Sea Breeze Condominiums & Resort Owners' Association, Inc. v. T. Jackson Lyons and Reb McMichael

IN THE SUPREME COURT OF MISSISSIPPI NO. 2025-IA-00398-SCT SEA BREEZE CONDOMINIUMS & RESORT OWNERS’ ASSOCIATION, INC. v. T. JACKSON LYONS AND REB McMICHAEL DATE OF JUDGMENT: 03/25/2025 TRIAL JUDGE: HON. JENNIFER T. SCHLOEGEL TRIAL COURT ATTORNEYS: EVELYN T. PORTIE THOMAS LYNN CARPENTER, JR. COURT FROM WHICH APPEALED: HARRISON COUNTY CHANCERY COURT ATTORNEYS FOR APPELLANT: THOMAS LYNN CARPENTER, JR. JACK FITZGIBBON HALL ATTORNEYS FOR APPELLEES: EVELYN T. PORTIE T. JACKSON LYONS NATURE OF THE CASE: CIVIL - OTHER DISPOSITION: AFFIRMED AND REMANDED - 09/10/2026 MOTION FOR REHEARING FILED: BEFORE KING, P.J., ISHEE AND GRIFFIS, JJ. KING, PRESIDING JUSTICE, FOR THE COURT: ¶1. Condo owners Jackson Lyons and Dr. Reb McMichael (collectively, “Lyons”) filed a lawsuit against Sea Breeze Condominiums & Resort Owners’ Association, Inc. (Sea Breeze), following Sea Breeze’s fining of Lyons for failing to remove glass artwork from his terrace wall. The county court dismissed Lyons’s equity claims and granted summary judgment as a matter of law in favor of Sea Breeze. The chancery court reversed the county court’s grant of summary judgment, finding that the county court had abused its discretion by granting summary judgment before the parties had conducted discovery. We affirm the judgment of the chancery court. FACTS AND PROCEDURAL HISTORY ¶2. Sea Breeze is a nonprofit corporation that governs and operates a condo complex in Harrison County. The condo property consists of a ten-story waterfront building comprised of 101 apartment dwellings and twelve poolside cabanas. ¶3. On November 10, 2006, Sea Breeze filed with the chancery clerk of Harrison County a declaration of condominium, restrictive covenants, and easements (collectively, “declaration”). Section 1 of the declaration provided that all provisions of the declaration “shall be deemed to run with the land and shall constitute benefits and burdens to the Declarant, its successors and assigns, and to all parties hereafter having any interest in the Condominium Property.” ¶4. Section 15.6 of the declaration stated that Private terraces, entry terraces and lanais within a Unit or which are Limited Common Elements appurtenant thereto may be used only for recreational purposes and may not be improved except as permitted or required hereby. Such areas may not be used for hanging laundry and may not be enclosed, painted or the color or appearance otherwise altered by the owner except with the prior written consent of the Board of Directors of the Association . . . . Section 15.10 of the declaration, titled “Exterior Improvements[,]” provided that No Unit owner shall cause anything to be applied or attached to, hung, displayed or placed on the exterior walls, terraces, doors or windows of any building (including, but not limited to, awnings, antennae, signs, screens, fixtures and equipment) without the prior written consent of the Board of Directors of the Association. 2 ¶5. Under Section 16.2 of the declaration, If any legal proceeding arises because of an alleged failure of a Unit owner to comply with the terms of the Declarations . . . as they may be amended from time to time, the prevailing party shall be entitled to recover the costs of the proceeding and such reasonable attorney’s fees, costs of litigation, expert witness fees and other costs and expenses as may be awarded by the court. And Section 16.3 of the declaration, referred to as the no-waiver section, stated: No Waiver of Rights. The failure of the Association or any Unit owner to enforce any covenant, restriction or other provision of this Declaration, the Articles of Incorporation and Bylaws of the Association, or the regulations adopted pursuant thereto, shall not constitute a waiver of the right to do so thereafter. ¶6. In 2008, Lyons and McMichael purchased a condo unit located on the seventh floor in Sea Breeze. The condo included a personal terrace. ¶7. On November 5, 2010, Sea Breeze adopted Bylaw Amendment No. 2, which provided: “Pursuant to Section 16 of the Declarations, the Board has the right to impose the following actions upon an owner who violates the Declarations . . . First offense - $100.00 fine[;] Second offense - $300.00 fine[;] Third and