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All opinions are subject to modification and technical correction prior to official publication in the North Carolina Reports and North Carolina Court of Appeals Reports. In the event of discrepancies between the electronic version of an opinion and the print version appearing in the North Carolina Reports and North Carolina Court of Appeals Reports, the latest print version is to be considered authoritative.
JOHN P. REIDY, and wife, TERRI L. REIDY, Plaintiffs, v. WHITEHART
ASSOCIATION, INC., Defendant
Filed: 7 August 2007
1. Estoppel_validity of homeowners association_delay in contesting_earlier recognition
Plaintiffs were estopped from contesting the validity of a homeowners association where
they purchased their lot subject to the declaration of covenants; they did not contest the validity
of the association for nearly five years, until the architectural committee denied their design
approval request; and there was evidence in the record that plaintiffs recognized the validity of
the association by paying dues.
2. Associations; Deeds_validity of homeowners association_incorporation after sale of
The Planned Community Act applies to this case despite plaintiff's contention that the
homeowners association was incorporated after the conveyance of the first lot in violation of
N.C.G.S. § 47F-3-101 (2005). That was not one of the provisions made applicable to
communities created before the effective date of the Act.
3. Deeds; Constitutional Law_contract clause_homeowners association_retroactive
application of enforcement statue
The Contract Clause of the United States Constitution was not violated by retroactive
application of a statute allowing fines and suspension of services for violating the regulations and
covenants of a homeowners association. The statute merely provides an additional remedy for
the enforcement of the declaration and does not disturb a vested right, impair a binding contract
or create a new obligation.
4. Deeds; Constitutional Law_substantive due process_Planned Community Act
Retroactive application of Planned Community Act did not violate plaintiffs' substantive
due process rights. The individual statutes that form the Act are rationally related to the
legitimate purpose of providing a statutory framework for dealing with modern real estate
developments, particularly planned communities.
5. Constitutional Law_procedural due process_enforcement of homeowners
Plaintiffs' procedural due process rights were not violated by the procedure provided by a
homeowners association. Even if the creation of the statutory framework by the legislature is
sufficient state action, the statutes provided notice and the opportunity to be heard, and the
association in this case provided both.
6. Appeal and Error_preservation of issues_absence of legal authority
An argument in plaintiffs' brief with no citation to legal authority was taken as
7. Deeds; Constitutional Law_enforcement of homeowners association covenants_no
evidence of discrimination
A homeowners association did not discriminate against plaintiffs by refusing to allow a
building modification where plaintiffs admitted erecting their staircase and door without the
architectural committee's approval, and in fact did so in the face of disapproval. Moreover, there
does not appear to be any evidence of discrimination.
8. Appeal and Error_cross-appeal_notice filed with superior court clerk
The homeowners association's cross-appeal was dismissed for lack of jurisdiction where
its notice of cross-appeal was filed with the Clerk of the Court of Appeals, not with the Clerk of
Superior Court of Wake County.
Appeal by plaintiffs and cross-appeal by defendant from order
entered 20 June 2006 by Judge Robert H. Hobgood in Wake County
Superior Court. Heard in the Court of Appeals 4 June 2007.
Harris & Hilton, P.A., by Nelson G. Harris, for plaintiff
Jordan Price Wall Gray Jones & Carlton, by Henry W. Jones,
Jr., Brian S. Edlin and Jessica E. Cooley, for defendant
Plaintiffs appeal from an order granting defendant's motion
for summary judgment and mandatory injunction and order denying
plaintiffs' motion for summary judgment. Defendant cross-appeals
from the same order because the trial court did not award
reasonable attorneys' fees to defendant. We affirm.
John P. Reidy, and wife, Terri L. Reidy (plaintiffs)
obtained title to Lot 54 in the Whitehart Subdivision (the Lot)
by deed recorded on 16 July 1999. On or about 28 February 2005,plaintiff John Reidy requested design approval from the Whitehart
Architectural Committee for a structural addition to his property.
