## Facts

- Trustees of the Melrose Towers Condominium Trust adopted a by-law amendment limiting any natural person or entity to ownership of no more than two units.
- The amendment was adopted under existing trust by-laws with written consent from unit owners holding 80.45% of the beneficial interest and was recorded.
- At the time of adoption, George J. Franklin, Jr. already owned six units in the condominium.
- Franklin entered a purchase-and-sale agreement with Daniel and Florence Clarke for an additional unit.
- After receiving notice under the master deed, the trustees declined to exercise a right of first refusal and instead asserted the sale violated the ownership-cap amendment.
- Franklin and the Clarkes filed a declaratory-judgment action challenging the amendment; the Clarkes nonetheless conveyed the unit to Franklin.
- The Superior Court upheld the amendment and declared the Clarke-to-Franklin deed null and void; the plaintiffs appealed, and the Supreme Judicial Court took direct appellate review.

## Issues

1. Whether a condominium trust by-law limiting ownership to two units per person or entity is an unreasonable restraint on alienation.
2. Whether voiding the sale under the by-law violates due process or equal protection under the state or federal constitutions.

## Decision

- The Supreme Judicial Court affirmed the Superior Court judgment.
- The two-unit ownership limitation was a reasonable restraint on alienation and therefore valid.
- Assuming without deciding that sufficient state action existed, the court held the amendment did not violate due process or equal protection.
- The deed from the Clarkes to Franklin was null and void under the valid by-law amendment.

## Legal Principles

- Reasonable restraints on alienation may be enforced; reasonableness turns on factors such as the proponent’s protectable interest, the restraint’s scope, and whether it serves a worthwhile purpose without seriously impairing the market.
- A condominium community may adopt and amend use and ownership restrictions pursuant to its governing instruments; purchasers take subject to recorded restrictions and authorized amendment procedures.
- Where no fundamental right or suspect class is implicated, restrictions are evaluated under rational basis review and are valid if rationally related to a legitimate objective.
- Maintaining a stable, owner-occupied residential character and discouraging absentee landlord concentration is a legitimate objective, and a unit-ownership cap may be rationally related to that objective.

## Conclusion

The court upheld a condominium by-law amendment capping unit ownership at two per person or entity as a reasonable restraint on alienation and, applying rational basis review, rejected due process and equal protection challenges, resulting in invalidation of a deed conveying an additional unit to an owner who already exceeded the cap.


Franklin v. Spadafora, 388 Mass. 764, 447 N.E.2d 1244 (1983)