subsequent offenses - $600.00 fine.” ¶8. In 2021, Lyons began acquiring from a local artist artwork, referred to as rondels, in the form of colorful, “generally round glass disks of sizes ranging from six inches to about the size of a dinner plate.” Lyons suspended the rondels from his terrace wall using machined aluminum fittings, eventually suspending ten rondels. ¶9. In early 2022, Sea Breeze demanded that condo owners remove objects from terrace walls. The minutes from a June 9, 2022, board meeting reflected that the deadline for 3 compliance with its demand had been June 1, 2022. ¶10. On January 10, 2023, Lyons received an email from the Association stating that he had been in violation of Section 15.10 “for quite some time” and that the board had voted to impose a $100 fine. Lyons, under protest, removed the rondels from his terrace wall and paid the fine. County Court ¶11. On February 7, 2023, Lyons filed in the County Court of Harrison County a complaint against Sea Breeze for permanent injunctive and declaratory relief and for ancillary contract damages. Lyons requested permanent injunctive relief against Sea Breeze to prevent it from enforcing the terms of the declaration and to enjoin Sea Breeze from any fining. ¶12. Lyons argued that Sea Breeze’s failure to enforce Section 15.10 and its allowance of artwork on terrace walls until 2022 resulted in a waiver of Section 16.3, the antiwaiver provision. In the alternative, Lyons asked for the trial court to grant equitable estoppel, contending that he had relied on Sea Breeze’s acquiescence in art on terraces and had changed his position to his detriment by expending substantial funds on artwork based on that reliance.1 Lyons lastly argued that Sea Breeze’s sixteen-year failure to enforce Section 15.10 bars it from asserting any right under the equitable doctrine of laches. ¶13. On March 2, 2023, Sea Breeze answered the complaint, asserting that the issue was one of contract interpretation, an issue of law, and not one of equity. Sea Breeze also asserted 1 Lyons asserted that he had spent approximately $1,400 for the rondels. 4 a counterclaim, requesting that the county court determine that installation of the rondels onto a terrace wall violated the declaration; that Sea Breeze had the ability to require condo owners to comply with the declaration; that Sea Breeze had the ability to enforce a fine; and that no equitable principles applied to permit Lyons to avoid the condo’s contractual obligations. ¶14. On April 12, 2023, Sea Breeze filed a motion for summary judgment, asking the county court to rule as a matter of law on the issue of contract interpretation, to dispose of the issues in Lyons’s complaint, and to award attorneys’ fees and costs. Sea Breeze attached the condo declaration to the motion. It additionally attached a letter dated October 24, 2022, purportedly from a coatings representative from Sherwin-Williams to Sea Breeze regarding “the Loxon wall system coatings” and “the question of whether it was safe to use the hangers that attach to the film of the coating as opposed to wall anchors that puncture the film of the coating and attach directly to the wall.” The representative concluded that “[a]nything mounted on the wall would be considered ‘Owner Damage’ as noted in the warranty exclusions” and that coating failures as a result thereof would not be covered. ¶15. On April 28, 2023, Lyons propounded written discovery requests, including interrogatories, requests for production, and requests for admissions, to Sea Breeze. Sea Breeze submitted its responses to Lyons’s requests for admission, which consisted of admissions and denials. ¶16. On May 15, 2023, Lyons responded to Sea Breeze’s motion for summary judgment 5 and argued that because Lyons had attached the declaration to its complaint, Sea Breeze’s motion was actually a motion for judgment on the pleadings or a motion to dismiss for failure to state a claim under Mississippi Rule of Civil Procedure 12. Lyons claimed that the Sherwin-Williams letter was irrelevant and inappropriate for a motion for summary judgment and asked that the county court disregard the letter. Lyons additionally asserted that fact issues remained and that discovery requests had not been answered; he argued, therefore, that the motion should be