Waterford Harbor Master Association v. Michael Landolt and Ann Wismer

Appellees’ Motion for Rehearing Overruled; Appellees’ Motion for En Banc
Consideration Denied as Moot; Memorandum Opinion of November 6, 2014
Withdrawn; Affirmed in Part, Reversed and Rendered in Part, and Substitute
Memorandum Opinion filed January 22, 2015.
In The
Fourteenth Court of Appeals
NO. 14-13-00817-CV
WATERFORD HARBOR MASTER ASSOCIATION, Appellant
V.
MICHAEL LANDOLT AND ANN WISMER, Appellees
On Appeal from the 56th District Court
Galveston County, Texas
Trial Court Cause No. 12-CV-2145
SUBSTITUTE MEMORANDUM OPINION
We overrule appellees’ motion for rehearing, deny appellees’ motion for en
banc consideration as moot, withdraw our opinion issued November 6, 2014, and
issue this substitute memorandum opinion.
Appellant, Waterford Harbor Master Association (“Waterford”), appeals a
final judgment rendered in a suit for declaratory relief and monetary damages filed
by appellees, Michael Landolt and wife, Ann Wismer, (“the Landolts”), and on
Waterford’s counterclaim for declaratory relief. We affirm in part, and reverse and
render in part.
I. BACKGROUND
Waterford Harbor is a subdivision in Galveston County comprised of
different types of residences, a marina, and parks. In 1991, the Landolts purchased
a home in the Waterford Oaks section (“the Oaks”) of Waterford Harbor. The
Oaks is an exclusive, private section within Waterford Harbor; access to this
section is through a second gate. Within the Oaks is a park area, (“the Oaks park”)
which is accessible to residents of Waterford Harbor and the Oaks.
To “create certain easements, [and] . . . assessments . . . in a consistent,
compatible, and mutually beneficial manner,” the developer promulgated a
“Master Declaration of Restrictive Covenants” (“Master Declaration”). The
Master Declaration was executed and filed of record in 1991—there is no dispute
that it burdens the Landolts’ property1 and applies to all of Waterford Harbor. The
Oaks, often referred to as a “sub-association,” also promulgated a “Declaration for
Waterford Oaks,” separate and apart from the Master Declaration. The Oaks
Declaration is also filed of record.
Attached to the Master Declaration as Exhibit “B” is the “Waterford Harbor
Pro-Rata Share of Reserves.”2 It sets out the total square feet of each Reserve, and
the percentage each Reserve represents, as compared to the total square footage of
1
The Master Declaration was to continue through December 31, 2005, and could be
extended for one or more periods of ten additional years if approved by a two-thirds vote.
2
The Master Declaration defines a “Reserve” as “(i) any portion of the Property
identified by reserve and block number, reserve letter or similar designation on any recorded Plat
of the Property or portion of it, and (ii) each other portion of land contained within the Property
which shall be designated as a “Reserve” for the purposes of this Declaration in any amended or
supplementary declaration or deed hereafter executed by Declarant.”
2
the subdivision. Exhibit “B” lists the Oaks, designated as Reserve G, as containing
394,254 square feet. The Plat for Waterford Harbor identifies the square footage
as 594,254, as does the Declaration specific to the Oaks. The total square footage
of the Oaks is part of the calculation for determining the amount of the annual
assessment for expenses charged to the particular reserve and how that amount of
expenses is charged to each lot owner in Waterford Oaks. Specifically, in the
Master Declaration, “Pro Rata Share” is defined to mean:
(i) each Reserve, the percentage allocated to each Reserve on Exhibit
“B” to this Declaration, and (ii) each Owner of a Lot . . ., a fraction,
the numerator of which is the number of Net Square Feet in the Lot(s)
owned by the Owner in question and the denominator of which is the
number of Net Square Feet in the Reserve, excluding all Common
Facilities. . . .”
Thus, “Pro Rata Share” is used for two purposes. The first is to calculate the
percentage of the Master Association expenses for which each Reserve is
responsible; that is, for what percentage of Master Association expenses the Oaks
section is responsible. The second is to calculate the amount of the total figure
assessed for each Reserve for which each lot owner in that reserve is responsible.3
The “Pro Rata Share” calculation does not bear on voting.
