South Creek Associates v. Bixby & Associates, Inc.

• Decision Date: 23 October 1989
• Docket Number: No. 88SC62,88SC62
• Parties: SOUTH CREEK ASSOCIATES, a Colorado general partnership, Petitioner, v. BIXBY & ASSOCIATES, INC., a Colorado corporation, d/b/a Bixby Day School, Respondent.
• Court: Colorado Supreme Court

Page 1027

781 P.2d 1027

SOUTH CREEK ASSOCIATES, a Colorado general partnership, Petitioner, v. BIXBY & ASSOCIATES, INC., a Colorado corporation, d/b/a Bixby Day School, Respondent.

No. 88SC62.

Supreme Court of Colorado En Banc.

Oct. 23, 1989.

Berenbaum & Weinshienk, P.C., Barry M. Permut, James L. Kurtz-Phelan and Amy Therese Loper, Denver, for petitioner.

Martin & Mehaffy, Joel C. Maguire, Boulder, for respondent.

Office of the Boulder City Atty., Joseph N. de Raismes and Jane W. Greenfield, Boulder, for amicus curiae City of Boulder in support of Bixby Day School.

Justice LOHR delivered the Opinion of the Court.

South Creek Associates (South Creek), a general partnership which owns a shopping center in Boulder, Colorado, filed a quiet title action in Boulder County District Court seeking a judgment that Bixby & Associates, Inc. (Bixby), an adjoining landowner which is the operator of a private day school, has no right to use South Creek's parking lot. Bixby claims a right to use the parking lot based on the provisions of a planned unit development (PUD) application submitted by McStain Enterprises, Inc. (McStain), the original owner and developer of both parcels involved in the present dispute, and approved by the City of Boulder planning board. South Creek and Bixby filed cross-motions for summary judgment. The district court granted Bixby's motion, denied South Creek's motion, and held that Bixby is entitled to use the South Creek parking lot based on the provisions of the approved PUD plan. South Creek appealed, ¹ and a divided panel of the Colorado Court of Appeals affirmed the district court's judgment. South Creek Assoc. v. Bixby & Assoc., Inc., 753 P.2d 785 (Colo.App.1987). We granted certiorari, and we now affirm the judgment of the court of appeals.

I.

In 1977, McStain filed an application ² with the City of Boulder planning department to develop land owned by McStain as a planned unit development to be called South Creek Village. The PUD plan proposed the development of a residential area, a shopping center, and a private school for South Creek Village. The plan was submitted pursuant to Boulder's planned unit development ordinance. Boulder Municipal Code §§ 37-501 to 37-513 (1965). ³

The South Creek Village PUD plan contained two statements regarding the use of the parking facilities presently at issue. In the "Guidelines for School Site," the plan stated that "[s]ix [parking] spaces will be provided on site for the exclusive use of school personnel. In addition, the adjacent parking lot will be available for the mutual use of the school and the commercial facility." Next, in the "Guidelines for Neighborhood Center," the plan provided that "[t]he parking on the southeast portion of the site is intended for the mutual use of the school and the shopping center tenants."

The City of Boulder planning board approved McStain's South Creek Village PUD application in December 1977. ⁴ This approval was subject to seven conditions regarding such items as landscaping, open space, bus service, road completion, recording appropriate covenants prior to subdivision, and submitting a list of proposed tenants for review and approval. None of the seven conditions addressed the parking provisions of the plan. Although the PUD plan was a matter of public record available from the City of Boulder, the plan was never recorded in the county clerk and recorder's office. See § 38-35-109(1), 16A C.R.S. (1988 Supp.) (any deed or other written instrument affecting title to real property may be recorded in county clerk and recorder's office in the county where the property is located).

In April 1978, McStain entered into a subdivision agreement with the City of Boulder allowing for the subdivision of South Creek Village. This subdivision agreement was recorded in the county clerk and recorder's office, and it stated that "development of this subdivision is controlled by an approved Planned Unit Development (P77-5) approved by the Planning Board with conditions on December 1, 1977, in addition to the City Land Use and Zoning Regulations." The agreement also provided that McStain "promises to meet and complete all conditions as stated on the P.U.D." and that "[a]ll improvements shall be completed in accordance with the plans as approved." Nothing in this recorded subdivision agreement specifically referred to the parking provisions of the PUD plan. Pursuant to Boulder's subdivision regulations, a subdivision plat was presented to and approved by the Boulder city council. The plan showed numerous easements, but it contained no reference to any use of the South Creek parking facility in connection with the operation of the private school. The plat was recorded in the office of the county clerk and recorder.

