RDC Melanie Drive, LLC v. Eppard
| Decision Date | 15 July 2021 |
| Docket Number | No. 48,48 |
| Parties | RDC MELANIE DRIVE, LLC v. MARK EPPARD, ET AL. |
| Court | Court of Special Appeals of Maryland |
RDC MELANIE DRIVE, LLC
v.
MARK EPPARD, ET AL.
No. 48
COURT OF APPEALS OF MARYLAND
Argued: May 6, 2021
September Term, 2020
July 15, 2021
CIVIL PROCEDURE - RES JUDICATA - COLLATERAL ESTOPPEL
The Court of Appeals held that the issue of whether restrictive covenants prohibited a commercial golf driving range on any lot within a residential subdivision was neither barred by res judicata nor collateral estoppel. Res judicata did not apply because the issues litigated in a previous matter and the current matter were distinct. The former concerned a zoning variance and the latter concerned the application of a restrictive covenant. Collateral estoppel did not apply because a zoning board in the first matter expressly declined to consider the issue of restrictive covenants, which prevented the issue from being "actually litigated and determined by a valid and final judgment[.]" Cosby v. Dep't of Hum. Res., 425 Md. 629, 639, 42 A.3d 596, 602 (2012).
PROPERTY LAW - RESTRICTIVE COVENANTS - CONSTRUCTION AND OPERATION
The Court of Appeals held that a restrictive covenant unambiguously intended to preserve the residential character of a small, single-family home community by applying a "reasonable construction" of a restrictive covenant as first articulated by the Court in Belleview Construction Co. v. Rugby Hall Community Ass'n, 321 Md. 152, 158, 582 A.2d 493, 496 (1990) (citation and internal quotation omitted). The Court also concluded that a majority of homeowners within the residential community validly amended the restrictive covenant by prohibiting a commercial golf driving range on any of the lots within the community. The amendment clarified a preexisting and uniform restriction on all of the lots that prevented offensive or noxious trades or activities and any activity that may become an annoyance or nuisance.
PROPERTY LAW - RESTRICTIVE COVENANTS - CONSTRUCTION AND OPERATION
The Court of Appeals held that a restrictive covenant unambiguously permitted the realignment of a lot boundary line. A restrictive covenant prohibited the creation of new lots through subdivision but expressly permitted the "adjustment or realignment of boundary lines[.]" A property owner permissibly realigned the boundary of their property pursuant to the plain language of the restrictive covenant.
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Circuit Court for Talbot County
Case No. C-20-CV-18-000079
Barbera, C.J., McDonald, Watts, Hotten, Getty, Booth, Biran, JJ.
Opinion by Hotten, J.
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The parties in this appeal own property in the Swan Point Subdivision ("Swan Point"), located in Talbot County, Maryland.1 Swan Point consists of six lots, reflected in the tax record as Lots A, B, C, D, 5, and 6. Petitioner, RDC Melanie Drive, LLC ("RDC") owns a nearby golf course, now known as the Links, and purchased Lot 6 in 2015. The present dispute arises from an effort by RDC to convert Lot 6 into a commercial golf driving range ("a driving range" or "the driving range"). Respondent, Mark Eppard, et al. ("Homeowners"), represent four of the other five property owners in Swan Point who oppose RDC's proposed plan to construct a driving range on Lot 6.2
On August 21, 2017, RDC applied for zoning variances and exceptions from the Talbot County Board of Appeals ("the Board") to modify the boundaries of Lot 6 and to construct the driving range. The Homeowners opposed the variance, contending that a restrictive covenant, applicable to all lots within Swan Point, prevented the construction of the driving range. The Board did not address the issue of the restrictive covenant, but granted the zoning variance for RDC. In response, the Homeowners amended the restrictive covenant to specifically prohibit a driving range on any lot within Swan Point.
The Homeowners sought judicial review of the Board's determination in the Circuit Court for Talbot County. Following a hearing on May 16, 2018, the circuit court found
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that most of the decisions of the Board were supported by substantial evidence and following a remand to the Board for additional findings, affirmed the decisions of the Board on November 19, 2018.
The Homeowners sought a declaratory judgment in the circuit court for a determination that the original Swan Point restrictive covenant, the Homeowners' amendment to the original Swan Point restrictive covenant, and a restrictive covenant specifically applicable to Lot 6—recorded in 2008 by former owners Vladimir D. Zajic and Etta K. Zajic ("Zajic Declaration")—prohibited the driving range. RDC filed a counter complaint, contending that the development of a driving range and a realignment of the property boundaries of Lot 6 was not prohibited by the restrictive covenants. The circuit court entered a declaratory judgment, concluding that the Homeowners' amended restrictive covenant validly prohibited the construction of a driving range on Lot 6, and the original Swan Point restrictive covenant permitted the realignment of Lot 6 property boundaries. The circuit court also declared that the controversy surrounding the Zajic Declaration was moot by virtue of the other declarations.
