Utah Court of Appeals
Can property owners unilaterally amend restrictive covenants with sufficient voting power? Skypark Airport v. Jensen Explained
Summary
SAA sued to enforce restrictive covenants prohibiting fuel sales in a development against defendants who began selling fuel. The trial court granted summary judgment determining SAA was successor to the original developer with enforcement rights. After a jury trial on waiver and abandonment issues, the court also ruled that a 1985 declaration constituted a valid amendment to the original 1979 declaration.
Practice Areas & Topics
Analysis
In Skypark Airport Association v. Jensen, the Utah Court of Appeals addressed whether a property owner with sufficient voting power could unilaterally amend restrictive covenants without formal voting procedures. This decision provides important guidance on covenant enforcement and amendment procedures in planned developments.
Background and Facts
The original 1979 Declaration established restrictive covenants for Skypark Industrial Park, including prohibitions on commercial aviation activities like fuel sales. The declaration specified it could be amended by a two-thirds vote of all Class A and Class B votes. In 1981, Woods Cross acquired the airport and seventy of eighty-three total Skypark lots. In 1985, Woods Cross executed a Declaration Concerning Airport Operation and Maintenance, which contained provisions “in lieu of” certain 1979 Declaration terms. SAA later acquired the airport and sued defendants for violating fuel sales restrictions.
Key Legal Issues
The primary issues were whether SAA was a successor to the original developer with enforcement rights, whether the 1985 Declaration constituted a valid amendment to the 1979 Declaration, and whether defendants had a right to jury trial on their wrongful lien claims.
Court’s Analysis and Holding
The court affirmed all trial court rulings. Regarding the amendment validity, the court determined that Woods Cross, owning seventy of eighty-three lots (approximately 84%), clearly had the votes necessary to amend under the declaration’s two-thirds requirement. The court relied on Swenson v. Erickson to conclude that signatures may be used in lieu of formal voting when one party controls the necessary majority. The “in lieu of” language in the 1985 Declaration did not preclude it from being an amendment, as amendments can involve deletions or substitutions, not just additions.
Practice Implications
This decision clarifies that when challenging covenant amendments, practitioners should focus on the specific voting requirements in the original declaration rather than demanding formal voting procedures when one party controls the necessary majority. The court’s analysis of “in lieu of” language demonstrates that amendments can validly replace provisions rather than merely add to them. Additionally, the decision reinforces that wrongful lien claims present legal questions for the court, not factual issues for juries.
Case Details
Case Name
Skypark Airport v. Jensen
Citation
2013 UT App 229
Court
Utah Court of Appeals
Case Number
No. 20110648-CA
Date Decided
September 19, 2013
Outcome
Affirmed
Holding
A property owner who acquires seventy of eighty-three lots in a development and executes an amendment to the original declaration has sufficient voting power under the declaration’s terms to unilaterally amend restrictive covenants, even without formal voting procedures.
Standard of Review
Correctness for summary judgment rulings and legal conclusions; abuse of discretion for determination of whether an issue is legal or equitable
Practice Tip
When challenging the validity of covenant amendments, focus on the specific voting requirements and procedures mandated by the original declaration rather than arguing about formal voting processes when one party controls the necessary majority.
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