William E. Salie, III v. Jeffrey W. Barnes & a.

THE STATE OF NEW HAMPSHIRE

SUPREME COURT

In Case No. 2019-0523, William E. Salie, III v. Jeffrey W.
Barnes & a., the court on April 27, 2020, issued the following
order:

Having considered the briefs and record submitted on appeal, we
conclude that oral argument is unnecessary in this case. See Sup. Ct. R. 18(1).
We affirm.

The defendants, Jeffrey W. Barnes and nine other lot owners in a certain
subdivision (owners), appeal an order of the Superior Court (Schulman, J.)
granting summary judgment in favor of the plaintiff, William E. Salie, III. They
contend that the trial court erred by: (1) finding that restrictive covenants
burdening the lots within the subdivision do not prohibit the construction of a
detached garage; (2) finding that no approval for the plaintiff’s proposed
detached garage was required because no entity existed with the authority to
give such approval pursuant to the covenants; and (3) not identifying the
plaintiff’s proposed garage as a commercial use.

In reviewing the trial court’s grant of summary judgment, we consider
the affidavits and other evidence, and all inferences properly drawn from them,
in the light most favorable to the non-moving party. Shaff v. Leyland, 154 N.H.
495, 497 (2006). If there is no genuine issue of material fact, and if the moving
party is entitled to judgment as a matter of law, we will uphold the grant of
summary judgment. Id. We review the trial court’s application of the law to
the facts de novo. Id.

The proper interpretation of restrictive covenants is a question of law,
which we review de novo. See Stowell v. Andrews, 171 N.H. 289, 295 (2018).
We base our judgment on this question of law upon the trial court’s findings of
fact. Id. at 296. When interpreting a deed, we give it the meaning intended by
the parties at the time they executed it, taking into account the surrounding
circumstances at that time. Id. If the language of the deed is clear and
unambiguous, we will interpret the intended meaning from the deed itself
without resort to extrinsic evidence. Id. Cases involving restrictive covenants
present such a wide spectrum of differing circumstances that each case must
be decided on its own facts. Chase v. Joslin Mgmt. Corp., 128 N.H. 336, 338
(1986).

We first address whether the trial court erred in concluding that the
restrictive covenants do not preclude detached garages. The owners argue
that, because the covenants require all residences to have an attached garage,
all other garages are necessarily precluded. However, section 14 of the
covenants requires that “[u]nregistered or uninspected automobiles or
automobiles being repaired, refinished or restored . . . shall be stored in a
garage or other enclosed structure.” (Emphasis added.) The plain meaning of
this provision is that “other enclosed structure[s]” are permitted for the
purpose of housing and working on automobiles.

The requirement, in section 4 of the covenants, that each dwelling shall
have an attached garage does not conflict with the provision allowing “other
enclosed structures” housing automobiles. Accordingly, we conclude that no
issue of material fact exists and that, even viewing the facts in the light most
favorable to the defendants, the covenants allow for detached garages.

We next address whether the trial court erred in concluding that the
plaintiff is not required to obtain approval for a detached garage. The
covenants require the grantor’s approval for numerous things, including the
design of a mailbox, the use of vinyl siding, and the construction of any
“outbuildings or appurtenances.” The grantor, “in its sole discretion,” had “the
right to approve the plans and specifications of all residences and other
structures.” The covenants provide that, after the grantor had sold all the lots,
the lot owners “may . . . designate a successor to such approval responsibility.”
(Emphasis added.) The plaintiff represents, and the owners do not contest,
that the grantor sold its last lot in 2004 and, being a limited liability company,
was dissolved in 2008.

The covenants assume that the grantor’s approval rights would pass to a
homeowners’ association; several sections refer to the transfer of approval
authority to a homeowners’ association. For example, section 6 of the
covenants, governing design and plan approvals, provides that “[u]pon
relinquishment of responsibility for approvals to any future Homeowners’
Association, the Grantor shall have no liability.” The defendants acknowledge
that no homeowners’ association or other “independent design review
authority” exists.

The owners contend that the covenants are ambiguous because: (1) a
successor authority may be assigned the grantor’s approval powers by a
majority of the lot owners, but the creation of a homeowners’ association
requires a unanimous vote; (2) they contain both obligatory requirements and
approval requirements; (3) they do not specify what happens if there is both a
successor authority and a homeowners’ association; and (4) they do not specify
what happens if there is neither a successor authority nor a homeowners’
association. We conclude that these points do not raise a genuine dispute of
material fact. See Franciosa v. Hidden Pond Farm, Inc., 171 N.H. 350, 354
(2018) (stating that fact is material if it affects outcome of litigation under
applicable substantive law). The owners argue that they have the right to

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enforce the covenants. See Varney v. Fletcher, 106 N.H. 464, 467 (1965)
(stating that lot owners can enforce reciprocal covenants). However, the lot
owners declined the grantor’s approval rights when they failed to establish a
homeowners’ association or other successor authority. Cf. Nashua Hospital v.
Gage, 85 N.H. 335, 343 (1932) (stating that restrictive covenants may be
abandoned when not enforced).

The owners offer no explanation how the grantor’s approval rights can be
exercised in the absence of a successor authority. The trial court correctly
identified the many obstacles inherent in such an exercise. Even viewing the
record in the light most favorable to the owners, we conclude that the
covenants do not allow for the enforcement of the grantor’s approval rights in
the absence of a successor authority.

Finally, we address whether the trial court erred by not considering the
plaintiff’s proposed garage to be a commercial use. The covenants prohibit
commercial uses, as do the town zoning regulations. The plaintiff stipulated
that he will not use the proposed garage for commercial purposes. The town
issued the plaintiff a building permit, which it could not have done were the
garage to be used for commercial purposes. The owners argue that, given its
size and equipment, the proposed garage “could easily be used for a
commercial enterprise, regardless of the Plaintiff’s subjective intent.” The
covenants prohibit actual commercial uses, however, and not uses that “could
easily” become commercial.

Pike Industries, Inc. v. Woodward, 160 N.H. 259 (2010), is inapposite.
There, the issue was whether the landowner had continued its ongoing
commercial use of the property, for zoning purposes, by maintaining its plant
in readiness to produce commercial materials, not whether the size of and
equipment in its buildings, regardless of their use, constituted a commercial
use. Id. at 263. In the case at hand, the record does not support that the
plaintiff will maintain the proposed garage “in a state of readiness,” id., for
commercial activities. Accordingly, we conclude that the trial court did not err
by finding that the proposed garage is not a commercial use.

Affirmed.

Hicks, Bassett, Hantz Marconi, and Donovan, JJ., concurred.

Timothy A. Gudas,
Clerk

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