138 Nev., Advance Opinion 4211 

IN THE SUPREME COURT OF THE STATE OF NEVADA 

JEROME MORETTO, TRUSTEE OF 

THE JEROME F. MORETTO 2006 

TRUST, 

Appellant, 

vs. 

ELK POINT COUNTRY CLUB 

HOMEOWNERS ASSOCIATION, INC., 

Respondent. 

No. 82565 

Appeal from a district court judgment in an action for injunctive 

and declaratory relief concerning a common-interest-community 

homeowners association's power to adopt rules. Ninth Judicial District 

Court, Douglas County; Nathan Tod Young, Judge. 

Affirmed in part, reversed in part, and remanded. 

Lemons, Grundy & Eisenberg and Robert L. Eisenberg and Todd R. 

Alexander, Reno, 

for Appellant. 

Resnick & Louis, P.C., and Prescott T. Jones and Carissa Yuhas, Las Vegas, 

for Respondent. 

BEFORE THE SUPREME COURT, SILVER, CADISH, and PICKERING, 

JJ. 

SUPREME COURT 

OF 

NEVADA 

10) 194Th steMpo 

is- 0 fru) 
OPINION 

By the Court, CADISH, J.: 

In this appeal, we are asked to consider the extent of a commoninterest-community homeowners association's power to adopt rules 

restricting the use and design of individually owned properties. 

Specifically, we are asked to adopt sections 6.7 (use restrictions) and 6.9 

(design restrictions) of the Restatement (Third) of Property: Servitudes. 

Both sections provide that a homeowners association does not have the 

implied power to impose use or design restrictions on individually owned 

properties and that the association's governing documents must expressly 

authorize the imposition of such restrictions to do so. In addition, these 

sections suggest that any such restrictions should be subject to a 

"reasonableness" requirement. 

We conclude public policy favors the adoption of sections 6.7 and 

6.9 of the Restatement (Third) of Property: Servitudes. These two sections, 

when read in conjunction, provide well-reasoned limits on construing an 

association's implied power to act with respect to individually owned 

property. Therefore, we now adopt the approach from these two sections. 

As applied to the underlying matter, we conclude that article 16, section 3 

of the respondent homeowners association's bylaws includes an express 

provision allowing it to adopt design restrictions for individually owned 

property. However, during the proceedings before the district court, neither 

party addressed whether the respondent's exercise of its design-control 

power was reasonable, which is a central tenet of section 6.9. As a result, 

we reverse the district court's grant of summary judgment with respect to 

appellanes claim for declaratory relief, which sought to invalidate 

respondenes newly adopted architectural and design rules. Additionally, 

2 
we reverse the district court's grant of summary judgment with respect to 

appellant's accompanying violation of property rights claim. We remand 

the case back to the district court to consider whether respondent's rules 

are reasonable under sections 6.7 and 6.9 of the Restatement (Third) of 

Property: Servitudes. 

FACTS AND PROCEDURAL BACKGROUND 

Respondent Elk Point Country Club Homeowners Association, 

Inc. (hereinafter EPCC), is the governing body of the Elk Point subdivision, 

a common-interest community located at Lake Tahoes Zephyr Cove, in 

Douglas County, Nevada. EPCC was initially established in 1925 to 

manage land owned by the Northern Nevada chapter of the Elks Club. At 

that time, the land was held as a vacation area for local Elks Club members. 

Beginning in 1929, EPCC began selling individual lots within the 

subdivision. Since then, the subdivision has consisted of both individual 

lots held in private ownership and common property held by EPCC for the 

benefit of all individual property owners within the community. EPCC has 

retained control of the operation of common areas and facilities within the 

community. 

EPCC, as part of its management structure, has both articles of 

incorporation and bylaws. Like most bylaws, EPCCs bylaws set forth the 

governing rules by which EPCC operates, including establishing a fiveperson executive board tasked with managing the affairs of the community. 

Also included in its bylaws is a provision giving EPCC's executive board the 

power to adopt rules and regulations necessary to carry out its powers. 

Specifically, EPCCs bylaws authorize the executive board to "make rules 

and regulations not inconsistent with the laws of the State of Nevada, the 

Articles of Incorporation and the Bylaws of the Corporation." 

