IN THE COURT OF APPEALS OF NORTH CAROLINA

2021-NCCOA-209

No. COA19-976

Filed 18 May 2021

Mecklenburg County, No. 18 CVS 12903

C INVESTMENTS 2, LLC, Plaintiff,

v.

ARLENE P. AUGER, HERBERT W. AUGER, ERIC E. CRAIG, GINA CRAIG, 

LAURA DUPUY, STEPHEN EZZO, JANICE HUFF EZZO, ANNE CARR GILMAN 

WOOD, as Trustee of the FRANCIS DAVIDSON GILMAN, III TRUST fbo PETS UW 

dated June 20, 2007, LAUREN HEANEY, BRIDGET HOLDINGS, LLC, GINNER 

HUDSON, JACK HUDSON, CHAD JULKA, SABRINA JULKA, ARTHUR MAKI, 

RUTH MAKI, JENNIE RAUBACHER, MATTHEW RAUBACHER, as Co-Trustees of 

the Raubacher/Cheung Family Trust dated November 11, 2018, LAWRENCE 

TILLMAN, LINDA TILLMAN, ASHFAQ URAIZEE, JABEEN URAIZEE, JEFFREY 

STEGALL and VALERIE STEGALL, Defendants.

Appeal by defendants from judgment entered 8 April 2019 by Judge Charles 

M. Viser in Mecklenburg County Superior Court. Heard in the Court of Appeals 24 

September 2020.

Parker Poe Adams & Bernstein LLP, by Michael G. Adams and Morgan H. 

Rogers, for plaintiff-appellee.

Law Office of Kenneth T. Davies, P.C., by Kenneth T. Davies, for defendantsappellants Arlene Auger, Herbert Auger, Eric Craig, Gina Craig, Stephen Ezzo, 

Janice Huff Ezzo, Ashfaq Uraizee, and Jabeen Uraizee.

Tillman Wright, PLLC, by Chad D. Tillman and Jeremy C. Doerre, for 

defendants-appellees Lawrence and Linda Tillman.

Jordan Price Wall Gray Jones & Carlton PLLC, by H. Weldon Jones, III, for 

amicus curiae Community Associations Institute. 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

Offit Kurman, P.A., by Zipporah Basile Edwards, for amicus curiae North 

Carolina Land Title Association.

Law Office of Kenneth T. Davies, P.C., by Kenneth T. Davies; Robinson, 

Bradshaw & Hinson, P.A., by Richard A. Vinroot; and Nexsen Pruet, PLLC, by 

James C. Smith, for amici curiae C.E. Williams, III, et al.

Offit Kurman, P.A., by Amy P. Hunt and Robert B. McNeill, for amici curiae 

Michael and Karyn Reardon.

Roberson Haworth & Reese, PLLC, by Alan B. Powell and Andrew D. Irby, for 

amicus curiae Lori Postal.

Ball Barden & Cury P.A., by J. Boone Tarlton, and Roberts & Stevens, P.A., by 

Kenneth R. Hunt, for amici curiae Daniel Kayser et al.

DIETZ, Judge.

¶ 1 For much of our State’s history, a title search in North Carolina was a costly, 

often risky endeavor. Buyers—typically through their real estate attorneys—had to 

carefully comb back through deeds and other property records, sometimes going back 

for centuries, to ensure they found every recorded interest in the property, including 

things like easements and restrictive covenants attached to the land.

¶ 2 In the early 1970s, our State enacted the Real Property Marketable Title Act 

to simplify these title searches and reduce the costs they imposed on our society. Now, 

if a property owner has an unbroken chain of title dating back thirty years, earlier 

rights and interests in the land are extinguished, barring a few narrow exceptions.
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

¶ 3 This case involves one of these statutory exceptions. The Marketable Title Act 

does not extinguish a covenant that is part of a scheme of development and that 

restricts the property to residential use only, or more narrowly to multi-family or 

single-family residential use only. 

¶ 4 The parties in this case own property in a residential subdivision created in 

the 1950s. The lots are subject to a restrictive covenant limiting them to residential 

use only, as well as a number of other covenants that govern the number, size, 

location, and various design elements of structures located on each lot. The trial court 

entered a declaratory judgment holding that only the first covenant—the one 

restricting the properties to residential use—survives under the Marketable Title Act 

and that the remaining challenged covenants were extinguished. 

¶ 5 We affirm the trial court’s order. Applying the plain and unambiguous 

language of the Act, the covenants governing the type of structures that can be 

erected on the property, where they are located, and what they look like are not 

covenants concerning residential use or, more narrowly, multi-family or single-family

residential use. This is confirmed by long-standing precedent from our Supreme 

Court interpreting language in covenants nearly identical to those at issue in this 

case. 

