September 2021
In This Issue:
Recent Cases in Community Association Law
Lot Owners Can Enforce Restrictive Covenants Against One Another
Board Had Broad Authority to Levy Fees Against Owners Who Rented Their Units
Association Cannot Enforce Short-Term Rental Restrictions Against Existing Owners
Aggressive Emotional Support Animal is Not a Reasonable Accommodation Under the FHA
Association Members Have Limited Expectation of Privacy in Election Ballots
Resident is Not Owed Preferred Accommodation for Disability
Association Had Power to Declare Aggressive Dog a Nuisance
Developer's Rights Were Not Forfeited Due to Inability to Exercise Them Without Association's Consent
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Recent Cases in Community Association Law

Law Reporter provides a brief review of key court decisions throughout the U.S. each month. These reviews give the reader an idea of the types of legal issues community associations face and how the courts rule on them. Case reviews are illustrations only and should not be applied to other situations. For further information, full court rulings can usually be found online by copying the case citation into your web browser. In addition, CAI’s College of Community Association Lawyers prepares a case law update annually. Case law summaries along with their references, case numbers, dates, and other data are available online.

Lot Owners Can Enforce Restrictive Covenants Against One Another

Abel v. Johnson, No. SC 20436 (Conn. Aug 20, 2021)

Use Restrictions: The Supreme Court of Connecticut found that deed restrictions in conjunction with a declaration established a common development scheme that could be enforced by subdivision owners against each other.

Michael and Carol Abel (the Abels) owned property adjacent to Celeste Johnson (Johnson) in the Saw Mill neighborhood in Stamford, Conn. In 1956, the original property owners (original owner) of approximately 167 acres conveyed the property to a developer to build the subdivision. The deed to the developer included restrictive covenants (1956 restrictions) that the land shall be used for private residential purposes only, and no buildings shall be erected upon the property except single-family dwelling houses and appropriate outbuildings. The deed stated that the restrictions were to run with the land and be binding upon all future successors and assigns of the developer, to benefit lands of the original owner lying west of the property.

In 1961, the developer recorded a declaration of restrictions (declaration) with the stated intent to protect property values. The declaration set forth several restrictions typical for residential property, including prohibiting animals and poultry except for pets kept inside the dwelling at night and requiring that commercial vehicles be kept within a garage with closed doors. However, the 1961 declaration did not contain a provision restricting the property to residential use only. The deeds belonging to the Abels and Johnson stated that the properties were conveyed subject to the 1956 restrictions and the declaration.

Johnson conducted a landscaping business and maintained a chicken coop and chickens on her property. The Abels sued Johnson, arguing that she violated the 1956 restrictions and the declaration by operating a commercial business and maintaining chickens. They sought injunctive relief (requiring a party to take a certain action or refrain from action) to require Johnson to immediately cease the violations.

Johnson argued that the 1956 restrictions were for the benefit and protection of the adjoining land retained by the original owner and could be enforced only by the original owner. The trial court concluded that the properties were part of a common plan or scheme of development, which gave the Abels standing to enforce the 1956 restrictions against Johnson. The trial court also found that Johnson had violated the restrictive covenants and rendered judgment for the Abels, ordering Johnson to immediately cease and desist from violating the restrictive covenants.

Johnson appealed to the Connecticut Appellate Court (appeals court). The appeals court concluded that the 1956 restrictions were expressly intended to benefit the remaining land of the original owner. It found nothing in the deed either suggested that the 1956 restrictions were intended to benefit the subsequent owners in the Saw Mill neighborhood or that the original owner was dividing its property into building lots, thus imposing the restrictions upon the developer and its buyers as part of a general development scheme.

Finding that the Abels lacked standing to enforce the 1956 restrictions, the appeals court reversed the trial court's judgment. The Abels appealed to the Connecticut Supreme Court (supreme court).

The Abels argued that the lot deeds expressly stated that the conveyances were "subject to" the 1956 restrictions, which rendered the residential use restriction enforceable by the lot owners against each other. The supreme court found that the declaration's stated intent to protect property values strongly supported the Abels’ reading of the "subject to" language in the developer's deeds as establishing a general plan of development limited to residential use. The supreme court explained that "subject to" language in a deed is contextual and may be used either to create a restrictive covenant or to disclose the fact that land conveyed is already burdened by a restrictive covenant.

