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Orchard Brook Home Ass'n v. Keim Land Dev.





APPEAL from the Circuit Court of Du Page County; the Hon. EDWIN DOUGLAS, Judge, presiding.


Defendant, Joseph Keim Land Development Corporation, appeals from a judgment entered against it for $16,609.63 in favor of plaintiff, Orchard Brook Home Association, Inc., in an action brought by plaintiff seeking to enforce the payment of subdivision assessments against land owned by defendant. Defendant contends (1) that it is a "declarant" and thus exempt from the payment of assessments; (2) that, in any event, such assessments may not be applied to the type of property it owns; (3) that plaintiff failed to follow the prescribed procedures for imposing the assessment; and (4) that plaintiff has waived its right to enforce the subdivision convenient permitting assessments and is estopped from doing so.

Daniel E. Harper, a land developer, acting through the D. Harper Corporation, purchased approximately 137 acres of land in 1963 located within the Village of Downers Grove. Harper's plans to subdivide the property for residential development were approved by the village and on December 11, 1964, a "Declaration of Covenants and Restrictions" was filed by the D. Harper Corporation in the office of the recorder of deeds of Du Page County. The terms of the declaration essentially determine the resolution of the issues presented in this appeal.

The preamble of the declaration stated that the D. Harper Corporation, referred to therein as declarant, was the owner of the property and desired to create a residential community with parks and playgrounds, open spaces and common facilities for the benefit of the property and each owner thereof. In order to provide such common areas and facilities it stated that the property would be subject to covenants, restrictions, easements, charges and liens and it further provided for the creation of an agency, to be incorporated by declarant, known as the Orchard Brook Home Association (hereinafter referred to as the Association), plaintiff herein. The function of the Association, as provided in the declaration, was to maintain and administer the common areas and facilities and to enforce the covenants and restrictions imposed by the declaration. The assignment of authority to the Association by the declarant included the power to impose and collect assessments on the property as may be necessary to construct and maintain the common areas and facilities. It also provided that the declarant would convey land to be used for the common areas to the Association for those purposes. Subject to certain exemptions from assessment, hereinafter described, each and every purchaser of a lot by acceptance of a deed covenanted and agreed to pay to the Association the assessments made by it, pursuant to the declaration, for the described purposes.

The D. Harper Corporation thereafter subdivided and sold substantial portions of the land owned by it and covered by the terms of the declaration, primarily to other developers and builders. The properties which are the subject of this litigation were sold to a development group known as Kiney, Sproat and Fitzsimmons and consisted of 23 subdivided lots and certain unplatted tracts of land. These developers further subdivided the land they had purchased into unit areas known as Orchard Brook, Orchard Brook North, Orchard Brook West and Orchard Brook South and developed them in accordance with the plan which had been previously approved by the Village of Downers Grove for the D. Harper Corporation. Kiney, Sproat and Fitzsimmons also sold lots to other builders and over 100 of such subdivided lots were purchased by the defendant, Joseph Keim Land Development Corporation.

The Association was incorporated by Harper in 1965 as a not-for-profit corporation as provided in the declaration. In 1967 the Association adopted resolutions imposing assessments on all subject property and again in 1971 it adopted a resolution levying a $150 assessment on each lot owned by builders, including defendant. The resolution provided that the assessment was payable commencing one year after a lot was acquired or building thereon commenced, whichever came first. Defendant declined to pay the assessments claimed due from it by the Association and this litigation followed.

Defendant initially contends that the lots it owns within the territory subject to the covenants and restrictions of the declaration are exempt from assessment as defendant is a declarant under the terms of that document. Article I, section 1(g) defines a declarant as follows:

"The term `Declarant' as used herein shall be deemed to include the D. HARPER CORP. and also any individual person, firm or corporation, who acquired from the D. HARPER CORP. by acceptance of Deed or Deeds therefor a minimum of ten (10) lots at the same time or in a single transaction, within The Properties. Such acquisition must be made by a single entity and the conveyance must consist of at least ten (10) lots to such entity prior to such entity qualifying as declarant."

