What if a covenant or condition or restriction has been broken by by multiple parties in a subdivision and nothing has been said?

Answer 1

Enforcing a covenant, condition and/or restriction ("CCR") for subdivisions (or for that matter any other multiple ownership situations) typically occurs one of two ways: through direct home owner action or, if there is a home owner association, through a complaint to the association. The best way to illustrate how is by example.

Assumptions:

1. The CCR is a 50' front yard setback or building line THAT APPEARS ON THE PLAT OF SUBDIVISION, meaning all homes in the subdivision are supposed to be set back at least 50' from the street right of way, for some kind of uniformity/consistency of "street view". Everyone who buys into the subdivision is supposed to receive a survey at closing and that the survey is supposed to, and does, show the setback line. Assume this is legal.

2. Assume you were the first buyer and your builder followed the setback and your home is 50' from the street right of way. Assume there is no other CCR violated by your home. Lucky you.....

3. Assume the next buyer builds their home 60' feet back. Since 50' is the minimum, this is ok. Lucky them......

4. Assume the next two buyers build their homes 40' back (they want larger back yards or want their garages to extend toward the street, or some other reason, or the contractor who built their home made a mistake). Assume garages are considered part of the house for purposes of calculating the setback. THIS 10' DEVIATION IS THE ISSUE.

A. With nothing more, every home owner in the subdivision customarily should have the right to enforce the CCR, through legal action. Why? Because it is on the plat of subdivision, meaning it is applicable to everyone and every lot in the subdivision. CCRs like this act like an "implied contract" for everyone buying into the subdivision, so that if anyone in particular breaches the CCR, any homeowner, individually or on behalf of all of the homeowners, would have the right to seek enforcement. Local laws may provide some limitations or particulars on this kind of right and the process to enforce it. The problem is that the home may already have been built. Making a homeowner tear it down will not be a happy thing. Frankly, even if it is only a foundation can be a huge issue although some states' courts may be more willing to strictly enforce CCRs if they are only part of the way. In this case, assuming the subdivision developer/seller is still around, it may be responsible for the situation, because local laws may impose the obligation on the "majority" owner, maybe not and everyone is on their own. So it may be too late to go after the homeowner but not for the developer, and the question one must consider is the measure of damages. It may be that the homeowners sue the buyer, a court may or may not strictly enforce the CCR, and if so (or if the court awards some kind of money damages) the buyer whose home violates the CCR may have their own lawsuit against the developer if the developer somehow approved the violation.

B. ASSUME FURTHER THE SUBDIVISION NOT ONLY HAS A PLAT WITH THE 50' LINE ON IT, BUT IS TO BE GOVERNED BY A HOME OWNERS ASSOCIATION ("HOA") THAT IS INVESTED WITH THE SOLE RIGHT AND OBLIGATION TO ENFORCE CCRs ON THE PLAT....At this level the HOA generally will have the only power to enforce the CCR. But early enough in the development the developer itself may control the HOA and therefore the home owners who are impacted by the violation should have recourse. Local law may require the buyer owners to first try to make the developer correct the situation and if not then be able to take some legal action. Other local laws may allow direct action; one such action is to force the developer in control of the HOA to enforce the CCR under a theory of "breach of fiduciary obligation" which means that because the developer set up the CCR and the HOA, and controls it (the key point), it has a special obligation to all the buyer owners to properly administer the HOA and enforce CCRs.

C. PS - if the developer is also building the homes, it may have "double" liability because there is no way it should not have known of its own CCR and may be liable directly.

D. PPS - the local building department may have some liability if they ok'd the placement of the home in violation of the CCR. As to the government, about the only thing you can possibly hope for is strict enforcement of zoning requirements for private subdivisions and that they deny a certificate of occupancy but most courts have held that where an innocent party builds in violation of some governmentally regulated matter like this the government will be estopped from denying an occupancy certificate.

E. Regardless, whenever the violating home owners attempt to finance, refinance or sell their homes, they will run into contract, title insurance and home owner insurance problems that may never go away and cost a lot of money: the home is considered "non-conforming" and if the home burns it is possible it can not be rebuilt where it was, title insurance will raise it because the government may change its laws later and be able to prevent additions to the home or other building permits to enhance it, and buyers and lenders may be frightened off.