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Omohundro v. Sullivan

March 13, 2009

ELISSA A. OMOHUNDRO, TRUSTEE OF THE FIRST RESTATEMENT OF THE ELISSA A. OMOHUNDRO REVOCABLE TRUST AGREEMENT DATED APRIL 8, 2005; WILLIAM D. OMOHUNDRO, TRUSTEE OF THE FIRST RESTATEMENT OF THE WILLIAM D. OMOHUNDRO REVOCABLE TRUST AGREEMENT DATED APRIL 8, 2005; AND THE MC FAMILY OF COMPANIES, LLC, A WYOMING LIMITED LIABILITY COMPANY, APPELLANTS (DEFENDANTS),
v.
TIMOTHY S. SULLIVAN AND KAREN L. SULLIVAN, HUSBAND AND WIFE; WILLIAM J. NOVOTNY, JR. AND MARILYN J. NOVOTNY, HUSBAND AND WIFE; DAVID J. GOEHRING AND LYNDA A. GOEHRING, HUSBAND AND WIFE; BABETTE L. GRALA, TRUSTEE OF THE WILLIAM L. GRALA FAMILY TRUST DATED OCTOBER 19, 2004, CREATED UNDER THE FIRST RESTATED WILLIAM L. GRALA TRUST DATED SEPTEMBER 26, 2001; AND BABETTE L. GRALA, TRUSTEE OF THE FIRST RESTATED BABETTE L. GRALA TRUST DATED SEPTEMBER 26, 2001, APPELLEES (PLAINTIFFS).
TIMOTHY S. SULLIVAN AND KAREN L. SULLIVAN, HUSBAND AND WIFE; WILLIAM J. NOVOTNY, JR. AND MARILYN J. NOVOTNY, HUSBAND AND WIFE; DAVID J. GOEHRING AND LYNDA A. GOEHRING, HUSBAND AND WIFE; BABETTE L. GRALA, TRUSTEE OF THE WILLIAM L. GRALA FAMILY TRUST DATED OCTOBER 19, 2004, CREATED UNDER THE FIRST RESTATED WILLIAM L. GRALA TRUST DATED SEPTEMBER 26, 2001; AND BABETTE L. GRALA, TRUSTEE OF THE FIRST RESTATED BABETTE L. GRALA TRUST DATED SEPTEMBER 26, 2001, APPELLANTS (PLAINTIFFS),
v.
ELISSA A. OMOHUNDRO, TRUSTEE OF THE FIRST RESTATEMENT OF THE ELISSA A. OMOHUNDRO REVOCABLE TRUST AGREEMENT DATED APRIL 8, 2005; WILLIAM D. OMOHUNDRO, TRUSTEE OF THE FIRST RESTATEMENT OF THE WILLIAM D. OMOHUNDRO REVOCABLE TRUST AGREEMENT DATED APRIL 8, 2005; AND THE MC FAMILY OF COMPANIES, LLC, A WYOMING LIMITED LIABILITY COMPANY, APPELLEES (DEFENDANTS).



Appeal from the District Court of Johnson County The Honorable David B. Park, Judge.

The opinion of the court was delivered by: Kite, Justice.

Before VOIGT, C.J., and GOLDEN, HILL, KITE, and BURKE, JJ.

KITE, J., delivers the opinion of the Court; BURKE, J., files a dissenting opinion in which GOLDEN, J., joins.

[¶1] Appellants (hereinafter referred to as Omohundro Trusts) own interests in Tract 6 of the Twin Lakes subdivision near Buffalo, Wyoming, and Appellees (hereinafter referred to collectively as the Sullivan Group) own Tracts 1 through 4. The parties dispute whether, under the subdivision restrictive covenants, Omohundro Trusts were required to obtain consent from all of the landowners before they could take action which would allow the City of Buffalo (herein referred to as the City) to obtain the water rights appurtenant to the subdivision lands. The district court ruled, on summary judgment, that the restrictive covenants unambiguously required the approval of the owners of all of the tracts. We agree and, consequently, affirm.

ISSUES

[¶2] Omohundro Trusts present this issue for our consideration in Case No. S-08-0027:

Can the covenants and restrictions contained in the Covenants for Twin Lakes, Buffalo, Wyoming, which document specifically states that the restrictive covenants were created for and imposed upon Tracts 1-5, be extended by implication to also restrict the use of Tract 6?

The Sullivan Group lists three issues in Case No. S-08-0027:

1. Is there any reason, as a matter of law, that the Exhibit B lands could not be burdened in favor of the Exhibit A lands for whose benefit the Covenants were imposed?

2. Is there any ambiguity in the language of Section 3.13 of the Covenants?

3. Does the plain language of Section 3.13 of the Covenants support the District Court‟s declaratory judgment that the consent and approval of all Landowners is necessary before the Developer can take any action, step or procedure to annex the Exhibit B lands to the City of Buffalo under terms which would allow the City to receive ownership and control of a portion of these territorial water rights?

In its cross-appeal in Case No. S-08-0028, the Sullivan Group states the following issue:

If the Supreme Court does not simply affirm the District Court‟s summary judgment based on the plain meaning of the Covenants, may the Court consider uncontroverted facts and contextual evidence concerning the water rights which were the subject of Section 3.13 of the Covenants in the course of its de novo review?

Omohundro Trusts restate the issue in Case No. S-08-0028 as:

Should this Court, in construing the Covenants, consider extrinsic evidence that contradicts the plain language of the document and is asserted for the purpose of enlarging and adding to the restrictive covenant at issue?

FACTS

[¶3] In 1994, Gerald Kaufmann acquired a 209 acre ranch known as the Crain property and its appurtenant water rights. The City owned an easement across the Crain property for a water line, and the existing ranch house was supplied with City water. Mr. Kaufmann entered into a "Water Connector‟s Agreement" with the City in which the City agreed to provide six additional residential water taps to the property. The agreement also provided that, if the property were ever subdivided into more than seven parcels so that additional water taps were requested, the City would have the option to acquire the water rights appurtenant to all of the property.

[¶4] After executing the Water Connector‟s Agreement, Mr. Kaufmann conveyed the property to Twin Lakes L.C. (Twin Lakes), a company in which he and William Omohundro were members. Twin Lakes subdivided the property into six lots. Tracts 1 through 4 were vacant lots, each a little larger than 35 acres. Tract 5 was approximately 11 acres and included the existing ranch house. Tract 6 was the largest, at just over 50 acres. Twin Lakes executed and filed the restrictive covenants now at issue, then sold the lots.

[ΒΆ5] Omohundro Trusts, the current owners of Tract 6, entered into an agreement in 2006 giving MC Family of Companies, LLC the option to purchase the property. They have plans for Tract 6 to be annexed into the City and subdivided into approximately 90 residential lots. ...


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