Dempsey v. Apache Shores Property Owners Ass'n, Inc.

• Decision Date: 12 August 1987
• Docket Number: No. 14555,14555
• Citation: 737 S.W.2d 589
• Parties: Donald DEMPSEY, et al., Appellants, v. APACHE SHORES PROPERTY OWNERS ASSOCIATION, INC., Appellee.
• Court: Texas Court of Appeals

Page 589

737 S.W.2d 589

Donald DEMPSEY, et al., Appellants, v. APACHE SHORES PROPERTY OWNERS ASSOCIATION, INC., Appellee.

No. 14555.

Court of Appeals of Texas Austin.

Aug. 12, 1987.

Rehearing Denied Oct. 14, 1987.

Jay A. Thompson, Clark, Thomas, Winters & Newton, Austin, for appellants.

James O. Guleke, II, Daugherty, Kuperman, Golden & Morehead, Austin, for appellee.

Before GAMMAGE, ABOUSSIE and SMITH ^*, JJ.

GAMMAGE, Justice.

This is an appeal from a permanent injunction prohibiting Donald Dempsey and Village Homes, Inc. (referred to collectively as "Dempsey") from placing mobile homes in the Apache Shores Subdivision on any lots except those where mobile homes are expressly permitted by the restrictive covenants. The injunction order was signed following a jury trial at which the jury found that Dempsey intended to place mobile homes on lots where mobile homes are not permitted and that the restrictions were neither waived nor subject to estoppel, laches or changed conditions. We will affirm the judgment.

Apache Shores is a subdivision in northwest Travis County which consists of approximately 2,460 lots divided into seven sections. Only about 424 lots were improved at time of trial. Declarations of restrictions were duly filed between 1968 and 1972 requiring, inter alia, single family dwellings with minimum living space of 650 square feet in sections one through five and 1200 square feet in sections six and seven. All the sections, except certain specified lots in sections three and five, have restrictions against "mobile homes, house trailers, tents, shacks, and other similar structures." The Apache Shores Property Owners Association, Inc., by grant from the original developer, has the right to approve building plans and to enforce restrictive covenants.

Dempsey and his wife own all the stock in Village Homes, Inc., a retailer of "mobile, manufactured and modular homes." By three separate transactions, Dempsey individually purchased approximately 563 lots from Apache Shores, Inc., the original developer. Each of the three earnest money contracts, executed September 5, 1983, November 18, 1983, and March 10, 1984, expressly provided the lots purchased by Dempsey were to be used "for modular or mobile homes." There is no evidence that the property owners knew the earnest money contracts between Dempsey and the developer contained this provision.

In October 1983, representatives of Dempsey and Village Homes attended a meeting of the Board of Directors of Apache Shores Property Owners Association, Inc. to present a slide show concerning the types of manufactured housing which Dempsey planned to place in the subdivision. The property owners did not object at that time; however, there is evidence in the record that Dempsey's representative was provided a copy of the restrictive covenants and that he agreed at the directors meeting that Dempsey would comply with those covenants. Property owners testified they assumed Dempsey planned to place the manufactured homes only on those lots where mobile homes are expressly permitted.

In April or May of 1984, the Property Owners Association began receiving calls from property owners complaining that Dempsey was moving double-wide trailers into non-mobile home sections of the subdivision. In June 1984, the Property Owners Association refused to approve plans for the double-wide mobile homes. Dempsey insisted on placing the double-wide units on lots where mobile homes were prohibited, and the Property Owners Association filed suit to enforce the restrictive covenants on July 25, 1984.

In points of error one, two and four, Dempsey argues essentially that the trial court's judgment, based upon the jury's answers to special issues, is erroneous because "double-wide manufactured" homes are not "mobile" homes within the meaning of the restrictive covenants. He argues the term "mobile home" is ambiguous because the Texas Legislature amended its definition of "mobile home" after the covenants were recorded to distinguish "manufactured homes," "modular homes," and later "industrialized housing," from "mobile homes." Tex.Rev.Civ.Stat.Ann. art. 5221f (Supp.1987). He argues further that any ambiguity should be resolved in favor of the unrestricted use of real property, Baker v. Henderson, 153 S.W.2d 465, 470 (Tex.Comm.App.1941, opinion adopted), because advances in technology and increased regulation of the mobile home industry have rendered today's double-wides beyond the possible realm of contemplation of the covenant drafters.

