Petitioner and Respondent negotiated a settlement at the hearing, which was to be summarized in writing for signature of the parties.   A written stipulation having been filed in this Office, on April 30, 2007, which resolves the issues between the parties,

IT IS HEREBY ORDERED vacating the hearing in this matter.

           

Comments:

 

The issue relates to an agreement between homeowners over a “shared wall”, and the HOA nullification of the agreement.  This is a “neighbor” dispute over common walls with the HOA adding additional conditions and restrictions that turned into a “can of worms”.

HOA motion to dismiss was denied.

ALJ summarized the issues as follows: Did petitioners obtain approval prior to starting construction?  Was approval of all affected neighbors (3) obtained as per ACC guidelines?  HOA letter appears to have approved construction, after the fact, but asserted additional conditions.  Conditions imposed required petitioner to meet city code, yet the imposed conditions violated city code.

Petitioner complained that there were no written agreements to rely on between the neighbors or HOA “meetings”, just conversations. So they filed this complaint to clarify the issues.   Also, prior approval was given and then the HOA changed its mind.  Petitioner relied on developer’s guidelines as the HOA standard, but after transition to non-declarant control, HOA maintained that HOA rules took affect. However, HOA guidelines were “thrown out” because they violated city code, and so, petitioner maintained, the developer’s was the only guidelines in effect.

Petitioner objected to the procedural manner of the ARC “interference” when it held one-on-one meetings without all involved neighbors in attendance.  Furthermore, ARC has no enforcement authority, only the board.  ARC did not provide records for petitioner review.  Petitioners were denied attendance at any ARC meetings.Carolyn Goldschmidt for HOA.  A 5-hour hearing.

Case No.: 07F-H067026-BFS

Complaint:  

HOA appropriated part of his lot for a garage as common area

Source of Law:

statutes; declaration

 

Discussion:

On March 29, 2007, the Office of Administrative Hearings issued an Order denying Petitioner’s request for a stay.  As of this date, Petitioner has failed to either confirm or withdraw the Motion to Dismiss as required by the Order issued by this Office on March 23, 2007.

 Holding:

Therefore, IT IS ORDERED granting Petitioner’s Motion to Dismiss without prejudice and vacating. The hearing set for April 25, 2007.  IT IS FURTHER ORDERED denying Respondent’s Motion that the dismissal be with prejudice.

  Comments:

Petition vacated.  Petitioner lost his $2,000 filing fee as punishment.

Homeowner filed OAH case #026 on Feb. 17th, 2 days after the fee increase to $2,000 from $550. He went to the Tucson office where he was told that it only handles mobile home problems, and that he had to file in Phoenix.  That was on Feb 14th, the day before the fee increase.  There was no public announcement, notice or hearing concerning the increase.

 

Homeowner paid the increase because he had a cloud on his title, similar to what has resulted in OAH case 007 where the HOA appropriated homeowner sidewalks. He said that the developer went bust and did not construct garages on the homeowner lots, and now the HOA has declared these un-built slabs to be part of the common area. Leo had to pay the fee, he said, because of the high stakes involved, and he did not want to risk losing in civil court as a result of legal technicalities.

 

Petitioner filed a motion to dismiss; ALJ advised him of the loss of his $2,000 and gave him until April 3^rd motion to dismiss.