K. Hovnanian Homes of Maryland, LLC v. Havre de GraceAnnotate this Case
The Court of Appeals affirmed the judgment of the court of special appeals holding that a developer, K. Hovnanian Homes of Maryland, LLC (Hovnanian) could not enforce an agreement against the Mayor and City Council of Havre de Grace because the Mayor or his subordinate did not execute the agreement, holding that the agreement was ultra vires and unenforceable.
The agreement in this case provided that the City would impose and collect a recoupment fee in connection with the development of residential dwelling units on those properties. The City Council approved the agreement, but the Mayor refused to sign the agreement, and the City did not collect any recoupment fees. The circuit court declared that the agreement was a binding and enforceable contract. The court of special appeals reversed. The Court of Appeals affirmed, holding (1) the imposition of a fee by the City must be undertaken by the municipal legislative body known as the "Mayor and City Council of Havre de Grace" and pursuant to a duly enacted ordinance; and (2) because no such ordinance was enacted, the agreement was ultra vires and unenforceable against the City.