Wanda Roberts v. Anthony W. Henson

FILED
Apr 18 2017, 9:04 am

CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court

ATTORNEY FOR APPELLANTS ATTORNEYS FOR APPELLEE
Larry O. Wilder Richard R. Fox
Jeffersonville, Indiana Steven A. Gustafson
Fox Law Offices, LLC
New Albany, Indiana

IN THE
COURT OF APPEALS OF INDIANA

Wanda Roberts, et al. April 18, 2017
Appellants-Petitioners, Court of Appeals Case No.
10A01-1607-PL-1647
v. Appeal from the Clark Circuit
Court
Anthony Henson, The Honorable Andrew Adams,
Appellee-Respondent, Judge
Trial Court Cause No.
10C01-1303-PL-22

Barnes, Judge.

Case Summary
[1] Wanda and Ray Roberts, along with seventeen of their neighbors (collectively

“the Appellants”), appeal the trial court’s grant of summary judgment in favor

of Anthony Henson and the denial of their motion for summary judgment. We

reverse and remand.

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 Issue
[2] The restated issue before us is whether the trial court correctly concluded as a

matter of law that a structure built by Henson in the Appellants’ neighborhood

did not violate the neighborhood’s restrictive covenants.

Facts
[3] Since 1961, the Roberts have owned a home at 114 Altra Drive in Clarksville,

in the Altra Subdivision neighborhood. Construction in the neighborhood is

governed by restrictive covenants adopted and recorded in 1956. One of the

covenants provides: “No lots shall be used except for residential purposes. No

building shall be erected, altered, placed or permitted to remain on any lot other

than one detached single-family dwelling not to exceed one and one-half story

in height and a private garage for not more than two cars.” Appellants’ App. p.

18. Another provision states: “No structure of a temporary character, trailer,

basement, tent, shack, garage, barn, or other outbuilding shall be used on any

lot at any time as a residence either temporarily or permanently.” Id. at 19.

[4] In November 2012, Henson purchased a lot next door to the Roberts at 112

Altra Drive; the lot was vacant after the previous residence on the lot burned

down. Henson filed a residential building application with the Town of

Clarksville to build a structure on the lot. The application stated that the

structure would have two stories, with 1,760 square feet of living space and

3,200 square feet of garage space. Attached to the application were the

following drawings of the proposed structure:

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[5] Thus, it appears from the drawings that the structure would consist of a two-

story living area connected to a four-bay garage. Engineering reports prepared

for the structure described it as a “barn.” Id. at 56. The Town of Clarksville

granted a permit to Henson to build the proposed structure, but noted,

“Research of the covenants for this neighborhood is highly recommended!” Id.

at 59.

[6] On March 18, 2013, after Henson began construction of his structure, the

Roberts filed a “Petition to Enforce Restrictive Covenants” and a petition for an

emergency restraining order compelling Henson to cease construction. Id. at

14. The trial court did not hold a hearing on the restraining order request.

Seventeen other residents of the neighborhood subsequently intervened in the

suit against Henson as plaintiffs. Henson eventually completed and moved into

his structure while this litigation was pending.

[7] On September 24, 2015, Henson filed a motion for summary judgment.

Accompanying the motion was an affidavit from W. House Canter, a retired

member of the State Home Inspector Board. In the affidavit, Canter stated, that

Henson’s “house is a single family dwelling with 1.5 stories,” and that it had “a

garage fit for two vehicles. This restriction is a use restriction.” Appellee’s

App. p. 5. There is a grainy photograph of Henson’s building attached to

Canter’s affidavit; it is not possible to discern much from the photograph other

than it depicts two levels of windows above ground at the front. The affidavit

also made the following observations about other houses in the neighborhood:

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 7. At 114 Altra Drive, the house has been remodeled to turn
the original garage into living space and a detached garage has
been built into the rear of the property. There is also a storage
building behind the property not contemplated by the covenants.

8. At 116 Altra Drive, the house has an additional 2 car
garage in addition to the original garage attached to the house.

9. 105 Altra Drive also has an additional detached 2 car
garage in addition to the original garage attached to the house.

10. 119 Altra Drive also has an additional detached 2 car
garage in addition to the original garage attached to the house.

11. 206 Altra Drive has been remodeled to turn the original
garage into living space and a detached garage has been built into
the rear of the property.

12. 124 Altra Drive has additional canopied parking for more
than two cars.

