Grace Fellowship Church, Inc. v. Harned

• Decision Date: 31 December 2013
• Docket Number: No. 2013–T–0030.,2013–T–0030.
• Citation: 5 N.E.3d 1108
• Parties: GRACE FELLOWSHIP CHURCH, INC., Plaintiff–Appellee, v. Jack HARNED, et al., Defendants–Appellants.
• Court: Ohio Court of Appeals

5 N.E.3d 1108

GRACE FELLOWSHIP CHURCH, INC., Plaintiff–Appellee,

v.Jack HARNED, et al., Defendants–Appellants.

No. 2013–T–0030.

Court of Appeals of Ohio, Eleventh District, Trumbull County.

Dec. 31, 2013.

Thomas C. Nader, Nader & Nader, Warren, OH, for plaintiff-appellee.

Frank R. Bodor, Warren, OH, for defendants-appellants.

DIANE V. GRENDELL, J.

{¶ 1} Defendants-appellants, Jack Harned, and several other owners of land in the Meadows Plat subdivision, appeal from the Judgment Entry of the Trumbull County Court of Common Pleas, entering partial summary judgment in favor of plaintiff-appellee, Grace Fellowship Church, Inc. The issues to be determined in this case are whether a “modification clause” in a subdivision's restrictive covenants gives a purchaser of property notice that future changes may restrict his use of that property, and whether a clause allowing a majority of lot owners to “modify or change” the existing covenants by adding new burdens, which may prevent a landowner from using the property for the purposes for which it was originally purchased, is permissible. For the following reasons, we affirm the judgment of the trial court.

{¶ 2} On August 7, 1989, owners of a tract of land recorded “Restrictions Covering All Lots and Parcels of Land in the Meadows Plat, Vienna Township.” These 1989 restrictive covenants included 12 paragraphs governing building and use in the Meadows Plat subdivision. The first 11 paragraphs set forth various restrictions on the use of the property, including, inter alia, the required set-back line and size of dwellings, construction restrictions, and limitations on items that may be placed or parked on the parcels.

{¶ 3} Paragraph 12 of the 1989 restrictive covenants provided the following:

{¶ 4} The covenants herein shall be construed as covenants running with the land, and shall remain in effect until January 1, 1999, and thereafter, unless and except modified or changed by a vote of 51% or more, of the lot or acreage owners of this plat, the owner or owners being entitled to one vote for each lot owned or purchased on contract.

{¶ 5} On March 24, 2011, Grace Fellowship purchased land located at Lot 13 in the Meadows Plat. Grace Fellowship also purchased 70 acres of land adjacent to the Meadows Plat. After the purchases, a Grace Fellowship employee met with various landowners in the Meadows Plat to discuss Grace Fellowship's plans to build a church on the newly purchased land and to construct a driveway or access road upon Lot 13. Grace Fellowship's plans did not violate the 1989 restrictive covenants. On December 5, 2011, a majority of the owners in the Meadows Plat signed a document attempting to amend the 1989 restrictive covenants, pursuant to paragraph 12. The amendment created additional restrictions on the usage of the property in the Meadows Plat. The 2011 amendment provided the following:

{¶ 6} 13. All lots or acreage contained in the original Meadows Plat shall be used solely for single family residential purposes. No lot or acreage contained therein shall be used for or contain a road, highway, alleyway, driveway, passageway, thoroughfare, avenue, street, route, parkway, byway, trail, lane, path, or parking lot that connects, services, or accesses any property or real estate located east of the Meadows Plat or land not contained in the original and initially created Meadows Plat filed in Volume 42 Page 52 of the Trumbull County Records of Plats.

{¶ 7} 14. No lot or block of lots in the Meadows Plat shall be subject to vacation or withdrawal from the original plat set forth in Volume 42 Page 52 of the Trumbull County Records of Plats.

{¶ 8} 15. This amendment or modification also ratifies and readopts all other restrictions contained in the original document of restrictions of Meadows Plat recorded in Volume 498 Page 64 of the Trumbull County Official Records.

{¶ 9} On April 18, 2012, Grace Fellowship filed a Complaint for Declaratory Judgment and Other Relief against the owners of the lots located in the Meadows Plat. Count One of the Complaint sought a declaration regarding the meaning of section 12 of the 1989 restrictive covenants and that the covenants had expired; Count Two requested a declaration that the 2011 amendment was “ineffective as to the owners taking title prior to its date of recording” and void; Count Three sought a declaration that the 2011 amendment was void for public policy reasons; Count Four sought a declaration that the failure to give notice prior to the amendment rendered it void; and Count Five sought damages.

