supreme court ruling on changing hoa covenants

Neighbors, however, may find themselves coping with noise, parking, and trash in excess of what they would deal with if they had a traditional, live-in neighbor. Users want to take advantage of the additional flexibility, space, and capacity that these hospitality options offer. Owners want to take advantage of the financial upside that comes from renting the property. Short-term rentals have been a lightning rod of controversy in neighborhoods across Arizona and the nation. The Court’s ruling is significant because HOA’s frequently enact amendments to their CC&Rs and thereafter enforce those amendments under a presumption of validity.Īmong the frequently enacted and contemplated CC&R amendments that are likely to receive increased scrutiny and court challenges in light of the Calabria Ranch HOA decision are those limiting or prohibiting short-term rentals. Because the ruling is retroactive in nature, HOAs also cannot enforce already existing amendments that violate the Court’s standard. Put simply, the ruling means HOAs cannot amend CC&Rs to create a new obligation without the original CC&R providing notice that owners may be subject to the new obligation. By implication, the ruling likely does not apply to CC&R amendments that ease or remove restrictions on use. The Court’s opinion makes clear that CC&R amendments that impose “affirmative obligations” that create new restrictions on use must be (1) reasonable and (2) foreseeable to be enforceable.

Calabria Ranch HOA LLC et al. calls into question whether homeowner’s associations (“HOAs”) are lawfully able to enact and enforce certain amendments to their covenants, conditions and restrictions (“CC&Rs).

The Arizona Supreme Court’s recent opinion in Kalway v.

Supreme court ruling on changing hoa covenants