Lake Milton Estate Property Owner Assn., Inc. v. Hufford

2018 Ohio 4784

• Court: Ohio Court of Appeals
• Decided: November 30, 2018
• Docket: 17 MA 0163
• Status: Published

Opinion

[Cite as Lake Milton Estate Property Owner Assn., Inc. v. Hufford, 2018-Ohio-4784.]

IN THE COURT OF APPEALS OF OHIO SEVENTH APPELLATE DISTRICT MAHONING COUNTY

LAKE MILTON ESTATE PROPERTY OWNERS ASSOCIATION, INC., et al.,

Plaintiffs-Appellants,

v.

WILLIAM HUFFORD, et al.,

Defendants-Appellees.

OPINION AND JUDGMENT ENTRY Case No. 17 MA 0163

Civil Appeal from the Court of Common Pleas of Mahoning County, Ohio Case No. 2017 CV 351

BEFORE: Cheryl L. Waite, Carol Ann Robb, Kathleen Bartlett, Judges.

JUDGMENT: Affirmed.

Atty. John A. McNally, III, John A. McNally, III, Co., LPA, 100 E. Federal St., Suite 600, Youngstown, Ohio 44503, for Plaintiffs-Appellants

Atty. David A. Shepherd, and Atty. Stephen A. Turner, Turner, May & Shepherd, 185 High Street, N.E., Warren, Ohio 4481-1219, for Defendants-Appellees.

Dated: November 30, 2018

WAITE, J. –2–

{¶1} Appellants, Lake Milton Estate Property Owners Association, Inc. and six

individuals identified as landowners of the Association (“the Association”), appeal a

November 6, 2017 Mahoning County Common Pleas Court’s decision to grant

Appellees, William Hufford and William A. Hufford, summary judgment. The issue on

appeal is whether the trial court erred in concluding that no evidence was presented to

support Appellants’ claim that Appellees were members of the Association and subject

to its rules. We conclude the trial court correctly held that there was no evidence

presented to establish that Appellees’ parcel was included within the Association and

summary judgment was proper. The judgment of the trial court is affirmed.

Factual and Procedural History

{¶2} Appellees are the owners of an unimproved parcel of real estate located

on Salem Drive in Lake Milton, Ohio. Appellees purchased the property in 2006. The

parcel is also identified as Lot 819 of the BPOE Country Club Allotment (“Lot 819”). The

BPOE Country Club Allotment (“Allotment”) was platted on or around 1924 by BPOE

Country Club Company. (Appellees’ Motion for Summary Judgment, Exh. “B”, pp. 4-5.)

{¶3} In September of 1952 and again in January of 1953, I.J. Denmark, an

owner of various parcels in the Allotment, including Lot 819, recorded two “Declarations

as to Restrictions”. Both are nearly identical and include restrictions concerning

setbacks, square footage of buildings and water/sewer lines. The 1952 Declarations as

to Restrictions reads, in pertinent part:

1. That on all lots in the B.P.O.E. Country Club Allotment shall contain not

less than 720 square feet, except the garages. Garages may be built with

Case No. 17 MA 0163 –3–

no restrictions as to size. A garage apartment may be erected on the rear

one-third of any one lot but only after the main house has been completed.

2. Building setbacks shall be ten per cent (10%) of frontage per lot from

rear property line and each side property line. Setback from front property

line shall be not less than twenty five (25) feet. That no building shall be

built on any lot or tract containing less than forty (40) feet frontage.

3. That sewage from any building erected on the premises shall be cared

for by the owners or occupants installing a septic tank which shall at all

times be maintained in a proper sanitary condition, and that no privy vaults

or cesspools shall be maintained on said premises.

4. That an assessment of one hundred fifty dollars ($150.00) shall be

payable to said sellers and shall run against said lot and shall be a lien

thereon in the event that said sellers construct a water main in the street

running by said lot and provide a water supply available to the same, said

assessment to be paid at the time said water supply system is completed

and made available to said lot. No house trailers or temporary living

quarters shall be allowed on any lot.