{¶ 10} Two separate Answers were filed by the various defendants on June 12 and July 12, 2012.

{¶ 11} The Meadows Plat landowners filed a Motion for Summary Judgment on November 16, 2012, arguing that the 1989 covenants had not expired; the landowners could amend the covenants; the amendment applied to existing landowners; and that notice was not required to obtain the votes necessary for the amendment.

{¶ 12} Grace Fellowship filed a Partial Motion for Summary Judgment on January 23, 2013, requesting summary judgment on Counts One, Two, and Four. Grace Fellowship argued that the restrictive covenants had expired on January 1, 1999, and that the 2011 amendment violated Ohio's Marketable Title Act because it allowed an increased burden to the property upon the amendment of the restrictive covenants. It also argued that the amendment violated its religious freedom, disallowed the church to have ingress and egress across the property, and that a proper vote was not held to modify the covenants.

{¶ 13} On February 22, 2013, the trial court issued a Judgment Entry, granting partial summary judgment in favor of Grace Fellowship on Counts Two and Four, and also granting summary judgment in favor of the landowners on Counts One and Three. The court held that the 1989 restrictive covenants are still in effect, as to Count One, and that there was no evidence to support the contention under Count Three that there was a religious motivation to the landowners' actions.

{¶ 14} Regarding the 2011 amendment, however, the court held that “the Amendment to the 1989 Meadows Plat restrictions cannot be enforced either in law or in equity” and declared the amendment to be void. The court held that the original restrictions did not mandate that only residential homes be constructed, the amendments added additional burdens to Grace Fellowship without notice, and that Grace Fellowship purchased the property with reliance on the existing restrictions.

{¶ 15} The Meadows Plat landowners timely appeal and raise the following assignments of error:

{¶ 16} “[1.] The trial court committed prejudicial error and abused its discretion in declaring void the 2011 amendment to the 1989 restrictive covenants.

{¶ 17} “[2.] The trial court committed prejudicial error and abused its discretion in failing to determine that proper notice was afforded appellee in the original 1989 restrictive covenants.

{¶ 18} “[3.] The trial court erred and committed prejudicial error in determining that appellee was required to vote in order for the amendments to the plat to be valid.

{¶ 19} “[4.] The trial court erred and abused its discretion in determining that the 2011 amendment was not in accord with the Ohio Marketable Title Act.

{¶ 20} “[5.] The trial court erred and abused its discretion in determining on page 4 of its judgment entry that the case is even stronger for the appellee because the 1989 restrictive covenants only allow for changes and modifications, not amendments or additional provisions.

{¶ 21} “[6.] The trial court erred and abused its discretion in failing to consider all of the covenants in the 1989 plat to attempt to understand the original property owners['] intention that the lots be used for residences and not for streets, or roads.”

{¶ 22} Pursuant to Civil Rule 56(C), summary judgment is proper when (1) the evidence shows “that there is no genuine issue as to any material fact” to be litigated, (2) “the moving party is entitled to judgment as a matter of law,” and (3) “it appears from the evidence * * * that reasonable minds can come to but one conclusion and that conclusion is adverse to the party against whom the motion for summary judgment is made, that party being entitled to have the evidence * * * construed most strongly in the party's favor.” A trial court's decision to grant summary judgment is reviewed by an appellate court under a de novo standard of review. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241 (1996). “A de novo review requires the appellate court to conduct an independent review of the evidence before the trial court without deference to the trial court's decision.” (Citation omitted.) Peer v. Sayers, 11th Dist. Trumbull No. 2011–T–0014, 2011-Ohio-5439, 2011 WL 5028693, ¶ 27.

{¶ 23} For ease of discussion, we will consider several assignments of error jointly.

{¶ 24} In their first assignment of error, the landowners argue that the 2011 amendment was not void, since it was permitted by the 1989 restrictive covenants. In their second assignment of error, they argue that the restrictive covenants themselves gave Grace Fellowship proper notice of the landowners' ability to change the covenants through an agreement by the majority. Further, in their fourth assignment of error, the landowners argue that any amendments to the original covenants did not violate the Ohio Marketable Title Act, emphasizing that there was no unknown burden to Grace Fellowship, given that the 1989 covenants stated they could be modified.

{¶ 25} A restrictive covenant is a “private agreement, [usually] in a deed or lease, that restricts the use or occupancy of real property, [especially] by specifying lot sizes, building lines, architectural styles, and the uses to which the property may be put.” Canton v. State, 95 Ohio St.3d 149, 2002-Ohio-2005, 766 N.E.2d 963, ¶ 28, citing Black's Law Dictionary 371 (7th...