FIRST DOCUMENT ORGANIZING THE COMMUNITY AND PROMOTING THE ESTABLISHMENT OF A SILVER SPRINGS MASTER ASSOCIATION
THOUGH ITS PURPOSE TO SET UP A MASTER ASSOCIATION WAS NEVER COMPLETED

DEVELOPER-HOMEOWNER AGREEMENT
SILVER SPRINGS SUBDIVISION (COMMUNITIES)

October 3, 1989; Recorded October 25, 1989
Recorded January 5, 1990 as Entry 318770 Book 550 pp 111-130

AGREEMENT entered into by and between SILVER SPRINGS ASSOCIATES, a California general partnership (hereinafter “Developer”), and SILVER SPRINGS HOMEOWNERS ASSOCIATION, SILVER SPRINGS TOWNHOUSE CONDOMINIUM HOMEOWNERS ASSOCIATION (SILVER MEADOWS PHASE), WILLOW BEND WEST HOMEOWNERS ASSOCIATION, MEADOW SPRINGS HOMEOWNERS ASSOCIATION, MEADOW WILD HOMEOWNERS ASSOCIATION, and SILVER SPRINGS TOWNHOUSE HOMEOWNERS ASSOCIATION (WILLOW BEND EAST), (hereinafter “Homeowners”).

RECITALS

WHEREAS, Developer has recently purchased and acquired from American Savings and Loan Association all of the real property formerly held by said institution within the Silver Springs Subdivision (hereinafter “Subdivision”), located at Snyderville, Utah, which property holding includes a majority of the undeveloped parcels in the Subdivision, along with certain additional parcels which the Summit County Master Plan for the Subdivision (hereinafter “Master Plan”) indicates as being for use as open, common and/or recreational areas;

AND WHEREAS, provisions contained within at least one of the respective declarations of covenants, conditions, and restrictions for the individual homeowner associations require that common areas (undesignated) within the Subdivision shall be transferred by the original declarant, its successors or assigns, to the respective homeowner association upon designation of a property or properties as common area;

AND WHEREAS, it was intended by the original developer of the Subdivision and was provided certain of the initial master planning documents that a master homeowners association would be formed for the purpose of representing all property owners withing the Subdivision with respect to maintenance, improvement, and administration of Subdivision common areas;

AND WHEREAS, although neither the official Summit County Master Plan nor the respective declarations clearly identify which areas within the Subdivision are to be designated and used as common areas for the Homeowners, the Summit County Planning Commission has resolved that one of the subject parcels hereinafter described should be set aside for the recreational use of the Homeowners, but has not clarified which additional common area, if any, is also to be provided for the Homeowners’ use;

AND WHEREAS, the foregoing pronouncements and the history of the issues concerning common areas in the Subdivision has resulted in ambiguity and in uncertainty as to the amount, location and administration of those areas;

AND WHEREAS, the parties hereto desire to resolve the uncertainty as to the amount, quality and designation of common area within the Subdivision, with the intent and purpose of:establishing a harmonious relationship between the parties, such that the Developer’s various projects may proceed in a manner beneficial to the Homeowners interests; provided those recreational amenities and uses to which the Homeowners are entitled; and resolving potential claims which the Homeowners may have against Developer and Developers’ predecessors in
interest:

NOW, THEREFORE. IN CONSIDERATION OF the performance of the mutual covenants, conditions and promises hereinafter set forth, it is agreed as follows:

1. Conveyance of Park Parcel. Developer shall execute a Special Warranty Deed conveying that certain common area parcel, hereinafter described and known as the “Park Parcel”, to each of the homeowner associations named herein, as grantees. Said deed shall be placed in escrow with Coalition Title (the “Escrow Agent”), a title company located at Park City, Utah, with escrow to commence and eventual delivery of deed to the Park Parcel to occur as follows:

(a) Developer shall deposit the Park Parcel deed into escrow immediately at such time as the governing boards of at least two-thirds of the duly constituted associations representing property owners in the Subdivision have executed this Agreement in accordance with the regulations of each respective organization.

(b) The deed shall be held in escrow for a period no longer than sixty (60) days. If, at the expiration of 60 days, a master homeowners association for the Subdivision, organized to represent all of the Homeowners and for the purpose of administering, maintaining and improving the subject common areas, has been duly organized and incorporated, the deed initially placed in escrow shall be withdrawn and a deed naming such master homeowners association as grantee shall be delivered by Developer to Escrow Agent for recording.

