# Bank with actual knowledge of intent to create homeowners association bound by covenants even though the mortgage was recorded before the homeowners assocation declaration

An appellate court in New Jersey held that a bank that received a mortgage on a piece of property was bound by a later-recorded homeowners association covenants because it had actual knowledge that the developer planned to subject the property to the declaration. Fulton Bank of N.J. v. Casa Eleganza, 473 N.J. Super. 387, 281 A.3d 252 (N.J. App. Div. 2022). This was the case even though New Jersey...

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# Scope of easement to operate a neighboring golf course determines whether intrusion of dozens of golf balls a year to victims’ property constitutes a trespass

A couple that bought a home next to a golf course sued the golf course for trespass because of all the golf balls that landed on their property. Although the golf course attempted to take remedial measures to stop golf balls from landing on the couple’s property, roughly 90 balls would land on the property each year, a dozen of which struck the house. The couple won in the trial court which awarded them $100,000 in compensatory damages for property damage and$3.4...

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# Short-term rentals do not violate “residential use only” covenant

The Mississippi Supreme Court has held that short term rental of property is not a commercial use that would violate a covenant limiting land to residential purposes. Lake Serene Prop. Owners Ass’n v. Esplin, 334 So.3d 1139 (Miss. 2022). There has been some disagreement among state courts on this question because the use of property as an Airbnb or other short term...

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# Parcel is landlocked after 90 year easement ends

Most courts granted an easement by necessity when an owner severs its land and leaves a parcel without access to a public road. The easement allows passage over land that had been connected to the landlocked parcel before it became landlocked. The courts differ on whether this is a mandatory rule of law (owners are not allowed to create land to which there is no access) or a default rule based on the implied intent of the parties, in which case the...

# Washington Supreme Court holds racial covenants in public records must be retained but can be marked void

Construing a state statute, Wash. Stat. §49.60.227, the Washington Supreme Court held that racial covenants cannot be completely excised from public records. The court determined that the statute allowed a court order to be filed with the recorded title voiding the covenant but did not authorize excising the covenant from the public records entirely. This result occurred despite the fact that the statute provided that courts should “strik[e] the void provisions from the public records.” Wash. Stat. §49.60.227(1)(b). The statute did provide that the original record “shall be separately... Read more about Washington Supreme Court holds racial covenants in public records must be retained but can be marked void

# Covenants cannot be amended retroactively if this violates homeowners’ legitimate expectations

he Arizona Supreme Court has limited the powers of homeowners associations to amend covenants retroactively when those amendments would unfairly surprise buyers who were not on notice of them when they bought their properties. Kalway v. Calabria Ranch HOA, LLC, 506 P.3d 18 (Ariz. 2022). In this case, the homeowners association adopted new restrictions...

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# Covenants that prohibit all leasing restrictions include short-term rentals

The Texas Supreme Court has held that covenants that prohibit all restrictions on leasing cannot prohibit short term rentals, finding that a lease is still a lease if it only lasts for one day. JBrice Holdings, LLC v. Wilcrest Walk Townhomes Ass’n, Inc., 2022 WL 1194364 (Tex. 2022). In addition, short-term rentals were held not to be “commercial” or “non-residential uses.” The court noted that the covenants provided that they could be retroactively amended through a 75% vote of the owners.

# Covenants can burden future interests, at least where environmental protection is concerned

A California appellate court interpreted a conveyance to include both a fee simple subject to condition subsequent with a right of entry in the grantor and a conservation easement limiting the property as “natural open space.” While it is not clear the court interpreted the conveyance correctly, it is significant that the court found that an easement (or covenant) can coexist with a right of entry. If structured correctly, such a conveyance would mean that a grantor can both require title to be forfeited to the grantor (or its assignees) if the current possessor violates a conservation... Read more about Covenants can burden future interests, at least where environmental protection is concerned

# No prescriptive easements for light and air

Re-affirming a longstanding common law rule, a Maryland court has held that land use that interferes with a neighbor’s desire for unobstructed light and air neither constitutes a nuisance nor can the neighbor acquire such rights by prescription. Gestamp Wind N. Am., Inc. v. All. Coal, LLC, 2021 WL 3612747 (Md. Ct. Spec. App. 2021). A neighbor whose wind turbines were losing effectiveness because the neighbor was piling coal remains on its property could not get a remedy for the change in wind to run... Read more about No prescriptive easements for light and air