{¶4} The main distinction in the 1953 Declaration, filed just three months later,

is that the restriction on trailers or temporary living quarters found in paragraph four was

separated out as a fifth declaration, and a sixth declaration delineating one lot for a club

house was added. Neither the original plat filed in 1924, nor the two subsequent 1952

or 1953 recordings mention or reference a homeowners association or planned

community. (Appellees’ Motion for Summary Judgment, Exh. “B”, pp. 4-5.) Further, the

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chain of title for Lot 819 is completely devoid of any reference to a homeowners

association, planned community or any associated fees. (Appellees’ Motion for

Summary Judgment, Exh. “B”, pp. 3, 18-25.)

{¶5} On February 10, 2017, Appellants filed a complaint with the trial court

alleging that Appellees were members of the Association; were in violation of the rules

and regulations of the Association by placing a porta-potty, shed, trailer and outhouse

on the property; and had failed to pay dues to the Association. Appellants sought

injunctive and other equitable relief.

{¶6} On August 1, 2017, Appellees filed a motion for summary judgment,

contending: (1) the Association was not properly registered as a legal entity with the

Ohio Secretary of State and cannot, without undertaking the required legal registration,

simply acquire the rights of the BPOE Country Club Allotment; (2) notwithstanding its

lack of legal formation, the Association never filed its code of regulations and bylaws

with the Mahoning County Recorder and, hence, these do not appear in the record of

title of Lot 819; and (3) no other declarations or bylaws appear in the record title for Lot

819 after the 1952 and 1953 filings.

{¶7} Appellants filed a brief in opposition on August 17, 2017 and subsequently

filed additional affidavits and documents on August 18 and 29, 2017. Appellants

claimed that Appellees’ counsel admitted at a status conference that Appellees would

be subject to rules and regulations of the Association if it could be proven that their

parcel fell within the Association’s allotment. Appellants argued that the evidence

showed the lot was included in the Association’s allotment, hence, Appellees were

Case No. 17 MA 0163 –5–

bound by their counsel’s statement. A hearing regarding summary judgment was held

on November 3, 2017.

{¶8} On November 6, 2017 the trial court issued a judgment entry concluding:

(1) the Association’s declaration of restriction and bylaws were not filed with the

Mahoning County Recorder and neither appear in the record title for Lot 819; (2) no

other declaration or bylaws appear in the record title for Lot 819; (3) nothing in the title

history of Lot 819 indicates that the owner of the parcel becomes a member of any

owners’ association or requires the owner to pay dues to any association; (4) as no

genuine issue of material fact exists, summary judgment is proper. (11/6/17 J.E., p. 2.)

Appellants filed this timely appeal.

ASSIGNMENT OF ERROR

THE TRIAL COURT ERRED BY GRANTING SUMMARY JUDGMENT IN

FAVOR OF THE DEFENDANT-APPELLEE, WILLIAM HUFFORD, ET AL.

{¶9} This appeal is from a trial court judgment resolving a motion for summary

judgment. An appellate court conducts a de novo review of a trial court’s decision to

grant summary judgment, using the same standards as the trial court set forth in Civ.R.

56(C). Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241 (1996).

Before summary judgment can be granted, the trial court must determine that: (1) no

genuine issue as to any material fact remains to be litigated, (2) the moving party is

entitled to judgment as a matter of law, (3) it appears from the evidence that reasonable

minds can come to but one conclusion, and viewing the evidence most favorably in

favor of the party against whom the motion for summary judgment is made, the

conclusion is adverse to that party. Temple v. Wean United, Inc., 50 Ohio St.2d 317,

Case No. 17 MA 0163 –6–

327, 364 N.E.2d 267 (1977). Whether a fact is “material” depends on the substantive

law of the claim being litigated. Hoyt, Inc. v. Gordon & Assoc., Inc., 104 Ohio App.3d

598, 603, 662 N.E.2d 1088 (8th Dist.1995).

