NEW FALMOUTH WOODS, LLC v. BALLYMEADE PROPERTY OWNERS ASSOCIATION, INC., et al. BALLYMEADE PROPERTY OWNERS ASSOCIATION, INC. v. NEW FALMOUTH WOODS, LLC

INTRODUCTION

The central questions presented in the parties’ cross motions for summary judgment are whether a certain provision contained in a declaration of covenants, easements and restrictions made by the owner of a residential subdivision, created an enforceable restriction on the Plaintiff’s abutting land and, if so, whether such restriction remains enforceable by the Defendants. The Plaintiff/Defendant in Counterclaim, New Falmouth Woods, LLC (“the Plaintiff” or “New Falmouth”), has moved for summary judgment under Count I of its Second Amended Complaint that the use of certain land it owns in Falmouth, Massachusetts is not restricted to “country club purposes” by virtue of a provision contained in a declaration of covenants, easements and restrictions made by the owner of an abutting residential subdivision. [Note 1] New Falmouth contends that its land is not subject to the purported restriction because: (1) the declarant never owned Plaintiff’s land; (2) the declarant held no deeded rights to impose a use restriction on Plaintiff’s land at the time of the declaration; and (3) the declarant never recorded a use restriction during the time it held a leasehold interest in Plaintiff’s land. The Plaintiff further contends that, even if the declaration’s country club provision is deemed to have imposed a restriction when the declarant later acquired a leasehold interest in Plaintiff’s land, such a restriction would have terminated with the leasehold estate in 1990 as a result of a mortgage foreclosure on the leasehold. Alternatively, New Falmouth argues that any rights to enforce the claimed restriction were relinquished when an amended and restated declaration was subsequently recorded in 1995, without including the country club provision.

The Defendant/Plaintiff in Counterclaim, Ballymeade Property Owners Association, Inc. (“Ballymeade Association”), representing itself and all the lot owners in the residential subdivision which abuts the Plaintiff’s land, [Note 2] has cross-moved for summary judgment that there is a binding and enforceable restriction on the Plaintiff’s land, permanently limiting the use of that land to country club purposes, and that such restriction was neither extinguished by foreclosure, nor released by the 1995 restatement and amendment of the declaration.

The Ballymeade Association’s argument is based on two alternative theories. First, it argues that the recording of the declaration containing the country club provision was sufficient, in and of itself, to create an enforceable use restriction on the Plaintiff’s land, because the beneficiaries of the record owner trust knew of, and consented to, the imposition of the restriction for the benefit of the residential subdivision. Alternatively, the Ballymeade Association asks the court to effectuate the intentions of the parties at the time the declaration was made and recorded, by determining, as a matter of equity, that the country club provision in the declaration imposed a servitude on Plaintiff’s land, which remains enforceable against the Plaintiff as a buyer with both record notice and actual notice of the restriction set forth in the declaration.

The Defendant Fairway Pointe Trustees, representing the Fairway Pointe Condominium Trust and the Fairway Pointe Condominium unit owners (“The Fairway Pointe Defendants”), also claiming to be benefited by the purported country club restriction, originally joined in the Ballymeade Association’s Cross Motion for Summary Judgment. But at the March 30, 2011 hearing on the parties’ cross-motions, the Fairway Pointe Defendants argued for the first time that the 1996 deeds into the Fairway Pointe developer support the existence of an equitable servitude. At the request of the Plaintiff, the court ordered the Fairway Pointe Defendants to file a supplemental brief addressing only this late-raised issue, and allowed the Plaintiff time to file a written response. The Fairway Pointe Defendants filed a supplemental brief on May 2, 2011. [Note 3] The Plaintiff filed its reply on May 17, 2011. Thereafter, the parties’ cross-motions for summary judgment were taken under advisement.

“Summary Judgment is appropriate where there is no genuine issue of material fact, and where viewing the evidence in the light most favorable to the non-moving party, the moving party is entitled to judgment as a matter of law.” Opara v. Mass. Mut. Life Ins. Co., 441 Mass. 539 , 544 (2004). Whether a fact is “material” depends upon whether, under applicable law, the fact might affect the outcome of the litigation. See Hogan v. Riemer, 35 Mass. App. Ct. 360 , 364 (1993) and cases cited therein. Based upon the pleadings and the admissible materials appended to the parties’ respective summary judgment motions and responses, I find that there are sufficient undisputed material facts to demonstrate, as a mater of law, that Plaintiff’s land is not burdened by an enforceable restriction limiting the use to “country club purposes.” Plaintiff is therefore entitled to summary judgment under Count I of its Second Amended Complaint. Plaintiff is likewise entitled to summary judgment in its favor on the Defendants’ [Note 4] Cross Motions, pursuant to Mass. R. Civ. P. 56(c). [Note 5]

