The Office of Administrative
Hearings
The Twelfth Annual Report
to
Governor Janet Napolitano
Senator Timothy S. Bee, President of the Senate
Representative James P. Weiers, Speaker of the House

Pursuant to A.R.S. § 41-1092.01(C)(5)
and
A.R.S. § 41-1092.01(C)(9)

Cliff J. Vanell, Director
November 1, 2007

19

Contents
I. Introduction and Overview................................................................................. 1
II. Continued Development of the Office...............................................................
1. Planned Community and Condominium Associations Hearings.........
2. Prototype Electronic Case File ...............................................................
3. Public Presentations................................................................................
4. Articles Published ....................................................................................
5. Professional Development ......................................................................

2
2
2
2
2
2

III. Summary of Agency Use of OAH Services...................................................... 3
1. Case Management................................................................................... 3
a. Breakdown of Cases Filed by Agency ................................................ 3
b. Number of Cases Filed Versus Cases Concluded .............................. 4
c. Timeline of Case Management ........................................................... 5
d. Incidence of Continuance.................................................................... 6
2. Evaluation ................................................................................................. 9
a. Results of Public Evaluation ................................................................. 9
b. Incidence of Rehearing and Appeal .................................................... 10
IV. Acceptance of Administrative Law Judge Decisions by Agencies.................. 11
1. Agency Action ........................................................................................ 11
2. Agency Inaction With Subsequent Certification of Finality................ 15
V. Motions for Change of Administrative Law Judge Granted Pursuant to
A.R.S. § 41-1092.07........................................................................................... 16
VI. Violations of A.R.S. § 41-1009 ......................................................................... 16
VII. Recommendations for Changes in the Administrative Procedures Act ..... 16
1. Right to settlement conferences in “contested cases” .................... 16
2. Establish uniform standards for appeal rights notice. ....................... 17
3. Establish uniform basis for rehearing.................................................. 17
4. Conform rehearing and appeal rules.................................................... 17
VIII. Recommendation for Changes or Improvements in Agency Practice
with Respect to the Administrative Procedures Act................................... 17
Recoupment of Costs for Administrative Hearings ................................. 17
Appendix ................................................................................................................ 18

I.

Introduction and Overview

The Office of Administrative Hearings (OAH) was created pursuant to Laws 1995, Chapter 251,
adding Arizona Revised Statutes § 41-1092 et seq., and commenced operation on January 1, 1996.
Administrative hearings previously provided by regulatory agencies (except those specifically exempted) were transferred to the OAH for independent proceedings. There are two OAH locations,
Phoenix and Tucson, with 31 full-time positions, including the Director, the Office Manager, 19
Administrative Law Judges, and 10 support staff. In addition to conducting hearings in Phoenix and
Tucson, the OAH videoconferences Registrar of Contractors hearings in Flagstaff, Kingman, Lake
Havasu City, Prescott, Show Low, Sierra Vista, and Yuma. Our statutory mandate is to “ensure that
the public receives fair and independent administrative hearings.”
Responsibility:
The OAH understands its responsibility to create a system that is efficient and cost effective.
The OAH statistics in FY 2007 indicate agency acceptance of Administrative Law Judge Decisions without modification was 91.03%. Agency acceptance of Findings of Fact and Conclusions of Law without modification was 94.7%. Rehearings (1.48%) and Appeals (2.65%) were
rare. Evaluations by participants continue to indicate that Administrative Law Judges and the
OAH were rated excellent or good in 96% of all responses.
Integrity:
The OAH takes its statutory mandate to provide fair, impartial and independent hearings seriously. Although part of the executive branch, together with its client agencies, the OAH maintains
a conscious detachment from political issues and the missions of those agencies. Procedures,
rulings, and case assignments are at all times kept free of outside pressures to ensure that the
parties can be assured that hearings are impartial and independent.
Commitment:
The OAH views commitment as a willingness to advance its mission, including improving the
quality of decision-writing. While the Administrative Law Judges must render decisions according to the evidence before them and using their independent judgment, the OAH now requires
that Administrative Law Judges review all decisions that have been modified or rejected by an
agency in order to encourage them to identify any possible miscitations or other areas where
quality can be improved. This commitment is in furtherance of the duty of the OAH to provide
continuing education to its Administrative Law Judges.
Efficiency:
Through careful case management, the OAH enjoys no backlog. The completion rate for cases
in FY 2007 was 97.77%.

1

II. Continued Development of the Office
1. Planned Community and Condominium Association Hearings
HB 2824 created hearings before the OAH for disputes involving planned community and
condominium associations and their members. Pursuant to A.R.S. § 41-2198.01(B), the
disputes extend to violations of condominium documents and planned community documents
or violations of the A.R.S. Title 33, Chapters 9 and 16. The funding for these cases is exclusively based on the setting of an appropriate filing fee by the Department of Fire, Building and
Life Safety (DFBLS), which intakes petitions and is responsible for reimbursing the actual costs
of hearings before the OAH. A successful petitioner is reimbursed the filing fee by the losing
respondent. A.R.S. § 41-2198.02(A). The decisions of the OAH are final and there is no right of
rehearing. A.R.S. § 41-2198.02(B). The courts retain jurisdiction over similar actions. A.R.S. §
41-2198.03(B).

2. Pioneering of All-Electronic Hearing Docket
The OAH implemented a totally paperless case file in a large water case involving multiple
interested persons and which had great statewide and interstate interest. All filings were required to be electronic and all orders were issued via posting to a webpage. Posting of filings
and orders to the webpage was notice to all parties. The webpage may be found at http://
www.azoah.com/Water.htm

3. Public Presentations
Administrative Law Judges have presented on the subject of the OAH adjudicative process in
various venues, including Phoenix College and private groups. Such public presentations
cultivate public awareness of OAH’s mission and increase understanding of the administrative
process.

4. Articles Published
In FY 2007, the OAH published three articles on its website as part of a series of informational
articles to educate the public and parties about the hearing process and how to better present
their cases. The articles are included as an Appendix and may be found at OAH’s website at
www.azoah.com/OAHArticles.htm, along with all previous articles previously published in the
OAH Newsletter.

