Miller v. BAY CITY PROPERTY OWNERS ASSOC., INC.

CATHELL, J. This case concerns the creation of covenants of reservation in real property schemes of development. Eric Miller, petitioner, purchased a tract of land from Bay City Property Owners Association, Inc. (“BCPOA”), respondent. Petitioner filed suit in the Circuit Court for Queen Anne’s County after being denied permission to build a residence on the purchased lot because the tract of land was alleged by BCPOA to be restricted to use as a “Community Boat Harbor Reservation.” The Circuit Court granted petitioner’s motion for summary judgment, finding that respondent failed to comply with the requirement that a plat reflecting the boat harbor reservation be recorded in order for the reservation to become effective. Respondent filed a timely appeal with the Court of Special Appeals.

That court, in an unreported opinion, determined that respondent’s recording of a declaration designating the lot in question as a boat harbor reservation was sufficient to comply with the requirement that a plat be recorded. Petitioner filed a petition for writ of certiorari on December 20, 2005; we granted certiorari on March 9, 2006. Miller v. Bay City Prop. Owners Ass’n, 391 Md. 577 , 894 A.2d 545 (2006).

Petitioner presented the following question for our review: “Did the Court of Special Appeals have a legal basis to reverse the Circuit Court for Queen Anne’s County?” The answer to this question requires us to determine whether a statement in a recorded declaration is sufficient to enforce a covenant creating the right to designate a reservation but specifically requiring the filing of a plat showing that the lot in question was designated as a boat harbor reservation. Under the ⁶²⁴ circumstances here present, we hold that respondent’s failure to file a plat, as specifically required, prevents it from enforcing the alleged restrictive covenant as to the Lot at issue in the case at bar. I. Facts On June 9, 1952, the deed for the development in which the property in question is located was recorded in the Land Records of Queen Anne’s County. The land was to be developed as a residential community including “dwelling houses, a retail commercial area, non-commercial structures, including churches, recreational facilities and structures, and such other buildings as are customary in such communities .... ” In the deed, the developers determined that “it is considered impractical, at this time, or at any one time, to develop or lay out all of the said tract, or to fix, for all parts thereof, the particular residential dwelling, retail commercial area, or non-commercial uses ...; but a general outline plat of the total acreage included within the whole of said development has been prepared by the said Corporation, which shows the area reserved for residential or dwelling uses, and other areas tentatively reserved for residential, dwelling and retail commercial uses and non-commercial and recreational uses, including tentative Beach Reservations, without particularizing or specifying as to the exact locations for the establishment of said additional Beach Reservations, or of the retail commercial, non-commercial and recreational uses which are to be made in the lands therein contained; and said ‘GENERAL OUTLINE PLAT’ is recorded or intended to be recorded among said Land Records of Queen Anne’s County, simultaneously with the recording of this Deed and Agreement .... ” [Emphasis added.] The plat filed with the deed presented a tentative layout of the tract of land.

Although most of the layout on the plat was tentative, the deed specifically provided that some of the lots would have a fixed purpose: ⁶²⁵ “WHEREAS, the said Corporation expressly reserves unto itself, and its successors, the right to change the Tentative Layout of the sections, blocks, and reservations, as to the ground plan lay-out, and as to residential and dwelling areas, and as to recreational and non-commercial uses, now shown on said general outline plat (other than Blocks One to Twenty, inclusive, in Section One, as shown on said Outline Plat, and the location of the ‘Community Bathing Beach’, which said section, blocks, locations and facilities are hereby fixed and shall now be considered to be irrevocable and unchangeable), as, from time to time, the said Corporation shall determine for each succeeding section (which need not be developed or recorded in numerical order) the final determination of such plans and uses as to each section, to be evidenced by the recording of the Plat for the same among the Land Records of Queen Anne’s County.” [Emphasis added.] In addition to the lots evidently designated for a “Community Bathing Beach,” the deed contained a number of covenants that established the process to be used for future designations and restrictions on the use of the lots. One of those covenants stated: “COMMUNITY BOAT HARBOR RESERVATION” “(7) The Corporation, for itself and its successors in the ownership or development of the land contained in said Community, desires and expects, and therefore reserves the right, in the future, to select, fix and determine the location, upon the waters of Board [sic] Creek, of a parcel of land, to be known and designated as a ‘Community Boat Harbor Reservation’ and to show and designate the location of said ‘Community Boat Harbor Reservation’, upon a plat thereof, to be hereafter filed for record among the Land Records of Queen Anne’s County”. 1 ⁶²⁶ “(8) Upon the date of the recording of said plat, upon which is designated the location of said ‘Community Boat Harbor Reservation’ such ‘Community Boat Harbor Reservation’ shall, from thenceforth be expressly and irrevocably reserved, dedicated and restricted to use in common by the bona fide members of the Association, which shall be formed, as hereinbefore and hereinafter indicated, for the harboring of boats, of such boating and recreational projects and activities as may be conducted, and—the conduetedy sponsored or promoted by said Association.” [Emphasis added.] The original deed, therefore, provided specifically how the “Community Boat Harbor Reservation” was to be created and that there was only to be one. The only plat filed after the original tentative plat, is dated October 17, 1958, and does not designate any lot or lots as a “Community Boat Harbor Reservation.” On April 7, 1963, the lot in question in this appeal was transferred, with a number of other tracts, to the Bay City Improvement Association, Inc. (“BCIA”), later to become BCPOA. Eleven years later, on December 16, 1975, BCIA recorded a “Declaration,” which stated: “Explanatory Statement” “By Deed and Agreement dated May 29, 1952, and recorded among the Land Records of Queen Anne’s County, ...