¶ 6 Defendants urge this Court to depart from the Act’s plain language—to, in 

essence, rewrite the statute—because, in their view, our General Assembly could not 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

have intended this result. This is so, Defendants argue, because following the Act’s 

plain language would destroy the character of many older neighborhoods that have 

long been governed by these types of aging restrictive covenants. 

¶ 7 What Defendants ask of us is beyond the role of the judicial branch. We 

interpret statutes as they are written; we do not rewrite statutes to ensure they 

achieve what we believe is the legislative intent. If our interpretation of the plain 

language of a statute yields unintended results, the General Assembly can amend the 

statute to ensure it achieves the intent of the legislative branch of our government.

Facts and Procedural History

¶ 8 Country Colony is a residential subdivision in Mecklenburg County developed 

in the 1950s. In 1952, before selling any lots, the developer recorded nine restrictive 

covenants. The covenants limit the properties to residential use only and provide 

further restrictions on the number, size, location, and design elements of the 

structures located on each lot:

1. All lots in the tract shall be known and described and 

used for residential lots only.

2. No structure shall be erected, altered, placed or 

permitted to remain on any residential building plot 

other than one detached single-family dwelling not to 

exceed two and one-half stories in height and a private 

garage, and other outbuildings incidental to residential 

use of the plot.

3. No building shall be erected on any residential building 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

plot nearer than 100 feet to the front lot line nor nearer 

than 20 feet to any side line.

4. No noxious or offensive trade or activity shall be carried 

on upon any lot nor shall anything be done thereon 

which may be or become an annoyance or nuisance to 

the neighborhood.

5. No trailer, basement, tent, shack, garage, barn or other 

outbuilding erected in the tract shall at any time be 

used as a residence temporarily or permanently, nor

shall any structure of a temporary character be used as 

a residence.

6. No dwelling costing less than $10,000.00 shall be 

permitted on any lot in the tract. The ground floor area 

of the main structure, exclusive of one story open 

porches and open car ports, shall be not less than 1200 

square feet in case of a one story structure. In the case 

of a one and one-half, two or two and one-half story 

structure, the ground floor area of the main structure, 

exclusive of one-story open porches or open car ports, 

shall not be less than nine hundred square feet. (It 

being the intention to require in each instance the 

erection of such a dwelling as would have cost not less 

than the minimum cost provided if same had been 

erected in January, 1952.)

7. A right of way is and shall be reserved along the rear of 

each lot and along the side line of each lot where 

necessary, for pole lines, pipes and conduits for use in 

connection with the supplying public utilities service to 

the several lots in said development.

8. In the event of the unintentional violation of any of the 

building line restrictions herein set forth, the parties 

hereto reserve the right, by and with the mutual 

written consent of the owner or owners, for the time 

being of such lot, to change the building line restrictions 

set forth in this instrument; provided, however, that 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

such change shall not exceed ten percent of the original 

requirements of such building line restrictions.

9. None of the lots shown on said plat shall be subdivided 

to contain less than two acres, and only one residence 

shall be erected on each of said lots. 

¶ 9 Plaintiff is the owner of seven of the lots. Defendants are the owners of the 

other lots. Plaintiff brought a declaratory judgment action seeking to extinguish 

many of these covenants based on our State’s Marketable Title Act. The trial court 

entered summary judgment declaring that the first covenant, which restricts the lots 

to residential use, is enforceable but the remaining covenants challenged by Plaintiff 

are extinguished by operation of the Marketable Title Act. Defendants appealed.

Analysis

¶ 10 Under the common law, owners of real property acquired and held title to their 

real property subject to any covenants and other nonpossessory interests that 

appeared in their property’s chain of title. As a result, owners and prospective owners 

of real property, typically through their real estate attorneys, were required to trace 

the title to property back for centuries to ensure all enforceable interests in that 

property were identified. This was often a complicated and time-consuming process 

that injected significant cost, delay, and uncertainty into our State’s real property 

market. 

¶ 11 In 1973, our General Assembly passed the Real Property Marketable Title Act 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

to simplify title searches and render our State’s real estate more marketable. See N.C. 

Gen. Stat. § 47B-1 et seq. The Marketable Title Act functions by creating “marketable 

record title” to real property upon a showing of an unbroken, thirty-year chain of title 

to real property. Hill v. Taylor, 174 N.C. App. 415, 420–21, 621 S.E.2d 284, 288–89

(2005). Once the owner establishes marketable record title, the Act extinguishes “all 

rights, estates, interests, claims or charges whatsoever, the existence of which 

depends upon any act, title transaction, event or omission that occurred prior to such 

30–year period,” including restrictive covenants like the ones at issue in this case, 

unless those restrictive covenants fall within the exceptions to the Act contained in 

Section 47B-3. Id. (citing N.C. Gen. Stat. §§ 47B-2(c), 47B-3). 

