Sanchez v. Cobblestone Homeowners Ass'n of Clayton, Inc. ( 2016 )

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA15-1281
Filed: 6 September 2016
Johnston County, No. 14 CVD 3722
TATITA M. SANCHEZ, Plaintiff,
v.
COBBLESTONE HOMEOWNERS ASSOCIATION OF CLAYTON, INC., a North
Carolina non-profit corporation, Defendant.
Appeal by Defendant from order entered 13 May 2015 by Judge O. Henry
Willis, Jr. in District Court, Johnston County. Heard in the Court of Appeals 23 May
2016.
No brief for Plaintiff-Appellee.
Jordan Price Wall Gray Jones & Carlton, by J. Matthew Waters and Hope
Derby Carmichael, for Defendant-Appellant.
McGEE, Chief Judge.
This appeal is a companion case to four other related cases involving
substantially the same facts, COA15-1280, COA15-1282, COA15-1302, and COA15-
1303. The plaintiffs in all these cases own homes in a community known as the
Cobblestone Subdivision (“the subdivision”). Cobblestone Homeowners Association
of Clayton, Inc., a homeowners association (“Defendant Association”), was created in
order to maintain certain subdivision common areas and to handle the financial
requirements of said management. The common areas relevant to this appeal were
a pool and tennis courts, which were regulated and maintained by Defendant
SANCHEZ V. COBBLESTONE HOMEOWNERS ASS’N OF CLAYTON, INC.
Opinion of the Court
Association, and which were, pursuant to Defendant Association’s covenants,
allegedly open to all residents of the subdivision who paid the regular homeowners
association fees or dues (“the dues”).
Tatita Sanchez (“Plaintiff”) owned a home (“the property”) in the subdivision,
and was regularly paying dues Defendant Association assessed until she received a
letter on or about 30 July 2014 from the then counsel for Defendant Association. In
that letter, Defendant Association informed Plaintiff that, as a result of an earlier
mistake, Plaintiff and certain other homeowners1 in the subdivision were not
members of Defendant Association. The letter further informed Plaintiff and
similarly situated homeowners that, if they wanted to continue enjoying the pool,
tennis courts and other benefits and responsibilities of membership in Defendant
Association, they would have to execute a “Supplemental Declaration” to bring
themselves and their properties within Defendant Association’s authority, and
continue to pay the dues.
Plaintiff decided not to join Defendant Association, and requested return of the
dues she had been erroneously charged over the years. Defendant Association
refused to reimburse Plaintiff for dues already paid, so Plaintiff filed a complaint in
small claims court on 31 October 2014, seeking reimbursement. The magistrate in
small claims court ruled in favor of Plaintiff by judgment entered 1 December 2014,
1 Including Plaintiffs in the companion cases.
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and Defendant Association appealed to district court. Plaintiff’s action was heard on
20 April 2015, and the trial court again ruled in favor of Plaintiff by order entered 13
May 2015. Defendant Association appeals.
I. Standard of Review
This matter was decided by the trial court sitting without a jury.
“[W]hen the trial court sits without a jury, the standard of
review on appeal is whether there was competent evidence
to support the trial court’s findings of fact and whether its
conclusions of law were proper in light of such facts.”
. . . . The trial court’s conclusions of law, by contrast,
are reviewable de novo.
Lake Toxaway Cmty. Ass’n, Inc. v. RYF Enters., Inc., 226 N.C. App. 483, 487, 742
S.E.2d 555, 559 (2013) (citations omitted). Because Defendant Association does not
contest any of the trial court’s findings of fact in this matter, they are binding on
appeal. Id. at 489, 742 S.E.2d at 560. Our review is therefore limited to determining
whether the trial court’s findings of fact support its conclusions of law. Id. at 487,
742 S.E.2d at 559. Our review is further limited to those arguments Defendant
Association brings forth on appeal. “Issues not presented in a party’s brief, or in
support of which no reason or argument is stated, will be taken as abandoned.” N.C.
R. App. P. App. R. 28(b)(6) (2016).
II. Analysis
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On appeal, Defendant Association contends that “the trial court erred as a
matter of law in concluding that [Plaintiff] was entitled to a return of assessments
paid in the amount of $4,000.00.” We disagree.
