Capitol Farmers Mkt., Inc. v. Delongchamp

• Decision Date: 28 August 2020
• Docket Number: 1190103
• Parties: CAPITOL FARMERS MARKET, INC. v. Cindy C. Warren DELONGCHAMP
• Court: Alabama Supreme Court

320 So.3d 574

CAPITOL FARMERS MARKET, INC.

v.Cindy C. Warren DELONGCHAMP

1190103

Supreme Court of Alabama.

August 28, 2020

Gilbert C. Steindorff IV of Reynolds, Reynolds & Little, LLC, Birmingham; and Terry P. Wilson of Wilson & Jackson, LLC, Montgomery, for appellant.

Matthew T. Ellis of Crum, Ellis & Associates, P.C., Montgomery, for appellee.

BRYAN, Justice.

Capitol Farmers Market, Inc. ("Capitol Farmers Market"), appeals from a judgment entered by the Montgomery Circuit Court ("the circuit court") in favor of Cindy C. Warren Delongchamp.

Background

John Huddleston and Judith B. Huddleston owned certain real property located in Montgomery County, certain parcels of which they conveyed to other persons. In July 1982, the Huddlestons executed and recorded in the Montgomery Probate Court ("the probate court") a "Declaration of Restrictive Covenants" ("the 1982 Declaration"). The 1982 Declaration particularly described certain of the Huddlestons' property and specifically excepted from that description those portions of the property that had been conveyed to other persons before the 1982 Declaration.

In pertinent part, the 1982 Declaration provided the following regarding the Huddlestons' property:

"1. The Subject Property shall not be subdivided into or sold in parcels of less than five (5) acres.

"2. Only one single-family dwelling of not less than 2,500 square feet heated and cooled shall be erected on each five-acre parcel, which dwelling shall be used solely for residential purposes. In addition:

"....

"B. No dwelling or accessory building or structure shall be located within 100 feet of the property line ....

"5. The Owners herein reserve unto themselves, their heirs and assigns, and in unanimous concert with the Grantees of other platted tracts, within this subdivision, their heirs or assigns, the right, by appropriate written instrument, to waive, release, amend or annul any one or more of the foregoing provisions."

In 2003, Delongchamp acquired two adjacent parcels of property ("the Delongchamp property"). The parties agree that the Delongchamp property is included within the property described by the 1982 Declaration and is, therefore, burdened by the restrictive covenants noted above. In 2015, Capitol Farmers Market acquired two parcels of property that are adjacent to one another. The parties agree that one of the parcels ("the Capitol Farmers Market property") is included within the property described by the 1982 Declaration. The Capitol Farmers Market property abuts the Delongchamp property. It is undisputed that the other parcel acquired by Capitol Farmers Market is not subject to the restrictive covenants set out in the 1982 Declaration.

Near the Delongchamp property and the Capitol Farmers Market property is certain property purchased by Southern Boulevard Corporation, which, the record indicates, is now known as Alfa Properties, Inc. ("Alfa"). It is undisputed that certain of the property owned by Alfa ("the Alfa property") is also burdened by the restrictive covenants set out in the 1982 Declaration.

In September 2017, Delongchamp filed a complaint in the circuit court that, as amended, sought a declaratory judgment and injunctive relief regarding the Capitol Farmers Market property. Delongchamp alleged that Capitol Farmers Market was planning to "subdivide the Capitol [Farmers Market p]roperty into a high density residential subdivision with proposed lots being substantially less than the required five (5) acre minimum." Delongchamp sought a judgment declaring that the Capitol Farmers Market property was encumbered by the restrictive covenants set out in the 1982 Declaration and that Capitol Farmers Market was required to abide by the restrictive covenants on the Capitol Farmers Market property. Delongchamp also sought an injunction restraining Capitol Farmers Market from "violating" the restrictive covenants set out in the 1982 Declaration "to include, but not limited to, subdividing the Capitol [Farmers Market] property into lots less than five (5) acres." Capitol Farmers Market answered Delongchamp's complaint and amended complaint and asserted a separate counterclaim; the counterclaim is not pertinent to this appeal.

The circuit court entered an order appointing a special master "to recommend a resolution of all issues." Capitol Farmers Market later moved for a summary judgment regarding the relief requested in Delongchamp's amended complaint. In January 2019, the special master conducted what he called "the final hearing." He stated: "I will take into account the motion for summary judgment and all the arguments there. But when I rule, it will be final." The parties presented arguments and evidence, including ore tenus testimony, to the special master at the hearing. In August 2019, the special master filed a report of his findings and his recommendation in the circuit court.

