Opinion
NO. COA10-842
08-16-2011
GEORGE C. LYLES, JR. and wife, BARBARA P. LYLES, Plaintiffs, v. CLAUDE TURNER and wife, PEGGY CATE TURNER, Defendants.
Law Offices of Travis S. Greene, PC, by Travis S. Greene, for plaintiff-appellees. David A. Lloyd for defendant-appellants.
An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
Polk County No. 08-CVD-131
Appeal by defendants from order entered 28 April 2010 by Judge Peter B. Knight in District Court, Polk County. Heard in the Court of Appeals 26 January 2011.
Law Offices of Travis S. Greene, PC, by Travis S. Greene, for plaintiff-appellees.
David A. Lloyd for defendant-appellants.
STROUD, Judge.
Defendants appeal from summary judgment order enjoining them from operating a bed and breakfast on the property which is the subject of this action. For the following reasons, we affirm.
I. Background
On 22 May 2001, plaintiff George C. Lyles, Jr. acquired by deed a tract of real property located in Polk County, North Carolina. On 1 June 2001, defendants acquired by deed a tract of real property adjacent to plaintiffs' tract. Both plaintiffs' and defendants' deeds contain eleven restrictive covenants. The first restrictive covenant contained in the deeds states: "The property shall be used for single family residential [and/or] agricultural purposes only and only one (1) single family dwelling along with reasonable and necessary outbuildings therefor shall be allowed to remain on the property."
Defendants began operating a bed and breakfast on their property. On 5 May 2008, plaintiffs filed a complaint against defendants alleging that defendants' operation of a bed and breakfast was a violation of the restrictive covenants. Plaintiffs' complaint requested injunctive relief, seeking to enjoin defendants from operating a bed and breakfast on their property, and damages for defendants' breach of contract. On 7 July 2008, defendants filed an answer which substantially denied the material allegations of plaintiffs' complaint and a counterclaim for an injunction which enjoined plaintiffs from violating the restrictive covenants.
On 12 December 2008, plaintiffs filed an amended complaint adding a claim for declaratory judgment. On 18 March 2009, plaintiffs filed a motion for partial summary judgment on their claim for declaratory judgment which was granted by the trial court on 29 April 2009. Defendants appealed the trial court's order for partial summary judgment; on 2 March 2010, this Court dismissed the appeal as interlocutory.
Thereafter, on 1 April 2010, plaintiffs filed a motion for summary judgment. The trial court determined
that Summary Judgment is hereby granted in favor of the Plaintiffs against the Defendants on the issue of injunctive relief, and the Defendants are hereby enjoined and restrained from operating a bed & breakfast on the property subject to this action. . . .Defendants appeal.
. . . Summary Judgment is hereby granted in favor of the Defendants against the Plaintiffs on the issue of breach of contract/restrictive covenants.
II. Interlocutory Appeal
Because the trial court's order does not address the counterclaim raised by defendants, the order is interlocutory. Atkins v. Peek, 193 N.C. App. 606, 609, 668 S.E.2d 63, 65 (2008) ("Where, as here, an order entered by the trial court does not dispose of the entire controversy between all parties, it is interlocutory.")
As a general rule, a party is not entitled to immediately appeal an interlocutory order. However, there are two exceptions in which an appeal of right lies from an order that is interlocutory. The first exception applies where the order represents a final judgment as to one or more but fewer than all of the claims or parties' and the trial court certifies in the judgment that there is no just reason to delay the appeal. Secondly, a party may appeal an interlocutory order where delaying the appeal will irreparably impair a substantial right of the party.Id. at 609, 668 S.E.2d at 65 (citation omitted). As the trial court did not certify the order for appeal, defendants must proceed by showing that a substantial right has been impaired. See id.
Whether a party may appeal an interlocutory order pursuant to the substantial right exception is determined by a two-step test. The right itself must be substantial and the deprivation of that substantial right must potentially work injury to [the party] if not corrected before appeal from final judgment. The substantial right test is more easily stated than applied. And such a determination usually depends on the facts and circumstances of each case and the procedural context of the orders appealed from.Wood v. McDonald's Corp., 166 N.C. App. 48, 55, 603 S.E.2d 539, 544 (2004) (citations, quotation marks, and brackets omitted) .