¶ 12 The crux of this case is the proper interpretation of one of the exceptions in 

Section 47B-3, which provides that the Act does not extinguish a covenant applicable 

to a general or uniform scheme of development which restricts the property to 

residential use, or more narrowly to multi-family or single-family residential use:

Such marketable record title shall not affect or extinguish 

the following rights:

. . .

(13) Covenants applicable to a general or uniform scheme 

of development which restrict the property to residential 

use only, provided said covenants are otherwise 

enforceable. The excepted covenant may restrict the 

property to multi-family or single-family residential use or 

simply to residential use. Restrictive covenants other than 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

those mentioned herein which limit the property to 

residential use only are not excepted from the provisions of 

Chapter 47B.

N.C. Gen. Stat. § 47B-3(13).

¶ 13 The trial court declared that the first challenged covenant, providing that all 

“lots in the tract shall be . . . used for residential lots only” fell within the exception 

of Section 47B-3(13) and was not extinguished. The court declared that the other 

challenged covenants—those restricting the size and number of structures erected on 

lots, establishing setbacks on the property, barring further subdivision of lots, and 

imposing various other architectural limitations on structures built upon the lots—

did not fall within Section 47B-3(13) and were extinguished under the Act. 

¶ 14 On appeal, Defendants contend that the trial court erred in its interpretation 

of N.C. Gen. Stat. § 47B-3(13) and that all of the challenged covenants survive under 

this exception to the Marketable Title Act. We thus begin our analysis by interpreting 

the language of N.C. Gen. Stat. § 47B-3(13).

¶ 15 “The intent of the General Assembly may be found first from the plain 

language of the statute, then from the legislative history, the spirit of the act and 

what the act seeks to accomplish.” State v. Lemus, __ N.C. App. __, 848 S.E.2d 239, 

242 (2020). “But, if the statutory language is clear and unambiguous, then the 

statutory analysis ends and the court gives the words in the statute their plain and 

definite meaning.” Id.
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

¶ 16 Defendants argue that, under N.C. Gen. Stat. § 47B-3(13), if a collection of 

covenants governing a uniform scheme of development include a restriction on 

residential use only, the Marketable Title Act exempts all covenants applying to that 

uniform scheme of development. This is so, Defendants argue, because the phrase 

“which restrict the property to residential use only” modifies the immediately 

preceding phrase “general or uniform scheme of development”:

(13) Covenants applicable to a general or uniform scheme 

of development which restrict the property to residential use 

only, provided said covenants are otherwise enforceable. 

. . .

N.C. Gen. Stat. § 47B-3(13) (emphasis added).

¶ 17 The flaw in this argument is that the verb “restrict” is in its plural form, which 

means that, in the phrase “Covenants applicable to a general or uniform scheme of 

development which restrict the property to residential use only,” the phrase “which 

restrict” is modifying the plural “covenants” and not the singular “scheme of 

development.” We thus reject Defendants’ proposed interpretation and hold that this 

exception in N.C. Gen. Stat. § 47B-3(13) applies only to “covenants . . . which restrict 

the property to residential use only” and not to other covenants that are part of a 

general or uniform scheme of development and merely accompany a covenant 

restricting the property to residential use only. 

¶ 18 Defendants next argue that, even if the statute applies only to “covenants . . . 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

which restrict the property to residential use only,” that phrase should be read 

broadly to include accompanying covenants relating to the residential use of the 

property, such as those governing the size and number of structures erected on lots 

and imposing various architectural limitations on structures built upon the lots. 

¶ 19 But again, this proposed interpretation cannot be squared with the statute’s 

plain language. The next two sentences of N.C. Gen. Stat. § 47B-3(13) further define 

the types of covenants that are subject to the statutory exception and expressly state 

that the exception is limited solely to those covenants restricting property to 

residential use, or more narrowly to multi-family or single-family residential use, and 

that it does not apply to other, related covenants:

(13) Covenants applicable to a general or uniform scheme 

of development which restrict the property to residential 

use only, provided said covenants are otherwise 

enforceable. The excepted covenant may restrict the 

property to multi-family or single-family residential use or 

simply to residential use. Restrictive covenants other than 

those mentioned herein which limit the property to 

residential use only are not excepted from the provisions of 

Chapter 47B.

Id. (emphasis added).

¶ 20 By stating that the excepted covenant “may restrict the property to multifamily or single-family residential use or simply to residential use,” the statute 

indicates that it applies solely to these specific covenants, not to other, related ones 

that might accompany these specific covenants as part of a uniform scheme of 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

development. Defendants’ proposed interpretation would render the second sentence 

superfluous by broadening the exception for residential use to include many other 

forms of covenants. 

