Redfearn v. HUNTCLIFF HOMES ASS'N, INC.

• Decision Date: 23 November 1999
• Docket Number: No. S99X1124., No. S99A1121
• Citation: 524 S.E.2d 464,271 Ga. 745
• Parties: REDFEARN et al. v. HUNTCLIFF HOMES ASSOCIATION, INC. Huntcliff Homes Association, Inc. v. Redfearn et al.
• Court: Georgia Supreme Court

524 S.E.2d 464

271 Ga. 745

REDFEARN et al. v. HUNTCLIFF HOMES ASSOCIATION, INC.

Huntcliff Homes Association, Inc. v. Redfearn et al.

Nos. S99A1121, S99X1124.

Supreme Court of Georgia.

November 23, 1999.

Chilivis, Cochran, Larkins & Bever, Nickolas P. Chilivis, John K. Larkins, Jr., Atlanta, Brian V. Patterson, for appellants.

Weissman, Nowack, Curry & Wilco, Leigh M. Wilco, Derek W. Johanson, Atlanta, for appellees.

SEARS, Justice.

This appeal is brought from the trial court's grant of summary judgment awarding a homeowner's association injunctive relief to remedy the violation of its restrictive covenants. In answering the homeowner's association's complaint, the defendant homeowners claimed that they had been accorded special permission to disregard the covenants. The homeowners also asserted the equitable defense of laches. Appeals concerning a trial court's ruling on a claim for injunctive relief in order to remedy the violation of restrictive covenants are not within the Supreme Court's constitutional grant of jurisdiction over "equity cases." Furthermore, the mere assertion on appeal that the trial court erred in ruling on an equitable defense such as laches does not place an appeal within the Supreme Court's jurisdiction. Accordingly, this appeal must be transferred to the Court of Appeals.

Alec and Margaret Redfearn hold title to two adjoining lots in the Huntcliff subdivision, located in Roswell, Georgia. One of the lots remained undeveloped, while the other lot served as the site of the original Redfearn residence. In time, the Redfearns decided to build a new house on the undeveloped lot, and began preparations for its construction. Recorded restrictive covenants that apply to the Huntcliff subdivision require that all new homes must be approved by the Huntcliff Homes Association, Inc. ("the Association"), and mandate that all new construction must comply with a 25 foot setback requirement. The covenants, however, allow that the setback requirement may be waived by written permission of the Association.

The Association failed to approve several plans submitted by the Redfearns for the construction of their new house. Eventually, however, the parties reached a written agreement ("the Agreement") regarding construction of the house, in which the Redfearns agreed, among other things, to relocate the property line between their two tracts. According to the Redfearns, they understood the Agreement to include the Association's approval of construction within the setback area of a driveway and a turnaround that would be supported by a 12 foot high retaining wall abutting the neighboring property. The Association contends that it did not approve the retaining wall, and that it had no prior notice of the Redfearns' intention to build the wall.

On April 18, 1997, construction of the retaining wall was completed at a cost of $13,000. On April 30, the Association informed the Redfearns that it considered the wall to violate the covenant requiring the 25 foot setback, and on May 6, the Association filed suit seeking injunctive relief enforcing the covenant and the recovery of attorney fees. In their answer, the Redfearns claimed they had the Association's permission to build the wall, and asserted the affirmative defense of laches.

The trial court granted partial summary judgment to the Association, granting its request for injunctive relief and ordering the Redfearns to remove the wall. The trial court denied the Association's claim for attorney fees. The Redfearns appealed directly to this Court claiming that the Agreement between them and the Association permitted construction of the retaining wall, and also claiming that the trial court erred in rejecting their defense of laches. The Association filed a cross-appeal challenging the trial court's denial of its request for attorney fees.