5. Professional Development
Administrative Law Judges continue to receive professional education in the subject matter of
agencies as well as skills development.
Administrative Law Judge Marianne Bayardi was appointed to the Phoenix Municipal Court in
January 2007.

2

III. Summary of Agency Use of OAH Services
1.

Case Management

a. Breakdown of Cases Filed by Agency (FY 2007):
7,815 cases were filed with the OAH in FY 2007. The distribution among the agencies, boards,
commissions, or political subdivisions (Agencies) are as follows (in descending order by number
of cases filed):
Arizona Health Care Cost Containment System
Registrar of Contractors
Department of Weights and Measures
Department of Health Services
Department of Economic Security - CPS
Department of Environmental Quality
State Board of Nursing
Department of Fire, Building, and Life Safety
Arizona Department of Financial Institutions
Department of Real Estate
Department of Administration - Capitol Police Parking
Liquor Licenses and Control
Department of Insurance
Department of Education - Special Ed
Department of Revenue
DFBLS - Planned Community/Condominium
Department of Public Safety - Student Transportation
Arizona State Retirement System
Department of Gaming
Medical Radiologic Technology Board of Examiners
Arizona Medical Board
Peace Officers Standards and Training
Secretary of State
Department of Racing
State Land Department
State Board of Accountancy
Board of Appraisal
Structural Pest Control Commission
Office of the Attorney General
State Board for Charter Schools
Pharmacy Board
Department of Commerce
Arizona Lottery
Board of Dental Examiners
Department of Water Resources
Board of Chiropractic Examiners
Board of Nursing Care Institution Administrators Examiners
Board of Technical Registration
Department of Agriculture
Water Quality Appeals Board

3

3,653
2,285
337
331
133
127
106
97
90
84
75
69
65
61
46
35
21
16
15
15
13
13
13
10
10
9
8
8
7
7
6
5
5
5
5
4
4
4
3
3

Board of Behavioral Health Examiners
Board of Osteopathic Examiners
Department of Administration
Arizona State Board of Optometry
Citizens Clean Elections Commission
Department of Education
Department of Public Safety - Concealed Weapons Permit Unit
Physical Therapy
Radiation Regulatory Agency

2
2
2
1
1
1
1
1
1

b. Number of Cases Filed Versus Cases Concluded:
In FY 2007, the conclusion rate (defined as cases concluded divided by new cases filed)
was 97.77%.

Comparison of Cases Filed v. Cases Concluded
7850

7815

7800

Cases

7750
Cases Concluded

7700
7650

Cases Filed

7641

7600
7550

A.R.S. § 41-1092.05 calls for the setting of hearings within 60 days of a request for hearing by
an agency in a “contested case” and within 60 days of an appeal of an “appealable agency
action.” Although an argument could be made that such timelines inevitably result in unnecessary hearing settings, case management at the OAH discourages cases being “on hold” or riding
the calendar. Generally, a matter is vacated from the first hearing setting as the result of settlement and does not take up a second hearing setting. Therefore, on the whole, statutory time
limits are beneficial to the larger process of regulatory action.

4

Disposition of Conclude d Cases FY 2007
Vacated by Agency
3%
Hearings
46%
Vacated by ALJ
51%

c. Timeline of Case Management:
A.R.S. § 41-1092.05(A) and § 41-1092.08(A) and (B) contemplate a rigorous timeline to expedite
hearings and final agency actions. “Appealable agency actions” (defined as actions taken by an
agency without a prior hearing) are required to be set for hearing within 60 days of a request by a
party. “Contested cases” (defined as proposed actions for which a hearing is required) are
required to be set within 60 days of an agency request. Administrative Law Judge Decisions
must be transmitted to the agencies within 20 days of the conclusion of the hearing. The agency
heads are required to take final action within 30 days of receipt. Boards and Commissions
generally must take final action within 5 days of their next scheduled meeting.

The following diagram illustrates the average timelines:

Average Days Between Selected Events - Appealable Agency
Actions v. Contested Cases
60.00
48.29 47.87

50.00
40.00

AAA

30.00
20.00
10.00

11.49 10.36

6.21

16.94 15.23

1.17

0.00
Request for Hearing Scheduling to First
to Scheduling
Hearing Date

5

Conclusion of
Hearing to ALJ
Decision

ALJ Decision to
Agency Action

CC

d. Incidence of Continuance:
A single continuance in FY 2007 added an average of 49.54 days to the total length of a case.
Although 66.25% of all continuance requests were granted in FY 2007, the OAH has developed a
well-deserved reputation for discouraging “convenience” continuances in favor of those based on
“good cause.” This is especially important because of the decrease in the number of Administrative Law Judges due to budget constraints. The frequency of continuance, defined as the
number of continuances granted (954) divided by the total number of cases first scheduled
(7,815), was 12.20%. The ratio of first hearing settings (7,655) to continued settings on the
calendar (987) was 1 to 0.13.

The following chart illustrates the source of continuances.

Continuance upon
motion of agency
3%

Continuance upon
motion of non-agency
party
97%

6

The following list is a breakdown of FY 2007 continued settings and their sources, by agency.

AGENCY

Continued Motion by nonagency party

Continued Motion by
agency party

Arizona Department of Commerce
Arizona Department of Financial Institutions
Arizona Health Care Cost Containment System
Arizona Lottery
Arizona Medical Board
Arizona State Retirement System
Board of Appraisal
Board of Nursing Care Institution Administrators Examiners
Citizens Clean Elections Commission
Department of Administration
Department of Administration - Capitol Police Parking
Department of Economic Security - CPS
Department of Education - Special Ed
Department of Environmental Quality
Department of Fire, Building, and Life Safety
DFBLS - Planned Community/Condominium
Department of Gaming
Department of Health Services
Department of Insurance
Department of Public Safety - Concealed Weapons
Department of Public Safety - Student Transportation
Department of Racing
Department of Real Estate
Department of Revenue
Department of Water Resources
Department of Water Resources
Department of Weights and Measures
Liquor Licenses and Control
Peace Officers Standards and Training
Pharmacy Board
Registrar of Contractors
Secretary of State
State Board for Charter Schools
State Board of Nursing
Water Quality Appeals Board