3 
EPCC's governing documents are somewhat different from 

most modern common-interest communities in that the covenants 

restricting individual property owners are included in its bylaws, as 

opposed to having a separate declaration of covenants, conditions, and 

restrictions (CC&Rs). Pertinent to this appeal, however, the bylaws include 

article 16, section 3, which imposes a restriction requiring individual 

landowners to seek approval of EPCC's executive board prior to 

constructing any structures on their individually owned property. 

Appellant Jerome Moretto took title to property in the Elk Point 

subdivision in 1990. Included in Moretto's chain of title was a provision 

stating that his property was subject to any and all bylaws, rules, and 

regulations that EPCC establishes. At all relevant times, EPCC's bylaws 

included article 16(3)'s restriction requiring EPCC to pre-approve 

construction of any structure on individually owned lots prior to its 

commencement. 

In 2018, EPCC's executive board, exercising its rulemaking 

authority, adopted a regulation establishing an architectural review 

committee. At the same time, the executive board adopted a set of 

guidelines titled, "Architectural and Design Control Standards and 

Guidelinee (Architectural Guidelines). These guidelines created detailed 

restrictions on individually owned lots, including restrictions regarding 

building height and setbacks as well as design-control restrictions 

regarding exterior lighting, building materials, and landscaping. The new 

regulations required any landowner wanting to develop their lot to comply 

with these new guidelines and to submit any proposed plans to the 

architectural review committee, which, in turn, would recommend to the 

executive board whether to approve the proposed development. 

4 
In response to these new guidelines, Moretto filed a complaint 

seeking, among other things, a declaration that the new guidelines exceed 

the scope of EPCC's rulemaking authority. EPCC filed its answer, and both 

parties subsequently filed competing motions for summary judgment. 

EPCC pointed to article 16(3) of the bylaws regarding its authority to 

approve construction on individually owned lots and its general rulemaking 

authority as the basis for its ability to adopt the Architectural Guidelines. 

Moretto argued EPCC did not have any express power to adopt the 

Architectural Guidelines and advocated that the district court interpret an 

association's implied power to adopt rules under NRS Chapter 116 as being 

limited consistent with sections 6.7 and 6.9 of the Restatement (Third) of 

Property: Servitudes. The district court, without addressing Moretto's 

argument regarding sections 6.7 and 6.9 of the Restatement (Third) of 

Property: Servitudes, held that EPCC did have the authority to adopt rules 

to control the design of individually owned property and therefore did not 

exceed the scope of its authority when adopting the Architectural 

Guidelines. This appeal followed. 

DISCUSSION 

We review de novo a district court's grant of summary 

judgment. Wood v. Safetvay, Inc., 121 Nev. 724, 729, 121. P.3d 1026, 1029 

(2005). Summary judgment is proper when no genuine issue of material 

fact exists, such that the moving party is entitled to judgment as a matter 

of law. Id. 

On appeal, the parties arguments are similar to the ones 

presented to the district court. Moretto advocates that this court should 

adopt sections 6.7 and 6.9 of the Restatement (Third) of Property: 

Servitudes. He contends that section 6.9 requires that an association must 

5 
have express power to adopt design control restrictions, which EPCC does 

not have. Instead, he suggests that under the principles outlined in section 

6.7, EPCC only possesses a general rulemaking power and therefore is 

limited in its power to adopt restrictions concerning individually owned 

property. EPCC does not address whether we should adopt sections 6.7 and 

6.9 of the Restatement (Third) of Property: Servitudes but instead argues 

that its adoption of the Architectural Guidelines was within the scope of its 

authority under its bylaws. 

Restatement (Third) of Property: Servitudes sections 6.7 and 6.9 

Moretto urges this court to adopt sections 6.7 and 6.9 of the 

Restatement (Third) of Property: Servitudes.1 Where parties raise issues of 

a purely legal nature, we will conduct a plenary review. St. James Vill., Inc. 

v. Cunningham, 125 Nev. 211, 216, 210 P.3d 190, 193 (2009). 

