Title: RIVERVIEW HEIGHTS HOMEOWNERS' ASSOCIATION, & RIVERVIEW HEIGHTS HOMEOWNERS, INC., a Wyoming corporation V. CHRISTOPHER L. RISLOV, an individual, WYOMING RENOVATIONS, INC., d/b/a FAIRGROUND HOMES, a Wyoming corporation

State: wyoming

Issuer: Wyoming Supreme Court

Document:

RIVERVIEW HEIGHTS HOMEOWNERS' ASSOCIATION, & RIVERVIEW HEIGHTS HOMEOWNERS, INC., a Wyoming corporation V. CHRISTOPHER L. RISLOV, an individual, WYOMING RENOVATIONS, INC., d/b/a FAIRGROUND HOMES, a Wyoming corporation2009 WY 55205 P.3d 1035Case Number: S-08-0126Decided: 04/21/2009
APRIL 
TERM, A.D. 2009

 
 
RIVERVIEW 
HEIGHTS HOMEOWNERS' ASSOCIATION, & RIVERVIEW HEIGHTS HOMEOWNERS, INC., a 
Wyoming corporation,

 
 
Appellants

(Plaintiffs),

 
 
v.

 
 
CHRISTOPHER 
L. RISLOV, an individual, WYOMING RENOVATIONS, INC., d/b/a FAIRGROUND HOMES, a 
Wyoming corporation,

 
 
Appellees

(Defendants).

 
 
Appeal 
from the District Court of Fremont County

The 
Honorable Norman E. Young, Judge

 
 
Representing 
Appellants:

Kelly 
A. Rudd, Baldwin, Crocker & Rudd, PC, Lander, 
Wyoming.

 
 
Representing 
Appellees:

Pamala 
M. Brondos and Peter C. Nicolaysen, Nicolaysen & Wilking, PC, Casper, 
Wyoming.  Argument by Mr. 
Nicolaysen.

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

 
 
BURKE, 
Justice.

 
 

[¶1]        
The 
Riverview Heights Homeowners' Association filed suit against Christopher Rislov, 
seeking to enforce an amendment to the subdivision's restrictive covenants.  Mr. Rislov contended that the 
amendment was invalid.  The district 
court granted Mr. Rislov's motion for summary judgment, and the Association 
appealed.  We affirm. 

 
 
ISSUE

 
 

[¶2]        
The 
Association presents one issue:  Did 
the district court err in ruling that the 2004 Amended Covenants are invalid as 
a matter of law?

 
 
FACTS

 
 

[¶3]        
Riverview 
Heights is a residential subdivision located northwest of Riverton, 
Wyoming.  In 1977, the developer 
filed and recorded restrictive covenants for the subdivision.  In 1979, the developer again filed and 
recorded restrictive covenants.1  The 1979 Covenants are nearly identical 
to the earlier ones, except for a provision for creating a homeowners' 
association, under which the Riverview Heights Homeowners' Association was 
formed.  The two sets of restrictive 
covenants contain a provision, set forth in Paragraph 14 of each document, 
establishing how the covenants may be amended:

 
 
The 
rights, duties, obligations and restrictions herein created are for the benefit 
of all of the land in said tract and they are and shall be irrevocable and 
perpetual until and unless revoked, obligated, modified or amended by 
instruments executed and acknowledged in the form prescribed for the execution 
of deeds by seventy-five (75) percent of the owners of the total acreage 
contained in this tract.

 
 

[¶4]        
In 
2004, the Association filed and recorded an "Amendment to Restrictive Covenants 
on Use of Land in Riverview Heights Subdivision."  The 2004 Amendment prohibited 
manufactured homes in the subdivision,2 and provided that all construction 
in the subdivision must be approved by the newly-created architectural control 
committee.  The document was 
executed by the Association's officers, whose signatures were notarized.  The document recited that at least 75% 
of the subdivision's landowners had approved of the amendment.  Attached were thirty-four pages 
containing signatures of lot owners.  
Additional details about these signature pages will be reviewed in the 
discussion section.

 
 

[¶5]        
In 
2007, Mr. Rislov purchased Lot 69 in the Riverview Heights Subdivision.3  He began preparing the lot for a 
manufactured home.  The Association 
contacted Mr. Rislov to inform him that the 2004 Amendment to the covenants 
prohibited manufactured homes and required approval of an architectural control 
committee before development.  
Mr. Rislov disagreed.  
Litigation ensued.  

