Seagate Condominium Ass'n, Inc. v. Duffy

• Decision Date: 15 April 1976
• Docket Number: No. 75--77,75--77
• Citation: 330 So.2d 484
• Parties: SEAGATE CONDOMINIUM ASSOCIATION, INC., a Nonprofit Florida Corporation, Appellant, v. William B. DUFFY and Richard G. Duffy, as Executors of the Estate of Alice M. Duffy, Deceased, Appellees.
• Court: Florida District Court of Appeals

Page 484

330 So.2d 484

SEAGATE CONDOMINIUM ASSOCIATION, INC., a Nonprofit Florida Corporation, Appellant, v. William B. DUFFY and Richard G. Duffy, as Executors of the Estate of Alice M. Duffy, Deceased, Appellees.

No. 75--77.

District Court of Appeal of Florida, Fourth District.

April 15, 1976.

Frederick L. R. Hill, Boynton Beach, and Guy C. Hill, West Palm Beach, for appellant.

Manley P. Caldwell, Jr., of Caldwell, Pacetti, Barrow & Salisbury, Palm Beach, for appellees.

OWEN, Judge.

Appellant-condominium association appeals from a final judgment declaring certain restrictions upon the leasing of condominium units, contained in its Declaration of Condominium, invalid as an unlawful restraint on alienation and awarding appellee-unit owners damages for rents lost as a result of the enforcement of these restrictions.

The restrictive provision in question was added to the appellant's Declaration of Condominium, pursuant to the amendment procedures prescribed therein, upon an affirmative vote of over ninety-six percent of the unit owners. It provided as follows:

'As previously stated, it is the intent that the owner of each unit of Seagate Towers Condominium shall occupy and use such unit as a private dwelling for himself and his immediate family, and for no other purpose including business purposes. Therefore, the leasing of units to others as a regular practice for business, speculative, investment or other similar purposes is not permitted.

To meet special situations and to avoid undue hardship or practical difficulties the Board of Directors may grant permission to an owner to lease his unit to a specified lessee for a period of not less than four consecutive months nor more than twelve consecutive months.'

Appellee-unit owners inherited their unit from their mother, the original purchaser. They received notice of the condominium association meeting at which the amendment was to be considered, but did not attend this meeting and did not return a proxy ballot mailed to them. In fact, they did not voice any objection to the amendment until well after its passage, when it first became apparent that the restriction would interfere with their plans to lease their unit. At that point, they initiated the instant suit. The trial court determined that the amendment was both an unreasonable restriction and an unlawful restraint on alienation and awarded damages to appellees for lost rents.

The ancient rule against restraints on alienation is founded entirely upon considerations of public policy, specifically, the idea that the free alienability of property fosters economic and commercial development. 2 Archbold's Blackstone, Ch. XIX (1825); Simes & Smith, The Law of Future Interests, § 1135 (2nd ed., 1956); Manning, 'The Development of Restraints on Alienation Since Gray,' 48 Harv.L.Rev. 373, 403 (1935); IV Restatement, Property, 2129--33, 2379--80 (1944); 61 Am.Jur.2d, Perpetuities and Restraints on Alienation, § 93 (1972). Competing policy considerations, however, have, almost from the inception of the rule, caused exceptions to be carved out of it. Our courts have traditionally undertaken to determine the validity of restraints by measuring them in terms of their duration, type of alienation precluded, or the size of the class precluded from taking. ¹ 4A Thompson, Real Property, § 2016 (1961); 61 Am.Jur.2d, Perpetuities and Restraints on Alienation, §§ 102--104 (1972). The rule has long been recognized as precluding only Unlimited or Absolute restraints on alienation. Robinson v. Randolph, 21 Fla. 629, 58 Am.Rep. 692 (1885); Davis v. Geyer, 151 Fla. 362, 9 So.2d 727 (1942).

The test which our courts have adopted and applied with respect to restraints on alienation and use ² is reasonableness. E.g., Points v. Barnes, 301 So.2d 102 (4th DCA Fla.1974); Robinson v. Speer, 185 So.2d 730 (1st DCA Fla.1966); Blair v. Kingsley, 128 So.2d 889 (2nd DCA Fla.1961). The question for us here, therefore, is whether appellant's leasing restriction is reasonable given the context in which it was promulgated, i.e., the condominium living arrangement.

Our courts have on several occasions pointed out the uniqueness of the problems of condominium living and the resultant necessity for a greater degree of control over and limitation upon the rights of the individual owner than might be tolerated given more traditional forms of property ownership. Hidden Harbour Estates, Inc. v. Norman, 309 So.2d 180 (4th DCA Fla.1975); Holiday Out in America at St. Lucie, Inc. v. Bowes, 285 So.2d 63 (4th DCA Fla.1973); Sterling Village Condominium, Inc. v. Breitenbach, 251 So.2d 685 (4th DCA Fla.1971); Chianese v. Culley, 397 F.Supp. 1344 (S.D.Fla.1975). As this court said, in Hidden Harbour Estates, Inc. v. Norman, at 181--2:

'. . . inherent in the condominium concept is the principle that to promote the health, happiness, and peace of mind of the majority of the unit owners since they are living in such close proximity and using facilities in common, each unit owner must give up a certain degree of freedom of choice which he might otherwise enjoy in separate, privately owned property. Condominium unit owners comprise a little democratic sub society of necessity more restrictive as it pertains to use of condominium property than may be existent outside the condominium organization.'

Our Legislature also has expressly recognized the necessity for restrictions upon the use, occupancy and transfer of condominium units. Fla.Stat. § 711.08(2) (1973).

It is our opinion that appellant's leasing restriction constitutes neither an unlimited...