Specifically, he wanted to add a door and staircase to the rear
exterior of his detached garage in order to provide access to the
upstairs storage area above his garage. On 3 March 2005, the
Architectural Committee denied Mr. Reidy's request because the
addition would not be consistent with the aesthetics of the
neighborhood. Despite the Committee's decision, plaintiffs
commenced construction of the staircase on the rear of their
detached garage in or about August of 2005.
In response to plaintiffs' disregard of the Architectural
Committee's decision, Whitehart Association, Inc. (the
Association) sent plaintiffs a letter on 31 August 2005 inviting
them to attend a hearing. Plaintiffs appeared on 27 October 2005
before the Board of the Association. The Board voted to impose a
fine in the amount of $25.00 per day commencing on 1 November 2005
for plaintiffs' violation.
On 31 October 2005, plaintiffs filed a complaint against the
Association. On 21 December 2005, the Association served its
answer, motions to dismiss, motion for judgment on the pleadings,
affirmative defenses and counterclaim on plaintiffs. The
counterclaim sought, in part, to collect the fines which were
secured by a claim of lien. On 3 January 2006, plaintiffs filed
their response to the Association's counterclaim and affirmative
defenses. On 12 December 2005, plaintiffs filed a motion for summary
judgment as to all but one of the counts included in their
complaint. On 27 January 2006, the Association filed its cross
motion for summary judgment on all counts contained in defendant's
counterclaim and all counts contained in plaintiffs' complaint.
On 24 February 2006, the trial court entered an order granting
the Association's cross motion for summary judgment on counts 1, 2,
3, 5, 6, and 7 of plaintiffs' complaint. In addition, the trial
court denied plaintiffs' motion for summary judgment as to counts
1, 2, 3, 5, 6, and 7 of plaintiffs' complaint. The trial court
continued the hearing on count 4 of plaintiffs' complaint and
counts 1 and 2 of the Association's counterclaim.
The plaintiffs filed a motion for summary judgment as to count
4 of their complaint and counts 1 and 2 of defendant's
counterclaim. On 20 June 2006, the trial court entered an order
granting the Association's cross motion for summary judgment as to
count 4 of plaintiffs' complaint. The trial court granted the
Association's cross motion for summary judgment as to counts 1 and
2 of its counterclaim requiring removal of the staircase and door
and entering judgment for the fines accrued through the date of the
Plaintiffs appeal the trial court's order entered 20 June
2006. The Association cross appeals the failure of the trial court
to award reasonable attorneys' fees.
All of plaintiffs' contentions on appeal contest the trial
court's granting of summary judgment in favor of the Association;
so the following standard of review applies. Summary judgment is
appropriate only if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any
material fact and that any party is entitled to a judgment as a
matter of law. N.C. Gen. Stat. § 1A-1, Rule 56(c) (2005). There
is no genuine issue of material fact where a party demonstrates
that the claimant cannot prove the existence of an essential
element of his claim or cannot surmount an affirmative defense
which would bar the claim. Harrison v. City of Sanford, 177 N.C.
App. 116, 118, 627 S.E.2d 672, 675, disc. review denied, 361 N.C.
166, 639 S.E.2d 649 (2006). On appeal from a grant of summary
judgment, this Court reviews the trial court's decision de novo.
Falk Integrated Tech., Inc. v. Stack, 132 N.C. App. 807, 809, 513
S.E.2d 572, 573-74 (1999).
I - The Association
 Plaintiffs contend the trial court erred in granting
summary judgment in favor of the Association on the basis that (1)
the Association was improperly formed, and (2) the membership of
the Association conflicted with the allowed membership as defined
in the Declaration of Covenants, Conditions and Restrictions (the
Declaration). We disagree.
Under a quasi-estoppel theory, a party who accepts a
transaction or instrument and then accepts benefits under it may beestopped to take a later position inconsistent with the prior
acceptance of that same transaction or instrument. Whitacre P'ship
v. Biosignia, Inc., 358 N.C. 1, 18, 591 S.E.2d 870, 881-82 (2004).
Plaintiffs obtained title to the lot on or about 16 July 1999, and
they conceded in their response to the counterclaim of the
Association that they purchased the lot subject to the Declaration.