¶ 21 The same is true of the third sentence, which again expressly indicates that 

the statute should not be read broadly and that it excepts only those covenants “which 

limit the property to residential use.” Id. This language, too, would be superfluous if 

we adopted Defendants’ proposed interpretation. Settled principles of statutory 

construction require us to follow a statute’s plain language and avoid interpretations 

that render meaningless the words chosen by our legislature. State v. Beck, 359 N.C. 

611, 614–15, 614 S.E.2d 274, 277 (2005).

¶ 22 The dissent also contends that, by using the phrase “general or uniform scheme 

of development,” the General Assembly signaled that this provision might exempt 

covenants concerning how a planned community is developed, not merely how the 

properties within it are used. Thus, the dissent reasons, the phrases “residential use” 

and “multi-family or single-family residential use” are ambiguous and can be read 

more broadly than their plain language requires. But the limiting phrase “general or 

uniform scheme of development” serves a plain and unambiguous purpose: it restricts 

the exemption to these sorts of planned communities and not to a covenant attached 

only to a single property. There is nothing ambiguous about this statutory language.

¶ 23 Accordingly, we reject Defendants’ arguments and hold that the exception in 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

Section 47B-3(13) applies only to covenants applicable to a general or uniform scheme 

of development that either restrict the property to residential use only, or more 

narrowly restrict the property to multi-family or single-family residential use only.

¶ 24 Having interpreted this provision of the Marketable Title Act, we turn to its 

application in this case. We agree with the trial court that the first covenant, stating 

that all “lots in the tract shall be . . . used for residential lots only” survives under the 

Marketable Title Act. The parties concede that all of the challenged covenants are 

ones applicable to a general or uniform scheme of development. This particular 

covenant restricts the properties to residential use only. It is therefore excepted from 

extinguishment under the Marketable Title Act by the plain terms of Section 47B3(13). 

¶ 25 We likewise agree with the trial court that the remaining challenged covenants 

are not subject to the exception in Section 47B-3(13) and are extinguished. Most of 

the provisions in these covenants quite plainly fall outside the exception: the setback 

requirements, the restrictions on subdividing lots, and the various architectural 

limitations. None of these provisions restrict the property to residential use, or more 

narrowly to multi-family or single-family residential use, and therefore are 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

extinguished.1

¶ 26 Two remaining provisions in the challenged covenants merit further analysis: 

(1) the provision that “No structure shall be erected, altered, placed or permitted . . . 

other than one detached single-family dwelling” and (2) the provision that “only one 

residence shall be erected on each of said lots.” Defendants contend that these two 

restrictions, in effect, limit the property to single-family use. But again, Defendants’ 

argument cannot be squared with the language carefully chosen by our General 

Assembly.

¶ 27 The General Assembly could have stated that covenants restricting property 

to single-family or multi-family use and covenants restricting property to singlefamily or multi-family structures both survive under the Marketable Title Act. But 

that is not what the legislature said. The Act does not save covenants addressing the 

type of structure on property; it saves only those covenants restricting how that 

structure is used:

Such marketable record title shall not affect or extinguish 

the following rights:

. . .

 

1 The Marketable Title Act contains other exceptions, some of which arguably could 

apply to certain covenants challenged in this case, such as the seventh covenant concerning

a right of way for utility lines, pipes, and conduits for public utilities. The parties in this 

appeal addressed only the exception in N.C. Gen. Stat. § 47B-3(13) and we therefore limit our 

appellate review solely to those arguments. See N.C. R. App. P. 28(b)(6).
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

(13) Covenants applicable to a general or uniform scheme 

of development which restrict the property to residential use 

only, provided said covenants are otherwise enforceable. 

The excepted covenant may restrict the property to multifamily or single-family residential use or simply to 

residential use. . . .

N.C. Gen. Stat. § 47B-3(13) (emphasis added).

¶ 28 Turning to the covenant barring any structure “other than one detached singlefamily dwelling,” we conclude that this covenant restricts the type of structure 

erected on the property and says nothing about how that structure is used. 

¶ 29 We know this because our Supreme Court has held it. See J. T. Hobby & Son, 

Inc. v. Fam. Homes of Wake Cty., Inc., 302 N.C. 64, 74–75, 274 S.E.2d 174, 181 (1981). 