The Landolts learned of a change to the Oaks square footage figures in 2002.
The minutes of Waterford’s board of directors reveal that in December 2002, the
square footage of the Oaks was changed from the 394,254, as shown on Exhibit
“B”, to 594,254, as reflected on the Plat of the subdivision and in the sub-
association Declaration. Beginning in 2003, Waterford calculated assessments
using the 594,294 square feet figure. The Landolts claim their assessment
3
While there are two assessments on the Landolts’ property; one for the Master
Association, and a separate one for the Oaks sub-association, only the Master Association
assessment is at issue.
3
increased 7-8%. Since that time, the Landolts have paid their assessments “under
protest.”
In May 2012, Waterford’s Master Association called for a vote on three
amendments. The first was to amend the Master Declaration to approve the 2002-
2003 change to the total square footage of the Oaks. The second was to allow sub-
associations (such as the Oaks) to submit petitions to elect their own boards of
directors. The third was to increase approval by membership required to amend
the Master Declaration from 51% to 67% for purposes of the Pro Rata Share or
termination of the covenants. The minutes of Waterford’s board of directors
meeting in June 2012, show Amendment 1 passed with 52.93%, Amendment 2
received 50.98% approval, and Amendment 3 had 50.40%. Because 51% is
required to amend the Master Declaration, only Amendment 1 was approved.
In June 2012, the Landolts received a letter asking homeowners to verify the
square footage of the owners’ lot, explaining the figures used were taken from the
records of the Galveston County Appraisal District (“GCAD”). The letter listed
the square footage of the Landolts’ property as 35,911. Michael Landolt testified
the property was approximately 36,200 square feet.
The Landolts sued Waterford under the Texas Declaratory Judgment Act,
seeking a declaration that the “Oaks park” be considered “Common Facilities.”
This declaration, the Landolts urged, would result in a reduction in the amount of
assessment because “Community Facilities” are exempt from inclusion in the
calculation on which assessments are based. The Landolts also asked the court to
declare that a particular section of property, Reserve A, is a common interest
property for every resident of Waterford Harbor, arguing every resident should be
allowed to vote a pro rata share of that property. They also asked the court to
require Waterford to use the square footage listed on the Plat, and not that listed in
4
the GCAD records, for voting purposes. Finally, the Landolts sought recovery of
overpayments on assessments based on the increased square footage due to the
2002-2003 change to the square footage contained in the Plat.
The trial court ordered that the 2002-2003 action of Waterford’s board of
directors changing the typographical error, correcting the square footage from
394,254 to 594,254, was invalid. The trial court further found the May 2012 vote
was invalid because the numbers used were based on the “invalid” 2002-2003
voting numbers. The trial court declared that the “Oaks park” area is not a
Common Facility and the trial court rejected that Reserve A should be allocated to
the homeowners for purposes of voting. Finally, the trial court awarded the
Landolts $16,218.24 (four years of assessments), along with attorneys’ fees, pre
and post-judgment interest.
Waterford appealed; the Landolts asserted two cross-points.
II. ANALYSIS
A. Standard of Review
We review declaratory judgments in the same manner as other judgments.
Tex. Civ. Prac. & Rem. Code Ann. § 37.010 (West 2008). We review a trial
court’s findings utilizing the same standards as a review of a jury’s verdict. See
MBM Fin. Corp. v. Woodlands Operating Co., L.P., 292 S.W.3d 660, 663 (Tex.
2009) (citing Catalina v. Blasdel, 881 S.W.2d 295, 297 (Tex. 1994)). When there
is a complete reporter’s record, the trial court’s findings are not conclusive. See
Arrellano v. State Farm Fire & Casualty Co., 191 S.W.3d 852, 856 (Tex. App.—
Houston [14th Dist.] 2006, no pet.). When there are no findings of fact and
conclusions of law, we must infer that the trial court made all findings necessary to
support its judgment, and we will uphold those findings if they are supported by
5
sufficient evidence. Chenault v. Bank, 296 S.W.3d 186, 198 (Tex. App.—Houston
[14th Dist.] 2009, no pet.) (citing Holt Atherton Indus., Inc. v. Heine, 835 S.W.2d
80, 83 (Tex. 1992)).