Nothing in the record illustrates that plaintiffs have contested
the validity of the Association between 8 December 2000, the date
the Association filed its Articles of Incorporation, and 3 March
2005, the date on which the Architectural Committee denied
plaintiffs' request. However, there is some evidence in the record
that plaintiffs recognized the validity of the Association. For
example, based on the accounting records of the management company
for Whitehart, plaintiffs have paid their annual assessments
consistently since January 2001. In addition, plaintiffs requested
design approval from the Architectural Committee for the structural
addition. There is also evidence that plaintiff Terry Reidy called
the property manager of Whitehart on or about May of 2005 and
complained about a neighbor damaging common property. In response
to plaintiff Terry Reidy's complaint, the property manager sent a
letter to the neighbor stating that complaints have been received
regarding the damage to common property, and that any damage must
be fully restored to the prior condition.
Therefore, plaintiffs are estopped from contesting the
validity of the Association.
II - Planned Community Act
 Several of plaintiffs' arguments on appeal concern the
Planned Community Act (the Act) which is found in Chapter 47F of
the North Carolina General Statutes. The Act is instrumental to
the instant case because it provides a basis for the Association to
fine plaintiffs. See N.C. Gen. Stat. § 47F-3-102(12) (2005).
Plaintiffs argue that the Act has no application to this case
because the Association is not an association within the meaning of
the Act. In addition, plaintiffs argue that applying the Act to
the instant case violates the contracts clause, substantive due
process, and procedural due process. North Carolina law is clear
that there is a presumption in favor of the constitutionality of a
legislatively enacted statute. Vinson v. Chappell, 3 N.C. App.
348, 350, 164 S.E.2d 631, 632-33 (1968), aff'd, 275 N.C. 234, 166
S.E.2d 686 (1969). Unless a statute clearly, positively and
unmistakably appears to be unconstitutional, then statutes are to
be upheld. Id. at 350, 164 S.E.2d at 633.
A. The Act's Application To the Instant Case
Plaintiffs contend that the Act has no application to this
case because the Association is not a lot owners' association under
the Act. We disagree.
Plaintiffs argue the Association was incorporated after the
conveyance of the first lot in violation of N.C. Gen. Stat. § 47F-
3-101 (2005) which requires a lot owners' association to be
incorporated no later than the date the first lot in the planned
community is conveyed. Id. However, the official comment of the
original version of the Act provided that the Act is effectiveJanuary 1, 1999 and applies in its entirety to all planned
communities created on or after that date except as provided
. . ., and N.C. Gen. Stat. § 47F-3-101 was not one of the
provisions that was noted to be applicable to pre-1 January 1999
communities. N.C. Gen. Stat. § 47F-1-102 (Official Comment) (1999).
Subsequently, this portion of the official comment was implemented
into the actual language of the statute. N.C. Gen. Stat. § 47F-1-
102 (2005). Accordingly, we disagree with plaintiffs.
B. Contract Clause
 Next, plaintiffs contend the trial court erred in granting
summary judgment in favor of the Association because retroactive
application of N.C. Gen. Stat. § 47F-3-102(12) and N.C. Gen. Stat.
§ 47F-3-107.1 (2005), as provided for by N.C. Gen. Stat. § 47F-1-
102(c), violates the contract clause of the United States
Constitution. We disagree.
N.C. Gen. Stat. § 47F-3-102(12) allows a homeowners'
association to impose reasonable fines or suspend privileges or
services provided by the association for reasonable periods for
violations of the declaration, bylaws, and rules and regulations of
the association. Id. N.C. Gen. Stat. § 47F-3-107.1 concerns,
among other things, the procedures a homeowners association must
follow when fining a homeowner pursuant to N.C. Gen. Stat. § 47F-3-
102(12). N.C. Gen. Stat. § 47F-3-107.1. Further, N.C. Gen. Stat.