UNDISPUTED MATERIAL FACTS

In 1986, Bruce C. Ramsey (“Ramsey”), as Trustee of Longshank Nominee Trust (“Longshank”) obtained approval from the Falmouth Planning Board for two subdivision plans covering two adjoining tracts of Longshank land. One of the subdivision plans covers a 507 ± acre tract and is titled: “Modified Subdivision Plan of Land formerly of North Landers Corporation now as Longshank Nominee Trust in Falmouth, Hatchville, MA.,” dated October 3, 1985 and showing 245 building lots and several parcels (the “Subdivision Plan”). The Subdivision Plan is recorded in Barnstable County Registry of Deeds in Plan Book 414, at Pages 75-85. The second of the approved plans covers a 297.6 ± acre tract, directly north of the Subdivision Plan tract, and is titled: “Subdivision Plan of Land of Longshank Nominee Trust in Hatchville Falmouth, Mass.,” dated July 25, 1985, latest revision January 22, 1986, showing four building lots (Lot Nos. 9, 10, 11 and 261) and three parcels (Parcel Nos. 12, 13, and 262) (the “North Plan”). The North Plan is recorded in Plan Book 414, at Pages 72-74.

The Falmouth Planning Board’s single Definitive Plan Decision recites that the Board’s vote to approve the two Plans, under one motion and with the same conditions, was based on a finding that the two Plans “are inextricably connected through their roadway system and supporting utilities, and have been submitted and proposed for development by the same Trust, and were superficially separated in application because of the need to resolve a previous court ordered agreement.” [Note 6] However, there is nothing in the Definitive Plan Decision requiring the two subdivisions to be constructed and used as a single development. And there are no notations on either of the approved Plans indicating that the two subdivisions would be developed together. There is also no mention in the Decision, and no notation on either of the Plans, relative to a proposed country club development, or a country club use restriction, on any of the North Plan lots.

By deed recorded on December 30, 1986 at Book 5491, Page 322, Ramsey, as Trustee of Longshank, conveyed two parcels of land to Falmouth Woods Development Corporation (“FWDC”). [Note 7] One parcel consisted of all the land shown on the Subdivision Plan. The second parcel consisted of the fee interest in a variable width, private way shown on the North Plan. The deed to FWDC did not purport to convey the fee interest in, or appurtenant rights in, any of the lots or parcels shown on the North Plan.

On May 13, 1987, FWDC recorded an instrument entitled “Falmouth Woods Declaration of Covenants, Easements, and Restrictions” at Book 5719, Page 262 (the “1987 Declaration”), setting forth certain covenants and restrictions pertaining to use and development of the “Land” shown on the “Subdivision Plan.” [Note 8] The 1987 Declaration was executed on behalf of FWDC as Declarant, and joined in by the Falmouth Woods Community Association, Inc. (the “Community Association”). [Note 9]

The 1987 Declaration contains an express intention that its provisions apply to the Land. None of the North Plan lots are included in the Declaration’s definition of “Land,” and it is undisputed that neither FWDC nor the Community Association held any interest in any of the North Plan lots when the Declaration was executed and recorded. Notwithstanding, Section 3.1(b) of the 1987 Declaration: (1) states that the Community Association Property shall consist of the “Roadways,” “Open Space,” and the “Country Club Area, ” and (2) defines “Country Club Area” in Section 3.1(b) (iii) to mean: Lot 11 on the North Plan and that portion of Lot 9 on the North Plan described or to be described in a long term lease (the “Recreational Lease”) to the Community Association. The “Country Club Area” shall be used only for “Country Club Purposes.” [Note 10]

The last paragraph of Section 3.1(b) (iii) in the 1987 Declaration then provides that:

Use of the Country Club Area shall be subject to reasonable regulation by the Falmouth Woods Club so long as the Recreational Lease and such regulation shall include the power to limit use of such land and facilities to members in good standing of said club and their authorized guests, invitees, and licensees…. [Note 11]

There is no indication in the Summary Judgment record that the Community Association ever negotiated, or entered into, the long-term “Recreational Lease” referenced in Section 3.1(b) (iii). Moreover, the Longshank Trustee — the then-record owner of all of the lots shown on the North Plan, including Lot 11 and Lot 9 — was not a signatory to the 1987 Declaration.

