Harvey Wilkening and Robert Bolin v. Sun Bay Development Corporation

ARKANSAS COURT OF APPEALS

NOT DESIGNATED FOR PUBLICATION

JOHN E. JENNINGS, JUDGE

DIVISION I

CA 00-950

April 25, 2001

HARVEY WILKENING AND

ROBERT BOLIN APPEAL FROM GARLAND COUNTY

APPELLANTS CHANCERY COURT

VS.

HONORABLE DAVID B. SWITZER

CHANCELLOR

SUN BAY DEVELOPMENT CORPORATION

APPELLEE AFFIRMED

Appellants, Harvey Wilkening and Robert Bolin, appeal from an order upholding the actions taken at a special meeting of co-owners of Sunbay Beach Club. Appellants raise a number of issues on appeal in which they argue that the meeting was conducted in violation of the by-laws of the horizontal property regime. We affirm.

Sunbay Beach Club Council of Co-Owners is an interval ownership horizontal property regime that is organized for thepurpose of managing and maintaining the Sunbay Resort in Garland County. Sunbay Beach Club filed suit on February 9, 2000, seeking an ex parte restraining order and permanent injunction against appellee Sun Bay Development Corporation, the current developer of Sunbay Resort, to prevent appellee from conducting a special meeting of co-owners that was to be held on February 10. The proposed agenda for the meeting was to increase the number of board members from three to seven, to set the terms of office for the newly created positions, and to elect members to fill the new positions. On February 10, the trial court entered an ex parte temporary restraining order that allowed the meeting to be held but enjoined appellee from taking any action other than those items already scheduled for the special meeting. The court set a hearing for February 18.

According to the minutes of the February 10 special meeting, the proposal to increase the number of board administrators from three to seven members passed. The terms of office for the new positions were set, and four persons were elected to fill those offices.

On February 11, appellee filed a counterclaim against Sunbay Beach Club and against the appellants and Waylon Watson, who were the original three board members. Appellee sought to enjoin the them from entering into long-term contractual agreements until afinal hearing could be held and asked for a determination that the special meeting was called and conducted in accordance with the by-laws. On that day, the trial court entered an ex-parte restraining order prohibiting the parties from entering into any contracts for a period in excess of thirty days.

Instead of having a trial, the parties submitted the case to the court for decision based on stipulated facts and affidavits. In an order dated May 2, 2000, the trial court found that the special meeting was called and conducted in accordance with the by-laws, and the court thus confirmed the measures approved at the special meeting. Appellants have brought this appeal from that order.

Although chancery court cases are tried de novo on the record, we will not reverse the findings of the chancellor unless they are clearly against the preponderance of the evidence. Barclay v. Melton, 339 Ark. 362, 5 S.W.3d 457 (1999).

Appellants first contend that the special meeting was not properly called because appellee failed to submit a written request for such a meeting to be called. This argument is based on Article IX, Section 4 of the by-laws which provides:

Special Meetings of the Co-Owners may be called at any time by the President, the Board of Administrators, or by any Co-Owner pursuant to the written request of Co-Owners represent ing not less than 1/8 of the total value ofthe Condominium regime, as such regime may exist or as it may exist in the future after expansion.

The record reflects that the appellee called the meeting pursuant to a written notice which set the date and time for the meeting and outlined the proposed agenda for the meeting. We cannot say that the trial court's finding that the notice satisfied this requirement is clearly erroneous.

Appellants' next issue is also directed at this section of the by-laws. They argue that there is insufficient evidence that appellee represents at least 1/8 of the total value of the regime. However, Jack Plumlee, the president of appellee corporation, stated in his affidavit that appellee represented by ownership or proxy 1,256 units of a total of 5,651 units of ownership in the development. Although appellants contend that there is no evidence to corroborate that assertion, the parties submitted the case to the court based on stipulations and affidavits, and the trial court was entitled to give credence to Mr. Plumlee's affidavit. The burden of proving error on appeal is on the appellant, not the appellee, and it is the appellant's burden to bring up a record sufficient to demonstrate error. Young v. Young, 316 Ark. 456, 872 S.W.2d 856 (1994). We will accept as correct the decisions of the trial court which the appealing party does not show to be wrong. Id. Based on the evidence before it, the trial court's findingthat appellee represented sufficient ownership to call the meeting is not clearly erroneous. See e.g. City of Crossett v. Switzer, 302 Ark. 239, 788 S.W.2d 738 (1990).

Appellants further contend that the notices of the meeting were not sent within ten days of the meeting as required by Article XI, Section 5 of the by-laws. Appellants point out that the notice was undated and rely on the affidavits of owners Robert Gage and James Roberts who stated that they did not receive the notice within ten days of the meeting. In his affidavit, however, Mr. Plumlee stated that the notices were mailed to the owners on January 26, 2000. Although appellants again argue that there is no proof to support Mr. Plumlee's assertion, it was for the chancel lor, as the trier of fact, to resolve conflicts in the testimony in favor of one party. Mitchell v. House, 71 Ark. App. 19, 26 S.W.3d 586 (2000). We cannot say that the chancellor's finding on this issue is clearly erroneous.

Based on other provisions in the by-laws, appellants also argue that any modification of the system of administration must be approved by co-owners representing two-thirds of the value of the regime, or alternatively, that any amendment of the by-laws must be adopted by a majority of fifty-one percent. Appellants further argue that there was no quorum at the special meeting. We are unable to consider these specific arguments because they were notpresented to the trial court. Arguments not raised at trial will not be addressed for the first time on appeal, and parties are bound on appeal by the scope and nature of the objections and arguments they presented below. State v. Donahue, 334 Ark. 429, 978 S.W.2d 748 (1998).

For the reasons stated the decision of the trial court is affirmed.

Bird and Griffen, JJ., agree.