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Villas by the Sea Owners Ass'n v. Garrity

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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2000 ME 48
Docket:	Yor-99-253
Argued:	January 4, 2000
Decided:	March 14, 2000

Panel:WATHEN, C.J., and CLIFFORD, RUDMAN, DANA, SAUFLEY, ALEXANDER, and
CALKINS, JJ.

VILLAS BY THE SEA OWNERS ASSOCIATION

v.

MICHAEL GARRITY et al.

CLIFFORD, J.

	[¶1]  Villas by the Sea Owners Association appeals from a judgment
entered in the Superior Court (York County, Crowley, J.) declaring, after a
jury-waived trial, that Michael and Patricia Garrity owned a "loft" as part of
their condominium unit, and from a judgment (Cole, J.), likewise following a
jury waived trial, in favor of the Garritys on their counterclaim for breach of
contract for the failure of the Association to turn over rental revenues that it
had held in partial payment of a fine assessed against the Garritys for their
use of the loft.  The Association contends that both judgments should be
vacated because they are predicated on the court's erroneous finding that
the loft was part of the condominium unit and not a common area.  We find
no error, and we affirm the judgments.
	[¶2]  Villas by the Sea Resort Motel Condominium is a vacation
complex in Wells.{1}  The Villas by the Sea Owners Association was organized
for the benefit of the unit owners to manage and administer the rental of the
units.  Michael and Patricia Garrity purchased Unit 14F at auction in 1993.{2} 
In 1995, the Garritys finished a portion of the building referred to by the
parties and by the developer, described in the plans, as a "loft."  The loft is
situated above the Garritys' third floor unit.  The loft finished by the Garritys
occupies only a portion of the area above the third floor unit, however; the
other portion is a cathedral ceiling that is clearly a part of unit 14F.  The
cathedral ceiling is an original feature of the unit.  As the building was
constructed, however, there was no access to the loft: the Garritys cut
through to the loft area, installed a pull-down stairway, hung sheetrock on
the interior walls and trusses of the loft, and laid a plywood floor in the loft
area.  No other structural changes were made.  The parties stipulated that
two other units in the condominium also had finished lofts constructed by
the developer, one owned by the Association for use as part of its office, and
another owned by a private party.
	[¶3]  The Association brought a complaint against the Garritys seeking
a judgment declaring that the use of the loft area by the Garritys violated the
condominium declaration because the loft is a common area.  The
Association alleged that the Garritys were excluding other owners from the
area, and further that they were trespassing on the common area.  The
Association also asserted that even if the Garritys did own the loft area, their
use of it was otherwise in violation of the declaration.  The Garritys
counterclaimed, alleging that the loft was part of their unit, and claiming
that the Association had breached the Association Agreement.
	[¶4]  At trial, the president of the Association testified that, at the
time of the auction at which the Garritys purchased the unit, no one was
given access to the loft area, nor did anyone ask about this space.  He further
testified that one of the walls that the Garritys had finished was load-bearing. 
He also stated that the loft in the Association's unit had been closed since
the commencement of this litigation because "structurally it will not hold
the weight."  The manager of the Association testified to the effect that the
loft area was built using 2 x 6 lumber, and not with the 2 x 10 lumber
commonly required to support the weight of a person, and used throughout
other areas in the condominium structure.
	[¶5]  The parties agreed that the issue of ownership of the loft area
was controlled by the Condominium Declaration and by the plats and plans
for the development.  The declaration contained the following provision:

3.	Unit Numbers and Boundaries.  Reference is made to the
recorded plat and plans referred to in Section 1 hereof for the
identification number of each unit showing the location and
dimensions of its boundaries.  The boundaries of each unit are the
interior unfinished surfaces of the floors, ceilings and walls separating
the units from common areas or from other units.  All floor and wall
coverings, including linoleum, polyurethane, carpeting, paint,
wallpaper, etc. are included within the boundaries of a unit.  The
provisions of Section 1602-102 of the Maine Condominium Act are
adopted and incorporated herein by reference.

