Medearis v. TRUSTEES OF MPBC

• Court: North Carolina Court of Appeals
• Writing for the Court: BRYANT.
• Citation: Medearis v. TRUSTEES OF MPBC, 558 S.E.2d 199, 148 NC App. 1 (N.C. App. 2001)
• Decision Date: 28 December 2001
• Docket Number: No. COA01-114.,COA01-114.
• Parties: William F. MEDEARIS, III and wife, Pauline Phister Medearis, Petitioners-Appellants, v. TRUSTEES OF MEYERS PARK BAPTIST CHURCH, C.D. Spangler Foundation, Inc., and Queens College, Inc., Respondents-Appellees.

558 S.E.2d 199

148 NC App. 1

William F. MEDEARIS, III and wife, Pauline Phister Medearis, Petitioners-Appellants, v. TRUSTEES OF MEYERS PARK BAPTIST CHURCH, C.D. Spangler Foundation, Inc., and Queens College, Inc., Respondents-Appellees.

No. COA01-114.

Court of Appeals of North Carolina.

December 28, 2001.

DeVore, Acton & Stafford, P.A., by Fred W. DeVore, III, Charlotte, for petitioners-appellants.

Kennedy, Covington, Lobdell & Hickman, L.L.P., by Roy H. Michaux, Jr., Charlotte, for respondent-appellee, Trustees of Meyers Park Baptist Church.

Robinson, Bradshaw & Hinson, P.A., by John R. Wester, Charlotte, for respondent-appellee C.D. Spangler Foundation, Inc.

Guthrie, Davis, Henderson & Staton, P.L.L.C., by Robert E. Henderson, Charlotte, for respondent-appellee, Queens College.

BRYANT, Judge.

This is an appeal by William F. Medearis, III, and his wife, Pauline Phister Medearis [petitioners] from an order granting the Trustees of Myers Park Baptist Church [MPBC], the C.D. Spangler Foundation, Inc. [Foundation] and Queens College, Inc. [collectively "respondents"] summary judgment on a petition for declaratory judgment to determine the rights of the petitioner-homeowners to enforce a restrictive covenant. Petitioners assign as error the trial judge's granting of summary judgment to respondents after concluding, inter alia, that: 1) real property that was restricted to residential use only had undergone such a radical change as to practically render the restrictive covenant nugatory; and 2) petitioners waived their right to enforce the restriction.

The facts of this case span eighty-five years and are not in dispute. At issue is a residential restriction covering twelve of fourteen lots in Block 37 of the Myers Park subdivision in Charlotte. Petitioners seek to prevent respondents from expanding a church complex by building the Cornwell Family Life and Learning Center [Cornwell Center], named after the Spangler family.

From 1914 to 1921, the Stephens Company developed Block 37, dividing it into fourteen lots. See Illustration 1. The lots are numbered as follows: 1, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14A and 14B. There is no Lot 2. Lots 3 through 14A form a rectangle, with Lots 3 through 8 on one side, and Lots 9 through 14A on the other, 9 being across from 8. Lots 3 through 14A contain identical deed restrictions, including a covenant that the property only be used for residential purposes. The deeds also provide that "[i]t is expressly understood and agreed ... that all of the foregoing covenants, conditions and restrictions, which are for the protection and general welfare of the community shall be covenants running with the land." Lots 1 and 14B are adjacent to Lots 3 and 14A, respectively. They do not contain residential restrictions.¹

By 1929, ten of the twelve restricted lots had residences on them. See Illustration 2. Two of the ten lots—9 and 10—were owned and continue to be owned by the Medearis family. In 1943, the Efirds transferred lots 11, 14A and 14B to MPBC. Between 1948 and the early 1950s, MPBC built a sanctuary and educational building on Lots 1 and 14B, the unrestricted lots. In 1955, MPBC acquired Lot 3 to provide for the future expansion of the church. The structure on the lot was used for church offices. In the early 1960s, plans were approved for construction of a classroom building, fellowship hall and church offices on Lots 1, 3 and 14A. The structure on Lot 3 was demolished to clear the way for this construction. No waivers from the residential restrictions on Lots 3 and 14A were requested.

In 1962, Queens College transferred Lot 5 to MPBC to provide for future expansion of the church. The structure was removed in 1963, and since then the lot has been used for parking and as a playground. Therefore, in the first forty years since the formation of the block, MPBC had acquired three of the twelve restricted lots, removed structures from two of them and built offices and classrooms on two of them.

In 1971, Queens College acquired Lot 7 and the Jones House. The lot has been used for parking since 1974. In 1989, MPBC acquired Lot 6 and the Pressley House. MPBC rented the house for residential purposes until 1994, when it became vacant and remained vacant until it was demolished by MPBC in 2000. In 1991, MPBC acquired Lot 4 and the Withers House. The property was leased to Queens College until 2000 for continuing education classes, conferences, receptions and private functions. MPBC agreed to sell the house to Queens College in 2000 and move the house to Lot 8, where it now stands.