Sections 6.7 and 6.9 concern an association's authority to adopt 

rules regarding the use and design of individually owned properties in a 

common-interest community. Section 6.7 of the Restatement (Third) of 

1We reject EPCC's contention that Moretto did not properly preserve 

the issue of whether this court should adopt the Restatement's approach. It 

is a well-recognized rule that issues not raised by a party in the district 

court are deemed waived on appeal. See Old Aztec Mine, Inc. v. Brown, 97 

Nev. 49, 52, 623 P.2d 981, 983 (1981). However, as EPCC concedes, Moretto 

raised the argument regarding the Restatement's approach in its briefing 

to the district court. Old Aztec's bar applies in the limited circumstances 

where the issue has not been "urged in the trial court." See id. While 

Moretto is now urging this court to expressly adopt the Restatement's 

approach, as opposed to asking the district court to interpret NRS Chapter 

116 as being limited by the Restatement's nonbinding principles, we do not 

consider this to be materially different from the point he "urged in the trial 

court." Moreover, because we are considering this issue de novo, we do not 

concern ourselves with the parties arguments regarding whether the 

district court properly considered this issue. 

6 
Property: Servitudes provides that an association authorized to adopt rules 

under a general grant of such power may adopt rules concerning the use of 

individually owned property only to the extent they relate to the protection 

of common property or to the prevention of nuisance-like activities. 

Restatement (Third) of Prop.: Servitudes § 6.7(3) (Am. Law Inst. 2000). 

General rulemaking powers are construed narrowly because a contrary 

interpretation runs counter to the traditional expectation that landowners 

are free to use their property in any manner not expressly prohibited, with 

the limited exception being that an association is permitted to protect 

against neighborhood nuisances by adopting preventative rules. Id. at cmt. 

b. 

While section 6.7 concerns an association's power to adopt rules 

governing the use of property, section 6.9 concerns an association's power to 

adopt rules to control the design of individually owned properties. See 

generally Restatement (Third) of Prop.: Servitudes § 6.9 (Am. Law Inst. 

2000). Section 6.9 states this: 

Except to the extent provided by statute or 

authorized by the declaration, a common-interest 

community may not impose restrictions on the 

structures or landscaping that may be placed on 

individually owned property, or on the design, 

materials, colors, or plants that may be used. 

"The purpose of this section is to negate the existence of implied 

design-control powers." Id. at cmt. b. Section 6.9s rationale parallels the 

reasoning of section 6.7, that an association does not have the implied power 

to restrict the design of individually owned property because such 

restrictions are neither necessary for "the effective functioning of the 

community" nor "further public interests or fulfill reasonable expectations 

of the property owners." Id. at cmt. a. This stance—that design control 

7 
powers are valid only when expressly stated—protects individual 

landowners reliance interest that an association cannot impose designcontrol restrictions absent express authorization by the association's 

declaration. Id. Specifically, "[1] ong tradition supports the individual's 

right to determine the aesthetic qualities of the home and, within limits 

imposed by zoning and building codes, to construct structures that suit his 

or her tastes and needs." Id. 

Sections 6.7 and 6.9s stance regarding an association's implied 

authority to act with respect to individually owned property comes from the 

broader discussion in comment b to section 6.7 addressing the differences 

between restrictions that are imposed as part of the association's 

declaration versus those adopted through the association's rulemaking 

power. See generally Restatement (Third) of Prop.: Servitudes § 6.7 cmt, b. 

Specifically, "rules are usually adopted by the governing board, or by a 

simple majority of the owners who vote on the question, and are seldom 

recorded." Id. This can be contrasted with restrictions included in a 

declaration that "is recorded before individual properties are sold and 

usually can be amended only with the consent of a supermajority of the 

property owners." Id. The drafters worried that if an association's implied 

power to act is construed broadly, an association may be able to adopt 

restrictions concerning the use of individually owned property without the 

"notice and the safeguards afforded by the supermajority vote needed for an 

amendment to the declaration." Id. 

