Gumpel v. Copperleaf Homeowners Ass'n, Inc.

• Decision Date: 02 May 2017
• Docket Number: S-16-0167
• Citation: 393 P.3d 1279
• Parties: Glenn J. GUMPEL and Merrily Gumpel, Trustees of the Glenn and Merrily Gumpel Family Trust dated October 8, 2001, Appellants (Plaintiffs/Third Party Defendants), v. COPPERLEAF HOMEOWNERS ASSOCIATION, INC., a Wyoming non-profit corporation; Roderick Fuller and Kathleen A. Fuller, Trustees of the Roderick and Kathleen Fuller Family Trust dated January 16, 1997; Mooncrest Ranch a/k/a Mooncrest Ranch, Inc., a Wyoming Corporation successor by merger to Rocking M Ranch, Inc.; and Wells Fargo Bank, N.A. Appellees (Defendants/Third Party Plaintiffs).
• Court: Wyoming Supreme Court

393 P.3d 1279

Glenn J. GUMPEL and Merrily Gumpel, Trustees of the Glenn and Merrily Gumpel Family Trust dated October 8, 2001, Appellants (Plaintiffs/Third Party Defendants),

v.COPPERLEAF HOMEOWNERS ASSOCIATION, INC., a Wyoming non-profit corporation; Roderick Fuller and Kathleen A. Fuller, Trustees of the Roderick and Kathleen Fuller Family Trust dated January 16, 1997; Mooncrest Ranch a/k/a Mooncrest Ranch, Inc., a Wyoming Corporation successor by merger to Rocking M Ranch, Inc.; and Wells Fargo Bank, N.A. Appellees (Defendants/Third Party Plaintiffs).

S-16-0167

Supreme Court of Wyoming.

May 2, 2017

Representing Appellants: Matthew W. Kim-Miller and Jordan P. Helvic of Holland & Hart LLP, Jackson, WY. Argument by Mr. Kim-Miller.

Representing Appellees: Steven F. Freudenthal of Freudenthal & Bonds, P.C., Cheyenne, WY.

Before BURKE, C.J., and HILL, DAVIS, FOX, and KAUTZ, JJ.

HILL, Justice.

[¶1] This is an appeal from the district court's ruling in a dispute between two neighboring Park County communities, the China Wall Tract and the Copperleaf Subdivision. The court interpreted the China Wall Tract's restrictive covenants in a manner that will allow Copperleaf property owners access to and through certain areas in the China Wall Tract. The Gumpel Family Trust, dated October 8, 2001 (Gumpel Trust), owns property in the China Wall Tract, and Glenn and Merrily Gumpel, as trustees and on behalf of the Gumpel Trust, appeal the district court's ruling.

[¶2] We conclude that the district court did not err in its interpretation of the covenants, but we modify the court's ruling to clarify that an "invitee" and an "owner" do not share equivalent rights under the covenants. We thus affirm, as modified.

ISSUES

[¶3] Gumpel Trust states the issues on appeal as follows:

A. Whether, based on a de novo review, the ambiguous "2005 Covenants" should have been interpreted in light of its surrounding circumstances so as to prohibit the Copperleaf "Tract O" owner, the Copperleaf lot owners and the Copperleaf HOA from accessing areas in the "China Wall Tract" outside of the Copperleaf Tract O open space?

B. Whether, based on a de novo review, the 2005 Covenants should have been reformed because of mutual mistake to prohibit the Copperleaf Tract O owner, the Copperleaf lot owners and the Copperleaf HOA from accessing areas in the China Wall Tract outside of the Copperleaf Tract O open space?

C. Whether, as a matter of law, based on the language of the 2005 Covenants, the Copperleaf lot owners and Copperleaf HOA are prohibited from accessing areas in the China Wall Tract outside of the Copperleaf Tract O open space?

D. Whether the 2005 Covenants' purported easement over the "recreational land" and hiking and riding trails near the rocky geological feature known as the "china wall" is void under W.S. § 34-1-141(a) ?

FACTS

[¶4] This dispute involves two neighboring Park County communities, the China Wall Tract and the Copperleaf Subdivision. The China Wall Tract is located in Section 15, T. 52N, R. 105W, 6th P.M., Park County, Wyoming (Section 15). It consists of the Section 15 lands north of the centerline of the North Fork of the Shoshone River (North Fork) and includes approximately 600 acres owned by ten different land owners. Copperleaf Subdivision is a located to the south of the China Wall Tract and includes property in Sections 15, 22, and 23 T. 52N, R. 105W, 6th P.M., Park County, Wyoming. It consists of 131 single family lots, a tract for condominiums, and four additional tracts of land, and it encompasses a total of approximately 553 acres. Tract O is the largest tract, at approximately 292 acres, and is dedicated to open space.