Several months after recording the 1987 Declaration, and while FWDC still retained majority control over the Land, FWDC executed an instrument entitled “Falmouth Woods First Amendment to Declaration of Covenants, Easements, and Restrictions.” Said amendment, which is dated February 18, 1988, included changes to the definition of “Subdivision Plan” to incorporate several later approved and recorded plan modifications (none of which modifications incorporated any of the North Plan lots or parcels.) The Amendment also replaced the text in the original first paragraph of Section 3.1(b) (iii) with the following new text:

Country Club Area. The Country Club Area means that portion of Lot 9 shown as “Lease Area” on a plan entitled “Plan of Land Prepared for Whitney Cape Cod Limited Partnership in Hatchville, Falmouth, Mass.” dated July 7, 1987 by Holmes & McGrath, Inc. to be recorded in the Registry of Deeds with a Land Lease from Kettle Hole, Inc. to the Declarant (the “Recreation Lease”). The “Country Club Area” shall be used only for “Country Club Purposes” except that the westerly 150 foot wide portion of the Country Club Area shown as the “Wildlife Corridor” on said plan shall be subject to the provisions of Section 3.1 (b) (v) of this Declaration. [Emphasis added.] [Note 12]

On the date the Amendment to the 1987 Declaration was executed, neither FWDC nor the Community Association held any record interest in Lot 9 or the “Lease Area” portion of Lot 9; nor was Longshank (the then-record owner of Lot 9) a signatory to the Amendment. The Amendment to the 1987 Declaration was recorded on March 4, 1988 at Book 6161, Page 305. (Hereafter, the Declaration, as so amended, will be referred to as the “1988 Declaration” and Section 3.1(b) (iii), either as originally included in the 1987 Declaration, or as amended in the 1988 Declaration, will be referred to as the “Country Club Provision.” )

Importantly, several other instruments were recorded on the same date as and subsequent to, the 1988 Declaration in the following order:

1. A deed from the Longshank Trustee, conveying Lot 9 on the North Plan to Whitney Cape Cod Limited Partnership (“Whitney”), recorded at Book 6161, Page 313.

2. A deed conveying Lot 9 from Whitney to Kettle Hole, Inc. (“Kettle Hole”), recorded at Book 6161, Page 323.

3. A mortgage on the Subdivision Land, granted by FWDC to Bank of New England (“BNE”), recorded at Book 6161, Page 331 (the “Subdivision Mortgage”).

4. A mortgage on Lot 9 and Subdivision Plan Parcels C and D, [Note 13] granted by Kettle Hole to BNE, recorded at Book 6162, Page 22 (the “Lot 9 Mortgage”).

5. A 60-year lease of a 155.39 acre portion of Lot 9 (the “Lease Area”) from Kettle Hole to FWDC, recorded at Book 6162, Page 39 (the Lease”). Recorded with, and referenced in, the Lease was a plan of land entitled: “Plan of Land Prepared for Whitney Cape Cod Limited Partnership in Hatchville, Falmouth, Mass.” dated July 7, 1987 by Holmes & McGrath, Inc. and recorded in Plan Book 445 at page 58 (the “Lease Plan”).

6. A mortgage on FWDC’s leasehold interest in the Lease Area, granted by FWDC to BNE, recorded at Book 6162, Page 54 (the “Leasehold Mortgage”).

With the exception of the Subdivision Mortgage, none of the above-described instruments referenced either the 1988 Declaration or the 1987 Declaration. Moreover, the Lease (although plainly recognizing Lessee FWDC’s intention to construct and operate a private country club on the Lease Area) does not refer to, purport to impose, or obligate FWDC to impose, a restriction limiting the use of the Lease Area for the benefit of the Subdivision.

The Lot 9 Mortgage is expressly made “subsequent and subordinate” to the Lease. Also, the Exhibit “A” property description attached to the Lot 9 Mortgage recites that “a portion of Lot 9 is subject to” the Lease. The Leasehold Mortgage similarly recites that the Lease is “being recorded herewith but prior hereto.”