 
 

[¶6]        
The 
Association and Mr. Rislov presented their dispute to the district court in 
cross-motions for summary judgment.  
The district court ruled that the amendment was invalid because it had 
not been executed and acknowledged as required by the 1977 and 1979 
Covenants.  It granted summary 
judgment in favor of Mr. Rislov, and the Association 
appealed.

 
 
STANDARD 
OF REVIEW

 
 

[¶7]        
We 
employ a familiar standard of review when considering a district court's summary 
judgment decision:

  

Summary 
judgment is appropriate when there are no genuine issues of material fact and 
the moving party is entitled to judgment as a matter of law.  W.R.C.P. 56(c); Metz Beverage Co. v. Wyoming Beverages, 
Inc., 2002 WY 21, ¶ 9, 39 P.3d 1051, 1055 (Wyo. 2002).  "A genuine issue of material fact exists 
when a disputed fact, if it were proven, would establish or refute an essential 
element of a cause of action or a defense that the parties have asserted."  Id.  Because summary judgment involves a 
purely legal determination, we undertake de novo review of a trial court's 
summary judgment decision.  Glenn v. Union Pacific R.R. Co., 2008 WY 
16, ¶ 6, 176 P.3d 640, 642 (Wyo. 2008).

 
 

Jacobs 
Ranch Coal Co. v. Thunder Basin Coal Co., LLC, 
2008 WY 101, ¶ 8, 191 P.3d 125, 128-29 (Wyo. 2008).  We view the facts from the vantage point 
most favorable to the party opposing the motion, and give that party the benefit 
of all favorable inferences that may fairly be drawn from the record.  Brumbaugh v. Mikelson Land Co., 2008 WY 
66, ¶ 11, 185 P.3d 695, 701 (Wyo. 2008).

 
 
DISCUSSION

 
 

[¶8]        
Restrictive 
covenants

 
 
are 
contractual in nature and are interpreted according to principles of contract 
law. Goglio [v. Star Valley Ranch Ass'n, 2002 WY 94,] 
¶ 18, 48 P.3d [1072,] 1079 [(Wyo. 2002)]. A court's goal is to determine 
and effectuate the intention of the parties, especially the grantor or 
declarant. Stevens v. Elk Run Homeowners' 
Ass'n, Inc., 2004 WY 63, ¶ 13, 90 P.3d 1162, 1166 (Wyo. 2004). We first 
examine the language of the covenants and give the words their plain and 
ordinary meaning. Seven Lakes Dev. Co., 
L.L.C. v. Maxson, 2006 WY 136, ¶ 10, 144 P.3d 1239, 1245 (Wyo. 2006). 
We consider the whole document and not just one clause or paragraph. Stevens, ¶ 13, 90 P.3d  at 
1166.

 
 

Omohundro 
v. Sullivan, 
2009 WY 38, ¶ 9, 202 P.3d 1077, 1081 (Wyo. 2009).

 
 

[¶9]        
In 
determining whether the 2004 Amendment is valid, we must interpret this language 
from Paragraph 14:  

 
 
The 
rights, duties, obligations and restrictions herein created are for the benefit 
of all of the land in said tract and they are and shall be irrevocable and 
perpetual until and unless revoked, obligated, modified or amended by 
instruments executed and acknowledged in the form prescribed for the execution 
of deeds by seventy-five (75) percent of the owners of the total acreage 
contained in this tract.

 
 
We 
are mindful of our obligation to consider the documents in their entirety, but 
we have found no other pertinent or helpful provisions in the 1977 Covenants or 
the 1979 Covenants.  We therefore 
narrow our focus to the provision quoted above.

 
 

[¶10]     
It 
is plain enough that Paragraph 14 requires that any instruments amending the 
covenants must be "executed and acknowledged in the form prescribed for the 
execution of deeds."  The parties 
agree that the prescribed form for the execution of deeds is set forth in Wyo. 
Stat. Ann. § 34-1-113 (2008), which provides that "Execution of deeds, 
mortgages or other conveyances of lands, or any interest in lands, shall be 
acknowledged by the party or parties executing same, before any notarial 
officer."4  The parties disagree, however, about 
whose signatures must be notarized.  

 
 

[¶11]     
The 
Association contends that the 2004 Amendment complied with Paragraph 14 
because the Association's officers signed the document, and their signatures 
were notarized.  On this basis, the 
Association contends that the 2004 Amendment is valid as a matter of law, and 
the district court should have granted the Association's motion for summary 
judgment.  The Association further 
contends that Paragraph 14 is, at the very least, ambiguous.  On this basis, the Association contends 
that the district court erred in granting summary judgment to 
Mr. Rislov.

