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Affirmed and Memorandum Opinion filed March 28,
2006.
In
The
Fourteenth
Court of Appeals
____________
NO. 14-05-00571-CV
____________
DUANE
RUTHERFORD AND DARLINE RUTHERFORD,
Appellants
V.
On
Appeal from the 270th District
Court
Harris County,
Texas
Trial
Court Cause No. 04-58850
M E M O R
A N D U M O P I N I O
N
Appellants
Duane and Darline Rutherford are homeowners in the Greenwood Forest
subdivision in Houston. They
sued appellees Greenwood Forest Fund Inc. d/b/a Greenwood Forest Property
Owners Association (AGreenwood@) and
Millard A. Norred, Kenneth H. Latimer, Fay L. Gee, John Stofer, and Warren
J. Carroll, who are the members of the Greenwood Forest Property Owners
Assocation=s Board of
Directors,[1]
to stop the proposed sale of a piece of land in the Greenwood Forest
subdivision. Both parties
filed motions for summary judgment, and the trial court granted
appellees= motion
and denied the Rutherfords=
motion. In two issues, the
Rutherfords argue that the trial court erred in granting summary judgment
for Greenwood. We affirm.[2]
Background
The
property known as Reserve C is located in the Greenwood Forest subdivision
and contains a club house, tennis courts, and other recreational
facilities for subdivision residents and their guests. Reserve C was formerly owned by
the Greenwood Forest Residents Club, Inc., but in December 1998, that club
merged into the Greenwood Forest Property Owners Association, as reflected
in articles of merger, and title to Reserve C passed to the Property
Owners Association.
In 2004,
Greenwood proposed to sell a portion of Reserve C to the Champions Area
Volunteer Fire Department, which already had a fire station on a different
portion of Reserve C. The
Rutherfords opposed the sale and filed suit to stop it, arguing that
Greenwood had no authority to sell the property unilaterally. After both sides moved for summary
judgment, the trial court granted Greenwood=s motion
and denied the Rutherfords= motion,
stating, AThe Court
finds that Defendants are vested with the authority to sell all or a
portion of Reserve C . . . .@ This appeal
followed.
Standard of
Review
The
summary judgment movant has the burden to show that no genuine issue of
material fact exists and that it is entitled to judgment as a matter of
law. Tex. R. Civ. P. 166a(c); Nixon
v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548 (Tex. 1985). When both sides move for summary
judgment and the trial court grants one motion and denies the other, the
reviewing court should review the summary judgment evidence presented by
both sides and determine all questions presented. Comm=rs Court
v. Agan, 940
S.W.2d 77, 81 (Tex. 1997).
The reviewing court should then render the judgment the trial court
should have rendered.
Id.
Analysis
In their
first issue, the Rutherfords argue that Greenwood has no authority to
unilaterally sell all or part
of Reserve C because it is ACommon
Area@ under
Greenwood=s
governing documents. Section
204.010 of the Texas Property Code sets forth powers of
homeowners=
associations, including the following:
(a) Unless otherwise provided
by the restrictions or the association=s articles of incorporation
or bylaws, the property owners= association, acting through
its board of directors or trustees, may:
. . .
(20) exercise other powers
that may be exercised in this state by a corporation of the same type as
the property owners= association;
and
(21) exercise other powers
necessary and proper for the governance and operation of the property
owners=
association.
(b) Powers enumerated by this
section are in addition to any other powers granted to a property
owners= association by this chapter
or other law.
Tex.
Prop. Code Ann.
'
204.010(a)(20)B(21), (b)
(Vernon Supp. 2005). As a
non-profit corporation, Greenwood also has powers provided in the Texas
Non-Profit Corporation Act,[3]
which includes the power A[t]o sell,
convey, . . . transfer, and otherwise dispose of all or any part of its
property and assets.@ Tex. Rev. Civ. Stat. Ann. art.
1396-2.02, ' A(5)
(Vernon 2003).
These
statutes give homeowners associations broad authority unless Aotherwise
provided@ in their
governing documents. Such
limitations must be specifically stated. Brooks v. Northglen
Ass=n, 141
S.W.3d 158, 169 (Tex. 2004).
Silence on an issue cannot Aotherwise
provide[].@ Id.; see also Brooks v.
Northglen Ass=n, 76
S.W.3d 162, 167 (Tex. App.CTexarkana
2002) (AWe can
find no instance where silence on the subject has been construed as
>otherwise
providing.=@),
rev=d in part
on other grounds, 141
S.W.3d 158 (Tex. 2004). Thus,
the powers provided in these statutes need not be enumerated in a
homeowners association=s
governing documents. See
Candlelight Hills Civic Ass=n, Inc. v.
Goodwin, 763
S.W.2d 474, 478B79 (Tex.
App.CHouston
[14th Dist.] 1998, writ denied) (A[I]n
addition to the express provisions in the restrictive covenants, the
appellant is inhered with the powers and purposes enumerated in its
articles of incorporation and bylaws. . . . The interaction of the
Non-Profit Corporation Act is seen in its authorization of the purchase of
real property without the need for an express enumeration of this
power.@).
Greenwood
clearly has the statutory power to sell property unless Aotherwise
provided@ by its
governing documents. Thus, we
analyze those documents. The
articles of merger specify that Reserve C will be owned by the Greenwood
Property Owners Association
Aas part of
the Common Areas.@ Later in the articles of merger,
in a section amending Greenwood=s articles
of incorporation, Greenwood is given power Ato
acquire, own, construct, reconstruct, operate and maintain recreational
facilities as part of the Common Areas . . . , including specifically but
without limitation, all of Reserve >C.=@ This provision is silent on the
issue of selling Common Areas; indeed, another provision confers broad
general power to sell real property.
Appellant fails to identify any portion of the governing documents
that explicitly limits Greenwood=s power to
sell its property. Given the
statutory grant of authority to sell property, in addition to the power
granted in the governing documents and their silence on the specific issue
of selling Common Area, we hold that Greenwood had authority to sell
Reserve C. Accordingly, we
overrule the Rutherfords= first
issue.
In their
second issue, the Rutherfords argue that because the restrictions
applicable to Common Areas do not include the right to sell, those
restrictions must be waived before Greenwood can sell. Because we have already determined
that the Common Area restrictions do not prohibit Greenwood from selling
the property, there is no need for any restrictions to be waived before
Greenwood can do so. We
overrule the Rutherfords= second
issue.
We affirm
the trial court=s
judgment.
/s/ Leslie
Brock Yates
Justice
Judgment
rendered and Opinion Memorandum filed March 28,
2006.
Panel
consists of Chief Justice Hedges and Justices Yates and
Anderson.
[1] In
their appellate brief, the Rutherfords explicitly abandoned their claims
against the individual members of the board and are proceeding only
against the association.
[2] In a
third issue, the Rutherfords contend that because they are entitled to
summary judgment, they are also entitled to attorneys= fees.
Because we conclude the trial court properly granted
Greenwood=s summary judgment motion, we overrule this issue
as well.
[3] In
addition, the articles of merger, in a section amending
Greenwood=s articles of incorporation, specifically
authorize it Ato have and exercise any and all powers, rights
and privileges which a corporation organized and existing under the Texas
Non-Profit Corporation Act may by law now or hereafter have and
exercise.@