Court Opinion

ID: 4386283
Source: CourtListenerOpinion
Date Created: 2019-04-11 15:04:25.96176+00
Date Added: 2024-06-11T14:23:00.469504
License: Public Domain

FILED
                                                                              Apr 11 2019, 10:18 am

                                                                                    CLERK
                                                                               Indiana Supreme Court
                                                                                  Court of Appeals
                                                                                    and Tax Court

ATTORNEYS FOR APPELLANT                                     ATTORNEYS FOR APPELLEES
Laura B. Conway                                             Thomas F. Bedsole
Steven C. Earnhart                                          Maggie L. Smith
Thrasher Buschmann & Voelkel, P.C.                          Jenai M. Brackett
Indianapolis, Indiana                                       Frost Brown Todd LLC
                                                            Indianapolis, Indiana

                                             IN THE
    COURT OF APPEALS OF INDIANA

The Village Pines at the Pines of                           April 11, 2019
Greenwood Homeowners’                                       Court of Appeals Case No.
Association, Inc.,                                          18A-PL-135
Appellant-Plaintiff,                                        Appeal from the Johnson Superior
                                                            Court
        v.                                                  The Honorable Marla Clark, Judge
                                                            Trial Court Cause No.
Pines of Greenwood, LLC, and                                41D04-1111-PL-86
Arbor Homes, LLC,
Appellees-Defendants.

Brown, Judge.

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                           Page 1 of 25
[1]   The Village Pines at the Pines of Greenwood Homeowners’ Association, Inc.,

      (the “HOA”) appeals the trial court’s entry of judgment on its claims for breach

      of fiduciary duty and breach of contract in favor of Pines of Greenwood, LLC

      (“Pines”) and Arbor Homes, LLC (“Arbor Homes”). Reviewing the trial

      court’s findings and judgment under the clear error standard, we conclude that

      Pines and Arbor Homes violated the stated procedure for amending relevant

      covenants, conditions, and restrictions affecting the parties, and remand for a

      hearing on damages on the breach of contract claim. We affirm in part, reverse

      in part, and remand.

                                     Facts and Procedural History

[2]   The HOA is a not-for-profit corporation organized under the laws of the State

      of Indiana with a principal place of business in Greenwood, Indiana, its

      primary purpose being to manage the residential community commonly known

      as Village Pines at the Pines of Greenwood (the “Neighborhood”). Pines

      developed and constructed the Neighborhood, and Arbor Homes was the

      exclusive builder of all of its single-family homes.

[3]   On January 24, 2000, The Declaration of Covenants, Conditions and

      Restrictions and Grant and Reservation of Easements for The Village Pines at

      the Pines of Greenwood (the “Declaration”) was recorded as Instrument No.

      2000-001680 in the Office of the Recorder of Johnson County by Pines and

      Arbor Homes. The Declaration provided that “Association shall mean The

      Village Pines at The Pines of Greenwood Home Owners Association,” – that is,

      the HOA; that “Declarant shall mean [Pines]” and “[a]s long as [Arbor Homes]
      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019         Page 2 of 25
      is the exclusive builder of single family homes on the Lots, [Arbor Homes] shall

      have the same rights as the Declarant hereunder”; and that “Owner shall mean

      the Person or Persons, including Declarant, holding fee simple interest to a Lot,

      excluding those having such interest merely as security for the performance of

      an obligation.” Exhibits Volume III at 15-16, 18. It provided that

      “Development Period shall mean the period of time during which the Declarant

      owns at least one (1) lot,” that “Lot shall mean and refer to any and each plot of

      land included in the Property[ 1] designed and intended for use as a building site

      for a single family residence,” and that “Annual Assessment shall mean a

      charge against a particular Owner and his Lot, representing a portion of the

      Common Expenses[ 2] which are to be levied among all Owners and their Lots in

      the Property in the manner and proportions provided herein.” Id. at 15-17.

[4]   Beginning in 2000, Pines was in charge of the HOA and had the sole power to

      elect officers and the HOA’s Board of Directors (the “Board”). Article II of the

      Declaration set forth provisions for the HOA and provided in part that the

      Board would manage the HOA’s affairs. Section 2.3 provided in part that

      “[e]very Owner of a Lot, except as herein provided to the contrary, shall be

      1
       Section 1.33 of the Declaration defines “Property” to mean “the real estate described in the attached
      Exhibit ‘A’.” Exhibits Volume III at 18. Stipulated Exhibit 1 contains a survey document titled “Exhibit ‘A’
      The Village Pines of Greenwood.” Id. at 55.
      2
       Section 1.14 of the Declaration defines “Common Expenses” to mean in part “those expenses for which the
      Association is responsible under this Declaration, including the actual and estimated costs of: maintenance,
      management, operation, repair and replacement of the Common Areas . . . , and any Improvements thereon,
      or unpaid Special Assessments.” Exhibits Volume III at 16.