The fact that the language was used in conveyances that effectuated a new subdivision may justify the inference that the parties intended to create new restrictive covenants for the benefit of the other lot owners in the subdivision. In addition, the declaration restricted the use and keeping of commercial vehicles in a manner that is wholly inconsistent with commercial use of the property, which suggests that the developer intended to eliminate commercial activity while accommodating those property owners who might keep their commercial vehicles at home for purposes of convenience.

The supreme court did not agree with the appeals judgment that additional phrasing about benefiting the remaining land of the original owner rendered the covenant unenforceable by subdivision owners. The use of a comma to set off that clause grammatically indicated that the original owner's land to the west remained a separate and independent beneficiary. Nothing in that language suggested that the standing of the original owner, or its successors, operated to the exclusion of the developer and its successors, namely, owners like the Abels.

Accordingly, the appeals court's judgment was reversed, and the case was remanded with directions to affirm the trial court’s judgment.

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Board Had Broad Authority to Levy Fees Against Owners Who Rented Their Units

Bargnesi v. Pelican Condominium Counsel of Co-Owners Association, Inc., No. 13-19-00613-CV (Tex. Ct. App. Aug. 12, 2021)

Powers of the Association: The Court of Appeals of Texas affirmed that an association could charge an extra fee to unit owners who rented their units outside of an association-sponsored rental pool.

Pelican was a 64-unit condominium in Nueces County, Texas. Pelican Condominium Council of Co-Owners Association, Inc. (association) operated a rental pool program for unit owners who wanted to lease their units. Participating owners (rental-pool owners) executed an agreement permitting the association to market, schedule, and manage their leases in exchange for 40% of the rent collected. The owners that rented their units themselves (self-renters) were not part of the rental pool and, therefore, did not pay any rental fees to the association. Mary Lou Bargnesi (Bargnesi) was a self-renter.

In January 2016, rental-pool owners and nonrental owners expressed frustration that the self-renters did not contribute financially for the association's extra expense of their leasing activity even though they benefitted from the rental program activities (marketing, etc.). The members adopted a resolution to disallow future self-rentals, grandfather in the current self-renters, and impose a 20% fee on those renting outside the rental pool related to their rental income.

The association sued the self-renters, seeking a ruling that its resolution disallowing future self-rentals and imposing a rental-activity fee was enforceable. The self-renters counterclaimed for breach of contract, injunctive relief (requiring a party to take certain action or prohibiting action), and a determination that the resolution was arbitrary, capricious, and unenforceable.

The self-renters argued that the resolution was prohibited by the Texas Uniform Condominium Act (act) because there was no correlation between the 20% fee and any increased costs incurred by the association because of the self-renters' rentals. They also asserted that the resolution was decided on a whim, and it added restrictive covenants to the self-renters' use of their property contrary to the declaration of condominium (declaration). Also, any changes to the declaration required the written consent of all unit owners. The self-renters further complained that the association was improperly allocating certain fees on the self-renters instead of all unit owners in violation of the declaration, which required all unit owners to be charged their proportional share of the common expenses.

However, the unit owners overwhelmingly voted for the resolution at an annual meeting where every owner was allowed to speak. The trial court granted summary judgment (judgment without a trial based on undisputed facts) in favor of the association and ordered the self-renters to pay attorneys' fees. The self-renters appealed.

The declaration stated that all owners were obligated to contribute to the expenses of administration, upkeep, maintenance, and repair of the general common elements and any other charges assessed by the association pursuant to authority granted by the governing documents or the act. The declaration gave the association's board of directors (board) broad authority to exercise the powers necessary for the condominium's management and administration. The appeals court concluded that the association had the authority to levy fees against the self-renters renting outside the rental pool, assuming the prohibition and fees were reasonably necessary to achieve the purpose of creating a uniform plan for development and operation of the condominium project.

