Court Opinion

ID: 9394368
Source: CourtListenerOpinion
Date Created: 2023-05-14 14:07:11.107859+00
Date Added: 2024-06-11T17:18:59.240577
License: Public Domain

Supreme Court of Texas
                             ══════════
                              No. 21-1063
                             ══════════

   In re Christopher S. Kappmeyer and Roxana P. Kappmeyer,
                                 Relators

   ═══════════════════════════════════════
           On Petition for Writ of Mandamus
   ═══════════════════════════════════════

                      Argued December 1, 2022

      JUSTICE LEHRMANN delivered the opinion of the Court.

      In this mandamus proceeding arising out of a dispute between
property owners and a homeowners association regarding enforcement
of amended restrictive covenants, the plaintiff owners challenge the trial
court’s order requiring them to join all 700 other owners in the
subdivision as parties or face dismissal of their suit. We hold that the
trial court abused its discretion in compelling joinder of the other owners
and that the plaintiffs lack an adequate appellate remedy. Accordingly,
we conditionally grant relief and order the trial court to vacate its order.

                             I. Background

      The Key Allegro Island Estates subdivision is located on an island
in Aransas Bay near Rockport, Texas. Key Allegro is divided into five
sections, or “units.” Relators Christopher and Roxana Kappmeyer own
three lots in Unit I, which comprises approximately 190 properties; in
total, Key Allegro comprises approximately 700 properties. Some are
bayfront properties, while others abut one of the canals that crisscross
the island.
      Between 1962 and 1974, the subdivision’s developer executed and
recorded restrictive covenants for each of the five units. The documents
are essentially identical and largely consist of architectural and use
restrictions. They do not provide for mandatory association dues or
assessments of any kind. In fact, they contain only a single reference to
an owners association in a paragraph discussing canal maintenance:
      [Each lot owner is] responsible for the maintenance of the
      portion of any channel contiguous to his property in
      accordance with the provisions hereof.         The KEY
      ALLEGRO CANAL OWNERS ASSOCIATION shall have
      the privilege of curing any default of the owner of such
      property in connection with the foregoing at any time and
      any reasonable expense incurred in so doing shall be paid
      by the owner of such property.
      The parties appear to agree that each unit was also subject to an
“Agreement Relating to Owners of Property on Designated Canals and
Waterways,” which conferred on the referenced Canal Owners
Association the duty to maintain certain quasi-public areas and the
authority to levy related assessments and liens against owners of canal-
adjacent lots. Those agreements are not in the mandamus record, so the
scope of the association’s maintenance responsibilities and related
assessment authority is unclear. However, none of the Kappmeyers’ lots
are adjacent to a canal, and it appears undisputed that they were not
subject to assessments under the agreements or the original restrictive
covenants.

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       In 2017, the Board of Directors of the Key Allegro Canal and
Property Owners Association (Association)—successor to the Canal
Owners Association by “de facto merger”—executed “Amended and
Restated Deed Restrictions, Covenants and Conditions” for each of the
five units. Like the original restrictions, the amended restrictions for
each unit are essentially identical, and each document states that it
amends all prior recorded deed restrictions pertaining to the associated
unit. The amended restrictions differ from the originals in several key
respects, including authorizing the Association: to enforce the
restrictions; to cure an owner’s default on various maintenance
obligations, be reimbursed by the owner, and impose a lien for
unreimbursed costs; to make additional rules and regulations consistent
with the restrictions; and to impose a lien for unpaid dues and
assessments. 1 The subdivision’s property owners did not vote on the
amended restrictions prior to their adoption.
       The Kappmeyers sued the Association, requesting a declaratory
judgment that the Unit I amended restrictions “cannot be enforced
against them” because (1) the required percentage of owners did not
approve the amended restrictions; 2 (2) if the amended restrictions are
Board rules, they conflict with the original restrictions; and (3) the
amended restrictions impose new and additional restrictions against an

       1 According to the Association’s president, at the time of the trial court’s
hearing on the underlying motion, the annual dues were $321 for an off-canal
lot and $424 for an on-canal lot.
       2  The Kappmeyers allege that an amendment to the restrictions is
invalid unless 100% of the owners—or, in the alternative, 67% of the owners
or, in the further alternative, a majority of the owners—vote to adopt it.