      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                               Page 3 of 25
      entitled and required to be a member[ 3] of the Association” and that “[e]xcept as

      herein otherwise expressly provided, no person or entity other than an Owner

      or Declarant may be a member of the Association, and a membership in the

      Association may not be transferred except in connection with the transfer of

      title to a Lot.” Id. at 19.

[5]   Article V of the Declaration set forth the HOA’s “Maintenance Funds and

      Assessments” and provided in part:

              5.1 Personal Obligation of Assessments. Declarant, on behalf of
              itself and all future Owners, hereby covenants and agrees to pay,
              and each Owner by accepting title to a Lot or any interest
              therein, whether or not it shall be expressed in the deed or other
              instrument conveying title, shall be deemed to covenant and
              agree to pay to the Association, Annual Assessments and other
              amounts as required or provided for in this Declaration.
              Amounts payable for Annual Assessments and Special
              Assessments (as generally defined in Sections 5.5 and 5.7,
              respectively) are generally referred to herein as “Assessments.”
              Other amounts payable by an Owner to the Association, (or
              payable with respect to an Owner’s Lot), including late charges,
              fines, penalties, interest, attorneys fees and other costs and
              expenses incurred by the Association in collecting unpaid
              amounts shall be added to the Annual or Special Assessments,
              charged to his Lot and shall be enforceable and collectible as
              Annual or Special Assessments. . . .

              Subject to the provisions hereof, the Board shall have the power
              and authority to determine all matters in connection with Annual

      3
        Section 1.26 of the Declaration defines “Member” to mean “any Person holding a Membership in the
      Association,” and section 1.31 of the Declaration defines “Person” to mean a “natural individual or any
      other entity with the legal right to hold title to real property.” Exhibits Volume III at 17-18.

      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                               Page 4 of 25
        or Special Assessments, including, without limitation, power and
        authority to determine where, when and how Assessments shall
        be paid to the Association, and each Owner shall comply with all
        such determinations.

        5.2 Maintenance Funds of Association. The Board shall
        establish no fewer than two (2) separate Association
        Maintenance Funds, into which shall be deposited all monies
        paid to the Association, and from which disbursements shall be
        made, as provided herein, in the performance of functions by the
        Association under this Declaration. The Association
        Maintenance Funds may be established as trust accounts at a
        banking or savings institution, in federally insured accounts, and
        shall include: (1) an Operating Fund for current Common
        Expenses of the Association, (2) an adequate Reserve Fund for
        capital Improvements, replacements, painting and repairs of the
        Common Areas (which cannot normally be expected to occur on
        an annual or more frequent basis) . . . . The Board shall establish
        a Capitalization Account which shall consist of at least fifty
        percent (50%) of the capital contributions made by Owners
        pursuant to Section 5.12 hereof.

                                               *****

        5.5 Annual Assessments/Commencement-Collection. Annual
        Assessments, and any monthly installment related thereto, shall
        commence on the first day of the first calendar month following
        the Closing of the sale of the first Lot. Thereafter, the
        Association is specifically authorized to enter into subsidy
        contracts or contracts for “in kind” contribution of services,
        materials, or a combination of services and materials with the
        Declarant or other entities for payment of Common Expenses.

        All Annual Assessments shall be assessed equally against the
        Members and their Lots based upon the number of Lots owned
        by each Member. Annual Assessments for fractions of any
        month involved shall be prorated. Subject to the terms of any
        subsidy contract, Declarant shall pay to the Association until the

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019         Page 5 of 25
        Applicable Date, an amount equal to the difference, if any,
        between the expenditures of the Association made pursuant to
        this Article V and the aggregate amount of the Annual
        Assessments collected by the Association. From time to time the
        Board may determine that all excess funds in the Operating Fund
        be retained by the Association and used to reduce the following
        year’s Annual Assessments.

                                               *****

        5.6 First Annual Assessment and Maximum Annual Increases.

               [] First Annual Assessment. The initial Annual
        Assessment for the fiscal year in which Assessments first
        commence shall be calculated as determined from the Budget.
        The Board shall estimate and prepare a Budget for the costs and
        expenses to be incurred by the Association during the first Fiscal
        Year . . . . All costs and expenses incurred (i) in fulfilling the
        financial obligations of the Association prior to the first Fiscal
        Year or (ii) ordinarily and necessarily by the Association in
        excess of Assessment installments to be paid during that first
        partial fiscal year shall be the responsibility of Declarant, and
        Declarant hereby covenants to bear and to pay or otherwise
        satisfy such financial obligations.

        5.7 Special Assessments. In addition to Annual Assessments,
        the Association may levy Special Assessments, at such frequency
        and in such amounts as established by the Board, payable over
        the period of an Association Fiscal Year (i) for the purpose of
        defraying, in whole or in part, the costs of any acquisition,
        construction, reconstruction, maintenance, repair or replacement
        provided for or required pursuant to Article II; (ii) for the
        purpose of defraying any other expense incurred or to be incurred
        by the Association as provided in this Declaration; or (iii) to
        cover any deficiency in the event that, for whatever reasons, the
        amount received by the Association from Annual Assessments is
        less than the amount determined to be necessary and assessed by
        the Board. Special Assessments for these purposes may not be

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019            Page 6 of 25
              levied unless approved by Members holding a majority of the
              votes held by all Members.

