Granite Springs Retreat Ass'n v. Manning

• Decision Date: 12 May 2006
• Docket Number: No. 05-149.,05-149.
• Parties: GRANITE SPRINGS RETREAT ASSOCIATION, INC., Petitioner, v. Art and Kay MANNING, Respondents.
• Court: Wyoming Supreme Court

Page 1005

133 P.3d 1005

2006 WY 60

GRANITE SPRINGS RETREAT ASSOCIATION, INC., Petitioner, v. Art and Kay MANNING, Respondents.

No. 05-149.

Supreme Court of Wyoming.

May 12, 2006.

Representing Petitioner: Julie Nye Tiedeken, of Tiedeken & Scoggin, P.C., Cheyenne, Wyoming.

Representing Respondents: Arthur L. and Katherine L. Manning, pro se, Cheyenne, Wyoming.

Before HILL, C.J., and GOLDEN, KITE, VOIGT, and BURKE, JJ.

BURKE, Justice.

[¶ 1] Granite Springs Retreat Association, Inc. (Granite Springs) brought a small claims action in circuit court seeking to collect homeowner's association dues in the amount of $265.44 from Mr. and Mrs. Manning. Although the case began as a simple collection action, the order ultimately entered by the circuit court reflects that it evolved into a determination regarding the validity and application of restrictive covenants pertaining to real property. This issue implicates title to real property and deprived the circuit court of subject matter jurisdiction. Pursuant to Wyo. Stat. Ann. § 1-21-102 (Lexis-Nexis Supp.2004), the case should have been certified to the district court.

ISSUE

[¶ 2] Granite Springs presents the following issue for review:

Does the Circuit Court have exclusive jurisdiction of a case in which the prayer for recovery of money does not exceed seven thousand dollars in which the Court must decide if the Defendant's real property is subject to restrictive covenants?

Mr. Manning restates the issue as:

Does the circuit court have subject matter jurisdiction to encumber title to real property?

FACTS

[¶ 3] Granite Springs is a homeowner's association which assesses yearly dues against the owners of the lots in its subdivision for maintenance of roads, common areas, and for other expenses. Mr. and Mrs. Manning own a lot within the subdivision. On September 28, 2004, Granite Springs filed a complaint in the circuit court of Laramie County seeking money damages in the amount of $265.44 for dues owed by Mr. and Mrs. Manning. The Mannings defended the action by claiming the restrictive covenants did not apply to their tract of land. After reviewing all of the evidence, the circuit court entered its Judgment. The court stated:

The facts as established during the hearing were:

1. Art and Kay Manning own a tract in a subdivision known as Granite Springs Retreat, hereinafter referred to as Granite Springs, located west of Cheyenne, Laramie County, Wyoming.

2. Granite Springs was created by two separate recorded plats known as: 1) Granite Springs Retreat, first filing, which contained tracts one through eight; and Granite Springs Retreat, Second Filing, which contained tracts nine th[r]ough sixty-three.

3. Lorenz Ranch, Inc. originally owned the land that formed Granite Springs.

4. Lorenz Ranch, Inc. conveyed the First Filing I to Deward Miller on August 16, 1976, and the plat was filed on October 1, 1976.

5. On October 4, 1976, a Declaration of Protective Covenants was recorded, for the Granite Springs subdivision. [Plaintiff's Exhibit 2]. The Protective Covenants did not describe the land restricted and there was no mention if the land restricted was limited to the land in the first filing or included land in a subsequent filing.

6. Granite Springs Retreat by Deward Miller executed these Covenants. [Plaintiff's Exhibit 2]. The Covenants provided in part that a homeowner's association could be formed if desired by the residents. This association would allow the homeowners to assess dues to the tract owners in order to provide for road maintenance, snow removal, insurance, maintenance of common areas, and other costs of maintaining the subdivision. The covenants further provided that if an association was formed all owners agreed to become members and to be subject to a dues assessment.

7. After the filing of the Covenants, Miller recorded a warranty deed for the land . . . in the second filing on March 23, 1977. [Plaintiff's Exhibit 5].

8. Lorenz Ranch, Inc., and Deward Miller were involved in a business relationship during the time of the filing of both plats and the filing of the covenants. Deward Miller filed more than one plat with the Laramie County Planning Department before he was the record owner of the land in question.

9. Members of both the families of the owners of the Lorenz Ranch, Inc., and the Deward Miller agreed that Deward Miller had an equitable interest in the land of the second filing at the time the covenants were recorded. This evidence was uncontroverted.

10. On September 15, 1977, Miller transferred all of the property within the First and Second Filings, with the exception of one parcel of land transferred three days later to Happy Jack Stable and Lounge, Inc. [Plaintiff's Exhibit 7].