In 1990, BNE foreclosed on the Subdivision Mortgage, the Lot 9 Mortgage, and the Leasehold Mortgage. By foreclosure deed dated September 18, 1990, and recorded at Book 7308, Page 253, BNE conveyed the open space parcels, roadways, and all lots remaining under the Subdivision Mortgage [Note 14] to Falmouth Land Co. (the “Subdivision Foreclosure Deed”). BNE also conveyed the Leasehold estate to Falmouth Land Co. by foreclosure deed of the same date, recorded at Book 7308, Page 246 (the “Leasehold Foreclosure Deed”). And, by foreclosure deed also dated September18, 1990, and recorded at Book 7308, Page 266, BNE conveyed Lot 9 [Note 15] to Falmouth Land Co (the “Lot 9 Foreclosure Deed.”). Thus, following the foreclosures by BNE, the fee interest in all of the previously unsold Subdivision Land, the fee interest in Lot 9, and the Leasehold interest in the Lease Area portion of Lot 9, all came under single ownership.

The property description in the Subdivision Foreclosure Deed recites that the property includes “all easements and rights now or hereafter appurtenant thereto or exercisable in connection therewith….” However, neither the Subdivision Foreclosure Deed, nor either of the other two Foreclosure Deeds, makes specific reference to the 1987 or 1988 Declarations, or to any deed restrictions or covenants limiting the use of Lot 9 or the Lease Area to country club purposes.

Falmouth Land Co. subsequently conveyed out all of its interests in Lot 9 and the Subdivision (along with its interests in several other parcels it had acquired in the vicinity through foreclosure) to Ballymeade Development Corporation (“BDC”). The special warranty deed from the Falmouth Land Co. to BDC was recorded on March 19, 1993 at Book 8487, Page 284. It describes the conveyed land in two parts — “Premises 1” (with reference to the property description in the Subdivision Foreclosure Deed recorded at Book 7308, Page 253), and “Premises 2” (with reference to the property description in the Lot 9 Foreclosure Deed recorded at Book 7308, Page 266, and to a property description in a foreclosure deed not relevant here).

The March 19, 1993 deed to BDC recites that the land conveyed is subject to certain encumbrances listed in Exhibit B to the deed, entitled “Permitted Exceptions.” Permitted Exception #15 is described in said Exhibit B as follows:

Declaration of Covenants, Easements and Restrictions dated May 1, 1987 and recorded in said Registry of Deeds in Book 5719, Page 262 as to the land shown on Plan 414 Pages 75-8 [the Subdivision Plan] as amended by instrument dated February 18, 1988 recorded in said Registry of Deeds. [Emphasis added.]

Exhibit B lists no such encumbrance in relation to Lot 9. Also, the Lease is not listed, and, except for the recorded 1987 Special Permit, Exhibit B lists no Permitted Exceptions pertaining to uses on Lot 9. As related above, the 1987 Special Permit conditionally authorized development and operation of a private, not for profit club use on Lot 9, but did not require that the land be permanently restricted to such use. [Note 16]

On December 14, 1993, BDC conveyed Lot 9 to Ballymeade Associates Limited Partnership I (“BALPI”), by deed recorded at Book 8944, Page 154. Although BDC would have had the right to subject Lot 9 to a restrictive covenant for the benefit of its remaining Subdivision Land, the deed did not reference either the 1987 or the 1988 Declarations; did not reference the Subdivision Plan; did not reserve any rights in Lot 9; and did not purport to convey the land subject to a use restriction. Also on December 14, 1993, by deed recorded at Book 8944, Page 170, [Note 17] BDC conveyed the Subdivision Land it still owned to BDC’s general partner, CLSV Associates Ltd. Partnership (“CLSV”). The deed to CLSV does not purport to convey any appurtenant rights in Lot 9, and does not reference the 1988 Declaration or the 1987 Declaration.

Nine years later, by deed dated January 14, 2003, and recorded at Book 16253, Page 90, BALPI conveyed to Plaintiff New Falmouth an approximately 129-acre portion of what had been Lot 9 on the North Plan. The portion of former Lot 9 conveyed to New Falmouth is shown as “Lot 1B” on a plan of land entitled: “Plan of Land of Fairway Pointe prepared for Ballymeade Associates Limited Partnership I in Falmouth MA,” by Holmes and McGrath, Inc., dated August 28, 1995 and recorded in Plan Book 523 at Page 65 (the “Fairway Pointe Plan”). Lot 1B includes a substantial part of the area which had been delineated as the Lease Area on the Lease Plan, as well as other portions of former Lot 9. The deed from BALPI to the Plaintiff reserved no rights in the land conveyed; imposed no restrictions on the use of Lot 1B; and included no references to the 1987 or 1988 Declarations.

