Title: Saddlebrook Estates v. City of Suffolk
Citation: N/A
Docket Number: 151191
State: Virginia
Issuer: Virginia Supreme Court
Date: June 2, 2016

PRESENT:  All the Justices 
 
SADDLEBROOK ESTATES COMMUNITY 
ASSOCIATION, INC. 
 
 
OPINION BY  
v.  Record No. 151191  
JUSTICE WILLIAM C. MIMS 
 
 
June 2, 2016 
CITY OF SUFFOLK 
 
 
FROM THE CIRCUIT COURT OF THE CITY OF SUFFOLK 
Carl E. Eason, Jr., Judge 
 
In this appeal, we consider whether the definition of “open or common space” in Code § 
58.1-3284.1(A) excludes real property used for a commercial enterprise. 
I.  BACKGROUND AND MATERIAL PROCEEDINGS BELOW 
Christina Gray obtained a conditional use permit for a cluster development on a parcel of 
real property situated in the City of Suffolk.  The development proposal included an equestrian 
center.  Gray thereafter conveyed the parcel to Kings Fork, LLC (“Kings Fork”).  Kings Fork set 
aside a portion of the parcel as the Equestrian Center Parcel (“the ECP”). 
Kings Fork leased the ECP to David Christiansen and Indian Point Farms, LLC (“Indian 
Point”) through December 2019 to establish and operate a riding school and stable called Indian 
Point Stables (“the Stable”).  The lease provided that Christiansen and Indian Point “shall pay all 
City of Suffolk real estate taxes owed” on the ECP during the term of the lease.  The lease 
expressly anticipated that Kings Fork’s ownership interest in the ECP would later be conveyed to 
the planned property owners’ association for the surrounding residential subdivision, which was 
subsequently organized as the Saddlebrook Estates Community Association, Inc. (“the 
Association”).  Although the Stable could sell its services to non-members, the lease required 
Christiansen and Indian Point to give preferential treatment to members of the Association. 
 
2 
Kings Fork subsequently conveyed the ECP and other common areas by deed of 
dedication to the Association.  The Association’s declaration included the ECP within the 
Association’s property but noted that it was leased to Christiansen and Indian Point.  The 
declaration also conveyed an easement of enjoyment in all Association property, including the 
ECP, to the Association’s members, subject, among other things, to the Association’s right to 
enter into agreements for the operation of the Stable. 
The City of Suffolk began assessing real estate tax on the ECP for the tax year ending in 
June 2009.  In August 2012, the City exonerated the Association of any liability for tax on the 
ECP for the tax years ending in June 2009, 2010, and 2011.  The City again assessed real estate 
tax on the ECP for the tax years ending in June 2012, 2013, 2014, and 2015.  These later 
assessments identified the Association as the owner of the ECP and were sent to “Saddlebrook 
Estates Comm Assoc c/o David Christiansen.”  No one paid the assessments. 
In February 2014, the City published a notice advertising that the ECP would be sold at 
auction for non-payment of taxes.  The Association filed a complaint seeking a stay of the sale 
and a declaratory judgment (1) that it was not liable for the assessments, and (2) that the ECP 
could not be directly assessed because under Code § 58.1-3284.1(A) any tax due was payable 
only by the Association’s various individual members.1  The City filed an answer denying that 
the ECP qualified under the statute. 
                                                 
1 While the case was pending below, the Association sold a lot from the ECP to 
Christiansen and his wife to use as their residence.  The parties do not dispute the Association’s 
authority under the declaration to convey this lot, and the Association concedes that the City has 
the authority to assess real estate tax on it from the date of the deed, for which the Christiansens 
would be liable.  The question of whether the City may assess them for real estate tax on this lot 
after this conveyance is therefore not within the scope of this appeal. 
 
