Severiano Martinez Rubio v. BB&J Holdings
E2020-00355-COA-R3-CV
| Tenn. Ct. App. | Jun 25, 2021Background
- Sunset Addition subdivision deeds include recorded restrictive covenants limiting use to "residential purpose only" and prohibiting commercial activities.
- In 2013 BB&J Holdings purchased lots 19–20 (the Britt Property) and, aware of the covenants, razed the homes and built Sandstone Drive to serve the Masengill Springs commercial development.
- BB&J’s principal testified he knew of the restrictions but believed they did not apply to the roadway project.
- Severiano and Maria Rubio own adjacent lots 21–22 and sued seeking injunction/specific performance (closure/removal of road and sign), compensatory and punitive damages, alleging increased traffic, light, safety and enjoyment impacts.
- The trial court found a technical covenant violation by BB&J, denied equitable relief and punitive damages, dismissed individual defendants, awarded nominal damages of $500 against BB&J, and exonerated the City; the Rubios appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether trial court properly applied law to enforcement of restrictive covenants | Rubio: BB&J violated covenants and is liable; equitable relief (closure/injunction) and damages are appropriate | BB&J/City: Even if violation occurred, equitable relief is inappropriate given changed conditions, acquiescence, and lack of measurable damages | Court: Found a technical violation but properly denied specific equitable relief; awarded nominal $500 damages to BB&J only |
| Whether covenants remain subject to equitable enforcement given changed neighborhood character | Rubio: Covenants remain enforceable despite change; injunction still warranted | BB&J: Radical change in character, prior releases, and acquiescence render specific enforcement inequitable | Court: Held neighborhood and surrounding parcel use changed materially; enforcement of injunction would be inequitable under Tennessee precedent, so only nominal damages awarded |
Key Cases Cited
- Hackett v. Steele, 297 S.W.2d 63 (Tenn. 1956) (radical change in conditions may render residential restrictive covenants unenforceable).
- Hysinger v. Mullinax, 319 S.W.2d 79 (Tenn. 1958) (equity may deny specific performance of covenants when neighborhood change defeats covenant purposes).
- Elm Hill Homes, Inc. v. Jessie, 857 S.W.2d 566 (Tenn. Ct. App. 1993) (restrictive covenants with no expiration are not to be arbitrarily limited to a 20-year term).
- Womack v. Ward, 186 S.W.2d 619 (Tenn. Ct. App. 1944) (nominal damages appropriate for technical violation absent proven economic loss).
- Scandlyn v. McDill Columbus Corp., 895 S.W.2d 342 (Tenn. Ct. App. 1994) (acquiescence or failure to object can forfeit right to enforce covenants).
- Hillis v. Powers, 875 S.W.2d 273 (Tenn. Ct. App. 1993) (restrictive covenants disfavored but enforceable when intent to bind successors is clear).