Sunburst Farms v. Braden

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

SUNBURST FARMS EAST, INC., Plaintiff/Appellee,

v.

KENNETH BRADEN, et al., Defendants/Appellants,

EDMUND T. LISI, et al., Intervenors/Appellees.

No. 1 CA-CV 19-0144
FILED 4-23-2020

Appeal from the Superior Court in Maricopa County
Nos. CV0000-488397
CV2008-000489
CV2008-007832
(Consolidated)
The Honorable Hugh E. Hegyi, Judge Retired

VACATED AND REMANDED

COUNSEL

Iannitelli Marcolini PC, Phoenix
By Claudio E. Iannitelli, Jason K. Thomas
Co-Counsel for Appellants Braden

McKeddie Cooley GP, Scottsdale
By Melanie C. McKeddie, Justin R. Cooley
Co-Counsel for Appellants Braden and Counsel for Ascani

James L. Sullivan PC, Scottsdale
By James L. Sullivan
Counsel for Plaintiff/Appellee

MEMORANDUM DECISION

Judge Jennifer B. Campbell delivered the decision of the Court, in which
Presiding Judge Paul J. McMurdie and Judge Kent E. Cattani joined.

C A M P B E L L, Judge:

¶1 Several property owners appeal from a declaratory judgment
in favor of the Sunburst Farms East, Inc. homeowners’ association
(“Sunburst”). For the following reasons, we vacate the judgment and
remand for further proceedings consistent with this decision.

BACKGROUND

¶2 Sunburst Farms East is a residential community consisting of
individual lots in four sections (“Section” Nos. 2, 3, 4 and 7). By build-out
completion, each Section had its own deed restrictions, embodied in a
Declaration of Covenants, Conditions and Restrictions (“original CC&Rs”).
While the Sections’ original CC&Rs were distinct, each governing
document contained a provision whereby every property owner
“automatically became a member” of the Sunburst Farms East Mutual
Water & Agricultural Company homeowners’ association (“SFEM”)—
Sunburst’s predecessor in interest. As stated in each of the original CC&Rs,
SFEM was created to provide irrigation water and agricultural tillage
services to its members. To fund these services, the original CC&Rs
authorized SFEM to impose assessments on its members, including those
members that did not use the provided services, and to impose liens upon
delinquent members’ lots.

¶3 When the developer relinquished control of Sunburst Farms
East, a majority of the property owners from Section Nos. 3 and 4 voted to
amend their original CC&Rs to revoke all mandatory payment obligations
and SFEM’s authority to impose liens (“first amended CC&Rs”). A majority
of the property owners from Section No. 7 likewise voted to amend their
original CC&Rs to revoke those restrictions, as well as the provision
imposing automatic membership in the association (“first amended

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CC&Rs”). Each Section retained, however, a modification clause allowing
for amendment by majority vote.

¶4 Notwithstanding the approved amendments, SFEM
subsequently placed liens upon the lots of property owners from Section
Nos. 3, 4 and 7 who did not pay association dues and assessments. In an
ensuing quiet title action to remove those liens, our supreme court
determined that the property owners of Section Nos. 3, 4 and 7 had
“effectively revoked” their original CC&Rs and were therefore “legally
released from the obligation of paying assessments and charges” to the
association. See Duffy v. Sunburst Farms E. Mut. Water & Agric. Co., Inc., 124
Ariz. 413, 417 (1979).

¶5 Despite this ruling, disputes and litigation regarding the
scope and application of the Sections’ CC&Rs continued for more than 40
years. While the history of this litigation is complex, the facts relevant to
this appeal are comparatively straightforward.

¶6 In October 2007, Sunburst’s Board of Directors (“the Board”)
held a meeting at which they presented attending property owners with an
overview of proposed, uniform CC&Rs for the entire community (“the 2007
CC&Rs”). Both before and after that meeting, the Board sent election
materials to the property owners in each Section, explaining that the 2007
CC&Rs would unify the four Sections under a single governing document.

¶7 Consistent with the Board’s representations, the 2007 CC&Rs
are captioned as the amended and restated CC&Rs for “Sunburst Farms
East Two, Three, Four and Seven.” In its preamble, the 2007 CC&Rs state
that the majority of owners “in each of Sunburst Farms Two, Three, Four
and Seven desire to amend” their CC&Rs and therefore all previously
recorded CC&Rs “for Sunburst Farms East Two, Three, Four and Seven”
are “superseded in their entirety.” The enumerated amendments include,
among other things: (1) granting optional association membership; (2)
requiring monthly assessments from all property owners, irrespective of
membership; and (3) extending the association authority to impose liens on
lots owned by delinquent property owners.

