Breene v. Plaza Tower Ass'n, 9957

• Decision Date: 05 October 1981
• Docket Number: No. 9957,9957
• Parties: Janet Lucas BREENE and A. William Lucas, Plaintiffs and Appellees, v. PLAZA TOWER ASSOCIATION, a corporation, Defendant and Appellant. Civ.
• Court: North Dakota Supreme Court

Page 730

310 N.W.2d 730

Janet Lucas BREENE and A. William Lucas, Plaintiffs and Appellees, v. PLAZA TOWER ASSOCIATION, a corporation, Defendant and Appellant.

Civ. No. 9957.

Supreme Court of North Dakota.

Oct. 5, 1981.

Lundberg, Conmy, Nodland, Lucas & Schulz, Bismarck, for plaintiffs and appellees; argued by A. William Lucas, Bismark.

Fleck, Mather, Strutz & Mayer, Bismarck, for defendant and appellant; argued by Brian R. Bjella, Bismarck.

SAND, Justice.

This is an appeal by the defendant, Plaza Tower Association (hereinafter referred to as Association) from a summary judgment granted in favor of the plaintiffs, Janet Lucas Breene and A. William Lucas (hereinafter referred to as Breene), in which certain amendments to the by-laws of Plaza Tower were declared not legally binding upon Breene, and further, that any amendments that may be made to the declaration of restrictions of Plaza Tower would have only a prospective effect.

On 10 May 1974 Breene purchased unit 4D in the Plaza Tower condominium in the city of Bismarck, North Dakota. The association is a corporation organized under the North Dakota condominium statutes (Ch. 47-04.1, North Dakota Century Code) for the purpose of serving as managing and governing body for the condominium. When Breene purchased the interest in the condominium, there was no restriction relating to the sale or lease of the unit other than a provision giving the association the right of first refusal to purchase or lease the unit. The first-refusal option was in the association's bylaws by reference and specifically in the declaration of the condominium. At the time Breene purchased the unit, the declaration contained a provision which provided that the declaration could be amended at any regular or special meeting of the association by a vote of three-fourths of the members of the association. ¹

On May 1979 the association passed and adopted an amendment to its bylaws. The amended bylaw in substance provided that all units of the condominium were to be occupied by the unit owner and that the leasing of a unit to a non-owner was prohibited except in the following situations:

"a. An owner may enter a short term lease not to exceed four months provided the owner shall occupy the unit during the remainder of the calendar year within which the four month lease is granted.

"b. Leases which are in existence at the time this article is adopted shall not be impaired, but shall be permitted to continue during the designated lease term. Leases existing at the time of adoption of this article shall not be renewed or extended except to the extent that said renewal or extension would be in compliance with paragraph (a) above. Any month to month lease in existence at the time this article is adopted shall be terminated within three months of the adoption of this article.

"c. Hardship Clause. In the event that an owner, due to medical or health reasons or other justifiable cause constituting a hardship, shall be unable to occupy his unit for a period in excess of four months and based on said hardship desires to lease said unit, the owner shall make application to the Board of Directors which amy, by majority vote and subsequent to a review of the application, grant to the owner an exception to the general leasing policy.

"d. This article shall not affect any unit which has been leased to the same tenant(s) by an owner in excess of three years, except that upon termination of any such tenancy in effect upon the date of adoption of this article all of the provisions of this article shall apply."

The amendment to the bylaws was not recorded in the office of the register of deeds of Burleigh County, pursuant to NDCC § 47-04.1-07.

By a letter dated 7 Nov. 1980, Breene requested permission from the president of the Association (Albert Hartl) to rent the condominium unit to another party. However, the request was denied, and Breene commenced the present action to declare the Association's bylaws invalid as applied to unit 4D and to enjoin the Association from enforcing its bylaws against Breene.

Breene subsequently brought a motion for summary judgment and a hearing on that motion was held on 2 Feb. 1981. The district court granted Breene's motion in a memorandum opinion dated 3 Feb. 1981 and a judgment was entered on 9 Feb. 1981. A notice of appeal to this Court was filed on 11 Mar. 1981.

On 9 Feb. 1981, the same day the summary judgment was entered, the Association adopted two amendments to the declaration which placed restrictions on the right to lease which were similar to those contained in the bylaws adopted on 14 May 1979. The amendments to the declaration were recorded with the register of deeds of Burleigh County on 11 Feb. 1981.

The district court's memorandum opinion indicates that the subject matter before the court was tacitly heard and decided as if the amendment to the declaration had been adopted and recorded with the register of deeds' office. ² Further, the judgment provided, in pertinent part, as follows:

"3.

"That any amendment to the declaration of restrictions of Plaza Tower Association which may be made or may become effective shall have prospective effect only, and shall not have any retroactive effect, and shall have no effect on owners of condominium units at the time such an amendment to the declaration should become effective."

Plaza Tower raised the following issue for our review:

Whether or not an amendment to the Declaration of a Condominium, restricting the use of an individual unit, may be applied retroactively to persons who had purchased a unit prior to promulgation of the amendments?

Breene asserts that this question was not a part of the declaratory judgment action and not part of the motion for summary judgment and, therefore, is not properly before this Court on appeal.

The judgment contains language giving only prospective effect to any amendment to the declaration of restrictions. Furthermore, the memorandum opinion contains similar language which reflects that the matter was tacitly heard and decided. Based on this, it is apparent that the district court judge considered the pending amendment to the declaration and tailored his ruling to deal with the amendment. Because of this we believe the issue concerning the amendment to the declaration is properly before this Court.

The issue for our review must be resolved within the procedural framework of Rule 56, North Dakota Rules of Civil Procedure and our summary judgment law.

Summary judgment is a procedural device available for the prompt and expeditious disposition of a controversy without a trial if there is no dispute as to either the material facts and the inferences to be drawn from undisputed facts, or whenever only a question of law is involved. Herman v. Magnuson, 277 N.W.2d 445 (N.D. 1979); Zuraff v. Empire Fire & Marine Insurance Co., 252 N.W.2d 302 (N.D. 1977).

Although it is inherent in the condominium concept that each unit owner must give up a certain degree of freedom of choice he might otherwise enjoy in separate, privately owned property, the condominium concept must operate within the applicable statutes as well as the constitutions.

The statutory provisions relating to condominiums requires that the declaration of condominium, the restrictions, and the bylaws must be recorded in the office of the register of deeds in the county where the property is located. NDCC §§ 47-04.1-02, 47-04.1-04, 47-04.1-07. These statutory provisions contemplate a method to put prospective purchasers and owners on notice as to the restrictions and bylaws which affect their interest in the property. A prospective purchaser's decision to buy a particular unit in a condominium may be based upon the recorded restrictions which encumber that unit. In order to exercise the...