Title: ANN T. DWAN v. INDIAN SPRINGS RANCH HOMEOWNERS ASSOCIATION, INC., a Wyomng nonprofit corporation

State: wyoming

Issuer: Wyoming Supreme Court

Document:

ANN T. DWAN v. INDIAN SPRINGS RANCH HOMEOWNERS ASSOCIATION,  INC., a Wyomng nonprofit corporation 2008 WY 74186 P.3d 1199Case Number: No. S-07-0154Decided: 06/30/2008
APRIL 
TERM, A.D. 2008

 
 
ANN T. 
DWAN,Appellant(Plaintiff),v.INDIAN SPRINGS RANCH 
HOMEOWNERS ASSOCIATION, INC., a Wyoming nonprofit 
corporation,Appellee(Defendant).

 
 
Appeal 
from the DistrictCourtofTetonCounty

The 
Honorable Nancy J. Guthrie, Judge

 
 

Representing 
Appellant:

David G. 
Lewis, Jackson, Wyoming

 
 

Representing 
Appellee:

Frank 
Hess of Hess Carlman & D'Amours, LLC, Jackson, Wyoming; Heather 
Noble, Jackson, Wyoming.  
Argument by Mr. Hess. 

 
 
Before 
VOIGT, C.J., and GOLDEN, HILL, KITE, BURKE, JJ.

 
 

GOLDEN, 
Justice.

 
 
[¶1]      Ann Dwan appeals 
from the grant of summary judgment to the Indian Springs Ranch Homeowners 
Association (HoA).  Dwan sued the 
HoA after its Board denied Dwan's application to build an addition onto her 
residence.  Dwan claims the Board 
unreasonably denied her application.  
The HoA responded, in part, that Dwan's next course of action should have 
been to follow internal HoA procedures to seek a variance of the covenant 
invoked to deny her application rather than bring a legal action against 
it.  Both parties moved for summary 
judgment.  The district court denied 
summary judgment to Dwan and granted summary judgment to the HoA on the ground 
that Dwan had not complied with the variance requirements of the covenants.  We disagree that Dwan was required to 
pursue a variance before filing the instant action, and therefore reverse the 
district court.  Further, finding no 
question of material fact exists, we remand with instructions to the district 
court to enter summary judgment in favor of Dwan.

 
 

ISSUES

 
 
[¶2]      Dwan presents the 
issue as whether the Board acted unreasonably in rejecting her application to 
build a proposed addition to her residence.  Under this rubric she also argues the 
HoA cannot make her seek a variance.

 
 

FACTS

 
 
[¶3]      All land owners 
in the Indian Springs Ranch subdivision, including Dwan, are subject to recorded 
Covenants, Conditions and Restrictions (CCRs).  Among other things, the CCRs require 
landowners to seek permission of the Design, Environment and Wildlife (DEW) 
Committee before engaging in any construction in the subdivision.  The DEW Committee reviews submitted 
building plans and then recommends to the Board that a plan "be approved, 
approved subject to conditions, or disapproved." 

 
 
[¶4]      In 1998, Dwan 
began the process of constructing a residence on her lot.  Her residence was designed with a roof 
pitch of a ten-inch vertical rise for every twelve inches of horizontal 
distance.  This pitch is steeper 
than the pitch allowed for by the CCRs, which is eight inches per twelve 
inches.  Despite this nonconformity, 
her building plan was approved, and the construction of her residence was 
completed in 1999.  In 2003, Dwan 
sought, and received, approval to build a detached structure that would serve as 
both a guesthouse and a garage.  
This detached building was approved and constructed with the same roof 
pitch as her residence.

 
 
[¶5]      This dispute 
began in 2006, when Dwan presented building plans to the DEW Committee for a 
proposed addition to her residence.  
The plans showed the same roof pitch as her residence and 
guesthouse/garage.  This time, the 
DEW Committee and the Board denied her application, citing the non-conforming 
roof pitch as the reason for the denial.  
The CCRs provide a method for presenting an application directly to the 
HoA Members to receive a variance.  
Instead of seeking a variance from the Members, Dwan brought the instant 
action.

 
 

DISCUSSION

 

 
 
[¶6]      We review a 
summary judgment using the same standards which applied to the proceedings 
below, and using the same materials.  
The propriety of granting a motion for summary judgment depends upon the 
correctness of the dual findings that there is no genuine issue as to any 
material fact and that the prevailing party is entitled to judgment as a matter 
of law.  W.R.C.P. 56(c).  A genuine issue of material fact exists 
when a disputed fact, if proven, would have the effect of establishing or 
refuting an essential element of an asserted cause of action or defense.  We examine the record from a vantage 
point most favorable to the party who opposed the motion, affording to that 
party the benefit of all favorable inferences that fairly may be drawn from the 
record.  Mathisen v. Thunder Basin Coal Co., LLC, 
2007 WY 161, ¶ 9, 169 P.3d 61, 64 (Wyo. 2007); Jacobson v. Cobbs, 2007 WY 99, ¶ 7, 160 P.3d 654, 657 (Wyo. 2007); Martin v. 
Committee for Honesty and Justice at Star Valley Ranch, 2004 WY 128, ¶ 8, 
101 P.3d 123, 127 (Wyo. 2004).