In a legal-sufficiency challenge, we review the record in the light most
favorable to the factual findings, crediting favorable evidence if a reasonable
factfinder could, and disregarding contrary evidence unless a reasonable factfinder
could not. See City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex. 2005). We
will conclude the evidence is legally insufficient to support a finding only if (a)
there is a complete absence of evidence of a vital fact, (b) the court is barred by
rules of law or evidence from giving weight to the only evidence offered to prove a
vital fact, (c) the evidence offered to prove a vital fact is not more than a mere
scintilla, or (d) the evidence conclusively establishes the opposite of the vital fact.
Id.
In a factual-sufficiency review, we consider and weigh all of the evidence in
a neutral light and set aside the challenged finding only if the evidence is so weak
or the finding is so against the great weight and preponderance of the evidence that
it is clearly wrong and unjust. See Dow Chem. Co. v. Francis, 46 S.W.3d 237, 242
(Tex. 2001). We will defer to a trial court’s factual findings if they are supported
by evidence. Perry Homes v. Cull, 258 S.W.3d 580, 598 (Tex. 2008).
When a question of law is at issue, such as the review of an unambiguous
restrictive covenant, our review is de novo. See Pilarcik v. Emmons, 966 S.W.2d
474, 478 (Tex. 1998); American Gold Corporation v. Colburn, 65 S.W.3d 277, 279
(Tex. App.—Houston [14th Dist.] 2001, pet. denied) (citing Ostrowski v. Ivanhoe
Property Owners Improvement Ass’n, 38 S.W.3d 248, 253 (Tex. App.—Texarkana
2001, no pet.)). Our primary goal is to ascertain and give effect to the purposes
and intent of the language of the restrictive covenant. See Wiese v. Healthlake
6
Cmty. Ass’n, 384 S.W.3d 395, 400 (Tex. App.—Houston [14th Dist.] 2012, no
pet.); see also Tex. Prop. Code Ann. § 202.003(a) (West 2013).
B. Limitations
Waterford filed a motion for summary judgment, asserting the four-year
statute of limitations barred the entirety of the Landolts’ suit because they were
aware of the change to the restrictive covenants, by way of the change in square
footage in 2002-2003; yet, they did not file suit until 2012. The trial court denied
the motion as to the entirety of the suit, but ruled the Landolts’ recovery should be
limited to four years of assessments. Liberally construing Waterford’s appellate
brief, we conclude that Waterford argues that the evidence conclusively proved
that all of the “[Landolts’] lawsuit should be barred by the four-year statute of
limitations.” See Perry v. Cohen, 272 S.W.3d 585, 587 (Tex. 2008) (liberally
construing issues presented in appellate brief based on argument section of the
brief).
Actions to enforce restrictive covenants are governed by the four-year
statute of limitations. See Storck v. Tres Lagos Property Owners Ass’n, Inc., No.
06-13-0006-CV, 2014 WL 3882817, at *11 (Tex.App.—Texarkana, Aug. 8, 2014,
no pet. h.), --- S.W.3d --- (citing Malmgren v. Inverness Frost Residents Civic
Club, Inc., 981 S.W.2d 875, 877 (Tex. App.—Houston [1st Dist.] 1988, no pet.);
Buzbee v. Castlewood Civic Club, 737 S.W.2d 366, 368 (Tex. App.—Houston
[14th Dist.] 1987, no writ).
The Landolts filed suit after the May 2012 vote to make official the change
to the square footage set forth in the Master Declaration. The judgment limited the
Landolts’ recovery to four years, due to the four-year statute of limitations. We
hold Waterford did not conclusively prove that limitations barred the entirety of
the Landolts’ claim. Therefore, we overrule Waterford’s first issue.
7
C. Square footage correction
Next, Waterford contends the trial court erred by (1) determining that the
2002-2003 vote to correct the square footage of Reserve G, the Oaks section in
which the Landolts live, was invalid, (2) finding the May 2012 vote was invalid,
and (3) awarding damages and attorneys’ fees to the Landolts.
1. Board action in 2002-2003
The Landolts’ suit urged the 2002-2003 change violated Section 2.5 of the
Master Declaration, which provides: “If additional Property is hereafter made
subject to or removed from the provisions of this Declaration . . . the Pro Rata
Share of an Owner . . . of a Reserve or Lot . . . shall not be increased as a result of
the addition of Property without the written consent of that Owner . . . .”
