Phelps v. Cmty. Garden Ass'n, Inc.
Decision Date | 11 April 2019 |
Docket Number | No. 107127,107127 |
Citation | 2019 Ohio 1364 |
Parties | WILLIE PHELPS, ET AL. PLAINTIFFS - APPELLANTS v. COMMUNITY GARDEN ASSOCIATION, INC. DEFENDANT-APPELLEE |
Court | Ohio Court of Appeals |
ATTORNEYS FOR APPELLANTS
Brad A. Straka
Lieberman, Dvorin & Dowd, L.L.C.
30195 Chagrin Boulevard, Suite 300
Pepper Pike, OH 44124
Steven M. Ott
Lindsey A. Wrubel
Callie J. Channell
Ott & Associates Co., L.P.A.
1300 East 9th Street, Suite 1520
Cleveland, OH 44114
David L. Lester
Collins, Roche, Utley, & Garner, L.L.C.
875 Westpoint Parkway, Suite 500
Cleveland, OH 44145
{¶1} Plaintiffs-appellants Willie and Brenda Phelps ("Phelps") own real property located in the Elizabeth B. Blossom Union Subdivision in Beachwood, Ohio. The houses that comprise the subdivision are subject to a Declaration of Restrictions ("Declaration"). There is a private park adjacent to the houses that was established for the subdivision's benefit. Defendant-appellee Community Garden Association, Inc. ("CGA") is a nonprofit corporation that administers the park and is funded by property owners in the subdivision through assessments. The Phelps have never paid assessments to CGA. Following CGA's attempt to collect assessments from them, the Phelps brought an action seeking a declaration that they are not members of the association and, therefore, they are not obligated to pay to it any dues or assessments. They also asserted claims of retaliation and discrimination in violation of state and federal statutes. CGA answered and counterclaimed, seeking a declaration of their own that the Phelps are members of the association and that they are obligated to pay assessments pursuant to the Declaration.
{¶2} CGA moved for summary judgment on the Phelps' claims and its counterclaim and the trial court granted said motions. In so doing, the court interpreted the Declaration as adopted in 1978 and as amended in 2007. Pursuant to its interpretation, the court found that the Phelps were members of CGA and were obligated to pay assessments, late fees and attorney fees, in the subsequently determined amount of $17,253.84. The court also granted CGA summary judgment as to the claimed violations of state and federal law.
{¶3} The Phelps now appeal and raise four assignments of error. The Phelps argue that the trial court erred by finding that they are members of the association. They argue that they are not obligated to pay CGA assessments. They dispute the court's calculation of damages and they complain that the court improperly subjected their discrimination and retaliation claims to a heightened pleading standard. For the reasons that follow, we affirm in part, reverse in part and remand.
{¶4} In August of 2003, the Phelps took title to their property through a deed that provided that the property was "free and clear from all liens and encumbrances, except zoning ordinances, easements, restrictions and conditions of record * * *." There is no dispute that when the Phelps took title to the property, they had notice that it was a part of the subdivision and that it was subject to the Declaration as adopted in 1978 and thereby bound to its terms. {¶5} It is similarly undisputed that, at that time, the Declaration did not contain a requirement that obligated property owners to pay assessments. The Declaration did however contain an amendment provision in section 16:
The Covenants and Restrictions may be terminated or amended at any time by the affirmative vote of Owners representing seventy percent or more of the voting power of all Owners.
{¶6} In May 2007, the Declaration was amended to create an obligation for property owners to pay assessments to CGA. There is no dispute that "seventy percent or more" of the owners voted for the amendment and that it otherwise complied with the procedure required by section 16.1
{¶7} The Declaration as amended contains section 18, which defines the types of assessments that the association may impose, the terms of payment and the consequences of nonpayment. It also outlines the association's obligation to provide owners specific notice in writing about assessments.