              5.8 Time for Payments. Each installment of the Annual
              Assessment shall be due on the first day of the period covered by
              said installment. The amount of any Assessment, late charge,
              fine, penalty or other amount payable by an Owner or Resident
              with respect to such Owner’s Lot shall become due and payable
              as specified herein and if said payment is not received, then said
              Owner shall also be responsible for any late charges, interest,
              fines, penalties or attorneys fees related thereto. . . . Annual
              Assessments shall be paid and collected on a quarterly basis or at
              such other frequency as may be adopted by the Board.

                                                     *****

              5.12 Initial Capital Contributions to the Association. At the
              closing of the purchase of a Lot from Declarant, each Owner of a
              Lot shall contribute to the capital of the Association, an amount
              equal to One Hundred Dollars ($100.00). This amount shall be
              disbursed at the closing to the Association or to the Declarant if
              Declarant has previously advanced such funds to the
              Association. For purposes of this Declaration, Declarant, its
              assignees or assigns, and Arbor shall not be considered an
              Owner.

      Id. at 29-32, 34.

[6]   The Declaration provided mechanisms for amendment, which stated in part:

              12.2 Termination and Amendment.

              (a) Notice of the subject matter of a proposed amendment to this
              Declaration in reasonably detailed form shall be included in the
              notice of any meeting or election of the Association at which a
              proposed amendment is to be considered. The resolution shall be
              adopted by the vote, in person or by proxy, or written consent of

      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019        Page 7 of 25
              Members representing not less than sixty-seven percent (67%) of
              the voting power of the Association . . . .

                                                     *****

              12.3 By Declarant. Notwithstanding anything herein to the
              contrary, Declarant hereby reserves the right until the expiration
              of the Development Period to make such amendments to this
              Declaration as may be deemed necessary or appropriate by
              Declarant, without the approval of any other person or entity, in
              order to bring Declarant into compliance with the requirements
              of any statute ordinance, regulation or order of any public agency
              having jurisdiction thereof, or to correct clerical or typographical
              errors in this Declaration or any amendment or supplement
              hereto; provided that Declarant shall not be entitled to make any
              amendment which has a materially adverse effect on the rights of
              any Mortgagee, nor substantially impairs the benefits of this
              Declaration to any Owner or substantially increases the
              obligations imposed by this Declaration on any Owner. Each
              amendment to the Declaration shall be executed by Declarant
              only in any case where Declarant has the right to amend this
              Declaration without any further consent or approval, and
              otherwise by the Association. All amendments shall be recorded
              in the Office of the Recorder of Marion County, Indiana, and no
              amendment shall become effective until so recorded.

      Id. at 47-48.

[7]   At some point, the Reserve Fund was established as required by Section 5.2 of

      the Declaration. On May 18, 2006, the HOA held a meeting, which produced

      in part the following meeting minutes:

              III. PROPOSED AMENDMENTS

                       A. The Board is making a recommendation to amend [the
                          Declaration] to address the following items:

      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019          Page 8 of 25
                           1. Parking 8.2 – Parking and Vehicular Restrictions
                              ...
                           2. Commercial Vehicle Parking 8.2 – Parking and
                              Vehicular Restrictions . . .
                           3. Temporary Play Equipment 8.3 – Nuisances . . .
                           4. Trash 8.8 – Trash Containers . . .
                           5. A vote by proxy is anticipated the mail [sic] by
                              June 2006.
                              a. The Board promised to include in the voting
                                  packet.
                                  1. A copy of the 2006 Budget.
                                  2. A copy of the financial statement.
                                  3. A response to any of their questions the
                                     Board left this meeting with.

                                                 *****

                                    5. A legal opinion for Arbor on the dues
                                       issue.

                                                 *****

                                         This issue has taken on a life of its own. It
                                         will be addressed in a separate mailing.

                                                 *****

         V. DEVELOPER CONTRIBUTIONS

                   A. Please refer to [1.] 5.1 Personal Obligation of
                      Assessments. . . . [2.] 5.1 Annual
                      Assessments/Commencement-Collection.[ 4] . . . [and
                      3.] 5.12 Initial Capital Contributions to the

4
  The meeting minutes’ statement “5.1 Annual Assessments/Commencement-Collection” appears to be a
scrivener’s error, Exhibits Volume III at 168, as the text which follows quotes Section 5.5 of the Declaration.
See id. at 18.

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                                  Page 9 of 25
                             Association. . . .[ 5] For purposes of this Declaration,
                             Declarant, its assignees or assigns, and Arbor shall not
                             be considered an Owner.

                                                      *****

                        As stated above, this issue has taken on a life of its own
                        and will be answered in a future mailing.

               VI. RESERVE CAPITAL

                         [A.] 5.12 Initial Capital Contributions to the Association.
                         ...
                         [B.] 5.2 Maintenance Funds of Association. . . .

