Court Opinion

ID: 5178633
Source: CourtListenerOpinion
Date Created: 2022-01-06 01:29:40.607652+00
Date Added: 2024-06-11T08:26:29.527248
License: Public Domain

*377Opinion by
JUDGE CASEBOLT
¶ 1 In this action by plaintiff, Ryan Ranch Community Assdciation, Inc., a homeowners association (the HOA), to recover disputed assessments from defendants, John É. and Kelly D. Kelley (the Kelleys), and Rick and Lora Zimmerman (the Zimmermans), defendants appeal the summary judgment in favor of the HOA on its claim that they owed more than $75,000 for monthly assessments. and related penalties and fees on their lots. The issue is whether the lots owned by .defendants, are subject to the servitudes set forth in the Declaration of Covenants, Conditions, and Restrictions (Declaration) of Ryan Ranch, particularly the obligation to pay assessments to 'the HOA. Contrary to the trial court’s ruling, we, conclude that the lots are not subject to the Declaration, and therefore reverse the judgment and remand for further proceedings.
I. Background
¶ 2 The parties .agree the following facts are undisputed.
¶ 3 In 2001, the Ryan Ranch, a large parcel of property located in Jefferson County, he-gan to be developed. At that time, an Official Development Plan (ODP) listed • John Kelley and the estate of Robert Ryan as owners, and Ryan Ranch, LLC, an entity owned by Charles Ochsner, as the developer. Ochsner’s entity (Ochsner) later purchased most of the land that would become Ryan Ranch Filings 1 and 2.
¶ 4 As pertinent here, in early 2003, Ochs-ner verbally agreed to sell Kelley seven lots to be developed, later known as Lots 1-7, Block 13, Ryan Ranch Filing 2 (the Kelley Lots), which are the subject of this action.
¶ 5 In summer 2003, Kelley learned that Ochsner was going to sell the majority of the Ryan Ranch property to The Ryland Group, Inc. (Ryland), the entity that would eventually create the HOA and record the Declaration. Kelley confirmed with Ochsner and Ryland the prior verbal agreement to purchase the Kelley Lots from Ochsner and received assurances that Ryland was not going to purchase them. Moreover, although Ryland intended to form the HOA for the development of the land, Ryland, Ochsner, and Kelley agreed that the Kelley Lots would not be included in the homeowners association to be formed by Ryland.
¶ 6 In September 2003, Ryland and Ochs-ner signed a contract for the sale of parcels in Ryan Ranch to Ryland in two phases, which specifically excluded the Kelley Lots, referring to them as “Seller’s Lots.”
¶ 7 In October 2003,, consistent with their prior agreement, Ochsner and the Kelleys signed a written contract for the Kelleys to purchase the Kelley Lots. The Kelleys understood that those lots would be conveyed after the Ryan Ranch Filing 2 plat map was recorded. Ryland and Kelley also signed an agreement on October 15, 2003, providing that the Kelley Lots would not be subject to the maintenance obligations of the HOA to be formed by Ryland, and that Ryland would record covenants to exclude them from the HOA. Ryland, however, never recorded any such covenants.
¶ 8 The first phase of the Ochsner-Ryland transaction was completed on October 29, 2003, and the Ryan Ranch Filing 1 plat map was recorded on November 13, 2003. Ochs-ner, however, did' not timely obtain approval of the Filing 2 plat map for recording, and the sale' of the Kelley Lots to the Kelleys did not occur at the time specified in that contract.
¶ 9 After Ryland filed articles of incorporation for the HOA, in March 2005 It recorded the Declaration of Ryan Ranch Community Association, encumbering Filing 1. Specifically, the Declaration stated that Ryland “desires to subject and place upon the real property described on the attached Exhibit A certain covenants, conditions, restrictions ... obligations, liabilities and other charges.” The Declaration further declared “that all of the real property described on the attached Exhibit A shall be held, sold and conveyed subject to the following covenants, conditions, restrictions, •... obligations, liabilities, charges and other provisions set forth herein.” The obligations included the duty to pay assessment fees. Exhibit A did not contain the Kelley lots. .
