Failure To Enforce Can Have Sweeping Consequences

A Texas Court of Appeals has found that the failure to enforce a subdivision’s restrictive covenants constituted an abandonment of the restrictions as a whole — despite the fact that the covenants included a severability provision intended to protect the other provisions if one or more were struck down as unenforceable.

“I’ve defended associations in cases that were unwinnable because of lack of enforcement,” says Marc Markel, a shareholder in the Texas-based law firm Roberts Markel Weinberg Butler Hailey PC. “But I don’t usually see waiver of a whole set of restrictions.”

The subdivision in the case didn’t have a community association, but the court’s ruling nonetheless is a good illustration of the risks to associations of lax enforcement.

In January 2016, the McCarleys bought a home on a 15-acre tract in a subdivision with 43 lots. They chose the property because they wanted to open a dog-breeding business and live on the same property. They built two buildings at a cost of $360,000 and launched operations in June 2016.

About five months later, Sherry Densmore, another resident in the subdivision, sent the McCarleys a letter stating they were violating three of the 13 prohibitive deed restrictions governing all properties. The specific restrictions barred:

• The keeping of swine and use of the property for a commercial feed lot for livestock or fowl or a dog or cat kennel,
• Noxious or offensive activity that may be or become an annoyance or nuisance to the neighborhood, and
• Certain businesses.

The restrictions included a severability clause: “Invalidation of any of these covenants by judgment or court order shall in no wise affect any of the other provisions which shall remain in full force and effect.” They also authorized any property owner to sue for injunctive relief to enforce the restrictions.

Densmore and several other owners eventually sued the McCarleys, seeking an injunction blocking the operation of the kennel business. The McCarleys argued that the owners had waived and abandoned the deed restrictions because they hadn’t enforced them in the past. The trial court agreed and awarded the McCarleys their attorneys’ fees and costs. The owners appealed.

Learn how it turned out, and how to protect your association: Use It or Lose It: Failure to Enforce Wipes Out Entire Set of Restrictions

Best regards,
Matt Humphrey
President