 
 

[¶12]     
We 
are unconvinced by the Association's contentions, because we find them contrary 
to the plain language of Paragraph 14.  
In simplified form, the language provides that an amendment requires 
"instruments executed and acknowledged . . . by seventy-five (75) percent of the 
owners."  This language is not 
ambiguous or subject to alternative interpretations.  It requires execution and 
acknowledgement by the owners.  Execution and acknowledgement by the 
Association's officers do not satisfy this requirement.  Like the district court, we find no 
other provisions in the restrictive covenants authorizing the Association's 
officers to act on behalf of the owners to amend the 
covenants.

 
 

[¶13]     
Because 
we do not accept the Association's main contentions, we also reject several of 
their supporting arguments.  For 
example, they assert that the 2004 Amendment complied with the statutory 
requirements for execution and acknowledgement, as proven by the fact that the 
county clerk accepted it for filing.  
The clerk's filing of the document may suggest that the 2004 Amendment 
complied with Wyo. Stat. Ann. § 34-1-113.  It does not prove that the 2004 
Amendment complied with Paragraph 14 of the restrictive covenants.  

 
 

[¶14]     
As 
another example, the Association asserts that its officers had inherent 
authority to impose the 2004 Amendment.  
They cite several cases from other jurisdictions suggesting that 
homeowners' associations possess some inherent authorities.  However, not one of the cases includes 
the power to amend restrictive covenants among those inherent authorities.  Typical is Conestoga Pines Homeowners' Ass'n v. 
Black, 689 P.2d 1176, 1178 (Colo. App. 1984), in which the court recognized 
a homeowners' association's authority to enforce restrictive covenants, but did 
not mention any authority to amend those covenants.  We are more strongly persuaded by a case 
from our own jurisdiction, in which we quoted this commentary with 
approval:

 
 
Homeowners 
associations serve three primary functions: levying and collecting assessments; 
managing and maintaining common property for the benefit of residents; and 
enforcing covenants that govern developments. They derive authority to carry out 
these functions from several documents, including the declaration of covenants, 
conditions, and restrictions (CC&Rs), the association's bylaws and articles 
of incorporation, and the deeds to the property within a 
development.

 
 

Goglio 
v. Star Valley Ranch Ass'n, 
2002 WY 94, ¶ 17, 48 P.3d 1072, 1078 (Wyo. 2002), quoting Casey J. Little, 
Riss v. Angel:  Washington Remodels the Framework for 
Interpreting Restrictive Covenants, 73 Wash. L.Rev. 433, 437 
(1998).

 
 

[¶15]     
The 
covenants under review in Goglio 
allowed the association to levy a special assessment upon an affirmative vote of 
two-thirds of its members.  We 
observed that, "Implicit in the [covenant] language that requires approval of 
[two-thirds] of the members of the Association for the imposition of a special 
assessment is the proposition that a special assessment 
cannot be levied without the requisite approval."  Goglio, ¶ 25, 48 P.3d  at 1081 
(emphasis added).  The covenants for 
Riverview Heights allow amendment to the covenants upon approval of 75% of the 
lot owners.  Implicit is the 
proposition that the Association's officers, regardless of any inherent powers 
they might exercise, cannot amend the covenants without the requisite approval 
of 75% of the lot owners.

 
 

[¶16]     
As 
its next contention, the Association claims that Mr. Rislov is equitably 
estopped from challenging the validity of the 2004 Amendment.  However, the cases cited by the 
Association do not apply here.  The 
Association relies on McCarthy v. Union 
Pacific Ry. Co., 131 P.2d 326, 332 (Wyo. 1942) for the general proposition 
that a grantee is estopped by the promises of his grantor where the grantee had 
notice of the promise.  The 
Association contends that Mr. Rislov's grantor, the former owner of Lot 69, 
approved of the 2004 Amendment, and that Mr. Rislov had, at a minimum, 
constructive notice of that fact.  
However, in McCarthy there was 
no dispute that the grantor's promise was valid.  The question was whether that valid 
promise was binding on the grantee.  
In the present case, the 2004 Amendment was not approved by a sufficient 
number of lot owners.  It never 
became binding on Mr. Rislov's grantor, whether or not the grantor approved 
it or "promised" to abide by it.  It 
does not bind Mr. Rislov, whether or not he had notice of 
it.