Defendant Association’s contention is based upon two specific arguments: (1)
“The trial court erred in concluding that no contract existed between [Plaintiff] and
[Defendant Association] given the facts established an implied in fact contract existed
between the parties[,]” and (2) “the trial court erred in failing to conclude that
[Plaintiff] was estopped from denying the obligation to pay assessments to [Defendant
Association.]” We limit our review to these two specific arguments, and address each
argument in turn.
A. Contract Implied in Fact
Defendant Association first argues “the trial court erred in concluding that no
contract existed between [Plaintiff] and [Defendant Association] given the facts
established an implied in fact contract existed between the parties.” We disagree.
Though somewhat couched in terms of “unjust enrichment,” the argument
made by Defendant Association is actually restricted to the presence or absence of a
contract implied in fact that would have bound Plaintiff to pay the dues. Defendant
Association put its argument to this Court in the following manner:
Where the facts establish that [Plaintiff] received benefits
from [Defendant Association], and [Plaintiff] had clear
knowledge of such benefits and services being provided by
[Defendant Association], an implied in fact contract exists
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between [Plaintiff] and [Defendant Association]. If the
evidence demonstrates that [Plaintiff] consciously accepted
the benefits and services provided by [Defendant
Association], the trial court cannot conclude that [Plaintiff]
unjustly enriched [Defendant Association] by paying [the
dues]. (Citation omitted).2
At trial Defendant Association argued, inter alia, that, because there existed a
contract implied in fact between the parties, the trial court could not base any remedy
upon the theory of unjust enrichment. Unjust enrichment may be found when there
exists a contract implied in law, and recovery based upon unjust enrichment is
improper when an actual contract – such as a contract implied in fact – exists.3
Quantum meruit is a measure of recovery for the
reasonable value of services rendered in order to prevent
unjust enrichment. It operates as an equitable remedy
based upon a quasi contract or a contract implied in law.
“A quasi contract or a contract implied in law is not a
contract.” An implied [in law] contract is not based on an
actual agreement, and quantum meruit is not an
appropriate remedy when there is an actual agreement
between the parties. Only in the absence of an express
agreement of the parties will courts impose a quasi
contract or a contract implied in law in order to prevent an
unjust enrichment.
2 The dissenting opinion references a quote found in the “Standard of Review” section of
Defendant Association’s argument: “‘The findings of fact in this matter simply do not support the trial
court’s conclusion of law that [Plaintiff’s] payment of assessments to [Defendant Association] unjustly
enriched [Defendant Association].’” Though Defendant Association does make this statement in its
brief, it does not cite any law laying out the elements of unjust enrichment in its brief, and does not
make any direct argument that Plaintiff failed to satisfy her burden of presenting evidence in support
of all the required elements. This is because Defendant Association’s argument does not depend on
whether the elements of unjust enrichment were established.
3 “Although the terms of an implied in fact contract may not be expressed in words, or at least
not fully in words, the legal effect of an implied in fact contract is the same as that of an express
contract in that it too is considered a ‘real’ contract or genuine agreement between the parties.” Miles
v. Carolina Forest Ass'n, 167 N.C. App. 28, 36, 604 S.E.2d 327, 333 (2004).
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Whitfield v. Gilchrist, 348 N.C. 39, 42, 497 S.E.2d 412, 414–15 (1998) (citations
omitted). In fact, the mere existence of a contract implied in law would make any
consideration of the equitable remedy of unjust enrichment improper. Booe v.
Shadrick, 322 N.C. 567, 570, 369 S.E.2d 554, 556 (1988) (citation omitted) (“If there
is a contract between the parties the contract governs the claim and the law will not
imply a contract [in law].”).4
Our review of this argument is entirely limited to whether or not a contract
implied in fact existed between Plaintiff and Defendant Association. If such a
contract existed, Plaintiff was thereby obligated to pay the dues, and the trial court’s
order should be reversed. If no such contract existed, the trial court should be
affirmed because Defendant Association makes no further argument on appeal.5
This Court has stated:
[A] contract implied in fact . . . arises where the intention
of the parties is not expressed, but an agreement in fact,
creating an obligation is implied or presumed from their
4 In Lake Toxaway, discussed in detail below, this Court held that an implied in fact contract
existed which obligated the defendant to pay property maintenance fees. This Court further held that
absent payment of those fees, the defendant would be unjustly enriched. Having held that a contract
existed between the parties, the additional holding related to unjust enrichment was legally incorrect
unless viewed as an alternative holding should its finding that a contract implied in fact existed be
overturned. See Ellis Jones, Inc. v. W. Waterproofing Co., 66 N.C. App. 641, 646–47, 312 S.E.2d 215,
218–19 (1984). We view these holdings as alternative holdings. Further, in Miles, also discussed in
detail below, though the plaintiffs argued that there was “insufficient evidence of unjust enrichment
for the court to grant a directed verdict in favor of [the] defendant under the theory of an implied
contract[,]” this Court determined that the implied contract was one of fact, not law, and therefore
damages were based upon breach of that contract, not unjust enrichment. Miles, 167 N.C. App. at 34,
37, 604 S.E.2d at 332, 34.