Waterford argued no property was added to the subdivision, and there is no
evidence that property was added; therefore, Section 2.5 is inapplicable.
Waterford also argued the board’s action to correct a typographical error is
consistent with the specific language of the Master Declaration and a construction
of the entire document. Waterford points out the Plat for Waterford Harbor,
incorporated in the Master Declaration, identifies the square footage of Reserve G
as 594,254, as does the Declaration specific to the Oaks section. Only Exhibit B
attached to the Master Declaration contained the typographical error of 394,254
square feet. There is no evidence the 394,254 figure was accurate, and there is no
evidence to contradict the 594,254 figure set forth on the Plat attached to the
Master Declaration and on the Oaks Declaration. Further, both parties agreed the
Declarations were unambiguous and that they were bound by their terms.
Construing the Master Declaration, and the attached Plat, as well as the Oaks
Declaration, it appears the 394,254 square feet figure listed on Exhibit “B” was a
8
typographical error and the intent of the parties was that the figure to be used for
calculation of the assessment was 594,254, not 394,254, square feet.
“Typographical errors ‘must yield to the well-established doctrine that written
contracts will be construed according to the intention of the parties,
notwithstanding errors and omissions, by perusing the entire document and to this
end, words, names, and phrases obviously intended may be supplied.’” Edberg v.
The Laurel Canyon Ranch Architectural Review Committee, No. 04-10-00395-CV,
2011 WL 541134, at *4 (Tex. App.—San Antonio Feb. 16, 2011, pet. denied)
(mem. op.) (citing Ussery Invs. v. Canon & Carpenter, Inc., 663 S.W.2d 591, 593
(Tex. App.—Houston [1st Dist.] 1983, writ dism’d)) (holding where there were
eight references to “Unit 2” and two to “Unit 1,” the references to “Unit 1” were
typographical errors, which may be corrected); see also Pilarcik, 966 S.W.2d at
478 (concluding covenant is examined in light of the circumstances when written).
Additionally, the Landolts included in their original petition that the Plat
records referred to the 594,254 figure, and the Landolts urged with respect to the
footage shown for their lot in July 2012, the Plat figures should have been used,
rather than those set out in the GCAD records. That the Landolts asserted the
square footage figures contained in the Plat records should have been used is
consistent with the parties’ intent, as reflected in the documents, that the Plat and
its 594,254 square foot figure would control.
We hold the 2002-2003 action was proper, and we sustain Waterford’s
second issue.
2. May 2012 vote
The election results reflected Amendment 1 passed with 55.43% approval.
The Landolts contend the May 2012 vote, amending the Master Declaration to
reflect 594,254 square feet, was invalid for three reasons: (1) they did not vote
9
because they were out of town; (2) Reserve A was not voted;4 and (3) incorrect
footage was voted. Waterford argue the change in the total square footage for
Reserve G bears only on the calculation of assessments and does not affect voting
rights, and that the use of GCAD figures for individual lots does not invalidate the
2012 voting.
Voting is governed by Section 3.2 of the Master Declaration and provides
for two classes of voting members:
(a) Class A Members shall be all Members, provided that Declarant
shall not be a Class A Member until it ceases to be a Class B Member
as provided in Section 3.2(b). Except as otherwise provided on
Exhibit “B” to this Declaration or as reallocated as provided in the
definition of Pro Rata Share or under Section 2.5, each Class A
Member shall be entitled to one vote for each Net Square Foot of land
contained in the Reserve or Lot owned by that Member.
Reallocation is contemplated within the definition of Pro Rata Share. It provides
that “the Board may delegate to the Subassociation or Owner(s) of any Reserve or
Lot the right to allocate the Pro Rata Share among the Owners within that Reserve
or Lot as they determine . . . .” Reallocation under Section 2.5 occurs, as set forth
above, only if property is added to the subdivision; there was no addition here.
Thus, neither of these provisions is applicable, as there was no allocation within
the sub-association, and there was no addition of property.
