Pratik Pandharipande, M.D. v. FSD Corporation (Enforceability of Restrictive Covenants by HOA)

Style: Pratik Pandharipande, M.D. v. FSD Corporation

TSC Docket Number: M2020-01174-SC-R11-CV

Date of TSC Opinion:  October 16, 2023

Opinion of the TSC:   Click here.

TSC Summary of the Opinion:  

This case arises from a dispute between a property owner and his homeowners’ association. The property owner, Pratik Pandharipande, purchased a home in a vacation community on a Tennessee lake, intending to use it as a short-term rental. At the time of the purchase, the property was subject to covenants requiring that the home be used for “residential and no other purposes.” The covenants were amended several years later to allow leases with minimum lease terms of thirty days. Pandharipande contends that neither the original covenants nor the amendments prohibit him from leasing his property for short terms of two to twenty-eight days. His homeowners’ association disagrees on both scores. We agree with Pandharipande that the original covenants requiring residential use of the property do not bar his short-term rentals, but we agree with the homeowners’ association that the amendments do. The trial court granted summary judgment in favor of the homeowners’ association based on both the original covenants and the amendments. The Court of Appeals affirmed. We affirm the Court of Appeals in part, reverse in part, and remand for further proceedings consistent with this opinion.

Court of Appeals Opinion: https://www.tncourts.gov/sites/default/files/pratik.pandharipande.opn_.pdf

Summary by the Court of Appeals:

This is a dispute between a property owner and his homeowners’ association concerning the scope and applicability of restrictive covenants. Two restrictive covenants are at issue. One is a covenant contained in the neighborhood’s 1984 Declaration of Covenants, Conditions, and Restrictions that limited usage of the homes to residential use as “a residence by a single family.” The other is a covenant contained in a 2018 Amendment that relaxed the 1984 residential use restriction by authorizing short-term rentals of no less than 30 consecutive days, subject to specific criteria. The plaintiff, who purchased a home in the development in 2015 and has been leasing it on a short-term vacation rental basis to third parties as a business venture, seeks a declaratory judgment that he may lease his home for rentals as short as two days. For its part, the homeowners’ association seeks to enforce the restrictive covenants in the 1984 Declaration as well as the 2018 Amendment. The trial court granted summary judgment in favor of the homeowners’ association on both issues. In doing so, the court held that restrictions in the 1984 Declaration prohibited nonresidential renting. The court also held that Plaintiff’s current use of his property is subject to the 2018 Amendment, which authorized short-term leasing subject to stipulations including that “[t]the length of the lease must be for a minimum of 30 consecutive days.” The plaintiff appeals. We affirm.

Permission to Appeal Granted: October 21, 2022

Appellants’ Briefs Filed: December 21, 2022

Appellees’ Briefs Filed: January 20, 2023

Appellants’ Reply Brief Filed: February 14, 2023

Appellees’ Reply Brief Filed:

Amicus Briefs Permitted:  

Oral Argument Date: February 22, 2023

Link to Oral Argument Video: https://www.youtube.com/watch?v=GzuZc25wRU4