Kiekel v. Four Colonies Homes Association

Kansas Court of Appeals · Property

PropertyRestrictive covenantsHomeowners associationsBylaws vs. declarationInjunctive reliefHOAdeclarationbylaws

Facts

Four Colonies is a planned-unit-development association whose recorded Declaration contains property use restrictions and may be amended only by an instrument signed by at least 75% of lot owners, while its Bylaws may be amended by a majority vote of owners present at a meeting. In 2004, by a 191-181 vote at a special meeting attended by 372 of 681 owners, Four Colonies adopted a bylaw amendment that sharply restricted future renting, required annual board approval of leases, and authorized lease termination and tenant eviction for noncompliance. The Kiekels owned eight lots that they rented and filed for declaratory judgment after Four Colonies sought tenant information under the new bylaw. Four Colonies counterclaimed for an injunction, arguing the rentals violated the Declaration's commercial-use and noxious-activity restrictions.

Issue

Could Four Colonies impose post-purchase rental restrictions on lot owners through an amendment to its Bylaws rather than through an amendment to its Declaration? Separately, did the Kiekels' renting of their properties violate the Declaration's commercial-use or noxious-activity restrictions so as to justify injunctive relief?

Rule

In a homeowners association, the declaration is the enabling document that sets out fundamental ownership and property rights, while bylaws generally govern internal operation and procedure. Absent a specific delegation in the declaration, new property use restrictions that impair or diminish owners' use and enjoyment of their real property must be enacted through an amendment to the declaration, and restrictive covenants are strictly construed in favor of the unrestricted use of property. Also, where a declaration contemplates tenants and the premises are used residentially, earning rental income does not by itself amount to commercial use of the property.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Tulsa, the recorded declaration for Red Mesa Courtyard states that lot-use restrictions are contained in the declaration and may be amended by 80% of all owners. The bylaws, amendable by a majority of those present at a meeting, are later changed to require board approval before any owner may lease a unit and to authorize the association to cancel nonapproved leases.

If an owner challenges the new leasing rule, what is the strongest argument against its enforceability?

Explanation. The majority opinion treats the declaration as the association’s enabling document and constitution, while bylaws generally govern internal operation and procedure. A rule requiring board approval for leases and allowing lease cancellation impairs owners’ use and enjoyment of their real property, so it is a substantive property-use restriction. Absent specific delegating language in the declaration, such a restriction must be adopted by amending the declaration, not merely the bylaws. (Derived from Kiekel v. Four Colonies Homes Association (n.d.).)