Also, before the court were a number of drawings, including the following
depiction of the floor plan:
	
	[¶6]  In reaching its conclusion that the Garritys owned the loft area,
the Superior Court (Crowley, J.) concluded that: the declaration was
ambiguous on its face; the incorporated drawings contained different
measurements regarding the size of the loft; the actual square footage of
each unit was not as indicated on the drawings; and the cathedral ceilings
present in the top floor units were not indicated in the drawings.  In
addition, the court noted that the developer had finished at least two of the
loft spaces.  According to the court, the condominium plan was "woefully
inadequate and [did] not meet the requirements of the Maine Condominium
Act."
	[¶7]  Because the developer had finished some of the lofts, the court
found it "reasonable to infer that the developer intended that the loft area
be within the boundaries of all top floor units."  The court also noted that
the term "loft," in its most usual sense, referred "to an upstairs room which
is part of a dwelling or working area below."  Finally, the court found that,
had the developer intended that the loft area not be part of the unit, it
would have labeled this a "common area" rather than a "loft."  The court
also stated that "[n]othing in [its] opinion is to be construed as having effect
on state or local laws and/or condominium rules and regulations which
pertain to the use of the loft area (as opposed to the issue of ownership) in
[the Garritys' unit]."  Following this judgment, and on motion of the Garritys,
the Superior Court (Fritzsche, J.) entered a summary judgment in favor of
the Garritys on the remaining counts of the Association's complaint, but
denied the Garritys' motion for summary judgment on their breach of
contract claim.
	[¶8]  On the Garritys' counterclaim for breach of contract, the court
(Cole, J.) found that the Association had wrongfully withheld $1,494.69 from
the Garritys.  Notwithstanding the Association's claim that it remained
entitled to this amount as a fine for violations of state and local law, the
court held that the Association was precluded from pursuing this claim by
the prior declaratory judgment in the Garritys' favor.  The court denied
cross-motions for attorney fees, and this appeal followed.
	[¶9]  Whether or not a contractual term is ambiguous is a question of
law.  See Tondreau v. Sherwin-Williams Co., 638 A.2d 728, 730 (Me. 1994). 
If a contractual provision is unambiguous, it will be given its plain, ordinary,
and generally accepted meaning.  See Bangor Publ'g Co. v. Union St. Mkt.,
1998 ME 37, ¶ 5, 706 A.2d 595, 597.  Interpretation of such a contract is a
matter of law.  See Town of Lisbon v. Thayer Corp., 675 A.2d 514, 516
(Me. 1996).  On the other hand, a contractual provision is considered
ambiguous if it is reasonably possible to give that provision at least two
different meanings.  See Cambridge Mut. Fire Ins. Co. v. Vallee,
687 A.2d 956, 957 (Me. 1996).  Construction of an ambiguous contract is a
question of fact determined by the fact-finder and reviewed for clear error. 
See Town of Lisbon, 675 A.2d at 516.
	[¶10]  When a contract is found to be ambiguous, a court may look to
extrinsic evidence of the intent of the parties.  See Bangor Publ'g Co.,
1998 ME 37, ¶ 5, 706 A.2d at 597.  Additionally, the court may look to
extrinsic evidence to reveal a latent ambiguity.  See Interstate Indus. Unif.
Rental Serv., Inc. v. F.R. Lepage Bakery, Inc., 413 A.2d 516, 519 (Me. 1980)
(allowing evidence of negotiations and prior agreements in order to
determine whether a contract was completely or partially integrated); cf.
Snyder v. Haagen, 679 A.2d 510, 513 (Me. 1996) (allowing extrinsic
evidence that application of a deed's boundary description to the ground
revealed that the description was unclear). 

I.