5 Excepting Defendant Association’s argument concerning estoppel, which we consider below.
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acts[.] With regard to contracts implied in fact, . . . one
looks not to some express agreement, but to the actions of
the parties showing an implied offer and acceptance.
Lake Toxaway, 226 N.C. App. at 488, 742 S.E.2d at 560 (citation omitted). Defendant
Association contends that the actions of Plaintiff and Defendant Association created
a contract implied in fact for the payment of the dues in exchange for the benefits of
membership in Defendant Association.
The trial court made the following relevant findings of fact and conclusions of
law:
3. At or about the time that [P]laintiff acquired the
property, [P]laintiff was informed and believed that said
property was subject to said covenants and that the
property was a part of and subject to the rules of
[D]efendant [Association].
4. In accordance with the rules and covenants, Plaintiff
paid periodic dues . . . to [D]efendant [Association] from at
or about the time Plaintiff was notified of said [dues] until
approximately July 30, 2014.
5. By letter from the attorney for the Defendant
[Association] dated July 30, 2014, [P]laintiff was notified
that the property was not and had never been subject to
the covenants. The requirement that the aforesaid periodic
[dues] be paid was a condition of the covenants.
6. Plaintiff rarely, if ever, used the tennis courts or
swimming pool, which were the main two amenities offered
by [D]efendant [Association].
7. Plaintiff, without legal obligation has paid to
[D]efendant [Association] periodic [dues] payments in the
total sum of $4,000.00.
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8. Plaintiff was not aware of nor had any reasonable way of
knowing that there was no legal obligation to pay periodic
dues . . . until [P]laintiff received the letter referred to in
paragraph 5 above.
9. Defendant [Association] had no legal right to require or
receive payments from [P]laintiff.6
CONCLUSIONS OF LAW
....
3. No contract or other legal obligation existed between the
parties as would require Plaintiff to pay periodic dues . . . to
Defendant [Association].
4. Plaintiff’s payments to defendant resulted in
[D]efendant [Association] being unjustly enriched in the
total amount of the payments made.
As Defendant Association does not challenge the findings of fact, nor argue
that the trial court should have made additional findings of fact, we restrict out
analysis to whether those findings support the trial court’s conclusion that no
contract existed between Plaintiff and Defendant Association requiring payment of
the dues. Lake Toxaway, 226 N.C. App. at 489, 742 S.E.2d at 560. The findings
establish the following: (1) Plaintiff was informed that the property was subject to
6 The findings of fact include no reference to Plaintiff attending a homeowner’s meeting, being
provided with a key to the pool, nor that she called Defendant Association on occasion concerning
homeowner’s issues. In its brief, Defendant Association did improperly attempt to argue that Plaintiff
contacted Defendant Association regarding a homeowner’s issue. We restrict our review to those facts
actually found as fact in the trial court’s order.
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covenants requiring her to pay periodic dues; (2) Plaintiff was in fact not obligated to
pay the dues, and did not have any reason to know she was not legally obligated to
pay the dues until informed pursuant to the 30 July 2014 letter from Defendant
Association; (3) based upon Defendant Association’s erroneous assertions and
requests, Plaintiff paid $4,000.00 to Defendant Association as “dues;” and (4) Plaintiff
“rarely, if ever, used the tennis courts or swimming pool, which were the main two
amenities offered by [D]efendant [Association].”