¶8 After an election on the proposed amendments, Sunburst
recorded the 2007 CC&Rs, which were purportedly approved by a majority
of property owners in each Section. By their express terms, the 2007 CC&Rs
supersede any prior litigation and settlements.

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¶9 On the heels of the 2007 CC&Rs’ recording, some property
owners (“the Homeowners”)1 filed a lawsuit seeking to enforce a prior
settlement agreement. Sunburst, in turn, filed a separate lawsuit seeking a
declaratory judgment to determine that the 2007 CC&Rs are valid.
Although the superior court consolidated the matters, the issues were
bifurcated, and this court ultimately concluded that the prior settlement
agreement, which was not approved by a majority of the property owners,
constituted an invalid amendment to the Sections’ CC&Rs. Halt v. Sunburst
Farms, Inc., 1 CA-CV 12-0376, 2014 WL 173639, 5–6, ¶¶ 26–29 (App. Jan. 16,
2014) (mem. decision).

¶10 With only the question of the validity of the 2007 CC&Rs
remaining, Sunburst moved for summary judgment, contending a majority
of the property owners from each Section had approved the 2007 CC&Rs.
In response, the Homeowners argued that: (1) Sunburst had misled the
voters, (2) the ballot was legally insufficient, and (3) the Sections’ CC&Rs
could be amended only by unanimous consent. The Homeowners also
cross-moved for summary judgment based on a lack of unanimous consent.
Denying the Homeowners’ motion, the superior court found that a majority
vote could amend the Sections’ CC&Rs and unanimous consent was not
required.

¶11 Following that ruling, the Homeowners discovered that the
2007 CC&Rs were not, in fact, approved by a majority of the property
owners in Section No. 7. In light of this discovery, the parties stipulated that
the 2007 CC&Rs are invalid as to Section No. 7, and the Homeowners
refined their argument, asserting that the 2007 CC&Rs are wholly invalid
because a majority of the property owners from each Section did not
approve them. Rejecting the Homeowners’ contention, the superior court
concluded that “uniformity was a desired goal, but not a necessary one.”
Consistent with the parties’ stipulation, the court found the 2007 CC&Rs
valid only as to Section Nos. 2, 3 and 4 and granted Sunburst’s motion for
summary judgment accordingly. Over the Homeowners’ objection, the
court found that Sunburst was the only prevailing party and awarded it

1 Although several of the appellants joined this litigation separately,
to the extent they are similarly situated with respect to the issues raised on
appeal, we refer to them collectively. It is undisputed that the appellants
from Section Nos. 3 and 4 purchased their property after the original
CC&Rs for Section Nos. 3 and 4 were amended.

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$300,000 in attorney fees as part of a declaratory judgment. The
Homeowners timely appealed.

DISCUSSION

¶12 The Homeowners challenge the underlying merits of the
declaratory judgment, contending the superior court improperly entered
summary judgment in favor of Sunburst. The Homeowners argue the 2007
CC&Rs are invalid because: (1) the proposed amendments required the
unanimous consent of all property owners; (2) the ballot improperly posed
five independent actions in a single question; (3) the ballot presented an “all
or nothing” proposition, which automatically failed when rejected by the
property owners of Section No. 7; and (4) no admissible evidence
substantiates the purported election results.

¶13 In reviewing a grant of summary judgment, we view the facts
and the reasonable inferences to be drawn from those facts in the light most
favorable to the non-moving party. Normandin v. Encanto Adventures, LLC,
246 Ariz. 458, 460, ¶ 9 (2019). “We determine de novo whether any genuine
issues of material fact exist and whether the [superior] court correctly
applied the law.” Diaz v. Phoenix Lubrication Serv., Inc., 224 Ariz. 335, 338, ¶
10 (App. 2010); see also Ariz. R. Civ. P. 56(a) (“The court shall grant summary
judgment if the moving party shows that there is no genuine dispute as to
any material fact and the moving party is entitled to judgment as a matter
of law.”).

¶14 Statutory interpretation is a question of law that we review de
novo. Dreamland Villa Cmty. Club, Inc. v. Raimey, 224 Ariz. 42, 46, ¶ 17 (App.
2010). Likewise, we review de novo contract interpretation and the superior
court’s legal conclusions. Id.