denied. ¶17. Sea Breeze next filed a motion for protective order and to stay discovery pending the county court’s ruling on the motion for summary judgment. ¶18. In Sea Breeze’s reply brief in support of its motion for summary judgment, it asserted that governmental entities with statutory obligations cannot waive those obligations or have equitable estoppel enforced against them. Sea Breeze contended that condominium associations were quasi-governmental organizations and had the same responsibilities within the condo premises as does the state to enforce rules and regulations for the protection of owners’ and visitors’ health and safety. ¶19. Lyons filed a combined motion to compel discovery responses and for discovery to be had under Mississippi Rule of Civil Procedure 56(f). Lyons attached his affidavit to the motion and stated that his discovery requests related to his equitable claims. Lyons alleged discovery was needed, among other reasons, to prove his assertions that other condo owners had placed artwork and other items on terrace walls as early as 2008 and that Sea Breeze 6 previously had failed to take action against those owners. Additionally, he alleged that the minutes of a board meeting scheduled for January 5, 2023, were missing from Sea Breeze’s website, as were the minutes from following board meetings. ¶20. Lyons subsequently filed a motion to stay all proceedings until the county court heard the parties’ competing discovery motions. Lyons next filed a motion for partial summary judgment and argued that declaratory judgment should be entered on the contract issues in favor of Lyons and that Sea Breeze should be ordered to return the $100 fine payment. Lyons additionally asked for costs and attorneys’ fees. ¶21. The county court held a motion hearing on August 1, 2023. After hearing arguments from both parties regarding whether Sea Breeze’s motion for summary judgment or the discovery motions should first be heard, it determined that the motion for summary judgment should precede the discovery motions. At the conclusion of the arguments on the motion for summary judgment, the county court ruled from the bench that it was granting summary judgment in favor of Sea Breeze. It found that the declaration was not ambiguous, that the declaration barred the rondels from being hung on the terrace, and that waiver was inapplicable. The county court did not address the parties’ discovery motions. The county court then asked the parties to prepare proposed findings of fact and conclusions of law. ¶22. The county court adopted Sea Breeze’s proposed findings of fact and conclusions of law without modification. Sea Breeze subsequently filed a motion to amend the judgment, stating that the issue of attorneys’ fees had not been addressed and that a final judgment 7 could not therefore be ordered. The county court granted the motion to amend and entered a judgment under Mississippi Rule of Civil Procedure 54(b), granting summary judgment in favor of Sea Breeze; the county court declined to address the issues of attorneys’ fees and costs.2 Chancery Court ¶23. Lyons appealed the county court’s ruling to the Harrison County Chancery Court. In the chancery court, Lyons argued that the county court erred by granting summary judgment without ordering the parties to complete discovery. Additionally, he argued that the county court erred by ruling that the rondels were fixtures and were prohibited under the declaration. ¶24. The chancery court held oral argument and subsequently found that waiver is a question of fact that must be established by the party claiming it and that the county court had foreclosed Lyons’s ability to conduct discovery in support of his claim. Therefore, the chancery court found that the county court had erred by dismissing Lyons’s equity claims as a matter of law and had abused its discretion by not postponing summary judgment for purposes of conducting discovery under Rule 56(f). The chancery court reversed the county court’s judgment without prejudice and held that motions may be renewed once discovery is completed. ¶25. Sea Breeze filed an interlocutory appeal with this Court and argued that the county 2 At the conclusion of the hearing on the motion to amend, the parties agreed to the entry of the Rule 54(b) judgment. 