IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
ROSS WILKINSON and CINDY
WILKINSON; MONTE KARNES and
KIMBERLEY KARNES; DAVID
BETHEL and JEANIE BETHEL;
DARRELL McLEAN; JIM PAULOS
and KATHY PAULOS; JUSTIN
HARGIS and TABATHA HARGIS;
JOE HARGIS and LINDA HARGIS;
DANIEL MacINDOE and
ISIDRA MacINDOE; and DAVID
SPICER and MARTHA SPICER,
Appellants,
v.
CHIWAWA COMMUNITIES
ASSOCIATION, a Washington NonProfit Corporation,
Respondent.
No. 28911-7-III
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) UNPUBLISHED OPINION
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Kulik, C.J. — In 2008, a majority of the homeowners in Chiwawa River Pines
voted to amend the community’s covenants to prohibit rentals for a period of less than six
months. A group of 17 named homeowners (named homeowners) filed this action,
No. 28911-7-III
Wilkinson v. Chiwawa Communities Ass’n
seeking a declaration invalidating the 2008 Amendment. The Chiwawa Communities
Association (CCA) counterclaimed, asking for declaratory and injunctive relief. Both
parties moved for summary judgment. The trial court concluded that the 2008
Amendment was invalid. We agree. The court then rewrote the amendment to prohibit
rentals of less than one month. The named homeowners challenge only the ruling
prohibiting rentals of less than one month. They contend that the court lacked the
authority to make this ruling and that the court’s modification is invalid. We agree that
the trial court cannot rewrite the invalid 2008 Amendment. Therefore, we reverse the
prohibition on rentals of less than one month and grant summary judgment to the named
homeowners.
FACTS
Chiwawa River Pines is a planned community located near Leavenworth,
Washington. The community consists of 367 lots. Each of the named homeowners is the
owner of at least one improved residential lot located within one of the six phases of the
plat of Chiwawa River Pines.
The original developer of the six phases was Pope & Talbot, Inc. As each phase
was developed, Pope & Talbot recorded a separate set of “Protective Restrictions and
Covenants” (covenants). Clerk’s Papers (CP) at 496. In 1988, a majority of the
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Wilkinson v. Chiwawa Communities Ass’n
homeowners approved the consolidation of the six sets of covenants into one set covering
all phases (1988 Covenants).
The 1988 Covenants restricted land use to single family residential use and
prohibited nuisance, offensive use, and industrial and commercial use. The 1988
Covenants also expressly reserved the power of the majority of the property owners to
adopt new restrictions. All owners of land automatically became members of the CCA,
subject to all the obligations and duties set forth in the articles, bylaws, and any
amendments.
The land use provision limited use to single family residential. The provision
read:
Lots shall be utilized solely for single family residential use consisting of
single residential dwelling and such out-buildings (garage, no more than
one guest cottage, patio structure), as consistent with permanent or
recreational residence.
CP at 285 (emphasis added).
Nuisances or offensive uses were prohibited in the provision stating:
No nuisance or offensive use shall be conducted or suffered as to lots
subject hereto, nor shall any lot be utilized for industrial or commercial
use.
CP at 285 (emphasis added).
The 1988 Covenants also contained a sign restriction under the section entitled
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Wilkinson v. Chiwawa Communities Ass’n
“Trash Disposal.” CP at 286. Except for this sign restriction, the 1988 Covenants are
silent as to the rental of residential property. The sign restriction clearly assumes that
rentals were allowed in the community. The sign provision read:
No sign of any kind shall be displayed to the public view on any lot, tract or
subdivision thereof in the plat, except one sign of not more than 3 feet
square giving the names of the occupants of the lot, tract, or approved
subdivision thereof, and one sign of not more than 6 square feet advertising
the property for sale or rent.
CP at 286 (emphasis added).
The 1988 Covenants also contained a provision pertaining to the amendment of the
covenants. This provision read:
These covenants shall run with the land and shall be binding until 1998 (ten
years), at which time said covenants shall be automatically extended for
successive periods of ten years, unless the majority of the then owners of
lots within the plat agree, by majority vote, to change these protective
restrictions and covenants in whole or in part.
