View Condominium Owners Ass'n v. Msico

• Decision Date: 30 December 2005
• Docket Number: No. 20040369.,20040369.
• Parties: The VIEW CONDOMINIUM OWNERS ASSOCIATION, a Utah condominium association, Plaintiff, Respondent, and Cross-Petitioner, v. MSICO, L.L.C., a Utah limited liability company; and the Town of Alta, a political subdivision of the State of Utah, Defendants, Petitioners, and Cross-Respondents.
• Court: Utah Supreme Court

127 P.3d 697

2005 UT 91

The VIEW CONDOMINIUM OWNERS ASSOCIATION, a Utah condominium association, Plaintiff, Respondent, and Cross-Petitioner, v. MSICO, L.L.C., a Utah limited liability company; and the Town of Alta, a political subdivision of the State of Utah, Defendants, Petitioners, and Cross-Respondents.

No. 20040369.

Supreme Court of Utah.

December 30, 2005.

COPYRIGHT MATERIAL OMITTED

Robert E. Mansfield, Stephen Christiansen, Salt Lake City, for plaintiff.

Merrill F. Nelson, Salt Lake City, for defendants.

On Certiorari to the Utah Court of Appeals

PARRISH, Justice:

¶ 1 The View Condominium Owners Association ("The View") sued the Town of Alta and MSICO, L.L.C. ("MSI"), seeking to prevent construction of single family homes on lots 5 and 9 of the Sugarplum Planned Unit Development ("Sugarplum"), both of which are owned by MSI and located in Alta. With respect to lot 5, The View argued that restrictive covenants governing Sugarplum designated lot 5 as a parking area and that a subsequent amendment to the Sugarplum plat map did not alter that designation. With respect to lot 9, The View argued that Alta effectuated an unconstitutional taking of its property without just compensation when it amended a plan designating lot 9 for snow storage. The district court entered summary judgment against The View on both issues. The court of appeals affirmed the summary judgment on the parking issue, but concluded that disputed issues of material fact precluded summary judgment on the snow storage issue. The parties cross-petitioned this court for writs of certiorari, which we granted. We hold that the restrictive covenants were not abrogated by the recording of the amended plat and accordingly reverse the court of appeals' ruling on the parking issue. We similarly reverse the court of appeals' ruling on the snow storage issue, concluding that The View cannot establish the elements necessary to succeed on its claim of regulatory taking.

FACTUAL BACKGROUND

¶ 2 The Sugarplum Planned Unit Development comprises approximately twenty-five acres in Alta, Utah. On August 12, 1983, Sorenson Resources Company ("Sorenson"), the developer of Sugarplum, simultaneously recorded two documents with the Salt Lake County Recorder. The first was a Master Declaration of Covenants, Conditions and Restrictions (the "Declaration") governing Sugarplum. The second was a plat map ("original plat") defining the location and dimensions of the individual Sugarplum lots and specifying their anticipated dwelling densities.

¶ 3 As originally envisioned, Sugarplum was divided into nine individual lots with common areas for roads and other shared uses. Under the Declaration, a planned road running roughly north and south provided access to lots 4 through 9. Lot 4 abutted the road's eastern edge, while lot 5 abutted the road's western edge. Lots 8 and 9 were also located west of the road, but they were offset so that access to them was available only by passing through lot 5.

¶ 4 The Declaration designated lot 5 as a parking area for the benefit of the units to be constructed on lot 4 and on lots 6 through 9. Sorenson retained the airspace rights above lot 5, to be developed as it saw fit; potential uses included "commercial, retail, residential, recreational."

¶ 5 The original plat also anticipated the use of lot 5 for parking. It contained a table entitled "Anticipated Dwelling Density," which listed the estimated number of residential units to be constructed on each of the nine lots. All lots, except lot 5, were assigned a tentative number of units. Lot 5 was assigned no units. Rather, the entry for lot 5 stated "Parking and Commercial Development of Air Space."

¶ 6 Before selling any of the lots, Sorenson recorded an amended plat map, which significantly altered the configuration, size, and spatial relationships of the nine lots. The amended plat moved lot 5 across the street so that it occupied land that previously had been part of lot 4. Lots 8 and 9 were shifted toward the road into the space previously occupied by lot 5 so that these two lots then abutted the planned road.

¶ 7 The amended plat also included changes to the table. The designation of lot 5 for "Parking and Commercial Development of Airspace" found on the original plat was eliminated, and lots 4 and 5 were listed together, with sixty-five units allocated between them. Sorenson, however, failed to make corresponding amendments to the Declaration, which designated lot 5 for parking and the development of airspace.