                                                      *****

                         C. Reserve Analysis – Quotes have been requested to
                            complete a Reserve Analysis to determine the future
                            needs of the neighborhood. (desire completion date is
                            90 to 120 days)
                             1. This will create a plan for long term future
                                 maintenance.
                                 a. Driveways
                                 b. Fences . . .
                                 c. Common Areas . . .
                             There was some discussion about what information
                             would be given to the Reserve Analysis Group to
                             allow them to make create [sic] their report.

      Id. at 166-170.

[8]   On November 6, 2006, Reserve Advisors, Inc. (“Reserve Advisors”) issued a

      reserve study obtained for the HOA based on Reserve Advisors’ September 20,

      5
       In the meeting minutes, an ellipsis follows “5.12 Initial Capital Contributions to the Association.” Exhibits
      Volume III at 168.

      Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                                Page 10 of 25
       2006 inspection of the Neighborhood. The study, as a “budget planning tool,”

       identified “the current status of the reserve fund and a stable and equitable

       Reserve Funding Plan to offset the anticipated future major common area

       expenditures,” found that the “unaudited cash status of the reserve fund, as of

       July 31, 2006, as reported by Management is $31,800,” and “[i]f the

       Association were to continue to fund reserves at its 2006 budgeted amount . . . ,

       the reserve fund would incur a potential shortage by 2010,” and recommended

       that “the Association adopt annual Reserve Contributions of $21,000 in 2007,

       $40,200 in 2008 and $59,400 in 2009.” Id. at 81-83.

[9]    On July 23, 2007, Pines recorded the First Amendment to the Declaration (the

       “First Amendment”) as Instrument No. 2007-017873 in the Office of the

       Recorder of Johnson County, and in doing so followed the procedure outlined in

       Section 12.2(a) of the Declaration. The First Amendment amended Section 8.2,

       titled Parking and Vehicle Restrictions; Section 8.3, titled Nuisances; and Section

       8.8, titled Trash Containers. Id. at 58-59.

[10]   On July 2, 2008, Pines and Arbor Homes recorded the Second Amendment to

       Declaration (the “Second Amendment”) as Instrument No. 2008-014227 in the

       Office of the Recorder of Johnson County, 6 which states:

       6
        The parties stipulated that the Second Amendment was recorded by Pines and Arbor Homes. See
       Appellant’s Appendix Volume 2 at 37. The Second Amendment states it was “entered into as of this 26th
       day of June, 2008, by PINES,” and indicates that it was signed by Donald M. Chesney, “V.P. of Field
       Operations” for Arbor Investments, LLC. Id. at 61, 64.

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                          Page 11 of 25
        WHEREAS, Declarant’s intent at the time the Declaration was
        prepared and recorded was to provide for Declarant to fund the
        deficit of the Association’s Common Expenses, if any, prior to
        the Applicable Date, and that Declarant would not otherwise be
        responsible for payment of the Association’s Common Expenses;
        and

        WHEREAS, the Declaration contains certain clerical and
        typographical errors.

        WHEREAS, such errors result in unintended ambiguities
        regarding Declarant’s obligations to contribute toward the
        Association’s Common Expenses;

        WHEREAS, Declarant wishes to correct such errors in the
        Declaration;

        WHEREAS, pursuant to the terms of Section 12.3 of the
        Declaration, Declarant has the right until the expiration of the
        Development Period to make amendments to the Declaration as
        may be deemed necessary or appropriate by Declarant, without
        the approval of any other person or entity, to correct clerical
        errors in the Declaration; and

        WHEREAS, Declarant represents that the Development Period
        has not terminated.

        NOW THEREFORE, Declarant is hereby entering into this
        Second Amendment as follows;

        1. The first sentence of Section 1.24, Lot, shall be deleted and
           replaced with the following:

             Lot shall mean and refer to any and each plot of land included
             in the Property identified as a lot on any recorded plat of the
             Property and designed and intended for use as a building site
             for a single family residence.

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019          Page 12 of 25
               2. Section 1.30, Owner, shall be deleted and replaced with the
                  following:

                    Except as otherwise provided in Article V, Owner shall mean
                    the Person or Persons, including Declarant, holding fee
                    simple interest to a Lot, excluding those having such interest
                    merely as security for the performance of an obligation. The
                    term “Owner” shall include a seller under an executory
                    contract of sale but shall exclude Mortgagees.[]

               3. The first sentence of Section 5.1, Personal Obligation of
                  Assessments, shall be deleted and replaced with the following:

                    Each Owner (other than Declarant), by accepting title to a Lot
                    or any interest therein, whether or not it shall be expressed in
                    the deed or other instrument conveying title, shall be deemed
                    to covenant and agree to pay to the Association, Annual
                    Assessments and other amounts as required or provided for in
                    this Declaration.

               4. The first sentence of Section 5.5 Annual
                  Assessments/Commencement-Collection, shall be deleted
                  and replaced with the following:

                    Annual Assessments, and any monthly installment related
                    thereto, shall commence on the first day of the first calendar
                    month following the Closing of the first sale of a Lot to a
                    person other than Declarant.

