Well-Built Homes, Inc. v. Shuster

• Decision Date: 29 September 2005
• Docket Number: No. 04-P-639.,04-P-639.
• Citation: 64 Mass. App. Ct. 619,834 N.E.2d 1213
• Parties: WELL-BUILT HOMES, INC. v. Richard SHUSTER.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

834 N.E.2d 1213

64 Mass. App. Ct. 619

WELL-BUILT HOMES, INC. v. Richard SHUSTER.

No. 04-P-639.

Appeals Court of Massachusetts, Suffolk.

Argued February 25, 2005.

Decided September 29, 2005.

COPYRIGHT MATERIAL OMITTED

Eric Wodlinger, Boston, for the plaintiff.

Diane C. Tillotson, Boston, for the defendant.

Present: DUFFLY, KAPLAN, & DREBEN, JJ.

DUFFLY, J.

By a partial summary judgment of the Land Court, various aesthetic and architectural restrictions and a prohibition against further subdivision of lots in a residential development were held not to apply to two lots owned by the defendant Richard Shuster.¹ We reverse the portion of the judgment that declared that a covenant to permit the imposition of future restrictions does not run with the land. As to the declaration that Richard's lots are not subject to the restriction against further subdivision, we vacate that judgment and remand for further proceedings.

1. Facts. The undisputed facts, as set forth in the memorandum and decision of the Land Court and as augmented by the undisputed portions of the record, are as follows.

In 1988, Richard Shuster and his then wife, Barbara Shuster, proposed a subdivision plan for a parcel of land they jointly owned in the town of Dartmouth creating twenty numbered lots plus one, Parcel A, designated by them as unbuildable, called the Liberty Tree Subdivision. With a single exception, the lots ranged in size from 32,259 to 82,791 square feet. The single exception, Lot 20, was 227,091 square feet. The Liberty Tree plan was approved by the Dartmouth planning board in 1988 and recorded in the registry of deeds. The Shusters retained adjacent land that was not part of the subdivision.

In the same year, Barbara commenced proceedings seeking a divorce from Richard. The judgment of divorce nisi, which became absolute on December 24, 1990, incorporated a separation agreement² of the parties calling for the transfer to Richard of adjoining Lots 5 and 20. Lot 20 included the marital residence.³ The agreement assigned the remaining lots and some additional real estate to Barbara.

In their agreement, the Shusters agreed to convey to Richard, along with the Lots 5 and 20, easements to use a street shown on the subdivision plan as Liberty Tree Drive and to provide access, sewer service, and utilities to "the parcels" conveyed. The agreement also reflected the Shusters' understanding "that there will be restrictions and obligations imposed upon all the buildable lots in the . . . Liberty Tree subdivision which have yet to be prepared." To ensure that Richard's lots would continue to be included in the subdivision for such purposes, the Shusters' agreement stated that Richard would either "(a) take title of Lots 5 and 20 subject to any and all obligations and restrictions as are imposed upon all of the buildable lots in the subdivision, or" — if such conditions were not yet imposed at the time he took title — "(b) execute any and all documents reasonably required to subject said Lots 5 and 20 to those restrictions in the event that they are imposed on the balance of the buildable lots . . . subsequent to [that time]."

The agreement stated that the imposition of any restrictive covenants on Lots 5 and 20 was contingent upon two conditions: first, that the restrictions would be "consistently applied in a non-discriminatory manner to all of the buildable lots in the subdivision"; and second, "that the restrictions and obligations that will be imposed on the Liberty Tree Subdivision shall apply to Lot 20 only to the extent that new structures are added to the property or existing structures are rebuilt or expanded." The separation agreement provisions relating to the transfer of their real estate and notice of the divorce judgment were recorded by Richard in March, 1993.⁴

The record on appeal reflects nothing further until January 11, 1999, when Barbara entered into a purchase and sale agreement with a developer, Well-Built Homes, Inc. (Well-Built), for the transfer of her lots in the Liberty Tree development, that is, all lots save 5 and 20. Barbara was to deliver a deed in consideration of $701,003 within thirty days after she secured the necessary approvals for changes Well-Built sought in the subdivision plan, namely a reconfiguration of the tract reducing the number of buildable lots and thereby creating some lots larger than those in the original subdivision plan.

