RENDERED: SEPfEMB_ER 28, 2017 TO BE PUBLISHED

2016-SC-00213-DG
MAJESTIC OAKS HOMEOWNERS 'ASSOCIATION, INC.
ON REVIEW FROM COURT OF**APP~ALS** · 

## v. CASE NO. 2014-CA-000492
.**SHE~BY** CIRCUIT COURT NO. 2009-CI-00873

. . MAJESTIC OAKS FARMS,.INC., JOSEPH O'BRIEN. AND ASHLYN O'BRIEN APPELLANT

APPELLEES

OPINION OF THE COURT BY CHIEF JUSTICE MINTON REVERSING AND REMANDING Kentucky law confirms the possibility ofa defeasible easement, although the term itselfappears in no reported case describing this·type ofeasement, which is an easement capable oftermination upon the occurrence ofa specified event or contingency. In this case, Majestic Oaks Homeowners Association (HOA) contends the**d~feasible** .easement principle applies to the easement for ingress and egress retained by its subdivision's developer, Majestic Oaks Farnts (Developer), to terminate it when a majority ofHOA members voted to do so, as allowed by the express terms.ofDeveloper's recorded subdivision plat. On
. discretionary review, we agree with HOA.I. FACTUAL AND PROCEDURAL BACKGROUND. ln 1995, Developerbegan developing a residential subdivision,**Maj~stic** Oaks Equestrian Estates (Estates). To memorialize Developer's andfut:ure homeowners' rights in Estates, Developer.recorded with its subdivision plat a declaration ofcovenants, conditions, and restrictions (Original Declaration) and incorporated its terms into the homeowners' deeds to**lot~** in the development. The Original Declaration accomplished two noteworthy things
.. First, the Original Declaration created Developer's easement in gross, stating, "[Developer] shall have a superior right and·easement in gross [to use

.Estates's private roads]
...for so long as [Developer], its successors or assigns,
owns any Lot or any portion ofthe Property." The Original Deelaration defined

· Lotas "any Lot which is part ofthe Property:" 

### Property was defined as "Lots 1-

23 as shown on the above referenced Plat." Additional lots could be addedas part ofProperty, according to the following language: "[Developer] intends to make this section containing 23 lots a part ofa larger community known as [the Estates], having been developed in accordance with current plan. Subsequent additional plats will be recorded in the office ofthe Shelby County Clerk's Office." Second,§ 8.3 ofthe Original Declaration, the other section at the center ofthis dispute, states: 

### Unless cancelled, altered oramendedunder the provisions ofthis paragraph, these 

### covenantS and restrictions are to run with the land**~d** shall be binding on all parties claimingunder them
...unless an instrument signed by a majority ofthe then owners ofall lots subject to these restrictions has been recorded 2 \

### agreeing to change these restrictions and covenants in whole or in part. These 

### restrictions·may be cancelled, altered oramended at any time by a 67% approval from each class ofmembership subject to these restrictions, 

### butDevelopershall retain.the sole right to appoint the architectural approval committee until the last lot is sold.I In 1998 and 2000, Developer e:Xpanded Estates to inciude Lots 24-59, ( identified as "Sections 2 and**3,'~** byrecording a plat. The plat for Section 3 also.

. . identified a section ofland for "Future Developinent," identified as "Sections 4 and 5." Bythis time, Estates .included Lots 1-59; identified as "Sections 1-3." By March 13, 2006, Developer no longer owrted any property in the**Estat~s,** having transferred Sections 1-3 to individual homeowners within the HOA through a quitclaim deed, but bontinued to own Section 4. Section 4 did not become.part ofEstates until April 2008, two years after all ofDeveloper's then-

