stage-run-owners-association-inc-appellantcross-appellee-v-davinder ( 2010 )

MEMORANDUM OPINION
No. 04-10-00195-CV
STAGE RUN OWNERS ASSOCIATION, Inc.,
Appellant
v.
Davinder Singh BAINS and Parmjit K. Bains,
Appellees/Cross-Appellants
v.
KB HOME LONE STAR, L.P.,
Cross-Appellee
From the 37th Judicial District Court, Bexar County, Texas
Trial Court No. 2008-CI-05745
Honorable David A. Berchelmann, Jr., 1 Judge Presiding
Opinion by: Phylis J. Speedlin, Justice
Sitting: Karen Angelini, Justice
Phylis J. Speedlin, Justice
Rebecca Simmons, Justice
Delivered and Filed: November 24, 2010
REVERSED AND REMANDED
1
The Honorable David A. Berchelmann, Jr., presiding judge of the 37th Judicial District Court, Bexar County,
Texas, signed the final judgment; however, the Honorable Antonia Arteaga, presiding judge of the 57th Judicial
District Court, Bexar County, Texas, conducted the hearing on Bains’s motion for partial summary judgment and
granted that motionin Bains’s favor.
04-10-00195-CV
Stage Run Owners Association, Inc. (“the Association”) challenges the summary
judgment granted in favor of Davinder Singh Bains (“Bains”) and Parmjit K. Bains. We reverse
the judgment of the trial court, and remand the case for further proceedings.
FACTUAL AND PROCEDURAL BACKGROUND
In 2004, Bains purchased a new home from KB Home Lone Star, L.P. (“KB Home”)
located in the Stage Run subdivision. The subdivision is maintained and governed by the
Association, which was organized pursuant to the Declaration of Covenants, Conditions and
Restrictions for Stage Run (“the Declaration”). The Declaration requires submission of plans to
the Architectural Control Committee (ACC) for approval before certain improvements can be
made on home lots. Shortly after closing on the home, Bains had concrete pads installed in the
side yards and back yard of the property. Bains subsequently sought approval for the pads from
the Association. The ACC denied approval and demanded that Bains remove the concrete pads.
Three years later, the Association filed suit against Bains for the alleged breach of Article V of
the Declaration, which provides in pertinent part as follows:
No building, fence, wall, parking area, swimming pool, spa, pole, mail box,
driveway, fountain, pond, tennis court, sign, exterior color or shape, or new or
modification of a structure shall be commenced, erected or maintained upon any
Lot or the patio or garage used in connection with any Lot after the purchase of
any Lot from [KB Home], nor shall any exterior addition to or change or
alteration therein be made until the plans and specifications showing the nature,
kind, shape, height, materials and location of the same are submitted to and
approved by the Committee.
The Association sought an injunction requiring Bains to remove the concrete ground
cover, as well as an award of statutory damages and attorney’s fees under the Declaration, the
Property Code, and the Texas Declaratory Judgment Act. See TEX. PROP. CODE ANN. § 5.006
(West 2004); TEX. CIV. PRAC. & REM. CODE ANN. § 37.009 (West 2008).
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Bains answered and filed a third-party petition against KB Home on the grounds that KB
Home arranged and negotiated for the construction of the concrete pads before Bains purchased
the house, while having knowledge of the Declaration which it created as the subdivision builder.
Further, after Bains closed on the house, KB Home paid for the installation of a drainage system
to prevent water from draining off the concrete pads onto Bains’s neighbors’ property. Bains
subsequently moved for summary judgment, contending that (1) Article V does not require ACC
approval for the concrete ground cover at issue because it is not a “structure;” and (2) even if the
ground cover was a structure prohibited by Article V, the Association impliedly waived
enforcement of the restrictive covenant because 45 other Stage Run homeowners added stone or
concrete as ground cover to their lots without ACC approval. Bains attached his affidavit along
with photos of 45 houses in the subdivision with added concrete ground cover visible from the
street.
The Association responded, contending that Bains’s own deposition established that the
ground covers were a structure as contemplated by Article V of the Declaration. The
Association also filed the affidavit of its manager, Laurinda Beaver, who stated that only two
other lots in the subdivision had non-approved concrete ground cover, and that the Association
had notified those homeowners that they were in violation of the Declaration. Bains filed a
motion to disregard Beaver’s affidavit, arguing that it contradicted her later deposition testimony
in which she stated she did not know how many lots had non-approved ground cover, but that it
was more than two. The trial court heard the motion for summary judgment, and after receiving
photographs of the ground cover on Bains’s property, granted Bains’s amended motion for
partial summary judgment on the grounds of waiver and inapplicability of the Declaration to
ground cover. The trial court did not rule on Bains’s motion to disregard Laurinda Beaver’s
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affidavit. After the motion for partial summary judgment was granted, an agreed take-nothing
judgment was rendered as to KB Home, and Bains’s third-party action was dismissed with
prejudice. The judgment states that “in light of the court’s granting of a partial summary
judgment on liability issues in favor of Third-Party Plaintiffs, the Bains, and against Plaintiff
Stage Run Owners Association, Inc., a take-nothing judgment should also be entered in favor or
Third-Party Defendant KB Home Lone Star, L.P.”
