2018 Mass. App. Div. 54

November 3, 2017 - March 20, 2018

Appellate Division Southern District

Court Below: District Court, Orleans Division

Present: Hand, P.J., Welch & Kirkman, JJ.

Edward T. Patten for the plaintiff.

E. James Veara and Paul V. Benatti for the defendant.

KIRKMAN, J. Meadowview Heights Homeowners Association, Inc. ("Association") is the plaintiff in an action in the Orleans District Court to establish and enforce a lien for unpaid annual assessments of $350.00 from the defendant-homeowner, Mabel A. Chosse ("Chosse"). The annual common assessments sought from the defendant include maintenance of private roads in a residential development in Provincetown, Massachusetts. The development contains seventy homes on separate lots that abut and share the private roads within the subdivision. After twenty-one years of payments, the defendant stopped paying the annual assessments in 2009. The total lien amount sought in the District Court, which includes late fees, finance charges, attorney's fees, and costs, is $23,350.39.

The Association appeals from the allowance of a motion for summary judgment for the defendant. In so ruling, the trial court essentially found that the right of the Association to collect any assessments expired on January 19, 2009, thereby relieving the defendant of any obligation to pay sums allegedly due after that date. For our purposes, the facts are not in dispute, and a decision can be reached based on the

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materials forming the record on appeal. Cassesso v. Commissioner of Correction, 390 Mass. 419, 422 (1983).

On October 18, 1983, Matthew J. Costa, the developer of Meadowview Heights, a residential development in Provincetown, Massachusetts, signed a "Declaration of Protective Covenants for Meadowview Heights in Provincetown" ("Declaration"). The Declaration was registered in the Land Court office of the Barnstable County registry of deeds on January 19, 1984.

The Declaration imposed a number of restrictions on the building, maintenance, and use of private single-family homes. The developer retained a fee in roads servicing the development until conveyance to the Association. [Note 1] The parties agree that the developer never "assigned, conveyed, or transferred his enforcement rights or his roadway ownership" to the Association.

The Association was created by the Declaration, which required each lot owner to be a member of the Association subject to the Association's "bylaws, rules and regulations" and "dues, assessments or charges" established by it. [Note 2] By its own terms,

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the covenants were to expire on January 19, 2009. [Note 3] Enforcement of the covenants was retained by the developer. [Note 4]

On March 2, 1987, the developer, as Trustee of the Meadowview Heights Trust, conveyed a lot to the defendant subject to the provisions of the Declaration described above. A transfer certificate of title was recorded approximately six weeks later.

The Association filed articles of organization with the Secretary of the Commonwealth on December 7, 1998. The purpose of the Association is to promote the beneficial use of the property and its appurtenances, including the maintenance of common roads in accordance with duties delegated to it by the Declaration. [Note 5]

The Association registered bylaws on April 5, 1999. Section 1.1 of the bylaws declares that each lot owner is a member of the Association "subject to that certain Declaration of Protective Covenants for Meadowview Heights in Provincetown dated October 18, 1983, and recorded with the Barnstable County Land Registration District [citing the correct document numbers]." Section 3.2 of the bylaws sets out the rights and duties of the Association's directors with regard to maintenance, repair, and upkeep of the property. Section 3.5 sets out the process the directors are to follow in determining and imposing common assessments as well as the payment obligation by the homeowners. There have been no material amendments to either the articles of organization or the bylaws.

It is undisputed that Chosse paid all assessments due from the date she purchased her lot until January 19, 2009. She successfully argued to the trial court judge that there is no money due after that date because the Declaration creating the assessments expired in 2009. The Association argues that by its creation (which is referred to in the original Declaration) and associated corporate bylaws, it has the right to make and collect the assessments at issue. It argues the law imposes an obligation on the homeowners to pay the assessments, by an implied contract or equitable servitude, under the circumstances of this case. The Association bases its argument on the holding of Sullivan v. O'Connor, 81 Mass. App. Ct. 200 (2012), which develops the law regarding common scheme developments and attendant equitable servitudes.

In Sullivan, the plaintiffs owned property in a development created in 1929. As part of the development, an unincorporated improvement association was created, by way of a declaration of trust recorded in the registry, to hold title to common property and provide and maintain amenities such as playgrounds, parks, and roads. Owners

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in the development were required to pay assessments. Later, restrictions were recorded on the lots. The Sullivans bought their property in 1977 with knowledge of the association and the restrictions, and for a while paid their assessments before changing their mind and refusing to pay. The court held that while the restrictions had expired pursuant to G.L. c. 184, ยง 28, [Note 6] the obligation to pay assessments was an equitable servitude that ran with the Sullivans' property and constituted a continuing obligation. Id. at 202-204, 213.