In Hobby, there were two relevant covenants governing the residential subdivision in 

the case: one stating that no lot “shall be used except for residential purposes” and 

another stating that no “building shall be erected . . . other than one detached singlefamily dwelling.” Id. at 65–66, 274 S.E.2d at 176. The defendants, who operated a 

family care business, bought a home in the subdivision and converted it for multifamily use by four special needs adults and their care staff. Id. at 72, 274 S.E.2d at 

179–80. The Supreme Court held that this was consistent with both covenants: the 

family care home was used for residential purposes, thus complying with the first 

covenant, and the building itself was a single-family dwelling, thus complying with 

the second covenant. Id. at 74–75, 274 S.E.2d at 181. Critically important for this 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

case, the Supreme Court held that the covenant’s language restricting the property 

to “one detached single-family dwelling” did not limit the use of that dwelling to a 

single family. Id.

¶ 30 Here, too, a resident of this subdivision could convert their single-family 

dwelling for multi-family use without running afoul of the language in this covenant. 

The covenant restricts the property to one “detached single-family dwelling,” a 

restriction on the structure. It does not “restrict the property to multi-family or singlefamily residential use or simply to residential use.” N.C. Gen. Stat. § 47B-3(13). So, 

under the plain terms of the Marketable Title Act, it is extinguished.

¶ 31 We next turn to the covenant stating that “only one residence shall be erected 

on each of said lots.” Again, this covenant governs how many structures can be 

erected on a lot, not how they are used. And, again, we know this because our 

Supreme Court has held it. Huntington v. Dennis, 195 N.C. 759, 760–61, 143 S.E. 

521, 521–22 (1928). In Huntington, the Court held that an apartment complex with 

many separate apartments is a single “residence” for purposes of a covenant stating 

that “[a]ny residence erected on the property shall cost not less than $7,500.” Id. The 

covenant in this case stating that “only one residence shall be erected on each of said 

lots,” like the similar covenant in Huntington, only restricts the number of structures 

erected on the property; it does not restrict whether that structure is for single-family 

or multi-family use. 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

¶ 32 Defendants urge this Court to ignore the statute’s plain language because 

applying that plain language to these two covenants “would destroy the common 

scheme of development for Country Colony, stripping the neighborhood naked, with 

only the ‘fig leaf’ of the residential use covenant.” This, Defendants contend, “could 

not have been the intent of the legislature, or it would, and could, have said so 

expressly.”

¶ 33 This reasoning reveals the ultimate flaw in Defendants’ argument—the 

legislature did say so expressly, in the words they chose when they crafted the 

statute. The role of the courts is to interpret statutes as they are written. We do not 

rewrite statutes to ensure they achieve what we, or the parties in a lawsuit, imagine 

are the legislature’s policy goals. Sykes v. Vixamar, 266 N.C. App. 130, 138, 830 

S.E.2d 669, 675 (2019).

¶ 34 Now, to be sure, if the plain reading of a statute leads to a result so absurd that 

no reasonable legislator could have intended it, we can ignore that absurd 

interpretation and find a reasonable one. Mazda Motors of Am., Inc. v. Sw. Motors, 

Inc., 296 N.C. 357, 361, 250 S.E.2d 250, 253 (1979). But the plain language of the 

Marketable Title Act is not absurd. There are countless reasons why rational 

legislators might have wanted to preserve restrictions on use but not restrictions on 

structure—not least of which is that the original proposal for our State’s Marketable 

Title Act might have included exemptions for both structure and use, but the General 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

Assembly only had the votes to enact a bill focusing on use. 

¶ 35 And even if we, as judges, agreed with Defendants that the legislature might 

have intended something other than what the plain language provides, we would still 

follow the statute’s language. As this Court succinctly explained in a similar dilemma 

several years ago, we have “two choices: (1) we can apply the plain language and 

settled canons of statutory construction, which results in a statutory interpretation 

that the legislature may not have intended; or (2) we can interpret the statute in the 

way we, as judges, think the legislature intended, which may also result in a statutory 

interpretation that the legislature may not have intended.” Wells Fargo Bank, N.A. 

v. Am. Nat’l Bank & Tr. Co., 250 N.C. App. 280, 287, 791 S.E.2d 906, 911 (2016). “The 

choice,” as we held in Wells Fargo, “is obvious.” Id. “We will not speculate about what 

we think the legislature intended; we will apply the plain language and applicable 

statutory canons and, if the result is unintended, the legislature will clarify the 

statute.” Id.

¶ 36 The dissent also emphasizes that courts do not construe statutes in favor of 

unrestricted use of land, as we are required to do with covenants. This is correct; we 

construe statutes by examining the words of the statute. The dissent struggles to 

understand why our General Assembly chose the words it used—in particular, the 

words “residential use” and “multi-family or single-family residential use.” But our 

task is not to speculate about why the legislature chose particular words, but to 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

interpret those words according to their plain meaning and ordinary usage. Raleigh 

Hous. Auth. v. Winston, 2021-NCSC-16, ¶ 8. The dissent also suggests that the 

Supreme Court, by affirming the dissent in Winding Ridge, held that the words 

“residential use” and “multi-family or single-family residential use” are ambiguous. 

