An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Proced ure.

NO. COA02-1543


Filed: 6 January 2004


v .                             Iredell County
                                No. 02 CVS 1519

    Appeal by defendant from judgment entered 11 September 2002 by Judge Christopher M. Collier in Iredell County Superior Court. Heard in the Court of Appeals 27 October 2003.

    No brief filed on behalf of plaintiff-appellees.

    Thomas, Godley & Childers, P.A., by Mark L. Childers, for defendant-appellant.

    EAGLES, Chief Judge.

    This appeal arises from a civil action to enforce restrictive covenants. Defendant appeals from judgment entered upon default, granting declaratory and injunctive relief in favor of plaintiffs and awarding attorneys' fees.
    The record tends to establish the following: Plaintiffs and defendant own adjoining lots in the Harbor Cove Subdivision (“Harbor Cove”), a planned residential subdivision bordering Lake Norman in Iredell County. Defendant's lot is lake front, plaintiffs' lot is “lake view.” Plaintiffs must look across defendant's lot in order to see the lake. All lots within HarborCove are subject to certain covenants, conditions, restrictions and easements. These restrictions provide that the architectural committee must approve any “[i]mprovements” to a resident's property before it is undertaken. The restrictions also regulate the construction of fences on a resident's property.
    On or about 29 March 2002, defendant planted two rows of trees on his property, one row bordering each side of defendant's driveway. Although not yet fully mature, the trees partially obscured plaintiffs' view of the lake. Defendant had not obtained approval from the architectural committee prior to planting the trees. Plaintiffs informed defendant that he had planted the trees in violation of the subdivision's restrictions and asked defendant to remove the trees; however, defendant refused. The trees soon grew together and created a solid hedgerow along each side of defendant's driveway.
    On 21 June 2002, plaintiffs filed a civil complaint in Iredell County Superior Court seeking declaratory and injunctive relief. Plaintiffs alleged that by planting the trees, defendant had constructed a “fence” on his property. Plaintiffs further alleged that defendant violated the restrictive covenants by not obtaining written approval from the architectural committee prior to constructing the fence. Despite receiving personal service of the complaint, defendant failed to file an answer or appear in the action. On 2 August 2002, default was entered by the clerk. On 11 September 2002, the trial court entered default judgment against defendant, finding that defendant violated Harbor Cove'srestrictive covenants by “placing a fence consisting of plants (a hedge fence)” on his property without first obtaining the permission of the architectural committee. The trial court ordered the “hedge fence” removed and awarded plaintiffs attorneys' fees in the amount of $1,487.50. Defendant appeals.
    This appeal presents the following issues: (1) whether the restrictive covenants required defendant to obtain permission from the architectural committee before planting the trees; and (2) whether the trial court had authority to award plaintiffs attorneys' fees. We affirm the decision of the trial court as to the first issue, but reverse as to the second issue.