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existing owner. The Kappmeyers alternatively asserted a claim to quiet
title “as against any [Association] lien or claim” by virtue of the amended
restrictions, as well as a claim that the Association breached the original
restrictions by exercising powers beyond those authorized therein.
      The Association filed a motion to abate the claims for declaratory
relief until the Kappmeyers joined all necessary parties to the suit—
specifically, all Key Allegro property owners or, alternatively, all Unit I
owners. They argued that the relief the Kappmeyers seek requires a
finding that the Board lacked the power to adopt the amended
restrictions, which would affect all owners. They further argued that
such a declaration subjects the Association to the possibility of being
sued by other owners, putting it at risk of multiple or inconsistent
obligations.   The trial court granted the motion and ordered the
Kappmeyers to join and serve all Key Allegro property owners within
90 days or face dismissal of their declaratory-judgment claims. The
court of appeals denied the Kappmeyers’ petition for writ of mandamus,
leading them to seek mandamus relief in this Court.

                             II. Discussion

      Mandamus relief is an extraordinary remedy requiring the
relator to show that (1) the trial court clearly abused its discretion and
(2) the relator lacks an adequate remedy by appeal. In re Prudential
Ins. Co. of Am., 148 S.W.3d 124, 135–36 (Tex. 2004). We examine each
element in turn.

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                          A. Abuse of Discretion

       A trial court abuses its discretion when it acts with disregard of
guiding rules or principles or in an arbitrary or unreasonable manner.
In re Garza, 544 S.W.3d 836, 840 (Tex. 2018). A trial court’s “failure to
analyze or apply the law correctly is an abuse of discretion.” In re Am.
Homestar of Lancaster, Inc., 50 S.W.3d 480, 483 (Tex. 2001) (citation
omitted). Here, we consider whether the trial court failed to correctly
analyze or apply the law governing compelled joinder of parties.
       When a party seeks to compel joinder of persons as parties to a
proceeding, including a declaratory-judgment action, Texas Rule of Civil
Procedure 39 governs. Crawford v. XTO Energy, Inc., 509 S.W.3d 906,
911 n.3 (Tex. 2017) (citing Brooks v. Northglen Ass’n, 141 S.W.3d 158,
162 (Tex. 2004)). 3 Rule 39 describes the following persons who “shall be
joined”:
       (a) Persons to Be Joined if Feasible. A person . . . shall
       be joined as a party in the action if
         (1) in his absence complete relief cannot be accorded
       among those already parties, or

       3   The Uniform Declaratory Judgments Act states that “[w]hen
declaratory relief is sought, all persons who have or claim any interest that
would be affected by the declaration must be made parties.” TEX. CIV. PRAC.
& REM. CODE § 37.006(a). However, unlike Rule 39, the Act does not authorize
a court to compel joinder; rather, it confirms that a declaration “does not
prejudice the rights” of nonparties to the proceeding. Id.; TEX. R. CIV. P. 39(a)
(“If [a necessary party] has not been so joined, the court shall order that he be
made a party.”). Thus, “Rule 39 determines whether a trial court has authority
to proceed without joining a person whose presence in the litigation is made
mandatory by the Declaratory Judgment[s] Act.” Brooks, 141 S.W.3d at 162.