I. Amendment by Majority Vote

¶15 The Homeowners contend the 2007 CC&Rs are invalid
because the amended restrictions providing for mandatory payment
obligations and the imposition of liens were not approved by unanimous
consent.

¶16 First, according to the Homeowners, some property owners
from Section Nos. 3 and 4 are not members of Sunburst, and therefore
mandatory payment obligations may not be imposed by a majority vote. As
proscribed by statute, a homeowners’ association, which operates as a non-
profit corporation, may not impose membership on property owners absent
their express or implied consent. A.R.S. § 10-3601(B). “[T]o impose

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automatic membership on owners of property located within a
neighborhood or community development, th[e] requirement must appear
in a deed restriction embodied within a recorded instrument.” Shamrock v.
Wagon Wheel Park Homeowners Ass’n, 206 Ariz. 42, 45, ¶ 14 (App. 2003).
“Such a restriction constitutes a contract between the subdivision’s
property owners as a whole and the individual lot owners.” Id. (internal
quotations omitted). “By accepting a deed subject to deed restrictions, [a
property owner] assents to such restrictions and is bound by them.”
Dreamland Villa, 224 Ariz. at 47, ¶ 19.

¶17 While the property owners from Section No. 7 eliminated the
automatic membership provision in their first amended CC&Rs, the
property owners from Section Nos. 3 and 4 failed to do so. Instead, as
relevant here, they revoked only their original CC&Rs’ restrictions for
mandatory payment obligations and the imposition of liens.

¶18 Despite the clear language of the first amended CC&Rs for
Section Nos. 3 and 4, providing for automatic membership in the
association, the Homeowners cite Duffy for the proposition that they
“escaped from forced membership in the association” through a majority
vote. 123 Ariz. at 416. Although the Duffy opinion incorrectly conflates the
first amended CC&Rs for Section No. 7 with those for Section Nos. 3 and 4,
the cited, imprecise language the Homeowners rely upon was extraneous
to the supreme court’s ultimate conclusion that the property owners from
Section Nos. 3, 4 and 7 validly revoked their respective, original CC&Rs’
mandatory payment obligations through a majority vote. Id. at 417.

¶19 To be clear, the first amended CC&Rs for Section Nos. 3 and
4 plainly and unambiguously retained automatic membership restrictions.
By purchasing property subject to those restrictions, the Homeowners
impliedly consented to Sunburst membership.2

2 Asserting the association did not impose automatic membership for
property owners from Section Nos. 3 and 4 pursuant to settlement
agreements reached in 1985 and 2004, the Homeowners contend that
Sunburst’s “course of conduct” precludes enforcement of the automatic
membership restrictions now. But as the Homeowners acknowledge, these
settlement agreements were subsequently deemed invalid amendments to
the first amended CC&Rs because they were not approved by a majority of
the property owners. In their reply brief, the Homeowners also assert that
they relied upon a recorded notice of such settlement agreements when

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¶20 Irrespective of membership, the Homeowners maintain they
did not consent to mandatory payment obligations, and therefore the 2007
CC&Rs are invalid. By statute, “[a] member may become liable” to an
association for dues, assessments and fees through either an express or
implied agreement. See A.R.S. § 10-3613(A).

¶21 When the Homeowners purchased their property, the first
amended CC&Rs for Section Nos. 3 and 4 omitted any restrictions for
mandatory assessments and dues. However, the absence of such
restrictions is not, alone, dispositive.

¶22 In Dreamland Villa, we considered this question—whether a
community’s CC&Rs may be amended by a majority vote to impose
mandatory association dues and assessments. 224 Ariz. at 49, ¶ 30. Based
on the historic (since inception) voluntary nature of the Dreamland Villa
association membership, the lack of any common areas in the Dreamland
Villa community, and the absence of any right appurtenant in lot ownership
to membership, we concluded that the CC&Rs’ express authority to amend
by majority vote did not permit “one group of lot owners” to “in effect, take
the property of another group in order to fund activities that d[id] not
universally benefit each homeowner’s property or areas owned in common
by all.” 224 Ariz. at 51, ¶ 36. Essentially, we determined that the Dreamland
Villa homebuyers had no notice they may be subjected to mandatory
payment obligations at the time of purchase, and because such restrictions
were not otherwise reasonably foreseeable, the imposition of such
restrictions was inherently unfair. Id. at 49–51, ¶¶ 28–36.