Additionally, the drafters described the difference between an 

association's power and responsibility over common property and that over 

individually owned property. Id. While "an association enjoys an implied 

power to make rules in furtherance of its power over the common property," 

SueRon CouRT 

OF 

NEVADA 

(0) 1947A elialD 8 
it "has no inherent power to regulate use of the individually owned 

properties in the community, . . . except as implied by its responsibility for 

management of the common property." Id. It is this rationale that 

underlies the conclusion that unless an association is expressly given a 

more expansive power, a generally worded rulemaking power included in 

an association's declaration does not provide an association with a broad 

implied power to adopt rules to regulate either the use or design of 

individually owned property. 

We have previously adopted sections of the Restatement (Third) 

of Property: Servitudes when doing so furthered public policy and was 

consistent with Nevada law. See St. James Vill., 125 Nev. at 218-19, 210 

P.3d at 195 (adopting section 4.8 of the Restatement (Third) of Property: 

Servitudes and holding the public policy interests advanced by adopting the 

rule outweighed the potential of any increased litigation associated with its 

adoption); see also Artemis Expl. Co. v. Ruby Lake Estates Homeowner's 

Asen, 135 Nev. 366, 372, 449 P.3d 1256, 1260 (2019) (applying Restatement 

(Third) of Property: Servitudes section 6.2). Moreover, the Restatement's 

approach is consistent with the importance and high value Nevada law 

places on private property ownership and use. See McCarran Int'l Airport 

v. Sisolak, 122 Nev. 645, 659, 137 P.3d 1110, 1120 (2006) (stating "it is clear 

that Nevadans property rights are protected by our State Constitution"); 

State v. Hill, 59 Nev. 231, 239, 90 P.2d 217, 220 (1939) (stating 

unconstitutional regulation of private property constitutes an "invasion 

of . . . [individual] property rights"). Additionally, we conclude that the 

Restatement's approach is consistent with NRS 116.31065s requirement 

that an association's rules be reasonably related to the specified purpose for 

which they are adopted, sufficiently explicit in their prohibition, and in all 

SUPREME COURT 

OF 

NEVADA 

(0) 1947A Gogib. 9 
other aspects consistent with the association's governing documents. See 

NRS 116.31065(1), (2), and (4). 

In weighing the interests discussed above, we conclude that 

public policy interests and Nevada's strong protection of private property 

owners expectations and ownership rights are best served by adopting the 

Restatement's approach. Specifically, we believe that the drafters' rationale 

for these two sections is particularly persuasive. Taking the approach that 

an association does not have an inherent power to regulate individually 

owned property protects the traditional expectations of landowners, ensures 

landowners are afforded proper notice before restrictions are imposed on 

their individual property, and prevents an association from circumventing 

the procedural protections landowners would be afforded if the association 

had adopted the design-control restrictions as covenants in the association's 

declaration. Additionally, we recognize that design-control restrictions, 

where legitimately promulgated, may benefit individual property owners 

within a community. Specifically, requiring a uniform design among 

individual properties may contribute to an increase in property values by 

preventing aesthetic nuisances. Restatement (Third) of Prop.: Servitudes 

§ 6.9 cmt. d. Further, uniformly applied restrictions may improve residents' 

quality of life. See id. 

For these reasons, we adopt sections 6.7 and 6.9 of the 

Restatement (Third) of Property: Servitudes to govern issues concerning an 

association's authority to enact rules regarding the restriction of 

individually owned property. 

Under Restatement sections 6.7 and 6.9, EPCC had the authority to adopt 

the Architectural Guidelines 

Moretto contends that, under the Restatement's approach, 

EPCC did not possess the authority to adopt the Architectural Guidelines. 

10 
Specifically, he appears to argue that (1) EPCC's bylaws only provide the 

association with a generally worded rulemaking power and (2) even if the 

bylaws did expressly authorize EPCC to adopt the Architectural Guidelines, 

EPCC does not have a recorded declaration of CC&Rs that expressly 

authorizes it to do so. 

The district court concluded that article 16(3) of EKC's bylaws 

authorized EPCC to adopt the Architectural Guidelines. Applying the 

Restatement's approach, we agree with the district court's conclusion. 