IF, however, at the expiration of sixty (60) days, such master homeowners association has not been duly formed and empowered to act in these regards, for any reason whatsoever, (including without limitation, the refusal of any association(s) to join such master association), then the initial Park Parcel deed placed into escrow (naming all associations as grantees) shall immediately thereafter be released from escrow and recorded by escrow agent.

(c) Developer shall convey the Park Parcel free and clear of any and all financial encumbrances. Taxes and assessments in connection with the property shall be paid current by Developer at time of conveyance.

(d) Conveyance of the Park Parcel shall be accompanied by a good and sufficient policy of title insurance, with no exceptions listed other than the usual and standard title policy exceptions. The cost of said title insurance shall be borne one-half by Developer and one-half by the Homeowners.

(e) The Park Parcel is an area of approximately 2.1 acres (SOS-A-Park), located along the southeast shore of the large pond within the Subdivision, and is more particularly described as follows:

See Exhibit “A”

2. Conveyance of Tennis Court Parcel. Developer shall execute a Special Warranty Deed conveying that certain common area parcel, hereinafter described and known as the “Tennis Court Parcel” to each of the homeowner associations named herein, as grantees. The terms and conditions of escrow, including commencement thereof and eventual delivery of deed, shall be identical to the provisions set forth in paragraph 1 concerning conveyance of the Park Parcel.

The Tennis Court Parcel is an area of approximately 0.6 acre (PP-91) and includes one of two tennis courts installed thereon, along with a small open area immediately adjacent thereon. (The exact dimensions are unknown; survey needed to confirm exact acreage.) The other tennis court at the site is not owned by the Developer, who is under no obligation to acquire the same for the benefit of the Homeowners;, however, if acquired by Developer, the other tennis court will be conveyed to the Homeowners. The Tennis Court Parcel is located in the southeastern portion of the Subdivision, and is more particularly described as follows:

See Exhibit B”

3. Southern Berm Parcel. By not later than November 1, 1990, Developer shall execute and deliver a Special Warranty Deed conveying that certain common area parcel, hereinafter described and know as the “Southern Berm Parcel”, to either: (i) the Subdivision master homeowners association as grantee or, (ii) if said association has not been formed, to all of the homeowner associations named herein, as grantees. Developer is to retain title to and control of said parcel until such time solely for the purpose set forth immediately below, and if such purpose, which is wholly voluntary on the part of Developer, is determined not to be undertaken by Developer or is completed prior to November 1, 1990, Developer shall forthwith convey the Southern Berm as provided above.

Developer may, but shall be under no obligation to, add additional earthen material to that portion of the Southern Berm Parcel which is contiguous to State Highway 224, in order to increase the height of the existing berm along said highway as a noise prevention and privacy amenity, and to make said berm uniform in height with existing berm areas along the western boundary of the Subdivision. Although Developer is not obligated to provide such additional material to the berm, in the event that Developer determines to do so, Developer shall complete such work by November 1, 1990. If such work is undertaken, Developer shall be obligated to provide a uniform height and contour to the berm, utilizing such fill material and providing such vegetation cover as is substantially similar to that which is present at the adjacent berm area; but shall have no obligation to provide topsoil, landscaping or any other facility or amenity thereto, including water delivery or security device, except as described herein. The expense of all labor and material for such work shall be paid by Developer.

Developer represents and agrees that that certain 15-foot access easement which is located approximately between thos lots which are presently designed as Lots 183 and 184 in Parcel 1F [formerly Silver Springs Phase 1-D] of the Master Plan, which provides an access point to the Southern Berm Parcel from the interior road within the Subdivision known as Silver Springs Road, shall be preserved for the access, use and benefit of the Homeowners.