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         (2) he claims an interest relating to the subject of the
      action and is so situated that the disposition of the action
      in his absence may
             (i) as a practical matter impair or impede his ability
      to protect that interest or
             (ii) leave any of the persons already parties subject
      to a substantial risk of incurring double, multiple, or
      otherwise inconsistent obligations by reason of his claimed
      interest.
         If he has not been so joined, the court shall order that
      he be made a party. . . .
TEX. R. CIV. P. 39(a) (formatting altered). The Association does not
argue that joinder is required under Rule 39(a)(1).
      As to Rule 39(a)(2), our opinion in Brooks forecloses any assertion
that joinder is required under subsection (i). 141 S.W.3d at 163. In that
case, which involved a declaratory-judgment action by eight property
owners challenging their homeowners association’s attempt to increase
assessments and impose late fees, we confirmed that because the
Declaratory Judgments Act provides that a trial court’s declaration does
not prejudice the rights of nonparties, “[a]ny non-joined homeowner
would be entitled to pursue individual claims contesting [the
association’s]   authority   to   raise   assessments   or   impose   fees,
notwithstanding the trial court’s judgment in the current case.” Id.
Accordingly, Rule 39(a)(2)(i) did not require joinder of the other
homeowners, whose absence did not impair their ability to protect
whatever interest they had in the litigation. Id. Here, it is equally true
that the nonparty Key Allegro property owners may pursue individual
claims contesting the Association’s authority to enforce the amended
restrictions and that the outcome of the Kappmeyers’ suit does not affect

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their ability to do so. Accordingly, Rule 39(a)(2)(i) did not authorize the
trial court to compel the Kappmeyers to join the other owners.
       The Association principally relies on Rule 39(a)(2)(ii), which
requires joinder of a person who “claims an interest relating to the
subject of the action and is so situated that the disposition of the action
in his absence may . . . leave any of the persons already parties subject
to a substantial risk of incurring double, multiple, or otherwise
inconsistent obligations by reason of his claimed interest.” TEX. R. CIV.
P. 39(a)(2)(ii). Applying this rule requires a two-step inquiry. First,
does the person whose joinder is sought “claim[] an interest relating to
the subject of the action”? Id. Second, will disposition of the action in
the person’s absence leave any of the current parties “subject to a
substantial risk of incurring double, multiple, or otherwise inconsistent
obligations by reason of his claimed interest”? 4 Id. If the answer to
either of those questions is no, then Rule 39 does not mandate joinder of
that person and, in turn, does not authorize the trial court to order that
he be made a party. See Crawford, 509 S.W.3d at 912.
       We begin with whether the absent property owners “claim[] an
interest relating to the subject of the action.” Our opinion in Crawford
is instructive in answering that question, and we examine it in some

       4 In Brooks, we recognized and “appreciate[d] the risk that, unless each
homeowner is joined in one suit, [the association] may be subject to
inconsistent judgments.” 141 S.W.3d at 163. We ultimately held that the
association waived error by failing to complain in the trial court about the
absence of the nonjoined owners; thus, we did not engage in the two-step
analysis necessary to evaluate whether joinder was required under
Rule 39(a)(2)(ii). Id.

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detail. In that case, Crawford asserted ownership of the “Crawford
tract” mineral estate (as an heir of the prior owner) and sued lessee XTO
Energy for failing to make royalty payments on mineral production from
the tract. Id. at 908–09. XTO took the position that, by virtue of the
common-law “strip and gore” doctrine, 5 the prior owner had conveyed
the Crawford tract to the owners of property adjacent to that tract and
that those owners, not Crawford, were entitled to the royalties Crawford
demanded. Id. The principal issue in this Court was whether the trial
court abused its discretion in granting XTO’s motion to abate and
compel joinder of the forty-four adjacent owners under Rule 39 and in
dismissing Crawford’s suit when he failed to join them. Id. at 909.
      XTO argued that the adjacent owners claimed an interest relating
to the subject of the suit by virtue of their alleged ownership interest in
the Crawford-tract minerals. Id. at 911. In rejecting this argument, we
elaborated on the meaning of “claim” in the Rule 39 context, explaining
that it means “to demand recognition of (as a title, distinction,
possession, or power) esp. as a right”; “to demand delivery or possession
of by or as if by right”; and “to assert or establish a right or privilege.”
Id. at 912 (citation omitted). We held that the owners’ own deeds and

