Title: Creed v. Clogston

State: vermont

Issuer: Vermont Supreme Court

Document:

Creed v. Clogston (2002-426); 176 Vt. 436; 852 A.2d 577

2004 VT 34

[Filed 16-Apr-2004]

       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.

                                 2004 VT 34

                                No. 2002-426

  James and Judith Creed, et al.	         Supreme Court

                                                 On Appeal from
       v.	                                 Rutland Superior Court

  Francis and Debra Clogston	                 November Term, 2003

  William D. Cohen, J.

  Allan R. Keyes of Ryan Smith & Carbine, Ltd., Rutland, for
    Plaintiffs-Appellees.

  Alison J. Bell of Langrock Sperry & Wool, LLP, Burlington, and Timothy L.
    Taylor of Meub Associates, Inc., Rutland, for Defendants-Appellants.

  Andrew W. MacLean, Christopher K. Rice, and Philip H. White of Wilson &
    White, P.C., Montpelier, for Amici Curiae Vermont Bankers Association and
    Vermont Mortgage Bankers Association.

  PRESENT:  Amestoy, C.J., Johnson and Skoglund, JJ., and Crawford, Supr. J.
            and Gibson, J. (Ret.),  Specially Assigned

        
       ¶  1.  AMESTOY, C.J.   In this appeal, we consider whether a
  restrictive covenant prohibiting the installation of "mobile homes, campers
  or trailers" for residential purposes prevents defendants Francis and Debra
  Clogston from placing a "manufactured home" on their lot.  The trial court
  found that the mobile home covenant in defendants' deed reflected an intent
  to exclude all non-site-built homes from defendants' neighborhood.  The
  court explained that, regardless of the name given to defendants' home, it
  was a "mobile home" within the meaning of the restrictive covenant because
  it fell within the type of housing that the covenant sought to preclude. 
  The court therefore granted permanent injunctive relief to plaintiffs, and
  ordered defendants to remove their home.  On appeal, defendants argue that
  the trial court erred in ascertaining the intent of the parties to their
  deed.  We agree, and reverse and remand for additional findings. 

       ¶  2.  The material facts are largely undisputed.  In March 2002,
  defendants purchased an undeveloped lot from Wales Realty Incorporated. 
  Their deed contains the following covenants: 

    1. The use of this lot shall be restricted to one single-family
       dwelling.  

    2. This lot and dwelling shall be used and maintained for
       residential purposes only. 
       
    3. This lot shall not be subdivided.  

    4. No mobile homes, campers or trailers shall be installed for
       residential purposes, even on a part-time basis.  

    5. This lot shall not be used commercially or for business
       purposes.  

    6. No dwelling shall be constructed unless the cost above the
       foundation exceeds $60,000. 

  Mr. Clogston testified at trial that he discussed these covenants with a
  Wales Realty representative, John Bloomer, Jr., and informed Mr. Bloomer
  that he intended to place a manufactured home on the lot.  Mr. Bloomer
  executed the deed.

       ¶  3.  Defendants' lot is located within a twenty-lot subdivision
  covering eleven acres.  The original eleven-acre parcel was conveyed by
  Theodore and Charlotte Nicolet to Remo Segalla, Livio Segalla, and Leon
  Arrigo in 1963.  The deed required, among other things, that the
  above-foundation cost of a dwelling equal or exceed $15,000 at the present
  purchasing price of the United States dollar.  The deed did not contain a
  prohibition against mobile homes.  
   
       ¶  4.  The twenty-lot subdivision was created in 1968 by the
  recording of a plat in the Rutland land records.  At the time of
  subdivision's creation, there was no declaration of covenants nor any other
  express scheme of development restricting the eleven-acre parcel.  Between
  1965 and 1969, nine lots were conveyed, and three additional deeds were
  granted correcting the boundaries of some of those lots.  These twelve
  deeds contained the Nicolet covenants but they did not contain any
  additional covenants.

       ¶  5.  In 1969, the Segallas conveyed the remainder of the original
  eleven-acre parcel to Wales Realty.  Wales Realty did not adopt a
  declaration of covenants, nor any other express scheme restricting the
  development of the remaining parcel.  Instead, over a twenty-year period,
  between 1982 and 2002, Wales Realty conveyed eleven lots by eleven separate
  deeds.  Wales Realty incorporated the Nicolet covenants by reference in
  these deeds, and imposed new covenants.  All of the deeds conveyed by Wales
  Realty contain the same covenants found in defendants' deed, although some
  require an above-foundation cost of $50,000 rather than $60,000.  The deeds
  provide that the enforcement of the covenants is the "responsibility,
  privilege, and right" of the owners of any lots that are subject to the
  covenants. 