[8] Id. at 6. Henson also submitted an affidavit on his own behalf, stating in part:

14. My home is not a barn. My home is my residence. The
use of the term “pole barn” in my application for a building
permit is a “construction” term and not a “use” term. I
incorrectly identified the construction method in my application.
My home is correctly identified as a “post-frame building”.
Regardless, the restrictions do not prohibit either of these
construction methods.

15. My home is a one and a half story home and not a two
story home.

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 Id. at 22.

[9] On April 14, 2016, the Appellants responded to Henson’s motion and filed their

own motion for summary judgment. Submitted with the Appellants’ motion

was an affidavit from professional home and commercial builder Troy Briner.

Briner opined that after viewing Henson’s building in photographs and in

person, “it is my expert opinion that the building constructed on 112 Altra

Drive, Clarksville, Indiana is what it was purported to be when the applications

were secured from the town of Clarksville” and “that the building constructed is

a 40 foot by 100 foot Pole Barn as described in all of the legal documents filed

with the town.” App. p. 108.

[10] On June 23, 2016, the trial court denied the Appellants’ motion for summary

judgment and granted Henson’s motion. The Appellants now appeal.

Analysis
[11] When reviewing a grant of summary judgment, we must draw all reasonable

inferences in favor of the non-moving party and affirm only “‘if the designated

evidentiary matter shows that there is no genuine issue as to any material fact

and that the moving party is entitled to judgment as a matter of law.’” Siner v.

Kindred Hosp. Ltd. P’ship, 51 N.E.3d 1184, 1187 (Ind. 2016) (quoting Ind. Trial

Rule 56(C)). Careful scrutiny must be given to a grant of summary judgment to

ensure that the losing party was not improperly denied its day in court. Id.

“Indiana’s distinctive summary judgment standard imposes a heavy factual

burden on the movant to demonstrate the absence of any genuine issue of

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 material fact on at least one element of the claim.” Id. In determining whether

summary judgment was properly granted, we consider only the evidentiary

matter the parties specifically designated to the trial court. Sargent v. State, 27

N.E.3d 729, 731 (Ind. 2015). “The fact that the parties have filed cross-motions

for summary judgment does not alter our standard for review, as we consider

each motion separately to determine whether the moving party is entitled to

judgment as a matter of law.” Reed v. Reid, 980 N.E.2d 277, 285 (Ind. 2012).

[12] “A restrictive covenant is an express contract between grantor and grantee that

restrains the grantee’s use of land.” Harness v. Parkar, 965 N.E.2d 756, 760

(Ind. Ct. App. 2012). Such covenants maintain or enhance the value of land by

restraining or regulating groups of properties. Id. at 760-61. Covenants control

many aspects of land use, including what may be built on the land, how the

land may be used, and alienability of the land. Id. at 761. “Property owners

who purchase their properties subject to such restrictions give up a certain

degree of individual freedom in exchange for the protections from living in a

community of reciprocal undertakings.” Villas W. II of Willowridge Homeowners

Ass'n, Inc. v. McGlothin, 885 N.E.2d 1274, 1279 (Ind. 2008). Such covenants

“‘are clothed with a very strong presumption of validity which arises from the

fact that each individual unit owner purchases his unit knowing of and

accepting the restrictions to be imposed.’” Id. (quoting Hidden Harbour Estates,

Inc. v. Basso, 393 So.2d 637, 639 (Fla. Dist. Ct. App. 1981)).

[13] “Covenants are a form of express contract, and we apply the same rules of

construction when a dispute arises as to the covenants’ terms.” Harness, 965

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 N.E.2d at 761. When we must interpret restrictive covenants, they should be

strictly construed, with any doubts resolved in favor of the free use of property

and against restrictions. Id. The covenanting parties’ intent should be

determined from the language of the covenants and the situation of the parties

when the covenant was made. Id. In addition, the covenants must be read in

their entirety, and differing provisions should be harmonized so as not to render

any terms ineffective or meaningless. Id. Unambiguous language in a

restrictive covenant must be given its plain, usual, and ordinary meaning.

Johnson v. Dawson, 856 N.E.2d 769, 773 (Ind. Ct. App. 2006). Although

construction of written contracts, including restrictive covenants, ordinarily is a

question of law for which summary judgment is particularly appropriate,

“where the intent of the parties cannot be determined within the four corners of

the document, a factual determination is necessary to give effect to the parties’

reasonable expectations.” Campbell v. Spade, 617 N.E.2d 580, 584 (Ind. Ct.