4
7
212
1
5
3
2
1
2
3
1
11
16
14
18
7
3
78
14
2
6
2
7
12
1
1
2
6
3
1
488
5
2
12
1

0
1
13
0
0
0
0
0
0
0
0
1
0
2
1
0
1
3
0
0
0
2
0
0
0
0
0
1
0
0
6
0
1
2
0

TOTAL

953

34

7

The following chart reflects the number of motions to continue that were entertained in FY 2007
and the percentage granted:
Client

Continuance Continuance Total Motions
Granted
Denied

% Granted

Arizona Department of Commerce
Arizona Department of Financial Inst.
Arizona Health Care Cost Containment
Arizona Lottery
Arizona Medical Board
Arizona State Retirement System
Board of Appraisal
Board of Behavioral Health Examiners
Board of Dental Examiners
Board of Nursing Care Institution Adm. Ex
Board of Osteopathic Examiners
Citizens Clean Elections Commission
Department of Administration
Capitol Police Parking
Department of Agriculture
Department of Economic Security - CPS
Department of Education - Special Ed
Department of Environmental Quality
Arizona Department of Financial Institutions
Department of Fire, Building, and Life Safety
DFBLS - Planned Community/Condominium
Department of Gaming
Department of Health Services
Department of Insurance
Department of Public Safety-C. Weapons
Department of Public Safety - St. Trans
Department of Racing
Department of Real Estate
Department of Revenue
Department of Water Resources
Department of Weights and Measures
Liquor Licenses and Control
Peace Officers Standards and Training
Pharmacy Board
Registrar of Contractors
Secretary of State
State Board of Accountancy
State Board for Charter Schools
State Board of Nursing
State Land Department
Water Quality Appeals Board

2
12
193
1
4
2
2
1
0
1
1
3
3
2
1
12
8
24
0
25
10
5
76
12
2
7
3
7
12
1
0
7
4
1
477
5
0
4
18
3
3

0
0
69
0
1
1
0
0
1
0
0
0
0
3
1
6
2
1
8
6
11
1
23
13
0
1
0
1
3
0
1
11
0
0
313
1
3
1
3
0
1

2
12
262
1
5
3
2
1
1
1
1
3
3
5
2
18
10
25
8
31
21
6
99
25
2
8
3
8
15
1
1
18
4
1
790
6
3
5
21
3
4

100
100
74
100
80
67
100
100
0
100
100
100
100
40
50
67
80
96
0
81
48
83
77
48
100
88
100
88
80
100
0
39
100
100
60
83
0
80
86
100
75

TOTAL

954

486

1,440

66.25%

8

2. Evaluation
a. Results of Public Evaluation:
Since November 1996, the OAH has administered an evaluation procedure. The support staff provides a
copy of the evaluation before the hearing in order to encourage all participants to respond. A discussion of
the evaluation form is included in a video played before each hearing, or is otherwise addressed by the
Administrative Law Judge. The results are not disclosed to the Administrative Law Judge. Hearing participants place completed evaluations in locked boxes located near the hearing rooms.

Those responding are asked to rate the following categories, on a scale of excellent, good, satisfactory, or
poor:

1. Attentiveness of the Administrative Law Judge
2. Effectiveness in explaining the hearing process
3. Administrative Law Judge’s use of clear and neutral language
4. Impartiality
5. Effectiveness in dealing with the issues of the case
6. Sufficient space
7. Freedom from distractions
8. Questions responded to promptly and completely
9. Treated courteously
The results indicate that satisfaction is high among all groups, with those responding rating the
OAH excellent to good in 92.31% to 97.41% of responses.

All Responses FY 2007

RESPONSES

120.00%
100.00%

96.99%

97.41%

97.35%

96.22%

96.12%

92.31%

94.79%

96.37%

97.10%

80.00%
60.00%
40.00%
20.00%

2.41%
0.60%

2.13%
0.46%

1.89%
0.76%

2.65%
1.13%

2.43%
1.44%

6.49%
1.19%

4.52%
0.69%

2.94%
0.70%

2.11%
0.78%

0.00%
1

2

3

4

5
QUESTIONS

6

7

8

9

EXCELLENT/ GOOD
AVERAGE
POOR

9

An analysis of the unrepresented parties indicates that even among this most vulnerable group,
the OAH is seen to be functioning extremely well.

Unrepresented Responses FY 2007
700
600
500

Excellent

400

Good

300

Average

200

Poor

100

9
io
n

8
st
Q
ue

Q
ue

st

io
n

7
io
n

6
st
Q
ue

st

io
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Q
ue

st
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ue

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5

4
io
n

3
st

io
n
Q
ue

st
Q
ue

st
Q
ue

Q
ue

st

io
n

io
n

1

2

0

b. Incidence of Rehearing and Appeal:
Rehearings are permitted pursuant to A.R.S. § 41-1092.09 under certain conditions. In FY 2007,
the rehearing rate (defined as rehearings scheduled divided by cases heard) was 1.48%.
Appeals to Superior Court are provided for pursuant to A.R.S. § 41-1092.08(H). In FY 2007, the
judicial appeal rate (defined as judicial appeals taken divided by cases decided on the merits)
was 2.65%. As reflected in the following diagram, rehearings and judicial appeals in FY 2007
were relatively rare. Both were concentrated at the Registrar of Contractors. Registrar of
Contractors cases are primarily contests between two private litigants: homeowner versus
contractor; and contractor versus subcontractor.

10

Judicial Appeals and Rehearings FY 2007
35

31

30

27
Rehearings

25

Appeals
20

16

15

12

10
5

0 1

2
0

0 1

3 2

4
0 1

01

1

5

3
0

0

0 1

2
0

0 1

01

2
0

01

0 1

0 1

ed

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of
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at
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ch
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0

IV. Acceptance of Administrative Law Judge Decisions
by Agencies
1. Agency Action
Agency acceptance of the Administrative Law Judge Decisions is very high. 91.03% of all
decisions acted upon by the agencies were accepted without modification. Agency acceptance
was 94.7% if viewed from the vantage point of acceptance of Findings of Fact and Conclusions
of Law, the core function of the Administrative Law Judge. 52.85% of modifications made by the
agencies were in the Recommended Order (penalty portion).