*378¶ 10 The Declaration also provided that other property could be annexed into the community pursuant to Article XII, section 5. The Declaration described the property that was “annexable property5’ as all individual lots within Filing 1 and other land “to the extent it is owned at the time of annexation by Declarant, or if not owned by Declarant[,] •with the written consent of the owner thereof,” and provided a metes and bounds description of the entirety of Ryan Ranch Filing 2, which included the Kelley Lots.
¶ 11 Because of delays in obtaining Jefferson County’s approval for the Ryan Ranch Filing 2 plat map, Ochsner’s sale to Ryland of the land comprising Filing 2 was delayed. In agreements to extend closing, Ochsner and Ryland agreed that closing would occur after the recording of the Filing 2 plat map, but not later than June 16, 2006.
¶ 12 In May 2005, with the Filing 2 plat map supposedly nearing approval, the Kel-leys and Ochsner reaffirmed their 2003 contract by signing a second contract for the sale of the Kelley Lots, which' called for closing on June 10, 2005.
¶ 13 For various reasons, the Filing 2 plat map was not recorded as expected. On June 15, 2005, Ryland agreed to waive its right to condition closing on the final approval of the Filing 2 plat map so it could proceed with closing. That same day, Ryland recorded a Memorandum of Contract giving notice of its intent to purchase all of Filing 2 except the Kelley Lots. However, Ochsner and Ryland then changed their agreement (apparently for tax reasons) to provide that Ochsner would convey all Filing 2 property, including the Kelley Lots, to Ryland at closing the next day, and Ryland would then sign a deed reconveying the Kelley Lots back to Ochs-ner.
¶ 14 Although the Ochsner-Kelley contract called for closing on June 10, those parties agreed to postpone closing. The Kelleys, however, did not know of or agree to the conveyance by Ochsner of the Kelley Lots to Ryland, or the agreement for reconveyance.
¶ 15 On June 16, 2005, Ochsner completed the sale to Ryland and recorded a deed that included the Kelley Lots. The same day, Ryland signed a deed reconveying the Kelley Lots to Ochsner, but did not record it. On June 22, ,2005, Ochsner signed a warranty deed conveying the Kelley Lots to the Kel-leys, but did not record it.
¶ 16 Ryland recorded the Ryan Ranch Filing 2 plat map on November 17, 2005. The plat map included the Kelley Lots. Pursuant to Ryland’s arrangement with Ochsner, the reconveyance deed, which conveyed the Kelley Lots from Ryland back to Ochsner, was recoi’ded on December 20, 2006. That same day, Ochsner recorded the deed conveying the Kelley Lots to the Kelleys.
¶ 17 Ryland never intended the recording of either the Filing 2 plat map or the Ry-land-Ochsner reconveyance deed to result in the annexation of the Kelley Lots into the Ryan Ranch community. Instead, Ryland understood and agreed that they would be excluded.
¶ 18 Although the evidence established that Ryland’s consistent procedure to annex property required recording a separate instrument entitled “Annexation of Additional Land to Declaration of Covenants, Conditions and Restrictions of Ryan Ranch Community Association,” no such instrument was recorded to annex the Kelley Lots. Although the Declaration recites a formula to calculate the reallocation of allocated interests upon annexation, none of the recorded instruments, including the Filing 2 plat map and the June 16, 2005, special warranty deed, states any resulting reallocation of the allocated interests or describes the common elements and the limited common elements created by annexation, or designates the unit to which each limited common element is allocated.
¶ 19 In June 2006, the Kelleys sold one of the Kelley Lots to a contractor who, after constructing a home on the property, sold that lot to the Zimmermans.
¶ 20 In September 2010, the HOA asserted, for the first time, that the Kelley Lots had been “automatically annexed” to the Ryan Ranch Community because of Ochs-ner’s conveyance to Ryland of all Filing 2 property, including the Kelley Lots, and Ry-land’s subsequent reconveyance of them to *379Ochsner. It therefore sought to recover past assessments, penalties, and fees from defendants.
¶ 21 The HOA’s complaint asserted claims for unpaid assessments, breach of contract, unjust enrichment, and foreclosure of liens it had recorded on the Kelley Lots.' The Kelleys and the Zimmermans counterclaimed for a declaratory judgment that Ryland did not annex the Kelley Lots in compliance with the Colorado Common Interest Ownership Act (CCIOA), sections 38-33.8-101 to -401, C.R.S.2013, or the Declaration, and asserted that principles of equitable conversion operated to preclude the transfer of the Kelley lots from Ochsner to Ryland.