    Defendant first contends that the trial court erred by concluding that his trees constitute a “fence” under Harbor Cove's restrictive covenants. Defendant argues that a “fence” is defined as an “improvement” under Harbor Cove's restrictive covenants. Citing Vogel v. Reed Supply Co., 277 N.C. 119, 177 S.E.2d 273, (1970), defendant further argues that the term “improvement,” as it is used in Harbor Cove's restrictive covenants, contemplates the performance of construction work. Therefore, defendant contends he was not required to obtain permission from the architectural committee to plant his trees. We disagree.
    As a preliminary matter, we note that neither defendant's failure to answer the complaint nor the entry of default judgment against defendant precludes our review of this issue. The failure of a defendant who has been duly served to appear and answer acomplaint seeking declaratory judgment does not automatically entitle the plaintiff to judgment; rather, it merely constitutes an admission of every material fact pled in the complaint which is essential to the judgment sought. Baxter v. Jones, 14 N.C. App. 296, 312, 188 S.E.2d 622, 631, cert. denied, 281 N.C. 621, 190 S.E.2d 465 (1972). The trial court must still proceed to construe the restrictive covenants. Id. Proper construction of the coventants together with the admitted facts determine the rights of the parties. Id. Accordingly, the trial court's construction of Harbor Cove's restrictive covenants is properly before this Court.
    The fundamental rule in construing restrictive covenants is that the intentions of the parties govern. Donaldson v. Shearin, 142 N.C. App. 102, 106, 541 S.E.2d 777, 780, aff'd per curiam, 354 N.C. 207, 552 S.E.2d 142 (2001). The parties' intentions “must be gathered from study and consideration of all the covenants contained in the instrument or instruments creating the restrictions.” Id. (quoting Long v. Branham, 271 N.C. 264, 268, 156 S.E.2d 235, 238 (1967)). Although covenants and agreements restricting the free use of property are strictly construed, “restrictive covenants should not be so strictly construed 'as to defeat the purpose of the restriction.'” Id. at 106, 541 S.E.2d at 780 (quoting Robinson v. Pacemaker Investment Co., 19 N.C. App. 590, 594, 200 S.E.2d 59, 61 (1973), cert. denied, 284 N.C. 617, 201 S.E.2d 689 (1974)). “Where the meaning of restrictive covenants is doubtful 'the surrounding circumstances existing at the time of the creation of the restriction are taken into consideration indetermining the [parties'] intention.'” Long v. Branham, 271 N.C. 264, 268, 156 S.E.2d 235, 239 (1967)(quoting V. Woerner, Annotation, Maintenance, Use, or Grant of Right of Way Over Restricted Property As Violation of Restrictive Covenant, 25 A.L.R. 2d 904, 905 (1952)).
    The term “fence” is not defined by Harbor Cove's restrictive covenants. Instead, § 6.1 of the Declaration of Covenants, Conditions, Restrictions and Easements (“Declaration”) provides in pertinent part:
    Other than the Initial Improvements [i.e. “residences, outbuildings and other structures initially constructed within the Subdivision”], no building, fence, wall, porch, deck or any other structure or improvement (collectively “Improvements”) including, without limitation, the alteration or painting of the exterior surface of any existing Improvements or Initial Improvements shall be undertaken upon any Lot unless the plans and specifications and location of the proposed Improvements shall have been expressly approved in writing by the Architectural Committee . . . .

    In Vogel v. Reed Supply Co., 277 N.C. 119, 177 S.E.2d 273 (1970), our Supreme Court noted:
    “The word 'improvement' is a relative and very comprehensive term, whose meaning must be ascertained from the context and the subject matter of the instrument in which it is used.” The word is sometimes used to refer to any enhancement in value, particularly in relation to non-structural changes to land. But where . . . it is used in context with the words building and structure, its meaning is otherwise. As used here it connotes the performance of construction work and presupposes the prior existence of some structure to be improved. As used with reference to land, the word improvement presupposes the prior existence of the land itself.

Id. at 132-33, 177 S.E.2d at 281-82 (citations and emphasis omitted).     Defendant, relying on Vogel, argues that the term “[i]mprovement,” as it is used in § 6.1 of the Declaration contemplates the performance of construction work and, therefore, does not apply to merely planting trees. After careful review of all of Harbor Cove's restrictive covenants, we conclude that defendant's construction of the term “[i]mprovement” is overly narrow and fails to give effect to either the manifest intent of the parties or the purpose of the restriction.
    First, defendant's construction of the term requires viewing § 6.1 of the Declaration in isolation. However, § 6.1 is not the only portion of the Declaration that references the term “[i]mprovements.” Article VII of the Declaration provides in part:
    Each Owner shall be responsible for the maintenance of his or her dwelling and lot. Maintenance of such dwelling and lot shall include, without limitation, painting, replacement and care of roofs, gutters, downspouts, exterior building surfaces, lawns, trees, shrubs, driveways, walks and other exterior improvements.