11

Amended Findings/Conclusions of
Law only
3.24%

Rejected
2.10%

Amended Order only
3.63%

Accepted without Modification
91.03%

The following chart reports the number of cases in the various categories of agency response.

3,000

2,558
2,500
2,000
1,500
1,000
500

102

91

59

Am ended Order only

Am ended Findings/Conclusions of
Law only

Rejected

0
Accepted without Modification

The following chart reports the breakdown of agency response by agency. The following are
detailed: cases which became moot before agency action; cases which were subsequently
certified by the OAH due to agency inaction; and cases which were not subject to agency modification or rejection by statute. This chart further illustrates that modifications and rejections are
few relative to the decisions accepted.

12

Accept
Attorney General
Acupuncture Bd of Ex.
Board of Accountancy
Dept. of Commerce
Department of Education
Department of Admin.
AHCCCS
Arizona Retirement Bd.
Bd. of Charter Schools
Fire, Bldg. and Life Safety
Behavioral Health
Financial Institutions
Board of Appraisal
DPS - Student Trans.
Bd of Chiropractic Ex.
DOA - Capitol Police
DES - CPS
DPS - Concealed W
Dept. of Environmental Q
Dept. of Health Services
Weights/Measures
Department of Gamings
Department of Insurance
Department of Land
Liquor License/Control
Arizona Lottery
AZ. Medical Board
Medical Radiologic Bd
Nursing Care Institutions
Secretary of State
State Board of Nursing
Bd of Osteopathic Ex
Physician Assistants
Physical Therapy
Department of Racing
Dept. of Real Estate
Department of Revenue
Registrar of Contractors
Schools for Deaf/Blind
Structural Pest Control

1
1
7
1
0
1
968
5
0
57
3
4
5
6
1
55
85
0
0
174
0
6
24
1
33
3
0
4
3
8
19
1
1
1
3
28
0
1,045
0
4

Amend
Order
0
0
0
0
0
0
6
0
1
0
0
0
0
1
1
0
1
0
0
0
1
0
0
0
3
0
2
1
0
0
2
0
0
0
0
3
0
79
0
1

TOTAL

2,558

102

Amend Reject
Findings
0
0
0
0
0
0
0
0
0
0
0
0
61
2
0
2
0
0
0
0
0
0
3
0
1
0
0
0
0
0
0
0
6
0
0
0
0
1
2
0
0
0
0
0
0
0
0
0
0
0
0
0
2
0
1
0
0
0
0
0
0
0
0
0
2
0
0
0
0
0
0
0
0
0
12
1
0
0
1
0
91

6

13

Certified

Moot

Final

Total

0
0
0
0
0
0
37
0
0
0
0
1
1
0
0
0
1
0
0
2
0
0
0
0
0
0
1
0
0
1
0
0
0
0
0
1
0
13
0
1

0
0
0
1
0
0
9
0
1
5
0
1
0
3
0
0
0
1
0
2
3
0
18
0
1
0
0
1
0
2
1
0
0
0
1
0
0
12
1
0

0
0
0
0
2
0
0
0
0
21
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4
0
0
0

1
1
7
2
2
1
1,083
7
2
83
3
9
7
10
2
55
93
1
1
180
4
6
42
1
37
3
5
7
3
11
22
1
3
1
4
32
4
1,162
1
7

59

63

27

2,906

In FY 2007, Administrative Law Judges rendered decisions that were contrary in whole or
contrary in part to agencies’ original positions in 13.45% of cases. Agency acceptance of
contrary decisions was high at 85.24%.

Recommendations Contrary to Original Agency Action FY 2007
ALJ
Recommendation
Contrary in Whole
or in Part
13.45%

ALJ
Recommendation
Aff irms
86.55%

Agency Response to Contrary Recommendations FY 2007
160

139
140
120

Cases

100
80
60
40

24

16

20

31

0
Agency Accepts Contrary
Recommendation 66.19%

Agency Amends Findings Accepts
Order 7.62%

14

Agency Amends Order Accepts
Findings of Fact/Law 11.43%

Agency Rejects Contrary
Recommendation 14.76%

The following chart reports the breakdown of agency responses to contrary decisions.
Client

Accepted

Amended
Order

Amended
Findings

Rejected Certified

Total

Arizona Dept. of Commerce
Department of Administration
AHCCCS
Arizona Retirement Bd
Board of Charter Schools
Dept. of Fire, Building, and Life Safety
Dept. of Financial Institutions
Board of Appraisal
DOT - Student Trans.
Capitol Police Parking
DES-CPS
DOT - Concealed Weapons
Department of Health Services
Weights and Measures
Department of Insurance
Liquor Licenses and Control
Arizona Medical Board
Medical Radiological Bd
Secretary of State
State Board of Nursing
Physician Assistants
Department of Racing
Dept. of Real Estate
Registrar of Contractor
Structural Pest Control

1
1
42
1
0
11
0
0
1
20
8
0
5
0
0
14
0
0
1
3
1
1
9
8
0

0
0
5
0
1
0
0
0
1
0
0
0
0
1
0
2
1
1
0
1
0
0
2
0
1

0
0
17
0
0
0
1
0
0
0
3
0
2
0
0
0
1
0
0
0
0
0
0
0
0

0
0
22
0
0
0
1
1
0
0
1
0
2
0
0
0
1
0
1
0
0
0
1
0
1

0
0
3
0
0
1
1
0
0
0
0
1
1
0
3
1
0
0
1
0
0
0
0
0
0

1
1
89
1
1
12
3
1
2
20
12
1
10
1
3
17
3
1
3
4
1
1
12
8
2

TOTAL

127

16

24

31

12

210

2. Agency Inaction With Subsequent OAH Certification of Finality
Beginning August 21, 1998, the OAH was required to certify the Administrative Law Judge
Decision as the final administrative decision if the OAH had not received the agency, board or
commission’s action accepting, modifying or rejecting the recommended decision within 30 days
of transmission. Special rules apply if the board or commission meets monthly or less frequently. A.R.S. § 41-1092.08(D). In FY 2007, 73 Administrative Law Judge Decisions were
certified by the OAH as final administrative decisions.
Agency