Defendant Association argues that this Court’s opinions in Lake Toxaway and
Miles require that we find a contract implied in fact existed between Plaintiff and
Defendant Association. In Lake Toxaway, developer Lake Toxaway Company (“LTC”)
developed certain real property (“the development”) which included a man-made lake
(“the lake”) and individual building lots. Lake Toxaway, 226 N.C. App. at 485-86, 742
S.E.2d at 558. In 2000, the defendant purchased a lot (“the lot”), located within the
development. Id. at 485, 742 S.E.2d at 558. Access to the lake was granted by deed
to certain property owners within the development, but LTC contended that lake
privileges were not specifically granted appurtenant to the lot. Id. at 486, 742 S.E.2d
at 558. The plaintiff was the property owners association for the development. Id.
The plaintiff and LTC entered into an agreement in December 2003 whereby the
plaintiff became responsible for maintaining certain common areas within the
development, including the lake and the rights-of-way for the private roads that
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provided access to the individual parcels of property in the development, including
the lot. Id. The plaintiff delivered an invoice to the defendant in 2008, demanding
the defendant pay an amount representing its pro-rata share of the costs of
maintaining the roads and the lake for the 2008-09 fiscal year. Id. The defendant
refused to pay, and the plaintiff initiated an action to determine the rights and
obligations of the parties. Id. The trial court ruled that a contract implied in fact
had been created by the actions of the plaintiff and the defendant. Id. at 487, 742
S.E.2d at 559.
Upon review of the trial court’s ruling, this Court noted: “It is uncontested that
plaintiff’s upkeep, repair, and maintenance of the dam, Lake Toxaway, roads, and
common areas have conferred a measurable benefit on defendant.” Lake Toxaway,
226 N.C. App. at 491, 742 S.E.2d at 561. This Court then held:
Since August 1965, when [the lot] was first deeded by LTC,
subsequent owners of the [lot,] including defendant, have
used [the lake] continuously for boating and other
recreational purposes. See Snyder, 300 N.C. at 218, 266
S.E.2d at 602 (stating that “[a]cceptance by conduct is a
valid acceptance”). [The d]efendant has also used the
private roads, containing multiple points of access, within
[the development]. [The d]efendant benefits from having
the availability of well-maintained and secured private
roads to and from the [lot] and for travel within [the
development], in addition to a well-maintained and secure
[lake] and dam.
We agree with the trial court that:
[w]ith knowledge of the services provided by the
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[p]laintiff in maintaining and managing the operations
and care of the private roads, roadsides, and [the lake],
[the d]efendant agreed by its conduct . . . in using or
claiming the right to use the private roads and lake so
maintained and managed by the [p]laintiff to pay for the
maintenance, repair and upkeep of the roads, roadsides,
and lake.
Because the uncontested findings of fact support the trial
court’s conclusion that implicit in [the] defendant’s
acceptance of the benefits of using the roads and the lake,
was an agreement to pay for the upkeep, maintenance and
repair of the roads and lake. Therefore, based on the record
before us, we hold that a contract implied in fact existed
between the parties.
Id. at 489-90, 742 S.E.2d at 560-61 (citation omitted). The ruling in Lake Toxaway
was thus based upon the “defendant’s acceptance of the benefits of using the roads
and the lake,” and other amenities, Id. at 490, 742 S.E.2d at 561 (emphasis added),
not upon the mere existence of those benefits.
In Miles, the covenants of the defendant homeowner’s association, Carolina
Forest Association (“CFA”), of a subdivision (“Carolina Forest”) required all real
property owners in Carolina Forest to pay association fees for the purposes of
maintenance and upkeep of common roads and recreation areas. Miles, 167 N.C. App.
at 29, 604 S.E.2d at 329. The covenants included a clause whereby the covenants
would expire on 1 January 1990. CFA believed that the covenants could be extended
if the owners of two-thirds of Carolina Forest lots agreed in writing to do so. Id. at
29-30, 604 S.E.2d at 329. The owners of just over two-thirds of Carolina Forest lots
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did agree to extend the covenants, and all the plaintiff lot owners continued to pay
the maintenance fees until at least 1997. Id. at 30, 604 S.E.2d at 329. In 1998, the
plaintiffs filed an action requesting the trial court rule that they were not obligated
to pay the maintenance fees based upon an argument that the 1990 “amendment” to
the covenants did not bind them. Id. at 31, 604 S.E.2d at 329-30. The trial court
ultimately determined there existed a contract implied in fact based upon the benefits
the plaintiffs’ had received. Id. at 31, 604 S.E.2d at 330. This Court held:
Plaintiffs were assessed specific fees for benefits to their
unimproved properties. These benefits protected both the
access to and the value of their properties, by way of
maintaining private roads, recreational facilities, a pool, a
guard station, and an administrative office. The record
shows that plaintiffs were on clear notice that these
benefits were being incurred: Approximately half of them
actually voted for the amendments to declaration No. 10 as
recorded in 1990, which included consent to pay the
assessment fees for the exact benefits at issue in this case.