      5   Under the strip-and-gore doctrine:
      Where it appears that a grantor has conveyed all land owned by
      him adjoining a narrow strip of land that has ceased to be of any
      benefit or importance to him, the presumption is that the
      grantor intended to include such strip in such conveyance;
      unless it clearly appears in the deed, by plain and specific
      language, that the grantor intended to reserve the strip.
Crawford, 509 S.W.3d at 909 (quoting Cantley v. Gulf Prod. Co., 143 S.W.2d
912, 915 (Tex. 1940)).

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leases reflected no such “claim” to the royalties attributable to the
Crawford tract, nor had the owners taken any other action to “demand”
or “assert” a right to any of those royalties. Id. at 913. Importantly,
although we recognized that the adjacent owners necessarily had a
pecuniary interest in the outcome of the litigation because it impacted
their royalty payments, we deemed it significant that XTO had
unilaterally made the determination to credit the Crawford-tract
royalties to those owners. Id. That the owners could claim an interest
in the subject of the action did not render joinder mandatory under
Rule 39; rather, the rule “requires joinder, in certain circumstances, of
persons who actually claim such an interest.” Id. (emphasis added).
       Here, the absent Key Allegro property owners—or at least the
absent Unit I owners—certainly could claim an interest in the
enforceability of the amended restrictions against a particular owner
like the Kappmeyers. 6 For example, they could have voted for or against
adopting the amended restrictions.        But the Kappmeyers’ principal
complaint is that the amended restrictions were not put to a vote of the
Key Allegro owners at all; just as the lessee in Crawford made the
unilateral decision to pay royalties to the absent property owners, here,
the Association’s Board unilaterally made the determination to adopt

       6Arguably, the owners of property in the other units could not even do
that, as each unit is governed by its own set of declarations and the
Kappmeyers challenge only the Unit I restrictions. But we need not address
whether those owners should be treated differently for purposes of the Rule 39
analysis because we hold that the rule does not authorize joinder even as to
the Unit I owners.

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amended property restrictions. 7 And the Association points to no action
on the property owners’ part that amounts, either directly or indirectly,
to demanding or asserting an interest in enforcing (or not enforcing) the
amended restrictions against a particular owner. See Epernay Cmty.
Ass’n v. Shaar, 349 S.W.3d 738, 746 (Tex. App.—Houston [14th Dist.]
2011, no pet.) (holding that joinder of other property owners was not
required in owners’ suit seeking a declaration that the homeowners
association lacked authority to assess fees against the plaintiffs, in part
because they had not sought a declaration regarding the rights of other
owners). 8
         The distinction we highlighted in Crawford between persons
“having” an interest that could be claimed and actually “claiming” that
interest makes sense in the Rule 39(a)(2) context precisely because it
involves compelling their joinder in a lawsuit. Here, the trial court has
required the Kappmeyers to sue several hundred additional parties who
may or may not, colloquially speaking, have a dog in the Kappmeyers’
fight.

         We express no opinion on the Board’s authority to do so or on the
         7

merits of the Kappmeyers’ claims.
         8In holding that the trial court did not abuse its discretion in denying
the motion for joinder in Epernay, the court of appeals also noted that the
Association “did not provide the trial court with any evidence as to the identity,
number, or interests of these other homeowners.” 349 S.W.3d at 747. Here,
the Association correctly notes that it provided the trial court with a
spreadsheet identifying the Key Allegro property owners.                But that
spreadsheet does not change the scope of the relief the Kappmeyers seek or
clarify the interest the absent property owners purportedly “claim.”