Certified

Department of Insurance
Registrar of Contractors
Arizona Health Care Cost Containment System
Department of Fire Building and Life Safety
Department of Health Services

15

27
12
8
5
3

Department of Public Safety - Student Transportation
Department of Weights and Measures
Secretary of State
Arizona Department of Commerce
Citizens Clean Elections Commission
Department of Public Safety - Concealed Weapons Permit Unit
Department of Racing
Liquor Licenses and Control
Medical Radiologic Technology Board of Examiners
State Board for Charter Schools
State Board of Nursing
State Land Department
State Schools for the Deaf and the Blind

3
3
2
1
1
1
1
1
1
1
1
1
1

V. Motions for Change of Administrative Law
Judge Granted Pursuant to A.R.S. § 41-1092.07
A.R.S. § 41-1092.01(C)(9)(b) requires that the OAH report the number of motions for change of
Administrative Law Judge for bias, prejudice, personal interest or lack of necessary expertise which
were filed and the number granted. In FY 2006, 9 motions were filed and one motion was granted.

VI. Violations of A.R.S. § 41-1009
Pursuant to A.R.S. § 41-1092.01(C)(9)(c), the OAH reports that it has no knowledge of violations of
A.R.S. § 41-1009 by any agency.

VII. Recommendations for Changes in the
Administrative Procedures Act
The regulated community has long complained about inconsistent procedures among the
various agencies. The following recommendations point to the areas where uniformity or greater
consistency can be accomplished:
1. Right to settlement conferences in “contested cases.”
A.R.S. § 41-1092.03 provides that appellants to “appealable agency actions” be entitled to
settlement conferences with an agency representative. No such right exists for “contested cases,” which include most disciplinary proceedings. Such a conference may be
beneficial in expediting informal disposition of contested cases.

16

2. Establish uniform standards for appeal rights notice.
Currently there are no standards for how, and with what degree of specificity, appeal
rights to Superior Court should be communicated to parties once the agency has acted.
3. Establish uniform basis for rehearing.
Parties must research the specific rules of each agency, board or commission to determine the bases for rehearing since there is little uniformity. Standardizing and recapitulating possible bases in Title 41 would make the process easier, particularly for the
unrepresented.
4. Conform rehearing and appeal rules.
Currently parties have 30 days from service of an agency’s final action, which is presumed after 5 days of mailing to the party’s last known address, to request a rehearing
under A.R.S. § 41-1092.09(A)(1) and (C). However, under A.R.S. § 12-904(A), parties
have 35 days to file an appeal to Superior Court upon service, presumed after 5 days of
mailing to the party’s last known address. Conforming the time limits for requesting
rehearings and filing appeals will simplify the process by eliminating varying time limits for
parties to act on final orders and will allow agencies to frame the effective dates of their
final orders to a single date.

VIII. Recommendation for Changes or
Improvements in Agency Practice with Respect to the
Administrative Procedures Act
Recoupment of Costs for Administrative Hearings:
Billed costs to non-General Fund supported agencies, boards and commissions (ISA agencies),
pursuant to A.R.S. § 41-1092.01(E) and (K), could be recouped by them by extending the statutory authority found in isolated statutes to all such ISA agencies.
An example of statutory authority for recoupment is found in A.R.S. § 32-128(H), which permits
the Board of Technical Registration to recoup certain costs:
H. On its determination that a registrant or a home inspector has violated this
chapter or a rule adopted pursuant to this chapter, the board may assess the
registrant or the home inspector with its reasonable costs and expenses incurred
in conducting the investigation and administrative hearing. All monies collected
pursuant to this subsection shall be deposited, pursuant to sections 35-146 and
35-147, in the technical registration fund established by section 32-109 and shall
only be used by the board to defray its expenses in connection with disciplinary
investigations and hearings. Notwithstanding section 35-143.01, these monies
may be spent without legislative appropriation.
To avoid any appearance of impropriety by the ISA agencies, such recoupment might be limited
to settlements or to cases where the ISA agency prevails before the independent Administrative
Law Judge, or only as incident to disciplinary orders.

17

Appendix

Published Articles:
1. The Administrative Law Judge
2. Consolidation and Severance of Cases
3. Homeowner Petitions Against An Association

18

Page 1 of 3

The Administrative Law Judge
By Cliff J. Vanell
Vol. 40, August 2006
Director’s note: OAH is committed to fairness and making hearings accessible to all. This article is part of a series of
informational articles to educate the public and parties who appear before us about the hearing process and how to better
present their cases. The following article may be found at OAH’s website at www.azoah.com along with all previous articles
published in the OAH Newsletter.

Who are they? Prior to the creation of the Office of Administrative Hearings (OAH), administrative
hearings were conducted at the state agencies, boards and commissions by hearing officers who were
employees or contractors of the agencies whose actions were at issue. The relationship between the
agency and the hearing officer understandably made it difficult for the public to assume the impartiality
of the hearing officer. The OAH was created to address the inherent problem of perception involved in
such in-house proceedings. Transferring hearings to an independent agency for adjudication by
Administrative Law Judges (ALJs) with no relationship to the agencies has enhanced public confidence
in the fairness of the process.
In creating the OAH, the Arizona Legislature envisioned highly trained ALJs to provide full, fair,
independent, and prompt hearings and decisions.1 To ensure that goal, the Legislature mandated that the
OAH Director make appropriate appointments of judges to preside over cases, provide training, solicit
comment from parties, and set up and maintain a system to evaluate the ALJs. In addition, the
Legislature provided a method by which a party may have an ALJ removed from a case by filing a
motion with the Director when there is evidence of bias, prejudice, personal interest or lack of necessary
expertise.
Where do they come from? In light of these mandates, great weight is placed in assessing candidates
for the position on commitment to the OAH mission of fairly and impartially deciding cases. Each
candidate is assessed for his or her spirit of collegiality, ability to master a variety of specialties among a
wide range of subjects, creativity, openness to peer review, and willingness to undertake continuing
education to enhance his or her legal reasoning and writing skills.
The ALJs come from a variety of backgrounds. Brief statements of the ALJs’ professional backgrounds
are available on the OAH website. Regardless of background and experience, certain skills and values
have been identified which are at the core of who the ALJ becomes. The very fact that hearings are
called “hearings” establishes the pivotal nature of listening. The very act of listening involves the need
for patience. At hearing, the ALJ must be willing to give great latitude for personal style, choice of
words, cadence and volume in speaking, and how the parties choose to approach their cases. The ALJ
must be able to effectively explain the procedures that will be employed at hearing and be able to rule on
objections in a way that helps parties know what was objectionable and how to proceed. Because every
case is the most important for the parties, the ALJ must be willing to give each case the attention it
deserves, without distraction and with as much understanding as the ALJ can muster. ALJs must
therefore be conscious of the forces that can distract them, be they unguarded presuppositions, routine,
professional pride, annoyance with an unruly witness or party, or personal problems. Lastly, dispassion
is not to be mistaken for impartiality. The ideal ALJ is one who is impartial, not because dispassionate
or uninterested, but because he or she is equally passionate for and interested in the needs of both
parties.