All of the plaintiffs had paid some or all of the fees and
assessments up until 1997 and 1998, and were incurring
the benefit from the improvements funded by such
payments. This conduct is consistent with the existence of
a contract implied in fact, and plaintiffs’ attempt to stop
payment on these known benefits, without more, is
tantamount to breach of that contract.
Id. at 37, 604 S.E.2d at 333-34. Unlike in the present case, the plaintiffs in Miles
continued to pay the contested fees after they were aware of the events which brought
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the validity of those fees into question.7 This act of continued payment strongly
suggested that the plaintiffs recognized they were receiving a benefit in return for
those payments, even if they disputed that the extension of the covenants applied to
them. In the present case, Plaintiff immediately ceased paying the association fees
once Defendant Association informed her that she was under no legal obligation to
continue doing so.
Further, in both Lake Toxaway and Miles, the trial court ruled that the
property owners directly benefitted by the actions of the relevant homeowners
associations in maintaining roadways and other common areas. As an obvious
example, the property owners in those two cases could not access their properties in
any meaningful manner absent the roadways maintained through association fees. 8
For this reason, in both cases this Court held that the trial court had not erred in
finding the existence of a contract implied in fact. However, in the present case, the
trial court ruled that Plaintiff “rarely, if ever” used the “main amenities” maintained
by the association dues collected by Defendant Association.9 The trial court did not
7 In Miles, the plaintiffs continued to pay association fees after 1 January 1990, the expiration
date of the covenants absent amendment. If the plaintiffs believed the amendment to the covenants
did not obligate them to pay association fees after 1 January 1990, they could have contested their
obligations at that time.
8 There is no evidence, nor finding of fact, that the dues in the present case went toward
maintenance of the subdivision roads or any other common area necessary for Plaintiff to enjoy the
property.
9 We note that in companion appeal COA15-1282 the trial court found that Plaintiff Frank
Christopher and his family “never used” the pool and tennis courts, and that he was not benefitted by
Defendant Association.
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find as fact that Plaintiff benefitted in any other manner from services rendered by
Defendant Association. On these facts, we hold that the trial court did not err in
concluding that no contract implied in fact had been created between Plaintiff and
Defendant Association.
We further note that if a contract had existed between Plaintiff and Defendant
Association, Defendant Association would also have been bound by that contract.
However, by its 30 July 2014 letter to Plaintiff, Defendant Association, through
counsel, informed Plaintiff that the property was “not subject to [Defendant
Association’s] declaration[.]” Defendant Association informed Plaintiff that, in order
to become a member of Defendant Association and be allowed access to the pool or
tennis courts, Plaintiff would be required to execute a “‘Supplemental Declaration’
. . . where [Plaintiff] agree[d] to be subject to the terms and provisions of [Defendant
Association.]” Had there been an enforceable implied in fact contract between
Plaintiff and Defendant Association, Defendant Association would not have been able
to deny Plaintiff the amenities provided by [Defendant Association] regardless of
whether Plaintiff executed any “supplemental declaration.” Defendant Association’s
argument seems to be that there was no contract enforceable by Plaintiff, but that
there was a contract enforceable by Defendant Association.
This Court is not called upon to make an independent determination of
whether Defendant Association was unjustly enriched; we are called upon to
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determine whether Defendant Association’s arguments on appeal have merit. It is
not the job of this Court to “create an appeal for” Defendant Association. Viar v. N.C.
Dep’t of Transp., 359 N.C. 400, 402, 610 S.E.2d 360, 361 (2005).