	[¶11]  The Association claims that the declaration and unit boundary
plan, read in light of the Maine Condominium Act, unambiguously
demonstrate that the loft area is not part of the Garritys' unit.  We disagree.
	[¶12]  The Association points to paragraph three of the declaration. 
The paragraph states that "[t]he boundaries of each unit are the interior
unfinished surfaces of the floors, ceilings and walls separating the units from
common areas or from other units."  (Emphasis added.)  This provision,
however, cannot exclusively define what is part of a unit because it relies, in
part, upon a preexisting determination of what a common area is.  The
provision, then, would be definitive in the Association's favor only if it were
already known that the loft area was a common area or part of another unit. 
Interpreted otherwise, this provision would mean that the surface of any
wall, even an interior one, could be a unit boundary.  Nevertheless, the
Association suggests that "[t]here can be no other conclusion [than] that the
unit boundary does not include the unfinished loft area."  This conclusion
does not necessarily follow.  Paragraph three does not by itself define where
the boundary is; rather, once a boundary is located, it provides for the
precise nature of that boundary.  Accordingly, the Association's contention
that this provision unambiguously identifies the loft as a common area is not
persuasive.
	[¶13]  Neither does the statutory language resolve the issue in favor of
the Association.  Although 33 M.R.S.A. § 1602-102 (1998){3} echoes
paragraph three of the declaration, section 1601-103 defines "common
elements" as "all portions of a condominium other than the units."  33
M.R.S.A. § 1601-103(4) (1998).  Thus, paragraph three of the declaration
defines what is part of the unit partially in terms of what is a common area,
and the statute defines common elements (which comprise the common
area) in terms of what is a unit.  Accordingly, these definitions are circular
with respect to each other, and the declaration read together with the
statute is ambiguous as to whether the loft is part of the unit or is part of the
common area.
	[¶14]  Moreover, the plan for the structure, which would seem to be
the best indicator of the intent of the developer, is ambiguous because the
structure, as built, does not conform to the plan.  The drawing does not
show the cathedral ceilings that grace the top floor units-this area on the
drawings is also part of what is labeled "loft."  Thus, the line on the drawing
between the third floor units and the loft area is of uncertain meaning, and
because the cathedral ceiling is above this line, the line clearly cannot mean
that the entire portion marked "loft" is common area.  The court correctly
concluded that the plan and declaration are ambiguous with respect to
ownership of the loft.

II.

	[¶15]  Once it determined that the declaration was ambiguous, the
court was persuaded by the extrinsic evidence that the loft area was part of
the Garritys' unit.  The Association does not forcefully contend that there is
no competent evidence to support the court's conclusion, but does argue
that the court gave improper weight to that evidence.  We review the trial
court's determination for clear error.  See Town of Lisbon, 675 A.2d at 516.
	[¶16]  The court's finding is amply supported by the extrinsic
evidence.  Because the developer had finished at least two of the lofts and
because the plan did not distinguish between units with finished lofts and
those without, the court inferred that it was the developer's intent that the
loft areas be a part of the top floor units.
	[¶17]  Moreover, the court relied on the ordinary meaning of the term
loft.  The court found that "loft" referred to "an upstairs room which is part
of a dwelling or working area."  This definition is supported by Webster's
Seventh New Collegiate Dictionary, which defines loft as "a room or floor
above another:  ATTIC."  Webster's Seventh New Collegiate Dictionary 497
(1970 ed.).{4}  The court then concluded that, had the developer intended
that the loft area be considered "common," the developer would have
chosen to label this area as such.  We find no error in the court's conclusion
that the loft area in question{5} was a part of the unit owned by the Garritys
and not a common area.  Because the court did not err in its conclusion as to
the ownership of the loft, we affirm the court's judgment in favor of the
Garritys on their counterclaim as well.
	The entry is:
Judgments affirmed.

Attorney for plaintiff:

Durwood W. Parkinson, Esq., (orally)
Bergen & Parkinson, LLC
62 Portland Road
Kennebunk, ME 04043

Peter L. Thompson, Esq., (orally)
Coles & Thompson, LLC
P O Box 1028
Kennebunk, ME 04043