3 
The case proceeded to a bench trial.  At the conclusion of the Association’s evidence, the 
City moved to strike.2  The circuit court ruled that the Stable was a commercial enterprise and 
that the General Assembly did not intend “open or common space” as used in Code § 58.1-
3284.1(A) to include real estate used for the operation of commercial enterprises open to non-
members of a property owners’ association.   It therefore granted the City’s motion.  It thereafter 
entered a final order incorporating its bench rulings on the motion to strike and dismissing the 
complaint with prejudice. 
We awarded the Association this appeal. 
II.  ANALYSIS 
In its first assignment of error, the Association asserts that the circuit court erred in its 
interpretation of Code § 58.1-3284.1(A).  It argues that the definition of “open or common 
space” in the statute does not exclude real property used for commercial enterprises.  It further 
argues that at common law, the value of an easement is assessed against the owner of the 
dominant estate and the value of the servient estate is reduced accordingly.  Thus, it continues, in 
Lake Monticello Owners’ Association v. Ritter, 229 Va. 205, 327 S.E.2d 117 (1985), this Court 
ruled that the value of common area owned by the property owners’ association could be 
assessed only against the association’s members, not the association itself.  The Association 
further argues that Code § 58.1-3284.1 was originally enacted by the General Assembly while 
Lake Monticello was pending to codify that principle.  The principle controls here, the 
Association concludes, because (1) the Stable was intended to be an essential part of the 
                                                 
2 The City argued among other things that it had not assessed the tax against the 
Association but against Christiansen, in his capacity as a lessee, under Code § 58.1-3203.  
However, at oral argument on appeal, the City conceded that it sent the assessments only “c/o 
David Christiansen” and that Indian Point was not identified on the assessments at all.  
Accordingly, the assessments were sent only to the Association, not to the lessees. 
 
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subdivision going all the way back to the original conditional use permit, (2) the Association’s 
declaration included the ECP in its definition of the common area, and (3) the ECP is for the 
benefit of the Association’s members, subject only to agreements necessary for the operation of 
the Stable.  We agree. 
We review questions of statutory interpretation de novo.  Sheppard v. Junes, 287 Va. 397, 
403, 756 S.E.2d 409, 411 (2014).  We presume that the legislature completely expressed its 
intention in the statutory language it enacted unless that language is ambiguous or leads to an 
absurd result.  Id.  The statutory language at issue here is not ambiguous and does not lead to an 
absurd result.  We will therefore give effect to its plain meaning. 
Code § 58.1-3284.1(A) provides that 
 
[r]esidential or commercial property, which is part of a planned development 
which contains open or common space, which includes the right by easement, 
covenant, deed or other interest in real estate, to the use of the open or common 
space, shall be assessed at a value which includes the proportional share of the 
value of such open or common space. 
 
All real property used for open or common space pursuant to this section 
shall be construed as having no value in itself for assessment purposes. Its only 
value lies in the value that is attached to the residential or commercial property 
which has a right by easement, covenant, deed or other interest. 
It then proceeds to define “open or common space” as used in these paragraphs to include in 
relevant part “parks, parking areas, private streets, walkways, recreational facilities, natural or 
improved areas, lakes, ponds, recreational, community service, or maintenance buildings or 
structures, or any other property used and owned by an automatic membership corporation or 
association.”  Id. 
The first two paragraphs of the statute are consistent with the common law principle cited 
by the Association and applied in Lake Monticello.  229 Va. at 208-09, 327 S.E.2d at 119.  
Under the second paragraph, the entire value of the fee of the common area is wholly consumed 
 
5 
by the easement conveyed for the benefit of the Association’s members.  Thus, the value of the 
common area to the servient estate, which the Association owns, is reduced to nothing by 
operation of the statute.  However, the common area is not exempt from taxation.  Rather, the 
second paragraph sets the value for assessment purposes as the value the common area provides 
to the dominant estate (i.e., the lots in the subdivision, which benefit from the easement).  This is 
not the value of the fee of the common area itself, but the value by which access to and use of the 
common area augments the value of the lots.  The first paragraph then makes the owners of the 
dominant estate (i.e., the owners of the lots), and only them, liable for the tax assessed on that 
value in proportion to each owner’s respective lot as a percentage of the whole subdivision.  The 
statute therefore directs localities both how to ascertain the value of the common area and whom 
to assess for payment of the tax.3 
We must next consider whether the ECP is within the Association’s common area, or 
more precisely, whether it is within the statutory definition of “open or common space.”  We 
agree with the Association that it is. 
Although the City argues that real property used for commercial enterprises is not within 
the meaning of “open or common space” as used in the statute, nothing in the statutory definition 
excludes such real property.  To the contrary, the statutory definition expressly includes both 
                                                 
3 We note that the lease required the lessees to pay all real estate taxes.  The lease was 
executed in December 2002 and the Association’s declaration was executed in March 2005, 
during which time Code § 58.1-3284.1(A) could not apply to the ECP because no easement for 
the benefit of the Association’s members existed.  Whether the Association may or may not 
enforce the tax liability provision of the lease against the lessees after the easement was 
conveyed is not within the scope of this appeal.  Our holding is simply that the statute prohibits 
the City from assessing anyone other than the owners of the subdivision’s lots. 
 