{¶8} In relevant part, section 18(A) makes clear that each owner is required to pay assessments:
Each Owner of any Sublot, either by present ownership or by acceptance of the deed therefor, whether or not it shall be so expressed in the deed, hereby covenants and agrees to pay the Association regular assessments and special assessments as provided for in this Declaration, and covenants to the enforcement of payment of the assessments and the lien of the Association as hereinafter provided. Such assessments shall be fixed, established, and collected from time to time as provided by the Association. The regular and special assessments, together with any interest thereon and costs of collection thereof, including reasonable attorney's fees, shall be a charge upon each Sublot and a continuing lien upon each Sublot against which each such assessment is made.
{¶9} In relevant part, section 18(E) obligates the association to provide written notice as to any assessment:
Written notice of the assessment for each assessment year shall be sent to every Owner subject thereto at least thirty (30) days prior to the commencement of the Assessment Year. The Association shall have the obligation to provide the Owner of each and every Sublot with written notice as to the amount of the Assessment in effect with respect to said Sublot at the time the Owner notifies the Association that such Owner has acquired an ownership interest in said Sublot. Said written notice shall set forth the amount of the periodic installment of Assessments and the dates on which the same are due and payable. Thereafter, the Association shall be obligated to provide written notice of the periodic installment of Assessments only when the amount or payment date thereof changes. All such notices shall be effective as of the date set forth therein and may be delivered to the Owner personally, sent to the address of the Sublot via ordinary U.S. Mail, or conspicuously posted at the Sublot.
{¶10} We review summary judgment rulings de novo, applying the same standard as the trial court. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241 (1996). We accord no deference to the trial court's decision and conduct an independent review of the record to determine whether summary judgment is appropriate.
{¶11} Under Civ.R. 56, summary judgment is appropriate when no genuine issue exists as to any material fact and, viewing the evidence most strongly in favor of the nonmoving party, reasonable minds can reach only one conclusion that is adverse to the nonmoving party entitling the moving party to judgment as a matter of law.
{¶12} On a motion for summary judgment, the moving party carries an initial burden of identifying specific facts in the record that demonstrate his or her entitlement to summary judgment. Dresher v. Burt, 75 Ohio St.3d 280, 292-293, 662 N.E.2d 264 (1996). If the moving party fails to meet this burden, summary judgment is not appropriate; if the moving party meets this burden, the nonmoving party has the reciprocal burden to point to evidence of specific facts in the record demonstrating the existence of a genuine issue of material fact for trial. Id. at 293. Summary judgment is appropriate if the nonmoving party fails to meet this burden. Id.
{¶13} The Phelps argue that the trial court erred by determining that they are and, are required to be, members of the association. We agree.
{¶14} Contrary to CGA's contention and the trial court's finding, the Declaration imposes no requirement that an owner join the association. The Declaration as adopted in 1978 makes no mention of the association. While the Declaration as amended does refer to the association, and requires owners to pay assessments to it, it does not create or contain any membership requirement. According to the plain language of the Declaration, there is nothing that requires an owner to be an association member. See Cleveland Baptist Assn. v. Scovil, 107 Ohio St. 67, 71-72, 140 N.E. 647 (1923) (). We refuse to recognize a membership requirement where the Declaration clearly does not.
{¶15} Our conclusion that the Phelps are neither association members, nor required to be, is further supported by CGA's Articles of Incorporation, as adopted in 1978 and as restated in 2010 which explicitly states the criteria for membership in the association:
Membership is limited to natural persons who (a) own a sublot which is restricted by certain Covenants and Restrictions set forth in [the declaration], (b) are in full and complete compliance with such Covenants and Restrictions; and (c) satisfy all other membership requirements set forth in these Amended Articles of Incorporation and the Code of Regulations of the Corporation.
{¶16} Here, it is true that the Phelps "own a sublot which is restricted by certain Covenants and Restrictions." And regardless of whether the Phelps "satisfy all other membership requirements," since they have not paid the required assessments, they are clearly not "in full and complete compliance with such Covenants and Restrictions." Indeed, this is CGA's chief complaint against the Phelps.
{¶17} The association's internal records provide no basis to conclude that the Phelps are CGA members or that membership is mandatory. Indeed, minutes from a ...
To continue reading
Request your trial