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Community Services Associates, Inc. v. Wall

Court of Appeals of South Carolina

December 6, 2017

Community Services Associates, Inc., Appellant,
Stephen H. Wall and Maria P. Snyder Wall, Respondents.

          Heard October 10, 2017

         Appeal From Beaufort County Marvin H. Dukes, III, Master-in-Equity

          F. Ward Borden, of Jones Simpson & Newton, PA, of Bluffton, for Appellant.

          Drew A. Laughlin, of Laughlin & Bowen, PC, of Hilton Head Island, for Respondents.


          GEATHERS, J.

         Appellant Community Services Associates, Inc. (CSA) seeks review of an order of the Master-in-Equity denying CSA's request to permanently enjoin Respondents, Stephen H. Wall and Maria P. Snyder Wall (collectively, the Walls), from renting out the first floor of their single-family residence while simultaneously occupying the upstairs guest suite. CSA argues the master erred by (1) finding the Walls' residence had only one kitchen; (2) concluding the Walls' rental activity did not violate CSA's restrictive covenants; and (3) declining to consider a letter written by Respondent Maria P. Snyder Wall (Mrs. Wall) and published in a local newspaper after the merits hearing. We affirm.


         On April 1, 1970, the Sea Pines Plantation Company adopted the current restrictive covenants that apply to residential and common areas within Sea Pines Plantation, a gated community on Hilton Head Island (the Covenants). Part I of the Covenants applies to all "Class 'A' Residential Areas" and includes, inter alia, the following restrictions:

5. All lots in said Residential Areas shall be used for residential purposes exclusively. No structure, except as hereinafter provided[, ] shall be erected, altered, placed or permitted to remain on any lot other than one (1) detached single family dwelling not to exceed two (2) stories in height and one small one-story accessory building [that] may include a detached private garage and/or servant's quarters, provided the use of such dwelling or accessory building does not overcrowd the site and provided further[] that such building is not used for any activity normally conducted as a business. Such accessory building may not be constructed prior to the construction of the main building.
6. A guest suite or like facility without a kitchen may be included as part of the main dwelling or accessory building, but such suite may not be rented or leased except as part of the entire premises[, ] including the main dwelling, and provided, however, that such guest suite would not result in over-crowding the site.

         (emphasis added). Parts II through V, respectively, apply to only those areas designated as "Beach Residential, " "Golf Fairway Residential, " etc. The Sea Pines Plantation Company enforced the Covenants until CSA, a property owners' association, succeeded to the Covenants' enforcement.

         In 1998, the Walls purchased their residence at 48 Planters Wood Drive in Sea Pines Plantation. According to Respondent Stephen H. Wall (Mr. Wall), the residence has one kitchen on the north side of the first floor. The second story of the residence consists of a guest suite that is accessible only by an outside staircase.

         In 20 12, the W alls b e gan renting out a room in their residence through Airbnb, an online rental broker. The Walls' listing with Airbnb was titled "Hilton Head Organic B&B, Sea Pines" and indicated that the room accommodated three individuals. The Walls also cooked breakfast for their renters. After CSA expressed concern about the Walls' rental activity, the Walls changed their listing with Airbnb to the "Whole House" category and began renting out the entire first floor while living in the second-story guest suite themselves. They also dropped the title "Hilton Head Organic B&B, Sea Pines" and stopped cooking breakfast for their renters.

         On September 25, 2014, CSA filed a Verified Complaint against the Walls, seeking temporary and permanent injunctions against the Walls' alleged operation of "a bed and breakfast" in their residence and the rental of merely part of the residence rather than the entire residence. In its complaint, CSA asserted that the Covenants, specifically paragraphs five and six of Part I, authorize the short-term rental of an entire residence but not part of a residence.

         The Walls filed a Verified Answer asserting they advertised on in the "Whole House" category and that they remained in the guest suite when their whole house was rented. However, the Walls denied CSA's allegation that they were operating a bed and breakfast in their residence. The master conducted a hearing on CSA's temporary injunction request on April 7, 2015, which was continued to April 21, 2015. On ...

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