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“recreational facilities” and “any . . . property used and owned by an automatic membership 
corporation or association.”  Code § 58.1-3284.1(A).4 
Further, despite the City’s argument to the contrary, the facts in Lake Monticello are 
indistinguishable from those in this case.  The common area in Lake Monticello included a golf 
course and other recreational facilities.  The property association there sold course memberships 
to non-members of the association to raise additional revenue rather than fund the operation of 
the course solely from members’ association fees.  229 Va. at 207-08, 327 S.E.2d at 118-19.  
Like the golf course in Lake Monticello, the Stable is open to non-members and the profits of the 
commercial enterprise are used to defray the Association’s operating costs, thereby reducing its 
members’ association fees.  Further, a member of the Association testified that he and other 
members benefited from the Stable, as witnesses in Lake Monticello testified that they benefited 
from the golf course.  229 Va. at 210, 327 S.E.2d at 120. 
The record in this case also includes testimony that even Association members who did 
not board horses at the Stable used its picnic tables, trails, and parking area.  Families used the 
ECP to ride bikes, walk dogs, push strollers, gather pecans, and watch and interact with the 
horses.  The fact that the Association operated the Stable through a lease agreement with 
Christiansen and Indian Point and collected the supplemental revenue derived from the Stable’s 
profit in the form of a lease payment from the lessees, rather than operating the Stable and 
collecting user fees directly, as the Lake Monticello association did for its golf course, is a 
                                                 
4 The City also argues that the circuit court ruled that the members must have the 
exclusive use of the common area and found that the Association’s members did not have 
exclusive use of the ECP.  However, while the court mentioned in its bench ruling that the 
members did not have exclusive use of the Stable, it expressly struck that ground from its final 
order.  Courts speak only through their written orders and we do not consider grounds of 
decision purposely excluded from them.  See Manchester Oaks Homeowners Ass'n v. Batt, 284 
Va. 409, 419 n.6, 732 S.E.2d 690, 696 n.6 (2012). 
 
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distinction without a difference.  Code § 58.1-3284.1(A) does not prohibit associations from 
entering into agreements with outside entities for the operation of recreational facilities within 
their common areas, and such contractors may reasonably expect to profit from such 
agreements.5 
The City also argues that under Keswick Club, L.P. v. County of Albemarle, 273 Va. 
128, 639 S.E.2d 243 (2007), it is required to assess the ECP at its fair market value, which must 
include the commercial enterprise.  The City is correct that we noted in Keswick Club that the 
Constitution of Virginia requires real property to be assessed at fair market value.  273 Va. at 
136, 639 S.E.2d at 247.  However, the City’s precise argument here contravenes the actual 
constitutional language, which requires real property to be assessed at “fair market value, to be 
ascertained as prescribed by law.”  Va. Const. art. X, § 2.  As noted above, Code § 58.1-
3284.1(A) prescribes how to ascertain the fair market value of a property owners’ association’s 
common area, which is significantly encumbered by the easement for the benefit and use of the 
association’s members.  Under the statute, the assessable value is the value the common area 
adds to the lots within the subdivision. 
Finally, the City argues that if it failed to assess the Stable as a commercial enterprise, it 
would violate article X, § 1 of the Constitution of Virginia, which requires all real property of the 
same class to be assessed uniformly.  However, there is no constitutional violation because Code 
§ 58.1-3284.1(A) creates a class of real property, specifically “open or common space” as 
defined therein, and provides a uniform method for its assessment. 
 
                                                 
5 Nothing in our decision today affects any authority localities may have to regulate land 
use through their zoning ordinances, which authority may or may not include restricting the use 
of real property within a cluster development for commercial enterprises.  That question is not 
before us in this case and we do not decide it here. 
 
8 
III.  CONCLUSION 
For the foregoing reasons, the circuit court erred by ruling that the ECP did not fall 
within the meaning of “open or common space” as defined by Code § 58.1-3284.1(A) because 
the Stable is a commercial enterprise.  Accordingly, we will reverse the court’s judgment, vacate 
the assessments, and enter final judgment for the Association.6 
Reversed, vacated, and final judgment. 
                                                 
6 Because the City did not in fact assess the lessees, we do not consider the Association’s 
second assignment of error that the City had no authority to do so under Code § 58.1-3203.