 
 
Variance

 
 
[¶7]      The HoA argues 
the district court was correct in determining Dwan was required to seek a 
variance prior to bringing legal action against it.  We disagree.  Pursuant to the pertinent Covenant: "A 
variance shall be allowed from the conditions and restrictions of any of these 
Covenants upon the written approval of the Members of the Association owning 
two-thirds of the Sites after recommendation of approval by the Board."  As the Chairman of the DEW Committee 
explained in correspondence to Dwan, without the recommendation of the Board, 
"an Applicant may not seek a 2/3 vote and will be bound by the decision of the 
Board."  In that same 
correspondence, Dwan was informed "the DEW Committee and the ISR Board 
disapprove of your application for a remodel." 

 
 
[¶8]      Although the CCRs 
allow for plans to be approved subject to conditions, the DEW Committee and the 
Board did not take that approach.  
They denied her application outright.  In fact, there is no indication anywhere 
in the correspondence that the Board would recommend approval of her application 
to the Members, thus allowing her plans to go to a vote for a variance.  In toto, in this correspondence the DEW 
Committee and the Board not only rejected Dwan's application but also indicated 
there was no possibility of successfully pursuing a variance as described in the 
CCRs.  Consequently, under the 
circumstances, Dwan was not required to take any further action as a 
precondition to initiating and maintaining this legal action.1

 
 
Reasonableness 
of the Denial of Dwan's Application

 
 
[¶9]      Both sides look 
to the CCRs to support their respective positions on the appropriateness of the 
DEW Committee and the Board's denial of Dwan's application.  While this Court construes CCRs as it 
would any contract, there are a few significant 
embellishments:

 
 
            
We treat restrictive covenants as contractual in nature and interpret 
them in accordance with the principles of contract law.  McLain v. Anderson, 933 P.2d 468, 474 (Wyo.1997); Anderson [v. Bommer], 926 P.2d [959] at 961 
[(Wyo. 1996)]; 
McHuron v. Grand Teton Lodge Co., 899 P.2d 38, 40 (Wyo.1995).  Most 
importantly, "[w]e seek to determine and effectuate the intention of the 
parties, especially the grantor(s), as it may appear or be implied from the 
instrument itself."  Anderson, 926 P.2d  at 961.  We ascertain the true 
intention of the parties by looking at the writings as a whole, construing them 
to effectuate the intent of the parties. Sierra Trading Post, Inc. v. Hinson, 996 P.2d 1144, 1148 (Wyo.2000) (citing Kindler v. Anderson, 433 P.2d 268, 
270-271 (Wyo.1967)); McHuron, 899 P.2d  at 41.

 
 
            
Whether language is ambiguous is a question subject to de novo review by 
this Court. Samuel [v. Zwerin], 868 P.2d [265] at 266 
[(Wyo. 
1994)].  "Language is ambiguous if 
it contains a double meaning."  
Id.  (citing McNeiley v. Ayres Jewelry Co., 855 P.2d 1242, 1244 (Wyo.1993) (citing Cliff & 
Co., Ltd. v. Anderson, 777 P.2d 595, 599 (Wyo.1989))).  Restrictive covenant language that is 
clear and unambiguous is construed according to its plain and ordinary meaning 
without reference to attendant facts, circumstances or extrinsic evidence.  McLain, 933 P.2d  at 474 (citing American Holidays, Inc. v. Foxtail Owners 
Ass'n, 821 P.2d 577, 579 (Wyo.1991); Klutznick v. Thulin, 814 P.2d 1267, 1270 
(Wyo.1991); Knadler v. Adams, 661 P.2d 1052, 1053 (Wyo.1983)).  
Restrictions upon the use of land are not favored, will not be extended 
by implication and, when in doubt, will be construed in favor of the free use of 
the land. Kindler, 433 P.2d  at 
271.

 
 

Hutchison 
v. Hill, 3 P.3d 242, 245 (Wyo. 2000).

 
 
[¶10]   First, the Board argues it 
disapproved Dwan's application because it is without discretion to grant 
variances from unambiguously articulated restrictions in the CCRs.  Specifically, in this case, the DEW 
Committee and the Board argue they are without discretion to grant a variance 
regarding the roof pitch because the CCRs state the acceptable roof pitch with 
mathematical certainty; the decision is therefore not amenable to a review for 
reasonableness.  Reading the CCRs as 
a whole, however, we find no provision preventing the DEW Committee and/or the 
Board from granting variances.  The 
variance provision discussed above simply states a variance "shall be allowed" 
upon appropriate approval of the Members.  
It does not preclude the DEW Committee or the Board from granting 
variances at their own discretion.  