       Id. at 61-64.

[11]   On November 5, 2009, the HOA was turned over to the homeowners of the

       Neighborhood.

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019             Page 13 of 25
[12]   On November 4, 2011, the HOA filed a complaint against Pines, Arbor Homes,

       and Arbor Investments, LLC, 7 asserting claims for breach of fiduciary duty and

       breach of contract. 8 On April 28, 2017, the HOA, Pines, and Arbor Homes

       jointly stipulated to certain facts and exhibits. On May 9, 2017, a bench trial

       was held at which Megan Judson, an owner of a property management

       company and current property manager for the Neighborhood, testified that she

       built a home in the Neighborhood, closed on it in January 2008, and became a

       member of the Board “a few years after living there,” and indicated that the

       Second Amendment was not approved “by the members of the [HOA].”

       Transcript Volume II at 18, 27.

[13]   Judson testified that the Assessments were calculated “based on the Budget”

       and indicated that the Board would approve a Budget based upon the expected

       expenses for the Neighborhood “that includes operating and the reserve and,

       then, we’ll divide that up amongst the number of homeowners.” Id. at 22. She

       indicated that the assessments for the HOA had changed over time, answered

       affirmatively when asked “[w]ould the Assessments have been started around

       thirty-two dollars,” and testified “[m]aybe like in 2000 when it was, it was very

       first building.” Id. at 30. She was shown Stipulated Exhibit 10, a spreadsheet

       7
        An October 19, 2015 entry in the chronological case summary states, “Motion for Judgment on the
       Pleadings Filed Pursuant to TR 5(F)(3) ‘Defendant Arbor Investments, LLC’s Motion for Judgment on the
       Pleadings’,” and a February 3, 2016 entry states, “Order Granting Motion for Judgment on the Pleadings.”
       Appellant’s Appendix Volume II at 7-8.
       8
        The record does not contain a copy of the complaint. The HOA, Pines, and Arbor Homes agree that the
       complaint alleged breach of contract and breach of fiduciary duty.

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                            Page 14 of 25
       which “relates to the Lot numbers within [the Neighborhood], and the transfer

       dates for when the lots were transferred by Declarant to Third Parties,”

       Appellant’s Appendix Volume II at 40. She testified that it represented the Lots

       owned by Pines or Arbor Homes, that it included the date “that Assessments

       should have begun on . . . each property,” the date “that they should have

       ended because the property sold from the builder to a homeowner,” and the

       amount for each Lot. Transcript Volume II at 30. She testified that the

       principal balance due for Assessments on these Lots was $245,982.50, the

       amount due for late fees was $148,275.00, and the total amount due for

       Assessments and late fees was $394,257.50. Counsel for the HOA moved to

       admit the portions of Stipulated Exhibit 10 “that have not been stipulated to,”

       and the court admitted it over objection. 9

[14]   On October 2, 2017, the trial court entered judgment in favor of Pines and

       Arbor Homes and against the HOA on all claims in its Judgment Order. The

       Order found in part that Pines recorded the Second Amendment and that the

       Second Amendment was not approved by Members of the HOA and no

       meeting was held to vote on it. It also found that Pines and Arbor Homes did

       not pay assessments to the HOA from June 2000 to November 2009; that

       9
         Before the court admitted Stipulated Exhibit 10, counsel for Arbor Homes and Pines argued in part that the
       HOA had “simply taken the amounts that were charged to homeowners at the time and spread that out over
       all of the Lots which is improper,” and counsel for the HOA responded that “the Declarations clearly state
       that the Assessments have to be assessed equally across all Lots and this is the calculation showing the dates
       that Arbor, the Defendant, owned the Lot and, therefore, these are the dates that the Assessments would be
       owed.” Transcript Volume II at 35.

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019                                Page 15 of 25
Sections 5.5 and 5.6 set up a “‘Deficit Funding’ obligation” for Pines; that the

“Board of Directors for the Village Pines” established and funded the Reserve

Fund, which was funded during the Development Period; that Pines and Arbor

Homes made contributions to the HOA in 2000, 2001, 2002, 2003, and 2005;

and that, upon turnover of the HOA to the homeowners, as of November 30,

2009, the total amount in the Reserve Fund was $37,934.32. Appellant’s

Appendix Volume II at 21-22. The Order states in part:

        55. On three occasions during the Defendants’ control of the
        Association, money was removed from the Reserve Fund
        accounts.

        56. On October 12, 2001, $3000.00 was taken from the Union
        Planters Reserve Fund account and deposited in the Operating
        Account.

        57. On January 17, 2003, $12,534.64 was removed from the
        Union Planters Reserve Fund and deposited in the Operating
        Account to pay the lawn care provider.

        58. On April 10, 2008, $14,661.05 was removed from a
        Community Association Banc Reserve Fund and deposited in the
        Operating Account to pay for neighborhood plants.

        59. On July 24, 2009, $5,082.00 was removed from a
        Community Association Banc Operating Account and deposited
        in a Reserve Fund account.