Following the PUD approval in 1977, McStain constructed the private school proposed in the plan. In the summer of 1978, McStain conveyed the school property to Bixby. ⁵ The deed granted Bixby a non-exclusive easement for ingress and egress over other South Creek Village property in order to provide access to and from the school, but it did not grant any easement for parking in the South Creek lot, nor did it mention any parking rights or privileges of Bixby under the PUD plan. This deed was recorded in the Boulder County clerk and recorder's office. Bixby commenced operation of the Bixby Day School on the deeded property in 1978.

In the meantime, McStain completed construction of the South Creek Village Shopping Center commercial facilities provided for in the PUD. After completion, McStain conveyed title to the South Creek Village Shopping Center to The South Creek Venture Company, a limited partnership in which certain former principals in McStain were general partners. In May 1982, the limited partnership conveyed the South Creek Village Shopping Center to the petitioner, South Creek, by a warranty deed that was recorded in the Boulder County clerk and recorder's office. The deed conveyed the shopping center property subject to several easements and encumbrances listed in an exhibit attached to the deed. Among the encumbrances listed was the recorded subdivision agreement between McStain and the City of Boulder. However, there was no reference in the deed or the attached exhibit to the approved PUD plan or to Bixby's right or privilege to the nonexclusive use of the South Creek parking lot.

Between 1978 and 1983, Bixby's employees and the parents of children attending the Bixby Day School used the South Creek parking lot at issue in this case. In the fall of 1983, however, South Creek began objecting to the use of the parking lot by individuals from the school. In 1984, South Creek filed the present quiet title action in Boulder County District Court alleging that the Bixby Day School had no right to use South Creek's parking lot. South Creek filed a motion for summary judgment. In support of its motion, South Creek averred that it had no actual knowledge of Bixby's asserted parking right on South Creek's parking lot at the time it acquired the shopping center. South Creek also contended that Colorado's recording statutes, §§ 38-35-108 to 38-35-109, 16A C.R.S. (1982), protected South Creek from any claim by Bixby to use South Creek's lot because there was no recorded instrument granting Bixby a right to use the lot. Thus, South Creek argued, it had no constructive notice of the parking right claimed by Bixby. South Creek further argued that the statements in the PUD plan were insufficient to create any rights in Bixby to use the lot because the plan was merely a guideline without any legal effect.

Bixby filed a cross-motion for summary judgment. In support of its motion, Bixby argued that the PUD plan provided for Bixby's use of the South Creek lot and that South Creek was bound by these plan provisions. Bixby also argued that South Creek was put on notice of the parking provisions of the plan because South Creek's deed referred to the recorded subdivision agreement between McStain and the City of Boulder which in turn referred to the approved PUD plan controlling the development of South Creek Village.

The district court ruled that summary judgment was appropriate because there were no genuine issues of material fact. The district court held that approval of a PUD constitutes rezoning of the area within the PUD and that subsequent uses of the area must be in accordance with the provisions of the PUD plan. Additionally, the district court concluded that South Creek had constructive notice of the PUD plan because a purchaser is deemed to have knowledge of the provisions of a PUD just as he is deemed to have knowledge of applicable zoning laws. Finally, the court held that South Creek also had notice of the unrecorded PUD provisions because the recorded subdivision agreement referenced in South Creek's deed referred to the PUD plan. Accordingly, the district court granted Bixby's motion for summary judgment and denied South Creek's motion for summary judgment on the claim at issue here.

South Creek appealed, and the Colorado Court of Appeals affirmed the district court's judgment. South Creek Assoc. v. Bixby & Assoc., Inc., 753 P.2d 785 (Colo.App.1987). The court of appeals relied on reasoning similar to that applied by the district court. First, the court of appeals held that the reference to the subdivision agreement in South Creek's recorded deed, and the further reference to the PUD in the subdivision agreement, were sufficient to put South Creek on notice of the PUD. "[O]nce having been put on notice, it was incumbent upon [South Creek] to peruse the provisions of the P.U.D. which contained the[ ] parking restrictions." 753 P.2d at 787. Secondly, the court of appeals held that the approved PUD plan was in effect a rezoning of the area restricting the use of the land to the provisions of the plan. Id. Thus, the court of appeals concluded, Bixby was entitled to enforce the parking provisions of...