¶23 Unlike the Dreamland Villa community, the property owners
of Sunburst Farms East, at one time, shared common areas. As defined by
statute, a “common area” is “real property that is intended for the use of
owners and residents of a residential subdivision or development.” A.R.S.
§ 42-13402(B). To be classified as a common area, a property must meet five
criteria: (1) a homeowners’ association must own the property, (2) the
association must be organized and operated to provide for the maintenance
and management of the common area property, (3) all residential property
owners in the development must be required to be members of the
association or must be obligated to pay mandatory assessments to maintain

they acquired their properties. Because the Homeowners failed to raise this
claim in their opening brief, we do not address it. In re Marriage of Pownall,
197 Ariz. 577, 583, ¶ 25 n. 5 (App. 2000) (holding issues raised for the first
time in a reply brief are waived).

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and manage the common areas, (4) all members of the association must
have a right to use and enjoy the common areas, and (5) the common areas
must be deeded to the association or corporation. Id.

¶24 Before or soon after the Sections were built-out, the developer
deeded a parcel of real property containing a private well to SFEM. And,
from the community’s inception, SFEM owned Sunburst Farms East’s
irrigation infrastructure, including well-stands, pumps, and piping on and
through each lot.

¶25 As explained in the Sections’ respective original CC&Rs,
SFEM was expressly created to maintain the irrigation system for the
benefit of all property owners. That is, each property owner had a right to
use the irrigation services.

¶26 In contrast to the historic nature of the association at issue in
Dreamland Villa, here, the original CC&Rs provided for automatic
membership and mandatory payment obligations. Although Section Nos. 3
and 4 subsequently revoked the mandatory payment obligations by
majority vote, the Homeowners were on notice that: (1) association dues
had, at one time, been compulsory; and (2) the first amended CC&Rs
retained the majority vote clause that had permitted the revocation of that
restriction.

¶27 Finally, all Sunburst Farms East property owners have a right
to irrigation services. While the well and irrigation infrastructure are no
longer “common areas” under A.R.S. § 42-13402(B)(3), based on Section No.
7’s revocation of its automatic association membership restriction, the
Section No. 7 property owners may still avail themselves of irrigation
services. The Homeowners assert that many property owners from the four
Sections decline such services, noting that some properties have tennis
courts, pools, or desert landscaping such that irrigation is undesirable. But,
the particular land-use choices of individual property owners do not negate
that the association offers the services community-wide.

¶28 Considering the historic nature of the association, the benefit
the once-common areas provide the community, and the retention of the
majority vote clause in the first amended CC&Rs, we cannot say that a
majority vote reverting to mandatory payment obligations was either
unforeseeable or unfair. Therefore, the superior court did not err by finding

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adoption of the 2007 CC&Rs required only a majority vote, not unanimous
consent.3

II. Legal Sufficiency of the Ballot

¶29 The Homeowners next contend the 2007 ballot impermissibly
combined multiple proposed actions in a single question. Specifically, the
Homeowners assert the ballot failed to provide the property owners with
the opportunity to vote for or against the amendment of each Section’s
CC&Rs and Sunburst’s by-laws.

¶30 The ballot submitted to the property owners provided the
following binary choice:

Proposed Action: To vote on the revised amended and
restated Declaration of Covenants, Conditions and
Restrictions for Sunburst Farms East 2, 3, 4, 7 and Sunburst
Farms East By-Laws.

____ I VOTE TO AMEND AND RESTATE THE
DECLARATION OF COVENANTS, CONDITIONS AND
RESTRICTIONS FOR SUNBURST FARMS EAST 2, 3, 4, 7
AND SUNBURST FARMS EAST BY-LAWS.

Voting for this option means that you approve the
revisions dated 11/01/2007 to the above[-]mentioned
governing documents.

____ I VOTE NOT TO AMEND THE DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS FOR
SUNBURST FARMS EAST 2, 3, 4, 7 AND THE SUNBURST
FARMS EAST BY-LAWS.

Voting for this option means that you do not approve
the revisions to the Sunburst Farms East Inc. governing

3 The Homeowners also cite Restatement (Third) Property–
Servitudes, § 6.10(3)(b) for the proposition that a CC&Rs’ assessment
provisions may not be changed absent unanimous approval, unless the
CC&Rs otherwise expressly authorize such an amendment. As found by
our supreme court in Duffy, the Sections’ CC&Rs contain a modification
clause that expressly permits amendments to assessment provisions by
majority vote. 124 Ariz. at 415.

