Black v. Birner

• Decision Date: 11 January 2006
• Docket Number: No. 2003-CA-002760-MR.,2003-CA-002760-MR.
• Citation: 179 S.W.3d 873
• Parties: Thomas BLACK and Evelyn Black, Appellants, v. Donald K. BIRNER, Appellee.
• Court: United States State Supreme Court — District of Kentucky

179 S.W.3d 873

Thomas BLACK and Evelyn Black, Appellants, v. Donald K. BIRNER, Appellee.

No. 2003-CA-002760-MR.

Court of Appeals of Kentucky.

March 11, 2005.

Discretionary Review Denied by Supreme Court January 11, 2006.

COPYRIGHT MATERIAL OMITTED

W.E. Rogers, III, Hopkinsville, KY, for appellant.

James R. Redd, III, Fletcher and Redd, Hopkinsville, KY, for appellee.

Before JOHNSON and McANULTY, Judges; HUDDLESTON, Senior Judge.¹

OPINION VACATING

HUDDLESTON, Senior Judge (Assigned).

Thomas and Evelyn Black appeal from a Trigg Circuit Court summary judgment and an order granting injunctive relief to Donald K. Birner. Birner sued the Blacks claiming that a building they had constructed on their property in a subdivision in Cadiz violated various restrictive covenants. The circuit court agreed with Birner, granted his motion for summary judgment and ordered that the structure be removed. On the Blacks' motion, the court suspended injunctive relief pending the outcome of this appeal.

The question presented is whether restrictive covenants, ostensibly created by a majority of lot owners in a subdivision, that purport to revive restrictions created by the original developer, are enforceable against all lot owners in the subdivision. Because we agree with the Blacks that they are not, we reverse the judgment and vacate the injunction.

The subdivision in question, Canton Heights Estates Section I, was created in 1965. In that year, the developer, Russell R. Smith, President of the Cedar Bluff Land Company, filed a series of restrictions ("the original restrictions") at the Trigg County Clerk's office. In addition to imposing various restrictions on the types of buildings that would be permitted in the subdivision, the document stated that the duration of the restrictive covenants was to be twenty years, with an opportunity after ten years had passed for a majority of landowners to alter them. The original restrictions provided, in relevant part, as follows:

The Cedar Bluff Land Company, Inc. does furthermore establish the following covenants which shall bind it and each of the purchasers of the lots in said subdivisions, which restrictive covenants shall run with the lands described in said plats and shall be binding on the undersigned and all persons claiming under them:

1. These covenants are to run with the land and shall be binding on all persons and parties claiming under them until January 1st 1975, at which time said covenants shall be automatically extended in force and effect for an additional period of ten years, unless by a majority of the owners of the lots it be agreed to change said covenants in whole or in part.

2. For violation of any of the covenants herein set forth any party hereto may prosecute appropriate proceedings under the law of the State of Kentucky, such as for damages or for abatement of a nuisance, or, in case of attempted violation, for prevention and restraint.

3. All lots in said Subdivision shall be residential, and shall be so known and designated and described, except those lots designated as commercial on the plot map.

....

5. No buildings shall be constructed with any siding material other than finished wood, brick, stone or metal alloys, except for contilever [sic] type construction, foundations will be continuous around the entire periphery of the structure, except for spaces for doors and windows if such are used.

....

8. No building shall be erected, placed or permitted to remain on a lot other than a single family dwelling, with a garage and boathouse (if such garage and/or boathouse be desired by owner), such garage and boathouse to conform, as to materials, to the requirements for the dwelling.

(Emphasis supplied.)

The parties to this appeal, and the circuit court, agree that these restrictions lapsed in 1985 under their own terms.