The self-renters argued that the fees were arbitrary, capricious, and discriminatory because they only applied to the self-renters, and there was no correlation between the fee and any cost incurred by the association. For the assessment of the fee or the later prohibition against the use of outside rental agents to be arbitrary, capricious, or discriminatory, there must be evidence that the board acted without a reason related to the sound governance of the entire condominium project. The self-renters did not provide such evidence. To the contrary, the association showed that the board "deliberated at length on the subject" as unit owners expressed frustration, and the association had incurred expenses for over 30 years that benefitted the self-renters without the self-renters sharing in such expenses. As such, the appeals court concluded that the 20% rental fee imposed against the self-renters was not arbitrary or discriminatory.

Accordingly, the trial court's judgment was affirmed.

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Association Cannot Enforce Short-Term Rental Restrictions Against Existing Owners

Brown v. Montage at Mission Hills, Inc., Nos. E074341, E075762 (Cal. Ct. App. Aug 20, 2021)

Use Restrictions: The Court of Appeal of California held that the Davis-Stirling Common Interest Development Act prohibited an association from enforcing a short-term rental restriction against an owner who purchased prior to the restriction's adoption.

Montage at Mission Hills Inc. (association) governed a common interest development in Cathedral City, Calif. Nancie Brown purchased a unit in the community in 2002 with the plan to use it as a rental property. At the time of her purchase, the declaration of conditions, covenants, and restrictions (declaration) did not prohibit any form of short-term leasing, aside from imposing recordkeeping requirements. Brown consistently rented her unit on a short-term (less than 30 days) basis.

In January 2018, the association amended the declaration to prohibit leasing units for periods of less than 30 days. After receiving notice of the new amendment, Brown sued the association, seeking a determination that she was exempt from the prohibition by the Davis-Stirling Common Interest Development Act (act). The act provides that an owner of property in a common interest development shall not be subject to a regulation that prohibits the rental or leasing of a unit unless that provision was effective prior to the date the owner acquired title to the unit.

The association argued that the act prevented associations from imposing complete bans on renting, but its prohibition on short-term rentals was only a restriction regulating the duration of the rental. The trial court ruled in the association's favor, finding that the rental restriction did not bar all rentals of Brown's unit. Brown appealed.

The association argued that Brown's short-term rentals were limited licenses to use the property, making her guests licensees and not tenants under the act. The appeals court did not agree, as courts have routinely used the term "rent" and its variants to refer to short-term occupancies. The association also contended that the short-term rentals effectively made Brown's operations more like a hotel in violation of the declaration's prohibition on commercial use of the property. The appeals court did not agree that the commercial use prohibition could be read to prohibit short-term rentals but not longer-term ones.

It was unclear what rental restrictions a common interest development might adopt and enforce retroactively after an owner's acquisition of the property, so the question was: When does a restriction become a prohibition? The appeals court found the act's language ambiguous as to whether it encompassed all limitations or restrictions on leasing or just complete bans on leasing.

The appeals court looked at the legislature's intent articulated by the legislative history. History indicated that the legislators intended broad protection for owners against restrictions on renting adopted after the owner's purchase to ensure that owners maintained all the rental rights they had at the time of purchase.

The appeals court interpreted the legislative history as demonstrating the goal to exempt owners from any kind of rental prohibition or restriction that did not exist when the owner acquired title to the property. The exemption must include at least the type of restriction where a category of short-term rentals was barred. Whether an association could enact a generally applicable limitation on occupants or impose certain generally applicable requirements that affected renting but did not directly prohibit the rental of the property itself was not addressed by the appeals court.

While the case was pending, the legislature amended the act to provide that an association may adopt and enforce a provision that prohibit rentals for less than 30-day periods, but it specifically exempted owners who acquired title to their units before the amendment's effective date. This showed a renewed desire to protect the short-term rental owners who took title before leasing restrictions were adopted.

Accordingly, the trial court's judgment was reversed.

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Aggressive Emotional Support Animal is Not a Reasonable Accommodation Under the FHA

Friedel v. Sun Communities, Inc., Park Place Community L.L.C., No. 20-12275 (11th Cir. Aug. 24, 2021)

Federal Law and Legislation: The U.S. Court of Appeals for the 11th Circuit held that a mobile home park was not obligated by the federal Fair Housing Act to permit an emotional support animal with a propensity for biting and aggression to remain in the community as an accommodation to a disabled resident.