¶ 22 Following discovery, the HOA moved for summary judgment, contending that annexation of the Lots had occurred, rendering them subject to the HOA’s assessments. Defendants requested the court to determine as a matter of law that the Declaration did not apply to their properties.
¶23 The trial court granted the HOA’s motion and denied defendants’ motion. The court first ruled that the Kelley lots had been properly annexed under CCIOA. Contrary to defendants’ arguments, the court ruled that the deeds, plat maps, ODP, and the Declaration, taken together, met the requirements of section 38-33.3-210, C.R.S.2013, which governs the exercise of development rights and requires preparation and recordation of an amendment to the Declaration. In reaching this conclusion, the court noted that CCIOA does not define “amendment,” but it relied on the definition of the term “declaration” contained in CCIOA that includes “any recorded instruments however denominated, that create a common interest community, including any amendments to those instruments and also including, but not limited to, plats and maps.” § 38-33.3-103(13), C.R.S. 2013. The court stated that it would not overly rely on the form of the purported amendment, but would instead focus on whether the instruments as a whole formally revised or added to a relationship that constituted a common interest community.
¶ 24 The court noted that the deed of June 16, 2005, from Ochsner to Ryland conveyed all of Filing 2, which included the Kelley Lots, and that the deed also included an exhibit, entitled “permitted exceptions,” which explicitly refers to an exception for all notes, terms, provisions, and conditions as shown on the final, plat of Ryan Ranch Filing 2, dated -May .26, 2005. That plat, the court noted-, included the obligation of a homeowners association to maintain various properties, and it concluded that the Kelleys were on inquiry notice of the language of the deed to subject their land to the covenants found in the ODP, which was recorded in January 2001, and the Declaration, which was recorded in March 2005.
¶25 The trial court next ruled that the exercise of the development rights over Ryan Ranch Filing 2 complied -with the Declaration. It concluded that Ryland was the owner of the Kelley Lots at the time of annexation and rejected defendants’ argument that the Kelleys were the equitable owners under the doctrine of equitable conversion. It also concluded that the Declaration did not require the use of a specific form to annex the Kelley Lots.
¶ 26 Finally, the court rejected defendants’ contention that the parties involved in these various transactions never intended that the Kelley Lots would become part of the Ryan Ranch Community. The court reasoned that no one provided notice to future members of the HOA that the lots would be excluded and that the contract between Ryland and the Kelleys could not bind the HOA, Further it held-that, even if the intent of Ryland and the Kelleys was. to exclude the lots, the legal effect of Ryland’s actions was to subject the Kelley Lots to the Declaration, and that a mistake of law could not erase the legal effect of Ryland’s actions. The court also held that it would be inequitable not to subject the Kelley Lots to the Declaration because they had received benefits from landscaping, snow removal, and other services provided by the HOA to property adjacent to the Kelley Lots. The parties later stipulated to the amount that was owed, and the court entered a final judgment that also awarded attorney fees to the HOA.
¶ 27 This appeal followed.
*380II. Summary Judgment
¶28 Defendants contend that the court erred in granting summary judgment for the HOA, They raise thre'é arguments: (1) the Kelley Lots were not annexed in compliance with CCIOA; (2) Ryland did not annex the Kelley Lots in compliance with the Declaration; and (3) Ryland did not “own” the Kelley Lots at the time of the alleged annexation. We agree with the first contention and thus need not address the remaining assertions,
A. Standard of Review
¶ 29 Summary judgment is appropriate when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits filed by the parties, demonstrate that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. See C.R.C.P. 56(c). We review de novo an order granting summary judgment.. McIntyre v. Bd. of Cnty. Comm’rs, 86 P.3d 402, 406 (Colo. 2004),
¶ 30 We also review a trial court’s interpretation and application of the law de novo. Asphalt Specialties, Co. v. City of Commerce City, 218 P.3d 741, 745 (Colo.App.2009) (statutory interpretation is a question of law subject to de novo review). Likewise, we construe restrictive covenants de novo, Rossman v. Seasons at Tiara Rado Assocs., 943 P.2d 34, 36 (Colo.App.1996), as well as deeds, Dep’t of Transp. v. First Place, LLC, 148 P.3d 261, 264 (Colo.App.2006), and declarations of ’ covenants, conditions, and déscrip-tions, Buick v. Highland Meadow Estates at Castle Peak Ranch, 21 P.3d 860, 862 (Colo. 2001).