{¶10} “[T]he moving party bears the initial responsibility of informing the trial

court of the basis for the motion, and identifying those portions of the record which

demonstrate the absence of a genuine issue of fact on a material element of the

nonmoving party’s claim.” (Emphasis deleted.) Dresher v. Burt, 75 Ohio St.3d 280,

296, 662 N.E.2d 264 (1996). If the moving party carries its burden, the nonmoving party

has a reciprocal burden of setting forth specific facts showing that there is a genuine

issue for trial. Id. at 293. In other words, when presented with a properly supported

motion for summary judgment, the nonmoving party must produce some evidence to

suggest that a reasonable factfinder could rule in that party’s favor. Brewer v.

Cleveland Bd. of Edn., 122 Ohio App.3d 378, 386, 701 N.E.2d 1023 (8th Dist.1997).

{¶11} The evidentiary materials to support a motion for summary judgment are

listed in Civ.R. 56(C) and include the pleadings, depositions, answers to interrogatories,

written admissions, affidavits, transcripts of evidence, and written stipulations of fact that

have been filed in the case. In resolving the motion, the court views the evidence in a

light most favorable to the nonmoving party. Temple, 50 Ohio St.2d at 327.

{¶12} Appellants contend genuine issues as to material fact exist precluding

summary judgment. Specifically, they argue it was undisputed that Lake Milton Estates,

Inc. is a homeowner’s association. Moreover, Appellants contend that the affidavit of

the president of the Association, William Leone, and the deed restrictions filed in 1952

show that there are recorded restrictions on the parcels contained in the Allotment.

Case No. 17 MA 0163 –7–

Appellants urge that those recorded restrictions apply to Appellees’ lot since it was

purchased after 1952. Appellants also allege that, pursuant to an affidavit filed by

Penny Stratos, assistant secretary of the Association, other deeds (as attached to her

affidavit) did properly contain a reference to Volume 21 of Plats, pp. 42-43 of the

Mahoning County records. Finally, Appellants contend Appellees had actual notice that

they were members of the Association based on two signs posted in the Allotment. The

signs read “Lake Milton Estates, Inc. Members Only No Trespassing” and “Private Lake

Milton Estates Inc. Property Owners and Authorized Vehicles Only.”

{¶13} Appellees maintain that nowhere in the record title of Lot 819 is there any

reference to either a homeowners’ association or to restrictions placed on the subject

parcel. Moreover, the deeds for other properties attached to the Stratos affidavit are

irrelevant, as they have no connection to Lot 819 or demonstrate that Lot 819 is subject

to any restrictions or homeowners’ association regulations. Appellees also contend that

Appellants do not exist as a valid legal entity because they have never filed the required

registration documents with the Ohio Secretary of State and have never properly

recorded any bylaws with the Mahoning County Recorder. Moreover, the two signs

relied on by Appellants as evidence Appellees were on notice their property was

included in an association fail to create valid ownership in the Association and cannot

be used to circumvent the recording requirements of the Association.

{¶14} The Ohio General Assembly introduced Senate Bill 187 to establish

requirements governing the formation and operation of a homeowners association, or

what was termed “planned communities.” SB 187 became Chapter 5312 of the Ohio

Case No. 17 MA 0163 –8–

Revised Code when enacted. Known also as the “Ohio Planned Community Law,” it

became effective on September 10, 2010. R.C. 5312.01.

{¶15} R.C. 5312.15 provides a uniform framework for the establishment and

operation of a planned community. A “planned community” is defined under the statute:

(M) “Planned community” means a community comprised of individual

lots for which a deed, common plan, or declaration requires any of the

following:

(1) That owners become members of an owners association that governs

the community;

(2) That owners or the owners association holds or leases property or

facilities for the benefit of the owners;

(3) That owners support by membership or fees, property or facilities for

all owners to use.

