Filed: Dec. 30, 2016
Latest Update: Mar. 03, 2020
Summary: NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT ERICK VAN LOAN, JOHN J. MORELLI, ) CHARLES ROODHOUSE, and KERRY L. ) KOONTZ, ) ) Appellants, ) ) v. ) Case No. 2D15-5430 ) HEATHER HILLS PROPERTY OWNERS ) ASSOCIATION, INC.; and RICK AND ) CHRIS STEPHENS, LLC, a Florida ) Limited Liability Company, ) ) Appellees. ) ) Opinion filed December 30, 2016. Appeal from the Circuit Court for Manatee County; John F. La
Summary: NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT ERICK VAN LOAN, JOHN J. MORELLI, ) CHARLES ROODHOUSE, and KERRY L. ) KOONTZ, ) ) Appellants, ) ) v. ) Case No. 2D15-5430 ) HEATHER HILLS PROPERTY OWNERS ) ASSOCIATION, INC.; and RICK AND ) CHRIS STEPHENS, LLC, a Florida ) Limited Liability Company, ) ) Appellees. ) ) Opinion filed December 30, 2016. Appeal from the Circuit Court for Manatee County; John F. Lak..
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NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING
MOTION AND, IF FILED, DETERMINED
IN THE DISTRICT COURT OF APPEAL
OF FLORIDA
SECOND DISTRICT
ERICK VAN LOAN, JOHN J. MORELLI, )
CHARLES ROODHOUSE, and KERRY L. )
KOONTZ, )
)
Appellants, )
)
v. ) Case No. 2D15-5430
)
HEATHER HILLS PROPERTY OWNERS )
ASSOCIATION, INC.; and RICK AND )
CHRIS STEPHENS, LLC, a Florida )
Limited Liability Company, )
)
Appellees. )
)
Opinion filed December 30, 2016.
Appeal from the Circuit Court for Manatee
County; John F. Lakin, Judge.
Nicholas F. Karatinos of Law Office of
Nicholas F. Karatinos, Lutz, for Appellants.
J. Allen Bobo and Jody B. Gabel of Lutz,
Bobo & Telfair, P.A., Sarasota, for
Appellees.
MORRIS, Judge.
Erik Van Loan, John J. Morelli, Charles Roodhouse, and Kerry L. Koontz
(the Homeowners) appeal a final judgment dismissing their complaint with prejudice.
The Homeowners filed suit after the Heather Hills Property Owners Association
(HHPOA) recorded a declaration of amended restrictive covenants running with the land
that—on its face—appears to attach to the titles of all 300 lots in the Heather Hills
Estates group of subdivisions (Heather Hills), including the lots owned by the
Homeowners. Because we conclude that the Homeowners' complaint sufficiently stated
causes of action for declaratory relief, to quiet title, and for damages for slander of title
and that those causes of action were not refuted by the exhibits attached to their
complaint, we reverse the trial court's order dismissing the complaint.
BACKGROUND
The Homeowners own individual lots and homes in Heather Hills which
was founded in 1967 in Manatee County, Florida. Heather Hills is comprised of six
mobile home residential subdivisions. Each subdivision had a separately recorded plat
and a set of restrictive covenants that was filed at the time the subdivision was
developed. Each original plat and original set of restrictive covenants reserved the right
to amend the restrictive covenants to the developer or its successors.1 Neither the plats
nor the original sets of restrictive covenants contain residential age restrictions. Further,
the original sets of restrictive covenants which were recorded on the titles of each lot in
Heather Hills do not mention a homeowners' association.
The HHPOA was incorporated in 1969 with the stated purpose of
promoting recreational and charitable interests for those living in Heather Hills.
Membership was voluntary, and the Homeowners have thus far chosen not to join it.
1
Appellee, Rick and Chris Stephens LLC, is the successor in interest to
the original developer.
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In 2012, the HHPOA amended its articles of incorporation to provide that:
"The record title holder of all lots [in Heather Hills] shall be members." The amended
articles also changed the purpose of the HHPOA to managing and operating Heather
Hills as "a community intended and operated as 'housing for older persons' within the
meaning of the Fair Housing Amendments Act of 1988, 42 U.S.C. Sections 3601, et
seq., and subsequent amendments thereto." The amended articles stated that the
HHPOA would promulgate rules and regulations to effectuate that purpose. The
amended articles were filed with the Florida Secretary of State but were not recorded
against the titles of the lot owners.
