Opinion ID: 1954389
Heading Depth: 1
Heading Rank: 5

Heading: nature of regency homes association and regency lake and tennis club

Text: As a preliminary matter, it is necessary to determine to what type of entity the Egermayers, as Regency property owners, are required by the Declaration to pay dues. As previously noted, the Egermayers have characterized the issue in this case as whether the Declaration is a valid covenant running with the land as it applies to the obligation to join and pay dues to a social club open to the public and owned by a private individual.  (Emphasis supplied.) First, we consider the Egermayers' contention that the Declaration requires them to pay dues to a social club. The Declaration requires that Regency property owners pay dues to the RHA; there is no requirement that dues be paid to RLTC. In fact, the Declaration makes no mention of RLTC. However, the Egermayers argue that RHA and RLTC are the same entity. The manager of RHA, Hildegard Herzfeldt, seemed to concede this point at trial when she testified as follows: [Appellants' attorney:] The Regency Lake and Tennis Club, is that a name for the same entity as the Regency Home Association, or is that a separate entity? [Herzfeldt:] That's right. It's the same. Q. It's the same? A. Yes. In addition, in interrogatories RHA identified both the members of RHA and the members of RLTC by referring to an attached copy of the 1988-89 RLTC directory. However, other evidence in the record indicates that RHA and RLTC are not in fact identical entities. A former president of RHA, John Hubbard, testified that RHA is the formal body of members and that RLTC has no separate existence from RHA as a subsidiary corporation, a sole proprietorship, or partnership. Hubbard further testified that RLTC is just a facility or a club or an activity that is operated by [RHA] as a corporation. While RLTC may have no separate existence apart from RHA, it is quite apparent that RHA does have an existence apart from RLTC. For example, RHA maintains a 1-acre park and an entrance to the residential area which are not maintained by the city of Omaha, provides architectural review for the subdivision, and provided security patrol for the subdivision until after Regency was annexed by the city. Although RHA also operates and maintains the RLTC, we conclude upon a de novo review that this is not RHA's sole function, and the Egermayers cannot complain that they are being assessed dues merely for a social club. Next, we turn to the assertion that RLTC is a nonexclusive club which is open to the public. The word public may be defined as the the community at large.... [It] does not mean all the people ... but so many of them as contradistinguishes them from a few. Black's Law Dictionary 1227 (6th ed. 1990). On the other hand, [m]embership in a club arises out of the application of the member, its acceptance by the club, and the provisions of the by-laws. A private club has the right to select its own members, and membership in such context is not a constitutional right, but rather is a bare privilege.... 14A C.J.S. Clubs § 10 at 614-15 (1991). The terms of the RHA bylaws; the fact that membership is available only to Regency property owners and a limited number of other individuals who must apply for membership, must be recommended by two members, and must be approved by the board of directors; and the fact that the RLTC is not open to the general public are all indicia of a private club. Finally, we turn to whether RLTC is a privately owned facility. The Egermayers state that at the time they bought their lot, both the lake and the social club were privately owned. Today, the lake continues to be privately owned. Brief for appellants at 20. The record indicates that all of the facilities of RLTC with the exception of the lake were deeded to RHA by United of Omaha, the developer of Regency, on May 31, 1980. This was almost a year and a half after the Egermayers bought Lot 10. Since that time, members of RHA have had a common ownership of the club facilities. The fact that United of Omaha retained ownership of RLTC for approximately 12 years is not dispositive of whether RLTC is privately owned. See Boyle v. Lake Forest Property Owners Ass'n, 538 F.Supp. 765 (S.D.Ala.1982) (holding that a developer, carrying out a uniform plan of development for a residential subdivision, may arrange for provision of certain services to the subdivision and for the maintenance of the facilities devoted to common use, and may bind the lot purchasers in the subdivision to pay for those items.) Nor does the fact that Regency Lake is privately owned impute private ownership to RLTC. Although RHA pays a portion of the maintenance for the lake, RHA members are allowed access to the facility. Under the circumstances, it cannot be said that the Egermayers are being required to pay dues to a privately owned club. Upon a de novo review of the record, we conclude that the Egermayers are not being required by the Declaration to pay dues to a public social club which is privately owned, but to a homeowners' association. We thus turn to the underlying issue in the case, that is, whether the Declaration is a valid covenant running with the land as it applies to the obligation of a property owner to pay dues to a homeowners' association which operates a recreational facility.