11. Miller attempted to amend the Covenants by recording an Amended Declaration of Protective Covenants, for the purpose of designating tracts four and five for commercial use on February 23, 1978, after he had divested himself of all interest in the land. [Plaintiff's Exhibit 7].

12. Granite Springs homeowners established the Granite Springs Retreat Association, . . . (the Association) on September 1, 1987. [Plaintiff's Exhibit 7].

13. The Association assesses dues. The defendants are the only members of the Association who have not paid their dues to date.

14. The Defendant[s] purchased the land subject to any and all restrictions, reservations, covenants and easements of record on April 26, 1990. [Plaintiff's Exhibit 5].

15. The Defendant[s] paid the Association dues from 1990 until July 1, 2002. The Defendant[s] owe the Association dues for July 1, 2002 through June 30, 2003 in the amount of $100.00 and a 12% penalty of $12.00. They also owe dues and penalties for the period of July 1, 2003 through June 30, 2004 in the amount of $153.44. [Plaintiff's Exhibit 1].

16. Even though there were no covenants filed in the index at the Laramie County Clerk's Office on Defendant's property, the Defendant[s] were given a copy of the covenants when they purchased the property.

17. Art Manning, one of the Defendants, had been active in the homeowners Association by serving on the Board, serving as the President of the Association and attending meetings.

18. The Defendants stopped paying homeowner Association dues after a series of court actions confused the issue of whether covenants were on the land they had purchased.

19. In 1993, a Notice [of] Contract for Deed was filed, indicating that Happy Jack Stable and Lounge was selling tract five of the Second Filing to Bobby and Bridget Wallace. Two years later, the Wallaces filed their own Notice of Contract for Deed indicating that they were selling to Millheiser and Barroni. Millheiser and Barroni brought a declaratory judgment action and an action for damages, against the Wallaces and the Association, because they entered into the transaction with the understanding that there was no restriction on commercial use of tract five because of the amended covenants. The District Court entered a summary judgment in favor of Millheiser and Barroni ordering that the Amended Covenants were void because they were filed after Miller had conveyed all of his interest in the property and therefore he could not amend the covenants. Millheiser, et. al. v. Wallace, et. al., Docket No. 148-238, entered May 20, 1999. [Defendant's Exhibit A].

20. Happy Jack Stable & Lounge, Inc. sued the Association to reform the covenants and the Court relying on its ruling in Millheiser, et. al. v. Wallace, et. al., supra, granted the Association's motion for summary judgment and subsequently denied a motion for reconsideration. In the motion for reconsideration, Happy Jack Stable & Lounge, Inc., argued that the covenants did not restrict the land in the second filing. The District Court denied the motion to reconsider without comment. Happy Jack Stable & Lounge, Inc. v. Granite Springs Retreat Association, Inc., Docket 156 No. 559, entered June 19, 2001, and July 10, 2001. [Defendant's Exhibit B].

21. Another landowner in Filing 2 failed to pay his homeowner's Association dues and sued in small claims court to avoid payment. Reynolds v. Lombardi, et. al., Docket # SC-0309-0027. This court found that the covenant[s] were valid and enforceable and awarded the Association the outstanding dues. [Plaintiff's Exhibit 6]. The judgment was affirmed in District Court. Reynolds v. Lombardi, Docket No. 163-008, entered March 23, 2004. [Plaintiff's Exhibit 7]. The Courts found the following:

. . . Upon review of the record and briefs of the parties this court finds that the prior summary judgment did not void the Original Covenants, only the Amended Covenants and, therefore, Reynolds was still subject to the Association's dues.

In his reply brief, Reynolds modified his argument to state that because the Original covenants were filed prior to the Second Filing, and his tract was part of the Second Filing, the Original Covenants could not apply to his property or any of the tracts on the Second Filing. Although an interesting issue, this is a new argument that was not raised below. Matters raised for the first time on appeal will not be considered. Yates v. Yates, 81 P.3d 184, 188 (Wyo.2003) (citations omitted).

22. The only legal or factual issue is whether the covenants filed prior to the time that the person, Deward Miller, filing the covenants having a warranty deed for the Defendant's land binds the Defendants.

23. The two District Court opinions that dealt with Miller's attempt to amend the covenants after he had conveyed all interest in the land are not applicable to the issue in the case. Those two decisions were related to the amended covenants only and not to the original covenants. Happy Jack Stable & Lounge, Inc. v. Granite Springs Retreat Association, Inc., Docket 156 No. 559, entered June 19, 2001, and July 10, 2001. [Defendant's Exhibit B]; Millheiser, et. al. v. Wallace, et. al., Docket No. 148-238, entered May 20,...