Around the same time, the HHPOA adopted an "Additional Declaration of
Covenants, Conditions[,] and Restrictions" which it then recorded in the Manatee
County Public Records. These amended restrictive covenants applied to each of the six
subdivisions within Heather Hills and were recorded against the title to each and every
lot therein. The declaration of amended restrictive covenants purported to convert
Heather Hills to an over-55 community. The amended restrictive covenants require that
at least one person residing in each dwelling must be over the age of fifty-five, and they
provide the HHPOA with the power "to approve in writing all sales, transfers of title, or
leases of a lot, block[,] or parcel" after proof of a buyer's age is provided. The
declaration expressly states that the amended restrictive covenants are "applicable to
and binding upon the lots of all consenting property owners situated in Heather Hills."2
However, the declaration subsequently states that "the owners who consent to and join
2
The amended restrictive covenants expressly state that they do not apply
to fourteen lots that are identified only by lot number, block, and unit number. Neither
party addresses these excepted lots but as evidenced by these proceedings, it
apparently does not include the homeowners' lots.
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in this Declaration do hereby impose upon the lots, blocks[,] or parcels of such owners
in Heather Hills . . . and all members of [the HHPOA]" the covenants, restrictions, and
conditions set forth in the document.3 (Emphasis added.) The declaration also
provides that the amended restrictive covenants
shall run with the land and be binding upon . . . the present
lot owners who have contemporaneously joined in the
making, and have consented to the recording of this
Declaration, and on each of said lot owners' respective heirs,
successors, personal representatives, grantees and assigns,
and on all owners who hereafter evidence their intention to
bind themselves and their property to this Declaration, and
amendments thereto, by executing and recording a Consent
and Joinder Instrument in the official format promulgated by
the . . . Board of Directors, and on each of such owners'
respective heirs, successors, personal representatives,
grantees and assigns; and on all persons or parties claiming
by, through or under any of said owners.
Because the Homeowners had not consented to becoming members of
the HHPOA or to living in an over-55 community, they filed suit bringing claims for
declaratory relief, to quiet title, and for damages for slander of title.4 The HHPOA
moved to dismiss the complaint asserting that the declaration of amended restrictive
covenants, which was attached to the Homeowners' complaint, demonstrated on its
face that it applied only to consenting lot owners and, therefore, that because the
Homeowners asserted they did not consent and were not members of the HHPOA, the
amended restrictive covenants did not apply to them.
3
Additionally, the HHPOA recorded a resolution and affidavit indicating
that two-thirds of the HHPOA members consented to having Heather Hills function as
an over-55 community.
4
The Homeowners also brought a claim for injunctive relief arguing that
the HHPOA and Rick and Chris Stephens, LLC, were misrepresenting that the
community was an age-restricted community.
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The trial court agreed and dismissed the complaint without prejudice,
finding that the claims to quiet title and for damages for slander of title failed to state
causes of action based on the declaration of amended restrictive covenants. The trial
court found that the claim for declaratory relief, which was based on the allegation that
the defendants were misrepresenting that Heather Hills was an age-restricted
community, was moot.
The Homeowners then filed an amended and second amended complaint
again asserting claims for declaratory relief, to quiet title, and for damages for slander of
title.5 As with the original complaint, the Homeowners attached the declaration of
amended restrictive covenants. However, in the claim for declaratory relief in the
second amended complaint, the Homeowners argued that the HHPOA lacked authority
to mandate membership in the HHPOA and also lacked authority to adopt new
restrictive covenants for Heather Hills. The Homeowners argued that a declaratory
judgment was necessary because when reading the HHPOA's amended articles of
incorporation in conjunction with the declaration of amended restrictive covenants, it
was unclear which lot owners were subject to the amended restrictive covenants.
The HHPOA moved to dismiss raising the same argument it raised in the
first motion to dismiss. A second trial court judge heard the HHPOA's second motion to
dismiss and, after reviewing the first order of dismissal, entered the order on appeal
dismissing the Homeowners' complaint with prejudice. The trial court found that "[t]he
covenants indicate on their face that they apply only to lot owners who have consented
to bind their respective parcels."
5
The Homeowners did not include a claim for injunctive relief in their
amended complaints.