The Southern Berm Parcel is an area of approximately 6.8 acres, located along the western boundary of the Subdivision and is adjacent to State Highway 224. The southern end of this parcel commences in the vicinity of the main[south] entrance and access road to the Subdivision, and continues, in varying width, along State Highway 224 in a northerly direction, ending near the northwestern portion of the large pond at the northern access road to the Subdivision, and is more particularly described as follows:

See Exhibit “C”

4. Master Homeowners Association. Developer will coordinate meeting(s) and notification to associations to initiate the organization of a master homeowners association. Developer, at its expense, shall provide documents suitable for establishing an organizational format for an association representing all Homeowners with respect to the maintenance, improvement and administration of the common areas within the Subdivision.. Developer’s obligation in this regard shall be limited, however, to providing organizational documents in general draft form only, with specific details as to the nature and extent of improvements; cost thereof, procedure for levying common expense assessments, and method for the enforcement of such assessment authority, among other things, being the obligation of the individual associations acting as a group to provide, and not that of the Developer.

Each homeowner association which submits itself to the authority of the Master Association shall be entitled one (1) vote, and not more nor less, in connection with any determination, resolution, ballot or other matter put to vote under the governing charter and or bylaws of the Master Association.

5. Common Area Costs. The expenses for improvement and maintenance of the common areas (as described in the attached exhibits), including taxes, assessments and insurance, shall be distributed among all members of the master association as follows:

(a) Each developed lot, single-family residence, and condominium or townhouse unit will be an assessable property, one share each, for purposes of allocating common area expenses associated with the common area properties. By way of illustration only, if the development and/or maintenance costs for the subject common areas, at any given point, are in the amount of $50,000.00 and there are collectively 400 lots, single-family residences, townhouses and condominiums, the per unit assessment would be $125.00; by appropriate vote of the master homeowners association members, this assessment could be payable on a prorated basis over a period of time. Any of the lots proposed for development in Parcel 1-G [NorthShore] of Developer’s project shall be considered a “developed” lot, and thus liable for assessments, upon recordation of the plat for that particular phase of development, it being contemplated that Parcel 1-G will be developed in stages. Provided, however, that the liability of the Developer and/or owner(s) of any lot in any phase of Parcel 1-G development shall not accrue, nor shall payment of common area costs be required, until all developed units which are under the governing authority of the master association and which are assessable under provisions of this paragraph 5(a) are liable for payment of such costs.

(b) Those undeveloped properties acquired by Developer which are identified in the Master Plan as Parcels 1-D [west row of SouthShore lots], 1-F [SouthShore], and the multi-family parcels surrounding the upper pond [Little Lake] (collectively known as the “Interior Parcel”) will not be assessable for costs of common area development as provided in paragraph 5(a) above until such time as Developer proceeds with the development and marketing of the lots and condominium units contained within the Interior Parcel. When each of such development areas are platted, and marketing then commences, each lot, pad or condominium unit therein shall be assessed the exact and total dollar figure which all other lots, pads or condominium units have previously been assessed in accordance with the formula provided in paragraph 5(a) above. Actual payment for such assessment shall be due upon the closing of the sale of each such lot. It is understood that this “pay-as-you-go” basis for assessment is to bind the Developer’s successors in interest, including lot purchasers, and shall have the same force and effect as a covenant running with the land. Therefore, but not by way of limitation, this Agreement may be recorded in the office of the Summit County Recorder in order to preserve the liability of subsequent owners of property within the Interior Parcel for the payment of common area assessments.

See Exhibit “D”

6. Architectural Guidelines. In conjunction with the recordation of a Declaration of Covenants, Conditions and Restrictions for Parcel 1-G, Developer shall promulgate architectural guidelines for the purpose of regulating residential design and facilities within Parcel 1-G . Those architectural guidelines for Parcel 1-G shall be substantially in accord with the architectural guidelines now in effect for the existing single-family homes in the Subdivision, the purpose and intent being to preserve a reasonable conformity of architectural style and design, as well as property use, within the single-family parcels of the Subdivision. Further, it is agreed that the Declaration for Parcel 1-G shall preserve and continue that degree of control, restriction as to lot size, property use and activity, as well as the statement of purpose and intent which is to be found within the existing Declaration for the Silver Springs Homeowners Association.