"While Massachusetts follows the general rule that land 'is free of encumbrances that are not noted on the certificate of title' or in the chain of title, there exist two exceptions to that general rule: '(1) an encumbrance may bind an owner if what the certificate of title recites in the way of prior documents, plans, restrictions, rights, and reservations would prompt a reasonable purchaser to investigate further the referenced documents, or (2) the purchaser has actual knowledge of the encumbrance.' Where a grantee takes title to land without either express mention of restrictions on said land in the grantee's deed or knowledge of such restrictions, the grantee still may be bound by said restrictions" (citations omitted). Id. at 205-206.

Here, the lot owner's chain of title shows that upon the original development and Chosse's subsequent purchase, she was a member of the Association. Compare Popponesset Beach Ass'n, Inc. v. Marchillo, 39 Mass. App. Ct. 586 (1996) (nothing in lot owners' certificates of title or other registered documents put them on notice that they were members of property owners association or subject to collection of assessments by association).

But Chosse argues that based on Paragraph 27 of the original Declaration, any assessment may be collected only for twenty-five years because of a termination clause regarding covenants and restrictions. See note 3, supra. Moreover, she asserts that because the developer never transferred his interest in the roads or his right to enforce road maintenance assessments to the Association, she is not obligated to pay beyond the stated twenty-five year period.

Nevertheless, the assessments that were collected and imposed are not "covenants or restrictions" subject to the termination clause. Rather, the assessments constitute an implied obligation to share in the common property benefit of properly maintained roads. Sullivan, supra at 208-210, and cases cited. That obligation arises as both an equitable servitude and as an implied contract.

Regardless of whether the developer transferred his interest in the roads or his right to enforce the collection of assessments, he clearly intended by the Declaration to establish a mechanism, through the Association as part of a common development

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scheme, to create an implied servitude. Id. See Houghton v. Rizzo, 361 Mass. 635, 640-642 (1972), for a discussion of the imposition of implied servitudes arising from a common development scheme. And the developer's intention was clearly contained in the chain of title here, rather than asserted against a later, unknowing buyer.

The developer's intention to establish the ongoing maintenance of roads shared in common by the lot owners was met by the present defendant with twenty-two years of payments to the plaintiff. [Note 7] Thus, a contract under the terms of the original Declaration and subsequent record documents establishes an implied contract between the parties. Sullivan, supra at 212.

The judgment of the trial court is reversed, and the matter is returned to establish the amount of the lien that is sought.


[Note 1] Paragraph 2 of the Declaration states:

"Roads The Developer shall retain the fee in the ways shown on the plans set forth in Exhibit 'A' and shall maintain the same including the catch basins until such time as the fee is conveyed to the Homeowners' Association provided for in Paragraph 17 hereof. The Developer may convey the fee in the ways to the Association in his sole discretion, but in no event shall he do so prior to December 31, 1985. Appurtenant to each lot shall be the right to use the roads, lanes, avenues and ways as shown on the plans."

[Note 2] Paragraph 17 of the Declaration states:

"Homeowners' Association There is hereby created an association of the owners of all lots within Meadowview Heights known as Meadowview Heights Homeowners' Association, hereinafter called 'the Association.' The Developer, for each lot owned by him, and the owner of any lot by the acceptance of a deed therefor, whether or not it shall be so expressed in the deed, hereby covenant and agree to be a member of the Association, to pay to the Association any dues, assessments or charges established by it, and to adhere to the bylaws, rules and regulations adopted by it from time to time. The Developer, in his discretion, may convey his powers of approval and consent set forth herein as well as the fee in the ways to the Association in which event the Association shall accept the same."

[Note 3] Paragraph 27 of the Declaration states:

"Duration The covenants and restrictions of this Declaration shall run with and bind the property and shall inure to the benefit of the Developer, the Association and the owners of the lots subject to this Declaration, their heirs, successors, legal representatives and assigns for a term of twenty-five (25) years from the date of recording of this Declaration."

[Note 4] Paragraph 30 of the Declaration states:

"Enforcement Enforcement of these covenants shall be by the Developer by any proceeding at law or in equity against any person violating or attempting to violate any provisions of this Declaration."

[Note 5] Article II allows the Association "to own, hold, acquire, build, divest, operate and maintain facilities, including, but not necessarily limited to streets, footways and paths, and things appurtenant thereto, and to improve streets . . .; [and] do those things meet and proper to that which is delegated to it by and under a certain Declaration of Protective Covenants for Meadowview Heights . . . dated October 18, 1983, and recorded with Barnstable County Land Registration District [citing the relevant document numbers]."

[Note 6] Section 28 of Chapter 184 of the General Laws, which does not apply in this case, provides, in part:

"No restriction imposed before January first, nineteen hundred and sixty-two shall be enforceable after the expiration of fifty years from its imposition unless a notice of restriction is recorded before the expiration of such fifty years or before January first, nineteen hundred and sixty-four, whichever is later, and in case of such recording, twenty years have not expired after the recording of any notice of restriction without the recording of a further notice of restriction."

[Note 7] As suggested by the defendant at the oral argument of this case, the developer may have thought that the town of Provincetown would have accepted the roads in the development by 2009, thus relieving the homeowners from paying related assessments. Unfortunately, that has not happened.