In 1997, the Foundation acquired Lot 12 and the Archer House. It agreed to donate the lot to MPBC. The Foundation sold the house for one dollar. The house was moved off the property in 2000. Lot 12 has been vacant since then.

In December 1998, petitioners purchased Lots 9 and 10 from Mr. Medearis's parents for $880,000. Petitioners moved in on 31 October 1999. In November 1999, the Foundation acquired Lot 11 and its structure, the Baldwin House, for $1.6 million. This house was demolished on 2 February 2000 to prevent MPBC from having to obtain a zoning ordinance to build the Cornwell Center. Therefore, in roughly eighty years since the completion of Block 37, MPBC acquired seven of the twelve restricted lots, removed or demolished at least five structures, and built several buildings for the church complex. One of the remaining five restricted lots belongs to the Foundation, which also demolished the house on the lot. Two of the remaining lots belong to Queens College and are used for parking, classes and social events. The remaining two restricted lots belong to petitioners, who use both lots for a single residence. See Illustration 3.

Petitioners filed an action for declaratory judgment on 3 August 2000 seeking to enforce the residential restrictions against MPBC, the Foundation and Queens College. MPBC and the Foundation filed a joint motion for summary judgment on 12 September 2000. Petitioners filed a notice of voluntary dismissal without prejudice as to Queens College on 18 September 2000, then filed a motion for summary judgment on 27 September 2000. A consent motion to join Queens College was filed on 29 September 2000. Queens College filed a motion for summary judgment on 13 October 2000. The trial court granted respondents' motions for summary judgment on 26 October 2000 and petitioners appealed.

I. Summary Judgment

North Carolina courts have held that summary judgment is an appropriate procedure in an action for declaratory judgment. Frank H. Conner Co. v. Spanish Inns Charlotte, 294 N.C. 661, 242 S.E.2d 785 (1978); Montgomery v. Hinton, 45 N.C.App. 271, 262 S.E.2d 697 (1980). The Declaratory Judgment Act [Act] provides that orders, judgments and decrees under the Act "may be reviewed as other orders, judgments and decrees." N.C.G.S. § 1-258 (1999); see also Nationwide Mutual Ins. Co. v. Allison, 51 N.C.App. 654, 277 S.E.2d 473 (1981) (stating that the Act provides for the application of the same rules of review used in cases not brought under the Act). Therefore, on review of a declaratory judgment action, we apply the standards we would use when reviewing a trial court's denial of a motion for summary judgment.

Upon motion, summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law." N.C.G.S. § 1A-1, Rule 56(c) (1999). "An issue is material if the facts alleged would constitute a legal defense, or would affect the result of the action, or if its resolution would prevent the party against whom it is resolved from prevailing in the action." Koontz v. City of Winston-Salem, 280 N.C. 513, 518, 186 S.E.2d 897, 901 (1972). An issue is genuine if it is supported by substantial evidence. Id. The moving party has the burden of proving that a genuine issue of material fact does not exist. Pembee Mfg. Corp. v. Cape Fear Constr. Co., 313 N.C. 488, 491, 329 S.E.2d 350, 353 (1985). Once the moving party "makes the required showing, the burden shifts to the nonmoving party to produce a forecast of evidence demonstrating specific facts, as opposed to allegations, showing that he can at least establish a prima facie case at trial." Gaunt v. Pittaway, 139 N.C.App. 778, 784-85, 534 S.E.2d 660, 664-65,appeal dismissed and review denied by ___ N.C. ___, 546 S.E.2d 401 (2000), cert. denied, 353 N.C. 371, 547 S.E.2d 810, cert. denied, ___ U.S. ___, 122 S.Ct. 345, 151 L.Ed.2d 261 (2001). The court must examine the moving party's evidence and resolve all inferences against the moving party. Id.

II. Restrictive Covenants

Restrictive covenants are generally not favored by the courts; therefore, ambiguities will be construed in favor of the unrestricted use of the land. Black Horse Run Prop. Owners Ass'n v. Kaleel, 88 N.C.App. 83, 85, 362 S.E.2d 619, 621 (1987). However, "such covenants must be reasonably construed to give effect to the intention of the parties, and the rule of strict construction may not be used to defeat the plain and obvious purposes of a restriction." Id. (citing Long v. Branham, 271 N.C. 264, 156 S.E.2d 235 (1967)). When enforced, restrictive covenants will be enforced to the same extent as any valid contractual relationship. Karner v. Roy White Flowers, Inc., 351 N.C. 433, 436, 527 S.E.2d 40, 42 (2000). Restrictive covenants may be enforced by and against any grantee "`[w]here the owner of a tract of land subdivides it and sells distinct parcels thereof to separate grantees, imposing restrictions on its use pursuant to a general plan of development or improvement....'" Sedberry v. Parsons, 232 N.C. 707, 710, 62 S.E.2d 88, 90 (1950). Id. Restrictions under a general plan of development may be enforced against subsequent purchasers of the land who take with...