 
 

[¶17]     
Similarly, 
the Association relies on Bowers Welding 
and Hotshot, Inc. v. Bromley, 699 P.2d 299 (Wyo. 1985), for the general rule 
that restrictive covenants with legal deficiencies may still be enforced in 
equity so long as a grantee has notice of the agreement.  In Bowers Welding, however, the question 
was not whether the restrictive covenants were valid, but whether a mistake in 
the legal description rendered the covenants inapplicable to the particular lot 
in question.  Again, the present 
case involves the underlying validity of the 2004 Amendment, not its 
applicability to Mr. Rislov's lot.  
Applying the cases cited by the Association to the question at issue 
here, we cannot conclude that Mr. Rislov is estopped in equity from 
challenging the validity of the 2004 Amendment.

 
 

[¶18]     
We 
turn finally to the Association's contention that the language of Paragraph 14 
is ambiguous, in that it can reasonably be read to allow different ways of 
counting the owners' votes.  It 
could allow one vote per owner, regardless of how many lots he or she owns.  This, apparently, is the interpretation 
reached by the district court.  
However, the Association contends that it could also allow one vote per 
lot, so that an owner of three lots, for example, receives three votes.5  It is unnecessary to resolve this 
ambiguity, or even to decide whether an ambiguity exists, because the result is 
the same either way the votes are counted.

 
 

[¶19]     
There 
are 96 lots in the Riverview Heights Subdivision.  The parties seem to agree that, at the 
time the 2004 Amendment was filed, there were 43 different owners of the 96 
lots.  Attached to the 2004 
Amendment are signature pages purporting to reflect approval of the amendment. 
 Several of the signature pages are 
not notarized.  Signature pages that 
are not notarized are not properly executed and acknowledged, and we therefore 
agree with the district court that these signature pages are ineffective as 
approvals of the 2004 Amendment.  

 
 

[¶20]     
Subtracting 
out the ineffective approvals, the remaining approvals represent 19 owners of 61 
lots.  Without deciding the point, 
we will treat all of these remaining approvals as valid.6  The valid approvals represent 19 of the 
total 43 owners, or 44%.  They 
represent 61 of the total 96 lots, or 64%.  
Either way the votes are counted, they do not represent approval of the 
2004 Amendment "by seventy-five (75) percent of the owners" of the Riverview 
Heights Subdivision.

 
 
CONCLUSION

 
 

[¶21]     
The 
2004 Amendment to the restrictive covenants for the Riverview Heights 
Subdivision is invalid.  We affirm 
the district court's decision granting summary judgment against the Association 
and in favor of Mr. Rislov.

 
 
FOOTNOTES

 
 

1Despite 
some technical errors in the documents, the parties agree, and the district 
court ruled, that both the 1977 and the 1979 covenants apply to all of the 
property in the subdivision.

2The 
Association seems to take the position that the 1977 and 1979 covenants were 
meant to prohibit all types of manufactured homes, and the 2004 Amendment was 
merely a clarification of that prohibition.  However, the case before us deals only 
with the Association's effort to enforce the 2004 Amendment.  The question of whether the 1977 and 
1979 covenants prohibit manufactured homes is not before us, and cannot be 
addressed in this decision.

3It 
is unclear if the lot is owned by Mr. Rislov or his company, Wyoming 
Renovations, Inc., doing business as Fairground Homes.  The distinction does not affect our 
decision.

4The 
version of the statute in effect when the 2004 Amendment was filed also allowed 
for acknowledgement before certain court personnel or a county clerk, in 
addition to a notary.  See 2008 Wyo. Sess. Laws ch. 20, § 
2.  Because the signatures at issue 
in this case were either acknowledged by a notary or not acknowledged at all, 
the change to the statute has no significance here.

5It 
has also been suggested the phrase "total acreage" in Paragraph 14 could lend 
itself to allowing one vote per acre.  
We reject that interpretation because the plain language of 
Paragraph 14 requires approval "by seventy-five (75) percent of 
the owners of the total acreage."  
(Emphasis added.)

6Mr. 
Rislov challenges the validity of the approvals of two additional owners.  One of the signature pages includes the 
signature of only one of the two owners.  
One owner of several lots submitted an affidavit stating that she had 
approved of the amendment process, but not of the 2004 Amendment itself.  Based on our calculations, however, it 
makes no difference if we treat these two owners' approvals as 
valid.