Can plat amendments terminate restrictive covenants in recorded declarations? The View Condominium Owners Association v. MSICO Explained

In The View Condominium Owners Association v. MSICO, the Utah Supreme Court addressed whether a plat amendment that reconfigures lot boundaries can terminate restrictive covenants contained in a recorded declaration. The court’s analysis provides important guidance for practitioners handling property disputes involving planned developments.

Background and Facts

The Sugarplum Planned Unit Development was governed by a recorded Declaration of Covenants that designated lot 5 for parking and lot 9 for snow storage. Developer Sorenson later recorded an amended plat that reconfigured the lots’ boundaries and eliminated the parking designation for lot 5 in the plat’s density table, but failed to amend the Declaration. When MSI acquired the lots and sought to build homes, The View sued to enforce the restrictive covenants and claimed Alta’s revised snow storage plan constituted a regulatory taking.

Key Legal Issues

The court addressed two primary questions: (1) whether the plat amendment terminated the restrictive parking covenant for lot 5, and (2) whether Alta’s modification of the snow storage plan constituted a compensable constitutional taking under article I, section 22 of the Utah Constitution.

Court’s Analysis and Holding

The Supreme Court reversed the court of appeals on both issues. Regarding the parking covenant, the court emphasized that restrictive covenants are interpreted like contracts using plain language when unambiguous. The Declaration expressly stated that covenants would “run with the land” and applied to lots “as shown on [the plat] as the same may be amended from time to time.” Critically, the court found no inconsistency between the amended plat and the Declaration, noting that the Declaration contemplated both parking and air space development on lot 5. The plat amendment merely reconfigured boundaries without eliminating the parking requirement.

On the takings claim, the court applied the established test requiring both a protectable property interest and substantial interference with that interest. While acknowledging The View’s property interest in lot 8, the court found that Alta’s revised snow storage plan—which increased costs but provided alternative storage locations—did not “substantially interfere” with The View’s use and enjoyment of its property. The court emphasized that mere increased costs from municipal regulations do not constitute compensable takings absent substantial interference with property rights.

Practice Implications

This decision reinforces several key principles for Utah practitioners. When analyzing whether plat amendments affect restrictive covenants, courts will examine whether the documents can be harmoniously construed rather than finding automatic termination. The ruling also clarifies that regulatory takings require substantial interference with property rights, not merely increased compliance costs. For developers and property owners, the case underscores the importance of formally amending declarations when intending to modify restrictive covenants, as plat amendments alone may be insufficient to eliminate recorded restrictions.