## Facts

- Sun Valley Lake was developed as a lake resort community subject to recorded restrictive covenants and administered by a homeowners’ association.
- In 1988, the developer recorded covenants authorizing per-lot annual assessments but exempting the developer and any successor developer from assessments on lots it owned.
- The 1988 covenants allowed amendment “by the affirmative vote of a majority of the Owners of all Lots in the Development.”
- After ownership changes, Sky View Financial, Inc. became successor developer; it also transferred certain lots to its shareholders, Anderson and Sollars, as individual owners.
- In 1993, the association adopted amendments at an annual meeting using a one-owner/one-vote system, regardless of how many lots an owner held.
- The 1993 amendments (1) changed the amendment voting formula to one-owner/one-vote and (2) removed the developer/successor-developer assessment exemption, after which the association assessed Sky View.
- Sky View, Anderson, and Sollars sought declaratory relief asserting the 1993 amendments were invalid because they were not adopted under the 1988 amendment procedure.
- The district court granted summary judgment for plaintiffs, declaring the 1993 amendments null and void; the association and individual owners appealed.

## Issues

1. Whether the 1988 amendment clause requiring approval by “a majority of the Owners of all Lots in the Development” means a majority calculated on a one-vote-per-lot basis rather than one vote per owner.
2. Whether the 1993 amendments were valid when adopted using a one-owner/one-vote method inconsistent with the 1988 amendment procedure.

## Decision

- The Iowa Supreme Court affirmed summary judgment for Sky View, Anderson, and Sollars.
- The court interpreted the 1988 amendment language to require approval by a majority measured by lots (one vote per lot).
- Because the 1993 amendments were adopted using one-owner/one-vote, they did not comply with the required amendment method and were void.
- As a result, the 1988 covenants remained controlling, including the successor-developer assessment exemption for Sky View’s developer-held lots.

## Legal Principles

- Restrictive covenants are construed with attention to the parties’ intent as expressed in the instrument read as a whole, considered in context and in light of the development’s scheme.
- Where a declaration specifies an amendment procedure, that procedure must be followed; amendments adopted by a materially different voting method are invalid.
- Language referring to “Owners of all Lots” may be construed as tying voting power to lots, particularly where obligations (such as assessments) operate on a per-lot basis.

## Conclusion

The court held that the declaration required amendments to be approved by a majority calculated by lots, not by owners, and therefore invalidated amendments adopted under a one-owner/one-vote approach, leaving the original covenants in effect.


Sky View Fin., Inc. v. Bellinger, 554 N.W.2d 694 (Iowa 1996)