The Bridgeside Company established certain ‘covenants, restrictions, reservations, dedications, conditions, agreements and understandings’ with respect to a subdivision known as ‘Bay City’ .... “Paragraphs (7) and (8) of the Deed and Agreement of May 29, 1952, refer to a ‘Community Boat Harbor Reservation’ to be established by The Bridgeside Corporation, or its successors in the ownership or development of the land in Bay City____Bay City Improvement Association, Inc. was assigned certain rights and privileges with respect to the provisions of the aforesaid Deed and Agreement of May 29, 1952. ⁶²⁷ “By Deed recorded among the Land Records ..., Bay City Improvement Association is the owner, in fee simple, of Lots 11 and 12, Block 24, and Lot 27, Block 32, as shown on a plat entitled ‘Plat 2, Section 2, Bay City’, ... dated October 17, 1958 .... “At a meeting of the Board of Directors of Bay City Improvement Association and at a meeting of the members held on September 7, 1975, the Corporation authorized and directed that the lots designated in the preceding paragraph be designated as ‘Community Boat Harbor Reservation’ as referred to in the Deed and Agreement of May 29, 1952. “Bay City Improvement Association, Inc., does further declare that: “1. The portion of the aforesaid Plat of October 17.1958, which shows the lots designated above is hereby adopted as the plat which shows and designates the location of said ‘Community Boat Harbor Reservation’ as referred to in Paragraph (7) of the Deed and Agreement of May 29, 1952. “2. From the date hereof, the lots referred to herein shall be expressly and irrevocably reserved, dedicated and restricted to use in common by the bona fide members of Bay City Improvement Association, Inc., for the harboring of boats or such boating and recreational projects and activities as may be conducted, sponsored or promoted by the Association subject only to reasonable regulations and charges with respect to such use as may be made by the Association.” The declaration was recorded in the Land Records of Queen Anne’s County; however, a plat designating the “Community Boat Harbor Reservation” was never filed as required by the original reservation of the right to designate. Moreover, Lots 11 and 12 in Block 24, although contiguous with each other, are far removed and on the opposite side of Broad Creek from Lot 27 in Block 32 and not even opposite of that lot across ⁶²⁸ Broad Creek.

Accordingly, they cannot reasonably be construed as a single harbor. It is beyond dispute that the respondent is attempting to create multiple boat harbors where, even if it had done so properly, the reservation it was attempting to exercise only conferred upon it the right to create a single boat harbor. 2 On September 25, 2000, petitioner wrote a letter to respondent in which he stated: “I am [an] avid fisherman/boater and would thoroughly enjoy having private access to the water within close proximity to my existing residence in Bay City. ■ “This is the reason I am willing to offer a reasonable price of $25,000.00 for your lot. I also understand that on top of the $25k for the lot, I will also takeover the payments on the sewer assessment on said lot of approximately 15K, for a total investment of $40k. “Thank you for consideration in this matter and also please note that I am in the position to offer a quick cash settlement.” Two months later, on November 30, 2000, petitioner and respondent entered into a standard sales agreement. On December 7, 2000, Lot 27, Block 32, was conveyed to petitioner in fee simple under a special warranty deed.