App. 1993). “When summary judgment is granted based on the construction of

a written contract, the trial court has either determined as a matter of law that

the contract is not ambiguous or uncertain, or that any contract ambiguity can

be resolved without the aid of a factual determination.” Rusnak v. Brent Wagner

Architects, 55 N.E.3d 834, 840-41 (Ind. Ct. App. 2016), trans. denied.

A. “Pole Barn”

[14] The first question raised by the parties is whether Henson’s structure was a

“barn” or “pole barn” that was barred by the restrictive covenant prohibiting

any “structure of a temporary character, trailer, basement, tent, shack, garage,

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 barn, or other outbuilding [from being] used on any lot at any time as a

residence either temporarily or permanently.” Appellants’ App. at 19

(emphasis added). The Appellants contend that Henson’s own engineer called

the structure a “barn” or “pole barn” in direct contravention of the covenants.

Henson asserts that language merely described the construction method of the

building, which otherwise is a normal residence and does not resemble the

traditional concept of an agricultural “barn.”

[15] With respect to the covenant’s prohibition against using a “barn” as a

residence, we believe it is ambiguous with respect to whether it would apply to

a structure such as Henson’s. On the one hand, the engineering documents do

clearly refer to the structure as a “barn”; on the other, it does not resemble a

“barn” in the colloquial sense. With respect to this ambiguity, however, we

conclude it can be resolved without resort to extrinsic evidence.

[16] In attempting to interpret an ambiguous contractual provision, we may consult

sources reflecting the ordinary meaning of its terms at the time the contract was

executed. See Reuille v. E.E. Brandenberger Constr., Inc., 888 N.E.2d 770, 771

(Ind. 2008). We do not have ready access to a dictionary from 1956, when

these covenants were written. Regardless, we doubt the common

understanding of that word is one that has changed significantly over time. A

standard dictionary definition of “barn” is: “1. A farm building used to store

farm products and shelter livestock. 2. A large shed for the housing of vehicles.

3. A particularly large, typically bare building.” AMERICAN HERITAGE

COLLEGE DICTIONARY 111 (3rd ed. 2000). Clearly, Henson’s structure is not a

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 “farm building.” There is the possibility that it could qualify as a “large shed

for the housing of vehicles,” given that the plans indicate the garage area of the

building was to take up approximately three-quarters of the space, or a

“particularly large” or “bare” building.

[17] However, the covenant at issue states that it prohibits using a “barn, or other

outbuilding” as a residence. An “outbuilding” is defined as, “A building

separate from but associated with a main building.” Id. at 969. Read as a

whole and in favor of the free use of land, the covenant bars the residential use

of a second building on a lot in addition to the main residence. It does not

require a main residence to be of any particular method of construction or

architectural style. Here, the challenged structure is not an “outbuilding” but is

the main structure and only residence on the lot. We conclude, as a matter of

law, the structure does not violate the restrictive covenant against barns or other

outbuildings being used as a residence.

B. “One-and-one-half Stories”

[18] Next, we address the assertion that Henson’s structure violates the restrictive

covenant prohibiting any building from exceeding “one and one-half story in

height . . . .” Appellants’ App. p. 18. The Appellants note that the building

permit application expressly stated that the structure would be two stories tall,

and Briner stated in his affidavit that the structure was built as described in the

permit materials. Henson contends that the covenant’s limitation of structures

to “one and one-half story in height” is ambiguous and notes, in any event, that

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 both he and Canter described the building as being only one-and-one-half

stories tall.

[19] Henson’s claim of ambiguity is based largely on several cases he cites from

other jurisdictions, which he asserts establish that a residential covenant height

restriction of “one-and-one-half stories” is “ambiguous as a matter of law.”

Appellee’s Br. p. 11. However, that is not quite a universal view of that

particular covenant language; nor does it mean that covenant disappears and

that Henson’s structure could be any height he desired it to be.

[20] One of the cases relied on by Henson is Hiner v. Hoffman, 977 P.2d 878 (Haw.