§ 47F-1-102(c) creates a presumption that both N.C. Gen. Stat. §
47F-3-102(12) and N.C. Gen. Stat. § 47F-3-107.1 applies to all
planned communities created in North Carolina before 1 January1999. N.C. Gen. Stat. § 47F-1-102(c). Plaintiffs argue that
retroactive application of the above-referenced statutes
substantially changes the contract between the parties, in
violation of the contract clause.
Any law which enlarges, abridges or changes the intention of
the parties as indicated by the provisions of a contract
necessarily impairs the contract whether the law professes to apply
to obligations of the contract or to regulate the remedy for
enforcement of the contract. Adair v. Burial Assoc., 284 N.C.
534, 538, 201 S.E.2d 905, 908, appeal dismissed, 417 U.S. 927, 41
L. Ed. 2d 231 (1974). However, in Tabor v. Ward, 83 N.C. 291, 294-
95 (1880), the North Carolina Supreme Court stated:
It is well settled by a long current of
judicial decisions, state and federal, that
the legislature of a state may at any time
modify the remedy, even take away a common law
remedy altogether, without substituting any in
its place, if another efficient remedy
remains, without impairing the obligation of
Here, the provision of the Act does not disturb a vested
right, impair a binding contract or create a new obligation. The
provision merely provides an additional remedy for the enforcement
of the Declaration. See Byrd v. Johnson, 220 N.C. 184, 188, 16
S.E.2d 843, 846 (1941) ('Statutes directed to the enforcement of
contracts, or merely providing an additional remedy, or enlarging
or making more efficient an existing remedy, for their enforcement,
do not impair the obligation of the contracts.'). In addition,
the Act facilitates the intent of the parties by solidifying theimportance of the restrictive covenants. Bateman v. Sterrett, 201
N.C. 59, 62, 159 S.E. 14, 16 (1931) ([A] statute which facilitates
the intention of the parties neither impairs the obligation of the
contract, nor divests vested rights.). Accordingly, we disagree
C. Substantive Due Process
 Plaintiffs contend the trial court erred in granting
summary judgment in favor of the Association because retroactive
application of N.C. Gen. Stat. § 47F-3-102(12) and N.C. Gen. Stat.
§ 47F-3-107.1, as provided for by N.C. Gen. Stat. § 47F-1-102(c),
violates plaintiffs' substantive due process rights under the
United States Constitution and the North Carolina law of the land
provision. We disagree.
When confronted with a challenge to a validly adopted
statute, the courts must assume that the General Assembly acted
within its constitutional limits unless the contrary clearly
appears. Shipman v. N.C. Private Protective Services Bd., 82 N.C.
App. 441, 443, 346 S.E.2d 295, 296, appeal dismissed, disc. review
denied, 318 N.C. 509, 349 S.E.2d 866 (1986). For a statute to be
within the limits set by the federal due process clause and the
North Carolina 'law of the land' provision, all that is required is
that the statute serve a legitimate purpose of state government and
be rationally related to the achievement of that purpose. Id.
The Act does not violate plaintiffs' substantive due process
rights. A legitimate purpose of the Act is to provide a statutory
framework for dealing with modern real estate developments,particularly, planned communities. In addition, the individual
statutes that form the Act are rationally related to this purpose.
Accordingly, we disagree with plaintiffs.
D. Procedural Due Process
 Plaintiffs contend the procedure provided by the
Association violated plaintiffs' procedural due process rights
under both the Fourteenth Amendment and the North Carolina law of
the land provision. We disagree.
Our Supreme Court has stated that the mandate of procedural
due process contained in our Constitution and in the Fourteenth
Amendment applies only to actions by the government which deprive
individuals of their fundamental rights. Bank v. Burnette, 297
N.C. 524, 534, 256 S.E.2d 388, 394 (1979). Procedural due process,
as guaranteed by the Fourteenth Amendment 'restricts governmental
actions and decisions which deprive individuals of 'liberty' or
'property' interests within the meaning of the Due Process Clause
of the . . . Fourteenth Amendment.' Clayton v. Branson, 170 N.C.
App. 438, 452, 613 S.E.2d 259, 270, disc. review denied, 360 N.C.
