Daily Development for Thursday, January 27, 2000

By: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin
Kansas City, Missouri
randolphp@umkc.edu

ASSOCIATIONS; ARCHITECTURAL REVIEW: Order of architectural control committee is invalid where committee consisted of five members, while CC&R's required three.

Hartstene Point Maintenance Ass'n v. Diehl, 979 P.2d 854 (Wash. App. 1999).

A homeowner (Diehl) requested that the Architectural Control Committee approve his plan to cut down certain trees on his residential property. The Committee approved Diehl's request on condition that he leave standing on his property a 26inch diameter cedar. Diehl cut down the tree anyway, and was fined $1,000 by the Committee. After he refused to pay, the homeowners' association filed suit, seeking damages and an order suspending Diehl from exercising certain rights and privileges as a member of the homeowners' association.

The trial court granted the homeowners' association's request that Diehl be suspended. Diehl appealed on the ground that the Committee's order was void because the Committee was not properly constituted. The Washington Court of Appeals agreed and reversed the trial court's judgment.

The declaration of covenants, conditions and restrictions of the Association provided that the Committee would consist of three members, while there were five members at the time Diehl was ordered not to cut down the trees. The court held that "three" meant "only three," and that the presence of more than three members invalidated the acts of the Committee.

State statute required as well that there be two directors on architectural committees of homes associations, and there was only one on this Committee. This was an independent ground for invalidation of the action. The court rejected the Association's argument based upon Washington's statute preventing challenges to a corporation's power to perform acts. It stated that Diehl challenged only the method through which the Association exercised its power, not the power itself.

Also see: Stuart v. Flemming, 200, 560 N.W.2d 336) (Mich.1997) (the DD for 4/15/97) Failure to form an architectural review committee may bar residential subdivision residents from enforcing restriction requiring that new construction must be "harmonious" with balance of homes developed in subdivision.

Comment 1: The Association was on weak ground when it failed to have more than one director on the Committee. Of course, the Association itself has long since validated the action of the Committee, so some might argue that the invalidation of the Committee's action is somewhat harsh, in light of the fact that all the directors now agree with the Committee's positions. But note that the violation occurred at a time when the decision had not been validated.

Comment 2: In any event, should we view the requirement for committee composition as a protection only for the Association, or is it also a sort of "due process" guarantee for individual unit owners, on the theory that directors are more likely to have a broader perspective and more likely to be in tune with the attitudes of all the members of the Association? If this is the reason for the committee composition requirement, then denial of such a committee to Diehl was like a denial of due process, inconsistent with his contract expectation of fair treatment by the Committee.

Comment 3: But even if we accept the notion that the requirement for two directors was dispositive, what do we do with the fact that the court also would have struck down the Committee's ruling because there were five, rather than three, members of the Committee? In a case like this, wouldn't it be better to require the complainant to demonstrate that he was injured by the change? If all five members voted in support of the Committee's position, Diehl's argument that the Committee would have reached some different decision if only three had been on the Committee is somewhat weak. Of course, there are arguments based upon the psychology of group decision making that a small group might have made a different decision but shouldn't Diehl be required to demonstrate prejudice in such a case?

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