On August 19, 1988, a group of homeowners in the subdivision republished and restated the original restrictions, with the amendment that they were now to run in perpetuity. The document they filed ("the 1988 restrictions") provides, in relevant part, that:

WHEREAS, certain restrictions have existed for the above Subdivision since its initial development, which restrictions are of record in the Trigg County Court Clerk's Office in Misc. Book 2, page 561, and also in Misc. Book 12, page 397, and

WHEREAS, the majority of the lot owners of Canton Heights Estates Section I have agreed to republish, restate, and amend the restrictions as set out hereafter and as evidenced by the consent forms held in the Neighborhood Association files,

NOW, THEREFORE, the following are set out as Restrictions for Canton Heights Estates, Section I, which shall bind all owners and purchasers of the lots in said subdivision, which restrictions and restrictive covenants shall run with the land described in the respective plat and/or deeds of lots in this subdivision:

1. These covenants are to run with the land and shall be binding on all persons and parties claiming under them in perpetuity.

This document was signed by "Gabe A. Payne, Chairman," and attested to by "Maybelle Payne, Secretary." An attorney, C.A. Woodall III, certified that he had prepared the instrument. There is no indication in the record as to who constituted the majority of lot owners, when or how the Neighborhood Association was formed, or whether it still exists.

The Blacks purchased five adjoining lots in the Canton Heights Estates subdivision on November 6, 2001. The deed conveying the property states, in relevant part, that:

This conveyance is subject to all restrictions and easements of record which affect the subject property, and specifically [the original restrictions].

No specific reference was made in their deed to the 1988 restrictions. A little over a year later, the Blacks began building a large shed that straddles two of their lots, neither of which is improved with a single-family residence. The shed is made of metal with open doors at both ends and measures about 40 by 60 feet. Birner, a homeowner in the subdivision, filed a pro se complaint seeking injunctive relief on January 23, 2003. He claimed that the structure violated the 1988 restrictions because of its location and composition. Birner argued that the language in the Blacks' deed had put them on notice that their land was encumbered by restrictive covenants. The Blacks responded that the 1988 restrictions were void and unenforceable because they were not created by the original developer, but were arbitrarily imposed by a group of unidentified homeowners on all the lots in the subdivision. Both parties moved for summary judgment.

In granting summary judgment to Birner, and ordering the shed removed, the circuit court agreed with Birner that the Blacks' deed had provided them with sufficient notice of the 1988 restrictions. The court disagreed with the Blacks' argument regarding the validity of the 1988 restrictions, stating that it had reviewed the 1988 restrictions and found that there was nothing on the face of the instrument that appeared to be either irregular or illegal. The court also noted that the Blacks had failed to challenge the validity of the restrictions until an attempt was made to enforce them. Finally, the court stressed that it was acting in equity on behalf of the majority of the lot owners to preserve the upscale, residential character of the subdivision.

Summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, stipulations, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."² The circuit court must view the record "in a light most favorable to the party opposing the motion for summary judgment and all doubts are to be resolved in his favor."³ On appeal, we are to determine "whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law."⁴ "Interpretation or construction of restrictive covenants is a question of law. Therefore, we review this matter de novo."⁵

We turn now to the substantive issues in this appeal. The Blacks do not dispute that their shed is in contravention of the terms of the 1988 restrictions. They challenge the inherent validity of those restrictions. They contend that the 1988 restrictions are void and unenforceable because they were executed by an unspecified majority of subdivision lot owners and were recorded well after the original restrictions had expired. They maintain that the restrictions do not therefore "affect" their property under the language of their deed.

Although the parties do not cite and we have not found any Kentucky case law that directly addresses the question of whether a majority of lot owners may act together to create restrictions that are enforceable against every lot owner in a subdivision, a survey of relevant cases from other jurisdictions, as well as the secondary literature regarding the creation of valid covenants, supports the view that the 1988 restrictions were not validly created and are, therefore, unenforceable against the Blacks.

While it is true, as Birner has noted, that Kentucky law has grown more favorable toward the enforcement of restrictive covenants,⁶ this greater willingness to enforce such restrictions is premised on the assumption that the covenants to be enforced are valid.

In the classic case of Korn v. Campbell,⁷ the Court of Appeals of New York, that state's highest court, grouped restrictive covenants into three broad categories: (1) those created by a developer at the time the land in question is being subdivided; (2) those imposed by a grantor when selling a portion of his or her land; and (3) those agreed upon by owners of adjoining lands for their mutual benefit.⁸ The 1988 restrictions fail to meet...