        60. There was no evidence describing the use of these Funds
        from the Reserve Fund, why the transfers were made or who
        authorized or requested the transfers.

Id. at 24. The Order found that the HOA’s “expenditures were paid,” “the

deficit Funding system set forth under the Declaration satisfied all actual

Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019       Page 16 of 25
       expenditures of the [HOA] on an annual basis” and that the HOA “did not

       suffer any actual damages because its budget was fully funded every year.” Id.

       at 34.

[15]   Further, the Order found “no evidence of any impediment that would have

       prevented a member of the [HOA] from filing a derivative action on behalf of

       the [HOA] against the [Board] in 2006” based on the allegations contained in

       the lawsuit, as referenced in the minutes of the May 18, 2006 meeting. Id. at

       28. With regard to the HOA’s fiduciary duty claim, the order found that

       “Funds were transferred between the Reserve Fund and the operating account

       and vice versa as needed. At no time was the Reserve Fund not funded. These

       transactions do not amount to recklessness or willful misconduct. Further,

       there is no evidence that the Defendants had any part in these transactions.” Id.

       at 32-33. The HOA filed a motion to correct error, which the court denied.

                                                   Discussion

[16]   When, as here, the trial court enters findings of fact and conclusions, our

       standard of review is well-settled:

                We may not set aside the findings or judgment unless they are
                clearly erroneous. In our review, we first consider whether the
                evidence supports the factual findings. Second, we consider
                whether the findings support the judgment. Findings are clearly
                erroneous only when the record contains no facts to support
                them either directly or by inference. A judgment is clearly
                erroneous if it relies on an incorrect legal standard. We give due
                regard to the trial court’s ability to assess the credibility of the
                witnesses. While we defer substantially to findings of fact, we do

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019          Page 17 of 25
               not defer to conclusions of law. We do not reweigh the evidence;
               rather we consider the evidence most favorable to the judgment
               with all reasonable inferences drawn in favor of the judgment.

       State v. IBM, 51 N.E.3d 150, 158 (Ind. 2016) (internal quotations and citations

       omitted). In order to determine that a finding or conclusion is clearly

       erroneous, an appellate court’s review of the evidence must leave it with the

       firm conviction that a mistake has been made. Yanoff v. Muncy, 688 N.E.2d

       1259, 1262 (Ind. 1997).

[17]   Here, the HOA appeals from a negative judgment and will prevail only if it

       establishes that the judgment is contrary to law. See Woodsmall v. Lost Creek Tp.

       Conservation Club, Inc., 933 N.E.2d 899, 902 (Ind. Ct. App. 2010) (citing Fowler

       v. Perry, 830 N.E.2d 97, 102 (Ind. Ct. App. 2005)), trans. denied. A judgment is

       contrary to law when the evidence is without conflict and all reasonable

       inferences to be drawn from the evidence lead to only one conclusion, but the

       trial court reached a different conclusion. Id.

[18]   We note initially that, to the extent the HOA argues that Pines and Arbor

       Homes owed it a fiduciary duty, a breach of fiduciary duty is a tort claim for

       injury to personal property and the applicable statute of limitation is two years.

       See City of E. Chicago, Ind. v. E. Chicago Second Century, Inc., 908 N.E.2d 611, 618

       (Ind. 2009) (citing Del Vecchio v. Conseco, Inc., 788 N.E.2d 446, 451 (Ind. Ct.

       App. 2003); Ind. Code § 34-11-2-4), reh’g denied. The Indiana Supreme Court in

       dealing with a breach of fiduciary duty claim has declared that “a cause of

       action for a personal injury claim accrues and the statute of limitation begins to

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       run when the plaintiff knew, or in the exercise of ordinary diligence could have

       discovered, that an injury had been sustained as a result of the tortious act of

       another.” Id. (citing Malachowski v. Bank One, Indianapolis, 590 N.E.2d 559 (Ind.

       1992)). For a cause of action to accrue, it is not necessary that the full extent of

       damage be known or even ascertainable, but only that some ascertainable

       damage has occurred. Myers v. Maxson, 51 N.E.3d 1267, 1276 (Ind. Ct. App.

       2016), trans. denied.

[19]   The record reveals that the HOA held a meeting on May 18, 2006, at which

       representatives of the Board and Homeowners from forty-eight addresses were

       present. At the meeting a discussion on an anticipated June 2006 vote by proxy

       was held and the Board promised to include in the voting packet copies of the

       2006 Budget, financial statement, and legal opinions for Arbor Homes and for

       the HOA on “the dues issue,” which the meeting minutes figuratively described

       as having “taken on a life of its own.” Exhibits Volume III at 167. Arbor

       Homes’s legal position regarding Arbor Homes paying dues for each lot was

       explained, and several property owners expressed that the Declaration states

       that Arbor Homes should be paying dues. On appeal, the HOA claims that

       Pines and Arbor Homes breached their “fiduciary duty to [it] by failing to

       properly fund the reserve account.” Appellant’s Brief at 19. We observe that

       the capital reserve fund was discussed at the meeting, as were quotes that had

       been requested “to complete a Reserve Analysis to determine the future needs

       of the neighborhood,” and we note that one homeowner commented “it was

       imperative that the property owners make sure that the reserve capital is

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       adequate before Arbor is finished” and wanted “to make the point that these

