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Arizona Homeowners Coalition
Significant Court Decisions
Important news for all Homeowners
In HOA’s and Condo’s
            On Tuesday of this week the Arizona Supreme court entered a unanimous decision upholding the fundamental property rights of all homeowners and once again affirmed that irrespective of the amendment requirements specified in the CC&R’s the association has no right to add new restrictions or to materially change existing restrictions on the use or occupancy of private property without the unanimous consent of all homeowners. The decision in Kalway v. Calabria Ranch HOA  See Decision Here reinforced a previous case of Dreamland Villas v Raimey that dealt with the application of mandatory assessment without unanimous consent. This new case had must broader application and is consistent with the principles of property servitude law relative to the amendment power of an association to the original recorded CC&R’s.
            While the court in their decision did not specifically mention reference of the Restatement of law property servitude their decision is based on the combination of contract law and property law. In summary the sum total of all restrictions on the use or occupancy of your home must be established in the original recorded declaration. The association has no power or authority to add a new restriction or to materially alter an existing provision of the CC&R’s without your individual permission and approval (unanimous consent). In this case one homeowner sued the association for amendments to the CC&R’s without his permission and won negating those relevant amendments for everyone.
            One specific provision negated by the court can serve to explain what “materially modified” means. In this case the original CC&R’s limited livestock to 6 per 3.3 acres, but the amendment changed that to 15 total per property. This was a material change because it totally changes the basis for assessing livestock use, if it had changed the number of 6 to 3 per 3.3 acres that would not have been a material change and would have been allowed.
            This has turned the HOA industry on its collective ear especially CAI who has argued that the amendment power of the association is limited only by the provisions of the declaration, and have refused to acknowledge the principles of the Restatement across the country relative to unanimous consent. This decision will send shockwaves across the country because it will have relevance not only in Arizona but every other state in the country on the normal amendment process specified in the declarations.
            This issue has frequently manifested itself in Arizona by associations trying to implement restrictions on short term rentals by CC&R amendments. If you have been subjected to such a restriction against your will, see an attorney immediately to evaluate how your specific amendment plays out relative to this decision. But once again it applies to any new or materially modified restriction on the use of your property, if your association implements a new parking restriction on your private property that did not previously exist this decision would apply to that amendment.
            Beyond this specific decision is the entire issue of the ability of the association to apply rules or design control limitation outside of the CC&R’s. Let me state this as clearly as possible. The association has absolutely no authority to create any rule that in any way restricts the use or occupancy of your property including design issue such as paint color or landscaping unless it is specifically authorized in the CC&R’s. Even general authorization of a separate design guideline or a review by an Architectural review committee is not sufficient to satisfy the requirement of a specific authorization within the declaration. Unless the CC&R’s authorize a specific restriction on your private property any rule created by the association limiting how wide your driveway can be or what color you can paint your house or what tile you can put on your roof is totally baseless and unenforceable. Challenge them in court and do not let the HOA enforcement police cut down your mailbox because it is too high.

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To advocate, protect, support and advance the best interests and rights of all Common Interest Community members.
Copyright © 2022 Arizona Homeowners Coalition, All rights reserved.

We are not attorneys and any advice provided in this correspondence is not provided as a legal opinion, and cannot be used as such. We offer this advice based solely on our research and experience in dealing with HOA issues, in an effort to inform and communicate the literal written statutes and case decisions available to the public.

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