DISCUSSION

Based upon the foregoing undisputed facts, I find that the Plaintiff is entitled to partial summary judgment declaring that the Defendants do not hold an enforceable restriction limiting the use of Lot 1B to country club purposes. As discussed more fully below, the Declarant of the 1987 and 1988 Declarations had no power to unilaterally impose a use restriction on land in which it held no property interest. Moreover, neither the 1987 Declaration, nor the 1988 Declaration, can reasonably be read as imposing a restrictive covenant on the Country Club Area — land which was not part of the Subdivision Land governed by the Declarations. Instead, I read the Country Club Provision in both versions of the Declaration as reciting an obligation on the part of the Declarant (or the Community Association in the case of the 1987 Declaration) to limit use of the defined Country Club Area to country club purposes if, and when, it entered into the anticipated long-term lease for such Area. Such an obligation would have been enforceable only against the Declarant [Note 18] or its successors, and only while the anticipated long-term lease was in effect.

Further, although FWDC would have had the right to record a restriction on the Lease Area for the benefit of the Subdivision once it acquired the leasehold interest in that Area, it did not do so. The mere recording of the 1987 and 1988 Declarations would not have imposed the restriction. But even if the terms of the Country Club Provision were construed, as the Defendants urge, as imposing a restriction on the Lease Area, such a restriction could only have encumbered the Declarant’s leasehold interest and, consequently, would have been extinguished by merger in 1990 when both the leasehold and the fee in Lot 9 came under common ownership following the mortgage foreclosures by BNE.

The “Country Club Provision” in the Declarations Did Not Impose a Restriction on the “Country Club Area.”

As a threshold matter, I find that the Country Club Provision, as set forth in the 1987 Declaration, did not impose an enforceable restriction on the “Country Club Area” described therein, because neither of the signatories to the Declaration then held any interest in the land comprising said Area. In order for a restrictive covenant to run with the land: (1) the covenant must be evidenced in a writing signed by the party to be charged (the covenantor); (2) the deed must express the covenantor’s intention that the covenant run with the land; (3) the deed must grant mutual easements sufficient to satisfy the requirement that the parties be in privity of estate; and (4) both the benefit and the burden of the covenant must touch and concern the affected parcel(s) of land. Well-Built Homes, Inc. v. Shuster, 64 Mass. App. Ct. 619 , 626-27 (2005).

“When the existence of a servitude over one parcel of land for the benefit of another is asserted, it must appear that it was the intention of the grantor, by inserting in his deed the condition or restriction, to create a servitude or right, which should inure to the benefit of a particular parcel of land, and be annexed to it as an appurtenance.” Bessey v. Ollman, 242 Mass. 89 , 91 (1922) [emphasis added]. Here, no such intention appears anywhere on the face of the deed transferring the Subdivision from the Longshank Trustee to FWDC. And there is nothing in the summary judgment record to demonstrate that Longshank otherwise granted FWDC or its successors the benefit of an appurtenant restriction on the use of North Plan Lots 11 or 9 through mutual easements. [Note 19]

Further, the execution and recording of the 1987 Declaration alone could not create a restriction on the Country Club Area. It is axiomatic that a party cannot unilaterally impose restrictions on land in which that party holds no interest. At the time the 1987 Declaration was executed and recorded, the Declarant held no deeded interest in Lots 9 or 11 on the North Plan (the designated “Country Club Area”). The Longshank Trustee (the then-record owner of the “Country Club Area”) did not sign the Declaration, and did not otherwise agree in writing to a restriction on said Area. Therefore, as the FWDC had no power to impose a restrictive covenant on the use of North Plan Lots 9 and 11 for the benefit of the Subdivision, the Country Club Provision did not effect an enforceable restriction.

Moreover, the language of the Declaration itself does not purport to impose a restrictive covenant on the land described as the Country Club Area. The express terms of the 1987 Declaration provided that said Declaration was intended to govern the Land, i.e. the land shown on the Subdivision Plan. Although the “Country Club Area” was described in Section 3.1(b) as consisting of Lots 9 and 11 on the North Plan, neither these two lots, nor any other North Plan Lots, were included in the 1987 Declaration’s definition of the “Land” to be governed there under. The 1987 Declaration also does not impose any obligations upon the Subdivision lot owners to maintain the Country Club Area; nor does it specify that the lot owners would benefit from membership in any country club developed on said Area. As defined in the 1987 Declaration, the “common elements” would not include the “Country Club Area” until and unless the Community Association acquired an interest in said Area. Finally, the Country Club Provision simply recites the Community Association’s intention to enter into a long-term lease of the “Country Club Area,” and then requires that, if the Community Association does enter the long term lease, that Area would only be used for country club purposes.