. . existing propertyin the Estates was originally conveyed. In August 2006, HOA proposed amendments to the Original Declaration to be voted on bythe homeowners, proposing_two relevant changes: (1) to expahd "Property'' to include Lots 1-59, i.e. Seetions 1-3 ofthe Estates; and (2) to remove the language granting an easement in gross to Developer_. The amendment to remove this language passed with-82% approval, well above the 67% required_ by the Original Declaration. 2

r Emphasis has been added to highlight the**import~t** language.
. 2 Because we ultimately conclude that Developer:'s easementwas expressly made terminable and that the easement terminated when the HOA membership**vot~d** decisively inAugust**2006~** we consider Developer's argument ofthe possible legal effect ofits continued ownership ofSection 4-the effective date ofits inclusion in Propertybeing disputed-is not a material fact that precludes summaryjudgment in favor ofHOA. · · 3Believing the easeme.nt to be ineffective, HOA filed suit in circuit court against Developer to stop Developer's continued use ofthe purportedly terminated easement in· gross l;>ecause ofthe adoption by HOA of**th~** · amendment to the Original Declaration arid the relinquishment by Developer of any ownership rights in "Property'." Both parties filed summaryjudgment motions against each other, with the trial court granting Developer's motion and a panel ofthe Court ofAppeals affirming. We granted HOA's motion for discretionary review. II. ANALYSIS. A. Standard

## or Review.

·"The standard ofreview on appeal ofa summaryjudgment is whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving partywas.entitled tojudgment as a matter oflaw."3 "An appellate court need not defer to the trial court's decision on summary judgment and will review the issue de novo**beca~se** only legal questions and
no factual findings are involved."4 B. The Possessory Interest Granted to Developer was a Defeasible Easement in Gross that Terminated Upon a Q:reater Than 67% Vote, Sufficiently Fulf"illing a Condition for Termination Stated in the Written Docum.ent Granting the Easement. An easement "is an incorporeal hereditament to which corporeal property is rendered subject."5 In otherwords, it is the right to use the land owned by ) 3 Coomerv. CSX Tran.Sp., Inc.,'319 S.W;.3d 366, 370 (Ky. 2010) (citing Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996)).
. 4 Id. at 370-71 (citing Hallahan v..The·**Courier-Jouma~** 138 S.W.3d 699, 704 (Ky. App. 2004)).
. . . : s Illiilois Cent R.R. Co. v. Roberts, 928 S.W.2d 822, 826 (Ky. App. 1996) (citing Henry Bickel Co. v. Texas Gas Transmisswn Corporation, 336 S.W.2d 345, 347 (Ky. 1960). 4someone else for a specified P.lirpose. "An easement in gross is_

## amere personal interest in orright to use the land ofanother. It is attached to and vested in, the person to whom it is granted."6 "[T]he principal distinction**between~** easement in gross and

## an easement appurtenant is that in the first there is not, and in the second there is, a dominant tenement to which it is attached."7 "An express easement**i~** created by a written grant with.the formalities ofa. deed."8 There is no question in this case that whatever right Developer has in the real propertyit conveyed to HOA ofan express easement in gross. And·the disagreement between the parties rests on whether that express**ea~ement** in gross is legally capable oftermination and whetherHOA actually terinihated it. A defeas1.ble easement is one that "terminate[s] upon the oqcu:i:rence ofa given event."9 ."[A]n easementmay be expressly subject to termination by the servient ownerupon the·occurrence ofa specified event or contingency."io "Where an easement has been created until the happening of

## a specific event. or contingency, the easementwill terminate ipso facto on the happening ofthe specified eveni.or contingency."11

6 Meade 

## v. Ginn, 159 S.W.3d 314, 320 (Ky. 2004): 1 Id. s Sawyers v. Beller, 384 S.W.3d 107, 111 (Ky. 2012). · . 9 Jon W. Bruce and James W. Ely, Jr., The Law ofEasements & Licenses in Land,§ 10:3 (1988).
. io 25 Am. Jur. 2d Easements & Licenses§ 84 (2014). 11 Id. 5Kentucky has never formally recognized the term 

### def easible easements. But two cases confirm the existence ofdefeasible easements in Kentucky;1'2 In 

### Kenner, the Court stated: The doctrine is well-settled at common law that no·freehold or fee-·**simpl~** estate can be destroyed bythe breach or non..:performance ofa condition subsequent
...This common-law rule does not apply, however
...tothe creation ofmere easements. [A]n incorpore8.l hereditament is not**cre~ted** at common lawby liyery of seizin; and whenever the breach ofa subsequent condition happens in an estate or grant ofthis character the estate terminates without any entry. 13 Ascertained from the language above, this Court recognized the exis_tence ofdefeasible easements in Kentucky in 

