John R Krahn Living Trust/Janet Krahn Living Trust, Petitioner, v. Tonto Forest Estates Homeowners A

This summary pertains to the hearing held on May 14, 2025, before Administrative Law Judge (ALJ) Kay A. Abramsohn, concerning the Petition filed by the John R Krahn Living Trust/Janet Krahn Living Trust (Petitioner) against the Tonto Forest Estates Homeowners Association (Respondent/HOA).

Key Facts and Main Issue

The dispute centered on a single issue: whether the Respondent violated Article 5.3 of its Covenants Codes and Restrictions (CC&Rs). CC&R 5.3 mandates that after the Declarant’s rights expire, the Architectural Committee (ARC) "shall consist of three (3) regular members, each of whom shall be appointed by the Board".

The Petitioner alleged that the HOA was in violation because the ARC was operating with only two members (Steve Gauer and Mike Ackerly) rather than the required three members. The Petition was filed on February 5, 2025.

Key Arguments
- Petitioner’s Position: John R. Krahn (Petitioner) argued that the language of CC&R 5.3 using the term "shall" means the three-member requirement is a mandatory obligation that leaves no discretion. Petitioner demonstrated that the ARC had only two members until March 17, 2025. Petitioner further argued that the HOA’s corrective action (appointing a third member) only after the complaint was filed proved the underlying violation. Petitioner also sought civil penalties due to the board's alleged bad faith and punitive behavior in ignoring his application and operating out of compliance for an extended period.
- Respondent’s Position: Dwight Jolivette (HOA President) argued that operating with two members was a reasonable interpretation of CC&R 5.3 when the Board was actively recruiting the third member. He contended that the CC&Rs do not specify a time frame for filling vacancies and that no board had ever interpreted falling below three members as dissolving the committee. The HOA opposed the imposition of civil penalties.

Legal Points and Outcome

The ALJ found that the Petitioner bore the burden of proving a violation of CC&R 5.3 by a preponderance of the evidence. The Tribunal focused on the ARC composition as of the filing date of February 5, 2025.

The ALJ concluded that the Petitioner met his burden. The hearing record demonstrated that the newly elected HOA Board had not appointed a third member to the ARC to comply with CC&R 5.3 until March 17, 2025, when Alan Damon was formally appointed. The ALJ did not address the Petitioner's arguments regarding the procedural necessity of a formal board vote for appointments (as that was not the single issue in the petition).

Final Decision

The Petitioner’s single-issue petition was granted because the HOA Board operated in violation of CC&R 5.3 by not having three members appointed to the ARC until March 17, 2025.

The ALJ ordered the Respondent to reimburse Petitioner’s $500.00 filing fee. No civil penalty was awarded.

Case Details:
- Case ID: 25F-H036-REL
- Docket: 25F-H036-REL

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