Appeal from the Circuit Court of the 13th Judicial Circuit, Grundy County, Illinois, Appeal No. 3-12-0319 Honorable Lance R. Peterson, Judge, Presiding.
The opinion of the court was delivered by: Justice Holdridge
JUSTICE HOLDRIDGE delivered the judgment of the court, with opinion. Justices McDade and Schmidt concurred in the judgment and opinion.
¶ 1 Does a homeowners association have the inherent power to make and enforce reasonable rules regarding the use of common areas if the recorded covenants do not expressly grant that authority to the association? We find that a homeowners association does have implied or inherent authority to regulate the use of common areas even where the recorded covenants do not expressly grant the authority to regulate the common areas.
¶ 2 The plaintiff, Kirk Ripsch (Ripsch), appeals from a judgment of the circuit court of Grundy County denying his petition for declaratory judgment following a stipulated bench trial. In his petition, the plaintiff sought to enjoin the defendant, Goose Lake Association (the Association), from enforcing a rule prohibiting the use of Tritoon boats on the lake. Tritoon boats are large pontoon boats which rest on three pontoons rather than the usual two pontoons. Ripsch maintains that the Association has no authority to establish rules governing the use of the lake since the recorded covenants contain no authorization granting the Association any rule making authority. The Association maintains that it has implicit authority to regulate the use of the lake as common property, subject only to the requirement that its regulations be reasonable. For the following reasons, we affirm the order of the circuit court.
¶ 4 Ripsch owns a single-family residence on a parcel which abuts a body of water known as Lincoln Lake; however, he does not own any part of Lincoln Lake. Ripsch purchased the property on June 23, 1979. By virtue of his purchase, Ripsch became a member of the Goose Lake Association. The Association is a common interest community comprised of homeowners living on or adjacent to Goose Lake, Beaver Lake, Half Moon Lake, and Lincoln Lake in Grundy County. The lakes, including Lincoln Lake, appear to be common areas controlled by the Association. Only property owners are members of the Association and enjoy the privilege of attending membership meetings and voting for members of the Association's board of directors.
¶ 5 At the time that Ripsch purchased his property, the only recorded document containing restrictions on his use of the property was a document titled "Protective Covenants and Restrictions" recorded August 17, 1971. The document, only two pages in length, contained a list of general restrictions on the use of each property owner's own land. Only one of the listed restrictions addressed the use of the lake: "9. No boat pier may extend more than two (2) feet into the waters of the lake." The document also stated: "10. Each property owner becomes an Associate Member of the Goose Lake Association upon purchase and shall maintain said membership by payment of an annual maintenance charge, not to exceed $25.00, unless said maintenance charge is increased by a vote of the members and associate members of the Association."
¶ 6 The Association enacted and published a set of bylaws as required by the General Not For Profit Corporation Act of 1986. 805 ILCS 105/102.25 (West 2010). Although these bylaws were published to the membership and periodically updated, the bylaws and subsequent amendments were never recorded. At the time Ripsch purchased his property, he was provided a copy of the bylaws and the Association rules in effect on the date of purchase. The record contains a copy of the bylaws dated September 16, 2006. Article II, section XIV, of the bylaws provided that "all members are bound by the current Goose Lake Association Rules." At various times during Ripsch's membership in the Association, the board of directors promulgated and published to the membership certain rules purporting to regulate activities on the lakes and other common areas. These rules addressed such activities as fishing, swimming, boating, camping, and guest usage. The stated purpose of these rules was to promote safety on the lakes and waterways and in the community, prevent over-fishing and crowding on the water, and provide an overall order to the use of the lake and other common areas.
¶ 7 Sometime during December 2007, the Association amended its rules to prohibit the use of pontoon boats with more than two pontoons on Lincoln Lake. When Ripsch was informed of the rule limiting pontoon boats on Lincoln Lake, he informed the Association's directors that he intended to use a Tritoon boat (a boat with three pontoons) on Lincoln Lake.
The Association responded that it would enforce its rules through fines and/or expulsion from the lake. The instant litigation ensued.
¶ 8 Following a hearing, the trial court ruled in favor of the Association. The court observed that no Illinois precedent existed to answer the specific question raised by the instant litigation, i.e., whether a homeowners association's rules and regulations regarding the use of common property must be contained in recorded covenants in order to be enforceable. The court, sua sponte, looked to the Restatement (Third) of Property: Servitudes. Specifically, comment b of section 6.7 of the Restatement provides that "[e]ven in the absence of an express grant of authority, an association enjoys an implied power to make rules in furtherance of its power over the common property." Further, the trial court observed that the Restatement stated that "[e]xcept as limited by statute or the governing documents, a common-interest community has an implied power to adopt reasonable rules to *** govern the use of common property." Restatement (Third) of Prop: Servitudes § 6.7(1)(a) (2000). The trial court noted that the Restatement is not binding on Illinois courts but has been found to be persuasive. The court held that, under the analysis articulated in the Restatement, the facts in the instant matter established that the Association enacted the rule limiting the size of pontoon boats on Lake Lincoln in its authority to impose reasonable restrictions on the use of common property. The court held that Ripsch had not challenged the reasonableness of the rule, but only the Association's power to adopt it. The court held that the Association had the implicit power to enact the rule. Ripsch brought this appeal.
¶ 10 At issue is whether the Association may enforce a rule adopted by its board of directors which placed a limitation upon an owner's use of the common property. Ripsch maintains that, under Illinois law, a homeowners association may not restrict the use of any property unless the restriction is expressly contained in the recorded declarations and bylaws. He cites Krueger v. Oberto, 309 Ill. App. 3d 358, 369 (1999), for the proposition that a restriction upon the use of property must be recorded and made a part of the chain of title to the property in order to be enforced. He further maintains that any recorded restriction on the use of property recorded after the conveyance of that property is not binding upon the grantee. Cimino v. Dill, 92 Ill. App. 3d 345, 349 (1980). As the matter involves the ...