For these reasons, the mere recording of the 1987 Declaration could not, and did not, impose an enforceable restriction on the portion of Lot 9 now owned (as Lot 1B) by the Plaintiff.

Lot 1B Is Not Burdened by an Implied Servitude or an Equitable Servitude.

The Defendants argue that, notwithstanding the Declarant’s lack of deeded rights in the “Country Club Area” at the time the 1987 Declaration was executed and recorded, and notwithstanding the lack of any other recorded instrument evidencing the then-record owner’s intention that the use of Lots 9 and 11 on the North Plan be restricted under the terms of that Declaration, the court should find an implied servitude or an equitable servitude. They argue that the circumstances surrounding the creation of the two subdivisions and the execution of the 1987 Declaration should be interpreted as imposing a restrictive servitude on Plaintiff’s land as a matter of equity. The Defendants equitable arguments are unsupported by the facts or the law.

The Defendants have cited no Massachusetts authority for the proposition that a servitude restricting the use of land may be implied from the circumstances, where there is no signed instrument to be construed. Compare, Well-Built Homes, Inc. v. Shuster, 64 Mass. App. Ct. 619 (covenant permitting future restrictions on lot owner’s land was enforceable pursuant to divorce agreement where not expressed in deed). This is not a situation involving a common scheme, under which reciprocal obligations may be implied from the deeds of a developer. See, e.g., Guillette v. Daly Drywall, 367 Mass. 355 (1975); Sullivan v. O’Connor, 81 Mass. App. Ct. 200 (2012). See also Restatement (Third) of Property (Servitudes) (2000), § 2.14 (1) (b) (“[a] conveyance by a developer that imposes a servitude on the land conveyed to implement a general plan creates an implied reciprocal servitude burdening all the developer’s remaining land included in the general plan, if injustice can be avoided only by implying the reciprocal servitude.”). Nor does this situation involve an easement which may be implied from the circumstances of the conveyance. [Note 20]

I also find no support in the summary judgment record for the Defendants’ alternative argument that the 1987 Declaration resulted in an equitable servitude, enforceable against the Plaintiff as a buyer with actual and constructive notice of such servitude. In order to enforce an equitable servitude, the party against whom enforcement is sought must have notice of the relevant restrictions. Here, there is simply no factual or legal basis for the Defendants’ contention that, because the Plaintiff knew that property was being used for country club purposes at the time it purchased Lot 1B, the Plaintiff had actual notice of a use restriction. Further, contrary to the Defendants’ contentions, the instruments in the Plaintiff’s chain of title would not have put the Plaintiff on constructive notice that Lot 1B might be subject to a use restriction under the terms of the 1987 Declaration. The Declaration itself is not recorded in Plaintiff’s chain of title, and any references to the Declaration which might be found in instruments recorded in the Plaintiff’s chain of title, such as in the deed from Falmouth Land Co. conveying the previously unsold Subdivision Land and Lot 9 to BDC, are references made specifically in connection with the Subdivision Land — not Lot 9. See Stewart v. Alpert, 262 Mass. 34 , 38 (1928) (“buyer of real estate cannot be charged with constructive notice of an equitable servitude unless he can find it recorded somewhere in his chain of title.”)

However, even if a title examination for Lot 1B would have led to an examination of the 1987 Declaration, as has been discussed above the Declaration itself does not purport to impose a restriction running with land located outside of the Subdivision. Moreover, Plaintiff’s investigation of the instruments on record would have revealed that: (1) Lot 1B was never part of the Subdivision; (2) no record owner of the land now known as Lot 1B ever signed an instrument purporting to restrict, or to permit a restriction to be imposed on, said land; and (3) the country club use limitations described in the 1987 Declaration would, by their own terms, have applied only in the event the subject land was leased by the Community Association, and further investigation would have revealed no record of the Community Association entering into the long-term lease described in the 1987 Declaration.

Therefore, given the instruments of record, there is no basis for finding that an implied servitude or an equitable servitude has been imposed on the Plaintiff’s land under the terms of the 1987 Declaration. As the Supreme Judicial Court observed in Houghton v. Rizzo, 361 Mass. 635 , 643 (1972),

…the proliferation of implied rights in or equitable servitudes upon real estate, which cannot be readily ascertained by an examination of the records of the appropriate registry of deeds or of the Land Court, will serve only to further erode the integrity and reliability of such records and will be a subversion of the fundamental purpose for which such records are required to be made and maintained.