The circuit court thereafter entered an order, providing, in pertinent part:

"Based upon the report and recommendations of the Special Master the Court makes the following findings and enters the Orders as set forth herein:

"The relevant facts obtained through these proceedings conclude that the property in question belonging to [Delongchamp], and the property in question belonging to [Capitol Farmers Market], as well as additional property were all subject to a set of restrictions pursuant to the [1982 Declaration] and recorded on July 7, 1982, in the [probate court].

"Delongchamp purchased her property by deed recorded on June 23, 200[3], in the [probate court]. At the time the Delongchamp [property] was encumbered by the [1982] Declaration and remains so encumbered to this date.

"Capitol Farmers [Market] purchased its property by deed recorded in the [probate court] on July 2, 2015 .... Prior to the date of the recording of the Capitol Farmers [Market] deed, Judith B. Huddleston, as one of the original Declarants under the [1982] Declaration unilaterally executed a document purporting to be a revocation of the [1982] Declaration. Said document is recorded in the [probate court] (‘the Revocation’).

At the time of the Revocation, Mrs. Huddleston owned no interest in any of the properties subject to the [1982] Declaration, including but not limited to the Delongchamp [property] and the Capitol Farmers [Market property]. In fact, no property that was originally subject to the [1982] Declaration has ever been released from the encumbrance of the [1982] Declaration prior to, nor since the date of the purported Revocation. ...

"Since the time of the execution and recording of the [1982] Declaration, substantial growth has occurred in East Montgomery and in particular along Taylor Road and Vaughn Road in the vicinity of the property in question. However, there has been no change in the use of the restricted properties. ...

"The operative portions of the [1982] Declaration applicable to the Capitol Farmers [Market property], the Delongchamp [property], and [a] parcel ... belonging to [Alfa] provide, among other things, as follows: (i) ‘No dwelling or accessory building or structure shall be located within 100 feet of the property line ...’; (ii) no parcel ‘shall be subdivided into or sold in parcels of less than five (5) acres'; and (iii) any dwelling shall not be less than 2,500 square feet on the property. Section 5 of the [1982] Declaration provided that ‘the Owners herein reserve unto themselves their heirs and [a]ssigns, and in unanimous concert with the Grantees of other platted tracts with this subdivision, their heirs and assigns, the right, by appropriate written instrument, to waive, release amend or annul any one or more of the foregoing provisions.’

"Capitol Farmers [Market] proposes to develop the Capitol Farmers [Market property] into more than twenty (20) lots with most of those lots being fifty (50) feet wide and approximately one hundred (100) feet deep. The total number of lots proposed by Capitol Farmers [Market] on the restricted parcel and the adjacent unrestricted parcel is 57...."

The circuit court's order included lengthy analyses addressing the issues presented. Based on its analyses, the circuit court's order concluded, in relevant part:

"1. The [1982] Declaration and the terms and restrictions contained therein are not ambiguous, or if ambiguous, the requirements to waive, amend, release or annul such restrictions require the consent of all parties burdened and benefitted by the [1982] Declaration;

"2. The present owners and properties benefitted and burdened by the [1982] Declaration are [Delongchamp], [Capitol Farmers Market,] and [Alfa] and the Delongchamp [property], the Capitol Farmers [Market property,] and the properties belonging to [Alfa];

"3. The attempted waiver of the [1982] Declaration by [Capitol Farmers Market] and ... one of the original ‘Grantors' was insufficient to waive the application of the restrictions contained in the [1982] Declaration;

"4. [Delongchamp] purchased the Delongchamp [property] in reliance upon the benefits and burdens of the restrictions contained in the [1982] Declaration;

"5. There exists no change in condition or use of any of the properties encumbered by the [1982] Declaration which would prohibit or preclude the enforcement of the restrictions against the Capitol Farmers [Market property] or any of the other properties encumbered by the [1982] Declaration;

"6. The [1982] Declaration continues to encumber the Capitol Farmers [Market property] and the Delongchamp [property] and may be enforced by either party against the property of the other described in the [1982] Declaration ...."

Capitol Farmers Market thereafter filed a motion, asserting that the circuit court had improperly entered its order without affording Capitol Farmers Market sufficient time and a hearing to object to the special master's recommendation, as contemplated by Rule 53(e)(2), Ala. R. Civ. P. The circuit court granted Capitol Farmers Market's motion and set the matter for a hearing. Capitol Farmers Market...