## Facts

- Southwind is a common-interest residential subdivision subject to recorded restrictive covenants.
- The covenants required each lot to be used exclusively for single-family residential purposes and barred business activities, including “home occupations,” on the lots.
- After buying their home, David and Wilai Burden operated a fee-based childcare/daycare service in their residence, caring for up to six children on a regular schedule and receiving compensation.
- In July 2008, the homeowners’ association notified the Burdens that the daycare violated the covenants; they continued operating.
- In September 2010, the association sued to enjoin the daycare as a covenant violation.
- The Burdens argued that Nebraska’s Quality Child Care Act and related public policy favoring childcare limited enforcement of the covenants.
- The district court granted summary judgment to the association and entered a permanent injunction barring operation of the daycare on the property.

## Issues

1. Whether the restrictive covenants were ambiguous when applied to an in-home, fee-based daycare operation.
2. Whether operating a regular, compensated daycare in the home constituted a prohibited “business” or “home occupation” inconsistent with “single-family residential purposes.”
3. Whether the Quality Child Care Act or public policy rendered the covenants unenforceable or barred injunctive relief.
4. Whether the association was entitled to summary judgment and a permanent injunction on the undisputed facts.

## Decision

- The Nebraska Supreme Court affirmed.
- The covenants were unambiguous and enforceable according to their plain language.
- The Burdens’ daycare was a prohibited business/home occupation under the covenants and was inconsistent with the lots’ restricted residential use.
- The Quality Child Care Act did not preempt or invalidate private restrictive covenants and did not bar injunctive enforcement.
- Because the material facts were undisputed and only legal interpretation remained, summary judgment and a permanent injunction were proper.

## Legal Principles

- Summary judgment is proper when the record shows no genuine dispute of material fact and the movant is entitled to judgment as a matter of law.
- Restrictive covenants are interpreted like contracts; unambiguous covenants are enforced as written to carry out the parties’ intent expressed in the text.
- Regular, compensated in-home childcare with multiple clients constitutes a “business” or “home occupation” when covenants broadly prohibit commercial activity and home occupations.
- A licensing/regulatory statute governing childcare does not create a right to operate contrary to private covenants absent express or implied preemption or a clear statutory command.

## Conclusion

The court enforced clear residential-use and anti-business covenants to permanently enjoin a homeowners’ in-home, fee-based daycare, holding that the childcare regulatory statute did not supply a public-policy or preemption basis to defeat private covenant enforcement.


Southwind Homeowners’ Ass’n v. Burden, 283 Neb. 522, 810 N.W.2d 714 (Neb. 2012)