8 court properly held that Sea Breeze is entitled to summary judgment as a matter of law. ANALYSIS I. Whether Sea Breeze is entitled to a judgment as a matter of law. ¶26. “We review the grant [or denial] of summary judgment de novo and will view evidence ‘in the light most favorable to the party against whom the motion has been made.’” Venture, Inc. v. Harris, 307 So. 3d 427, 431 (Miss. 2020) (internal quotation marks omitted) (quoting Renner v. Retzer Res., Inc., 236 So. 3d 810, 814 (Miss. 2017)). “Summary judgment is appropriate when ‘the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue of any material fact and that the moving party is entitled to a judgment as a matter of law.’” Id. at 431-32 (quoting Miss. R. Civ. P. 56(c)). “This Court has continuously held . . . ‘the court cannot try issues of fact on a Rule 56 motion; it may only determine whether there are issues to be tried.’” Id. at 432 (alteration in original) (internal quotation marks omitted) (quoting Evan Johnson & Sons Constr., Inc. v. State, 877 So. 2d 360, 365 (Miss. 2004)). A. Whether, as a matter of law, Sea Breeze can prospectively waive or be estopped from the enforcement of its rules. ¶27. Sea Breeze argues that it is a quasi-governmental entity charged with governing a nonprofit corporation and that the doctrines of waiver and equitable estoppel cannot preclude the enforcement of its declaration. Conversely, Lyons argues that the trial court abused its discretion by granting summary judgment before discovery was conducted. ¶28. Under Mississippi Rule of Civil Procedure 56(f), 9  [s]hould it appear from the affidavits of a party opposing the motion that he cannot for reasons stated present by affidavit facts essential to justify his opposition, the court may refuse the application for judgment or may order a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had or may make such order as is just. Miss. R. Civ. P. 56(f). “The rule protects against improvident or premature grants of summary judgment and is to be applied liberally.” Stanley v. Scott Petroleum Corp., 184 So. 3d 940, 942 (Miss. 2016) (citing Owens v. Thomae, 759 So. 2d 1117, 1121 (Miss. 1999)). “[I]f a summary-judgment motion is filed before discovery is complete, the trial court may postpone ruling on the motion to permit depositions to be taken and other discovery to be had.” Brown v. McKee, 242 So. 3d 121, 127 (Miss. 2018) (internal quotation mark omitted) (quoting Roberts v. Boots Smith Oilfield Servs., LLC, 200 So. 3d 1022, 1026 (Miss. 2016)). ¶29. Lyons asserted in his complaint claims of waiver and equitable estoppel. He claimed that Sea Breeze had waited sixteen years to enforce Section 15.10 and that he had changed his position to his detriment by relying on Sea Breeze’s acquiescence. “Concerning the application of equitable estoppel, ‘[the] issue becomes a question for the trier of fact when there is evidence to support a finding that the plaintiff reasonably relied on the actions of the defendant to his detriment.’” Univ. of Miss. Med. Ctr. v. Aycock, 369 So. 3d 534, 541-42 (Miss. 2023) (alteration in original) (internal quotation marks omitted) (quoting Trosclair v. Miss. Dep’t of Transp., 757 So. 2d 178, 181 (Miss. 2000)). “The determination of whether waiver and equitable estoppel apply to a given situation includes the need to determine issues of fact.” Id. at 542. 10 ¶30. Lyons additionally claimed that Sea Breeze’s sixteen-year silence barred it from asserting any rights under Section 15.10 under the equitable doctrine of laches. The application of laches “is very generally held to depend on the facts and circumstances of each particular case.” Cannada v. Marlar, 185 So. 2d 649, 651 (Miss. 1966). “All attempts to seek application of estoppel and laches require intense factual analysis, and each case must be judged separately.” Elchos v. Haas, 178 So. 3d 1183, 1187 (Miss. 2015) (citing Bright v. Michel, 242 Miss. 738, 137 So. 2d 155, 159 (Miss. 1962); David M. Cox, Inc. v. Pitts, 29 So. 3d 795, 802 (Miss. Ct. App. 2009)). Because the doctrines of estoppel and laches are fact intensive and because the county court granted summary judgment before discovery was completed, the chancery court correctly held that the county court erred by dismissing Lyons’s equity claims as a matter of law and abused its discretion