Retroactive restraint on short term leasing by homeowners association upheld by Idaho Supreme Court

When a homeowner's association voted to amend the declaration of covenants, conditions, and restrictions to prohibit short term leasing of units (rentals for less than six months), one of the townhouse owners sued to declare the retroactive restraint on alienation invalid. However, the Idaho Supreme Court found the retroactive restraint to be valid; it neither constituted an unreasonable restraint on alienation or exceeded the scope of the powers of the association to amend the declaration retroactively. Adams v. Kimberley One Townhouse Owner's Ass'n, 352 P.3d 492 (Idaho 2015).

The court held that the amendment to the declaration was merely an interpretation of what it meant to devote the property to single-family residential purposes and thus could not be unduly surprising to the owner. Moreover, the association had the power to amend the covenants and that amendment power subjected the individual owner to retroactive changes in ownership rights.

While some courts would decide this case the other way, see Wilkinson v. Chiwawa Cmtys. Ass'n, 327 P.3d 614 (Wash. 2014),  most agree that retroactive restraints on leasing are enforceable when adopted by condominium or homeowners' associations.