CP at 287.
And the 1988 Covenants included a severability clause:
The provisions hereof are severable, and the invalidation of any part or
parts hereof shall not thereby disqualify or invalidate the other provisions
hereof which shall remain in full force and effect in accordance with their
terms.
CP at 286.
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Wilkinson v. Chiwawa Communities Ass’n
The 1991 Covenants. The 1991 Covenants were adopted by a majority of the
owners. The 1991 Covenants altered the 1988 Covenants to delete the words, “no more
than one guest cottage.” Cf. CP at 285, 520. No other changes of consequence were
made at that time.
2008 Amendment. The board of trustees of CCA scheduled a meeting for
September 27, 2008. At this meeting, members voted on whether to allow each of the
following exceptions to the industrial or commercial use covenant: (1) long-term, lowimpact, service-oriented businesses; (2) long-term residential rentals (duration longer that
six months); and (3) short-term rentals (duration shorter than six months). A majority of
the members voted to allow long-term residential rentals for a period of six months or
more. Members also voted against allowing short-term rentals and voted against allowing
long-term, low-impact, service-oriented businesses.
At the September meeting, a majority of the members approved amendments to
paragraphs 4 and 5 of the 1991 Covenants. The 2008 Amendment prohibited short-term
rentals, which were defined as rentals of less than six months. Paragraph 4 of the 1991
Covenants entitled “Land Use” was renumbered and amended in its entirety as follows:
Lots shall be utilized solely for single family residential use consisting of
single residential dwelling and such out-buildings (garage, patio structure),
as consistent with permanent or recreational residence. Lots shall not be
utilized for industrial or commercial EXCEPT for the following:
(1)
Long-term, low-impact service-oriented business: . . . .
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Wilkinson v. Chiwawa Communities Ass’n
(2)
Long-term residential rentals for a period of more than six (6)
consecutive months: All residential rentals for a period of six (6)
consecutive months or more shall be permitted, shall be in writing,
subject to compliance with local zoning and permitting regulations,
and subject to the Protective Covenants and By-laws.
All residential rentals for a period of less than six (6) consecutive
months shall not be permitted.
CP at 524.
Paragraph 5 entitled “Nuisances or Offensive Use” was also renumbered and
amended to read:
No nuisance or offensive use shall be conducted or suffered as to lots
subject hereto, nor shall any lot be utilized for industrial or commercial use
(except as authorized under section 4, “Land Use”[)].
CP at 524.
Rentals. Prior to the 2008 Amendment, increasing numbers of properties in the
community were being used as rentals. Some properties were advertised on websites.
CCA maintains that the named homeowners’ short-term rentals ranged from 15 to 125
times per year and that their income from these rentals ranged from $3,168 to $33,481
and up.
Board Action Against Rentals. In 1987, the board was notified that an owner
intended to rent his cabin on a day-to-day basis. In a letter dated July 6, 1987, this owner
was advised that daily rentals would violate the land use, nuisance, and offensive use
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Wilkinson v. Chiwawa Communities Ass’n
provisions of the covenants. The owner responded that he had no intention of renting his
cabin on a daily basis.
In 1991, Gloria Fisk, then president of the board, asked an owner to remove her
driveway sign advertising lodging because no businesses were allowed in the community
under the protective covenants. The minutes of a special meeting of the board
memorialized the fact that Ms. Fisk informed the board of the problem and that she would
advise the owner that lodging was not allowed in the community.
Action for Declaratory Judgment. The board set January 1, 2009, as the original
date for compliance with the 2008 Amendment on short-term rentals. The board
extended the compliance date to July 1. The named homeowners then filed suit, seeking
a declaratory judgment that the 2008 Amendment to the covenants was invalid. The CCA
counterclaimed for declaratory and injunctive relief. The parties filed cross motions for
summary judgment.