Article IV, section 11 then describes those properties which shall be exempt from the assessments, charges and liens created by the declaration as including "(a) All properties owned by Declarant."

Defendant argues that the benefit of the exemption from paying assessments attached as a covenant to the land and was then conveyed by the D. Harper Corporation to the partnership of Kiney, Sproat and Fitzsimmons by deeds which granted all right, title and interest in the subject property, including the exemption appurtenant thereto. Defendant asserts it then acquired the property from Kiney, Sproat and Fitzsimmons exempt from the covenant to pay assessments. (Bloomington Lodge No. 281 v. Roland (1920), 217 Ill. App. 435, 439-40; Keogh v. Peck (1925), 316 Ill. 318, 147 N.E. 266.) Plaintiff, however, contends the exemption established by the declaration was personal to those described therein as declarants and did not attach to and run with the land to subsequent owners.

• 1 In the absence of ambiguity, a court must seek to construe a contract or other document to give effect to the intent of its maker (Richards v. Liquid Controls Corp. (1975), 26 Ill. App.3d 111, 120, 325 N.E.2d 775, 781; Kessler v. Palmeri (1972), 3 Ill. App.3d 901, 904, 278 N.E.2d 813, 816) and will apply the everyday meaning of the language used therein to that end. In our view, the provisions of the declaration with which we are concerned are not ambiguous in the terms by which they limited the benefit of the exemption from paying assessments solely to the original developer, D. Harper Corporation, and to any person, firm or corporation who acquired "from the D. HARPER CORP. by acceptance of Deed or Deeds therefor" 10 lots, or more, in a single transaction. D. Harper Corporation and those to whom it made such a conveyance were classed as declarants by definition of article I, section 1(g) of the declaration and properties owned by such a declarant were exempted from assessments by article IV, section 11(a).

• 2 It is apparent the properties owned by defendant do not enjoy the exempt status urged as defendant did not acquire them directly from D. Harper Corporation and is not a declarant as defined by the declaration. D. Harper Corporation, in providing for exemptions from assessments, carefully limited them by the terms of the declaration to itself and to those parties to whom it made a direct major sale of land. The exempt status does not purport to attach to or benefit the land but, instead, is a personal exemption inuring to the benefit of those described categories only. (See Mangini v. Oak Park Trust & Savings Bank (1963), 43 Ill. App.2d 318, 323, 193 N.E.2d 479, 481; Fox Lake Hills Property Owners Association v. Fox Lake Hills, Inc. (1970), 120 Ill. App.2d 139, 145, 256 N.E.2d 496, 499.) Defendant's argument that the exemption granted by the declaration was intended to establish a covenant benefiting the land and, therefore, run to the benefit of subsequent owners of the land loses vitality when it is noted that D. Harper Corporation owned all the land when the declaration was filed. One might then also argue that all of the land was exempt from assessment and wonder to what purpose the original owner filed the declaration.

Nor are we persuaded by the general provision of article VI, section 3 of the declaration that D. Harper Corporation intended the exemption from assessments to pass from the declarants to all subsequent owners of the land. Section 3 states "[t]he covenants and restrictions of this Declaration shall run with and bind the land, and shall inure to the benefit of and be enforceable by ORCHARD BROOK HOME ASSOCIATION, or the Owner of any land subject to this Declaration * * *." To hold as defendant urges would absolutely defeat the purpose of the declaration to provide and maintain parks, playgrounds, open spaces and other common facilities. The assessments which defendant seeks to avoid are, of course, the only means by which these facilities are provided. As we have previously suggested, to extend the exemption beyond declarants to all the land and its successive owners would be to nullify the declaration. That, certainly, was not the intent of its maker and we will not so hold. Kessler v. Palmeri (1972), 3 Ill. App.3d 901, 278 N.E.2d 813.

Defendant contends also that the property owned by it is not of the type made subject to ...

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