The case involves a legal dispute between Sully Station II Community Association, Inc. and eight of its members regarding a parking policy enacted by the Association's board of trustees for the common area in Section 8 of the Sully Station II residential community. The trial court declared this policy void and unenforceable, leading to the Association's appeal. The Complainants sought declaratory and injunctive relief to ensure their right to use the common area for parking equally with other unit owners.
The Association, structured as a non-stock corporation under the Virginia Property Owners’ Association Act, operates under governing documents which include a Declaration and Supplementary Declaration, both recorded in Fairfax County. These documents serve as a contract among all townhouse owners in Section 8, requiring adherence to their clear and unambiguous terms.
The controversy centers on Section 8, which has 77 townhouses, including 38 with garages and driveways and 39 without. The common area has 94 parking spaces, classified as both "Common Area" and "Cluster Common Area." A parking policy adopted on October 1, 1997, assigned two reserved spaces to each non-garaged townhouse while providing no reserved spaces for garaged townhouses, designating remaining spaces for overflow and visitor parking on a first-come, first-served basis. The court upheld the trial court's declaration, affirming that the new policy was inconsistent with the intentions of the governing documents.
Seventy-eight of the ninety-four parking spaces in the common area were designated for thirty-nine non-garaged townhouses, leaving sixteen spaces unassigned for first-come, first-served use. The legal dispute involved whether the Association's parking policy constituted a licensing of common area use, as claimed by the Complainants, or a regulatory rule as argued by the Association. This debate was rooted in Article IV of the Declaration, particularly regarding members' rights to enjoy common areas and the Association's rights to license and regulate those areas. The Association acknowledged that its policy did not treat owners uniformly, which would violate the Declaration if deemed a license. The trial court ruled that the policy was indeed a licensing arrangement not adhering to uniform standards, rendering it invalid and unenforceable as an ultra vires act. The Association contended that the trial court erred by classifying the policy as a license, arguing that the omission of a uniformity requirement in the relevant section of the Declaration indicated intent to allow broad rule-making authority. The Association referenced case law and other provisions in the Declaration to support its position that the parking policy should be seen as a regulation, not a license.
Article IV grants the Association the authority to license parts of the common area on a uniform basis and to set rules for its use. Article VI, Section 1(d) mandates that the Board of Trustees adopt general rules to address potential issues related to property use and member well-being, including vehicle storage and use. The Association refers to Article IV of the Supplementary Declaration on 'Parking,' which allows the promulgation of rules to regulate parking areas for all Owners, potentially including parking space assignments. Additionally, Article V, Section 3 of the Supplementary Declaration establishes that vehicle use and storage on common areas or adjacent streets must comply with rules set by the Board of Trustees.
The Association asserts that all references to the Board's authority regarding parking pertain strictly to regulatory rules rather than licensing. It claims the trial court's conclusion that the parking policy constituted a licensing of common area contradicts the clear language of both the Declaration and Supplementary Declaration, which indicate that space assignments are regulatory measures. The Association cites Virginia case law, particularly Bunn v. Offutt, to define a license as a right given by an authority that would otherwise be illegal, tortious, or trespassory. It argues that the parking policy does not grant such authority since parking in assigned spaces was not illegal prior to the policy's adoption; these spaces were available on a first-come, first-served basis. Thus, the Association contends that the policy did not create a license for parking but rather exercised regulatory power.
Parking in a common area prior to the adoption of the Association's parking policy would not have been illegal for Mr. Smith. However, it was determined that he could not lawfully exclude his neighbors from these spaces before the policy was enacted. The parking policy granted a special privilege, allowing non-garaged townhouse owners to prevent garaged townhouse owners from using seventy-eight parking spaces in the common area, which is characteristic of a license. The trial court noted that the policy was not applied uniformly, violating the Declaration. The Association referenced several out-of-state cases to argue that the policy was a regulatory exercise rather than a license. However, the complainants contended these cases actually supported their position. The court found the Association's arguments unpersuasive and affirmed the trial court's judgment. Justice Compton, dissenting, argued that the parking policy should be viewed as a regulation under the governing documents, citing specific language in the Supplementary Declaration that allows the Board of Trustees to promulgate rules for parking management, rather than granting a license. Justice Compton would have reversed the trial court's decision.