George and Kathleen Friedel (the Friedels) lived in Park Place, a mobile home park in Tampa, Fla. Park Place Community, LLC (collectively, with its parent company, Sun Communities, Inc., Park Place) owned and operated the park. George Friedel suffered from several chronic physical and mental issues, including a major depressive disorder, and lived with an 11-year-old golden retriever named Maggie serving as his emotional support dog.

In January 2016, Maggie bit another dog living in the park. Maggie had previously presented aggressive behavior or injured other dogs. Park Place issued a notice of violation to the Friedels and informed them that the dog had to be removed from the community. The Park Place rules prohibited aggressive pets and required that any pet exhibiting dangerous or aggressive behavior, as determined in the sole discretion of Park Place, be removed from the park. The Friedels complied without informing Park Place of Mr. Friedel's disability or that Maggie was an emotional support animal assisting Mr. Friedel.

Mr. Friedel's depression immediately worsened, so the Friedels brought Maggie back in April. Until January 2017, Maggie lived in the park undetected until a neighbor saw her. Then, the Friedels informed Park Place of Mr. Friedel's disability and made a formal request for an accommodation to keep Maggie as an emotional support animal. Meanwhile, Park Place requested that the Friedels remove the dog again and alerted them that a failure to comply could result in eviction.

In February 2017, Park Place sent another notice requiring the Friedels to remove Maggie or face eviction. Four days later, the Friedels sued Park Place (first lawsuit) claiming that its refusal to accommodate Mr. Friedel's disability violated the federal Fair Housing Act (FHA). Park Place claimed that Mr. Friedel was lying about his disability and only visited a doctor for an alleged handicap after Maggie attacked other animals and was banned from the park.

The jury found that Park Place took action that made Mr. Friedel's home unavailable to him; that Mr. Friedel was disabled within the meaning of the FHA; that Park Place would not have taken adverse action against the Friedels if not for Maggie; and that Maggie alleviated the symptoms of Mr. Friedel's disability. However, the jury acknowledged that Maggie posed a direct threat to the health or safety of other individuals and no reasonable accommodation would have eliminated or acceptably minimized the risk Maggie posed to other residents.

In October 2017, the day after the trial was concluded, Park Place served the Friedels with a notice to vacate within 30 days. The Friedels filed another lawsuit against Park Place (second lawsuit). They alleged that as of October 2017, Maggie had received more than nine months of professional training and had not demonstrated any recent threatening conduct. The Friedels also claimed that Park Place discriminated against them in violation of the FHA by issuing the notice to vacate after they sent Park Place a new request for an accommodation outlining the behavior training Maggie had received. The trial court dismissed all of the Friedels' claims in the second lawsuit, and the Friedels appealed.

The appeals court was unpersuaded that Park Place discriminated against the Friedels by making a dwelling unavailable because of a handicap. To state a claim for discrimination because of a disability, a plaintiff must allege that the adverse action was taken because of a disability and state the facts on which the plaintiff relies on to support that claim. The allegations made by the Friedels in the second lawsuit directly contradicted their unsupported claim of discrimination. Park Place told the Friedels that the dog's assistance with Mr. Friedel's disability was irrelevant, which suggested that his disability had no effect on their decision. Rather, the most likely reason Park Place issued its notice of eviction was because, on the day prior, Park Place prevailed in the first lawsuit.

The Friedels failed to explain why having Maggie live on the property was a reasonable accommodation. The Park Place rules flatly barred aggressive dogs from the property, and the rules provided no exceptions that could make their accommodation reasonable. Park Place determined that the dog posed a risk to the community, and the Friedels did not promptly address that risk. Instead, they snuck Maggie back onto their property a few months after the January 2016 biting incident without any training and then waited before claiming that she had been trained. There was no indication that the Friedels asked Park Place about acceptable training programs beforehand or that they otherwise pursued other alternative accommodations.