Dempsey argues that mobile homes, as they existed when the covenants were drafted between 1968 and 1972, were twelve feet wide and forty to sixty feet long with metal or aluminum siding and a flat metal roof. The undercarriage, wheels and axles on these mobile homes were designed to be permanent parts of the structure and almost always stayed with the home. By contrast, he claims the homes he plans to place in the subdivision are larger, heavier, better constructed and have optional siding and roofing materials and other amenities that make the double-wide look more like a site-built house.

Dempsey argues that because of the improvements in quality and appearance of today's double-wides, the reasons for the prohibition in the restrictive covenants no longer obtain and this Court should construe the covenant language strictly so as to exclude double-wide "manufactured" or "modular" homes from its ambit. Restrictive covenants, however, are strictly construed in favor of the grantee only when the intent of the parties is not ascertainable from the language of the covenant, and an unambiguous restriction will be enforced as written. Curb v. Benson, 564 S.W.2d 432, 433 (Tex.Civ.App.1978, writ ref'd n.r.e.); Walker v. Dorris, 206 S.W.2d 620, 623-24 (Tex.Civ.App.1947, writ ref'd n.r.e.).

Our first task then is to determine if the language of the covenant is ambiguous. Ambiguity exists if the provision is susceptible to two or more meanings so that the intention of the parties cannot be determined. Memorial Hollow Architectural Control Committee v. Mapes, 610 S.W.2d 230 (Tex.Civ.App.1980, no writ). We must look to the common and ordinary meaning of the term "mobile home" as of the date the covenant was drafted to determine if a prospective purchaser would necessarily be on notice that double-wide "manufactured" or "modular" homes are prohibited. See Davis v. Huey, 620 S.W.2d 561, 567 (Tex.1981).

It is unclear whether double-wides were in common use when the covenants were drafted between 1968 and 1972, but that is not dispositive of our inquiry. A double-wide unit is simply two single-wide units bolted together with siding material applied to the exterior to cover the seam. Dempsey argues that these are no longer "mobile homes" because they have been statutorily defined as "manufactured" and "modular" homes. He contends that because of increased regulation which resulted in improved quality, these statutorily defined units ceased being simply two mobile homes joined together, but somehow have evolved into a new species of housing unit completely distinct, as a matter of law, from "mobile homes." He argues that, at the very least, the statutory definitions create an ambiguity in the term "mobile home" which should be resolved in his favor because the law favors unrestricted use of real property. Baker v. Henderson, supra.

At the time the restricted covenants were drafted, there was statutorily only the "mobile home." When the need became apparent, legislation was enacted to protect consumers and the terms "manufactured homes," "modular homes" and later "industrialized housing" were employed by the legislature as part of its regulatory scheme. "Manufactured homes" are built in accordance with federal regulatory standards, 42 U.S.C.A. § 5401, et seq (West 1983 & Supp.1987), and "modular homes", now called "industrialized housing," are built according to state standards. Tex.Rev.Civ.Stat.Ann. arts. 5221f and 5221f-1 (Supp.1987). The differences between the two are technical and minor.

As it currently reads, the Manufactured Housing Standards Act defines "mobile" and "manufactured" homes as follows:

Sec. 3.... (a) "Mobile home" means a structure that was constructed before June 15, 1976, transportable in one or more sections, which, in the traveling mode, is eight body feet or more in width or 40 body feet or more in length, or, when erected on site, is 320 or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems.

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(s) "Manufactured housing" or "manufactured home" means a HUD-code manufactured home or a mobile home and collectively means and refers to both.

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(u) "HUD-code manufactured home" means a structure, constructed on or after June 15, 1976, according to the rules of the United States Department of Housing and Urban Development, transportable in one or more sections, which, in the traveling mode, is eight body feet or more in width or 40 body feet or more in length, or, when erected on site, is 320 or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems.

Tex.Rev.Civ.Stat.Ann. art. 5221f (Supp.1987) (emphasis added). "Industrialized housing" is defined as follows:

"Industrialized housing" means a residential structure that is designed for the use and occupancy of one or more families, that is constructed in one or more modules or constructed using one or more modular components built at a location other than the permanent residential site, and that is designed to be used as a permanent residential structure when the...