But Winding Ridge holds precisely the opposite—that there is nothing ambiguous 

about words “restricting the type of occupancy or use that may be made of the 

dwelling.” Winding Ridge Homeowners Ass’n, Inc. v. Joffe, 362 N.C. 225, 657 S.E.2d 

356 (2008), reversing for reasons in dissent, 184 N.C. App. 629, 640, 646 S.E.2d 801, 

808 (2007). The ambiguity in Winding Ridge arose because the covenants’ headings

purported to address “Use Restrictions” and “Use of Property,” but the covenants 

themselves focused “exclusively on construction and other structural concepts” and 

not on use. Id.

¶ 37 Finally, our analysis, unlike that of both Defendants and our dissenting 

colleague, is consistent with the stated intent of the Act. The General Assembly 

explained in the Act that “Land is a basic resource of the people of the State of North 

Carolina and should be made freely alienable and marketable so far as is practicable”; 

that “Nonpossessory interests” in real property “often constitute unreasonable 

restraints on the alienation and marketability of real property”; and that “Such 

interests . . . are prolific producers of litigation to clear and quiet titles which cause 

delays in real property transactions and fetter the marketability of real property.” 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

N.C. Gen. Stat. § 47B-1. Then, the legislature declared that the Act “shall be liberally 

construed to effect the legislative purpose of simplifying and facilitating real property 

title transactions by allowing persons to rely on a record chain of title of 30 years as 

described in G.S. 47B-2, subject only to such limitations as appear in G.S. 47B-3.” Id.

§ 47B-9.

¶ 38 So a key stated purpose of the Marketable Title Act is to make it easy for 

anyone buying real property to know precisely what covenants and other 

nonpossessory restrictions are, and are not, attached to the property. This, in turn, 

encourages the marketability of our State’s real property. Defendants’ interpretation 

would do the opposite. If we adopted Defendants’ strained interpretation, real 

property purchasers could not be certain what they were getting. There would be a 

chance that some judge out there somewhere could be persuaded that a covenant, 

even if not covered by the Act’s plain language, was close enough to survive. There 

would be “prolific producers of litigation” and “delays in real property transactions” 

and burdens on “the marketability of real property.” Id. § 47B-1. There would be 

everything the legislature expressly set out to prevent. 

¶ 39 Simply put, we reject Defendants’ (and the dissent’s) invitation to trek into the 

minds of the legislature and rewrite the statute. The Marketable Title Act is clear 

and unambiguous. Under N.C. Gen. Stat. § 47B-3(13), the covenants that survive are 

those “applicable to a general or uniform scheme of development” that “restrict the 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Opinion of the Court

property to multi-family or single-family residential use or simply to residential use.” 

That’s it. Anything else is gone. 

¶ 40 This means, as the trial court properly held, that the only covenant in this case 

that survives is the first one, stating that all “lots in the tract shall be . . . used for 

residential lots only.” The other challenged covenants are extinguished.

Conclusion

¶ 41 We affirm the trial court’s judgment.

AFFIRMED.

Judge INMAN concurs.

Judge DILLON concurs in part and dissents in part with separate opinion.
No. COA19-976 – C Invs. 2, LLC v. Auger

DILLON, Judge, concurring in part, dissenting in part.

¶ 42 The appeal concerns Country Colony’s thirteen (13) private restrictive 

covenants. But we are not being asked to interpret those covenants; there is no 

argument between the parties as to their meaning. Rather, we are called upon to 

interpret a provision in our General Statutes, specifically N.C. Gen. Stat. § 47B-3(13) 

(2018), a provision that excepts certain private restrictive covenants from being 

extinguished by operation of our Real Marketable Title Act. This provision saves 

from the Act’s operation:

Covenants applicable to a general or uniform scheme of 

development which restrict the property to residential use 

only, provided said covenants are otherwise enforceable. 

The excepted covenant may restrict the property to multifamily or single-family residential use or simply to 

residential use. Restrictive covenants other than those 

mentioned herein which limit the property to residential 

use only are not excepted from the provisions of Chapter 

47B.

N.C. Gen. Stat. § 47B-3(13).

¶ 43 I agree with the majority that this statutory provision saves the first private 

restrictive covenant at issue in this case, which states that the lots in Country Colony 

“shall be . . . used for residential lots only.”