The Friedels were not seeking a reasonable accommodation but simply their preferred accommodation, which is not required under the law. No provision within the Friedels' lease prohibited Park Place from requiring removal of an animal from the property after the animal had been determined to be a danger and threat to the community.

Accordingly, the trial court's judgement was affirmed.

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Association Members Have Limited Expectation of Privacy in Election Ballots

Rarity Bay Partners v. Rarity Bay Community Association, Inc., No. E2021-00166-COA-R10-CV (Tenn. Ct. App. Aug. 23, 2021)

Association Operations: The Court of Appeals of Tennessee held that the Tennessee Nonprofit Corporation Act's corporate records provisions required the production of election ballots to a member upon demand.

Rarity Bay Community Association, Inc. (association) governed the Rarity Bay community in Knoxville, Tenn. Rarity Bay Partners (RBP) owned a number lots in the subdivision.

An election of the board of directors was held in 2019. RBP suspected foul play in the election after one of its nominees lost by a narrow margin. RBP sued the association, seeking to compel the association to produce all records related to the election pursuant to the Tennessee Nonprofit Corporation Act (act). RBP argued that the identities of voters, number of votes cast by each voter, and the actual ballots were the only complete recordings of the members' action at the election.

The association refused to turn over the ballots, contending that there was a fundamental expectation of privacy in voting by ballot. The trial court granted RBP's request but issued a protective order prohibiting disclosure of how the members cast their votes except as necessary for litigation. The association appealed, arguing that the act did not require the production of election ballots, but rather only the list of members entitled to vote in the election and the number of votes they were entitled to cast.

The appeals court determined that the act's corporate records provisions provided for the disclosure of ballots in this case. The act requires a corporation to keep a copy of the minutes of all meetings of members and records of all actions approved by the members for the past three years. The act gives members the right to inspect and copy excerpts from any of those records. The appeals court stated that records of actions approved by the members necessarily included records of actions voted for by written ballot. It would be absurd to hold that, while the act required corporations to maintain records from its elections, these records did not include the ballots used in the election. 

The association argued that the Tennessee Constitution recognized the right to vote secretly in elections, and that was the backdrop against which the ballot provisions should be interpreted. RBP countered that neither the act nor the association's governing documents explicitly created privacy rights in voting at association elections. Nowhere was there any mention of secret ballots or secret voting.

The appeals court found that the state constitutional right to a secret vote only addressed state-sponsored elections and had no application to a private corporation's election of its board of directors. The appeals court also did not interpret the act as creating an absolute right of privacy in election ballots as election records were subject to inspection under certain circumstances. The act clearly demonstrated that, if necessary, votes can be inspected by multiple appointed people, from inside or outside of the corporation, to determine their validity, thus creating a limited privacy right.

The act specifically stated that, if a court ordered inspection of corporate records, it could impose reasonable restrictions on the use or distribution of the records by the member demanding access. The appeals court found nothing unreasonable about the trial court's protective order concerning use of the ballots.

The association advocated for at least redacting the ballots so that the identities of the voters and the candidates they voted for remained confidential. The appeals court stated that doing so would defeat the purpose of requiring production of the ballots. If a member could not examine who voted and how they voted, there was no way of validating the election’s results. The protective order adequately protected the limited privacy rights members had with respect to their votes. It allowed the ballots to be examined to determine the election's validity without unnecessarily disclosing information that may be considered sensitive.

Accordingly, the trial court's judgment was affirmed.

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Resident is Not Owed Preferred Accommodation for Disability

Spiegel v. The Illinois Human Rights Commission, No. 1-19-2303 (Ill. App. Ct. Aug. 12, 2021)

State and Local Legislation and Regulations: The Appellate Court of Illinois held that a condominium resident did not prove he was entitled to an accommodation under the Illinois Human Rights Act to leave a chair at the pool because there was no evidence that doing so would alleviate any disability-related symptoms.

1618 Sheridan Road Condominium Association (association) managed an eight-unit condominium complex in Illinois. Marshall Spiegel was a condominium resident with a physical disability related to his prostate, neck, and back. His doctors recommended that he use an orthopedic chair.

In May 2016, the association implemented a rule that unit owners could bring furniture, flotation devices, and similar items to the pool area but must remove them daily when they leave the pool area.