Defendant Association bases its argument on cases in which this Court found,
by the actions of the parties involved, the mutual agreement necessary to form a
contract implied in fact. Specifically, this Court in Lake Toxaway found that “the
plaintiffs received benefits to their properties and the plaintiffs were on clear notice
that these benefits were being incurred[.]” Lake Toxaway, 226 N.C. App. at 490, 742
S.E.2d at 560. “‘Whether mutual assent is established and whether a contract was
intended between parties are questions for the trier of fact.’” Lake Toxaway, 226 N.C.
App. at 488, 742 S.E.2d at 560 (emphasis added) (citing Miles, 167 N.C. App. at 37,
604 S.E.2d at 333–34). The only “benefit” found by the trial court in the present case
was that Plaintiff “rarely, if ever, used the tennis courts or swimming pool[.]”10 We
can only conclude that the trial court determined that this “benefit” was insufficient
to establish mutual assent between Plaintiff and Defendant Association, and thus no
contract between the parties was intended. This was the trial court’s determination
to make. Id. Defendant Association, by its own actions upon discovering Plaintiff’s
10 The dissenting opinion points to evidence indicating that Plaintiff used the pool “on
occasion.” However, our job is not to find facts based upon the evidence presented at trial, it is to apply
the law to the facts found by the trial court based upon that evidence. We note that in four of the five
companion cases, including the present case, the trial court used identical language: “Plaintiff rarely,
if ever, used the tennis courts or swimming pool[.]” In the fifth companion case, COA15-1282
Christopher, the trial court found as fact that Plaintiff Christopher never used these amenities.
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property was not subject to its covenants, indicated that it did not believe any contract
existed. Had a contract existed, Defendant Association could not have denied
Plaintiff access to any of its benefits, so long as Plaintiff continued to pay dues,
regardless of whether Plaintiff executed the “supplemental declaration” to bring her
and her property within Defendant Association’s authority. However, Defendant
Association made continued availability of access to its benefits contingent upon
Plaintiff executing the “supplemental declaration.”
In addition, we are not persuaded by the dissenting opinion’s analogy of the
facts before us to membership in a health club. When someone joins a health club,
that person executes a contract requiring fees be paid in return for access to certain
facilities. In the present case, we are called upon to determine whether any such
contract existed between Plaintiff and Defendant Association. It is uncontested that
those homeowners who were contractually obligated to pay dues to Defendant
Association were so obligated whether or not they took advantage of any of Defendant
Association’s benefits.
Assuming arguendo some of the trial court’s findings are in fact conclusions,
as the dissenting opinion contends, we do not see how our analysis would change.
Importantly, whether a finding or a conclusion, it is the duty of Defendant
Association, as the appellant, and not the duty of this Court, to challenge findings
and conclusions, and make corresponding arguments on appeal. It is not the job of
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this Court to “create an appeal for” Defendant Association. Viar v. N.C. Dep’t of
Transp., 359 N.C. 400, 402, 610 S.E.2d 360, 361 (2005). Defendant Association does
not argue that the trial court erred in either finding or concluding that “Plaintiff was
not aware of nor had any reasonable way of knowing that there was no legal
obligation to pay periodic dues or association fees until [P]laintiff received the letter”
dated 30 July 2014.11 Defendant Association does not argue that Plaintiff was
charged with notice as a matter of law through her chain of title that she was not
required to pay the dues. Defendant Association makes no mention of, much less
argument concerning, the chain of title to Plaintiff’s property. Any such arguments
have therefore been abandoned. “It is not the duty of this Court to supplement an
appellant’s brief with legal authority or arguments not contained therein. Th[ese]
[arguments are] deemed abandoned by virtue of N.C. R. App. P. 28(b)(6) (2005).”
Goodson v. P.H. Glatfelter Co., 171 N.C. App. 596, 606, 615 S.E.2d 350, 358 (2005).
We are not called upon to determine the equities involved in this case, we are called
upon to render a legal opinion on the issue of whether there existed between Plaintiff
and Defendant Association a contract implied in fact that obligated Plaintiff to pay
the dues.
The dissenting opinion would hold that access to benefits alone is sufficient to
meet the requirements set forth in Lake Toxaway and Miles, irrespective of whether
11 We note that this is not a conclusion by the trial court concerning Plaintiff’s legal obligation
to pay, it is a finding related to Plaintiff’s understanding of what her obligations were.
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those available benefits were actually enjoyed. We believe the law requires
something more.