 
 
[¶11]   Many provisions in the CCRs 
indicate that the Board has the authority to grant variances.  For instance, the CCR regulating height 
and floor area provides:

 
 
Prior 
variances or deviations from the design and construction requirements shall not 
estop or prevent the Board or the DEW Committee from rejecting any subsequent 
application based on lack of conformity or failure to comply with the design 
requirements hereof.  Any waiver of 
any design requirements by the Board or the DEW Committee will constitute a 
waiver for that requirement only, and will not constitute a waiver for any other 
requirement, whether by a different Owner or by the same Owner for a different 
requirement. 

 
 
This is 
a clear indication that variances can be granted by the Board and the DEW 
Committee.  Also, submitted building 
plans are deemed approved if the DEW Committee and the Board do not act within a 
certain time frame.  The only 
exceptions are for plans for structures that exceed the boundary lines of the 
allowable construction area of the site, plans that exceed the height 
limitation, and plans that exceed the floor area limitations, which are deemed 
denied.  Such automatic approval is 
inconsistent with an insistence that no variances be granted except with 
approval of two-thirds of the HoA Members.

 
 
[¶12]   It is particularly disingenuous for 
the DEW Committee and the Board to suggest that they do not have the authority 
to grant a variance for this application considering they granted Dwan two 
variances for her guesthouse/garage in June 2003:

 
 
This 
letter is to confirm that your request to obtain a variance from the DEW 
COMMITTEE of Indian Springs Ranch Subdivision in order to build a guest 
house/garage above the standard 19 feet height limitation is hereby approved to 
26 feet as presented in your plans.  
The DEW COMMITTEE is also approving your variance to allow this same 
structure to exceed the maximum floor area of 1200 square feet as per the C C 
& R's to your proposed 2000 square feet of floor area. 

 
 
Although 
the CCRs were amended in their entirety in 2005, no substantive change was made 
to the language of the variance provision.  

 
 
[¶13]   The bottom line is that the DEW 
Committee and the Board were under no contractual compulsion to reject Dwan's 
application.  The CCRs state that 
approval of applications by the Board "shall not be unreasonably withheld."  The only reason given by the DEW 
Committee and the Board was that the roof pitch did not comply with the 
CCRs.  There was no further 
objection to Dwan's proposed addition.  
Yet Dwan had already received permission for, and built, her residence 
and a detached guesthouse/garage with the identical roof pitch proposed for her 
addition.  One of the purposes of 
the CCRs is to provide for "consistent, compatible and attractive development" 
of sites.  If Dwan were forced to 
follow the roof pitch required by the CCRs, the roof on her addition would not 
be as steep as the roof on the rest of her residence.  That would not constitute "consistent, 
compatible and attractive development."  
As Dwan's architect stated in a letter to the DEW Committee, in his 
opinion, "the design of the existing house would be irreparably damaged by 
changing the roof pitch and would reflect badly on the quality of the 
subdivision."  We think it quite 
unreasonable to require Dwan to alter her roof pitch in order to add an 
otherwise acceptable addition onto her residence. 

 
 
CONCLUSION

 
 
[¶14]   We agree there are no genuine 
issues of material fact, and summary judgment is appropriate in this case.  The only question is the correct 
application of the facts to the language of the CCRs.  Dwan was not required to seek a variance 
from the Members in this case.  
Pursuant to the CCRs, Dwan could only move forward upon recommendation of 
approval by the Board.  The 
correspondence from the DEW Committee and the Board to Dwan clearly indicated 
that the Board was not disposed to give such recommendation.  

 
 
[¶15]   The only objection raised by the 
DEW Committee and the Board to Dwan's application for an addition to her 
residence was that the roof pitch did not conform to the requirements set out in 
the CCRs.  Yet the proposed roof 
pitch was identical to the roof pitch of the rest of the residence, as well as 
the detached guesthouse/garage.  It 
defies reason to require a homeowner to build an addition onto her residence 
with a shallower roof pitch than the rest of the residence.  Her application should be 
approved.

 
 
[¶16]   We remand the case for the entry of 
summary judgment to Dwan on the issue of approval of her application.  Further proceedings consistent with this 
opinion should be conducted as appropriate.

 
 
FOOTNOTES

 
 

1To avoid 
confusion, we emphasize we are not deciding whether seeking a variance from the 
Members is a required precondition under the CCRs to bringing legal action 
against the HoA.  Under the instant 
circumstances, such analysis is unnecessary.  Even if seeking such a variance is a 
general precondition, it would be an exercise in futility for Dwan to further 
pursue the issue.