Michael Landolt testified the May 2012 vote on Amendment 1 did not
obtain the requisite percentage approval and that there was never a vote as to their
Pro Rata Share. The Landolts rely on Section 11.2 as support:
Declarant acting alone shall have the right to record any amendment
required to correct any grammatical, typographical or mathematical
error in this Declaration. . . . Notwithstanding the foregoing
4
This point is addressed in the discussion of the Landolts’ second cross-point.
10
provisions, however, any amendment or modification to this
Declaration or any supplemental declarations which (i) amends article
Three [Voting] or Article Eight [Development and Land Use] of this
Declaration or increases the Pro Rata Share of any Owner for the
payment of Assessments shall require the vote of a majority of the
total eligible votes of each Class of Members of the Association. . . .
(Emphasis added).
Michael Landolt testified the Declarant “acting alone” had the right to
correct a typographical error. He also answered “no” when counsel for appellant
asked, “It [Master Declaration] doesn’t say only the Declarant may correct
typographical errors, does it?”
The Landolts further assert that the Reserve A property which was deeded
by Declarant to settle the class-action lawsuit should have been voted.5 This
argument ignores the unambiguous language of Section 3.2, which provides that
each Class A Member shall be entitled to one vote for each Net Square Foot of
land “owned by that Member.” Reserve A was never owned by any Member; the
terms of the settlement agreement, which Michael Landolt testified they signed,
evidence the fact it was deeded to the Master Association.
Finally, the Landolts argue the square footage numbers were inaccurate;
specifically, they believed their lot was 36,200 square feet, but the GCAD numbers
on which the Landolts were appraised and taxed, showed 35,911. The Landolts
argued the discrepancy reduced the number of their votes. In an attempt to obtain
an accurate figure, they engaged Dale Hardy, a surveyor who had done work in
Waterford Harbor on prior occasions, to review the original plat and to determine
accurate square footage values for every lot in the subdivision. While Hardy did
not physically perform a survey of the property, he found various differences in the
square footage of certain areas contained within Waterford Harbor.
5
Further analysis relating to Reserve A is included in Section E, infra.
11
The trial court’s judgment did not address the issue involving the square
footage of the individual lot. Rather, it invalidated the May 2012 vote on the basis
of its ruling the 2002-2003 correction was improper. Yet, the May 2012 vote was
determined by the votes of the “Net Square Foot” of land under Section 3.2—not
the number of square feet in the entire Reserve where the Landolts live, which is
used to calculate homeowner assessments. The correction to the square footage of
the entire Reserve had no bearing on, and changed nothing concerning the voting
of, individual lot owners.
Further, even if the Net Square Foot figure were involved in the May 2012
vote, the Master Declaration does not identify the amount of square footage in each
individual lot, nor does it specify which number (GCAD or some other) should be
used for assessing the homeowner’s vote pursuant to Section 3.2. Thus, it would
be reasonable to conclude that Waterford could use GCAD figures.
In construing the Declaration, our primary concern is to ascertain and give
effect to the intentions of the parties as expressed in the document. See Kelley-
Coppedge, Inc. v. Highlands Ins. Co., 980 S.W.2d 462, 464 (Tex. 1998). To
ascertain the parties’ true intentions, we examine the entire agreement in an effort
to harmonize and give effect to all provisions so that none will be rendered
meaningless. See MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647,
652 (Tex. 1999). Whether a Declaration is ambiguous is a question of law for the
court. Heritage Res., Inc. v. NationsBank, 939 S.W.2d 118, 121 (Tex. 1996). It is
ambiguous when its meaning is uncertain and doubtful or is reasonably susceptible
to more than one interpretation. See id. However, when a Declaration is worded
so that it can be given a certain or definite legal meaning or interpretation, it is
unambiguous, and the court construes it as a matter of law. See Am. Mfrs. Mut.
Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex. 2003). We cannot rewrite the
12
Declaration or add to its language under the guise of interpretation. See American
Mfrs. Mut. Ins. Co., 124 S.W.3d at 162. Rather, we must enforce it as written. See
Royal Indem. Co. v. Marshall, 388 S.W.2d 176, 181 (Tex. 1965).
The Landolts’ position confuses the unambiguous provisions of the Master
Declaration. The 2002-2003 change had no bearing on the outcome of the May
2012 vote. Additionally, the Landolts did not vote in that election and offered no
evidence to show how, if at all, the difference between the 36,200 square feet
Michael Landolt testified they owned and the 39,500 referenced in GCAD records
would have impacted the vote to amend the Master Declaration to reflect the
594,254 square footage figure for Reserve G.