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       The Association argues that unlike the adjacent owners in
Crawford, the Key Allegro owners claim an interest in the litigation
through their deeds because the litigation necessarily impacts their
inherent property rights. See Inwood N. Homeowners’ Ass’n v. Harris,
736 S.W.2d 632, 636 (Tex. 1987) (noting that “the right to require that
all property owners pay assessment fees is an inherent property right”).
Specifically,   the   Association   argues   that   the   declaration   the
Kappmeyers seek will impact other owners, citing the Association’s
president’s testimony that it would revert the Key Allegro governing
documents back to the original restrictions. In support, the Association
cites April Sound Management Corp. v. Concerned Property Owners for
April Sound, Inc., in which a subdivision’s developer sought a
declaratory judgment that it had the right, under the deed restrictions
applicable to the subdivision, to adjust, waive, or discontinue the
maintenance charge that the restrictions imposed on all subdivision
owners. 153 S.W.3d 519, 521 (Tex. App.—Amarillo 2004, no pet.). The
court of appeals held that such a judgment “would, in effect, change the
rights and interests of each property owner in the association,” making
them all necessary parties under Rule 39. Id. at 526; see also Dahl v.
Hartman, 14 S.W.3d 434, 436–37 (Tex. App.—Houston [14th Dist.] 2000,
pet. denied) (holding that all property owners in a subdivision were
necessary parties where the plaintiff owner sought broad declaratory
relief that the subdivision’s deed restrictions had not been extended and
a homeowners association had not been formed).
       As we made clear in Crawford, however, the fact that the ultimate
judgment could affect nonparties does not in itself require their joinder

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under Rule 39. In that case, compelling joinder of the absent adjacent
property owners was improper even though the judgment sought would
have a direct pecuniary effect on them in the form of a reduction in the
amount of royalties they would receive. See Crawford, 509 S.W.3d at
913. Again, the difference between having an interest and claiming one
is at the heart of the Rule 39(a)(2) analysis. See id. (“[T]he landowners
did not need to actually come to court to assert an interest in order to
claim an interest under Rule 39. But they needed to do something, and
the adjacent landowners have done nothing.” (cleaned up)). 9
       Because the absent Key Allegro owners do not “claim[] an interest
relating to the subject of the action,” the trial court abused its discretion

       9  In holding that the adjacent property owners in Crawford did not
claim an interest in the subject of the litigation “solely by virtue of their deeds
and leases,” we explained that those deeds and leases did not even describe the
disputed tract. 509 S.W.3d at 912. That fact, we held, distinguished Crawford
from earlier decisions, including precedent from this Court, involving oil-and-
gas leases and title disputes in which joinder of nonparty lessors was required.
See id. at 912–13 (citing, inter alia, Veal v. Thomason, 159 S.W.2d 472, 477
(Tex. 1942) (holding that all property owners who executed leases on a unitized
block were necessary parties in a suit to cancel one of the leases)). The
Association argues that this case is not similarly distinguishable, as the Key
Allegro owners undisputedly have an ownership interest in property in the
subdivision. However, a significant legal distinction between Veal and
Crawford, which we did not discuss in the latter opinion, is that Veal predated
Rule 39, which requires joinder of a person who “claims” an interest under
certain circumstances; Veal instead applied a common-law rule that defined
“necessary parties” as “such persons as have or claim a direct interest in the
object and subject matter of the suit and whose interests will necessarily be
affected by any judgment that may be rendered therein.” 159 S.W.2d at 477
(emphasis added) (citation omitted). As discussed, under our modern
procedural rules the difference between “having” an interest and “claiming”
one is meaningful for joinder purposes. For that reason, Veal and its progeny
are of limited usefulness in analyzing the issue.