The parties proceeded to trial on the sole remaining issue of attorney’s fees. The amount
of the fees was stipulated. The trial court awarded $17,500 in attorney’s fees to Bains under the
Declaratory Judgment Act, as well as conditional appellate fees. The trial court rendered a final
and appealable judgment.
The Association now appeals, complaining of the summary judgment and award of
attorney’s fees. Bains filed a notice of cross-appeal, challenging the trial court’s failure to
disregard the affidavit of Laurinda Beaver, and, in the event that any of the Association’s issues
are sustained, the take-nothing judgment as to KB Home.
STANDARD OF REVIEW AND APPLICABLE LAW
A ruling on a traditional motion for summary judgment is subject to de novo review.
Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211, 215 (Tex. 2003). Summary
judgment is appropriate only when there are no disputed issues of material fact and the moving
party is entitled to judgment as a matter of law. Tex. Commerce Bank, N.A. v. Grizzle, 96
S.W.3d 240, 252 (Tex. 2002). Therefore, a traditional motion for summary judgment is properly
granted if the defendant disproves at least one essential element of the plaintiff’s cause of action,
or establishes all essential elements of an affirmative defense. See D. Houston, Inc. v. Love, 92
S.W.3d 450, 454 (Tex. 2002). If the movant is successful in establishing its right to judgment as
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a matter of law, the burden then shifts to the non-movant to produce evidence raising a genuine
issue of material fact. City of Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678–79
(Tex. 1979). In reviewing a traditional motion for summary judgment, we resolve every doubt
and indulge every reasonable inference in the nonmovant’s favor. SW Elec. Power Co. v. Grant,
73 S.W.3d 211, 215 (Tex. 2002). All evidence favorable to the nonmovant will be taken as true.
Id.
We review the trial court’s construction of a restrictive covenant de novo. Ski Masters of
Tex., LLC v. Heinemeyer, 269 S.W.3d 662, 667 (Tex. App.—San Antonio 2008, no pet.); Owens
v. Ousey, 241 S.W.3d 124, 129 (Tex. App.—Austin 2007, pet. denied). “[R]estrictive covenants
are subject to the general rules of contract construction.” Pilarcik v. Emmons, 966 S.W.2d 474,
478 (Tex. 1998); see also Sonterra Capital Partners, Ltd. v. Sonterra Prop. Owners Ass’n, Inc.,
216 S.W.3d 417, 420–21 (Tex. App.—San Antonio 2006, no pet.). Covenants are examined as a
whole in light of the circumstances present when the parties entered into the agreement.
Pilarcik, 966 S.W.2d at 478. We give effect to every sentence, clause, and word of a covenant,
and avoid constructions that would render parts of the covenant superfluous or inoperative.
Owens, 241 S.W.3d at 129–30. The reviewing court’s primary intent is to ascertain and give
effect to the true intention of the parties as expressed in the instruments. Id. Restrictive
covenants are liberally construed to effectuate their purposes and intent; however, any doubts are
resolved in favor of the free and unrestricted use of the premises. See TEX. PROP. CODE ANN.
§ 202.003(a) (West 2007); Sonterra Capital Partners, 216 S.W.3d at 420.
Whether a restrictive covenant is ambiguous is a matter of law for the court to decide.
Universal Health Servs., Inc. v. Renaissance Women’s Group, P.A., 121 S.W.3d 742, 746 (Tex.
2003); Pilarcik, 966 S.W.2d at 478. A covenant is unambiguous if, after appropriate rules of
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construction have been applied, the covenant can be given a definite or certain legal meaning.
Pilarcik, 966 S.W.2d at 478; Pitman v. Lightfoot, 937 S.W.2d 496, 517 (Tex. App.—San
Antonio 1996, writ denied) (holding same concerning contracts generally). In contrast, if, after
appropriate rules of construction have been applied, a covenant is susceptible of more than one
reasonable interpretation, the covenant is ambiguous. Pilarcik, 966 S.W.2d at 478. Summary
judgment is improper where a restrictive covenant is ambiguous because the interpretation of an
ambiguous contract is a question of fact for a jury. See Dynamic Publ’g & Distrib. L.L.C. v.