B. Law
¶ 31 CCIOA affects all the transactions involved here, and the Declaration specifically states that in the event of any conflict with CCIOA, the statute prevails over the Declaration. Indeed, “[ejxcept as expressly provided [in CCIOA], provisions of [CCIOA] may not be varied by agreement, and rights conferred by [CCIOA] may not be waived.” § 38-33.3-104, C.R.S.2013. Accordingly, we first set forth the applicable statutory provisions.
¶ 32 CCIOA was enacted by the General Assembly in order to establish “a clear, comprehensive, and uniform framework for the creation and operation of common interest communities;” § 38-33.3-102(l)(a), C.R.S. 2013. A common interest community is real estate described in a declaration that is subject to the payment of certain obligatory fees, such as real estate taxes, insurance premiums, and maintenance or improvement costs. § 38-33.3-103(8), C.R.S.2013.
¶ 33 A common interest community is created by recording a declaration in the real property records. § 88-33.3-201(1), C.R.S. 2013. A declaration describes the real property to be included in the common interest community and may include plats and maps describing the real estate affected. See § 38-33.3-103(13), C.R.S.2013. Additionally, a declaration must contain a description of any development rights and other special rights reserved by the declarant. § 38-33.3-205(l)(h), C.R.S.2013.
¶ 34 Section. 38-33.3-210(1), C.R.S.2013, describes the procedures for exercising a retained development right. A declarant may add property to a-common interest community that was not included at the time the declaration was recorded by exercising a development right reserved, for such purpose. See § 88-33.3-103(14)(a), C.R.S.2013 (“Development rights’.’ include “any right or combination, of rights reserved by a declarant in the declaration to ... [a]dd real estate to a common interest community,” among others.)
¶35 To exercise such rights, a developer must comply with the plat and map requirements of section 38-33.3-209, C.R.S.2013, and prepare, execute, and record an amendment to the declaration. § 38-33.3-210(1). The latter statute prescribes how a declaraht may exercise the right to annex or add real property. The declarant must
prepare, execute, and record an amendment to the declaration and, in, a ... planned community, comply with the provisions of section 38-33.3-209.... The amendment to the declaration must assign an identifying number to each new unit created and .... reallocate the allocated *381interests among all units. The amendment must describe any common elements and any limited common elements thereby created and, in the case of limited common elements, designate the unit to which each is allocated to the extent required by section 38-33.3-208.

Id

¶ 36 Further, section 38-33.3-217(3), C.R.S.2013, requires that an amendment to the declaration must be properly indexed:
Every amendment to the declaration must be recorded in every county in which any portion of the common interest community is located and is effective only upon recor-dation. An amendment must be indexed in the grantee’s index in the name of the common interest community and the association and in the grantor’s index in .the name of each person executing the amendment.
C. Application
¶ 37 Defendants assert that, to exercise reserved development rights, CCIOA requires the recording of an amendment to the declaration, which must contain certain information and be properly indexed. They assert that the trial court erred in concluding that the recording of the ODP and the Declaration itself, when considered together with the Oehsner-Ryland deed conveying the. Kelley Lots and the filing of the Filing 2 plat map, could constitute a. valid amendment. We agree.
¶38 CCIOA does not define the term “amendment.” Accordingly, we must determine the meaning of that term.
¶ 39 Our primary duty in interpreting statutes is to give full effect to the intent of. the General Assembly. Colo. Water Conservartion Bd v. Upper Gunnison River Water Conservancy Dist., 109 P.3d 585, 593 (Colo. 2005). If statutory terms are clear, we apply them according to their plain and ordinary meaning. Anderson v. Longmont Toyota, Inc., 102 P.3d 323, 326 (Colo.2004). We may discern such meaning from the context in which statutory terms appear, by reference to the meaning of other terms associated with them, Platt v. Aspenwood Condo. Ass’n, 214 P.3d 1060, 1063 (Colo.App.2009), and by reference to the dictionary, People v. Thoro Prods. Co., 70 P.3d 1188, 1194 (Colo.2003).