In August 2016, another resident complained to the association that Spiegel was leaving his chair by the pool overnight, and the association issued a citation to Spiegel. Spiegel asked for permission to leave his chair at the pool, but the association denied his request. Later, the association provisionally allowed Spiegel to leave his chair at the pool overnight but asked him to submit further information detailing the disability necessity, the weight, and confirmation from a doctor that it was indeed an orthopedic lounge chair to support his claim of needing to keep the chair there overnight.

Spiegel submitted three letters from doctors. One indicated the use of an appropriate chair to accommodate his disability was required, another was a recommendation that Spiegel use an orthopedic lounge chair, and the last stated that Spiegel's anti-gravity chair helped with his prostate condition. Spiegel's attorney also wrote a letter claiming that Spiegel's disability precluded him from removing the chair from the pool daily without risk of severe injury.

In October 2017, the association rescinded Spiegel's provisional accommodation because he had not provided the information requested. The doctors' letters were not independent third parties and did not clearly address Spiegel's need for a certain type of chair and any weight limitations. The association stated it would reconsider the matter.

In March 2018, Spiegel filed charges of housing discrimination and retaliation against the association with the Illinois Department of Human Rights (department) under the Illinois Human Rights Act (act). It is a civil rights violation under the act to refuse to make reasonable accommodations in rules, policies, practices, or services when such accommodations may be necessary to afford a person equal opportunity to use and enjoy a dwelling.

In June 2018, the association proposed a change to the pool's opening and closing dates that shortened the pool season by about a month. Spiegel believed that this change was proposed as retaliation for his filing a discrimination complaint, so he amended his charge to add a claim of retaliation. According to the association's president, the proposed rule was intended to save money, was never voted on, and did not go into effect.

The department found that there was a lack of substantial evidence supporting the accommodation claim because the association had allowed for a temporary accommodation and there was no evidence that leaving the chair at the pool overnight was necessary to alleviate symptoms of Spiegel's disability. The pool's opening and closing dates never changed, and the proposed change did not target Spiegel. The department also dismissed Spiegel's retaliation claim for lack of substantial evidence to support it. Spiegel appealed the decision to the Illinois Human Rights Commission (commission), which upheld the department's decision.

Spiegel appealed to the Appellate Court of Illinois (appeals court). Due to the similarity between the act and federal Fair Housing Act, Illinois looks to federal discrimination law for guidance in determining whether housing discrimination has occurred. For a violation of the act to have occurred, the evidence must show that the requested accommodation was reasonable and necessary to afford Spiegel equal opportunity to use and enjoy a dwelling.

Whether the requested accommodation is necessary requires showing that the desired accommodation will affirmatively enhance a disabled person's quality of life by improving the effects of the disability. The "equal opportunity" element limits the accommodation duty so that not every rule that creates a general inconvenience or expense to the disabled needs to be modified. Rather, the act requires only accommodations that ameliorate the effects of a person's disability so that he or she is not disadvantaged by reason of the disability.

No evidence showed that the symptoms of Spiegel's physical disability were improved by leaving the chair at the pool overnight. None of the doctors' letters confirmed that Spiegel's disability required that he leave his chair by the pool overnight to alleviate his disability symptoms so that he could use the pool area like any other pool user.

Spiegel argued that the association should have the burden of proving the propriety of its actions. The appeals court determined that a burden-shifting analysis was not necessary or appropriate for accommodation claims because they are about the reasonableness of an accommodation, not the motivations behind the disparate treatment of disabled and nondisabled individuals.

The appeals court found that Spiegel did not prove the requested accommodation was reasonable. Since the beginning, the association requested yet received no evidence connecting Spiegel's request to leave his chair at the pool to the symptoms of a disability.

Accordingly, the decisions of the commission and the department were affirmed.

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Association Had Power to Declare Aggressive Dog a Nuisance

Sunset Greens Homeowners Association v. Spagenski, No. D078201 (Cal. Ct. App. Aug. 13, 2021)

Powers of the Association: The California Court of Appeal held that an association had the power to determine that an aggressive dog was a nuisance and order its removal without proving the likelihood of future harm.