[¶5] Tract O extends into Section 15 and into the China Wall Tract, but otherwise most of the Copperleaf Subdivision is located south of Section 15 and south of the North Fork¹ . The following map depicts how these communities are situated, as well as the Gumpel Trust property² :

A. History of Section 15 and Copperleaf Development

[¶6] In 1980, YX Ranch, as owner and developer of Section 15, executed and recorded a "Declaration of Restrictions, Conditions and Protective Covenants" for Section 15 (hereinafter 1980 Covenants). The 1980 Covenants were applicable to all lots in Section 15. Concerning access to the Section 15 property north of the North Fork, now known as the China Wall Tract, Paragraph 9(a) provided that "[a]ccess to the property north of the Shoshone River will be by private bridge and private road as designated on the plat recorded with the County Clerk and referred to herein."

[¶7] In 2004, the predecessor in interest to Worthington Group of Wyoming, Inc. (Worthington Group) began developing the Copperleaf Subdivision and submitted a sketch plan and related development applications to Park County.³ The proposed subdivision extended into Section 15, with Tract O, the land dedicated to meeting the subdivision's county-imposed open space requirement, extending substantially into the area of Section 15 north of the North Fork. Because the proposed subdivision extended into Section 15, Worthington Group had to negotiate to have the 1980 Covenants vacated and replaced with covenants that would accommodate the proposed subdivision, including Tract O.

[¶8] By this time, the Section 15 lots were no longer owned by a single entity, and Worthington Group was thus required to negotiate with several Section 15 landowners to vacate the 1980 Covenants. The negotiations lasted several months and involved a number of issues, including cost sharing for replacement of the bridge over the North Fork, the safety of which had been called into question, access easements both north and south of the North Fork, and recreational and fishing rights both north and south of the North Fork. They concluded in 2005 and resulted in "new restrictions, conditions and protective covenants for the lands in Section 15, Township 52 North, Range 105 West, 6th PM, Park County, Wyoming, which lie north of the centerline of the North Fork of the Shoshone River[.]"

[¶9] The new covenants, entitled "March 21, 2005 Declaration of Restrictions, Conditions and Protective Covenants for Section 15 (China Wall Tract)" (hereinafter 2005 Covenants), were recorded on August 14, 2006. With regard to access and easement rights, the 2005 Covenants generally provided China Wall Owners access as defined by a 1980 Record of Survey, recorded on January 24, 1980.

[¶10] Park County approved the final plat for the Copperleaf Subdivision on March 14, 2006, and on September 21, 2007, Worthington Group recorded the plat and restrictive covenants for the Copperleaf Subdivision. At some point thereafter, Worthington Group defaulted on its mortgage obligations, and on December 8, 2010, the Park County Sheriff conducted a foreclosure sale on property within Copperleaf Subdivision on which Worthington Group had given mortgages to Shoshone First Bank, predecessor to Wells Fargo Bank, N.A. (Wells Fargo). Through that foreclosure sale, Wells Fargo purchased the great majority of the single family lots, Tracts O, R, S, and W, and most of the condominium lots in Tract F. On March 5, 2012, Wells Fargo recorded the Sheriff's Deed that conveyed it title to that property.

B. Present Dispute and Proceedings in District Court

[¶11] On September 30, 2011, the president of the Copperleaf Homeowners Association (Copperleaf HOA) sent a letter addressed to property owners in the China Wall Tract. The letter concerned fishing rights on the North Fork and stated, in part:

Attached is a plat map which outlines the boundaries of the Copperleaf lands as platted. The thread (or centerline) of the river has been highlighted in red, yellow, and blue. The portion of the river that is indicated in red, lies within section 15 and may be accessed by Copperleaf property owners and property owners in Section 15 per the [2005 Covenants]. Please note that this area of the river within Section 15 lies approximately 300 feet to the north and west of the bridge and continues west as indicated.

The portion of the river that is indicated in yellow is bound by Copperleaf lands on the north and south sides of the river, lies within Section 22 and is not an area available to anyone for access, parking and fishing or recreating other than Copperleaf property owners. This seems to be the area of greatest misunderstanding.

[¶12] The dispute over the location of the China Wall Owners' fishing rights continued, and on October 29, 2012, a number of property owners in the China Wall Tract filed a complaint in district court against the Copperleaf HOA, alleging the HOA was interfering with their fishing rights.⁴ Through their complaint, Plaintiffs sought a declaration that under the 2005 Covenants the China Wall Owners are entitled to recreational use of the north and south sides of the North Fork in both Sections 15 and 22. Plaintiffs further alleged that "[a]s a result of a scrivener's error and/or mutual mistake of the parties, the 2005 Covenants failed to adequately set out" the China Wall Owners' recreational access to the North Fork in both Sections 15 and 22. Plaintiffs thus also requested that the 2005 Covenants be reformed to correct the mistake.

[¶13] On December 3, 2012, Copperleaf HOA filed its answer and counterclaims. Through its counterclaims, Copperleaf HOA sought declaratory and injunctive relief: 1) limiting the access route through Copperleaf Subdivision that China Wall Owners are entitled to use to access their property; 2) recognizing the rights of Copperleaf HOA and its members to have walking and vehicular access to Tract O in Section 15; and 3) recognizing the right of Copperleaf HOA and its members to have walking and vehicular access through the China Wall Tract to National Forest lands north of the China Wall Tract.

[¶14] On April 3, 2014, Copperleaf HOA amended its answer and counterclaims to assert additional claims for declaratory and injunctive relief. The additional claims sought relief: 1)...