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documents and that you are aware that the existing
documents will remain in force.

....

Section 2 needs 41 votes to pass, Section 3 needs 41 votes to
pass, Section 4 needs 41 votes to pass and Section 7 needs 22
votes to pass.

¶31 As outlined in A.R.S. § 10-3708(B), a written ballot must: (1)
set forth each proposed action, and (2) provide an opportunity to vote for
or against each proposed action. Akin to the Arizona Constitution’s
separate amendment rule, see Ariz. Const. art. 21, § 1, compliance with this
statute ensures that voters “are allowed to express their separate opinion”
as to each proposed action. McLaughlin v. Bennett, 225 Ariz. 351, 353, ¶ 7
(2010).

¶32 We review de novo whether a measure complies with the
statutory requirements. See Save Our Vote v. Bennett, 231 Ariz. 145, 149, ¶ 12
(2013). Borrowing the analytic framework applied to constitutional separate
amendment challenges, we examine whether the provisions of a proposed
action “are sufficiently related to a common purpose or principle that the
proposal can be said to constitute a consistent and workable whole on the
general topic embraced, that, logically speaking . . . should stand or fall as
a whole.” Id. (internal quotation omitted). Under this framework, we
consider whether a proposed action’s provisions are both “topically
related” and “sufficiently interrelated so as to form a consistent and
workable” action. Id.

¶33 In this case, the 2007 ballot presented the property owners
with a single question—whether to amend the “Declaration of Covenants,
Conditions and Restrictions for Sunburst Farms East 2, 3, 4, 7 and Sunburst
Farms East By-Laws.” Although the Homeowners argue the property
owners should have had an opportunity to independently vote on the
amendments to the CC&Rs and the corresponding by-law amendments, the
amendments to both governing documents were topically related—that is,
the by-laws were amended to conform to the 2007 CC&Rs, providing that
all Sections were subject to a uniform CC&Rs. The amendments to both
documents were also sufficiently interrelated to comply with A.R.S. § 10-
3708(B). That is, the proposed amendments to the by-laws were designed
to take effect only if a majority of the voters adopted the proposed
amendments to the CC&Rs. Because the two actions shared a common

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purpose and were not intended to operate independently, they were
properly joined.

¶34 To the extent the Homeowners also contend the ballot posed
four independent actions by asking the property owners to vote on separate
amendments to each Section’s CC&Rs, such argument is equally
unavailing. The ballot proposed the adoption of a single governing
document for the Sunburst Farms East subdivision, not separate and
distinct amendments to each Section’s CC&Rs. Therefore, the superior
court did not err by finding the ballot legally sufficient.

III. Effect of the Election

¶35 Alternatively, the Homeowners argue the proposed action
outlined in the ballot expressly conditioned adoption of the 2007 CC&Rs on
the approval of a majority of the property owners from each Section.
Working from this premise, the Homeowners assert the 2007 CC&Rs never
became effective because a majority of Section No. 7’s property owners did
not vote for the amendments.

¶36 This argument is consistent with both Sunburst’s
representations to the property owners in advance of the election and its
positions before the superior court during most of the litigation. In response
to the Homeowners’ A.R.S. § 10-3708(B) claim that the ballot was legally
insufficient, Sunburst argued that the ballot provided each property owner
the opportunity to vote separately and directly on “the only issue at hand,
which was to amend the community documents as a whole, or not.”
Addressing the same concerns, Sunburst also explained that the proposed
by-law amendments sought only to conform the by-laws to the 2007 CC&Rs
by recognizing that all Sections were subject to a singular governing
document rather than distinct CC&Rs. In making this argument, Sunburst
expressly conceded that the by-laws would not have been amended if each
Section did not approve the 2007 CC&Rs. Once the Homeowners
discovered that a majority of Section No. 7’s property owners did not vote
in favor of the 2007 CC&Rs and corresponding by-law amendments,
however, Sunburst argued that the ballot presented the property owners
with the opportunity to vote for or against independent amendments to
their respective Sections’ CC&Rs.