The trial court concluded1 that: “The 2008 Amendment to the Protective
Covenants is invalid and unenforceable for rentals of a period of more than one month.”
CP at 858. The trial court also determined that “[r]entals for a duration of less than one
1
The trial court also entered findings of fact as part of its ruling. Findings of fact
on summary judgment will not be considered by this court. See Chelan County Sheriffs’
Ass’n v. County of Chelan, 109 Wn.2d 282, 294 n.6, 745 P.2d 1 (1987).
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Wilkinson v. Chiwawa Communities Ass’n
month violate the single-family residential use restriction and [the] prohibition
against commercial use, nuisance, and offensive use in the 1988 and 1991 Amended
Protective Covenants.” CP at 858. As part of the order on summary judgment, named
homeowners were ordered to immediately cease and desist from advertising, in print or
on the Internet, and operating short-term rentals for less than one month.
In short, CCA wanted to limit rentals to those six months and over, but the trial
court invalidated this provision and made a ruling prohibiting rentals of less than one
month.
Bond. The trial court denied named homeowners’ motion for reconsideration.
Named homeowners then filed this appeal. Named homeowners also posted a cash bond
of $1,720 in an attempt to stay enforcement of the order. The trial court declared the
bond void and reiterated the cease and desist order. Not all named homeowners complied
with the order and several were found in contempt of court. Named homeowners then
moved this court for a stay of the enforcement of the trial court’s order. The
commissioner granted the motion and, later, the trial court set the bond at $36,920.
Named homeowners posted the bond. CCA moved to modify the commissioner’s ruling.
The commissioner denied the motion. Named homeowners filed a motion asking for the
bond to be reduced to $1,720.
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Wilkinson v. Chiwawa Communities Ass’n
Appeal. Named homeowners agree with the portion of the trial court’s decision
invalidating the 2008 Amendment, which prohibited rentals of less than six months. But
named homeowners challenge the trial court’s decision prohibiting rentals of less than
one month. Although the trial court invalidated the CCA-supported 2008 Amendment,
CCA does not challenge that portion of the court’s decision. While named homeowners
challenge the ruling prohibiting rentals of less than one month, CCA agrees with this
ruling.
ANALYSIS
The issue on appeal is limited to whether the court erred by rewriting the 2008
Amendment to prohibit rentals of less than one month. If named homeowners are
successful, the covenants will contain no restrictions on the length of rentals.
Standard of Review. Summary judgment is proper if the pleadings and supporting
declarations show that there is no genuine issue of material fact and that the moving party
is entitled to judgment as a matter of law. CR 56(c). When reviewing a grant or denial of
summary judgment, the reviewing court engages in the same standard as the trial court
and conducts a de novo review. Davis v. Microsoft Corp., 149 Wn.2d 521, 530-31, 70
P.3d 126 (2003). Facts and reasonable inferences are construed in the light most
favorable to the nonmoving party. Our Lady of Lourdes Hosp. v. Franklin County, 120
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Wilkinson v. Chiwawa Communities Ass’n
Wn.2d 439, 452, 842 P.2d 956 (1993).
2008 Amendment. After the approval of the 2008 Amendment, named
homeowners filed an amended complaint for declaratory judgment against CCA in which
they sought the following relief:
That the Court declare invalid and null and void the Protective Covenant
recorded under Chelan County Auditor’s File Number 2291058 that
prevents the Plaintiffs from renting their tracts for short term rental
purposes.
CP at 49. CCA’s answer and counterclaim sought the opposite relief.
Both parties filed motions for summary judgment. CCA filed a motion for
summary judgment stating:
[CCA] requests this Court enter an Order on Summary Judgment
declaring that the 2008 amendment to the Chiwawa River Pines Protective
Restrictions and Covenants is valid and enforceable against [named
homeowners].
CP at 102.
In contrast, named homeowners’ cross motion for summary judgment sought the
opposite relief:
[Named homeowners] request that this Court enter an Order on
Summary Judgment declaring that the 2008 AMENDMENT TO
PROTECTIVE COVENANTS FOR ALL OF CHIWAWA RIVER PINES
. . . prohibiting short-term rentals of less than six consecutive months is
invalid and unenforceable against the [named homeowners] and their
successors and assigns as owners of the tracts/lots.