Douglas and Arden Spagenski and their son, John (collectively, the Spagenskis) lived in the Sunset Greens community in San Diego County, Calif. Sunset Greens Homeowners Association (association) governed the community in accordance with a declaration of covenants, conditions, and restrictions (declaration).

In August 2018, the Spagenskis brought their German shepherd Kato, then a puppy, into the community. In February 2019, Kato crossed paths with another resident and her dog, Missy, during a walk. Kato picked Missy up with his mouth and shook her, later biting Missy's owner during the chaos. The Humane Society put Kato in home quarantine after this incident.

The association sent the Spagenskis a violation notice and held an enforcement hearing. The Spagenskis were ordered to comply with the declaration going forward by ensuring Kato remained on a leash while in the common areas under the control of a capable person and directed to pay Missy's veterinary bills. The association's board of directors (board) also notified the Spagenskis that, should there be any further incidents, they would be asked to remove Kato from the community.

In May 2019, Kato attacked two other dogs, Holly and Gracie, and other neighbors who were walking by the home. Kato escaped through a window and rushed at the dogs. Again, Kato grabbed Gracie with his mouth and shook her violently. One of Gracie's owners kicked Kato. Kato then dropped Gracie and began to attack Holly. Gracie's other owner was knocked over by Kato and sustained injuries. The third resident tried to separate the two dogs, but Kato bit her hand. The Humane Society put Kato in home quarantine for another 10 days. Holly was treated for surface bites, and after receiving antibiotics, she made a full recovery. Gracie, however, underwent surgery for her more significant injuries, but died the day after the attack.

In June 2019, the association sent another violation notice and directed the Spagenskis to remove Kato from the community pending the hearing. The Spagenskis did not attend the hearing but received notice that the board deemed Kato a nuisance and was to be immediately and permanently removed from the community.

Kato may have been involved in a third attack that same month, though the exact date was debated. Kato aggressively ran towards another dog, Cora, bit her thigh, and shook her with his head. The Spagenskis did not dispute that Kato attacked Cora, but claimed it happened earlier in the year on a walking trail outside of the community.

In August 2019, the association filed suit, seeking injunctive relief (requiring a party to take a certain action or refrain from action) for breaching the declaration and nuisance clause. The trial court issued a temporary injunction barring Kato from being in the community while the lawsuit was pending.

The declaration prohibited any act that unreasonably threatened the health, safety, or welfare of other residents in the community. The declaration barred pets that have a reasonable likelihood of interfering with the rights of any resident's peaceful and quiet enjoyment of their property and forbade any pet from being in the common areas without a leash held by a person capable of controlling the animal. The declaration gave the board the power to determine whether an animal created an unreasonable annoyance or nuisance and to require the animal's removal after any such determination.

The trial court found that Kato was a nuisance, the Spagenskis breached the declaration by permitting the nuisance, and the association had the authority to abate the nuisance. The trial court granted summary judgment (judgment without a trial based on undisputed facts) in favor of the association and forbade Kato from living in the community. The Spagenskis appealed.

The Spagenskis contended that Kato had been provoked in the incidents, so there was a material factual dispute as to whether Kato was a nuisance. They also argued that the association had to show that Kato was a future threat before it could order Kato removed from the community. The Spagenskis asserted that the association could not conclusively prove that Kato was a future threat because he was undergoing aggression training.

The appeals court determined the question of whether Kato posed a threat of future harm after his training was not an issue of material fact with respect to the claim for breach of the declaration. Rather, the question was whether a violation had already occurred.

To establish a breach of the declaration, the association relied on evidence that Kato attacked other dogs three times, with at least two of the attacks occurring within the community. The evidence showed that Kato was the aggressor in the incidents, injured several dogs and humans, and killed one dog. These undisputed facts sufficiently showed that the Spagenskis, through Kato, interfered with other residents' peaceful and quiet enjoyment of the community. The declaration gave the association the authority to order Kato's removal for the past incidents without the necessity of proving the likelihood of future harm.

Accordingly, the trial court's judgment was affirmed.