Article 16(3) states that "[Lilo structure of any kind shall be 

erected or permitted upon the premises of any Unit Owner, unless the plans 

and specifications shall have first been submitted to and approved by the 

Executive Board." We conclude that article 16(3) falls squarely within the 

type of express authorization that section 6.9 requires to allow an 

association to adopt design-control restrictions. Restatement (Third) of 

Prop.: Servitudes § 6.9 cmt. c (stating a provision authorizing an association 

to "approve or disapprove any construction or alteration of the landscape 

within the community" constitutes a valid express design-control power). 

By requiring approval of the plans and specifications for any new 

construction, article 16(3) plainly contemplates the ability of the executive 

board to review and apply appropriate standards to evaluate those items. 

Adopting rules to carry out that express power is thus permissible. 

Instead of addressing this section of EPCC's bylaws, Moretto 

addresses only article 3(2), which states, "Mhe Executive Board shall have 

the power to conduct, manage and control the affairs and business of the 

Corporation and to make rules and regulations not inconsistent with the 

laws of the State of Nevada, the Articles of Incorporation and the Bylaws of 

the Corporation." Neither party disagrees that this provision constitutes a 

11 
generally worded rulemaking power and, if standing alone, would be 

insufficient to adopt the Architectural Guidelines based on Restatement 

section 6.7.2But we disagree with Moretto's overall conclusion that EPCC 

has no authority to adopt design-control restrictions because, as indicated, 

article 16(3) is a valid restrictive covenant that authorizes EPCC to adopt 

rules to control the design of individually owned property within the Elk 

Point community. 

We also disagree with Moretto's second argument that for a 

restrictive covenant affecting individually owned property to be valid, it 

rnust be included in a separate declaration of CC&Rs. Restatement section 

6.9 requires only that an express grant of authority be included in the 

association's "declaration," which is defined as "[a] recorded document or 

documents containing servitudes that create and govern the commoninterest community." Restatement (Third) of Prop.: Servitudes § 6.2(5) (Am. 

Law Inst. 2000). EPCC's bylaws were recorded in Douglas County and, 

thus, fall squarely under the Restatement's definition of a declaration.3 

2As Moretto points out, even EPCC admitted in its motion for 

summary judgment that it does not view article 3(2) as constituting a 

specific grant of authority. 

3We note that NRS 116.037 defines a "declaration" as "any 

instruments, however denominated, that create a common-interest 

community, including any amendments to those instruments." Under this 

definition, most common-interest communities bylaws would not constitute 

a "declaration," and this opinion should not be construed as generally 

equating a common-interest community's bylaws with its "declaration." 

Here, however, Moretto has not relied on NRS 116.037, and EPCC was 

created in 1925, long before NRS Chapter 116 took effect in 1992. See 1991 

Nev. Stat., ch. 245, § 142, at 587 (adopting the Uniform Common-Interest 

Ownership Act effective Jan. 1, 1992). Moreover, we have previously 

declined to apply sections of NRS Chapter 116 to common-interest 

12 
Because these restrictions were contained in EPCC's bylaws that were 

publicly recorded, Moretto and others within the Elk Point community were 

on notice that the association had the authority to pre-approve the 

construction of structures on individually owned property.4 

In conclusion, under the Restatement's approach, article 16(3) 

constitutes a valid restrictive covenant expressly authorizing EPCC to 

adopt the Architectural Guidelines. 

The record on appeal does not demonstrate whether the Architectural 

Guidelines are reasonable 

Although we agree with the district court's conclusion that 

EPCC had the authority to adopt the Architectural Guidelines, we 

nevertheless remand for the district court to consider whether the 

communities that formed prior to the Legislature's adoption of the Uniform 

Common-Interest Ownership Act when doing so is inconsistent with 

legislative intent and strict adherence would lead to unreasonable results. 

