## Facts

- Andy and Luisa Turudic bought property in the Susan Estates subdivision in Yamhill County, Oregon, after reviewing both the original (1981) CCRs and later amended CCRs.
- The Turudics kept two American mountain lions (cougars) as family pets and built an outdoor enclosure near their residence; there was no commercial use.
- The Susan Estates homeowners association, acting through its board and related parties, asserted the cougars and enclosure violated the CCRs as an impermissible residential use and as a “nuisance,” and demanded removal.
- The Turudics sought approval and offered additional safety measures, but the board denied permission without giving a CCR-based explanation and continued to insist on removal.
- A separate dispute involved neighbor John Albin’s placement of a portable toilet near the boundary with the Turudics’ lot; the Turudics contended it was a prohibited temporary structure under the original CCRs, while Albin and the association asserted it was permissible for agricultural use.
- After a bench trial, the circuit court found no objective basis to treat the cougars as an actual nuisance under either common law or the CCRs, but still ordered the cougars and enclosure removed as incompatible with residential use; it also allowed the portable toilet to remain as used.

## Issues

1. Whether keeping two pet cougars in an enclosure on the property violated the CCRs as nonresidential use or as a “nuisance.”
2. Whether the HOA board’s denial of approval and demand for removal was constrained by reasonableness and good faith, and whether the board acted unreasonably or capriciously.
3. Whether Albin’s portable toilet violated the original CCR prohibition on temporary structures, particularly when not connected to bona fide agricultural use.
4. Whether the trial court correctly resolved the parties’ competing claims and counterclaims for declaratory and injunctive relief concerning CCR enforcement.
5. Whether denial of post-judgment relief (setting aside judgment and sanctions) was error.

## Decision

- The Court of Appeals reversed the judgment for defendants on defendants’ second and third counterclaims.
- The Court of Appeals reversed and remanded the judgment for defendants on plaintiffs’ first and second claims for relief, and the judgment for Albin on plaintiffs’ third claim for relief.
- The court held that keeping the cougars as pets constituted a permitted “residential use” under the amended CCRs absent a showing of nuisance and absent specific covenant language prohibiting such pets.
- The court held the HOA could not rely on the CCR nuisance provision to prohibit the cougars where the trial court found no objective basis for nuisance; generalized fear was insufficient.
- The court held the board’s denial of approval, resting exclusively on an unsupported nuisance rationale, was unreasonable and capricious.
- The court held the portable toilet was a prohibited temporary structure under the original CCRs when not needed for genuine agricultural use; the trial court erred by allowing it to remain without that limitation.
- The court otherwise affirmed, including affirmance of the denial of post-judgment motions to set aside the judgment and for sanctions.

## Legal Principles

- CCRs are interpreted as contractual instruments; courts look to text and context and do not expand restrictions beyond what the covenants reasonably express.
- “Residential use” in CCRs may include keeping pets, including uncommon species, unless the covenants expressly exclude them or the use is shown to be a nuisance.
- A “nuisance” restriction in CCRs requires objective interference with neighboring use and enjoyment; subjective apprehension alone does not establish a covenant nuisance.
- HOA architectural or use-approval discretion is limited by an implied duty of reasonableness and good faith; discretionary authority cannot be used to prohibit an otherwise permitted category of use without covenant support.
- Structures characterized as temporary or shack-like may violate CCR bans on temporary structures when maintained indefinitely without a permitted, incidental purpose (such as bona fide agricultural operations).

## Conclusion

The court interpreted the CCRs to allow the Turudics to keep pet cougars as a residential use absent an objectively demonstrated nuisance, limited the HOA board’s discretionary enforcement to reasonable, good-faith decisionmaking, and held a portable toilet violated the CCRs when not tied to legitimate agricultural use, reversing and remanding key declaratory and injunctive rulings while affirming denial of post-judgment sanctions and set-aside relief.


Turudic v. Stephens, 176 Or. App. 175, 31 P.3d 465 (Or. Ct. App. 2001)