¶37 Without deciding whether Sunburst is procedurally barred
from advancing an inconsistent position, see Bank Am. Nat. Tr. & Sav. Ass’n
v. Maricopa County, 196 Ariz. 173, 175, ¶ 7 (App. 1999) (judicial estoppel
prevents a party from asserting inconsistent positions on the same issues

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upon which it prevailed), we address the merits of this claim. To discern
the ballot issue placed before the voters, we interpret the language used,
giving words “their natural, obvious and ordinary meaning.” See Cave Creek
Unified Sch. Dist. v. Ducey, 233 Ariz. 1, 7, ¶ 21 (2013) (internal quotation
omitted). When language is clear and unambiguous, we apply its plain
meaning without resorting to other means of construction. See Calik v.
Kongable, 195 Ariz. 496, 498, ¶ 10 (1999).

¶38 As explained in its “Proposed Action” statement, the ballot
provided the property owners an opportunity “[t]o vote on the revised
amended and restated Declaration of Covenants, Conditions and
Restrictions for Sunburst Farms East 2, 3, 4, 7 and Sunburst Farms East By-
Laws.” The ballot also informed the property owners how many votes were
required from each Section to adopt the measure: “Section 2 needs 41 votes
to pass, Section 3 needs 41 votes to pass, Section 4 needs 41 votes to pass
and Section 7 needs 22 votes to pass.”

¶39 Arguably, this language is ambiguous and may reasonably be
construed as allowing property owners to either: (1) vote for or against
adopting a single, uniform CC&Rs to govern the entire Sunburst Farms East
community; or (2) independently vote for or against amending their own
Sections’ CC&Rs. However, the ballot expressly stated that voting for the
proposed action “means that [the voter] approve[d] the revisions dated
11/01/2007 to the above[-]mentioned governing documents.” By
referencing the 2007 CC&Rs and the corresponding by-law amendments,
Sunburst incorporated those documents into the ballot, and thereby
clarified that the proposed action asked the property owners to vote for or
against a single, uniform CC&Rs to govern the entire subdivision. Stated
differently, incorporation of the 2007 CC&Rs removed any ambiguity
regarding the intent of the proposed action because the document expressly
states that: (1) it governs all Sections of Sunburst Farms East, (2) a majority
of property owners from each of the Sections approved the amendments,
and (3) previously recorded CC&Rs from any of the Sections, as well as all
prior settlement agreements and judgments, are superseded in their
entirety. Moreover, the 2007 CC&Rs define the term “property” as
encompassing all the lots from each of the Sections.

¶40 Nonetheless, Sunburst argues that the plain language of the
2007 CC&Rs is not determinative because “there was no other way to draft
[the CC&Rs] prior to the vote.” This is only true, however, if the 2007
CC&Rs were intended to supplant all other CC&Rs. Had Sunburst intended
to present the property owners with the opportunity to vote for or against
mandatory payment obligations in their respective Section’s CC&Rs, it

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could have drafted four discrete amended CC&Rs and permitted the
property owners to independently vote for or against amending their
Sections’ governing document. In the event a majority of voters from each
Section approved the proposed CC&Rs, the four distinct documents could
have been merged into a single, uniform CC&Rs for the entire community.
While Sunburst argues that any reference to Section No. 7 may be removed
through the 2007 CC&Rs’ severability clause the property owners of Section
No. 7 are indispensable parties to the contract submitted to the property
owners for a vote, not merely an omittable “provision” as Sunburst
suggests.

¶41 Given the proposed action presented to the property owners,
as made clear by the referenced and incorporated 2007 CC&Rs, adoption of
the amendments was conditioned upon the approval of a majority of the
property owners from each Section. Because Section No. 7 failed to approve
the measure, it did not pass, and the superior court therefore erred by
entering summary judgment validating the 2007 CC&Rs for Section Nos. 2,
3 and 4.

CONCLUSION

¶42 We hold, as a matter of law, that the 2007 CC&Rs are invalid.
We, therefore, vacate the superior court’s entry of summary judgment in
favor of Sunburst, as well as its declaratory judgment providing an award
of attorney fees to Sunburst, and remand for further proceedings, including
entry of summary judgment in favor of the Homeowners. See Roosevelt Sav.
Bank of City of N.Y. v. State Farm Fire & Cas. Co., 27 Ariz. App. 522, 526 (1976)
(explaining an appellate court may direct entry of judgment in favor of a
party filing a cross-motion for summary judgment with identical legal
issues that can be decided as a matter of law). Both parties request awards
of attorney fees pursuant to A.R.S. § 12-341.01. In our discretion, we decline
to award fees but award costs on appeal to the Homeowners subject to their
compliance with ARCAP 21(a).

AMY M. WOOD • Clerk of the Court
FILED: AA

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