Opinion ID: 1988985
Heading Depth: 1
Heading Rank: 5

Heading: Ownership of the Disputed Parcels

Text: Now that it has been determined that IDC's development rights expired after December 31, 1994, the next issue to be addressed is the ownership of the disputed parcels of land. The plaintiffs maintain that because all of the parcels were common elements in the GIS Condominium, title to the parcels had always vested in the unit owners subject to divestment by the declarant through the proper exercise of its development rights. They contend that when the declarant's development rights expired, its interests in the parcels ceased to exist and that, consequently, the hearing justice erred in failing to declare that title to the parcels was vested in the unit owners in fee simple. The defendants contest these claims. They assert that the disputed parcels of land were, and still are, limited master common elements allocated for the exclusive use of the declarant-owned master units that occupy the above airspace. [19] They maintain that such master units constitute real estate under the act and that even if the declarant's development rights expired after December 31, 1994, its improvement rights in its master units did not, and could not, expire. In other words, even if its rights to develop had ceased, it maintained its right to improve the real estate in its capacity as owner. Development rights are defined as: any right or combination of rights reserved by a declarant in the declaration to: (A) Add real estate to a condominium, (B) Create units, common elements, or limited common elements within a condominium, (C) Subdivide units or convert units into common elements, or (D) Withdraw real estate from a condominium. Section 34-36.1-1.03(11). Under the act, real estate is: any leasehold or other estate or interest in, over, or under land, including structures, fixtures, and other improvements and interests which by custom, usage, or law pass with a conveyance of land though not described in the contract of sale or instrument of conveyance. `Real estate' includes parcels with or without upper or lower boundaries, and spaces that may be filled with air or water. Section 34-36.1-1.03(24). The defendants contend that, according to the act, ownership of a master unit necessarily is ownership of real estate because it constitutes an interest in the airspace over the land. They maintain that the construction of a building within a master unit merely represents an improvement to the real estate and does not, therefore, fit within the statutory definition of a development right. Even if we were to accept defendants' assertion that a master unit in the airspace above a third-party owned unimproved lot with development rights is, in fact, real estate for purposes of the Act, [20] we do not accept their tortured conclusion that the construction of a building upon that lot is merely an improvement, rather than the exercise of a development right. Indeed, such an improvement constitutes one of the specific development rights reserved in the master agreement. Because the declarant's proposed construction effectively would subdivide the so-called master unit into smaller residential units, it falls squarely within § 34-36.1-1.03(11)(B)'s definition of development rights. As discussed above, those rights expired after December 31, 1994. Under the master declaration, the GIS Condominium consists of one large tract of land. Although defendants assert that the condominium is composed of separate lots, nothing in the record suggests that the parcel is divisible or contains more than one legal lot. See Dibiase v. Jacovowitz, 43 Mass.App.Ct. 361, 682 N.E.2d 1382, 1383 (1997). The master declaration granted the declarant a limited period to develop certain parcels of land within the condominium, but it could not convey title to the airspace if the development rights were not exercised. Because the master declaration described the entire parcel of land from the outset,    the entire parcel    was common area from the time the master [declaration] was recorded   . Id. at 1385. [21] Thereafter, the land never was subdivided and when the development rights expired, the disputed portions vested in fee simple in the unit owners as tenants in common in proportion to their respective undivided interests. Id. Considering that all the underlying land constituted common property, we conclude that when the associated development rights expired, so also did all of the declarant's rights in the master units. Accordingly, the hearing justice should have declared that title to the disputed property vested in the individual unit owners in fee simple. [22]