BELL CANYON ACRES HOMEOWNERS ASSOCIATION, еt al. v. MICHAEL SEAN MCLELLAND, et al.
No. 20180072
Supreme Court of the State of Utah
May 21, 2019
2019 UT 17
On Appeal of Interlocutory Order, Third District, Salt Lake, The Honorable Gary D. Stott, No. 160907281
Gregory S. Moesinger, Salt Lake City, for appellants
Dale B. Kimsey, Salt Lake City, for appellees
JUSTICE HIMONAS, opinion of the Court:
INTRODUCTION
¶1 Good fences, it appears, stop making good neighbors right about where they start to encroach on bridle paths.3 In this case we are askеd to decide whether the Utah Declaratory Judgment Act requires neighbors objecting to such fences to sue all homeowners whose property is subject to the bridle path easement or just those homeowners who have fences (or other improvements) that are alleged to infringe on the path. The district court thought the Act required joinder of all homeowners and therefore declined to enter summary judgment for appellants. We hold, however, that no such joinder is required and reverse and remand this matter to the district court for proceedings consistent with this opinion.
BACKGROUND
¶2 Bell Canyon Acres Community is a unique residential neighborhood that is zoned for housing large animals and has historically been used for the housing and enjoyment of horses. Located throughout Bell Canyon Acres is a network of riding easements and rights-of-way that are dedicated as bridle paths for the use of residents. These bridle path easements originate in a series of restrictive covenants that apply to the lots in Bell Canyon Acres. The size and location of the bridle paths are reflected in a series of recorded plat maps.
¶3 Appellants brought suit alleging that appellees—four of thе approximately one hundred homeowners in Bell Canyon Acres—have intruded upon the bridle path, thereby violating the restrictive covenants. Appellants sought a declaratory judgment determining the parties’ rights in the bridle paths, determining the enforceability of the restrictive covenants, and dеclaring that appellees are encroaching on the bridle paths in violation of the restrictive covenants. Appellees filed a motion to dismiss and appellants later filed a motion for summary judgment. The district court denied both motions. At issue in this case is the denial of appellants’ motion for summary judgment.
¶4 The district court ruled that it could, as a matter of law, determine that the restrictive covenant establishes a fifty-foot wide bridle path easement over the appellees’ lots. The district court also determined that a limitation period set forth in the restrictive covenants did not preclude appellants’ enforcement of the bridle path easement. But the district court denied summary judgment because appellants did not join all homeowners in the community whose property is subject to the restrictive covenants and the bridle path easement (collectively, the outsiders). Drawing on the Utah Declaratory Judgment Act, which provides that “[w]hen declaratory relief is sought all persons shall be made parties who have or claim any interest which would be affected by the declaration, and a declaration may not prejudice the rights of persons not parties to the proceeding,”
¶5 Appellants filed this interlocutory appeal, asking us to overturn the district court‘s ruling that section 403 of the Utah Declaratory Judgment Act mandates joinder оf the outsiders before appellants can proceed with their action for declaratory relief. Specifically, appellants ask us to determine whether section 403 requires the outsiders—whose lots are subject to the restrictive covenants and the bridle path easemеnt—to be joined in appellants’ declaratory action seeking the interpretation and enforcement of the
¶6 We exercise jurisdiction pursuant to
STANDARD OF REVIEW
¶7 “A district court‘s interpretation of a statute is a question of law, which we . . . review for correctness.” Bryner v. Cardon Outreach, LLC, 2018 UT 52, ¶ 7, 428 P.3d 1096 (alteration in original) (citation omitted) (internal quotation marks omitted).
ANALYSIS
¶8 Appellants ask us to determine whether, pursuant to section 403 of the Utah Declaratory Judgment Act, the outsiders must be joined in this action before appellants can proceed with their claim for declaratory relief. We hold that they do not. The outsiders have no legal interests that cоuld be affected by the declaration appellants seek here and therefore section 403 presents no impediment to the declaratory relief appellants seek. This holding dispositively resolves the issue before us on interlocutory appeal.
¶9 However, because the district court‘s interpretation of section 403 raises some constitutional concerns, we also take this opportunity to briefly acknowledge and address these concerns.
I. SECTION 403 DOES NOT MANDATE JOINDER OF THE OUTSIDERS IN THIS ACTION
¶10 Section 403 of the Utah Declaratory Judgment Act provides that “[w]hen declaratory relief is sought all persons shall be made parties who have or claim any interest which would be affected by the declaration, and a declaration may not prejudice the rights of persons not parties to the proceeding.”
