Tree
Cutting
Hartstene Pointe Maintenance Assoc. v. J.Diehl Court of Appeals Division II - State of Washington |
Docket Number: 22125-0-II
Title of Case: Hartstene
Pointe Maintenance Assoc. v. John E. Diehl
SOURCE OF APPEAL
JUDGES
COUNSEL OF RECORD
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON - DIVISION II HARTSTENE POINTE MAINTENANCE No. 22125-0-II
ASSOCIATION,
ARMSTRONG, J. -- John Diehl appeals a judgment that he violated the restrictive covenants of Hartstene Point when he cut down a tree on his property. Because the architectural control committee was not properly constituted when it denied Diehl's tree cutting application, we reverse the judgment in part. FACTS Hartstene Pointe is a 530-lot community formed by a subsidiary of the Weyerhaeuser Corporation on Hartstene Island in Mason County. Lots in the community are subject to restrictive "Covenants, Conditions, and Restrictions" (CC&Rs), whose purpose is "to protect the value and desirability of the aforesaid real property." These covenants are enforced by an Architectural Control Committee (ACC), appointed by the Hartstene Point Maintenance Association's Board of Directors (HPMA). Article VI of the CC&Rs governs "Architectural
Controls," and provides, in relevant part:
Following a six day trial, the trial court invalidated fines against Diehl in the amount of $4,500, finding that the HPMA documents did not authorize the Board or the ACC to impose fines. But the court did find that Diehl "violated the laws of Hartstene Pointe when he cut the 26" cedar tree. " The trial court concluded that "{b}ecause defendant violated the laws of Hartstene Point, he is subject to the penalties contained within those laws." The trial court ruled in favor of Diehl on several other issues, not the subject of this appeal, and thus ruled that neither party was entitled to attorney's fees. Diehl raises a number of challenges to the Board's action, including that the ACC was not properly constituted under the governing documents for the community. Because our decision on this issue is dispositive, we do not address Diehl's other arguments. ANALYSIS
Diehl contends that the ACC was not properly composed at the time it denied his tree-cutting application, and therefore the denial was improper. Diehl claims that the ACC did not meet
the requirements of either the CC&Rs or of RCW 24.03.115. Article VI
of the CC&Rs states that appropriate applications "shall have been
submitted to and approved in writing . . . by the Board of Directors of
the Association, or by an architectural control committee composed of three
members appointed by the Board." Further, RCW 24.03.115, which governs
nonprofit corporations and associations in Washington, provides in relevant
part:
RCW 24.03.115. The HPMA does not dispute that the ACC consisted of five members of the HPMA, only one of whom was a member of the Board of Directors. But the HPMA argues that the CC&Rs language does not limit the members of the ACC. This argument contradicts the plain language of the CC&Rs and the statute. The CC&Rs authorize an architectural committee of three members, not three or more. And under the HPMA's reasoning, there would be no limit on the number of committee members, either more or less than three. This would render the language of the CC&Rs meaningless. Further, the argument ignores the statutory mandate that such committees consist of two or more directors. Thus, even if the CC&Rs are read to allow more than three members, the make-up of the ACC here was flawed because it contained only one board member. And the HPMA does not deny that it is a nonprofit corporation governed by RCW 24.03.115. Rather, the HPMA argues that a Washington nonprofit corporation may deviate from the RCW requirements by amending its founding documents, citing Barnett v. Hicks, 114 Wn.2d 879, 792 P.2d 150 (1990). But nothing in the record shows that the "founding documents" have been amended. The only copy of the articles of incorporation in the record does not mention the ACC. And the only copy of the bylaws in the record explicitly provides that the directors have the power to appoint an ACC "consisting of two or more directors, and to delegate to the said Committee authority to interpret, administer, and enforce the covenants." Further, article IX of the bylaws states that "The Board of Directors shall appoint an Architectural Control Committee . . . as hereinbefore provided." No other "founding documents" are before this court. Moreover, Barnett did not hold that nonprofit corporations may alter statutory requirements by amending their founding documents. The issue in Barnett was whether Washington statutes and the articles of incorporation permitted a non-board member to exercise veto power over board actions. The court held that RCW 24.03.115 did not apply to the question. Barnett, 114 Wn.2d at 884. Barnett did not address the issue of whether nonprofit corporations could alter the statutory requirements concerning committee composition. Finally, although it did not advance the argument before the trial court, the HPMA now contends that Diehl cannot challenge the composition of the ACC because of RCW 24.03.040, which limits the use of ultra vires. That statute provides: No act of a corporation and no conveyance or transfer of real or personal property to or by a corporation shall be invalid by reason of the fact that the corporation was without capacity or power to do such act or to make or receive such conveyance or transfer, but such lack of capacity or power may be asserted . . . . RCW 24.03.040. None of the exceptions apply. The phrase "ultra vires" describes corporate transactions that are outside the purposes for which a corporation was formed and, thus, beyond the power granted the corporation by the Legislature. Twisp Mining & Smelting Co. v. Chelan Mining Co., 16 Wn.2d 264, 293-94, 133 P.2d 300 (1943) (citations omitted). But Diehl does not contend that the HPMA lacked authority to regulate the architectural development of the community. Rather, he argues only that the way in which such control was exercised in his case did not conform with the governing documents of the corporation. This is not a challenge to the authority of the corporation, but only to the method of exercising it. And to hold that such a challenge is barred by ultra vires would be to hold the regularly adopted corporate procedures a nullity. If, as HPMA suggests, RCW 24.03.040 prevents Diehl's challenge, the corporation would be free to disregard its own bylaws that prescribe the make-up of committees. In short, the corporate articles and bylaws would be largely meaningless.
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