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ANALYSIS
When considering a motion to dismiss for failure to state a cause of action,
a trial court is ordinarily bound to the allegations within the four corners of the complaint
and it must accept the material allegations as true. Consuegra v. Lloyd's Underwriters
at London, 801 So. 2d 111, 112 (Fla. 2d DCA 2001). However, where an exhibit
attached to a complaint contradicts the allegations in the complaint, the exhibits control
and may form the basis for a motion to dismiss. See Fladell v. Palm Beach Cty.
Canvassing Bd.,
772 So. 2d 1240, 1242 (Fla. 2000); Hunt Ridge at Tall Pines, Inc. v.
Hall,
766 So. 2d 399, 400 (Fla. 2d DCA 2000). But the trial court must not speculate as
to whether the plaintiff can prove its allegations; rather, the question is whether,
assuming that the allegations are true, the plaintiff would be entitled to relief. See
Meadows Cmty. Ass'n v. Russell-Tutty,
928 So. 2d 1276, 1279 (Fla. 2d DCA 2006). A
trial court should not dismiss a complaint for failure to state a cause of action unless it
can be established that there is no theory that would support the plaintiff's request for
relief.
Id. at 1280. We conduct de novo review of an order of dismissal for failure to
state a cause of action.
Id. at 1278.
I. Claim for Declaratory Judgment
The purpose of a declaratory judgment is to determine the rights and
duties of a party without resorting to a tort or contract action. See Watson v. Claughton,
34 So. 2d 243, 245 (Fla. 1948) (en banc). A claim for a declaratory judgment states a
cause of action where the plaintiff can demonstrate that he or she is in doubt about the
existence or nonexistence of some right, status, immunity, power, or privilege, that he or
she is entitled to have the doubt removed, and that there is a bona fide, actual, present,
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and practical need for the declaration. Murphy v. Bay Colony Prop. Owners Ass'n, 12
So. 3d 924, 926 (Fla. 2d DCA 2009).
Here, the Homeowners pleaded that they were in doubt about (1) their
rights under the amended restrictive covenants to freely alienate their properties without
the HHPOA's approval and (2) the legality of the HHPOA's attempt to mandate
membership in the HHPOA and to impose age restrictions within Heather Hills. The
declaration of amended restrictive covenants was recorded against the title to every lot
in Heather Hills, and while the declaration states in some places that the amended
restrictive covenants only apply to consenting lot owners, there is no indication as to
which lot owners consented. That lack of clarification is exacerbated by the fact that the
declaration also states that the consenting lot owners "do hereby impose upon the lots,
blocks, or parcels of such owners . . . and all members of [HHPOA]" the covenants,
agreements, restrictions and conditions set forth in the declaration. (Emphasis added.)
The implication then is that the amended restrictive covenants apply to all members of
the HHPOA regardless of the members' individual consent. And because there is no
explanation in the declaration as to which lot owners are members of the HHPOA, the
declaration (i.e., the exhibit attached to the complaint) does not on its face refute the
allegations of the complaint relating to the necessity for a declaratory judgment. Indeed,
when the declaration of amended restrictive covenants is read in conjunction with the
HHPOA's amended articles of incorporation—which expressly state that all lot owners in
Heather Hills shall be members of the HHPOA—the Homeowners' claim of doubt as to
their rights is reasonable. This is especially true here because the amended restrictive
covenants run with the land and the ambiguity in the declaration of amended restrictive
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covenants places a cloud on the titles of the Homeowners' lots. See Caulk v. Orange
County, 661 So. 2d 932, 933 (Fla. 5th DCA 1995) (defining a covenant running with the
land as one which binds the heirs and assigns of a covenantor).
The Homeowners also alleged that they purchased their lots prior to the
creation of the HHPOA and thus were only subject to the developer's original restrictive
covenants. This is important because the original set of covenants does not mention a
homeowners' association nor does it provide any third parties or future homeowners'
associations with the right to amend the restrictive covenants. Rather, the right to
modify or amend the restrictive covenants was expressly reserved to the developer and
its successors in interest. Because there was no express delegation of authority to the
HHPOA to amend the restrictive covenants, the restrictive covenants can only be
amended by the consent of all the property owners in the subdivision. See Roth v.
Springlake II Homeowners Ass'n, 533 So. 2d 819, 820 (Fla. 4th DCA 1988) (explaining
that subdivision restrictions "normally cannot be amended without the consent of all the
property owners" (citing Harwick v. Indian Creek Country Club,
142 So. 2d 128 (Fla. 3d
DCA 1962))). And because the Homeowners alleged that they did not consent to the
amendments, there is a legitimate question as to whether the declaration of amended
restrictive covenants was effective at all.