       ¶  6.  In April 2002, defendants purchased a 1600-square-foot
  single-level manufactured home from Moore's Auto.  The home was delivered
  in two pieces on wheels that were temporarily attached to permanent
  I-beams.  The two halves of the home were placed on and affixed to a
  concrete slab foundation, and were joined in the middle through a bolting
  system.  Water, sewage, and electricity hookups were established.  Workers
  placed siding on both ends of the home, finished the roof, hung doors and
  electrical fixtures, and finished the walls and floors.  This process took
  approximately 150 hours to complete, and defendants were able to move in
  within approximately one week after their home was delivered. 
        
       ¶  7.  Plaintiffs James and Judith Creed, Karen Harrison, Arlie Welch,
  Ray and Laura Wilburn, Jean O'Rourke, John and Jody LaFaso, Anthony and
  Lise Chioffi, and Diane Byrne reside in defendants' neighborhood and with
  the exception of Harrison, Welch, and the Wilburns, (FN1) their deeds
  contain the restrictive covenant prohibiting the installation of mobile
  homes.   In April 2002, plaintiffs filed a complaint against defendants
  seeking injunctive relief, arguing that defendants' home violated the
  mobile home covenant.

       ¶  8.  After a trial, the court granted permanent injunctive relief to
  plaintiffs.  The court concluded that the mobile home covenant in
  defendants' deed was intended to prohibit non-site-built homes from
  defendants' neighborhood.  In reaching its conclusion, the court began its
  analysis by considering the relationship between the terms "mobile home"
  and "manufactured home" under state and federal law.  The court found that,
  although the term "manufactured home" had replaced the term "mobile home"
  under federal law in 1980, the Vermont legislature had not amended its
  statutes accordingly.  Thus, the court reasoned, because the Vermont
  legislature had not adopted the term, the drafter's failure to use it in
  the deed was not dispositive of an intent to exclude such homes,
  particularly because the term was "relatively new" in 1982.   
   
       ¶  9.  Examining the deed as a whole, the court found it significant
  that the deed required that no dwelling be "constructed" unless its
  above-foundation cost exceeded $60,000.  Relying on a dictionary definition
  of the term "construct," the court found that the use of the term reflected
  the drafter's intent that "any home placed on the defendants' land be
  site-built, that is, . . . constructed on site."  The court found that
  defendants' home had not been "constructed" on their property, but instead
  had been constructed in a factory and then brought to the site.  

       ¶  10.  Taking this provision together with the covenant prohibiting
  mobile homes, the court concluded that it was evident that the drafters of
  the covenant intended to create a neighborhood that contained only
  site-built homes.  To implement this intent, the court refused to give the
  term "mobile home" a static definition.  Instead, the court considered
  defendants' home a "mobile home" within the meaning of the restrictive
  covenant because it fell within the type of housing that the covenant
  sought to preclude.  Based on its conclusion, the court granted permanent
  injunctive relief to plaintiffs, and ordered defendants to remove their
  home within six months.  Defendants appealed, and pursuant to their
  request, the trial court stayed its order pending the resolution of this
  appeal.  

       ¶  11.  On appeal, defendants assert that the trial court erred in
  concluding that their manufactured home violated the terms of the
  restrictive covenant in their deed.  Specifically, they argue that: (1) the
  court erred as a matter of law in concluding that the terms of the mobile
  home covenant were ambiguous; (2) alternatively, if the covenant is
  ambiguous, the court erred as a matter of law by ignoring the
  uncontroverted and direct evidence of the parties' intent at the time the
  deed was executed; and (3) the court's finding that the mobile home
  covenant was intended to prohibit manufactured homes was clearly erroneous.  
   
       ¶  12.  We first address defendants' assertion that the trial court
  erred in finding the mobile home covenant ambiguous.  According to
  defendants, the covenant is unambiguous because it plainly prohibits only
  those homes that are "moveable and transitory in nature," not those that
  are permanent and immovable.  In support of this argument, defendants point
  to the use of the words "mobile" and "part-time basis" in the deed, as well
  as the grouping of the term "mobile home" with other dwellings that are
  "mobile" in nature.  Defendants assert that the uncontroverted evidence
  shows that their home is "of a fixed and permanent nature," and no more
  movable than any "stick-built" home.  Thus, they maintain that their home
  is not prohibited by the plain language of the mobile home covenant. 

       ¶  13.   When the meaning of a restriction in a deed is clear and
  unambiguous, "there is no room for construction and the instrument must be
  given effect according to its terms."  Aiken v. Clark, 117 Vt. 391, 393,