B. Estoppel
In Defendant Association’s second argument, it contends the trial court erred
in “failing to conclude that [Plaintiff] was estopped from denying the obligation to pay
assessments[.]” We disagree.
Defendant Association cites to this Court’s opinion in Reidy v. Whitehart Ass’n,
185 N.C. App. 76, 648 S.E.2d 265 (2007), for the proposition that Plaintiff should be
equitably estopped from denying
the validity of [Defendant Association], at least until July
2014. [Plaintiff] accepted membership within [Defendant
Association] at the closing of the purchase of her home and
paid her first assessments then. . . . .12 [Plaintiff] at all
times had the right to enter and use the pool and tennis
courts, and used the pool on one occasion. [Plaintiff] paid
quarterly assessments as she believed she was required to
do under the covenants and as a member of [Defendant
Association], without objection.
As this Court stated in Reidy: “‘Under a quasi-estoppel theory, a party who
accepts a transaction or instrument and then accepts benefits under it may be
estopped to take a later position inconsistent with the prior acceptance of that same
transaction or instrument.’” Reidy, 185 N.C. App. at 80, 648 S.E.2d at 268-69
12 Defendant Association argues certain alleged facts that are not included in the findings of
fact for the 13 May 2015 order. Our review is limited to the facts as found by the trial court in its
order. Lake Toxaway, 226 N.C. App. at 489, 742 S.E.2d at 560.
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(citation omitted). The only potential benefit “accepted” by Plaintiff and found as fact
by the trial court was that “Plaintiff rarely, if ever, used the tennis courts or
swimming pool[.]” We hold the trial court did not err in failing to find Plaintiff was
estopped from accepting the validity of “Defendant Association” or the validity of any
“obligation to pay assessments to [Defendant Association.]”
AFFIRMED.
Judge HUNTER, JR. concurs.
Judge DILLON dissents with separate opinion.
- 19 -
No. COA15-1281 – SANCHEZ V. COBBLESTONE HOMEOWNERS ASS’N OF
CLAYTON, INC.
DILLON, Judge, dissenting.
I do not believe that the trial court’s findings support its conclusion that the
HOA was unjustly enriched by its receipt of dues from Homeowner from 2002-2014.
Rather, as the HOA argues, the findings support a conclusion that the parties had a
contract, implied-in-fact, whereby the parties agreed – as evidenced by their conduct
– that the HOA would allow Homeowner access to amenities/benefits in return for
the dues paid by Homeowner. See Revels v. Miss Am. Org., 182 N.C. App. 334, 337,
641 S.E.2d 721, 724 (2007) (“With regard to contracts implied in fact, . . . one looks
not to some express agreement, but to the actions of the parties showing an implied
offer and acceptance.”).
As shown by the uncontradicted evidence in the record, the trial court
essentially found that (1) Plaintiff (“Homeowner”) purchased her home in 2002
believing she would be part of the Defendant homeowners’ association (the “HOA”),
allowing her access to the HOA amenities in exchange for her payment of dues; 13 (2)
Homeowner paid the HOA dues for a number of years; (3) the HOA provided
13 This finding is supported by Homeowner’s admission that she believed she would be part of
the HOA when she bought her home; that the appraisal ordered by her lender states that the home
she was buying included the right to access HOA amenities (swimming pool and tennis courts); and
that the HOA accounting reflects dues she paid to the HOA as part of her 2002 closing.
SANCHEZ V. COBBLESTONE HOMEOWNERS ASS’N OF CLAYTON, INC.
DILLON, J., dissenting
Homeowner access to amenities;14 (4) in 2014, the HOA sent Homeowner a letter
which informed Homeowner that the HOA had learned that Homeowner’s home was
not included as part of the recorded HOA declarations, but that the HOA was willing
to execute the necessary paperwork for filing to include her home in the
declarations.15
I do not agree with the majority that the trial court’s finding that Homeowner
“rarely, if ever” used the HOA amenities has any bearing: The implied-in-fact
contract was that Homeowner was paying for access to the HOA amenities; the actual
number of times Homeowner took advantage of her right of access is not relevant.16
The trial court essentially found that Homeowner was provided this benefit of access,
stating that the HOA provided a swimming pool and tennis courts. See Miles v.