This deed made no express reservations as to “Community Boat Harbor” use. After the transfer, petitioner decided to pursue building a residential dwelling on the property. On March 16, 2001, ⁶²⁹ respondent provided the following response to one of petitioner’s requests: “Bay City Property Owners Association, after careful review of the proposed building plans submitted by Eric Miller, would be willing to reduce the front line set-backs from Irene Way from 35 feet to 25 feet.” Notwithstanding this letter, the chairman of the association’s Architectural and Permit Committee stated that “no formal application for building permit was received from Mr. Miller for 407 Irene Way (Lot 27, Block 32) until April 25, 2003.” Respondent’s subsequent denial of petitioner’s application for a building permit because the lot was mentioned in the declaration aforesaid as a “Community Boat Harbor Reservation” gave rise to the case at bar. Petitioner filed a complaint in the Circuit Court for Queen Anne’s County asking the court for a declaratory judgment stating that the filing of a plat designating Lot 27 as a “Community Boat Harbor Reservation” was a condition precedent to the enforcement of the restrictive covenant prohibiting petitioner from building a residence on that lot.

The complaint also alleged: breach of the sales contract, breach of warranty with respect to the special warranty deed, and unfair and deceptive practices. Both petitioner and respondent filed motions for summary judgment stating that there was no genuine dispute of material facts. Petitioner asked the court to determine that, as a matter of law, respondent was required to file a plat designating the lot as a community boat harbor and that failure to file such plat prior to the conveyance of the lot to petitioner prevented BCPOA from denying petitioner’s application for building on the lot. Respondent argued that the recorded declaration satisfied the plat recording requirement of the 1952 deed.

The Circuit Court, in its memorandum opinion, determined that: “It is a basic tenet of property law that restrictions are in derogation of free conveyance, are not favored, and will be construed strictly against the enforcing party.” (citing Balt. Butchers Abattoir & Live Stock Co. v. Union Rendering Co., 179 Md. 117 , 17 A.2d 130 (1941)). As a result, failure to record a plat alone, as expressly required by the 1952 deed, ⁶³⁰ voided respondent’s attempt to establish a “Community Boat Harbor Reservation” on Lot 27. Nevertheless, the Circuit Court went on to explain that, in addition to the failure to record the plat and the limitation to a single boat harbor reservation, respondent’s actions with respect to the sale of Lot 27 were inconsistent with its argument that the lot was considered a Community Boat Harbor Reservation.

The Circuit Court then granted summary judgment in favor of petitioner. The Court of Special Appeals took a different approach and arrived at the opposite conclusion. The intermediate appellate court acknowledged that “ ‘[cjovenants creating restrictions are to be construed strictly in favor of the freedom of the land, and against the person in whose favor they are made[.]’ ” (quoting McKenrick v. Savings Bank of Balt., 174 Md. 118, 128 , 197 A. 580, 584 (1938)). It determined, however, that the language defining the restrictive covenant was to be interpreted in light of the familiar rules of contract construction.

The court pointed to Maryland Coal Co. v. Cumberland and Pennsylvania Railroad, 41 Md. 343, 352 (1875), for the standard to be used in evaluating the covenant: “[I]t is the duty of courts to ascertain, if possible, the intention of the parties, as manifested by the terms of the instrument. If the intention of the parties is plainly manifest upon the face of the instrument there is no room for interpretation, and there is nothing left for the courts but to carry into effect the intention of the parties so ascertained, unless prevented from doing so by public policy or some established principle of law. The rule is well settled that, in ascertaining the meaning of words in a deed or other written instrument, technical words must be given their technical meaning and signification.” Id. at 352 . The Court of Special Appeals held that the intent of the parties in stating that the plat designating the lots as a “Community Boat Harbor Reservation,” was to provide notice to future purchasers that the lots so designated were burdened by the stated condition.

As a result, the filing of the 1975 declaration, which adopted the original plat and designat ⁶³¹ ed the lots as a “Community Boat Harbor Reservation,” according to that court was sufficient to comply with the requirement of the 1952 deed. The intermediate appellate court also found that the Circuit Court’s reliance upon BCPOA’s actions regarding the sale were immaterial and, furthermore, their consideration would result in a genuine dispute of material facts, which made the grant of summary judgment in favor of the petitioner inappropriate.