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Developer's Rights Were Not Forfeited Due to Inability to Exercise Them Without Association's Consent

Trustees of the Beechwood Village Condominium Trust v. USAlliance Federal Credit Union, 100 Mass. App. Ct. 192 (Mass. App. Ct. Sept. 7, 2021)

Developmental Rights: The Appeals Court of Massachusetts determined that a developer's reserved condominium phasing rights still had value and were not extinguished, even though they could not practically be exercised without obtaining additional easements from the association.

In 2007, Beechwood Village Realty Trust (developer) recorded a condominium master deed (master deed) against a 37-acre parcel in Rockland, Mass., for the purpose of developing a condominium project. The developer financed the development through loans provided by USAlliance Federal Credit Union (USAlliance), and USAlliance held a mortgage on the property as security for the loans' repayment.

The master deed established the first three units, and the developer reserved the right to construct up to 79 additional units in 30 phases (phasing rights). A site plan depicting the 79 units was recorded with the master deed. Beechwood Village Condominium Trust (association) was established to govern the condominium.

Between 2007 and 2011, 54 units were constructed and added by amendment to the master deed. As each unit was sold, USAlliance issued partial releases releasing the unit from its mortgage. The project ran into severe financial difficulties by 2011, and the developer ceased operations. All the project roads were constructed, but the remaining planned units on scattered sites were never built.

In 2016, the association sued USAlliance, seeking a determination that the USAlliance mortgage no longer encumbered any interest in the condominium property or buildings; the developer's development and easement rights expired in March 2014; and the common area was not subject to any development without the consent of the unit owners. The trial court determined that the entire 37 acres remained subject to the mortgage, except to the extent USAlliance granted partial releases for particular units. It also held that the developer's construction rights had expired. Both parties appealed.

The master deed reserved easements for the developer associated with the phasing rights for seven years. It also granted other access easements to and from buildings for utilities for an unlimited time. In Trustees of the Beechwood Village Condominium Trust v. USAlliance Fed. Credit Union, 125 N.E. 3d 83 (Mass. App. Ct. 2019) (reported in the July 2019 issue of Law Reporter), the appeals court concluded that, although the phasing rights had not expired, the construction and access easements had expired. The utility easement rights that remained were insufficient to permit travel across the common area for purposes of constructing additional units.

The appeals court also determined that when USAlliance released units from the mortgage, it released the units' proportional interests in the common area. The common area consisted of the entire 37 acres, including the land underneath the units; only the buildings were excepted from the common area. Thus, USAlliance had released all the common area from the mortgage, but the mortgage continued to encumber the developer's reserved development rights.

On remand to the trial court, the association contended that the phasing rights had been extinguished or were otherwise invalid because they could not be exercised without construction and access easements. The trial court ruled that the phasing rights remained in force, and the association was not entitled to exercise the developer's rights. The trial court determined that the association and the developer, together, held all of the development rights necessary and reasoned that the two parties could "reach a deal" if they so chose. The association appealed again.

The association asserted that the phasing rights were in the nature of an easement, which could be extinguished by abandonment under easement law. USAlliance argued that the phasing rights were a different kind of property interest and not subject to extinguishment. The appeals court determined that the phasing rights had many attributes of an easement but also many differences. A distinguishing factor from an easement was that the reserved right allowed the developer to not only permanently add units to the condominium property but also to reduce each unit owner's percentage of ownership interest in the common area. These rights were not characteristic of a traditional easement. Moreover, the developer's reserved rights had a possessory component, as they allowed the developer to develop parts of the common area to be conveyed as new units.

The appeals court stated that the common law concept of extinguishing an easement may not apply to a developer's reserved rights. However, it did not have to proclaim such to be the law because, even if the phasing rights were susceptible to being extinguished, there was no evidence of the developer's intent to abandon the rights. The developer easements that remained were insufficient to allow access for further construction of additional units, but they continued to have value. The developer could not add units without an easement from the association, and the association did not have rights to add units. The fact that a stalemate may exist because the parties cannot come to an agreement did not give rise to the impossibility that is required to declare the phasing rights to have been extinguished.

Accordingly, the trial court's judgment was affirmed.

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