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Hamilton v. Schaefer Lake Lot Owners Association, Inc.

Court of Appeals of Indiana

September 13, 2016

Marvin Hamilton and Linda Hamilton, Appellants-Defendants,
v.
Schaefer Lake Lot Owners Association, Inc., Appellee-Plaintiff

         Appeal from the Bartholomew Superior Court The Honorable James D. Worton, Special Judge Trial Court Cause No. 03D02-1309-SC-2182

          ATTORNEY FOR APPELLANT Scott C. Andrews Andrews Law Office, LLC Columbus, Indiana

          ATTORNEY FOR APPELLEE John A. Stroh Sharpnack Bigley Stroh & Washburn LLP Columbus, Indiana

          Baker, Judge.

         [¶1] Marvin and Linda Hamilton (collectively, the Hamiltons) appeal the trial court's judgment entered against them and in favor of Schaefer Lake Lot Owners Association, Inc. (the Association). As consolidated and restated, the Hamiltons contend that they are not members of the Association and do not owe money for annual and special assessments, and that the statute of limitations bars claims for assessments made prior to 2008. Finding that the Hamiltons are members of the Association and therefore owe money for the assessments, and that the statute of limitations does not bar any of the Association's claims, we affirm.

         Facts

         [¶2] Schaefer Lake Addition was developed by Albert and Helen Schaefer in three sections: Section 1 was platted in 1960, Section 2 was platted in 1961, and Section 3 was platted later. In 1971, the Association was formed.

         [¶3] In 1973 or 1974, the Hamiltons purchased lot 89 in Section 2 of Schaefer Lake Addition. At the time of purchase, their property was subject to the Schaefer Lake Addition Covenants (Covenants). The Covenants provided the following:

These covenants are to run with the land and shall be binding on all parties and all persons claiming under them for a period of twenty five years from the date this plat is recorded, after which time said covenants shall be automatically extended to successive periods of ten years unless an instrument signed by a majority of the then owners of the lots has been recorded agreeing to change said covenants in whole or in part.

Defendant's Ex. 1 (emphasis added). The Covenants did not mention requirements relating to membership in the Association and did not specify that lot owners have to pay any assessments to the Association.

         [¶4] In 1976, the Association amended its Articles of Incorporation, and in 1977, it filed the Amended Articles of Incorporation (Amended Articles) with the Secretary of State. The Amended Articles provided that a lot owner is entitled to membership in the Association and "said membership [is] predicated upon the remittance of the initial membership fee of $15.00." Defendant's Ex. 3. Also in 1977, Albert and Helen Schaefer recorded additional covenants entitled Declaration of Covenants (Declaration). The Declaration provided that any lots owned by anyone other than the Schaefers may be subject to the Declaration by voluntarily executing and recording a Supplementary Declaration of Covenant. The Schaefers could also subject additional lots owned by them to the Declaration by providing in a deed, original platting, or additions to the plats, that the lots be subject to, owned, held, and transferred under the provisions of the Declaration. The Declaration provided that any new owner must pay an initial membership fee of fifteen dollars, and that this fee is to be paid upon change of legal ownership, within thirty days of the date of transfer of legal title.

         [¶5] In 1996, owners of thirty of the fifty-eight Section 2 lots voted to amend the Covenants that related to Section 2. The amendment provided:

All Lot Owners in Schaefer Lake Addition, Section 2, their assigns or successors, shall be members in Schaefer Lake Lot Owners Associates, Inc., an Indiana Corporation, or any successor to this organization, and shall be subject to all rules and regulations thereof.
All Lots in Schaefer Lake Addition, Section 2, shall be subject to the covenants, restrictions, charges, liens, and provisions of the Declaration of Covenants executed by Albert A. Schaefer and Helen E. Schaefer, husband and wife, July 29, 1977, and recorded September 27, 1977, in the Office of the Recorder of the Bartholomew County, Indiana.
These covenants are to run with the land and shall be binding on all parties and all persons claiming under them for a period of one year from the ...

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