II

Standard of Review “Maryland Rule 2-501 indicates that a motion for summary judgment is appropriate ‘on all or part of an action on the ground that there is no genuine dispute as to any material fact and that the party is entitled to judgment as a matter of law.’ A motion for summary judgment may be supported by affidavit. When reviewing the grant or denial of a motion for summary judgment we must determine whether a material factual issue exists, and all inferences are resolved against the moving party.” King v. Bankerd, 303 Md. 98, 110-111 , 492 A.2d 608, 614 (1985) (citing Lynx, Inc. v. Ordnance Products, Inc., 273 Md. 1, 7-8 , 327 A.2d 502, 509 (1974)). “ ‘[E]ven where the underlying facts are undisputed, if those facts are susceptible of more than one permissible inference, the choice between those inferences should not be made as a matter of law, but should be submitted to the trier of fact.’ ” King v. Bankerd, 303 Md. at 111 , 492 A.2d at 614 (quoting Porter v. General Boiler Casing Co., 284 Md. 402, 413 , 396 A.2d 1090, 1096 (1979) (citations omitted)). The function of a summary judgment proceeding is not to try the case or to attempt to resolve factual disputes but to determine whether there is a dispute as to material facts sufficient to provide an issue to be tried. Honaker v. W.C. & A.N. Miller Development Co., 285 Md. 216, 231 , 401 A.2d 1013, 1020 (1979) (citing Dietz v. Moore, 277 Md. 1, 4-5 , 351 A.2d 428 (1976)).

A ‘material fact’ is one which will somehow affect the outcome of the case. Id. (citation omitted). ⁶³² “An appellate court reviewing a summary judgment examines the same information from the record and determines the same issues of law as the trial court. Paine-Webber Inc. v. East, 363 Md. 408, 413 , 768 A.2d 1029, 1032 (2001) (citation omitted).

We are often concerned with whether a dispute of material fact exists when reviewing the grant of a summary judgment motion. Lippert v. Jung, 366 Md. 221, 227 , 783 A.2d 206, 209 (2001) (citing Hartford Ins. Co. v. Manor Inn of Bethesda, Inc., 335 Md. 135, 144 , 642 A.2d 219, 224 (1994)). We recently reiterated the standard of review for a trial court’s grant or denial of a motion for summary judgment in Myers v. Kayhoe, 391 Md. 188 , 892 A.2d 520 (2006): ‘The question of whether a trial court’s grant of summary judgment was proper is a question of law subject to de novo review on appeal.

Livesay v. Baltimore, 384 Md. 1, 9 , 862 A.2d 33, 38 (2004). In reviewing a grant of summary judgment under Md. Rule 2-501, we independently review the record to determine whether the parties properly generated a dispute of material fact and, if not, whether the moving party is entitled to judgment as a matter of law. Id. at 9-10 , 862 A.2d at 38 . We review the record in the light most favorable to the nonmoving party and construe any reasonable inferences that may be drawn from the facts against the moving party.

Id. at 10 , 862 A.2d at 38 .’ Id. at 203, 892 A.2d at 529 .” United Serv. Auto. Ass’n v. Riley, 393 Md. 55, 67, 899 A.2d 819, 826 (2006). 3 III. Discussion Restrictive covenants have a long history.

Garfink v. Cloisters at Charles, Inc., 392 Md. 374 , 897 A.2d 206 (2006); Kobrine v. Metzger, 380 Md. 620 , 846 A.2d 403 (2004); Roper v. Camuso, 376 Md. 240 , 829 A.2d 589 (2003); Stansbury v. ⁶³³ Jones, 372 Md. 172, 812 A.2d 312 (2002); Colandrea v. Wilde Lake Comty. Ass’n, 361 Md. 371 , 761 A.2d 899 (2000); Steuart Transp. Co. v. Ashe, 269 Md. 74 , 304 A.2d 788 (1973); Md. Coal Co. v. Cumberland and P.R., 41 Md. 343 (1875); Thruston v. Minke, 32 Md. 487 (1870). Early on, the Court recognized as settled law “that a grantor may impose a restriction, in the nature of a servitude or easement, upon the land that he sells or leases, for the benefit of the land he still retains; and if that servitude is imposed upon the heirs and assigns of the grantee, and in favor of the heirs and assigns of the grantor, it may be enforced by the assignee of the grantor against