Carolina Forest Ass’n, 167 N.C. App. 28, 37, 604 S.E.2d 327, 333-34 (2004) (holding
that an implied-in-fact contract existed where plaintiffs, who were lot owners in a
subdivision, received benefits to their properties and that plaintiffs were on notice
that these benefits were being incurred).17 The effect of the presence of an implied-
14 This finding is supported by Homeowner’s admission that the HOA provided her with a key
to the HOA pool; that she used it on occasion (though not often); and that she attended at least one
HOA meeting.
15 The letter identified in the trial court’s finding is part of the record.
16 The trial court’s “rarely, if ever,” phrase is imprecise. The record, however, is
uncontradicted. Homeowner admitted that the HOA provided her with a key to the pool; that she did
use the pool on a few occasions; that she did call the HOA on occasions about HOA issues; and that
she attended at least one HOA meeting.
17 I note that the HOA also argues “estoppel.” I agree that alternatively Homeowner is
estopped from claiming a refund of her dues. The findings showed that she acted as if she were a
member of the HOA and had access to the HOA amenities.
2
SANCHEZ V. COBBLESTONE HOMEOWNERS ASS’N OF CLAYTON, INC.
DILLON, J., dissenting
in-fact contract, here, is similar to an express contract to join a health club: The dues
are earned by the club whether the member uses the facilities thirty times each
month, or never. Accordingly, I respectfully dissent.
While I agree with the majority that the HOA is bound by the trial court’s
findings, I note that many of the statements designated as “findings” are actually
mislabeled conclusions of law. For instance, the trial court’s statement that the HOA
“had no legal right to require or receive payments from [Homeowner]” is clearly a
legal conclusion.
Also, the trial court’s statement that “[Homeowner] … had [no] reasonable way
of knowing that there was no legal obligation” to pay assessments is a conclusion of
law. Whether Homeowner had a legal obligation to pay dues is a question of law.
And the statement that Homeowner had no reasonable way of knowing that her home
was not part of the HOA declaration is incorrect as a matter of law. Specifically, our
Supreme Court has long recognized the bedrock principle that, as a matter of law, “a
purchaser [of real estate] is charged with notice of the contents of each recorded
instrument constituting a link in [her] chain of title and is put on notice of any fact
or circumstance affecting [her] title which any such instrument would reasonably
disclose.” Randle v. Grady, 224 N.C. 651, 656, 32 S.E.2d 20, 22 (1944). See also
Hughes v. N.C. State Highway, 275 N.C. 121, 130, 165 S.E.2d 321, 327 (1969); Turner
v. Glenn, 220 N.C. 620, 625, 18 S.E.2d 197, 201 (1942); Holmes v. Holmes, 86 N.C.
3
 SANCHEZ V. COBBLESTONE HOMEOWNERS ASS’N OF CLAYTON, INC.
DILLON, J., dissenting
205, 209 (1882); Harborgate Prop. Owners. Ass’n v. Mt. Lake Shore, 145 N.C. App.
290, 293-94, 551 S.E.2d 207, 210 (2001).18
Finally, I note that the HOA states in its brief that “[t]he findings of fact in
this matter simply do not support the trial court’s conclusion of law that
[Homeowner’s] payment of assessments to [the HOA] unjustly enriched [the HOA].”
Assuming that this statement is sufficient to preserve our consideration beyond the
HOA’s arguments concerning an implied-in-fact contract and estoppel, I note that the
Supreme Court has held that an unjust enrichment occurs where a party to a contract
which is technically unenforceable “expends money as contemplated by the contract,
and the other party to the contract consciously receives or accepts the benefits thereof
and then fails or refuses to perform his part of the special contract[.]” Wells v.
Foreman, 236 N.C. 351, 354, 72 S.E.2d 765, 767 (1952). Here, Homeowner did expend
money. The trial court’s findings, however, also reveal that the HOA did not fail or
refuse to perform its part of the agreement, but in fact recognized Homeowner as a
member of the HOA and provided her with full access to its amenities. Therefore,
based on Wells, the HOA has not been unjustly enriched.
18 Any suggestion that the HOA has failed to challenge the mislabeled conclusions of law would
be overly technical. Though the HOA may not have referred to the trial court’s mislabeled conclusions
expressly, the HOA’s main argument is that the Homeowner did have a legal obligation to pay dues,
based on a contract, implied-in-fact, in return for the years of access she had to the HOA amenities.
4