Crest Builders, Inc. v. Willow Falls Imp. Ass'n

• Court: Appellate Court of Illinois
• Writing for the Court: LINDBERG
• Citation: Crest Builders, Inc. v. Willow Falls Imp. Ass'n, 393 N.E.2d 107, 74 Ill.App.3d 420 (Ill. App. 1979)
• Decision Date: 08 August 1979
• Docket Number: No. 79-120,79-120
• Parties: , 30 Ill.Dec. 452 CREST BUILDERS, INC., an Illinois Corporation, Appellee, v. WILLOW FALLS IMPROVEMENT ASSOCIATION, an Illinois Not-For-Profit Corporation, Appellant.

Page 107

393 N.E.2d 107

74 Ill.App.3d 420, 30 Ill.Dec. 452

CREST BUILDERS, INC., an Illinois Corporation, Appellee, v. WILLOW FALLS IMPROVEMENT ASSOCIATION, an Illinois Not-For-Profit Corporation, Appellant.

No. 79-120.

Appellate Court of Illinois, Second District.

Aug. 8, 1979.

Ernst, Gallagher & Hannon, James R. Hannon, Oak Brook, for appellant.

DeBruyn, Lockie, Voorn & Taylor, Ltd., John C. Voorn, Palos Heights, for appellee.

LINDBERG, Justice.

Defendant, Willow Falls Improvement Association ("Association") appeals from an order granting the request of plaintiff Crest Builders ("Crest") for a temporary injunction restraining the Association and denying the Association's request for an injunction restraining Crest.

Crest is the developer of the Willow Falls Planned Unit Development consisting of six flat apartment buildings ("units") in Westmont, Illinois. A Declaration of Covenants and Restrictions ("Declaration") serves as the governing document for the development. The governing body for the development is the defendant Association whose members are the owners of the units. The Association has a Board of Directors ("Board") which was controlled by Crest until the autumn of 1978 when pursuant to the Declaration, Crest turned over control to a board of owners.

The owner-elected Board immediately began an effort to amend the Declaration. Pursuant to notice, on December 15, 1978, the Board called a special meeting of Association members which approved amendments to the Declaration which had the effect of terminating Crest's rights to post advertising signs on the property and to maintain a model apartment for sales and rental purposes, and of prohibiting Crest from occupying any units for business or promotional purposes. These rights to advertise and promote the units which were formerly assigned to Crest were now given exclusively to the Association. Crest, however, was given a limited right of ingress and egress to complete construction of the development. ¹ On December 22, 1978, Crest filed its complaint for an injunction to prohibit the Association from recording and implementing the amendments. On January 9, 1979 the Association recorded the amendments at the County Recorder's Office. The Association filed a complaint for a declaratory judgment and an injunction against Crest's continued promotional activities in violation of the amended Declaration. After an evidentiary hearing the trial court entered an order dated March 2, 1979 granting Crest's request for a temporary injunction against implementation of the amendments and denying the Association's motion for a temporary injunction. The order excused Crest from filing a bond "for a good cause shown." It is from this March 2 order that the Association brings this interlocutory appeal.

The major issue on appeal is whether the temporary injunction was wrongfully issued. The requirements for the issuance of a preliminary injunction are well settled. For such an injunction to issue, the plaintiff must establish: (1) that he possesses a certain and clearly ascertained right which needs protection; (2) that he will suffer irreparable injury without the protection of an injunction; (3) that there is no adequate remedy at law for his injuries; and (4) that he is likely to be successful on the merits. Bromberg v. Whitler (1977), 57 Ill.App.3d 152, 155, 14 Ill.Dec. 558, 561, 372 N.E.2d 837, 840.

Here the enjoined amendments are potentially injurious to Crest. Crest would no longer be able to freely advertise and show its remaining units. The record shows that Crest has maintained a vigorous on-site sales program that would be seriously curtailed by the amendments.

The key questions are whether Crest has a protectable interest and whether it has shown a likelihood of success on the merits. Crest argues that its rights under the original Declaration are "vested." However it cites no case which holds that a developer's sales rights are vested. Our search of the case law has failed to disclose any cases similar to the present controversy despite the fact that the modification of covenants has been a frequent topic of litigation. (See Annot. 4 A.L.R.3d 570.) In the absence of cases on point, we must turn to the language of the original Declaration itself.

Article XV of the Declaration provides that after notice is given the Declaration can be amended on approval by 75% of the Board and by owners who have not less than 75% of the votes as elsewhere defined. There is no other stated limitation on amendability and there is no provision that only certain items...