R.C. 5312.01(M).

{¶16} R.C. 5312.01(G) defines a “declaration” as “an instrument a property

owner executes and records to declare that the property is a planned community

subject to the provisions of this chapter.”

{¶17} For planned communities that existed before the September 10, 2010

effective date, R.C. 5312.15 provides:

This chapter shall be construed to establish a uniform framework for the

operation and management of planned communities in this state and to

supplement any planned community governing document that is in

existence on the effective date of this chapter. In the event of a specific

Case No. 17 MA 0163 –9–

conflict between this chapter and express requirements or restrictions in

such a governing document, the governing document shall control. This

chapter shall control if any governing document is silent with respect to

any provision of this chapter.

{¶18} Existing homeowner associations were required to record their bylaws

with the county recorder within 180 days after the statute’s effective date of September

10, 2010, and within 90 days after the adoption of the bylaws by the association if they

were adopted after the effective date. Any amendments to existing bylaws must be

recorded within 60 days after the effective date. R.C. 5312.02(D)(1); R.C.

5312.02(D)(2).

{¶19} In considering the applicability of the Ohio Planned Community Law to Lot

819, Appellants had the burden to demonstrate that Lot 819 was part of a homeowners

association. Evidence to demonstrate that a proper declaration was recorded which

establishes that Lot 819 was part of a “planned community” and that Appellees as

owners of the subject parcel are members of the homeowners’ association was

required. R.C. 5312.01(G); R.C. 5312.01(M). Appellants have failed to establish any of

the above.

{¶20} It is undisputed by Appellants that the record chain of title for Lot 819 fails

to even mention, let alone properly set forth, membership in any owners association or

the requirement for the parcel owner to pay any dues to any association. The 1952 and

1953 “Declaration as to Restrictions” do reflect that restrictions on the BPOE Allotment

were filed regarding setback, structure square footage and restrictions on temporary

structures. However, neither the 1952 nor 1953 restrictions contain any indication that a

Case No. 17 MA 0163 – 10 –

homeowners association or planned community was in place or was intended to be put

in place, and the record of title for Lot 819 gives no other indication that there are any

other restrictions, bylaws or requirements imposed on the property. There is also no

reference in the filings from the 1950’s to any entity other than the “BPOE Allotment.”

Further, while Appellants’ purported bylaws for their Association were included in their

answers to interrogatories, there is no evidence that those bylaws were properly

recorded with the recorder pursuant to the above statutory mandates, nor does this

document appear anywhere in the record title for Lot 819. Moreover, the legal

description for Lot 819 indicates that it is part of the “BPOE Country Club Allotment.” A

copy of a title exam incorporated into Appellees’ motion for summary judgment provides

no evidence that the BPOE Country Club Allotment is synonymous with, or had its

interest transferred to, the Appellants’ Association. (Appellees’ Motion for Summary

Judgment, Exh. A.)

{¶21} Finally, Appellants’ contention that two signs posted at the entrance to the

area serve to put Appellees on notice that they are subject to some homeowners

association is completely contrary to the uniform Ohio Planned Community Act. If this

signage was permitted to serve as notice of membership in a homeowners association

in the complete and total absence of any reference to an association in the record title

of the property, the Act would be rendered a nullity.

{¶22} Constructive notice is required to enforce any restrictive covenants on real

property. The Ohio Planned Community Act recognizes restrictive covenants and

requires that a planned community establish an association not later than 1) the date on

which the first lot is conveyed to a bona fide purchaser or, 2) in accordance with the

Case No. 17 MA 0163 – 11 –

recording requirements for existing associations as set forth above. R.C. 5312.03(B);

R.C. 5312.02(D)(1); and R.C. 5312.02(D)(2).