¶11 Below, appellants sought a declaratory judgment “in favor of [appellants], and against [appellees], including that the Restrictive Covenants are enforceable, that [appellants] have rights, title, and interest in the Bridle Paths, and that [appellees] are violating, trespassing, and encroaching the same, and thereby, damaging [appellants].” Nowhere in their complaint do appellants ask the court to determine or adjudicate the rights or interests of persons that are not parties to this proceeding. In other words, appellants seek a declaration affecting only their own legal intеrests and the legal interests of the named appellees.
¶12 Additionally, it is a “core principle of due process” that “outsiders not joined in a proceeding (and not in privity with someone who was joined)” must be able to have their day in court. Krejci v. City of Saratoga Springs, 2013 UT 74, ¶ 16, 322 P.3d 662 (citing Blonder-Tongue Labs., Inc. v. Univ. of Ill. Found., 402 U.S 313, 329 (1971)). As a result, “if an outsider is not joined in an action, it is not bоund by the judgment and not precluded from filing a separate proceeding to resolve the same or similar issues.” Id. ¶ 15.
¶13 There are therefore at least two impediments that preclude holding that the outsiders have an interest that will be affected by a declaration in this case. First, appellаnts have not sought a declaration that purports to affect the interests of any outsider. Rather, appellants seek a declaration that establishes rights only as to appellants and appellees. And second, even if appellants sought a declaration purporting to affect the legal interests of the outsiders, that declaration would have no legal effect on the outsiders unless they were joined in the action or
¶14 Because the outsiders not joined in this lawsuit—but whose lots are also subject to the restrictive covenants—have no legal interest that would be affected by the declaration appellants seek here, section 403 provides no barrier to the declaratory relief appellants seek.6
II. SECTION 403 CANNOT PRESCRIBE RULES FOR JOINDER OR INTERVENTION
¶15 Our determination that the outsiders have no legаl interest that would be affected by the declaration the appellants seek here is dispositive. But we would also like to address another problem with the district court‘s interpretation of section 403 that raises a concern about the operation of section 403. Specifically, if section 403 were interpreted to somehow mandate and provide the procedure for joinder or intervention of parties, that would raise serious concerns about the constitutionality of section 403.
¶16 The Utah Constitution vests this court with the power and obligation to “adopt rules of рrocedure and evidence to be used in the courts of the state.”
¶17 This grant of rulemaking authority is not limitless. Article VIII, section 4 also provides that “[t]he Legislature may amend the Rules of Procedure and Evidence adopted by the Supreme Court upon a vote of two-thirds of all members of both houses of the Legislature.” But any such amendment “need[s] to contain a reference to the rule to be amended and a clear expression of the Legislature‘s intent to mоdify our rules.” Brown v. Cox, 2017 UT 3, ¶ 20, 387 P.3d 1040.
¶18 Neither section 403 nor any other section of the Act contains a reference to rule 19 or rule 24, much less “a clear expression of the Legislature‘s intent to modify” those rules. Id. Because nothing in the Act
¶19 Because we are able to resolve this case without ruling on whether section 403 mandates the joinder or intervention of certain parties, and because the parties did not brief these constitutional questions, we leave them for another day.
CONCLUSION
¶20 Section 403 provides no impediment to the declaratory judgment appellants seek here. Because the outsiders have no legal interest that would be affected by a declaration in this case, they do not need to be joined as parties. We rеverse and remand to the district court for a ruling consistent with this opinion.
Notes
The outsiders cannot be considered privies of any party joined in this action simply by virtue of also owning property subject to the same restrictive covenants. “The legal definition of a person in privity with another, is a person so identified in interest with another that he represents the same legal right.” Searle Bros. v. Searle, 588 P.2d 689, 691 (Utah 1978). Examples of parties that have been found to be in privity with one another—and therefore potentially subject to claim and issue preclusion in a subsequent case—are “officers or ownеrs of a closely held corporation, partners, co-conspirators, agents, alter egos or other parties with similar legal interests.” Press Publ‘g, Ltd. v. Matol Botanical Int‘l, Ltd., 2001 UT 106, ¶ 20, 37 P.3d 1121 (surveying cases in which parties were considered privies). It is not enough that the outsiders and the named parties here are both parties to a сontract—in this case, the restrictive covenants. The individual property rights held by the outsiders are separate and distinct from the individual property rights held by the named parties. So the parties cannot be said to have rights so similar such that the named parties represent the same legal rights as the outsiders. Consequently, any of the outsiders’ rights under the restrictive covenants may only be determined—and therefore their legal interests may only be affected—in an action in which they are joined as parties.
Additionally, it could be argued that section 403 eliminates claim and issue preclusion with respect to declaratory judgments involving privies. As the second half of subsection 403(1) provides, “a declaration may not prejudice the rights of persons not parties to the proceeding.”