Unitec Indus. Ctr. Prop. Owners Assoc., Inc., 167 S.W.3d 341, 345 (Tex. App.—San Antonio
2005, no pet.). Mere disagreement over a restrictive covenant’s interpretation does not
necessarily render the covenant ambiguous. In re D. Wilson Constr. Co., 196 S.W.3d 774, 781
(Tex. 2006); Hodas v. Scenic Oaks Prop. Ass’n, 21 S.W.3d 524, 528 (Tex. App.—San Antonio
2000, pet. denied).
DISCUSSION
Applicability of Article V of the Declaration
The Association first contends the trial court erred in finding the large areas of concrete
ground cover are not ‘structures’ and thus do not require approval by the ACC. The Texas
Supreme Court has noted that the word ‘structure’ can be used in either a broad or restricted
sense. Stewart v. Welsh, 142 Tex. 314, 178 S.W.2d 506, 508 (1944); see also Voice of the
Cornerstone Church Corp. v. Pizza Prop. Partners, 160 S.W.3d 657, 669 (Tex. App.—Austin
2005, no pet.). The broad definition is: “Any production or piece of work artificially built up, or
composed of parts joined together in some definite manner; any construction.” Stewart, 178
S.W.2d at 508. The restricted definition of ‘structure’ is: “A building of any kind, chiefly a
building of some size or of magnificence; an edifice.” Id. The Association advocates for a broad
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application of the term ‘structure,’ which includes “any construction.” It points to excerpts from
Bains’s deposition, in which he testified that it took about three weeks to erect the ground cover,
which consisted of framing of areas with wooden forms, installation of metal mesh, drilling of
holes into the foundation of the house to tie the ground cover to the house, and pouring and
leveling of concrete. Because Bains admitted to constructing the concrete pads from
components, the Association maintains that they are structures requiring ACC approval.
The Association cites several Texas cases to support its argument that the ground cover is
a structure. Aside from choosing between a broad or narrow definition of ‘structure,’ the cases
all focus on the intent of the drafters when construing the restriction at issue. In Stewart, the
court held that a fence was a structure falling within a restrictive covenant prohibiting a
“structure of any kind” from being built on a utility easement. Stewart, 178 S.W.2d at 507–08.
The Stewart court reached this conclusion after considering the intent of the restrictive covenant,
which was to prevent the construction of a house, building, or other substantial structure on the
utility easement because any such house, building, or other structure would likely interfere with
the free use of the area for the installation and maintenance of water, gas, sewer, light, power and
telephone lines. Id. at 508. Because the fence was seven-feet high and built from rails, pickets,
and posts set in the ground, it constituted a “material obstacle to the use of the reserved area for
its intended purpose.” Id. In DeNina v. Bammell Forest Civic Club, Inc., 712 S.W.2d 195, 198
(Tex. App.—Houston [14th Dist.] 1987, no writ), the appellate court examined whether a
thirteen-foot diameter satellite disc and its poured-cement base violated a provision of a deed
restriction which provided that all subdivision lots must be used for residential purposes and that
no structure could be built or placed on the lot other than a single-family home and a garage. Id.
at 198. The DeNina court held that the satellite disc was not a structure because it was not a
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multi-family residence, and the purpose of the particular deed restriction was to limit residences
within the subdivision to single-family residences. 2 Id. Most recently, the Austin Court of
Appeals held that a baptismal pool violated a restrictive covenant prohibiting “subsurface
structures.” Voice of the Cornerstone Church, 160 S.W.3d at 662, 669. In reaching its decision,
the court considered the entire covenant, which provided that the property was to be used for
“commercial/light industrial” purposes, as well as the fact that the baptismal pool was created by
converting an in-ground petroleum tank into a four-and-a-half feet deep pool with concrete walls
and floor. Id. at 669.
Bains responds that when looking at the restrictive covenant as a whole, it is clear the
drafters did not intend to prohibit concrete ground cover. Relying on the rule expressio unius est
exclusion alterius (the express mention of one thing is tantamount to the exclusion of all others),
Bains infers that because Article V specifically lists 13 items which require ACC approval, yet
does not include a sidewalk or patio, the drafters must have intended to exclude ground cover.