(Emphasis added).
    When Article VII's reference to “exterior improvements” is considered in conjunction with § 6.1's use of the disjunctive “or” in providing examples of “[i]mprovements,” as well as the “without limitation” language, it appears the parties intended § 6.1 to apply to: (1) additions or alterations to existing structures; (2) new structures; or (3) any other exterior improvements, which may or may not require the performance of construction work.
    This construction is further supported by § 6.3, which provides that “[t]he Architectural Committee shall, from time to time, publish and promulgate architectural, landscape, and/or lakebuffer guidelines . . . as a guide to assist the Architectural Committee in reviewing any proposed plans, specifications and materials submitted . . . for approval.” (Emphasis added). This language evidences an intent that the architectural committee would have approval authority over landscaping improvements.
    Finally, although one of the primary purposes for establishing the restrictive covenants was “to insure the attractiveness of the Development[and] to prevent any future impairment thereof,” there is no provision in the Declaration that specifically addresses landscaping apart from those already mentioned. If this Court were to adopt defendant's construction of the term “[i]mprovement,” the architectural committee would have no authority over landscaping or any other improvements made to the land. In addition to nullifying portions of § 6.3, this would defeat, at least in part, the stated purpose of the Declaration. This could not have been what the parties intended. We conclude the term “[i]mprovement,” as used in Harbor Cove's Declaration, refers to any exterior alteration or improvement to both structures and land.
    We hold that by planting his trees, defendant made an “[i]mprovement” to his land, which required permission from the architectural committee. Accordingly, the decision of the trial court is affirmed.

    Defendant next contends that the trial court improperly awarded plaintiffs' attorneys' fees. Defendant argues that although the restrictive covenants provided for the recovery of attorneys'fees, there was no statutory authority to support the award. We agree.
    A party may not recover attorneys' fees, even when authorized by a declaration of restrictive covenants, “'unless such a recovery is expressly authorized by statute.'” McGinnis Point Owners Ass'n v. Joyner, 135 N.C. App. 752, 756, 522 S.E.2d 317, 320 (1999)(quoting Stillwell Enter., Inc. v. Interstate Equip. Co., 300 N.C. 286, 289, 266 S.E.2d 812, 814 (1980)). There are two statutory bases for the recovery of attorneys' fees applicable to the enforcement of restrictive covenants: G.S. § 47F-3-120 and G.S. § 6-21.2. After careful review of the record, we conclude neither statute applies in this case.
    First, G.S. § 47F-3-120 authorizes the recovery of attorneys' fees in any action to enforce restrictive covenants brought pursuant to Chapter 47F (the North Carolina Planned Community Act). However, the provisions of Chapter 47F do not apply to planned communities created prior to 1 January 1999, unless the community's declaration is amended to specifically incorporate Chapter 47F. G.S. § 47F-1-102. Here, Harbor Cove was created in 1996 and as of the date of this appeal, Harbor Cove had not amended its declaration in accordance with G.S. § 47F-1-102. Therefore, the attorneys' fees provisions of Chapter 47 do not apply here.
    Second, G.S. § 6-21.2 authorizes the recovery of attorneys' fees upon the collection of a “note, conditional sale contract or other evidence of indebtedness . . . .” Id. “[T]he term 'evidence of indebtedness' as used in G.S. 6-21.2 has reference to anyprinted or written instrument, signed or otherwise executed by the obligor(s), which evidences on its face a legally enforceable obligation to pay money.” Stillwell Enter., Inc. v. Interstate Equip. Co., 300 N.C. 286, 294, 266 S.E.2d 812, 817 (1980).
    Here, defendant did not sign Harbor Cove's declaration of restrictive covenants. Moreover, the covenants being enforced do not evidence, on their face, a legally enforceable obligation to pay money. Cf. Four Seasons Homeowners Ass'n. v. Sellers, 72 N.C. App. 189, 192, 323 S.E.2d 735, 738 (1984). Therefore, the trial court's order awarding attorneys' fees is not authorized by G.S. § 6-21.2.
    Since there was no statutory authority to enter an award of attorneys' fees in this case, we reverse the portion of the trial court's order directing defendant to pay plaintiffs' attorneys' fees.
    Affirmed in part, reversed in part.
    Judges HUNTER and GEER concur.
    Report per Rule 30(e).

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