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What do they want? The ALJs want to decide cases fully and fairly. Full participation by parties is
essential to that task. Parties must develop the evidentiary record. No expertise of the ALJ can substitute
for relevant testimony or evidence. Therefore, the ALJs have acted affirmatively to assist all parties in
preparing and presenting their cases. First, the OAH rules were designed by the ALJs to simplify the
administrative process. In addition, the ALJs have written dozens of articles, available online
(http://www.azoah.com/OAHArticles.htm) to assist parties in preparing for hearing and presenting
evidence. In addition, the ALJs have participated in training videos, also available online, which discuss
and demonstrate opening statements and closing arguments, and direct and cross examinations. ALJ
decisions are searchable online. Researching an ALJ’s approach in similar cases is useful in knowing
what an ALJ might need to best understand your case.
Maintaining Integrity and Quality. The ALJ presides over cases coming before the OAH. Interim
orders, the conduct of the hearing, and the resulting decision are within the ALJ’s sound discretion. In
light of the need to protect the ALJ’s independence, OAH’s primary quality control and management
strategy has been to provide continuous feedback to the ALJs.
Such feedback has taken various forms. All parties are given an evaluation form at the beginning of each
hearing and are given the opportunity to submit it for comment to the Director’s attention. Such
comments are compiled and generalized so as not to influence an ALJ’s decision. Since November
1996, evaluations are handed out to four major groups of hearing participants: represented private party;
unrepresented private party; counsel for a private party; and counsel for the agency. The results are not
disclosed to the ALJs. To make sure that all participants are encouraged to respond, the bailiff provides
a copy of the evaluation to parties before the beginning of the hearing. The essential function of the
evaluations is to determine whether OAH has provided an accessible and respectful forum for the
determination of the truth. Evaluation results indicate that satisfaction is high among all groups, as is
illustrated in the quarterly statistics reported in the OAH Newsletters, available online. An analysis of
the unrepresented parties for any sample quarter indicates that even among this most vulnerable group,
the OAH is seen to be functioning extremely well.
The ALJs are monitored for compliance with the 20 day statutory mandate for issuing decisions. In
addition, the annual evaluation of ALJs focuses on ensuring that the ALJs’ written decisions and orders
are clear and complete, displaying good knowledge of statutes and rules governing assigned hearings,
and that cases are managed effectively, including holding prehearing conferences to expedite the
proceedings when appropriate, and ruling on motions and issuing appropriate orders in a timely manner.
ALJs necessarily receive feedback by way of complaints that are fielded as well as through motions for
change of ALJ. Each ALJ is required to review final administrative decisions by the agencies which
modify facts, conclusions of law, or which reject the ALJs’ decisions to determine if errors were made
and as a means for improving writing skills.
In addition to training, which includes State Bar sponsored continuing legal education, privately
presented courses, as well as contracted presentations, the OAH provides 40 hours per year of
continuing education opportunities to each ALJ to ensure professional development.
Most importantly, the OAH is a collegial organization and the interplay among the ALJs is the greatest
source of learning. The give and take, having their thoughts challenged, seeking advice and second
opinions, having to justify positions and first takes on a subject – these are all invaluable processes to
achieve and maintain quality.
Where have they gone? One of our numbers has left us in death, and I take this time to recall ALJ Neal
Jordan. Others have gone on to take positions with the judiciary, or other positions of esteem, such as
with the Arizona State Bar. Some have left to pursue private professions. Our alumni are available

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online. Such esteemed alumni attest to the quality of the ALJ cadre.
__________________________
Footnotes
1 A.R.S. § 41-1092.01 mandates that ALJs possess necessary technical expertise. A.R.S. § 41-1092.07 requires that the ALJs
allow all parties the opportunity to respond and present evidence and argument on all relevant issues, and exercise reasonable
control over the manner and order of cross-examining witnesses and presenting evidence to make them effective for
ascertaining the truth. A.R.S. § 41-1092.05 provides that continuances are to be granted only for good cause. The ALJs must
base any findings of fact exclusively on the evidence and on matters officially noticed. A.R.S. § 41-1092.08 mandates that
written decisions contain a concise explanation of the reasons supporting the decision and that the decision, which may
become the final administrative decision upon agency inaction, be transmitted to the agencies, boards, and commissions
within 20 days.

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Consolidation and Severance of Cases
By Daniel G. Martin, Administrative Law Judge
October 2006
Director’s note: OAH is committed to fairness and making hearings accessible to all. This article is part of a series of
informational articles to educate the public and parties who appear before us about the hearing process and how to better
present their cases. The following article may be found at OAH’s website at www.azoah.com along with all previous articles
published in the OAH Newsletter.