¶40 The term “amendment” is generally understood to mean “[a] formal revision or addition proposed or made to a statute, constitution, pleading, order, or other iristriiment; specif., a change made by addition, deletion,' or correction,” Black’s Law Dictionary 94 (9th ed.2009).
¶ 41 From this definition we discern two things. First, there must be an object to which an amendment will relate, Here, the object is a declaration. See § 38-33.8T210(l) (“amendment to the .declaration”). Second, there must be a revision, addition, or change to that declaration, which connotes that an amendment chronologically follows its earlier, object.
¶42 Employing that definition here, we conclude that the trial court erred in relying upon the ODP. and the Declaration itself in determining whether Ryland properly “amended the declaration,” because those documents were created and recorded before the purported annexation. For that reason, they could not revise, add to, or' change the Declaration. One cannot logically consider the original document to constitute a change or addition to itself. See § 38-33.3-209(6) (“Upon exercising any development right, the declarant shall record an amendment to the declaration with respect to that real estate reflecting change as a result Of such exercise.” (emphasis added)).
¶ 43 Furthermore, the statute requires “the declarant” to prepare, execute, and record the amendment to the declaration. § 38-33.3-210(1). The ODP was not prepared by Ryland. See § 38-33.3-103(12) (defining “declarant” as “any person or group of persons acting in concert who (a) ... offers to dispose of to a purchaser such declarant’s interest in a unit not previously disposed of to a purchaser; or (b) [reserves or succeeds to any special declarant right”),.
¶44 In addition, even if those two documents could be considered part of an amendment, they add nothing to the analysis of whether an amendment to the Declaration annexing the Kelley .Lots occurred here. *382Kelley signed the ODP below a statement that he “as owner of the land affected by this Planned Development, accept[s] and ap-provers] all conditions set forth herein.” But the only pertinent condition stated in the ODP was an acknowledgment that there would be a mandatory homeowners association. The ODP does not contain covenants or subject the property to any future covenants that might be contained in the Declaration. Hence, it could not “affirm [the Kel-leys’] acceptance of the conditions imposed by the Ryan Ranch planned development,” as the trial court held. At most, the ODP places a purchaser on notice that a mandatory homeowners association would be formed.
¶ 45 The trial court also relied on the Ochsner-Ryland deed of June 16, 2005, which contains an “Exhibit B,” listing the Filing 2 plat map as an exception to the general warranty clause. The court stated that the Kelleys would have been on “inquiry notice of the language in the instrument to subject their land to the covenants found in the [ODP] and in the Declaration.” However, no language in the deed actually subjects the property to the Declaration or annexes the Kelley Lots. The deed merely excepts “covenants, conditions ... and rights of way of record, if any” from the warranty of title. See § 38-30-113(2), C.R.S.2013 (“the words ‘warrants) the title’ in a warranty deed as described in subsection (l)(a) of this section ... mean that the grantor covenants: ... (b) [t]hat the same was free and clear from all encumbrances, except as stated in the instrument”); O’Brien v. Vill Land Co., 794 P.2d 246, 250 (Colo.1990) (a covenant of general warranty is a guarantee that the grantor is vested of an estate in fee simple with full power to convey, that the property is free of all encumbrances except as listed in the deed, and that the grantor will guarantee title; exceptions inserted into a covenant of warranty are intended only to protect the grantor on the warranty).
¶ 46 In addition, the deed does not satisfy the requirements set forth in section 38-33.3-210. It does not denominate itself as an amendment; it does not assign an identifying number to each new unit created, or reallocate the allocated interests among all units; it does not describe any common elements thereby created; and it was not properly indexed in the name of the Ryan Ranch community.
¶ 47 Furthermore, the HOA has pointed to nothing in the Ryan Ranch Filing 2 plat map that subjects the property described in it to the Declaration, nor have we found any. The Filing 2 plat map does not amend the Declaration—it simply subdivides Tract H of Ryan Ranch Filing 1 into separate lots, blocks, and tracts of land and denominates it as Filing 2.
¶ 48 Moreover, the Filing 2 plat map did not annex any additional property into the Ryan Ranch Community, or reallocate the allocated interests of all the lots it created. Nor was it properly recorded in the grantor-grantee indices as required by section 38-33.3-210.