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in compelling the Kappmeyers to join those owners under Rule 39(a)(2).
However, we note, as we did in Crawford, that the Association is not
without recourse. To the extent it has legitimate concerns about future
litigation involving other owners, the Association may seek to join those
owners as parties under Rule 37. TEX. R. CIV. P. 37 (“Before a case is
called for trial, additional parties necessary or proper parties to the suit,
may be brought in, either by the plaintiff or the defendant, upon such
terms as the court may prescribe; but not at a time nor in a manner to
unreasonably delay the trial of the case.”). And nothing prevents the
Association from notifying the other owners of the underlying action in
an effort to determine the most efficient course of action. But it is not
entitled to an order requiring the Kappmeyers to join hundreds of other
property owners in order to pursue their claims against the Association.

                  B. Inadequate Appellate Remedy

       In addition to showing an abuse of discretion, to be entitled to
mandamus relief the Kappmeyers must show that they lack an adequate
remedy by appeal. Prudential, 148 S.W.3d at 135–36. “[W]hether an
appellate remedy is ‘adequate’ so as to preclude mandamus review
depends heavily on the circumstances presented and is better guided by
general principles than by simple rules.” Id. at 137. An appellate
remedy is not inadequate merely because of the cost or delay of going
through trial and the appellate process. Id. at 136; Walker v. Packer,
827 S.W.2d 833, 842 (Tex. 1992). However, mandamus relief may be
appropriate if the challenged trial court order places tremendous strain
on the requesting party to the point that the party might “succumb[] to
the burden of the litigation,” if the order “radically skew[s] the

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procedural dynamics of the case,” or if failure to grant relief will result
in waste of judicial and public resources. Prudential, 148 S.W.3d at
136–37 (citing cases).
       Relying on Prudential, the Fourteenth Court of Appeals granted
mandamus relief in a case that bears remarkable similarity to the
underlying suit. In re Corcoran, 401 S.W.3d 136 (Tex. App.—Houston
[14th Dist.] 2011, orig. proceeding). That case also involved a dispute
between a property owner and a homeowners association in which the
owner sought mandamus relief from the trial court’s order compelling
joinder of the other owners in subdivisions governed by the association.
Id. at 138. After concluding that the trial court abused its discretion, 10
the court of appeals held that the owner had no adequate remedy by
appeal because (1) the order would “delay the trial and greatly increase
costs” to the point where the owner was “in danger ‘of succumbing to the
burden of litigation,’” and (2) the order had “‘radically skew[ed] the
procedural dynamics of the case.’” Id. at 139–40 (quoting Prudential,
148 S.W.3d at 136); see also Travelers Indem. Co. v. Mayfield, 923
S.W.2d 590, 595 (Tex. 1996) (holding the defendant lacked an adequate
appellate remedy with respect to the trial court’s order requiring it to
pay the plaintiff’s attorney’s fees as the case progressed because it
“radically skew[ed] the procedural dynamics of the case”).
       Here, the trial court’s order requires the Kappmeyers to bear the
expense of joining several hundred parties to their suit at an estimated

        The underlying dispute related to the association’s decision to allow
       10

an owner to circumvent a deed restriction in a specific instance. Corcoran, 401
S.W.3d at 138–39.

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cost of between $60,000 and $110,000. The order puts the Kappmeyers
in danger of succumbing to the burden of litigation, and such orders all
but ensure this kind of litigation will never be pursued. See Prudential,
148 S.W.3d at 136 (noting that mandamus relief was appropriate in
Mayfield because the erroneous ruling was clear, subject to repetition,
and easily correctable). We hold that the Kappmeyers lack an adequate
appellate remedy.

                            III. Conclusion

      The trial court clearly abused its discretion in granting the
Association’s motion to abate and ordering the Kappmeyers to join the
other Key Allegro property owners. Because the Kappmeyers lack an
adequate remedy by appeal, we conditionally grant their petition for
writ of mandamus and order the trial court to vacate its order. Our writ
will issue only if the court does not comply.

                                         Debra H. Lehrmann
                                         Justice

OPINION DELIVERED: May 12, 2023

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