## Facts

- Mercia Heights was a residential subdivision governed by restrictive covenants, including objective building limits and a discretionary “consent to construction” approval clause.
- William and Carolyn Riss bought a lot with an existing home and planned to demolish it and build a new residence.
- The Risses’ proposed plans complied with the covenants’ objective requirements (including dimensional limits such as height and size).
- The homeowners association/architectural decisionmakers rejected the plans under the consent clause.
- In opposing the project, association leaders relied on and circulated inaccurate claims that the plans violated covenants and did not adequately investigate the plans’ actual specifications.
- The association proposed conditions and design changes that exceeded the written covenants (including additional view- and design-related requirements).
- The broader membership voted to uphold the rejection after the association actively advocated for that result.
- The Risses sued, alleging the consent-clause decision was an unreasonable, arbitrary, and bad-faith use of discretionary covenant authority.

## Issues

1. How should courts interpret subdivision restrictive covenants: by strict construction favoring free use of land or by construing covenants to effectuate intended purposes in light of surrounding circumstances and homeowners’ collective interests?
2. When covenants grant discretionary design-approval authority, is that discretion constrained by reasonableness and good faith even if the covenants lack express standards?
3. Under the proper framework, was the Mercia Heights association’s rejection of the Risses’ plans valid?

## Decision

- The Washington Supreme Court affirmed the Court of Appeals and the trial court.
- The court adopted a purpose-based approach to interpreting subdivision covenants, emphasizing their intended purposes and the collective interests of homeowners.
- The court held that discretionary approval power under a consent-to-construction clause must be exercised reasonably and in good faith.
- The court agreed that the association’s rejection was unreasonable and arbitrary because it rested on misinformation and imposed extra-covenantal criteria.
- The judgment left in place only a limited, permissible requirement related to exterior appearance; otherwise, the rejection and most imposed conditions were invalidated.

## Legal Principles

- Restrictive covenants in modern residential subdivisions are construed to give effect to their intended purposes, considering surrounding circumstances and protecting homeowners’ collective expectations, rather than reflexively favoring free land use.
- A homeowners association or architectural review body exercising discretionary approval authority must act reasonably and in good faith.
- Discretionary covenant enforcement is improper when based on inaccurate information, inconsistent application, or conditions that effectively add to or rewrite objective covenant requirements without support in covenant purposes and text.
- A consent-to-construction clause does not authorize arbitrary rejections of otherwise covenant-compliant building plans.

## Conclusion

The court upheld relief for the homeowners whose compliant building plans were rejected, holding that subdivision covenants should be interpreted to effectuate their purposes and that HOA architectural discretion must be exercised reasonably and in good faith, not through arbitrary or misinformation-driven decisionmaking.


Riss v. Angel, 934 P.2d 669 (Wash. 1997)