The Defendants nevertheless argue that the court should ignore the instruments of record and consider, instead, the circumstances surrounding the 1987 Declaration. They assert that it was Patricia Harrison and Stephen Harrison (the “Harrisons”) who, as the “principals” of a real estate project encompassing both subdivision tracts, controlled several entities involved in holding and developing the two subdivision tracts and directed that use of the “Country Club Area” be restricted under the 1987 Declaration. As support for these assertions, the Defendants’ rely upon an affidavit from the former Longshank Trustee, Bruce Ramsey, dated January 11, 2011 (the “Ramsey Affidavit”).

Ramsey’s Affidavit is not proper support for the Defendants’ equitable servitude claim, however. First of all, extrinsic evidence in the form of an affidavit concerning the circumstances of the 1987 Declaration is not appropriate here. See e.g., Hanson v. Cadwell, 66 Mass. App. Ct. 497 , 502-03 (no necessity to construe language in relevant deeds and plan in light of attendant circumstances, where the court was able to begin and end its inquiry in the case by reference to the unambiguous language in the relevant deeds and plan.) As in Hanson, this is not a situation where the court must determine the parties’ intentions with respect to ambiguous language contained in a deed or other instrument signed by the owner of the land to be burdened. As discussed, the language of the deed conveying the Subdivision to FWDC is unambiguous in its silence as to any intended restrictions on the retained North Plan land, and the Longshank Trustee did not sign the Declaration or any other contemporaneous writing expressing his intention, as then-record owner, that said land be subjected to a restrictive covenant.

Secondly, several of the averments in the Ramsey Affidavit do not satisfy the requirements of Mass. R. Civ. P 56 (c) and, therefore, the Plaintiffs’ motion to strike Paragraphs 6, 8, 10, 11 and 12 of the Ramsey Affidavit is ALLOWED. At the very least, Ramsey’s statements concerning the Harrisons’ intent and understanding contain inadmissible hearsay. And the Harrisons’ intentions and beliefs are, in any event, irrelevant as they were not the record owners of the land to be burdened, and were not parties to any of the pertinent instruments. Furthermore, even if FWDC and the Longshank Trustee did intend for the 1987 Declaration to create a use restriction on the “Country Club Area,” that intention was not set forth in a writing signed by said Trustee. Consequently, Ramsey’s present statements as to his and FWDC’s intentions in 1987 are also irrelevant. Cf. Bongaards v. Millen, 440 Mass. 10 , 15 (2003) (where the grantor lacks title, a mutual intent to convey and receive an interest in the property is “beside the point.”) Accordingly, I find that the Defendants have failed to establish that an equitable servitude was imposed upon Lot 1B.

The 1988 Declaration Also Did Not Result in an Enforceable Restriction on Plaintiff’s Land.

It is undisputed that the Declarant FWDC held no interest in Lot 9, or in the Lease Area portion of Lot 9, at the time it executed the 1988 Declaration containing the amended Paragraph 3.1(b) (iii) Country Club Provision. In contrast to the facts surrounding the 1987 Declaration, the several instruments recorded on the same day as, and immediately following the recording of the 1988 Declaration support the Defendants’ contention that the 1988 Declaration was made in connection with a deal involving Longshank, Whitney, Kettle Hole and FWDC, which culminated in the conveyance of Lot 9 from Longshank to Whitney, the conveyance of Lot 9 from Whitney to Kettlehole, and ultimately, FWDC’s lease of the Lease Area of Lot 9 for construction and operation of a country club, as was contemplated in the amended Country Club Provision. However, as will be discussed, these circumstances did not ultimately result in an enforceable restriction on Plaintiff’s land.

The Defendants argue that simply recording the 1988 Declaration containing the Country Club Provision was sufficient to impose a permanent use restriction on the Lease Area. The Plaintiff counters that the language of the Country Club Provision in the 1988 Declaration, at best, created an obligation on the part of the Declarant to restrict use of the Lease Area to country club purposes once it entered into the Lease. But, the Plaintiff points out, the Declarant FWDC never did record a restriction on the Lease Area during the period it held the Lease.