¶ 8 On January 4, 1985, The View's predecessor in interest purchased lot 8 as described in the amended plat. Despite the restrictive covenants contained in the Declaration, the parties did not contemplate a parking right on lot 5. Walter Plumb, Sorenson's corporate secretary, testified that the amended plat reflected plans to eliminate lot 5 as a parking structure and that Sorenson never intended to convey a parking right in that lot. Russell Watts, president of The View's predecessor in interest, who was directly involved in the purchase of lot 8 from Sorenson, testified that he neither bargained for nor intended to acquire a parking interest in lot 5.

¶ 9 After acquiring lot 8, The View's predecessor in interest sought a building permit from Alta. Because of the heavy annual snowfall in the Alta area, Alta required an acceptable plan for storing the snow on lot 8 as a condition of the permit. To facilitate the application process, Plumb wrote a letter to Alta dated February 27, 1985, in which he sought to clarify Sorenson's intent with regard to snow storage at Sugarplum. The letter stated that, during the development of lots 6 and 8, snow would be stored in the appropriate designated areas and that if there should "be any excess snow, it may be stored on lot 9 as recorded." It also stated that areas designated for snow storage were subject to change and that any such changes would be submitted to Alta for approval when Sorenson applied for additional development in Sugarplum.

¶ 10 The Alta Planning Commission approved The View's application for a building permit on lot 8, contingent on its understanding that substantial snow storage had been planned for lot 9. On April 27, 1985, on the basis of the Commission's recommendation, Alta approved an official snow removal plan for The View that designated lot 9 for overflow snow storage, and The View began using lot 9 for that purpose.

¶ 11 On December 31, 1988, Sorenson deeded lots 4, 5, and 9 to MSI. Thereafter, various disputes arose between MSI and Alta regarding development of the three lots, culminating in MSI's filing a lawsuit against Alta in September 1996. One of the disputes related to Alta's refusal to allow MSI to develop lot 9 while that lot was designated as a snow storage area for use by The View. As part of that dispute, Alta sent The View a letter indicating that, if The View were to lose its ability to store snow on lot 9, Alta "would have little choice but to take legal action to protect the public safety and welfare," as "[s]now storage is a life-safety issue in Alta." The letter stated that "protect[ing] the public safety and welfare" would necessitate "an injunction precluding the occupancy of The View of lot 8 or portions thereof during snow periods."

¶ 12 MSI and Alta settled the suit in November 2000. As part of the settlement, Alta approved an alternate snow storage plan for lots 4, 5, 8, and 9. The alternate plan removed lot 9 as the designated location for snow storage for The View and allowed snow from lots 4, 5, 8, and 9 to be stored on five separate locations in and around Sugarplum. Under the settlement agreement, Alta also approved a development plan authorizing construction of ten single family homes on lots 4, 5, and 9.

¶ 13 In December 2000, The View sued MSI and Alta seeking to prevent construction on lots 5 and 9. The View sought to prevent construction on lot 9 under various legal theories, all of which were designed to establish that The View had a permanent right to store snow on that lot. Specifically, it argued that MSI and Alta breached a contract allowing it to use lot 9 as overflow snow storage and that MSI and Alta also breached the implied covenant of good faith and fair dealing that inhered in the contract. The View alternatively argued it had an easement to store snow on lot 9 and that the doctrine of estoppel prevented MSI and Alta from denying its right to store snow there. Finally, The View claimed that Alta's adoption of the revised snow storage plan constituted an unconstitutional taking of its property without just compensation.¹

¶ 14 Following discovery, The View, MSI, and Alta all moved for summary judgment. The district court denied The View's motion for summary judgment on the parking and the snow removal issues and granted MSI/Alta's motion for summary judgment on both issues.

¶ 15 The court of appeals affirmed the district court's entry of summary judgment against The View with respect to its claim for parking on lot 5 and its contractual claims to store snow on lot 9. The View Condo. Owners Ass'n v. MSICO, L.L.C., 2004 UT App 104, ¶ 38, 90 P.3d 1042. But it reversed the summary judgment entered against The View on its other claims relating to the snow storage issue. Id. Specifically, it found that disputed issues of material fact made summary judgment inappropriate on The View's claims of implied easement, estoppel, and taking without just compensation and remanded those claims to the district court for further proceedings. Id.

¶ 16 MSI and Alta jointly petitioned for a writ of certiorari, arguing that the court of appeals erred in denying summary judgment in its favor on The View's claims of implied easement, estoppel, and a constitutional taking. The View cross-petitioned, alleging that the court of appeals erred in affirming summary judgment in favor of MSI on its claim to a parking right on lot 5. We granted certiorari to consider...