Opinion:Crystal Bay Estates Homeowners’ Association v. Cox, 2022 OK CIV APP 38
Subject matter:Property–Covenants
Date Decided:March 25, 2022
Trial Court:District Court of Osage County; Judge Tate
Route to this Court:The Coxes appealed from a temporary injunction issued by the district court restraining them from construction on their tract of land.
Facts:The Coxes were constructing a home on Skiatook Lake in Osage County. Crystal Bay Estates has certain covenants attached to the properties in the community according to which the residents of the community must conform to and construct their homes. Complete construction plans of all the details of construction were to be submitted to an Architectural Committee, which approved the Coxes’ plans in March 2019. However, in October 2019 the Coxes altered the exterior plans for the home to use metal siding rather than the initially intended Fiberglass SIP. The Committee sought to resolve this issue with the Coxes, but they demonstrated an intent not to abide by the covenants and construct the home with metal siding which, according to the Crystal Bay Estates HOA, was inconsistent with the architecture, design, and quality of materials reflecting the other homes in the subdivision.
Crystal Bay HOA filed a petition for injunction, a temporary restraining order and a temporary injunction to prevent further construction on the home to prevent the home construction from being completed before a final judgment could be entered. The district court granted the restraining order, then granted the temporary injunction in order to maintain the status quo and prevent further construction on the home absent agreement by the Crystal Bay HOA approval of new plan proposals.
Standard of Review:“The standard of review for the grant or denial of an injunction is whether there was an abuse of discretion by the trial judge.” Murlin v. Pearman, 2016 OK 47, ¶ 17. “Matters involving the granting or denial of injunctive relief are of equitable concern. Accordingly, this Court will consider all evidence on appeal.” Edwards v. Bd. of Cnty. Comm’rs of Canadian Cnty., 2015 OK 58, ¶ 11.
Analysis:In order for Crystal Bay HOA to be entitled to a temporary injunction, it must show that it has a likelihood of success on the merits of its claim, that it would suffer irreparable harm if the injunction was denied, the threatened injury to the HOA outweighed the injury that the Coxes would suffer in being enjoined, and that the injunction was in the public interest.

The Court determined that the first prong carried the most weight in its analysis. In regard to the HOA and Architecture Committee’s discretion in deciding what materials a resident may use in constructing their home. The Court relied on the case Jackson v. Williams, 1985 OK 103, in which the Oklahoma Supreme Court stated that although restrictive covenants are not favored by law and receive strict construction that favors unencumbered use of the land, but that the intent of the parties controls. The Court rejected the Coxes’ argument that the Committee and the HOA have either unfettered discretion to accept or deny applications or no discretion at all. The Court decided that the Committee could exercise some discretion within reasonable bounds and in good faith based on the language in the covenants. Also, because all of the other homes in the subdivision were constructed from brick, stone, and wood, and the metal house was completely different from the rest of the homes in the subdivision, the HOA exercised reasonable discretion under the circumstances.

In regard to irreparable harm, the Court determined that it was not feasible to measure the effect of the construction of the modern industrial farmhouse on the property values of the surrounding homes, thus that harm could not be reduced to a certain amount for damages. Also, the Court reasoned that if the Coxes were allowed to build their metal home, then the restrictive covenants would be rendered ineffective and weaken the HOA’s authority. Thus, the HOA did not abuse its discretion.

In its conclusion, the Court determined that the harm the Coxes would suffer from the injunction was minimal because they resided in a rental home during construction of the Crystal Estates home. Also, public policy would support the enforcement of the covenants in accordance with the Jackson court, as the intent of the parties enforces the validity of covenants as long as they are within reasonable bounds, as they were here.
Vote:3-0. Fischer, C.J., Hixon, J., and Barnes, P.J. (author) concur.
Other: N/A