By
Saul J. Feldman
The SJC in Queler, 438 Mass 304 (2002), concluded that
the declarant of a phased condominium development may reserve in the master
deed an interest in property that is submitted to the
The SJC
recognized that under common law a property owner has the right to impose
limitations or conditions on an estate that is conveyed to another, such that
the conveyance is not one of fee simple absolute. The SJC further concluded
that the declarant’s retention of a defeasible fee is not inconsistent with Chapter
183A.
Referring to a
1986 decision, Tosney v. Chelmsford
Village Condominium Association, the SJC stated that those matters that
are not specifically addressed in the statute are to be worked out by the
involved parties.
Once Phase 1 is
completed, the subsequent phases can be added to the condominium without
any structures on these phases. This is based on several cases, in the Tosney case the court ruled that Chapter
183A is an enabling statute; what is not specifically prohibited is allowed. In
the Queler case, the analysis is
based on a fee simple interest, with a reversion which would allow the
subsequent phases to consist of just land without any structure. There
is not any need for a construction trailer or any structure on the subsequent
phases. This would not be a land-only condominium, because Phase 1 would have
one or more buildings on it.
An example would
be the Blackrock Condominium, a mixed-use condominium for which I drafted the
condominium documents. Phase 1 is the golf course and the remaining land is the
residential component. As Phase 1, the golf course and its clubhouse are
already in the condominium, when the time comes to start bringing in the
residential phases, this is clearly not a land-only condominium because Phase
1, the golf unit, already has a building.
Finally, my take
on Queler is perhaps best expressed
in the earlier 1995 case of Podell v.
Zahn. The court in Podell stated that phasing grew out of
the general enabling provisions of Chapter 183A and that phasing permits a
developer to expand the project in response to market conditions. A bank would
not be willing to lend $5,000,000 up front but would be willing to lend $1,000,000
upfront and the remaining $4,000,000 in tranches, as long as the market
justifies the additional phases. For example, each tranche could be for $1,000,000.
See Massachusetts Condominium Law
(MCLE, Inc. 3rd ed. 2015 & Supp. 2017). The SJC in Podell noted that successive phases are
added by successive phasing amendments to the master deed.
Queler
is important for the following reasons:
1)
If the declarant wants to remove land,
the master deed should expressly state that the declarant submits a fee-simple
determinable, not a fee-simple absolute, and the removal procedure should rely
on the common law defeasible fee.
2)
The case of Levy
v. Reardon was expressly overruled by Queler. Most practitioners believed that the Levy case was a mistake and found comfort in the fact that Queler overruled Levy.
3)
In Queler,
the SJC returns to its flexibility posture, allowing problems to be sorted
out by conveyancing attorneys.
There have been
periods of time when I believed that Chapter 183A should be replaced by a
second-generation statute modelled after the Uniform Condominium Act or a
third-generation statute modelled after the Uniform Common Interest Ownership Act.
There have also periods of time when I believed it would be best to leave
things the way they are, given the large body of case law which now interprets
Chapter 183A. The case law along with Chapter 183A works very well.
As I move into
the retirement phase of my life, I still have not made up my mind. If I wake up
in the middle of the night with the answer, I will write another article to share
my conclusion with you!
A
longtime member of REBA, Saul Feldman recently retired after practicing law for
almost 50 years. REBA News wishes him a
long, healthy and content retirement. Saul can be contacted by email at saul@feldmanrelaw.com.