¶ 49 It is true that some of the restrictions in the Filing 2 plat map anticipate obligations of the HOA to maintain landscaped areas and access drives, including portions adjacent to the Kelley lots. But this easts no light on whether the map constitutes an amendment or complies with statutory requirements therefor.
¶ 50 Accordingly, even viewing the ODP, Declaration, the Ochsner-Ryland deed, and the Filing 2 plat map together, they do not constitute an amendment to the Declaration within the meaning of section 38-33.3-210 sufficient to annex the Kelley lots, and the trial court erred in so concluding.
¶ 51 The HOA nevertheless contends that section 38-33.3-210 does not apply because annexation of the Kelley Lots did not require exercise of reserved declarant rights. It also asserts that the Kelley Lots were included within the original Declaration. We disagree.
¶ 52 We first note that the HOA did not make these arguments in the trial court. Even so, because we may affirm a correct judgment for any reason supported by the record, see Rush Creek Solutions v. Ute Mtn. Ute Tribe, 107, P.3d 402, 406 (Colo.App.2004), we will address them.
¶ 53 Under section 38-33.3-210(1), the de-clarant must prepare an amendment “to ex-*383ereise any development right reserved under section 38-33.3-205(l)(h).” Thus, section 210(1) only applies when a development right is reserved under section 205(l)(h).
¶ 54 Section 38-33.3-205(1) describes what a declaration must contain, and in subsection (h) specifies that it must include “[a] description of any development rights and other special declarant rights reserved by the de-clarant.” • “Development rights,” in turn, is defined in section 38-33.3-103(14) as “any right or combination of rights reserved by a declarant in the declaration to: (a) [a]dd real estate to a common interest community.”
¶ 55 Accordingly, annexation of property, which adds real estate to a common interest community, is a development right, see Miller v. Curry, 203 P.3d 626, 629 (Colo. App.2009) (“CCIOA governs how a common interest community is created, altered, and terminated,” (emphasis added)), and compliance with section 38-33.3-210 is required. See § 38-33.3-210(1) (to exercise a development right, that is, to annex, “the declarant shall prepare ... an amendment to the declaration”); § 38-33.3-209(6), C.R.S.2013 (“the declarant shall record an amendment to the declaration”); § 38-33.3-217(3), C.R.S. 2013 (every amendment to the declaration “must be recorded” (emphasis added)); Willhite v. Rodriguez-Cera, 2012 CO 29, ¶ 17, 274 P.3d 1233 (“the word ‘shall’ connotes a mandatory requirement”); Silverview at Overlook, LLC v. Overlook at Mt. Crested Butte, 97 P.3d 252, 255 (Colo.App.2004) (under CCIOA, “[u]se of the word ‘must’ connotes a requirement that is mandatory and not subject to equivocation.”)
¶ 56 CCIOA therefore requires an amendment to the Declaration to accomplish annexation. See §§ 38-33.3-104, 38-33.3-203(3), C.R.S. 2013 (declaring that CCIOA trumps any inconsistent declaration term); Abril Meadows Homeowner’s Ass’n. v. Castro, 211 P.3d 64, 68 (Colo.App.2009) (if the declaration does not comply with CCIOA, the declaration is invalid and unenforceable); Miller, 203 P.3d at 629 (failure to include reservation of development rights as required by statute meant no rights were retained); Snowmass Land Co. v. Two Creeks Homeowners’ Ass’n, 159 P.3d 662, 664-65 (Colo.App.2006) (reservation of development rights failed because it did not comply with statutory requirement).
¶ 57 The logical extension of this conclusion is that the different method for annexation set forth in the Declaration cannot apply here because it does not comport with the requirements of -section 38-33.3-210. Hence, we need not address whether the purported annexation complied with that term of the Declaration; and the trial court’s conclusion that annexation of the Kelley Lots was accomplished by following the method set forth in the Declaration was therefore incorrect.
¶ 58 The HOA next asserts that because the Kelley Lots were mentioned in the Declaration, they were always within the homeowners association and thus amendment of the Declaration under CCIOA was not required for annexation. We reject the assertion.
¶ 59 As previously noted, the Declaration provides that its covenants, conditions, and restrictions encumber the real property described on its Exhibit A That exhibit describes the community as “Tract A, B, C, E, F, and G, Ryan Ranch Filing 1.” But the Kelley Lots were contained at that time in Tract H, Ryan Ranch Filing 1, and thus, they were not part of the real property subjected to the original Declaration.