We conclude the trial court erred in its finding that the May 2012 vote was
invalid due to the correction of the typographical error in 2002-2003, and we
sustain Waterford’s third issue. Because we hold the 2002-2003 change and May
2012 vote were valid, we sustain Waterford’s fourth issue on Landolts’ recovery of
monetary damages and attorneys’ fees.
D. Characterization of the “Oaks park”
In their first cross-point, the Landolts contend the trial court erred in finding
“Oaks park,” located in the Oaks section of Waterford Harbor, was properly
declared as a park. The Landolts assert the park should be considered part of the
“Common Facilities” of Waterford Harbor, and thus, exempted from assessment.
We disagree.
Article One of the Master Declaration, applicable to all of Waterford Harbor,
defines “Common Facilities” as:
(i) any and all portions of the Property designated on the Plat as
private streets, (ii) all Bulkhead, and (iii) such other areas of the
property or other property shown on the Plat as Common Facilities . . .
13
. The Common Facilities are to be held, maintained and operated for
the common use and benefit of the Owners.” Nowhere in this section
is a park contemplated as part of the “Common Facilities.
The Landolts rely on the language in the Oaks Declaration; that is, the
Declaration of the more private, upscale area within Waterford Harbor where the
Landolts live. The Oaks Declaration in Section 1.06, “Community Area” is
defined as:
Those portions of Waterford Oaks specifically designated in the
Subdivision Plat as Restricted Reserves A, B, and C, Common Area,
or similar designation, the private streets in Waterford Oaks . . . The
Community Area may include, without limitation, piers, docks, and
other improvements or other facility constructed by the Association or
by the Declarant. . . .
First, there is no evidence that Waterford Harbor Master Association owns
the Oaks park area. Rather, Waterford Harbor Oaks Homeowners Association, a
“sub-association,” has been, and remains, the owner of Reserves A, B, and C, as
evidenced on the 1992 warranty deed from the Declarant [Developer] to the
association. Second, the terms “Common Facilities” and “Common Area” are not
interchangeable and both derive from different declarations. In any event, both
declarations exempt from assessment all “Common Facilities” and “Common
Area.” Additionally, both declarations provide that voting is based on ownership
of the individual lot in the subdivisions, pursuant to Section 3.2 of the Master
Declaration.
Article Four of the Master Declaration, Section 4.2 provides that
assessments shall be made annually and “shall be used for the purpose of
promoting the enjoyment and welfare of the Owners and for the maintenance and
improvement of the Common Facilities and other portions of the Property . . . .”
Section 4.4 provides “Each Owner shall pay its Pro Rata Share of the Association’s
annual Regular Assessment . . . .” Section 4.11 exempts from the Assessments the
14
Common Facilities and all portions of the Property dedicated. Further, the
definition of “Pro Rata Share” in the Master Declaration, referred to above,
specifically provides the denominator of the fraction to determine an owner’s share
“. . . is the number of Net Square Feet in the Reserve, excluding all Common
Facilities.”
The Landolts assert here that because the Oaks park is a “Common Area”
under the Oaks Declaration, applicable to the Oaks sub-association, and is exempt
from assessment under that declaration,6 it also must be considered “common
facilities” and be exempt from the Pro Rata Share for assessment under the Master
Declaration at issue. There is no evidence to support the Landolts’ contention.
There is nothing ambiguous about the language of these restrictive
covenants, and the Landolts do not argue the terms are ambiguous. When
construing a restrictive covenant, our primary goal is to ascertain and give effect to
the intent of its drafters, using the language of the instrument as our guide. Wiese,
384 S.W.3d at 400 (citing Uptegraph v. Sandalwood Civic Club, 312 S.W.3d 918,
925 (Tex. App.—Houston [1st Dist.] 2010, no pet.) We will afford words and
phrases their commonly accepted meanings. Id.
Here it is clear the Master Declaration excluded for purposes of calculating
the Pro Rata Share only the “Common Facilities” located in Waterford Harbor.
