On appeal from the Superior Court of New Jersey, Chancery Division, Atlantic County, Docket No. C-192-05.
The opinion of the court was delivered by: Lyons, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Wefing, Parker and Lyons.
Defendant Collings Lakes Civic Association (CLCA) appeals from the entry of a judgment finding that it does not have the right to increase a $48 annual charge to property owners absent their consent. The annual charge is contained in a deed restriction in their chain of title for the privilege of using the lakes, beaches, and certain recreational facilities of Collings Lakes. CLCA further appeals from the finding that it does not have the right to collect attorneys' fees from individual property owners in conjunction with litigation to collect the annual $48 charge, except as specifically permitted in applicable court rules.
Plaintiff Citizens Voices Association (CVA) cross-appeals from the provision in the judgment, which determined that the $48 annual owners' charge is valid and enforceable as to those property owners who are subject to a deed restriction containing the charge. The following factual and procedural history is relevant to our consideration of the issues advanced on appeal.
This matter arises out of a dispute among certain residents of Collings Lakes. Collings Lakes is a lake community formed in the 1950's consisting of approximately 1100 homes. There are four lakes and four dams in the community, along with playgrounds, beaches, and parking facilities. The Collings Lakes development covers a considerable amount of land in three municipalities (Buena, Folsom, and Monroe) and is situated in the counties of Atlantic and Gloucester. Certain master deeds were recorded when the development was created.*fn2 CLCA asserts that the master deeds of Collings Lakes place certain covenants and restrictions on all the parcels of land that make up Collings Lakes. A sample of the covenants and restrictions reads as follows:
Each lot hereinbefore referred to shall be subject to an annual charge of $48.00, and the Grantees, his, her, their or its heirs, successors, executors, administrators, and assigns, agree to pay to the Grantor, its successors and assigns, the sum of $48.00 for each lot annually, in advance, on the 1st day of each year or such other day as Grantor, its successors or assigns, shall designate hereafter, for beach, lakes, rivers, parking areas, boat landing and playground privileges, [whether] or not such privileges are exercised. The title in fee simple to land designated as beaches, lakes, rivers, parking areas, boat landings and playgrounds is to be retained by the Grantor, its successors and assigns, and the Grantee, his, her, their or its heirs, successors, executors, administrators and assigns, shall be subject to the Grantor's, its successors or assigns, rules and regulations now in force, or which may from time to time be made by the Grantor, its successors or assigns. It is expressly agreed that said charge shall constitute a debt which the Grantor, its [successors] or assigns, may collect by suit in any court of competent jurisdiction, and upon the passing of title to any of the land included in said tract, the owner or owners from time of acquiring title thereto, shall be held to have covenanted and agreed to pay Grantor, its successors or assigns, the aforementioned annual $48. charge; the said charge shall likewise constitute and be a first and prior lien on premises referred to herein, subject only to the lien of any real estate taxes, municipal water or sewer rents (if any), government-insured mortgages, or any other bona fide first mortgage which may hereafter be created or which may now exist thereon.
The Grantor, its successors and assigns, shall be the owner of said charge, debt or lien for the beach, lakes, rivers, parking areas, boat landing and playground privileges, and shall each spring and autumn clear the playgrounds, beaches, parking areas, and boat landings, and the woods immediately bordering thereon, to the end that reasonable usage and appearance of said will be maintained. Grantee, for himself, herself, themselves, or itself, his, her, their or its heirs, successors, executors, administrators and assigns, covenants and agrees that his right to use said beaches, lakes, rivers, parking areas, boat landings and playgrounds shall be subject to the rules and regulations which may from time to time be promulgated with reference thereto, and vests Grantor, its successors and assigns with the power to deprive any persons, including Grantee, members of his, her or their families, his, her, their or its heirs, successors, executors, administrators and assigns, of the use of such beaches, lakes, rivers, parking areas, boat landings and playgrounds, temporarily or permanently, for failure to comply with such rules and regulations.
Another deed provision states:
Failure to impose or enforce for any reason any restrictions, conditions, covenants or agreement herein contained, shall in no event be deemed a waiver of a right to do so thereafter; as to the same breach or as to one occurring prior or subsequently thereto, and invalidation of any one of these covenants by judgment or court order shall in no wise affect any of the other provisions, which shall remain in full force and effect, and any written approval by the Grantor, its successors and assigns, of any act shall be subject to any Municipal, County, State or Federal rules, regulations or laws.
While the language of the covenants in each master deed differs slightly, it is not disputed that each such master deed contains covenants which were substantially identical to the language set forth above. There is some dispute, however, as to whether all residents of Collings Lakes have taken title to their individual lots subject to master deeds containing the covenants and deed restrictions just described. We do not have the benefit, nor did the trial court, of a complete detailed title search as to all of the lots in the Collings Lakes community. Therefore, our opinion with respect to the issues advanced by the parties is only applicable to those lots encumbered by master deeds containing these and similar covenants and deed restrictions mentioned above.
In August 1956, Collings Lakes, Inc., the original developer, entered into a series of transactions. In one of the transactions, Collings Lakes, Inc. transferred to Collings Lakes Development Co. a substantial number of sub-divided lots. The record indicates that these lots constitute the dominant estates which maintain the right to enter upon and use the recreational areas, including the beaches and lakes. In an agreement (1956 Agreement) between Collings Lakes, Inc. as ...