¶ 44 But, unlike the majority, I also conclude that the statutory provision—

specifically the portion of the second sentence which saves private covenants which 

“restrict the [burdened] property to . . . single-family residential use”—covers the 

portions of Country Colony’s second and ninth covenants, which restrict the use of 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

each lot to a single-family residential structure. In other words, I conclude that the 

above statutory language describes both structural covenants and occupancy 

covenants; that is, occupancy covenants which limit the use of property to occupancy 

by a single family and structural covenants which limit the use of property to the 

development of a single-family type residential structure. Accordingly, on this point, 

I dissent.

¶ 45 In determining whether subsection (13) covers the covenants restricting the 

use of the lots to single-family type structures, we must be mindful that we are 

interpreting the words of a statute enacted by our General Assembly and not the 

words of a private restrictive covenant. It is true that, whether interpreting a statute 

or a private covenant, our goal is to discern the intent of the drafter.2 However, when 

the words used by the drafter are ambiguous (capable of more than one meaning), 

rules for interpreting a statute differ from rules for interpreting a private restrictive 

covenant.

¶ 46 Specifically, our Supreme Court mandates that ambiguities in the text of a 

private restrictive covenant must be resolved in favor of the unrestrained use of the 

real estate burdened by the covenant, based on the policy that private restrictions 

 

2 See State v. Rankin, 371 N.C. 885, 889, 821 S.E.2d 787, 792 (2018) (“The goal of 

statutory interpretation is to determine the meaning that the legislature intended upon the 

statute’s enactment.”).
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

which burden the use of land are generally disfavored:

We begin our analysis of this case with a fundamental 

premise of the law of real property. While the intentions of 

the parties to restrictive covenants ordinarily control the 

construction of covenants . . . such covenants are not 

favored by the law . . . and they will be construed to the end 

that all ambiguities will be resolved in favor of the 

unrestrained use of land.

J.T. Hobby & Son, Inc. v. Family Homes of Wake Cty., Inc., 302 N.C. 64, 70, 274 S.E.2d 

174, 178 (1981) (citations omitted).

¶ 47 Our Supreme Court, however, mandates a different rule when construing the 

words in an ambiguous statute. We do not construe ambiguous statutory provisions 

strictly, as we would the words in a private restrictive covenant, but rather:

[In] ascertaining the intent of the Legislature in cases of 

ambiguity, regard must be had to the subject matter of the 

statute, as well as its language, i.e., the language must be 

read not textually, but contextually, and with reference to 

the matters dealt with, the objects and purposes sought to 

be accomplished, and in a sense which harmonizes with the 

subject matter.

Victory Cab Co. v. Charlotte, 234 N.C. 572, 576, 68 S.E.2d 433, 436 (1951) (emphasis 

added); see also Rankin, 371 N.C. at 889, 821 S.E.2d at 792 (“The intent of the General 

Assembly may be found first from the plain language of the statute, then from the 

legislative history, the spirit of the act and what the act seeks to accomplish.”).

¶ 48 The majority correctly points out that our Supreme Court has repeatedly held 

that private restrictive covenants limiting a lot to a single-family structure will not 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

be construed to limit the occupancy use of that structure—that is, a private covenant 

restricting property to a single-family type structure will not be construed to prevent 

members of different families from using the structure at the same time. See, e.g., 

Winding Ridge v. Joffe, 362 N.C. 225, 657 S.E.2d 356 (2008) (adopting per curiam the 

dissenting opinion in 184 N.C. App. 629, 646 S.E.2d 801 (2007)); Hobby, 302 N.C. at 

74-75, 274 S.E.2d at 181-82. But in Winding Ridge and Hobby, our Supreme Court 

held in each case that the covenant language at issue was ambiguous and then 

resolved the ambiguity by applying the rule “that any doubt arising or ambiguity 

appearing [in a covenant] will be resolved against the validity of the restriction[.]” 

Edney v. Powers, 224 N.C. 441, 443, 31 S.E.2d 372, 374 (1944).

¶ 49 For instance, in Hobby, our Supreme Court explained:

We disagree with the position taken by plaintiffs [who were 

seeking a broad interpretation of the covenants] for several 

reasons.

First, plaintiffs’ position is inconsistent with one of the 

fundamental premises of the law as it relates to restrictive 

covenants: Such provisions are not favored by the law and 

they will be construed to the end that all ambiguities will 

be resolved in favor of the free alienation of land.

While it is possible that a restriction as to the type of 

structure would, in some instances, limit the character of 

the type of usage to which the building is employed, we 

conclude that such is not necessarily the case.

Hobby, 302 N.C. at 74, 274 S.E.2d at 181. And in Winding Ridge, our Supreme Court 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

adopted the reasoning of the dissenting judge in our Court, who reasoned:

In any event, in light of Hobby [and another case], the 

restrictive covenant in this case is at best ambiguous. It 

cannot be viewed as being “clearly and unambiguously 

drafted,” as required by Hobby. In the absence of the 

requisite clarity, the ambiguity must be resolved in favor 

of free use of property.

