by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
HOMES ASSOCIATIONS; SERVITUDES;ESTOPPEL: Although facially clear protective covenants generally must be enforced as written, homeowners' association may be estopped from enforcing covenants against residents where residents sought approval from architectural committee prior to construction, architectural committee approved project, and residents reasonably relied on approval.
Woodmoor Improvement Association v. Brenner, 919 P.2d 928 (Colo. App. 1996).
Defendants desired to build a home in a residential subdivision, and sought approval for their plans, which included an adjacent television satellite dish, from the subdivision's architectural control committee. The committee approved the plans, including the satellite dish, so long as the dish was obscured from public view by a fence. Defendants relied on the committee's authority and approval and spent approximately $30,000 on the dish, installation, and fence. A committee representative oversaw the entire construction and certified the project for the committee's approval. Two years later, new members of the homeowners' association sought to enforce a restrictive covenant prohibiting outside aerials or antennae.
The Colorado Court of Appeals held that, although covenants that are clear on their face must generally be enforced as written, equity can, under appropriate circumstances, provide a suitable remedy to effect justice. Equitable estoppel can preclude enforcement of a covenant which inures to the benefit of all residents where the defendants reasonably rely on actions or representations of the architectural control committee. Here, Defendants relied to their detriment, and the fact that they consistently maintained that the satellite dish did not violate the covenant did not negate their reliance.
Comment 1: An interesting feature of the Woodmoor case is that prior Colorado authority had held that architectural review committee approval will not validate a clear violation of use restrictions. The precedent case involved a landowner who moved a used house to a site within the subdivision with the permission of the architectural committee. The Woodmoor court first distinguished the precedent case on the grounds that in Woodmoor, unlike in the precendent case, the subject restriction was vague (it had been established before satellite dishes came into use for television reception, and did not refer to such dishes by name). But, in its later discussion of equitable estoppel, the Woodmoor court effectively eliminated the old precedent by pointing out that no estoppel argument was made in the earlier case. This suggests that reliance upon architectural committee approval will give rise to an estoppel even where the committee specifically validates a clear departure from the adopted restrictions.
Comment 2: Another interesting aspect of the case is the association's argument that an association should not be estopped by the architectural committee's ultra vires act. The association maintained that such associations increasingly are being recognized as "effectively public agencies" and that therefore the general rule prohibiting estoppel of a city by its land use officials should be followed. The court in effect "laughed off" this argument.
Associations might want to be more careful about making such arguments. They may get their wish. If associations are treated as, in effect, public agencies, they will be subjected to Constitutional restrictions of due process and to state law regulation of their electoral proceedings and other activities that will increase their budgets manyfold, if for no other reason than the cost of insurance against suits based upon Section 1983 - deprivation of Constitutional rights under "color of law."
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