174, 625 S.E.2d 785 (2005). In addition, the North Carolina
Supreme Court has noted that under the Fourteenth Amendment, [t]he
fundamental premise of procedural due process protection is notice
and the opportunity to be heard. Peace v. Employment Sec. Comm'n,
349 N.C. 315, 322, 507 S.E.2d 272, 278 (1998). Our state courts
generally treat the corresponding section of the N.C. Constitution
as the functional equivalent of its federal counterpart. Clayton,
170 N.C. App. at 451, 613 S.E.2d at 269. Here, the procedure provided by the Association did not
violate plaintiffs' procedural due process rights. First, we
question whether the creation of the statutory framework by the
legislature constitutes state action for procedural due process
purposes. See Giles v. First Virginia Credit Servs., Inc., 149
N.C. App. 89, 104-05, 560 S.E.2d 557, 567 (2002) (determining that
the statutory scheme providing for non-judicial repossession of
collateral did not constitute state action sufficient to evoke the
protection of the due process clause of the Fourteenth Amendment of
the United States Constitution). Next, even if the creation of the
statutory framework is sufficient state action, the Association did
not violate plaintiffs' procedural due process rights. Pursuant to
N.C. Gen. Stat. § 47F-3-107.1, the lot owner charged shall be
given notice of the charge, opportunity to be heard and to present
evidence, and notice of the decision. Id. Thus, the Act comports
with procedural due process requirements. Furthermore, the
Association provided plaintiffs with notice of the charge,
opportunity to be heard at a meeting, opportunity to present
evidence and notice of the decision. Accordingly, we disagree with
III - Conduct of the Association
,  Plaintiffs' final two contentions concern the conduct
of the Association. First, plaintiffs contend the Association's
conduct of the hearing violated any contract between the parties.
Next, plaintiffs contend that genuine issues of material fact existas to whether the Association discriminated against plaintiffs in
enforcement of the Declaration. We disagree.
Regarding the issue of the conduct of the hearing, plaintiffs'
brief contains no citation to any legal authority, and thus will be
taken as abandoned. N.C. R. App. P. 28(b)(6). Regarding the
contention that genuine issues of material fact exist as to whether
the Association discriminated against plaintiffs, plaintiffs have
admitted to having erected their staircase and door without the
Architectural Committee's approval, and did so in the face of
disapproval. Moreover, there does not appear to be any evidence of
discrimination on the part of the Association. Accordingly, we
disagree with plaintiffs.
IV - Attorney's Fees
 The Association contends the trial court erred in failing
to award reasonable attorneys' fees pursuant to N.C. Gen. Stat. §
47F-3-116(e) (2005). We disagree.
Rule 3(a) of the North Carolina Rules of Appellate Procedure
provides as follows:
Any party entitled by law to appeal from a
judgment or order of a superior or district
court rendered in a civil action or special
proceeding may take appeal by filing notice of
appeal with the clerk of superior court and
serving copies thereof upon all other parties
within the time prescribed by subdivision (c)
of this rule.
N.C. R. App. P. 3(a). Here, the Association filed its Cross
Notice of Appeal with the Clerk of the Court of Appeals, not with
the Clerk of Superior Court of Wake County. The requirement oftimely filing and service of notice of appeal is jurisdictional,
and unless the requirements . . . are met, the appeal must be
dismissed. Smith v. Smith
, 43 N.C. App. 338, 339, 258 S.E.2d 833,
835 (1979), disc. review denied
, 299 N.C. 122, 262 S.E.2d 6 (1980).
Although the Association states in its brief that the Cross Notice
of Appeal is on file with the trial court . . . and was in the file
with the trial court when counsel for [the Association] reviewed
the court file, no cross notice of appeal is in the record that
was filed with the trial court in order to give us jurisdiction.
See Blevins v. Town of West Jefferson
, 182 N.C. App. 675, 676-77,
643 S.E.2d 465, 467 (2007) ('Without proper notice of appeal, this
Court acquires no jurisdiction.'). (citation omitted).
Accordingly, we dismiss the Association's cross-appeal.
Chief Judge MARTIN and Judge TYSON concur.
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