1999). In that case, the Hawaii Supreme Court addressed a 1966 restrictive

covenant prohibiting any dwelling of more than “two stories in height” and a

house that was listed on permit applications as a three-story structure and

constructed according to those specifications. The undisputed purpose of the

covenant language was to limit the height of residences in the neighborhood to

protect the view planes of other residents. By a 3-2 vote, the Hiner court held

that, “[w]here, as here, the covenant utterly fails to provide any dimensions for

the term ‘story,’ there is simply no way to know whether the Hoffmans’ three-

story structure exceeded ‘two stories in height.’” Hiner, 977 P.2d at 881

(emphasis in original). The majority thus held that this covenant language was

ambiguous and could not be enforced against the owners of the three-story

structure. Id. at 882.

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[21] By contrast, the dissent in Hiner stated, “The phrase ‘stories in height’ is an

ordinary, stock expression.’” Hiner, 977 P.2d at 886 (Nakayama & Ramil, JJ.,

dissenting). The dissent did not find “two stories in height” to be ambiguous,

and that even if it was, it was clear that the three-story house violated the plain

purpose and intent of the covenant. Id. at 888.

[22] Cases from other jurisdictions take a variety of approaches to whether

restrictive covenants limiting buildings to a certain number of stories are

ambiguous, and if they are whether they are still enforceable. Some, like the

majority in Hiner, view such restrictions as inherently ambiguous and

unenforceable. See Johnson v. Linton, 491 S.W.2d 189, 196–97 (Tex. Civ. App.

1973) (holding covenant restricting limiting homes to “one and one-half (1-1/2)

story in height” was ambiguous and unenforceable where there was conflicting

testimony from several experts as to what the covenant meant); Ludwig v.

Chautauqua Shores Improvement Ass’n, Inc., 5 A.D.3d 1119, 1119, 774 N.Y.S.2d

240, 241 (N.Y. App. Div. 2004) (holding similar covenant ambiguous and

unenforceable where proponents of covenant failed to present “clear and

convincing proof with respect to what number of feet constitutes a ‘story in

height’”).

[23] By contrast, other courts either hold that such provisions are not ambiguous, or

even if so, they may be enforced where there is extrinsic evidence presented

regarding the meaning of the covenant and whether a particular structure

violates it. See Foster v. Nehls, 551 P.2d 768, 770–71 (Wash. Ct. App. 1976)

(holding covenant height restriction of one and one-half stories to be

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 ambiguous, but that homeowner violated it based on extrinsic evidence that

intent of covenant was to prohibit any structure that substantially obstructed

view enjoyed by other neighborhood residents and that home violated that

intent); King v. Kugler, 17 Cal. Rptr. 504, 507 (Cal. Ct. App. 1961) (holding

covenant barring homes more than “one story in height” was unambiguous and

clearly violated by structure that had a garage and ceiling with a room with a

floor and ceiling above the garage); Dickstein v. Williams, 571 P.2d 1169, 1171

(Nev. 1977) (holding structure violated covenant against buildings exceeding

“one story from ground level,” which was found to unambiguous, and there

was conflicting evidence about whether structure violated the covenant); Pool v.

Denbeck, 241 N.W.2d 503, 506 (Neb. 1976) (holding covenant limiting

structures to two stories was unambiguous and clearly violated by two-and-one-

half story residence).

[24] We concede that particularly with a description such as “one-and-one-half

stories,” it could be deemed ambiguous with respect to whether a particular

structure exceeds that height. It is less clear than a limitation of one or two

stories. We agree, however, with those courts that do not automatically negate

a covenant such as this simply because it could be deemed ambiguous; rather, it

makes interpretation of the covenant and whether a structure violates it a

question of fact. There is a lack of evidence in the record currently as to the

intent behind this ambiguous covenant provision. Henson, as successful

summary judgment movant, was required to designate some evidence as to

intent and that his structure did not violate that intent. He did not do so. What

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 evidence there is in the record is conflicting. Henson and his expert, Canter,

both described the building as being one-and-one-half stories, in compliance

with the covenant, while the building permit application describes it as a two-

story structure and the Appellants’ expert, Briner, stated that the building was

constructed in accordance with the plans, meaning it was in fact two stories.

The evidence on the meaning of the covenant and whether Henson violated is

either missing or conflicting.

[25] We are aware of the principle that ambiguities in a restrictive covenant should

be construed in favor of the free use of land. This may mean reasonable

interpretations of a covenant should be made in favor of such use, but we do

not believe it means the covenant is entirely negated or that it could never be

violated. After all, one person’s “free use” of property may negatively impact

another person’s “free use” of property if it is in violation of covenants drafted

to enhance the value, use, and enjoyment of property by all residents of the

neighborhood. The other residents are entitled to fair enforcement of covenants

when possible. Summary judgment was premature on the question of whether

Henson violated this covenant. We reverse the grant of summary judgment and

remand for further proceedings to resolve factual issues on this point.