by not postponing summary judgment for purposes of conducting discovery under Rule 56(f). ¶31. The chancery court noted that Sea Breeze had filed its motion for summary judgment before the issuance of discovery and that Lyons had timely propounded discovery shortly thereafter. “Rule 56(f) ‘contemplates that completion of discovery in some instances is desirable and necessary before a court can determine that there are genuine issues as to the material facts.’” Roberts, 200 So. 3d at 1026 (quoting Smith v. H.C. Bailey Cos., 477 So. 2d 224, 232 (Miss. 1985)). “This is especially true where the party seeking to invoke the protections of Rule 56(f) claims the necessary information rests within the possession of the party seeking summary judgment.” Id. (internal quotation marks omitted) (quoting Prescott 11 v. Leaf River Forest Prods., Inc., 740 So. 2d 301, 308 (Miss. 1999)). A denial of a Rule 56(f) motion is reviewed for abuse of discretion. Howarth v. M&H Ventures, LLC, 237 So. 3d 107, 113 (Miss. 2017) (quoting Stanley, 184 So. 3d at 942). ¶32. Although Lyons did not raise Rule 56(f) in his response to Sea Breeze’s motion for summary judgment, he filed a motion to compel discovery responses and a Rule 56(f) motion in response to Sea Breeze’s motion for protective order and stay of discovery. Lyons also attached his supporting affidavit to his motion Rule 56(f) motion. He stated that based on his personal knowledge, other Sea Breeze owners had placed items on terrace walls between 2006 and 2021. Lyons lacked, however, memory of specifics, such as who placed the items on terrace walls, how many appeared, and the time span involved. Lyons argued that questions remained regarding what Sea Breeze knew about those items, when the items were placed, and what Sea Breeze did in response to the placement of the items. Further, Lyons claimed that the minutes of the board’s January 5, 2023, meeting were absent from Sea Breeze’s website, as well as minutes reflecting the board’s decision to sanction Lyons for the artwork previously on his terrace wall. Lyons also claimed that the matters were within Sea Breeze’s custody or control. ¶33. Therefore, Lyons “demonstrate[d] ‘how postponement of a ruling on the motion will enable him, by discovery or other means, to rebut the movant’s showing of the absence of a genuine issue of fact.’” Howarth, 237 So. 3d at 113 (quoting Stanley, 184 So. 3d at 942). Accordingly, because the doctrines of laches and estoppel are fact intensive and because 12 “[t]he burden of establishing the elements of an estoppel is on the party asserting the estoppel[,]” the chancery court correctly held that the county court foreclosed Lyons’s ability to conduct discovery in support of his claim. Rawls Springs Util. Dist. v. Novak, 765 So. 2d 1288, 1292 (Miss. 2000) (quoting Chapman v. Chapman, 473 So. 2d 467, 470 (Miss. 1985)). We find that the county court erred by granting summary judgment before the completion of discovery and that this case should be remanded. ¶34. While Sea Breeze argues that its contract contained an antiwaiver provision, “[i]t is simple contract law that a party may waive the protections of any provision of a contract.” Watkins Dev., LLC v. Jackson Redev. Auth., 283 So. 3d 170, 176 (Miss. 2019) (internal quotation marks omitted) (quoting Sanderson Farms, Inc. v. Gatlin, 848 So. 2d 828, 837 (Miss. 2003)). There, a lease had “contained an anti-waiver clause, and [the defendant] argue[d] that clause should preclude a finding of waiver, citing Kirkland v. Chinita Land Dev., Inc., 798 So. 2d 620, 623-24 (Miss. Ct. App. 2001).” Watkins Dev., LLC, 283 So. 3d at 177. Yet this Court stated that “the Court of Appeals cited no authority, and its decision appears to contradict, without explanation, the majority view that non-waiver provisions can themselves be waived, like any other provision of a contract.” Id. ¶35. Moreover, this Court has not previously addressed whether a condo association is a quasi-governmental body. Sea Breeze asserts that the county court properly granted summary judgment because Lyons’s equitable claims could be decided irrespective of additional evidence produced in discovery. Sea Breeze’s arguments focus on the premise that “[t]he 13 state’s trust duty is a mandatory obligation that cannot be waived.” N. Bolivar