### Kenner. In Otter, the entire discussion ofthe Court ceri;.ered on whether an easement purporting to end when a water storage tank owner "remove[d] said tank" ended when the owner simplyreplaced the tank. 14 The Court could not have even entertained this discussion had it not**·assu~ed** the

### reco~ition of

### defeasibl~ easements in Kentucky. So according to 

### Kenner and Otter, Kentucky recognizes the existence ofdefeasible easements,**easem~nts** endingupon the occurrence ofa given event. Although this dispute involves.two such events, termination ofthe easement upon vote of.the individual homeowner members ofthe HOA conclusively decides this matter.·

· 12 Kenner v. American ContractCo., 72 Ky. 202 (Ky. 1872); Louisville Chair & Furniture Co. v. Otter, 294 S.W. 483 (Ky

..1927). 13 Kenner, 72 Ky. at 207-08. 14 Otter, 294 S.W. 

## at 483-87. 6"In the case ofan eXpress easement...the terms of [an ec:i-sement] determine the rights and liabilities ofthe parties."is "[B]ecause [the] contract created the easement, that contract also defines the extent ofthe easement."16 A trial court "commit[s] an errorwhen it [goes] outside the easement agreement to ascertain extraneously its meanln.g and effect, because the result [is] an interpretation ofthe instrument inconsistent with the clear and definite language employed in it."17 Taking these rules together, the extent ofDeveloper's rights as to its easement is confined by the very language it chose in retaining that easement.·

, The Onginal Declaration states, "These restrictions may be cancelled, altered or

amended at any time 

### by a 

### 67% approval from each class ofmembership subject to these restrictions, but [Develop'er] shall retain the sole right to appoint the architectural approval committee until the last lot is sold." No dispute exists as to the procedural validity ofthe vote itself-both parties agree

·that the vote was conducted properly. So, because the existence ofDeveloper's

easement is li:r:nited byits granting language in the Original Declaration, and

1s Sawyers v. Beller, 384 S.W.3d 107, 111 (Ky. 2012) (citing Tex. E. Transmission Corp. v. Carman, 314 S.W.2d 684, 687 (Ky, 1958)). 16 Chancy v. Chancy Lake Homeowners Association, 55 So.3d 287, 297 (Ala. Civ. App. 2010) (citing RomarDev. Co. v. GulfViewMgmt. Corp., 644 So.2d 4p2, 465 (Ala. 1994)). Chancy, although only persuasive authority, is the subject ofmuch debate between the parties and lower courts. The lOwer courts seem to have missed an important factual distinction between Chancyand this case that shows that Char.i.cy does not in fact support Developer's position. The .Chancycourt did not allow the homeowners' association in that case to amend the easement because Chaney's easement-granting document did not contain any sort oflimitation or amendment

.language. Chancy, 55 So.3d at 297. Rather, in this case, the Original Declaration, the

easement-granting document, allows for the a.I!lending ofthe "restrictions" ofthe Original Declaration.. · · · 11 Texas Eastern Cqrp. v. Carman, 314 S.W.2d 684,-687 (Ky. 1957). 7because HOA validly abided bythe procedure necessary to remove that easement, HOA extinguished Developer's easement. Developer argues that HOA's ability to amend .the Original Declaration is
.. confined to "restrictions," and not "covenants anc:i restrictions," per the language used in § 8.3 ofthe Original Declaration. And Developer argues that the term 

### easementdoes not fit under the umbrella ofeither "covenants" or "restrictions." alack's Law Dictionary, specific to property**law~** defines 

### Qffirmative covenantas ".[an] agreement that real property will be used in a certain way."18 An**~asement** constitutes a**coven~t** because an easement, as stated earlier, is
an interest that can be created by an agreement and**th~t**·allows a landowner to
use lan,d that he or she does own for a specific purpose. So an 