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Wilkinson v. Chiwawa Communities Ass’n
CP at 443.
Here, both parties agreed on the material facts. And, as a result, one party was
entitled to judgment as a matter of law. See Citizens for Des Moines v. Petersen, 125
Wn. App. 760, 772, 106 P.3d 290 (2005).
The single issue raised and litigated before the trial court was the validity of the
2008 Amendment. The trial court responded by invalidating the 2008 Amendment. The
trial court then went beyond the requests of the parties and modified the amendment to
prohibit rentals of less than one month. CCA, which previously sought to have the 2008
Amendment enforced, does not appeal the court’s decision to invalidate the 2008
Amendment.
Consequently, the only issue on appeal is whether the court erred by rewriting the
2008 Amendment to prohibit rentals for periods of less than one month. Resolution of
this issue is dispositive of this case.
The 1988 Covenants, and all following covenants, provided for the change of
covenants by a majority vote. Here, the 2008 Amendment was adopted by majority vote
and then challenged by named homeowners.
When construing a restrictive covenant, a court’s primary task is to determine the
drafter’s intent. Wimberly v. Caravello, 136 Wn. App. 327, 336, 149 P.3d 402 (2006).
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Wilkinson v. Chiwawa Communities Ass’n
The goal is to ascertain and give effect to those purposes intended by the covenants,
while placing “‘special emphasis on arriving at an interpretation that protects the
homeowners’ collective interests.’” Riss v. Angel, 131 Wn.2d 612, 623-24, 934 P.2d 669
(1997) (quoting Lakes at Mercer Island Homeowners Ass’n v. Witrak, 61 Wn. App. 177,
181, 810 P.2d 27 (1991)). Basic rules of contract interpretation apply to the review of
covenants. Wimberly, 136 Wn. App. at 336. Courts “are ‘not at liberty, under the guise
of construing the contract, to disregard contract language or revise the contract.’” Seattle
Prof’l Eng’g Employees Ass’n v. Boeing Co., 139 Wn.2d 824, 833, 991 P.2d 1126 (2000)
(quoting Seattle Prof’l Eng’g Employees Ass’n v. Boeing Co., 92 Wn. App. 214, 221, 963
P.2d 204 (1998)).
Here, the court was asked to determine the validity of the 2008 Amendment. The
court answered this question, but then went on to fashion a new covenant. The court
lacked the authority to do so.
Equally important, the purpose of the civil rules is to give notice to the other party
of the relief sought. “CR 7(b)(1) requires that a motion ‘shall state with particularity the
grounds therefor, and shall set forth the relief or order sought.’” Pamelin Indus., Inc. v.
Sheen-U.S.A., Inc., 95 Wn.2d 398, 402, 622 P.2d 1270 (1981). Here, the trial court went
beyond the scope of relief requested and deprived the parties and others of notice that
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such relief would be granted. See id.; Meresse v. Stelma, 100 Wn. App. 857, 866, 999
P.2d 1267 (2000). In Meresse, the court determined that an amendment to a covenant
was invalid because “‘[t]he law will not subject a minority of landowners to unlimited
and unexpected restrictions on the use of their land merely because the covenant
agreement permitted a majority to make changes to existing covenants.’” Meresse, 100
Wn. App. at 866 (quoting Boyles v. Hausmann, 246 Neb. 181, 191, 517 N.W.2d 610
(1994)).
We reverse the trial court’s ruling rewriting the 2008 Covenants to prohibit rentals
of less than one month. Because named homeowners prevail here, the issue of the
amount of the bond is moot.
A majority of the panel has determined this opinion will not be printed in the
Washington Appellate Reports, but it will be filed for public record pursuant to
RCW 2.06.040.
_________________________________
Kulik, C.J.
WE CONCUR:
______________________________
Brown, J.
_________________________________
Korsmo, J.
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