Condominium declaration cannot be altered solely by individual deed or private agreement.

Madowitz and Kohl v. The Woods at Killington Owners' Association (2008-502) (02-Jul-2010) 2010 VT 37 (Johnson, J.) (Dooley, J., dissenting joined by Joseph, D.J., Specially Assigned)
This interlocutory appeal arises out of a dispute over development rights at a condominium complex. An association of condominium unit owners appeals from a decision by the Superior Court granting summary judgment in favor of plaintiff developers who are seeking to further develop the project without obtaining written consent from each unit owner. The question on appeal is whether development rights created under declaration can be cut off by a ten-year durational limitation created by 105 of the 107 conveyances from the original developer to unit owners and by two separately executed limited powers of attorney. We conclude that because the declaration cannot be altered solely by individual deed or private agreement, developers’ rights to develop the project have not expired and that the superior court was correct in granting summary judgment in favor of developers.

Pursuant to 27 V.S.A. § 1306(b), a developer needed consent from each unit owner before he could alter the percentage of undivided interest held by each owner. Instead of procuring consent from each unit owner prior to each and every addition to the development, to comply with former § 1306(b), the developer included the following provision in the original 1985 declaration as a way to obtain prior consent from each unit owner:

[B]y acceptance of deeds of their Units, Unit Owners shall be deemed to have designated and appointed Declarant as their attorney in fact for the sole, limited and exclusive purpose of amending this Declaration in accordance with this section, so that an Amendment filed by Declarant pursuant hereto shall result in the amendment and reduction of such fractional interest without further action or consent by Unit Owners . . . .

This provision effectively provided unit owners’ consent to future project additions that would result in reductions of each owner’s percentage interest in the common areas. Though 27 V.S.A. § 1306 was later amended to prohibit the practice of obtaining prior consent to development in this manner there is simply no way to construe § 1306, as it appeared at the time the deeds of condominium were conveyed, as prohibiting this practice.]

A declaration or “master deed” effectively trumps individual deed restrictions. The declaration provisions directly conflict with the ten-year limitations found in 105 of the 107 deeds of condominium and two separately executed powers of attorney. There is simply no harmonious way to read these conflicting provisions, and we will not inject ambiguity into otherwise unambiguous provisions. The unambiguous language of the declaration explicitly gave developers the right to continue with their phased development plans



Dooley, J., dissenting joined by Joseph, D.J., Specially Assigned : I concur with Justice Mahady’s sentiment, expressed roughly twenty years ago, that “[t]he law should be more solicitous of . . . innocent consumers than of the tortfeasor-developer.” Meadowbrook Condo. Ass’n v. Burlington Realty Corp., 152 Vt. 16, 29, 565 A.2d 238, 245 (1989) (Mahady, J., concurring and dissenting). Because the Vermont Condominium Ownership Act, at its heart, is a consumer protection statute, the condominium owners should prevail on their claim that developers cannot dilute their share of the common area without their consent. The majority mistakenly treats this case as if it involved a conflict between condominium unit owners, or between unit owners and the condominium owners’ association. Instead, this is a conflict between the condominium owners and developers. The flaw in the majority’s decision and rationale lies in its statement that there is a “discrepancy between the declaration and the deeds and powers of attorney.” Rather than acting on this discrepancy with solicitude toward the innocent consumers, the majority enables developers to perpetrate a consumer fraud on the condominium purchasers, thus endorsing conduct that is outside the “spirit of fairness, justness, and right dealing.” Starr Farm Beach Campowners Ass’n, Inc. v. Boylan, 174 Vt. 503, 507, 811 A.2d 155, 160 (2002) (mem.) (quotation omitted).