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The city has charged Northbay subdivision property owner Richard Atkinson with violating a covenant that prohibits leasing property there. Both parties will meet in court at 1:30 on Friday.
The move comes more than a year after Madison officials enacted the ordinance. It gives the city authority to prosecute residents who don’t comply with the property usage agreements established by neighborhood homeowners associations.
Madison Mayor Mary Hawkins-Butler is confident that the city will prevail and believes the city has set a precedent that other municipalities will follow.
She said the ordinance has already shown signs of early success in and out of the courtroom. “Usually, residents comply before we go to court,” she said. “I feel we are on solid ground.”
Atkinson declined to comment last week and referred all questions to Jim Pierce, his attorney.
The ordinance was passed in late 2006 as a way to help the associations maintain property values in their neighborhoods. Also, it allows the city to partner with homeowners associations and incur legal costs when helping them enforce their covenants.
Under the ordinance, homeowners groups notify a resident or property owner that he or she has violated the code. The property owner then has 30 days to comply.
If the person in question doesn’t comply in that period of time, the homeowners association files an affidavit in city court and the city takes on the matter. Madison City Attorney John Hedglin will represent the city. He declined to comment on the matter last week.
ONE CITY JUDGE has upheld the ordinance’s constitutionality. But a similar ordinance considered last year by Ridgeland was rejected as unconstitutional by the state attorney general’s office.
Pierce won’t argue constitutionality on Friday, but will present two different points that he says will win the case. First, he said, Northbay changed the covenant without the proper authority to do so.
He also said the city doesn’t have the right to criminalize violating a covenant, which he believes is a private contract. Attorney General Jim Hood’s office agrees.
The office, last year, wrote in regards to the Ridgeland ordinance: “We have previously opined that restrictive covenants are generally private matters to be enforced by those for whose benefit the covenants were intended (i.e., homeowners associations, private landowners).”
Atkinson began leasing his home in the Northbay subdivision after he moved to another area in the Madison city limits.
In December 2006, while Atkinson’s home was still under lease, the Northbay Property Owners Association’s board of directors voted on a resolution prohibiting new lease and rental agreements.
Ray Howell, a Northbay employee, said current leaseholders were grandfathered into the new clause, but once those agreements were up, no one would be allowed to lease their property again.
But Atkinson violated that covenant by leasing his property again after the original agreement was up, Northbay officials said.
Pierce, though, maintains that the board didn’t have the right to pass the resolution. He said the board didn’t put it up for a vote before the neighborhood’s 500-plus homeowners.
In order for a covenant to be changed, it has to obtain 90 percent approval from Northbay’s homeowners, he said.
NORTHBAY PROPERTY Owners Association President Carlton Melton, though, disagrees with Pierce’s claim. And, he said he has a good feeling that the ordinance will be upheld in court.
Melton said the board took several months to develop the resolution and combed over the association’s bylaws before adopting the resolution. “After studying that, we realized we could come up a plan that would work for the neighborhood,” he said.
The roughly 20-year-old neighborhood, said Howell, has been affected by the recent downturn in the housing market. He said several homes bought for the purpose of being leased have been foreclosed on. “They were beginning to affect the neighborhood,” he said.
Melton said the board of directors was taking a proactive approach to help the situation and preserve the neighborhood’s atmosphere and property values. “We want to make this a good place to raise kids,” he said. “We feel we’re dong what the neighborhood wants us to do.”
The Northbay association faces another suit, which was filed in Madison Circuit Court. Two other cases are currently pending in regards to the new city ordinance in municipal court.
Despite what happens in court, he said the majority of Northbay residents have applauded the move. “If we didn’t receive pats on the back, we would’ve dropped the ball a long time ago,” he said.
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