Over the next several months, Barbara, at the behest of Well-Built, instituted such amendments. In April, 1999, the planning board approved a revised Liberty Tree plan, which encompassed the land to be conveyed to Well-Built by Barbara. The revised plan did not include Liberty Tree plan Lots 5 and 20. Shortly thereafter, Barbara renamed the subdivision "The Woods at Padanaram Village" (Woods plan). The resulting definitive subdivision plan now contained fifteen numbered buildable lots, plus Parcel A, still designated as unbuildable. The layout of these lots was based upon the 1988 Liberty Tree plan but was divergent in several respects: in particular, two of the buildable lots, Lots 7 and 11, now exceeded 140,000 square feet. The Planning Board endorsed the Woods plan in August, 1999.

Also in August, 1999 — nine years after the Shusters' divorce and six years after Richard recorded the divorce judgment — the Shusters as joint owners executed two deeds. The first deed conveyed to Richard Lots 5 and 20 of the original Liberty Tree plan, in terms similar to the provisions of the separation agreement. The second deed conveyed to Barbara the remaining lots shown on the 1988 plan as well as some additional land they owned.

Both deeds, which refer only to the 1988 Liberty Tree plan, were recorded on August 9, 1999, the date the Woods plan was finally endorsed by the planning board.⁵ On September 1, 1999, Barbara conveyed her land — encompassing the tract shown on the Woods plan, plus some additional territory — to Well-Built.

Well-Built, as developer of the Woods plan, executed a declaration of covenants and restrictions (declaration) on August 1, 2000, subjecting itself and its successors to conditions designed "to provide for an attractive, aesthetically compatible development." This declaration contained a restriction that is primarily at issue in this appeal.⁶ The restriction bars further subdivision of any lot without prior written approval from Well-Built. In addition to enumerating the restrictions, and reserving Well-Built's right to amend them, the declaration states that the restrictions are limited to the Woods plan; that Well-Built and its successors and other Woods lot owners may enforce the restrictions; and that the restrictions expire in thirty years unless extended by majority vote of the lot owners. The declaration concludes that the purpose of these restrictions is to protect the investment of Woods owners and to create architectural harmony.⁷

On August 7, 2000, Well-Built filed an approval not required (ANR) plan making further changes to the Woods plan, namely the incorporation of a small plot of adjacent land purchased from one David DeMello and the redivision of Lots 9 through 12 adjoining that land.⁸ Two buildable lots were added in this process, one of them from the conversion of Parcel A to Lot 10B. The final Woods plan contains a different configuration than the original Liberty Tree plan. The revised Woods plan does not include Richard's Lots 5 and 20 and it encompasses property (the DeMello parcel) not part of the Liberty Tree plan. Both the declaration and the ANR plan were recorded on August 8, 2000.

In May, 2001, Richard submitted an ANR plan, later recorded, for division of adjoining Liberty Tree plan Lots 5 and 20 into multiple lots. Lot 5, with the incorporation of some land from Lot 20, would be divided into Lot 16, measuring 25,523 square feet, and Lot 16A at 20,019 square feet. Lot 20 would be divided into Lot 20, containing the pre-existing house and measuring 142,159 square feet; Lot 20A at 33,215 square feet; and Lot 20B at 40,514 square feet.⁹ Lot 20B was to contain a tennis court and was designated as an unbuildable lot that could only be conveyed with one of the other lots. Richard then entered into an agreement to convey the new Lot 20, with the house, to one Marvin Harris for $1,011,200.

In preparation for closing, the buyer's attorney raised the issue whether the restrictions recorded by Well-Built applied to the parcel to be sold to Harris. Richard asked Well-Built to sign a release.¹⁰ In response, Well-Built executed and recorded a clarification of covenants and Restrictions, containing the assertion that Liberty Tree plan Lots 5 and 20 were bound by the restrictions set forth in the declaration. Thereafter, at the advice of a title insurer, Richard obtained from Barbara a release from the provisions of the deeds allowing the imposition of common restrictions on his land; he signed a similar release in favor of Barbara.

2. Prior proceedings. Well-Built filed a complaint in the Land Court on October 25, 2001, alleging that Richard had violated the prohibition against further subdivision, and that the reconfigured lots derived from Lots 5 and 20 are "not in keeping with the general presentation and dress of the subdivision and are substantially smaller than the average size of lots." This, Well-Built claimed, "detracts from the subdivision and diminished the value of the other lots in the subdivision, all to the harm of [Well-Built]." Well-Built sought (1) a declaration that Richard's land is subject to the restrictions imposed on the Woods plan and that subdivision of Lots 5 and 20 violated the restriction against further subdivision; (2) a declaration that only one of the parcels carved from Lot 5 is entitled to use of the easements described in the deed to Richard; (3) an injunction preventing Richard from selling or conveying the subdivided lots; and (4) damages for the diminished value of the Woods...