Wagner v. Nolan
| Decision Date | 19 April 2022 |
| Docket Number | WD 84214 |
| Citation | 644 S.W.3d 568 |
| Parties | George R. WAGNER, et al., Appellants, v. Barry L. NOLAN, Respondent. |
| Court | Missouri Court of Appeals |
John H. Edmiston, Warrensburg, for Appellants.
Wainsworth Charles Anderson, for Respondent.
Division Four: Cynthia L. Martin, Chief Judge, Thomas N. Chapman, Judge and W. Douglas Thomson, Judge
W. DOUGLAS THOMSON, JUDGE
George and Lila Wagner (collectively, the "Wagners") appeal from the trial court's judgment granting Barry Nolan's ("Nolan") motion for relief from a prior judgment which enjoined him from operating his tow business from his residential property pursuant to his subdivision's restrictive covenants. On appeal, the Wagners claim the trial court's finding that a majority of the tracts in the subdivision filed an instrument terminating the restrictive covenants was against the weight of the evidence in that the termination instrument was not signed by a majority of the lot owners. We reverse.
The Wagners and Nolan reside in Peaceful Valley Subdivision (the "Subdivision") in Kingsville, Missouri, which was created for single-family residential development. The Wagners are the owners of Lot 11 and Nolan is the owner of Lot 7 in the Subdivision. The lots of the Subdivision are subject to the "Restrictive Covenants on Peaceful Valley, a platted subdivision in Johnson County, Missouri" (the "Restrictive Covenants") executed on February 15, 2000. The Restrictive Covenants, which are executed by the developer of the Subdivision, reference that the exact legal description is attached and incorporated and that the plat of the Subdivision is duly recorded. The Restrictive Covenants enforce the Subdivision's residential scheme and road maintenance agreement. The Restrictive Covenants state they apply to all of the tracts of land in the Subdivision. The legal description provides it is also known as "Lots 1 through 14 , Peaceful Valley, a subdivision in Johnson County, Missouri.1 (Emphasis added).
The Restrictive Covenants provide that they "run with the land and shall be binding upon all properties and all persons claiming under them for a period of ten (10) years ... at which time [they] shall be automatically extended for successive periods of ten (10) years unless the then owners of a majority of the tracts in the said subdivision shall, before the expiration of said original term, or any extension thereof, by an instrument executed, acknowledged and recorded ... change or modify the same in whole or in part[.]" (Emphasis added).
In 2008, the developers replatted Lot 2 into four, separate lots, known as Lot 2, 2A, 2B, and 2C. The replat of Lot 2 was recorded in Cass County. At that time, nothing in the Restrictive Covenants addressed the effects of a lot replat. No modification was made to the Restrictive Covenants thereafter to address the effect a replat would have on the voting rights. Nor was any document created which evidenced that, as a result of the Lot 2 replat, there were now 17 rather than 14 lots subject to the Restrictive Covenants.
In 2016, the Wagners filed a petition for injunctive relief against Nolan in which they claimed Nolan was in violation of the Restrictive Covenants by operating a tow service from his residence and routinely keeping unlicensed vehicles on his property. After a hearing, the trial court entered a judgment granting injunctive relief ("Injunction Judgment") finding Nolan's conduct in violation of the Restrictive Covenants. The trial court permanently enjoined Nolan from any such further conduct. In March 2018, the Injunction Judgment was affirmed on appeal by this Court, at Wagner v. Nolan , 545 S.W.3d 373 (Mo. App. W.D. 2018).
In March 2019, Nolan filed a motion for relief under Rule 74.06(b)2 from the Injunction Judgment. In his motion, Nolan claimed the Restrictive Covenants were applicable for ten years after which time the covenant automatically extended for successive periods of ten years unless the owners of a majority of the tracts in the Subdivision execute an instrument changing or modifying the restrictions. Nolan asserted that on July 31, 2018, the owners of a majority of tracts in the Subdivision filed a "Termination and Release of Restrictive Covenant," whereby said property owners terminated, released and discharged the restrictive covenants in their entirety ("Termination Instrument"). Nolan asserted that 9 of the 17 lot owners voted to terminate the Restrictive Covenants, by executing the Termination Agreement. In determining that there were 17 lot owners entitled to vote, Nolan added to the 14 original lots the 3 additional lots created by the Lot 2 subplat. Notably, all four of the lots created by the Lot 2 subplat voted to terminate the Restrictive Covenants.
Nolan argued that the Injunction Judgment should be set aside as it is no longer equitable for it to remain in force as it permanently enjoined him from activities that were no longer in violation of the Restrictive Covenants.3 After a hearing, the trial court entered its judgment relieving Nolan from the Injunction Judgment because it "is no longer equitable as a result of the termination of the covenant by a majority of tract owners." The trial court ordered that Nolan is permanently allowed to conduct a tow service from his property, and to keep any unlicensed motor vehicles on his property.
The Wagners appeal.
"This judge-tried case will be reviewed under the standards set forth in Murphy v. Carron , 536 S.W.2d 30 (Mo. banc 1976)." Moore v. Weeks , 85 S.W.3d 709, 715 (Mo. App. W.D. 2002). "We must affirm the trial court's judgment unless it is not supported by substantial evidence, is against the weight of the evidence, or erroneously declares or applies the law." Id. at 715-16. "Because of the trial court's superior ability to determine the credibility of witnesses, we must defer to the trial court's findings of fact." Id. at 716. "We view the evidence and all reasonable inferences therefrom in the light most favorable to the trial court's judgment, while disregarding all contrary evidence and inferences." Id. " ‘It is the appellant's burden on appeal to demonstrate that the trial court's judgment was incorrect on any basis supported by the record and the applicable law.’ " Frye v. Monarch Title of N. Mo. , 565 S.W.3d 693, 698 (Mo. App. W.D. 2018) (citation omitted).
On appeal, the Wagners claim the trial court erred in finding the Restrictive Covenants had been terminated because the trial court's finding that a majority of the tract owners terminated the Restrictive Covenant was against the weight of the evidence in that the Termination Instrument was not signed by a majority of the lot owners of the Subdivision. In particular, the Wagners claim (a) only six owners of the fourteen lots in the Subdivision signed the Termination Instrument, and (b) the signature for Lot 2 is not properly acknowledged in the Termination Instrument.
" ‘A restrictive covenant is a private contractual obligation generally governed by the same rules of construction applicable to any covenant or contract.’ " Woodglen Ests. Ass'n v. Dulaney , 359 S.W.3d 508, 513 (Mo. App. W.D. 2012) (citation omitted). " ‘When interpreting [restrictive] covenants, courts should give effect to the intent of the parties as expressed in the plain language of the covenant[.]’ " Id. (citation omitted).
Here, the plain language of the Restrictive Covenants, including the attached and incorporated legal description, clearly define the 14 tracts which make up the Subdivision, and which may, in turn, vote on changes to the Restrictive Covenants. The legal description of the Subdivision indicates that there are 14 lots in the Subdivision, stating it is "also known as Lots 1 through 14 , Peaceful Valley, a subdivision in Johnson County, Missouri." Moreover, Paragraph 10 of the Restrictive Covenants directs how the covenants may be modified, stating in pertinent part:
These restrictions, reservations and covenants shall run with the land and shall be binding upon all properties and all persons claiming under them for a period of ten (10) years from the date this instrument if filed for record in the Recorder's Office for Johnson County, Missouri, at which time said covenants shall be automatically extended for successive periods of ten (10) years unless the...
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