Consolidation
Consolidation is the process by which two or more separate cases are joined for purposes of an
administrative hearing. At the Office of Administrative Hearings (“OAH”), cases may be consolidated
in one of two ways: (1) the referring agency consolidates the cases prior to transmitting them to the
OAH for hearing; or (2) one or more of the parties files a motion to consolidate after the cases have been
transferred and set for hearing.
Motions to consolidate are governed by Arizona Administrative Code ("A.A.C.") Rule R2-19-109.
According to this rule, cases are eligible for consolidation if (1) the cases involve substantially similar
factual or legal issues, or (2) all parties are the same. See A.A.C. Rule R2-19-109(A).
Procedure
A party who is considering a motion to consolidate must first determine whether the cases to be
consolidated have all been referred to the OAH for hearing (this may be done by looking up the cases on
the OAH's website, www.azoah.com). The OAH does not have jurisdiction over cases that have not yet
been referred for hearing, and therefore is unable to consolidate such cases with existing cases on the
OAH's docket. A motion to consolidate a case that has not yet been referred for hearing (and which
therefore is not yet subject to the OAH's jurisdiction) will be denied as having been prematurely filed.
Once it has been determined that all of the cases for which consolidation is being sought are within the
jurisdiction of the OAH, a formal motion to consolidate may be filed. By rule, that motion must be
directed to the Administrative Law Judge who is assigned to the case with the earliest pending hearing
date. See A.A.C. Rule R2-19-109(B). Again, this information may be determined by reviewing the case
information available on the OAH's website. A motion to consolidate, like any other motion filed with
the OAH, must be copied to every other party involved in the matters for which consolidation is being
requested. Also, although not required, the moving party should consider providing a courtesy copy of
the motion to the Administrative Law Judge(s) assigned to the other case(s) for which consolidation is
being sought.
The principle that will most directly guide the Administrative Law Judge's decision as to whether to
grant a motion to consolidate is whether consolidation will increase administrative efficiency. Thus,
every motion to consolidate should explain, in detail, how such efficiency will be attained. As a general
rule, a motion that simply recites the criteria listed in A.A.C. Rule R2-19-109(A) will not be considered
persuasive. The Administrative Law Judge must be able to understand why convening a single hearing
will make for a more orderly presentation of evidence, and how consolidation will facilitate the
resolution of the issues presented.

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If the motion to consolidate is granted, the hearing typically will be scheduled on the latest pending
hearing date, and will be assigned to the Administrative Law Judge who is scheduled to hear the case on
that date. Thus, the practical effect of consolidation in most instances is that the earlier case(s) will be
continued to the later hearing date. A party may, however, request that the hearing be accelerated to an
earlier hearing date, or that the consolidated cases be set for hearing on a different date. Such requests
should be included in the party's motion.
Practical Considerations
As a general rule, a motion to consolidate is most likely to be granted when the basis for the motion is
the fact that all of the parties are the same (though a showing still must be made that the consolidation
will promote administrative efficiency). A more difficult issue arises when the circumstances involve a
single complainant and multiple respondents (as can be the case, for example, in matters arising out of
the Registrar of Contractors where a complaint has been filed against both a general contractor and one
or more subcontractors). In this situation, a showing for consolidation may be made when the complaint
arises out of the same basic fact pattern; however, the moving party still must demonstrate that
efficiency will best be served by proceeding against all of the respondents at the same time. A third
scenario involves the case of multiple complainants and a single respondent. Similar to the situation
involving the single complainant and multiple respondents, one of the key inquiries will be whether the
complaints arise from the same or a similar set of facts. Consolidation is less likely to be granted if each
of the complainants is raising a separate set of issues. The final scenario involves the case of multiple
complainants and multiple respondents. This situation is the least likely to give rise to consolidation, as
the degree of complexity generated by the involvement of multiple parties on both sides will generally
be considered a barrier, rather than an aid, to efficient case resolution through a single hearing.
In each of the above situations, the final determination as to whether consolidation will be permitted lies
squarely within the discretion of the Administrative Law Judge to whom the motion is directed. Parties
considering consolidation can advance their cause by filing their motions as early as possible in the
process, and by concisely identifying each of the reasons why consolidation should be granted.
Severance
Severance, as the name implies, is the process by which two or more consolidated cases are severed
from each other so that each may be heard individually. In accordance with A.A.C. Rule R2-19-109(D),
cases may be severed upon motion by one or more of the parties, or in the discretion of the assigned
Administrative Law Judge.
Severance is less common than consolidation, but may be ordered when the assigned Administrative
Law Judge concludes that the cases involved contain sufficiently different issues of fact and/or law that
continued consolidation will not promote efficient case resolution. Orders for severance are most
common in cases that are consolidated prior to their referral to the OAH for hearing. However, on
occasion an Administrative Law Judge may determine that a case previously consolidated upon motion
has simply proved too unwieldy, or that consolidation did not give rise to the efficiencies believed to be
present at the time of consolidation, and order severance.
In contrast to a motion for consolidation, a motion for severance should explain to the Administrative
Law Judge why continued consolidation will not promote administrative efficiency. Some examples of
grounds on which a motion to sever may be granted include (1) the existence of different parties with
divergent interests, (2) the absence of a common set of operative facts, (3) distinct issues of law, and/or
(4) different or contradictory requests for relief.

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If an order for severance is issued, the newly separated cases will be re-set for hearing. If a party filing a
motion for severance has any preference for particular hearing dates (including retaining the original
hearing date), such preference should be expressed in the motion.
Conclusion
As can be seen from the foregoing discussion, the determination as to whether to grant a motion to
consolidate or sever depends heavily on the particular facts and circumstances of the cases involved.
Thus, parties should exercise particular care in explaining why consolidation or severance should be
granted, and provide specific analysis as to how the granting of their motion will contribute to
administrative efficiency.
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Page 1 of 4

Revised 06/27/07 to add footnotes not previously reflected on the htm version of this article.

Homeowner Petitions Against An Association 1
By Cliff J. Vanell, Director
Director’s note: OAH is committed to fairness and making hearings accessible to all. This article is part of a series of
informational articles to educate the public and parties who appear before us about the hearing process and how to better
present their cases. The following article may be found at OAH’s website at www.azoah.com along with all previous articles
published in the OAH Newsletter.