C. “Two-Car Garage”

[26] The final issue is whether Henson’s structure violated the covenant stating that

a residence can only have “a private garage for not more than two cars.”

Appellants’ App. p. 18. This court previously has held that a covenant

providing that a residence could only have “a private garage for not more than
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 three cars” was unambiguous and limited total garage space on a lot to space

for three cars, regardless of the number of structures it might allow. Johnson v.

Dawson, 856 N.E.2d 769, 773-74 (Ind. Ct. App. 2006). The defendant’s plan in

that case to build a detached two-car garage in addition to an attached two-car

garage clearly violated the covenant. Id. at 774. Here, although Canter stated

in his affidavit that Henson’s structure had “a garage fit for two vehicles,” he

described this as “a use restriction.” Appellee’s App. p. 5 (emphasis added). It

is unclear what Canter meant by saying the structure was “fit” for two vehicles

and that it was a “use restriction.” It is clear and unambiguous that the

covenant prohibits garage space for more than two cars, regardless of how the

space is used. The plans for the building clearly seem to show a four-bay

attached garage and again, Briner stated that the building was built according to

plan. On appeal, Henson makes no attempt to argue that he did not in fact

construct a four-car garage on his lot. Rather, he relies solely upon the doctrine

of acquiescence to excuse his noncompliance with the covenant regarding

garages. He directs us to his designated evidence purporting to show that

multiple other residents in the neighborhood violated the two-car garage limit

without repercussions.

[27] “A party opposing equitable enforcement of a restrictive covenant may plead as

a defense the opponent’s acquiescence to similar violations.” Hrisomalos v.

Smith, 600 N.E.2d 1363, 1367–68 (Ind. Ct. App. 1992). When analyzing a

defense of acquiescence, the focus is the effect of the alleged prior violations

upon the ability of the proponent of the restriction to enjoy the benefits of the

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 covenant, compared to the potential abridgement of the proponent’s enjoyment

of the covenant’s benefit caused by the violation sought to be enjoined. Id. at

1368. Three factors are particularly significant to this analysis:

1) the location of the objecting landowners relative to both the
property upon which the nonconforming use is sought to be
enjoined and the property upon which a nonconforming use has
been allowed, 2) the similarity of the prior nonconforming use to
the nonconforming use sought to be enjoined, and 3) the
frequency of prior nonconforming uses.

Id. Whether the principle of acquiescence may be invoked “depends on the

factual circumstances.” Ellis v. George Ryan Co., Inc., 424 N.E.2d 125, 127 (Ind.

Ct. App. 1981). In other words, whether this defense applies “is a question of

fact.” Sandy Point Improvement Co. v. Huber, 613 P.2d 160, 162 (Wash. Ct. App.

1980).

[28] It appears to us that in determining whether to allow Henson to invoke the

defense of acquiescence, a fact-finder must consider all of the evidence and

apply it to the three-factor test listed in Hrisomalos. As with the height

restriction, we believe it is premature to conclude as a matter of law that the

Appellants necessarily acquiesced in Henson’s construction of a four-car

garage. A fact-finder must carefully consider evidence and argument as to the

location of Henson’s structure compared to the Appellants’ lots and other

alleged nonconforming uses, the similarity of the other alleged nonconforming

uses, and their frequency. It does not strike this that this is a mathematical test

that can be decided on summary judgment. For example, regarding similarity,

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 a fact-finder may find that a resident who has converted a previously-attached

garage into living space and built a separate two-car garage has not substantially

violated the covenant in the same way that building a four-car garage would, or

the fact-finder may conclude the opposite. Suffice it to say, further evidentiary

proceedings are necessary to resolve the applicability of this defense. We

reverse summary judgment as to this issue and remand for further proceedings.

Conclusion
[29] We reverse the grant of summary judgment in Henson’s favor with respect to

the covenant provisions regarding story height and two-car garages and remand

for further proceedings with respect to those provisions. However, we agree

that, as a matter of law, Henson’s structure is not a “barn” or “pole barn” that

is prohibited by the covenants.

[30] Reversed and remanded.

Kirsch, J., and Robb, J., concur.

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