1. It is, of course, the Supreme Court's duty to raise and resolve questions pertaining to its jurisdiction whenever there is any doubt concerning whether such jurisdiction exists.¹ This duty is especially important when it impacts upon the Court's constitutional grant of jurisdiction over equity cases,² the definition of which has been the subject of confusion and frustration for the Georgia bar as well as both of Georgia's appellate courts.³ The uncertainty surrounding equity jurisdiction, however, is not a recent occurrence, as it existed even when the distinction between law and equity was a great deal more pronounced than it is today.⁴ The concept of "equity" has been evolving for many years, and today much of what used to be considered substantive principles of equity have merged into our law to the extent that they no longer retain their uniquely equitable character.⁵ In order to keep pace with both the law's absorption of certain equitable principles, as well as other developments in equity, this Court must continue to delineate as clearly as possible the scope of its jurisdiction over "equity cases."⁶

2. In 1991, this Court issued Beauchamp v. Knight,⁷ which held that whether an action is an equity case for the purpose of determining jurisdiction on appeal "depends upon the issue raised on appeal, not upon how the case is styled nor upon the kinds of relief which may be sought by the complaint,"⁸ and that "[c]ases in which the grant or denial of such relief are merely ancillary to underlying issues of law, or would have been a matter of routine once the underlying issues were resolved, are not equity cases."⁹

Beauchamp's guidelines for this Court's exercise of equity jurisdiction were refined in Pittman v. Harbin Clinic Professional Assn.,¹⁰ which involved a claim for injunctive relief based upon restrictive covenants found in employment contracts between physicians and the clinic at which they practiced. In Pittman, we reiterated that "whether an action is an equity case for the purpose of invoking appellate jurisdiction in this court depends (up)on the issue raised on appeal."¹¹ Based upon that principle, we determined that the primary issue to be resolved in Pittman was whether the trial court properly construed restrictive covenants found in the contracts, and we concluded that the grant or denial of equitable relief was entirely ancillary to that underlying legal issue.¹² Accordingly, the Supreme Court was without jurisdiction to decide Pittman, and the appeal was transferred to the Court of Appeals. Since it was decided, Pittman has consistently been relied upon for the proposition that appeals addressing the trial court's grant or denial of equitable relief for the breach of restrictive covenants do not come within the Supreme Court's jurisdiction.¹³

The present matter, like Pittman, is concerned with whether the trial court erred in finding that the Redfearns violated both the Association's restrictive covenants and the Agreement concerning construction of the new house. On appeal, the Redfearns assert that the trial court erroneously construed the Agreement, which they argue relieved them of the obligation to comply with the 25 foot setback requirement contained in the covenants. Relying upon the express terms of both documents, the trial court found that the Redfearns' construction of the retaining wall within 25 feet of the adjoining property line violated both the covenants and the Agreement. Thus, "the primary issue" to be resolved in this appeal "is whether the trial court properly construed the contracts" at issue, and while the Association did seek equitable relief, the trial court's resolution of the equitable claim was "secondary to the principal issue of the construction of the contracts —an issue of law."¹⁴ It follows that under Pittman, because the primary issue to be resolved is legal and the viability of any equitable claim is ancillary thereto, this appeal is outside the realm of the Supreme Court's jurisdiction over "equity cases."

3. The Redfearns' enumeration as error on appeal of the trial court's rejection of their laches defense does not take this case out of the Pittman analysis discussed above, and does not place this case within the Supreme Court's jurisdiction. Quite to the contrary, this Court has consistently transferred cases that are identical to the present matter (i.e.—suits seeking injunctive relief for the breach of restrictive covenants in which laches is asserted as a defense) to the Court of Appeals under the authority of Pittman.¹⁵

Furthermore, as discussed above, this Court's seminal case on equity jurisdiction, Beauchamp v. Knight, states that whether an action is an equity case for the purposes of appellate jurisdiction depends upon the issue raised on appeal, not upon the kinds of relief sought in the complaint.¹⁶ It only stands to reason that if the relief sought in a complaint cannot be a basis for determining equity jurisdiction, neither can the defenses asserted in the answer to such a complaint. It is for this reason that the Supreme Court has consistently held that neither the mere assertion of an equitable defense in the trial court, nor the enumeration as error on appeal of the trial court's ruling on such a defense, converts a case into one that falls within its equity jurisdiction.¹⁷ In fact, the Court of Appeals has expressly stated that it has jurisdiction over appeals concerning equitable defenses,¹⁸ and has recognized that the assertion of an equitable defense does not give the Supreme Court jurisdiction of an appeal that otherwise falls within the Court of Appeals' jurisdiction,¹⁹ thereby affirming that any equitable defense (including but not limited to laches, unclean hands, estoppel and equal fault) asserted in response to a complaint seeking equitable relief does not invoke the Supreme Court's jurisdiction to decide an appeal.²⁰

4. The ruling in Division 3, above, is consistent with Pittman's pronouncement that the Supreme Court lacks jurisdiction to decide appeals in which the grant or denial of...