"The inability to practice one's livelihood has been recognized as a substantial right by our courts." Wade S. Dunbar Ins. Agency, Inc. v. Barber, 147 N.C. App. 463, 467, 556 S.E.2d 331, 334 (2001) . Accordingly, we agree that, under the circumstances presented in the instant case, a substantial right of defendants is affected by the trial court's order enjoining defendants from operating their bed and breakfast. Therefore, we reach the merits of defendants' appeal.
III. Summary Judgment
Defendants' sole argument on appeal is that the trial court "committed reversible error in granting plaintiffs' motion for summary judgment, permanently enjoining and restraining the defendants from operating a bed and breakfast in their home." (Original in all caps.) This Court reviews a trial court's grant of summary judgment de novo. Stafford v. County of Bladen, 163 N.C. App. 149, 151, 592 S.E.2d 711, 713, disc. review denied and appeal dismissed, 358 N.C. 545, 599 S.E.2d 409 (2004). "Summary judgment is proper when the pleadings, together with depositions, interrogatories, admissions on file, and supporting affidavits show that there is no genuine issue as to any material fact and that a party is entitled to judgment as a matter of law." Id.
Our Supreme Court set forth the law regarding construction of a restrictive covenant similar to the one we are considering in Hobby & Son v. Family Homes, which states that
[w]e begin our analysis of this case with a fundamental premise of the law of real property. While the intentions of the parties to restrictive covenants ordinarily control the construction of the covenants, such covenants are not favored by the law, and they will be strictly construed to the end that all ambiguities will be resolved in favor of the unrestrained use of land. The rule of strict construction is grounded in sound considerations of public policy: It is in the best interests of society that the free and unrestricted use and enjoyment of land be encouraged to its fullest extent. Even so, we pause to recognize that clearly and narrowly drawn restrictive covenants may be employed in such a way that the legitimate objectives of a development scheme may be achieved. Provided that a restrictive covenant does not offend articulated considerations of public policy or concepts of substantive law, such provisions are legitimate tools which may be utilized by developers and other interested parties to guide the subsequent usage of property.302 N.C. 64, 70-71, 274 S.E.2d 174, 179 (1981) (citations omitted).
As defendants do not contend that their use of their land is "agricultural" we limit our focus to the "single family residential" restriction. In Hobby & Son, our Supreme Court considered whether a family care home violated a restrictive covenant which limited property use to residential purposes. Id. at 65-70, 274 S.E.2d at 176-78. The Court noted that "resolution of this issue turns upon our construction of two phrases contained in the restrictive covenant upon which plaintiffs rely: 'residential purpose' and 'single-family dwelling.'" Id. at 70, 274 S.E.2d at 179. Based upon the characteristics of the family care home in question, the Court noted the distinction between the family care home, which operated as "an integrated unit rather than independent persons who share only the place where they sleep and take their meals as would boarders in a boarding house." Id. at 73, 274 S.E.2d at 180. In addition, our Supreme Court recognized that use of a property as a boarding house has been "widely held to violate restrictive covenants requiring that real property be utilized for residential purposes only." Id. at 71, 274 S.E.2d at 179.
Here, defendant Claude Turner's affidavit states that their bed and breakfast is used "for short-term paying overnight guests." Defendants do not contend that their guests qualify in any way as "family" or "an integrated unit[.]" See id. at 73, 274 S.E.2d at 180. It is clear that defendants' "short-term paying overnight guests" are "independent persons who share only the place where they sleep and take their meals as would boarders[.] " Id. Accordingly, defendants' operation of a bed and breakfast is not a "single family residential" use of their property, and therefore it violates the restrictive covenants in defendants' deed. As the operation of a bed and breakfast was in violation of the restrictive covenants, the trial court properly concluded "that there [wa]s no genuine issue of material fact and that . . . [plaintiffs were] entitled to judgment as a matter of law." Stafford, 163 S.E.2d at 151, 592 S.E.2d at 713.
IV. Conclusion
For the foregoing reasons, we affirm.
AFFIRMED.
Judges CALABRIA and HUNTER, JR., Robert N. concur.
Report per Rule 30(e).