Consol. Sch. Dist. v. Jones, 359 So. 3d 183, 190 (Miss. 2023) (citing Oak Grove Marketplace, LLC v. Lamar Cnty. Sch. Dist., 287 So. 3d 924, 940 (Miss. 2020)). The state also cannot “surrender its police power in the administration of government and in the preservation of peace and order.” Id. (internal quotation marks omitted) (quoting Oak Grove Marketplace, LLC, 287 So. 3d at 930). Further, “[t]he continuing duty of the trustee is enforceable at any time, and may not be avoided because of past defaults.” Id. (internal quotation marks omitted) (quoting Hill v. Thompson, 564 So. 2d 1, 7 (Miss. 1989)). ¶36. Sea Breeze further cites nonprecedential case law from other jurisdictions to support its argument. The Colorado Court of Appeals has recognized that “[a] homeowners’ association has a fiduciary duty to homeowners to enforce restrictive covenants.” Woodward v. Bd. of Dirs. of Tamarron Ass’n of Condo. Owners, Inc., 155 P.3d 621, 624 (Colo. App. 2007). “This duty has been imposed in recognition of the power held by homeowner[s’] associations, the quasi-governmental functions they serve, and the impact on value and enjoyment that can result from the failure to enforce covenants.” Id. (alteration in original) (internal quotation marks omitted) (quoting Colo. Homes, Ltd. v. Loerch-Wilson, 43 P.3d 718, 722 (Colo. App. 2001)). ¶37. Likewise, a California appellate court has stated that “the powers of such associations are extensive.” Cohen v. Kite Hill Comm. Assn., 142 Cal App. 3d 642, 651 (Cal. Ct. App. 1983). It discussed that 14  “By his acceptance, the purchaser automatically becomes a member of the association created by the declaration and submits to the authority of the association and to the restrictions upon the use and enjoyment of the property contained in the declaration. Because each owner automatically becomes a member of the association upon taking title and because the association is empowered to levy and collect assessments, to make and to enforce rules, and to permit or to deny certain uses of the property, the association has the power, and in many cases the obligation, to exert tremendous influence on the bundle of rights normally enjoyed as a concomitant part of fee simple ownership of property.” Id. (quoting Wayne S. Hyatt & James B. Rhoads, Concepts of Liability in the Development and Administration of Condominium and Home Owners Associations, 12 Wake Forest L. Rev. 915, 917 (1976)). This Court, however, has not adopted those propositions. We agree with the chancery court that “[w]hile these ultimately may be valid legal arguments, they should be borne out after all of the evidence is before the trial court.” Because the record did not contain all facts necessary for a final adjudication, we affirm the judgment of the chancery court to reverse the county court’s ruling without prejudice. Therefore, we remand the case to the county court for further proceedings consistent with this opinion. B. Whether the issue of Sea Breeze’s quasi-governmental status was pleaded or, alternatively, was tried by consent. ¶38. Lyons next argues that Sea Breeze failed to plead the issue of whether its alleged status as a quasi-governmental entity constituted a prohibition on equitable principles; therefore, he contends that the issue is procedurally barred. Although Lyons raised this argument in his discovery motions, the county court granted summary judgment without addressing the discovery motions. In its order granting summary judgment, the county court 15 did not reference Sea Breeze’s quasi-governmental status and did not address whether that issue had been appropriately pleaded. The chancery court also did not address this issue. Because the county court and chancery court did not address this issue, we decline to address the issue on appeal. The pertinent arguments may be raised in the county court on remand. CONCLUSION ¶39. Because the chancery court correctly found that the county court had abused its discretion by granting summary judgment before discovery was completed, we affirm the decision of the chancery court and remand this case to the county court for further proceedings consistent with this opinion. ¶40. AFFIRMED AND REMANDED. RANDOLPH, C.J., COLEMAN, P.J., ISHEE, GRIFFIS, SULLIVAN, BRANNING, WILSON AND TOLLISON, JJ., CONCUR. 16