See Artemis, 135 Nev. at 372-74, 449 P.3d at 1260-62 (holding NRS 

116.3101(1)s requirement did not apply to pre-1992 common-interest 

communities). Applying the same rationale discussed in Artemis, we hold 

NRS 116.037s definition does not apply to EPCC as a pre-1992 commoninterest community because strict adherence to NRS 116.037s definition of 

a declaration would otherwise frustrate the purpose of subjecting 

communities such as EPCC, which does not have a separate declaration of 

CC&Rs, to NRS Chapter 116. EPCC's bylaws can only be amended by a 

supermajority vote, so they in essence function as a declaration of CC&Rs 

insofar as EPCC and its individual property owners are concerned. Thus, 

based on the specific facts and arguments presented in this case, we 

conclude that NRS 116.037s definition does not apply and EPCC's bylaws 

fall within the Restatement's definition of a "declaration." 

4A1though Moretto purchased his property in 1990 and the record on 

appeal only contains a copy of EPCC's bylaws recorded in 2005, Moretto 

acknowledges that he had notice of and was subject to the bylaws at the 

time of his purchase. 

SUPREME COURT 

OF 

NEVADA 

(o) 1947A CliaND 

13 
Architectural Guidelines are reasonable and thus valid under Restatement 

section 6.9. 

We recognize the concerns that arise when an association's 

declaration, like EPCC's, affords the association a highly discretionary 

power to effectuate design-control restrictions. In fact, comment d to section 

6.9 highlights these concerns: 

Discretionary design controls create two kinds of 

risks for property owners. [First,] Whey may not be 

able to develop in accordance with their 

expectations because they cannot predict how the 

controls will be applied. Second, property owners 

may be subject to arbitrary or discriminatory 

treatment because there are no standards against 

which the appropriateness of the power's exercise 

can be measured. 

Restatement (Third) of Prop.: Servitudes § 6.9 cmt. d. To safeguard against 

these concerns, the drafters note that courts that have considered this issue 

have, instead of invalidating the power, imposed a reasonableness 

requirement. Id. In the context of the adoption of association guidelines, 

as occurred here, the Restatement notes that consistent application of the 

guidelines is 

nearly always upheld if within the scope of the 

design-control power granted by the declaration. 

Decisions made without deliberation and 

articulation of reasons for the decision, decisions 

based on irrelevant criteria or erroneous 

information, and decisions that violate association 

guidelines are nearly always held unreasonable. 

Determining whether design-control powers have 

been unreasonably exercised requires a factspecific, case-by-case inquiry. 

Id. Thus, while we hold that EPCC had authority to adopt the Architectural 

Guidelines based on article 16(3) of the bylaws, this does not mean it has 

14 
unfettered authority to impose any and all restrictions. Rather, we hold its 

authority is cabined by a reasonableness requirement in order to protect the 

rights and expectations of the individual property owners. 

The reasonableness test strikes a balance between ensuring an 

association's action is not beyond the scope of its authority while otherwise 

deferring to the substance of the association's action. Id. Under a 

reasonableness standard, the court's focus is on whether "the committee 

informs itself of the facts and is consistent in its treatment of community 

members," as opposed to focusing on whether the court agrees with the 

"aesthetic judgmenr of the association's decision. Id. 

With respect to this reasonableness test, we find the Appellate 

Court of Connecticut's decision in Grovenburg v. Rustle Meadow Associates, 

LLC, 165 A.3d 193 (Conn. App. Ct. 2017), to be particularly instructive. The 

Grovenburg court discussed, in detail, the factors trial courts should balance 

to determine whether an association's exercise of its design-control 

authority is reasonable. Specifically, it suggested courts should consider 

the following factors: 

the rationales proffered by the association for its 

exercise of discretionary authority; the specific 

nature of the activity proposed by the plaintiffs; the 

relationship between any legitimate interests of the 

association and its exercise of discretionary 

authority; the purposes of the association and the 

general plan of development for the common 

interest community, as reflected in its governing 

instruments; and the extent to which discretionary 

authority was exercised in good faith or in an 

arbitrary manner. 

Id. at 233. We believe these factors are well suited for the type of analysis 

a court should conduct when evaluating the reasonableness of designcontrol restrictions. While this case is distinguishable from Grovenburg in 

15 
that Morettes challenge arises from the adoption of the Architectural 

Guidelines themselves, rather than a specific decision under them, the court 

can look to these factors, to the extent they apply to the circumstances here 

presented, in evaluating the reasonableness thereof. The district court 

must also consider the extent to which the new rules depart from the 

preexisting community design standards in Elk Point and whether the 

restrictions imposed are consistent with similarly situated communities. 

