Tennessee Ct. Refuses to Enforce Ambiguous HOA Restriction re Parking of Commercial Trailer

Tennessee Appellate Court decision (June 23, 2016).

In this case, a homeowners association (“Association”) brought suit against a homeowner (“Owner”) seeking to enjoin her from conducting commercial activity at her home and from parking a commercial trailer on the property. At issue were the following two provisions contained in the Association’s governing documents that were alleged to have been violated by Owner:

First provision prohibiting commercial activities:

• No commercial, industrial, recreational or professional activity as defined in any applicable Zoning Ordinance shall be pursued on any Unit at any time.

Second provision prohibiting parking of certain vehicles:

• No Owner or occupant shall leave any non-operating vehicle, trailer, boat, camper, commercial vehicle, any vehicle not currently registered and licensed or any vehicle having invalid and expired state motor vehicle inspection sticker on or about the Property except if entirely enclosed in a garage.

Owner admitted to engaging in the following activities as alleged by the Association, but Owner contended that they did violate the above provisions of the Association’s governing documents:

• Bringing a commercial trailer to her home for use in her catering business;
• Organizing items in the trailer;
• Cleaning out the trailer to meet health code inspections;
• Transferring food items, platters, and cleaning materials from the residence to the trailer.

The court disagreed with Owner’s contentions regarding the first provision and ruled in favor of the Association finding that the above activities were commercial activities in violation of Associations governing documents. Notwithstanding same, the court ruled in favor of Owner on the Association’s claim that parking the trailer on Owner’s property violated the above-quoted second provision of the Association’s governing documents because courts refrain from extending restrictive covenants to activities that ae not “clearly and expressly prohibited” by the covenant’s plain terms. The court stated that when restrictions could be reasonably interpreted more than one way, courts will adopt a construction that advances the unrestricted use of the property and resolve ambiguities and doubts concerning a covenant’s applicability against the party seeking to enforce the covenant. Interpreting the language in the restriction in a manner deemed to be the least restrictive use of Owner’s property, the court ruled that the term “non-operating” as contained in the above-quoted second provision applies to all of the vehicles mentioned in the restriction, and because Owner’s trailer was operable at all times, there was no violation of that provision of the governing documents.

See case decision: Brentwood_Chase_Cmty._Ass’n_