¶ 60 The Declaration also states that “[a]d-ditional [pjroperty will be annexed into the Community in accordance with this Declaration.” Exhibit D to the Declaration declares that “all or any portion of Tract H” is “an-nexable property.” This term, in our view, means that the property described is capable or susceptible of being annexed. See Random House Webster’s College Dictionary 4 (1991) (defining the suffix “-able”). The tem-porality of the term in the Declaration (“will be annexed”) and the use of “annexable” in Exhibit D leads us to conclude that the property described in Exhibit D was not part of the property being subjected to the original Declaration but, instead, would be capable in the future of being so subjected and annexed provided some additional action were taken. The additional actions that were taken and upon which the trial court relied, however, did not comply with section 38-33.3-210(1). *384And absent annexation in compliance with that provision, the Kelley Lots never became subject to the Declaration’s encumbering language.
¶ 61 The HOA also asserts that the doctrines of actual and inquiry notice preclude granting relief to defendants, because they had notice or knowledge of the various instruments recorded in their chain of title when they received the deeds conveying the Kelley Lots to them. However, the HOA has cited no authority for the proposition that defendants’ imputed knowledge of., the real estate records defeats our conclusion that the Kelley Lots were never subject to the obligations set forth in the Declaration. Indeed, our conclusion that the Kelley Lots are not subject to the Declaration’s terms makes it clear that the real estate records cannot have created any such notice or knowledge.
¶ 62 Nor are we persuaded that a different result is required by the Restatement (Third) of Property: Servitudes § 6.6(1) (2000), upon which the HOA relies. That section specifies that a homeowners association has the power to raise funds reasonably necessary to carry out its functions by levying assessments against the individually owned property in the community. Here, however, our conclusion that the Kelley Lots are not “within the community” defeats the application of that provision,
¶ 63 In light of our conclusion that the Kelley Lots were not rendered subject to the terms of the Declaration, we need not address defendants’ remaining contentions.
¶ 64 Our determination resolves the HOA’s claims for breach of contract, recovery of unpaid assessments, and foreclosure of liens (which are invalid in light of our conclusion). It also requires that we vacate the trial court’s award of attorney fees and costs to the HOA. However, we do not perceive that our determination necessarily resolves the unjust enrichment claim or the affirmative defenses the HOA raised in response to the counterclaims asserted by the Kelleys and the Zimmermans.
¶ 66 In a stipulation attached to the HOA’s motion for entry of judgment, filed after the trial court granted the summary judgment, the parties stipulated to dismiss the unjust enrichment claim. However, no formal dismissal of the claim appears of record, and the terms of the stipulation indicate that the unjust enrichment claim was to be dismissed only if the court entered a money judgment on the assessment and breach of contract claims; In light of our reversal, the status of the. unjust enrichment claim is unclear, Accordingly, on remand, the trial court must revisit that claim and determine whether, in light of our conclusion, the unjust enrichment claim remains viable and, if so, what further proceedings may be necessary. We express no opinion concerning the merits of such a claim.
¶ 66 The trial court must also consider whether any affirmative defenses defeat or limit a recovery on defendants’ counterclaims.
III. Attorney Fees
¶ 67 All parties request attorney fees. Under the Declaration and section 38-33.3-123(l)(c), C.R.S.2Ó13, a prevailing party in a CCIOA dispute is entitled to reasonable attorney fees. Because it is not a prevailing party, we deny the request of the HOA. Because we conclude that defendants are the prevailing parties, we award attorney fees to defendants against the HOA. We exercise our discretion under C.A.R. 39.5 to remand the matter to the trial court to determine the amount of trial and appellate attorney fees to be awarded to defendants, and also to determine whether the HOA’s affirmative defenses limit or preclude such an award. See Hallmark Bldg. Co. v. Westland Meadows Owners Ass’n, Inc., 983 P.2d 170, 174 (Colo. App.1999),
IV. Conclusion
¶ 68 The judgment is reversed, and the case is remanded to the trial court for further proceedings on the unjust enrichment claim and for entry of an award of reasonable attorney fees and. costs in favor of defendants.
*385JUDGE ASHBY concurs.
JUDGE TERRY dissents.