Turtle Rock v. Fisher – 10/26/2017

November 21, 2017

Arizona Court of Appeals Division One holds that a homeowners’ association may not fine residents without first having promulgated a schedule of fines.

A homeowners’ association sued one of its members for violating the recorded deed restrictions.  At trial, the homeowners’ association’s attorney introduced evidence that the member had violated the deed restrictions and presented oral testimony about the fee structure, but did not introduce a written fee structure into evidence.  The superior court granted the homeowners’ association an injunction requiring the member to comply with the deed restrictions and issued a monetary judgment against the member for the fees owed under the deed restrictions.  The member appealed.

The Court of Appeals upheld the injunction because the grounds upon which the member challenged it had not been raised first in the trial court and had thus been waived.  But the Court of Appeals reversed the monetary judgment against the member.  It held that homeowners’ association fees must be “reasonable” under A.R.S. § 33-1803(B) and that a non-standardized, unwritten fee structure is per se unreasonable.  Because the homeowners’ association had not offered a written fee structure into evidence but had merely offered testimony about the fee structure, the Court of Appeals ruled that the homeowners’ association had not met its burden to prove that the fees were reasonable.

Judge Thompson delivered the unanimous opinion, in which Judges Cattani and McMurdie joined