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Lee v. Willow Creek Ranch Estates No. 2 Subdivision Homeowners' Association, Inc.

Supreme Court of Idaho

November 28, 2018

DALE LEE and KATHI LEE, Husband and Wife, Plaintiffs-Appellants,
v.
WILLOW CREEK RANCH ESTATES NO. 2 SUBDIVISION HOMEOWNERS' ASSOCIATION, INC., an Idaho corporation, Defendant-Respondent, and DOES I-X, inclusive, Defendants.

          Appeal from the District Court of the Third Judicial District of the State of Idaho, Canyon County, Hon. Christopher S. Nye, District Judge.

         The judgment of the district court is affirmed.

          Morris Bower & Haws, PLLC, Boise, for Appellants. Daniel W. Bower argued.

          Elam & Burke, PA, Boise, for Respondent. Matthew C. Parks argued.

          HORTON, Justice.

         Dale and Kathi Lee appeal the district court's decision granting summary judgment in favor of Willow Creek Ranch Estates No. 2 Subdivision Homeowners' Association, Inc. (the HOA). The dispute between the Lees and the HOA involves a 1997 agreement (the Agreement) that purportedly grants the Lees three access points to a private road owned by the HOA. The Lees conceded in the district court that the Agreement alone does not create an enforceable easement. The Lees asserted, however, that an easement exists based on the doctrine of part performance or that an enforceable encumbrance exists through the doctrine of equitable servitudes. The district court determined that neither the doctrine of part performance nor the doctrine of equitable servitudes were applicable to this case and granted the HOA's motion for summary judgment. We affirm.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         The Lees and the Kemp Family Trust (Trust) owned adjoining property in Canyon County. The Lees and the Trust both contemplated future development of their property. To further its plans for development, the Trust desired to purchase land from the Lees to develop the Willow Creek Ranch Estates No. 2 subdivision (Subdivision). On June 1, 1997, the Lees and the Trust executed the Agreement for the sale of the property. The Agreement states that "[the Lees] shall also be entitled to 3 driveway accesses from the gravel road to be constructed by [the Trust] adjoining [the Lees'] property. Such accesses shall be constructed at [the Lees'] cost and subject to [the Lees] obtaining any necessary government approvals." The gravel road referenced in the Agreement ultimately became Kemp Road. The Agreement was signed by the Lees and by an individual purportedly representing the Trust. The Agreement does not contain a legal description of the land or the three "driveway accesses" from the gravel road. The Agreement was never recorded.

         In August 1997, the Lees executed a warranty deed granting ownership of the land to the Trust. The warranty deed does not reference or incorporate the Agreement, nor does it reference or reserve an easement for the Lees to access the gravel road mentioned in the Agreement. The warranty deed contains the following covenant:

[S]aid premises are free from all encumbrances, EXCEPT those to which this conveyance is expressly made subject and those made, suffered or done by the Grantee(s); and subject to reservations, restrictions, dedications, easements, rights of way and agreements, (if any) of record . . . and that Grantor(s) will warrant and defend the same from all lawful claims whatsoever.

         The Trust recorded the plat for the Subdivision in December 1998. The Trust recorded the Declaration of Covenants, Conditions, and Restrictions and Neighborhood Association (CC&Rs) for the Subdivision in April 1999. The Subdivision plat and the CC&Rs do not reference an easement or any other right for the Lees to access Kemp Road.

         The Trust constructed Kemp Road in 2000. The Trust paid to create three access points from Kemp Road to the Lees' property. This construction included culverts and the placement of gravel extending from Kemp Road to the Lees' property. Wood fencing and metal gates were constructed along the three access points from Kemp Road.

         In April 2005, the Trust executed a warranty deed granting ownership of Kemp Road and other common areas to the HOA. The warranty deed does not expressly reference or reserve an easement for the Lees to access the gravel road mentioned in the Agreement. The warranty deed states that the Trust "does hereby grant, convey, release to the [HOA] the following-described premises with all appurtenances and subject to all existing easements and rights-of-way of record or implied[.]"

         Alan Mills served on the board of directors of the HOA at the time the Trust transferred ownership of Kemp Road to the HOA. Mills was also the Trust's real estate agent at the time of the Agreement. Mills stated: "As a former HOA board member, I can say with a high degree of certainty that the HOA at that ...


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