       things needed to be determined while the property owners could make Arbor

       financially responsible.” Exhibits Volume III at 168-170. The reserve study

       obtained for the HOA was issued on November 6, 2006, identified “the current

       status of the reserve fund and a stable and equitable Reserve Funding Plan to

       offset the anticipated future major common area expenditures,” found that

       funding reserves at the 2006 budgeted amount “would incur a potential

       shortage by 2010” in the reserve fund, and recommended that the HOA adopt

       annual Reserve Contributions of $21,000 in 2007, $40,200 in 2008 and $59,400

       in 2009. Id. at 81-82. Further, the trial court found that no evidence of any

       impediment would have prevented a member of the HOA from filing a

       derivative action on behalf of the HOA against the Board in 2006. The HOA

       filed its complaint against Pines and Arbor Homes on November 4, 2011.

       Based on our review of the record, we conclude that some ascertainable damage

       had occurred that, in the exercise of ordinary diligence, could have been

       discovered prior to the expiration of the applicable statute of limitation period.

[20]   We next turn to the HOA’s breach of contract claim. Covenants, like the

       Declaration, are promises relating to real property that are created in

       conveyances or other instruments. See Land Innovators Co., L.P. v. Bogan, 15

       N.E.3d 23, 31 (Ind. Ct. App. 2014) (citing Columbia Club, Inc. v. American

       Fletcher Realty Corp., 720 N.E.2d 411, 417 (Ind. Ct. App. 1999), trans. denied),

       trans. denied. Covenants may be express or implied and are a species of express

       contract. Id. Thus, real covenants, when written, are generally construed in the

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       same manner as other written contracts. Id. (citing Keene v. Elkhart Cnty. Park &

       Recreation Bd., 740 N.E.2d 893, 896-897 (Ind. Ct. App. 2000)).

[21]   To the extent we must interpret the Declaration, “construction of the terms of a

       written contract is a pure question of law for the court, reviewed de novo.”

       Harrison v. Thomas, 761 N.E.2d 816, 818 (Ind. 2002). “The goal of contract

       interpretation is to determine the intent of the parties when they made the

       agreement.” Citimortgage, Inc. v. Barabas, 975 N.E.2d 805, 813 (Ind. 2012), reh’g

       denied. We determine the intent of the contracting parties by analyzing the

       contractual language within the four corners of the document. Beazer Homes

       Ind., LLP v. Carriage Courts Homeowners Ass’n, Inc., 905 N.E.2d 20, 23 (Ind. Ct.

       App. 2009) (citing Collins v. McKinney, 871 N.E.2d 363, 372 (Ind. Ct. App.

       2007)), reh’g denied, trans. denied. If that language is unambiguous, we may not

       look to extrinsic evidence to expand, vary, or explain the instrument. Id. (citing

       Ethyl Corp. v. Forcum-Lannom Assocs., Inc., 433 N.E.2d 1214, 1217 (Ind. Ct. App.

       1982)). “If the language is unambiguous, we give it its plain and ordinary

       meaning in view of the whole contract, without substitution or addition.” Care

       Group Heart Hosp., LLC v. Sawyer, 93 N.E.3d 745, 752 (Ind. 2018) (citing Ryan v.

       TCI Architects/Eng’rs/Contractors, Inc., 72 N.E.3d 908, 914 (Ind. 2017); State v.

       Int’l Bus. Machs. Corp., 51 N.E.3d 150, 160 (Ind. 2016)).

[22]   The HOA maintains that the trial court, having found that Pines and Arbor

       Homes recorded the Second Amendment, erred in not making any finding that

       Pines and Arbor Homes breached the Declaration’s amendment process. Pines

       and Arbor Homes argue in response that, in amending the Declaration and
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       recording the Second Amendment, they were correcting “unintended

       ambiguities” caused by prior scrivener’s errors and effectuating “the intent

       already found in Section 5.12, which provides, ‘For purposes of this

       Declaration, Declarant, its assignees or assigns, and Arbor shall not be

       considered an Owner.’” Appellees’ Brief at 16-17. Characterizing the Second

       Amendment as a “clean-up” amendment, Pines and Arbor Homes contend

       without specific citation to the record that, “when preparing to turn over

       control and funding of the HOA to the homeowners,” they “still believed their

       funding obligations in Section 5.5 and 5.6 – as well as their actual deficit

       funding practices over the years – made it clear that they would not also be

       considered ‘Owners’ for purposes of paying additional ‘per lot’ Annual

       Assessments that homeowners paid pursuant to Section 5.1.” Id. at 15. Citing

       to the stipulated exhibit consisting of the May 18, 2006 HOA Meeting minutes,

       they assert that the meeting participants were “informed that Management

       Company had hired an attorney for the HOA separate from Developer’s

       attorney to examine [the Declaration] and provide a determination regarding

       the Board of Directors’ prior conclusion that [the Declaration] did not

       contemplate collecting Annual Assessments on a per lot basis from

       Developer/Builder.” Id. at 13.