For essentially the same reasons that the recording of the 1987 Declaration did not effect a restriction on the North Plan land described as the “Country Club Area,” the simple act of recording the 1988 Declaration was not enough to encumber the Lease Area portion of Lot 9 with a use restriction. The amendments incorporated in the 1988 Declaration did not alter the definition of the “Land” covered by the Declaration to include the Lease Area. Also, the language of the amended Section 3.1(b) did not purport to impose a restriction running with the portion of the North Plan land defined as the “Country Club Area.” Rather, similar to the 1987 Declaration, the amended Country Club Provision imposed an obligation on the Declarant to limit the use of the Lease Area if and when it should enter into the anticipated long term lease with Kettle Hole. But, although FWDC could have recorded a restriction on the Lease Area once it entered into the long-term lease, it did not do so.

But even if the 1988 Declaration itself were construed as imposing an enforceable restriction on the Lease Area once the Lease was recorded, such a restriction would have been enforceable only so long as FWDC’s leasehold continued. That is, absent Kettle Hole’s agreement, [Note 21] FWDC could have restricted only its leasehold interest; it could not permanently encumber the underlying fee interest in the Lease Area. [Note 22] Once the leasehold was terminated, any restrictions on the use of the Lease Area which might have arisen under the Country Club provision in connection with FWDC’s Lease would likewise have been extinguished. And, as will be discussed below, the leasehold was terminated by merger when the Falmouth Land Co. acquired both the Leasehold and the fee in Lot 9 following the 1990 foreclosures.

The Foreclosures

Without conceding that the recorded 1988 Declaration containing the Country Club provision was sufficient to impose a restrictive covenant on the Lease Area once the Lease was recorded, the Plaintiff urges the court to rule that the 1990 Foreclosures would nevertheless have extinguished any such restriction. Because I decide that neither the 1987 Declaration nor the 1988 Declaration imposed an enforceable restriction on the Plaintiff’s land, I address only briefly the Plaintiff’s alternative argument concerning the effect of the foreclosures.

Plaintiff’s argument ignores the fact that the Lot 9 Mortgage and the Leasehold Mortgage were made expressly subordinate to the Lease. The Leasehold Mortgage recites that the Lease is being recorded “prior hereto.” Similarly, the mortgage on Kettle Hole’s fee interest in Lot 9 (including the Lease Area) is expressly made “subsequent and subordinate to” the Lease. Consequently, the foreclosures on the Leasehold Mortgage and the Lot 9 Mortgage did not nullify the Lease and would not, therefore, have extinguished any use restriction on the Lease Area which may have arisen in connection with FWDC’s Lease. See Restatement (Third) of Property (Servitudes) (2000) S. 7.9 (“A servitude is not extinguished by foreclosure of a lien against the estate burdened by the servitude unless the lien has priority over the servitude.”)

However, while the mortgage foreclosures could not have extinguished a use restriction imposed in connection with the Lease, a restriction on the leasehold interest in Lot 9 would not, in any event, have survived after the 1990 foreclosure sales. This is because the leasehold interest was terminated by merger when the Falmouth Land Co. acquired both the leasehold interest and the fee interest in Lot 9 by foreclosure deed. See Hurley v. Ahearn, 338 Mass. 695 , 697 (1959) (citing Johnson v. Johnson, 7 Allen 196 , 198 (1863) (defining merger as “the annihilation by act of law of the less in the greater of two vested estates meeting, without any intervening estate, in the same person and in the same right.”)). Thus, even if FWDC’s leasehold estate had been made subject to a restriction when the Lease was recorded, termination of the Lease by merger would have extinguished any such restriction.

CONCLUSION

For the reasons set forth above, I find that Plaintiff is entitled to partial summary judgment in its favor, declaring that Lot 1B is not burdened by a restrictive covenant limiting its use to country club purposes pursuant to either Paragraph 3(1) (b)(iii) of the 1987 Declaration, or Paragraph 3(1) (b)(iii) of the 1988 Declaration. Because I find that Plaintiff’s land was never subject to an enforceable restriction limiting its use to country club purposes, and because I find that even if the Country Club Provision could be construed as imposing a restriction on FWDC’s leasehold interest, such a restriction would have terminated in 1990 upon merger of the leasehold and fee interests in Lot 9, I need not reach the further issue presented in the Parties’ summary judgment memoranda as to whether a subsequently recorded restatement and amendment of the 1988 Declaration, which omitted the Country Club Area provision, was effective as a matter of law.

This decision does not resolve all of the parties’ claims and counterclaims. Therefore, final judgment will not enter at this time. Counsel for the parties shall appear at a status conference at 2:00 PM on September 15, 2012 to discuss how they intend to proceed with the remainder of the litigation.