The Master Declaration uses only the phrase “Common Facilities” and never refers
to “Common Area,” as does the Oaks Declaration. Further, Article Ten of the
Master Declaration, containing seven sections, deals with “Common Facilities and
Easements.” It speaks to numerous issues including the use of and title to
Common Facilities, restrictions on conveyance, obtaining easements across the
6
Section 7.08 of the Oaks Declaration exempts “Common Area” from calculation of
assessments.
15
Common Facilities, borrowing money to improve or mortgage all or part of the
Common Facilities, and parking and access to the Common Facilities. None of the
provisions refers to the “Community Area” defined in the Oaks Declaration.
The parties’ intent is expressed in the words used, and the words omitted,
from each declaration. That the Master Declaration did not include the “Oaks
park” as “Common Facilities,” which would exempt it from the calculation of the
Pro Rata Share under the Master Declaration, evidences the intent that the park be
included for purposes of calculating assessments under the Master Declaration.
Similarly, that the Oaks Declaration does not refer to “Common Facilities,” as it
deals with matters of voting and assessments, evidences that the parties intended
that Common Area requires different treatment. In short, had the drafters of both
the Master Declaration and the Oaks Declaration intended that “Common
Facilities” and “Common Area” include the same property, the terms used would
have been the same. Because different terms were used, neither of which is
ambiguous, all must be construed in light of the entire agreement. Moran v.
Memorial Point Property Owners Association, 410 S.W.3d 397, 402 (Tex. App.—
Houston [14th Dist.] 2013, no pet.). Therefore, we conclude different meanings
were intended by the use of different words. Thus, we affirm the trial court’s
conclusion that the “Oaks park” should be included for purposes of assessment
under the Master Declaration and we overrule the Landolts’ first cross-point.
E. Reserve A
In 2001-2002, certain homeowners, including the Landolts, filed a class-
action suit asserting claims against the Declarant [developer] for improper or
excess assessment of homeowner fees. To settle that suit, the Declarant paid the
16
homeowners $375,000 and deeded Reserve A7 to the Master Association. Prior to
the time it was deeded, the Declarant was voting Reserve A. Once Reserve A was
deeded to the Master Association, the Landolts contended it could be included for
purposes of voting; however, it was not. The trial court held Reserve A should not
have been allocated to all owners for purposes of voting. We agree.
The Master Declaration, Article Three, Section 3.2 limits voting to “one vote
for each Net Square Foot of land contained in the Reserve or Lot owned by that
member.” (Emphasis added). The language of this provision is clear and
unambiguous. Reserve A was deeded to the Waterford Harbor Master Association,
a Texas corporation. Neither the Landolts nor any other resident owns, or has an
ownership interest in, any part of Reserve A; therefore, it cannot be included for
purposes of voting. The words of Section 3.2 relating to voting “can be given a
definite or certain legal meaning,” and they must be construed to give them their
purposes and intent. See American Golf Corp., 65 S.W.3d 277 at 280. The words
require that ownership of property is a prerequisite to voting. Therefore, because
the Landolts do not own Reserve A, they cannot vote all or part of the square
footage reflected in it. There is no evidence to support the Landolts’ position, and
they offer no authority to support the proposition that the trial court erred. We
overrule the Landolts’ second cross-point.
III. CONCLUSION
Because we conclude that the change in 2002-2003 was to correct a
typographical error, and the May 2012 vote was premised on a different basis, we
reverse the trial court’s judgment insofar as it provides that the 2002-2003 change
7
Reserve A is a portion of the subdivision which originally had been zoned as “light
commercial,” but was not shown in that manner on the Plat. Michael Landolt testified the
owners would not accept the “light commercial” zoning; therefore, the Declarant deeded it to the
Master Association to be used for residential purposes.
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and the May 2012 vote was invalid. Therefore, we reverse and render the award of
monetary damages and attorneys’ fees in favor of the Landolts. We affirm the trial
court’s judgment declaring the “Oaks park” area is not a “Common Facility,” and
rejecting the argument that Reserve A was to be allocated for voting. We render
judgment that Waterford recover attorneys’ fees in the amount of $33,263.50, plus
an additional $15,000.00 for a successful appeal to the court of appeals, and
$15,000.00 for a successful appeal to the Supreme Court of Texas.
/s/ John Donovan
Justice
Panel consists of Chief Justice Frost and Justices Donovan and Brown.
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