[23]   To the extent that Pines and Arbor Homes argue that they recorded the Second

       Amendment in accordance with Section 12.3 of the Declaration, Section 12.3

       provides in part that “Declarant hereby reserves the right” to make such

       amendments to the Declaration without the approval of any other person or

       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019         Page 22 of 25
       entity to correct “clerical or typographical errors in this Declaration.” Exhibits

       Volume III at 48. A “clerical error” is “an error resulting from a minor mistake

       or inadvertence . . . ; esp., a drafter’s or typist’s technical error that can be

       rectified without serious doubt about the correct reading.” See BLACK’S LAW

       DICTIONARY (10th ed. 2014). We further note that Section 12.3 goes on to

       qualify the above-mentioned right and states that Pines “shall not be entitled to

       make any amendment which has a materially adverse effect on the rights of any

       Mortgagee, nor substantially impairs the benefits of this Declaration to any

       Owner or substantially increases the obligations imposed by this Declaration on

       any Owner.” Exhibits Volume III at 48.

[24]   On January 24, 2000, when it was adopted, the Declaration expressly stated

       that Pines “on behalf of itself and all future Owners, hereby covenants and

       agrees to pay, and each Owner by accepting title to a Lot or any interest

       therein, whether or not it shall be expressed in the deed or other instrument

       conveying title, shall be deemed to covenant and agree to pay to the

       Association, Annual Assessments and other amounts as required or provided

       for in this Declaration.” Id. at 29. It additionally contemplated that “[a]ll

       Annual Assessments shall be assessed equally against the Members and their

       Lots based upon the number of Lots owned by each Member.” Id. at 31. We

       cannot agree that the Second Amendment, which removed Pines and Arbor

       Homes from the definition of Owners for purposes of Article V and the Annual

       Assessment obligations in that article, merely corrected clerical or typographical

       errors.

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[25]   To the extent that Pines and Arbor Homes contend that the Second Amendment

       did not increase any burden on any homeowner or substantively change any

       homeowner’s rights or obligations “as the HOA’s annual budgets were fully

       funded every year through at least December 31, 2008,” and argue that “because

       there were no unpaid, unbudgeted, or outstanding amounts, the HOA had not

       shown that it could have suffered any damages,” Appellees’ Brief at 17, 35, we

       note that the articles of incorporation and bylaws of a non-profit corporation

       constitute a contract between the corporation and its members and among the

       members themselves, Lynn v. Windridge Co-Owners Ass’n, Inc., 743 N.E.2d 305,

       313 (Ind. Ct. App. 2001), reh’g denied, trans. denied, and that a party who fails to

       make payments as required by a contract is guilty of a breach thereof. Henthorne

       v. Legacy Healthcare, Inc., 764 N.E.2d 751, 758 (Ind. Ct. App. 2002). The

       Declaration specifies that Pines, “on behalf of itself and all future Owners,”

       covenanted and agreed to pay Annual Assessments and “other amounts as

       required or provided for in this Declaration.” Exhibits Volume III at 29. Under

       a plain reading, the Declaration requires all Annual Assessments to “be assessed

       equally against the Members and their Lots,” contemplates that the assessments

       would be “based upon the number of Lots owned by each Member,” and defines

       “Member” to mean “any Person” – i.e. “any . . . entity with the legal right to

       hold title to real property” – “holding a Membership in the Association” and

       “Owner” to mean the “Person or Persons, including Declarant, holding fee simple

       interest to a Lot.” Id. at 17-18, 31 (emphasis added). After due consideration of

       the stipulated exhibits, evidence, and testimony presented at trial, and in light of

       the court’s finding that Pines and Arbor Homes did not pay assessments to the
       Court of Appeals of Indiana | Opinion 18A-PL-135 | April 11, 2019           Page 24 of 25
       Association from June 2000 to November 2009, we are not persuaded that the

       HOA did not suffer any damages.

[26]   The record reveals that Section 12.2 of the Declaration requires that a resolution

       of an amendment to the Declaration “shall be adopted by the vote, in person or

       by proxy, or written consent of Members representing not less than sixty-seven

       percent (67%) of the voting power of the Association.” Id. at 34. In their April

       28, 2017 submission, the Parties jointly stipulated that Pines and Arbor Homes

       recorded the Second Amendment. In its order, the court found that the Second

       Amendment was not approved by Members of the HOA and that no meeting

       was held to vote on it. Pines and Arbor Homes violated Section 12.2 of the

       Declaration in recording the Second Amendment.

                                                   Conclusion

[27]   For these reasons, we affirm the court’s judgment on the breach of fiduciary

       claim, and because we find that Pines and Arbor Homes did not properly

       record the Second Amendment, we reverse and remand for a hearing on

       damages on the breach of contract claim.

       Affirmed in part, reversed in part, and remanded.

       Altice, J., and Tavitas, J., concur.

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