Overview
In Laws 2006, Chapter 324, the Arizona Legislature created a revolutionary system of adjudication of
disputes between homeowners 2 and their associations as an alternative to filing an action in court.
Filing a petition with the Department of Fire, Building and Life Safety, the means by which such a
matter is brought before the Office of Administrative Hearings (OAH), is a less costly and faster method
of resolving disputes. Harnessing the advantages of streamlined procedures and a fast track which has
proven itself since January 1996, disputes are resolved at OAH in generally less than 90 days. The OAH
Administrative Law Judges have a great deal of leeway to consider evidence and to craft pre-hearing
orders so as to maximize efficiency. However, there are costs to the process, some apparent, others less
so.
There is an immediate cost to the homeowner in the nature of a filing fee.3 Defending even a nonmeritorious petition can be costly for an association, and the expense is ultimately borne by the
association members, including the homeowner, through assessments. A homeowner will be reimbursed
the filing fee by the association only if the homeowner is determined by the Administrative Law Judge
to be the prevailing party. The homeowner therefore has an immediate interest in filing a valid petition,
and one that can be proven. An unsubstantiated or invalid petition will result in the loss of the filing fee.
Likewise, the association has an economic interest in evaluating the homeowner's petition to determine
to what extent the alleged facts are really in dispute and whether the allegations have merit. What
follows is offered in the way of a checklist to guide both homeowner and association.

Homeowner
1. Do I have a valid petition?
z

Am I alleging a violation of a statute in Title 33 or the community documents?
Only disputes that allege a violation of the provisions of A.R.S. Title 33 Chapter 9
(condominium associations) or Chapter 16 (planned community associations), or the
provisions of the condominium or planned community documents can be heard by the
OAH. For example, if the association is required to provide 24 hours notice of a Board
meeting according to the association governing documents, and held a meeting without
doing so, one would have a valid petition. Allegations of criminal acts, libel, slander, etc.
which constitute violations of the criminal statutes of Title 13, or which constitute civil torts

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are not within the jurisdiction of the OAH.
z

Is the violation by the association?
The petition must deal with a dispute between a homeowner and a condominium or planned
community association. Disputes between two homeowners or with an individual board
member of an association cannot be heard by the OAH.

z

Is it your dispute?
A homeowner has no standing to pursue a dispute on behalf of another homeowner. For
example, if another homeowner is aggrieved by the denial of an architectural modification
in violation of the association guidelines, only the aggrieved homeowner may bring a
petition against the association.

z

Is it a current dispute?
There must be a current dispute. For example, if board meetings were held without notice
but the practice has now been conformed to notice requirements and prior actions taken in
violation of the notice requirements subsequently ratified, there may have been a technical
violation of the association's governing documents, but it is no longer in dispute. Another
way to look at it is to ask yourself whether a remedy can be fashioned by the Administrative
Law Judge? If there is no remedy, or the situation has already been remedied, it is probably
not a current dispute.

z

Has the dispute been previously adjudicated?
If the petition item has been decided by a court or previously has been addressed in a hearing
before the OAH, it cannot be revisited. OAH has no authority for contempt proceedings or
enforcement of prior decisions. However, failure by a party to comply with a decision issued by
the OAH may result in the other party seeking enforcement of the Administrative Law Judge's
decision through a contempt of court proceeding in Superior Court

2. Can I prove my petition?
The homeowner bears the burden of proving the allegations of the petition. Therefore, it is incumbent on
the homeowner to have evidence to substantiate each allegation in the petition. Alleging counts that
were not proven at hearing will be taken into account when determining whether the homeowner was the
prevailing party and is entitled to reimbursement of the filing fee. Limiting the petition to strong
allegations with good evidence maximizes the chances of having the filing fee reimbursed.
3. Are my expectations realistic about what I can accomplish?
The availability of the OAH hearing process ideally should result in compliance with statutes and
association documents without the need to file a petition. The possibility of civil penalties together with
the relative ease of bringing an action can provide motivation for an association to take the necessary
action to comply with the applicable statutes and/or governing documents.
On the other hand, the Administrative Law Judge has no power to undo the passage of time or undo hurt
feelings. The Administrative Law Judge cannot order damages or restitution. Civil penalties are reserved

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for situations where it can be demonstrated that an association has acted punitively or in bad faith.

Association
1. Could the association have done a better job of communicating with the homeowner? If not in
time to avoid a petition now, can a better job be done in the future?
Conflict is unavoidable. Credible dispute resolution systems at the association level can go a long way
toward relieving tensions and fostering mutual trust. The best way to avoid a petition is to become aware
of what the statutes and the community documents require. Associations should then either conform to
them or follow the necessary procedures to change them.
2. Can the association rectify any deficiencies before the hearing?
Mistakes can occur, but many errors or omissions can be rectified. Doing so can avoid petitions being
filed to compel such action. Correcting errors or omissions before hearing goes a long way toward
streamlining the process and avoids expense to the association in the long run. Voluntarily rectifying
errors may also avoid civil penalties as it demonstrates good faith.
3. Does the association have any valid defenses?
When a petition is filed, a response is required within 20 days. This is the time to begin examining the
association's procedures to determine if the homeowner's points are well taken. Proceeding to hearing
when there is no valid defense may factor into whether a civil penalty is appropriate.
4. Are there facts that can be agreed to?
Often the disagreement is not about the facts of the case so much as the interpretation of a statutory
requirement or a provision of the association documents. If the association is willing to stipulate to a
fact, proof of the fact then becomes unnecessary. This saves time and costs and allows the
Administrative Law Judge to concentrate on the parties' arguments.

Conclusion
The OAH process provides a speedy and cost-effective method for resolving disputes that in the past
might have taken years and tens of thousands of dollars in fees and costs. The filing fee creates
economic incentive for a homeowner to bring meritorious petitions and potential civil penalties
discourage vindictive behavior by an association. Unlike most litigation, these parties must continue to
live with each other, literally. Associations that are diligent in acting appropriately under the community
documents and law and who communicate well with homeowners can avoid unnecessary expense and
acrimony. Because the expenses associated with hearings, be it reimbursement of the filing fee or
incurring attorneys fees and costs, are ultimately passed on to the homeowners, both parties' interests are
inextricably linked. The OAH process provides fair, impartial, and prompt hearings, and, in a sense, is
like the ideal health care provider - approachable, affordable, user-friendly. But no matter how much
you may like your doctors, the best course is not to need them.
_____________
Footnotes

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1. Although an association can also file a petition against a member, this article is written from the point of view of a
homeowner bringing a petition.
2. The term “homeowner” is used as a general term to include both homeowners and condominium owners.
3. The filing fee pays for the costs of sustaining the hearings program.

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