{¶23} It is axiomatic that restrictive covenants run with the land and bind

subsequent purchasers of real property as long as the subsequent purchaser had notice

of the covenant. Emrick v. Multicon Builders, Inc., 57 Ohio St.3d 107, 109, 556 N.E.2d

1189 (1991). Appellants have not demonstrated that Lot 819 of the Allotment was

intended to be bound by any properly recorded declaration of this Association. The

chain of title for Lot 819 is devoid of any mention of a homeowners association.

Appellants have not provided any rebuttal evidence showing that Lot 819 is subject to

any restrictions of the Association.

{¶24} Even if the restrictions contained within the 1952 and 1953 declarations

are sufficient to constitute constructive notice to Appellees that a planned community

was intended to be formed, and that community contained Appellees’ parcel, no further

steps towards forming an appropriate association or bylaws were undertaken, There is

no other filing of bylaws or indication in the record title for Lot 819 that an association

exists. Moreover, and perhaps even more important here, Appellants present

absolutely no evidence that they exist as a legally formed Association with standing to

assert a claim against any parcel in the original BPOE Allotment. In their answers to

Appellees’ interrogatories filed with the trial court, Appellants filed for the first time a

copy of a Code of Regulations and By-Laws for “Lake Milton Estates, Inc.,” but that

document is dated September, 2014 and all the signatures were obtained on August 21,

2015. There is no record of registration of the entity with the Ohio Secretary of State

and no proof this document was ever recorded with the Mahoning County Recorder.

Case No. 17 MA 0163 – 12 –

This precludes Appellants’ ability to enforce any restrictions it now claims exist on Lot

819. Moreover, Appellees purchased the property in 2006. The Code of Regulations

and By-Laws for “Lake Milton Estates, Inc.” did not exist at that time, as evidenced by

their own discovery submission. Finally, Lake Milton Estates, Inc. is not synonymous

with Lake Milton Estate Property Owners Association, Inc. or with BPOE Allotment.

Nowhere in the record is there evidence that even if properly formed, these were

successive entities or that they in any way assumed interest in the rights of the original

BPOE Allotment responsible for filing the restrictions in 1952 and 1953. The legal

formation of a homeowner’s association requires more than drafting documentation

never registered with the secretary of state or filed with the recorder. Without evidence

of any succession of interest from the original BPOE Allotment to Appellants, Appellants

cannot assert a claim based on the 1952 and 1953 declarations. Therefore, it appears

Appellants have no legal standing to pursue any claims against Lot 819.

Conclusion

{¶25} A review of the record reveals that, while the 1952 and 1953 restrictions

on Lot 819 contained provisions for lot size, setback and temporary structure usage,

these are not sufficient to demonstrate Appellees had constructive notice a

homeowners association or planned community existed for their parcel. Moreover,

Appellants have not shown they were a properly formed legal entity that has standing to

enforce any claims against property owners in the BPOE Allotment. No question of

material fact appears in this record and the trial court did not err in granting summary

judgment to Appellees. Based on the foregoing, Appellants’ assignment of error is

without merit and the judgment of the trial court is affirmed.

Case No. 17 MA 0163 – 13 –

Robb, P.J., concurs.

Bartlett, J., concurs.

Case No. 17 MA 0163 [Cite as Lake Milton Estate Property Owner Assn., Inc. v. Hufford, 2018-Ohio-4784.]

For the reasons stated in the Opinion rendered herein, the assignment of error is

overruled and it is the final judgment and order of this Court that the judgment of the

Court of Common Pleas of Mahoning County, Ohio, is affirmed. Costs to be taxed

against the Appellants.

A certified copy of this opinion and judgment entry shall constitute the mandate in

this case pursuant to Rule 27 of the Rules of Appellate Procedure. It is ordered that a

certified copy be sent by the clerk to the trial court to carry this judgment into execution.

NOTICE TO COUNSEL

This document constitutes a final judgment entry.