Winding Ridge, 184 N.C. App. at 641, 646 S.E.2d at 809 (citation omitted).

¶ 50 However, Hobby and Winding Ridge are not directly on point, as those cases 

concern the interpretation of ambiguous private restrictive covenants, not of an 

ambiguous statute. Notwithstanding, the reasoning in those decisions does suggest 

that Chapter 47B-3(13) is ambiguous. Indeed, Winding Ridge stands for the 

proposition that language referring to the “use of the ‘property,’ [is a] concept equally 

consistent with both structural and occupancy restrictions.” Id. at 641, 646 S.E.2d at 

809. Therefore, the language in Chapter 47B-3(13) referring to covenants restricting 

property to single-family residential use is equally consistent with both structural 

and occupancy restrictions.

¶ 51 We must, therefore, look to the context and subject matter of the statute to 

determine whether our General Assembly intended “single-family residential use” to 

be read narrowly, to include only covenants restricting how structures are occupied, 

no matter their design, or whether our General Assembly intended that phrase to be 

read more broadly to also include structural covenants (i.e., covenants restricting the 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

use of the property itself to single-family residential structures).

¶ 52 Again, our Supreme Court instructs that “regard must be had to the subject 

matter of the statute.” Victory Cab, supra. And in my view, the subject matter of 

Chapter 47B-3(13) strongly suggests that our General Assembly was, at least in part, 

concerned with protecting covenants restricting the type of structures developed, as 

the statutory provision is expressly limited in application to “[c]ovenants applicable 

to a general or uniform scheme of development[.]”

¶ 53 Also, the statute speaks of covenants restricting how “the property” is used, 

not merely how “the structures” on those properties are used. As explained in 

Winding Ridge, a covenant restricting a “property” to “residential use” could 

reasonably be read to include, not only occupancy restrictions, but also structural 

restrictions.

¶ 54 Further, the second sentence in Chapter 47B-3(13), contextually, suggests that 

the General Assembly was concerned, at least in part, with saving structural 

restrictions. For instance, this sentence which preserves “single-family residential 

use” covenants also preserves “multi-family [] residential use” covenants. In my view, 

“multi-family [] residential use” covenants most logically include structural 

restrictions which only allow multi-family type buildings (duplexes, quadruplexes, 

and the like) and prohibit single-family residential type structures. Covenants 

requiring multi-family structures are much more prevalent. I am unaware of any 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

private covenant in North Carolina (though they might exist) that restricts the 

occupancy of a structure to multi-family use, irrespective of the type of structure 

placed on the property. Indeed, an owner of a duplex subject to a multi-family 

“occupancy” covenant would be in violation whenever there was a vacancy, as during 

those times, the duplex structure would only be occupied by a single family. By 

preserving “multi-family” use covenants, it is logical to surmise that our General 

Assembly had structural covenants in mind.

¶ 55 I do agree with the majority that our goal is to construe the statute as written

and not read in language that is not there. But I am not reading in any language, as 

covenants restricting the use of property is “a concept equally consistent with both 

structural and occupancy restrictions.” Winding Ridge, supra. It certainly could be 

argued that the better policy would be to favor protecting all the Country Colony 

covenants, to better preserve the character of this older neighborhood. But we are 

not the General Assembly, and Chapter 47B-3(13) could not be clearer: “Restrictive 

covenants other than those mentioned herein which limit the property to residential 

use only are not excepted from the provisions of Chapter 47B.” Accordingly, I agree 

with the majority that the remaining Country Colony covenants, for instance the 

covenant limiting the size of each lot, are not protected by Chapter 47B-3(13).

¶ 56 This is not to say that our General Assembly forbids older neighborhoods from 

retaining their character. Indeed, that body has provided a means within the Act by 
C INVS. 2, LLC V. AUGER

2021-NCCOA-209

Dillon, J., concurring in part, dissenting in part.

which a lot owner in an older neighborhood may preserve all covenants. Specifically, 

Section 47B-4 allows any lot owner in an older neighborhood with covenants about to 

expire by operation of the Act to preserve all the covenants for another thirty (30) 

years. They do this by simply filing a notice of the covenants in the county’s register 

of deeds, naming the other lot owners as grantees (so that the notice of the covenants 

will be discovered during a title search of any of the neighborhood lots going back 

thirty (30) years). It is simply that our General Assembly has chosen to favor the 

policy purposes of the Act—to simplify title searches—over the preservation of most 

types of restrictions which create uniformity within a neighborhood, but which do not 

appear recently in the chains of title.