The parties cross-appealed the decision of the circuit court to the Court of Special Appeals, which affirmed. The Court of Special Appeals consolidated the questions presented and held that the determination of whether the original Swan Point restrictive covenant prohibited a driving range was not precluded by collateral estoppel and that the Homeowners' amended restrictive covenant validly prohibited a driving range on Lot 6. The Court of Special Appeals further held that the circuit court did not err when it declared the Zajic Declaration moot and that the circuit court correctly determined that it was
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permissible under the original Swan Point restrictive covenant for RDC to realign the boundaries of Lot 6.
RDC timely appealed to this Court and the Homeowners filed a cross-petition. We granted the petition for certiorari and the cross-petition on January 6, 2021, RDC Melanie Drive, LLC v. Eppard, 472 Md. 4, 243 A.3d 1198 (2021), which resolve into the following five questions:
1. Whether the factual issue of whether a driving range constitutes a "noxious or offensive trade or activity" or causes any "annoyance or nuisance" is precluded by res judicata or collateral estoppel.
2. Whether the Original Declaration unambiguously restricts various activities to preserve the residential character of a small community of single-family homes?
3. Whether the Amended Declaration validly clarified the terms of the Original Declaration by prohibiting a commercial driving range on any lot within Swan Point?
4. Whether Article III, Paragraph 1, Subparagraph (k) of the Original Declaration permits the revision of existing lot lines?
5. Whether the controversy regarding the Zajic Declaration is moot?3
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We answer the first question in the negative, the second, third, and fourth questions in the affirmative and accordingly shall affirm the judgment of the Court of Special Appeals. We need not reach the fifth question presented.
The Links, formerly known as the Harbourtowne Golf Course, is a golf course located in St. Michaels, Maryland. The Links was originally developed in the 1970s and
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is now part of the Perry Cabin resort. Swan Point was developed in 1988 and is adjacent to and contiguous with the Links. Swan Point contains six lots: A, B, C, D, 5, and 6.4
Each lot at Swan Point is subject to the covenants and restrictions described in the "DECLARATION OF RESTRICTIONS, COVENANTS AND CONDITIONS SWAN POINT" ("the Original Declaration"). In pertinent part, the Original Declaration provided:
WHEREAS, the Declarants desire to provide for the preservation of the values and amenities in the community comprised of their collective properties; and to this end, desire to impose upon the Property [i.e., Swan Point] the covenants, restrictions, easements and equitable servitudes, hereinafter set forth, each and all of which are for the benefit of the Property and the owners thereof. . . . [A]ll of which are declared and agreed to be in aid of a plan for the improvement of the Property . . . and shall inure to the benefit of and be enforceable by the Declarants, their successors and assigns, and any person acquiring or owning an interest in the Property, including, without limitation, any person, group of persons, . . . or other legal entity. . . .ARTICLE I *** (a) "Declarant" shall mean and refer to the Declarants hereinabove identified in the preamble to this Declaration, and their successors and assigns. . . .
(b) "Dwelling" shall mean and refer to any building or portion of a building situated upon the Property and designed and intended for use and occupancy as a residence by a single person or family.*** ARTICLE III
1. Prohibited Uses and Nuisances. Except for the activities of the Declarant during the construction or development of the community:
(a) No noxious or offensive trade or activity shall be carried on upon any Lot or within any dwelling, nor shall anything be done therein or
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thereon, which may be or become an annoyance or nuisance to the neighborhood or other Owners. Without limiting the generality of the foregoing, no speaker, horn, whistle, siren, bell, amplifier or other sound device, except such devices as may be used exclusively for security purposes, shall be located, installed or maintained upon the exterior of any dwelling or upon the exterior of any other improvements constructed upon any Lot. No snowmobiles, go-carts, motor bikes, trail bikes or other loud engine recreational vehicles shall be run or operated upon any Lot or upon the roads serving the Property....*** (b) The maintenance, keeping, boarding or raising of animals, livestock, or poultry of any kind, regardless of number, shall be and is hereby prohibited on any Lot or within any dwelling, except that this provision shall not prohibit the keeping of horses, dogs, cats or customary household animals,
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