Appellant Mountain Gate Property Owners Association, Inc. ("Association") recorded an amendment to the declaration in 2020 which, in part, prohibited rentals of less than thirty days ("Amendment"). The Amendment was adopted in conformance with the procedures set forth in the Arizona Planned Community Act (A.R.S. ยง33-1817): (1) that it be approved by the vote or written consent of the number of owners specified in the declaration; and (2) that it be prepared, executed, and recorded by the association within thirty days after its adoption.
Approximately three months after the Amendment was recorded, four owners (Appellants) filed an action against the Association challenging the validity of the Amendment on several grounds. After a hearing on the matter, the trial judge found in favor of the Appellants and declared the Amendment to be invalid on two of the grounds: (1) that the Amendment was not signed by owners as required by the declaration; (2) that a short-term rental restriction was not foreseeable and thus, the declaration's generic amendment provision was insufficient to create requirements that changed the obligations of owners.
The Association filed an appeal of the trial judge's decision, and its opening brief was filed on January 14, 2022. The original action was filed in the Superior Court for Navajo County, Arizona. The appeal is pending in the Arizona Court of Appeals.
Arizona Court of Appeals Opinion - November 2022
Court: Arizona Court of Appeals
Topic: Declaration amendments
Brief Author: Scott Carpenter, Esq., CCAL, Carpenter Hazelwood, LLC
Filed: May 4, 2022
CAI Amicus Review Panel: Mr. Robert Diamond, Esq., CCAL, Co-Chair of Amicus Committee, Mr. Stephen Marcus, Esq., CCAL, Co-Chair of Amicus Committee, Mr. Thomas Moriarty, Esq., CCAL (MA), Ms. Mary Howell, Esq., CCAL (CA)