### easementfalls under the 

### covenants umbrella in the Original Declaration. To Developer's point, it is·true tJ:?.at this Court would_ be hard-pressed to refer to any easement, besides a negative easement, as a 

### restriction. But the language of§ 8.3 ofthe Original Declaration, in addition to interpretative

. . canons, supports our conclusion that an 

### easementfalls under the 

### restrictions

· umbrella ofthe Original Declaration. The applicable section,§ 8.3, begins by stating, 

### "Unless cancelled, altered
oramendedunder the provisions ofthis paragraph, these 

### covenants and restrictions shall be binding
...." This opening1anguage implies nothing less than covenants, and thus:easements, are. amendable. The language of§ 8.3 ,
is Black's Law Dictionary (10th ed. 2014). 8also states, "
...unless an instrument signed by a majority ofthe then owners of all lots subject to these restrictions has been recorded agreeing to change these restrictions and covenants in whole orin part." Again, this language implies that covenants are amendable. The section then describes an amendment-voting process: ''These restrictions may be cancelled, altered_oramended at any time by a 67% approval from each Class ofmembership subject to these restrictions, but Developers shall retain the sole rightto appoint the architectural approval

. . committee until the last lot is sold." We read this language more**as~** description ·ofthe amendment process than as**~.limitation** on what can be amended, considering the entirety ofthe section. 19 Even more in support of this reading is the.discussionofDeveloper's "sole rightto appoint the architectural approval committee
...." IfDeveloper truly intended to restrict application ofthe amendment process only to_ "restrictions," it would not have induded, in the same sentence, a discussion ofDeveloper's "rights;" Developer's rights including the use ofthe easement. Additionally,§ 8.3 is

. . located uri.der Art. VIII

- General Provisions in a document entitled "Declaration ofCovenants, Conditions and Restrictions." So this amendment provision seemingly generally applies to the_ability ofHOA to amend covenants, conditions, and restrictions.

19 Vansant v. Co.;,,_rrwnwealth, 224 S:W. 367, 371 (Ky. 1920) ("the meaning ofa word maybe ascertained byreference to the meaning ofwords associa,.tedwith it"). 9

/Lastly, this Court follows the contract interpretation canon historically known by the useful Latinism, 

### conf!aproferentem_:.When interpreting_contracts susceptible to two meanings, we construe ambiguity.against the drafter, Developer in this case.20 IfDeveloper wanted its easement to be indefeasible, it could have simplyincluded a provision stating, "Nothing in this document will**~ow** the amendment, alteration, or extinguishment ofDeveloper's easement/' This would have**prev~nted** anyone from arguing that Developer's easement is amendable, and thus, terminable.· So Developer's defeasible easement terminated upon a vote by the membership ofHOA, in accordance with the Original Declaration. The trial

. . court improperly granted summaryjudgment to Developer and the panel ofthe Court ofAppeals improperly affirmed the trial court. We holdfrom these facts that HOA was entitled tojudgment as a matter oflaw and**th~** trial court erred when itfailed to grant HOA's summaryjudgment motion. III. CONCLUSION. We reverse the holding ofthe Court ofAppeals and remand this case to ·the trial court with directions to enter summaryjudgmentin favor ofMajestic Oaks Homeowners Association. Minton, C.J.;

### C~nningh~, Hughes, Keller, Venters and Wright, JJ., sitting. All concur. VanMeter, J., not sitting.

20 B. Perini & Sons V. Southern Ry. Co., 239 S.W.2d 964, 966 (Ky. 1951). ' 10COUNSEL FOR APPELLANT: John C. ·Robinson Robinson Salyers, PLLC Brad Keeton Matthew Kuhn William M. Lear

### Jr Stoll Keenon Ogdon, PLLC
COUNSEL FOR APPELLEE, MAJESTIC OAKS FARMS, INC.: Paul Anton Zimlich PaUI A. Zimlich, PLLC coμNSEL FOR APPELLEES, JOSEPH O'BRIEN AND ASHLYN O'BRIEN: Austin Hays · Austin Hite Hays, PLLC. John B. Baughmam Baughman Harp, PLLC.

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