Consequently, we conclude that the Homeowners sufficiently stated a
cause of action for a declaratory judgment and that the trial court erred by dismissing
this count with prejudice.
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II. Claim To Quiet Title
In order to state a sufficient claim to quiet title, a plaintiff must demonstrate
(1) that he or she owns the title to the land in controversy; (2) that a cloud on the title
exists; (3) that the facts give the claim apparent validity; and (4) that the facts show that
the claim is invalid. Stark v. Frayer, 67 So. 2d 237, 238 (Fla. 1953); Woodruff v. Taylor,
118 So. 2d 822, 822 (Fla. 2d DCA 1960); see also §§ 65.021, .061, Fla. Stat. (2015).
As we have already explained, because the declaration of amended restrictive
covenants does not clearly indicate which lot owners consented to the applicability of
the amended restrictive covenants and because the declaration states that the
amended restrictive covenants are imposed on "all members of [the HHPOA]" without
any clarification as to which lot owners are members, the Homeowners' lots appear to
be subject to the amended restrictive covenants. And because the amended restrictive
covenants expressly state that they run with the land, they constitute a cloud upon the
Homeowners' titles. These facts, in conjunction with the Homeowners' allegations that
they neither consented to being members of the HHPOA nor to the imposition of the
amended restrictive covenants, sufficiently stated a cause of action for a claim to quiet
title, and nothing in the attached exhibits to the complaint refuted the claim. The trial
court therefore erred in dismissing the claim with prejudice.
III. Claim for Damages for Slander of Title
A claim for slander of title requires a plaintiff to show that (1) a defendant
published or communicated a falsehood to a third party, (2) the defendant knew or
reasonably should have known that the falsehood would likely result in inducing others
not to deal with the plaintiff, (3) the falsehood did materially and substantially induce
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others not to deal with the plaintiff, and (4) the falsehood resulted in damages that were
proximately caused by the published falsehood. McAllister v. Breakers Seville Ass'n,
981 So. 2d 566, 573 (Fla. 4th DCA 2008); Bothmann v. Harrington,
458 So. 2d 1163,
1168 (Fla. 3d DCA 1984).
The second amended complaint alleged that by filing the amended articles
of incorporation and by recording the declaration of amended restrictive covenants
which attaches to the Homeowners' lots, the HHPOA falsely declared to the public that
membership in the HHPOA was mandatory, that the HHPOA controlled the lots in
Heather Hills, that the Homeowners were mandatory members of the HHPOA due to
their ownership of lots within Heather Hills, that the Homeowners' lots were subject to
an over-55 age restriction, and that the HHPOA possesses the authority to modify or
amend the restrictive covenants. The claim for slander of title also alleged that since
2008, the defendants have posted signs at the entrance to Heather Hills and distributed
fliers falsely stating that Heather Hills is a deed-restricted community open only to
persons over the age of fifty-five. The second amended complaint also alleged that the
Homeowners were damaged by the loss of value in their lots and their inability to sell
the lots or, at the very least, convey them with clear title without having to obtain
approval of the HHPOA based on the age of the buyer.
Again, the lack of clarity in the declaration of amended restrictive
covenants results in the appearance that the Homeowners' lots are subject to the
amended restrictive covenants. Neither the public nor potential buyers would be aware
after reading the HHPOA's amended articles of incorporation and the recorded
declaration of amended restrictive covenants that the Homeowners' lots were not
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subject to the amended restrictive covenants. Further, nothing in the exhibits attached
to the complaint refute the Homeowners' allegations regarding the posting of signs and
distribution of fliers falsely promoting Heather Hills as an over-55 community.
Accordingly, the Homeowners sufficiently stated a cause of action for slander of title,
and the trial court erred by dismissing the claim with prejudice.
IV. Conclusion
The Homeowners' claims for a declaratory judgment, to quiet title, and for
damages for slander of title sufficiently stated causes of action and were not refuted by
the exhibits attached to the second amended complaint. We therefore reverse the trial
court's order dismissing the claims with prejudice.
Reversed and remanded for proceedings in conformance herewith.
VILLANTI, C.J., and NORTHCUTT, J., Concur.
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