See, e.g., Restatement (Third) of Prop.: Servitudes § 6.9 ills. 8 & 9 

(illustrating how natural or technological changes may render prior 

architectural guidelines impractical or unwarranted justifying changes to 

an association's guidelines); see also Kies v. Hollub, 450 So. 2d 251, 256 (Fla. 

Dist. Ct. App. 1984) (considering whether a landowner's development of his 

property was consistent with properties in similarly situated communities). 

To the extent these guidelines do impose a change in applicable standards, 

the court must weigh the "strength of the reasons supporting the change 

against the fairness claims of the property owners who will be harmed by 

the change." Restatement (Third) of Prop.: Servitudes § 6.9 cmt. d. These 

factors are to be considered on a case-by-case basis and are highly 

dependent on the underlying facts. Id. 

Reviewing the district court's order and the record on appeal, 

we conclude that the parties did not present sufficient evidence for the 

district court to evahiate the reasonableness of the restrictions or for us to 

do so on appeal. Consequently, we remand to the district court to consider 

this issue. On remand, the parties should address, and the district court 

should consider, whether (1) the Architectural Guidelines themselves are 

reasonable and (2) to the extent the restrictions regarding the design of 

individually owned property changed as a result of the new rules in 

SUPREME COURT 

OF 

NEVADA 

(0) 1947A 4441114. 16 
SUPREME COURT 

OF 

NEVADA 

(0) 1947A 41111WID 

comparison to the prior plan approval process, to what extent that change 

is justified and reasonable, consistent with section 6.9 and the factors 

outlined above. The burden will be on Moretto to make a prima facie 

showing that the Architectural Guidelines are unreasonable. See generally 

Restatement (Third) of Prop.: Servitudes § 6.9 cmt. d (stating an 

association's member has the burden of showing rules adopted under an 

express design-control power are unreasonable, and upon a prima facie 

showing, the burden shifts to the association to prove that the rules are fair 

and reasonable). Therefore, if Moretto makes a -satisfactory showing, the 

burden will shift to EPCC to establish that the rules are both fair and 

reasonable under all the circumstances. Id. 

Moretto's other arguments 

Moretto's complaint asserted four other claims for relief in 

addition to his claim for declaratory relief, including a claim that the 

Architectural Guidelines constitute a violation of his property rights. Other 

than the declaratory relief claim, Moretto's appeal challenges only the 

district court's dismissal of his violation of property rights claim as 

noncognizable. We disagree with the district court's conclusion that 

Moretto's claim is noncognizable. Courts are to analyze claims according to 

their substance regardless of their label. Otak Nev., LLC v. Eighth Judicial 

Dist. Court, 129 Nev. 799, 809, 312 P.3d 491, 498 (2013). Based on the 

foregoing, to the extent EPCC's Architectural Guidelines are determined 

unreasonable and thus beyond EPCC's authority, such restrictions would 

be a violation of Moretto's rights as an owner in the community and 

potentially would warrant relief if proven. Therefore, we reverse the 

district coures summary judgment with respect to this claim. We otherwise 

affirm the district coures summary judgment with respect to Moretto's 

other three claims not addressed on appeal. 

17 
CONCLUSION 

We expressly adopt sections 6.7 and 6.9 of the Restatement 

(Third) of Property: Servitudes. We conclude that, under the Restatement's 

approach, EPCC's bylaws provide it the express power to adopt designcontrol restrictions on individually owned property in the Elk Point 

cornmunity. Although EPCC possesses the authority to adopt designcontrol restrictions for individually owned property, it must exercise that 

power reasonably. Here, the parties did not address this issue below. Thus, 

we reverse the district court's order granting summary judgment in favor of 

EPCC with respect to Moretto's declaratory relief claim and violation-ofproperty-rights claim, and we remand for consideration of whether the 

Architectural Guidelines are reasonable in light of the discussion herein. 

• 

Cadish 

We concur: 

J. 

Silver 

Piekuur 

Pickering 

y J. 

18