Further, Bains suggests that here the word “structure” refers to something more substantial than
poured concrete and applies to above-ground structures, not ground cover. In support, he points
to Turner v. England, in which the Eastland Court of Appeals held that a concrete tennis court
slab was not a ‘structure’ prohibited by a 50-foot setback line. Turner v. England, 628 S.W.2d
213, 214 n.3, 216 (Tex. App.—Eastland 1982, writ ref’d). Turner noted that there was no
contention that street lights, fences, stone walls, and paved driveways closer than 50 feet to the
street were “structures.” Id. at 215. Bains urges us to strictly construe the restrictive covenant
against the Association, and to resolve any doubts in favor of the free use of the premises.
2
The DeNina court went on to hold that the satellite disc violated another section of the deed restriction prohibiting
electrical antenna. Id. at 198-99.
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In construing the restrictive covenant, our primary task is to determine the intent of its
drafters. Wilmoth v. Wilcox, 734 S.W.2d 656, 658 (Tex. 1987). Here, the Declaration states that
it was created for the purpose of “enhancing and protecting the value, desirability and
attractiveness of [the subdivision].” Mindful of this, it is apparent that the drafters of the
Declaration intended to require ACC approval for exterior modifications to the property. Bains
admitted that the ground cover was installed by framing areas with wooden forms, installing
metal mesh, drilling holes into the foundation of the house to tie the ground cover to the house,
and pouring and leveling concrete. Clearly, these actions constitute modifying the exterior of
Bains’s property. Because the concrete ground cover installed by Bains is an exterior
modification, we conclude it falls within Article V of the Declaration. Accordingly, we hold as a
matter of law that the concrete ground cover constructed by Bains is a structure falling within
Article V of the Declaration. Thus, we sustain the Association’s first issue, and reverse the
summary judgment in favor of Bains on this ground.
Waiver
The Association next argues that Bains did not establish his claim of waiver as a matter
of law. In order to establish the affirmative defense of waiver in a deed restriction case, the non-
conforming user must prove that the violations then existing are so great as to lead the mind of
the “average man” to reasonably conclude that the restriction in question has been abandoned
and its enforcement waived. New Jerusalem Baptist Church, Inc. v. City of Houston, 598
S.W.2d 666, 669 (Tex. App.—Houston [14th Dist.] 1980, no writ). Among the factors to be
considered by the “average man” are the number, nature, and severity of the then existing
violations, any prior acts of enforcement of the restriction, and whether it is still possible to
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realize to a substantial degree the benefits intended through the covenant. Id.; Pebble Beach
Prop. Owners’ Ass’n v. Sherer, 2 S.W.3d 283, 290 (Tex. App.—San Antonio 1999, pet. denied).
Bains submitted his affidavit along with photographs of 45 other homes in the Stage Run
subdivision with added concrete ground cover or stone flat work. These photographs alone,
however, cannot establish that the Association waived enforcement of the Declaration. First, it is
unknown whether the additions were made after the houses were purchased from KB Home.
Further, Bains does not provide any information as to whether the owners of these houses
requested ACC approval, nor does he offer any testimony to show that the ACC did not approve
the additions. Even assuming the affidavit of Laurinda Beaver was struck, as Bains argues it
should have been, the photographs do not amount to more than a scintilla of evidence that the
Association waived enforcement of Article V. We conclude Bains failed to conclusively
establish his affirmative defense of waiver as a matter of law. Accordingly, summary judgment
on the ground of waiver was improper. See D. Houston, 92 S.W.3d at 454. Because the award
of attorney’s fees was premised on the granting of summary judgment in Bains’s favor, we also
reverse the award of attorney’s fees. We sustain the Association’s second and third issues,
reverse the summary judgment on the ground of waiver, and remand the cause to the trial court
for further proceedings.
Cross-Appeal: Third Party Action Against KB Home
In his issue on cross-appeal, Bains requests that in the event we remand the cause, we
also reverse and remand the dismissal of his third-party action against KB Home. If a trial is
necessary, Bains plans to assert that any violation of a restrictive covenant was with the express
approval of KB Home and was caused by the false representations to Bains by KB Home’s
superintendent, and to seek damages and indemnity or contribution from KB Home. Since
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Bains’s rights against KB Home derive from the Association’s rights against Bains, Bains claims
a remand of the third-party action is necessary.
The order dismissing KB Home was premised on the granting of summary judgment on
the liability issues in Bains’s favor. Because we are now reversing the order granting partial
summary judgment and remanding the cause to the trial court, we agree that Bains should be
permitted to pursue his claims for indemnity or contribution against KB Home. Accordingly, we
also reverse the dismissal order, and remand the cause to the trial court for further proceedings.
CONCLUSION
Both the order granting partial summary judgment and the order granting attorney’s fees
to Bains are reversed. Additionally, we reverse the order rendering a take-nothing judgment as
to KB Home. The cause is remanded to the trial court for further proceedings.
Phylis J. Speedlin, Justice
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