7. Release of Claims. The Homeowners release Developer, and agree that they will, in a separate instrument, release American Savings and Loan Association as former owner of the subject parcels, and each and every person or entity who was at any time prior to the execution hereof an officer, owner, director, shareholder, employee, trustee or beneficiary of Developer or American Savings and Loan Association, from any and all liabilities, claims, counterclaims, expenses and demands of any nature and kind, whether now known or unknown, arising out of, relating to or in any way connected with, said parties’ obligation to provide, or liability for failure to provide, common park, recreational and/or open space within the Subdivision, whether designated by the Master Plan or the resolution(s) of the Summit County Planning Commission, or any private agreement between said parties and any Subdivision homeowner association, including, but not limited to, access points and requested access points to any pond or water course within the Subdivision.
This release is mutual and reciprocal, and therefore, Developer releases the Homeowners, their respective associations, governing boards, officers, trustees, beneficiaries and agents from any and all claims concerning subject matter of this paragraph 7 to the same extent as Homeowners have agreed above to release Developer and American Savings and Loan Association.
It is further understood and agreed, in view of the executory nature of Developer’s obligations under this Agreement, that a failure or breach by Developer in the performance of any of the terms, conditions or covenants hereof shall nullify any release by the Homeowners of Developer and American Savings and Loan Association, enabling the Homeowners or anyone of them, to enforce any right, claim, expense or demand which may have existed prior to the execution of this Agreement.

8. Purpose, Intent and Admissibility. It is understood that some of the minor details of this Agreement may require further clarification in order to accomplish the purpose and intent of the parties. However, the parties agree that the specific parcels mentioned herein to be conveyed to the associations or master association, including the time frame for accomplishment thereof, as well as the general principles for payment of common area costs and the compatibility between architectural guidelines and Subdivision declarations, shall constitute the general and binding agreement of the parties as to the issues set forth herein. Excepting such minor details as the parties may agree are necessary to accomplish the purpose and intent hereof, this Agreement shall be considered binding upon the parties, who hereby waive any objection to this Agreement under Rule 408 of the Utah Rules of Evidence, agreeing that if litigation should ensue concerning the subject hereof, or that if request is made of any local governmental agency to review the issue of common areas within the Subdivision, that this Agreement is admissible into evidence in any such proceeding in order to prove and establish the parties’ purpose, intent and agreement.

9. Majority Approval. It is understood that this Agreement is subject to approval of and/or modification by a two-thirds (2/3) majority of the duly constituted homeowner associations representing property owners within the Subdivision. Upon the execution hereof by such majority, this Agreement shall have full force and binding effect upon all signatories hereto, and the failure of any association or associations constituting a (1/3) minority of those identified as “Homeowners” herein shall not abrogate any of the rights and duties of the parties who are signatories hereto.

10. Miscellaneous.

(a) The parties agree that, should any of them default in any of the covenants or agreements herein contained, the defaulting party shall pay all costs and expenses, including a reasonable attorney’s fee, which may arise or accrue from enforcing this Agreement or in pursuing any remedy provided herein or by applicable law, whether such remedy is pursued by filing suit or by submission to the appropriate local governmental agency, and whether a judicial or agency determination that s party is in breach or default is made or not made.

(b) This agreement, along with any exhibits hereto, constitutes the entire understanding of the parties with respect to the subject matter hereof, and may be amended only by written instrument executed by all of the parties or their respective successors and assigns. All prior oral or written discussions or agreements of any kind are hereby superseded, and there are no restrictions, promises, warranties, covenants or undertakings other than those expressly set forth herein.

(c) This Agreement shall be binding, without limitation, upon the parties’ successors in interest, assigns, purchasers, heirs, partners, joint venturers, personal representatives, trustees, agents and specifically, such lenders or lending financial institutions which have a security interest in any of the parcels in the Subdivision to be developed by Developer or in the common areas, if such lender forecloses or otherwise enforces a security interest and takes title to and/or possession of such secured property.

(d) Exact duplicates of this Agreement may be executed separately by the parties and, if so, such duly executed duplicates shall constitute an integrated Agreement, with full and binding effect upon all of the parties, as if their original signatures appeared together on one copy of this Agreement.

(e) The parties each acknowledge that this Agreement was executed with full authority of its respective governing body and in accordance with its respective governing rules and regulations, and that each party has knowingly, voluntarily and intelligently entered into this Agreement.

(f) The parties acknowledge that the purposes and objectives to be accomplished under this Agreement are a cooperative endeavor, and that it is in the interests of all the parties to provide notice to the others of any material breach, default or non-compliance with the provisions hereof, as well as of any contemplated legal or administrative action toward the enforcement hereof, which notification shall be in writing and shall provide for at least ten (10) days in which to cure or remedy any alleged breach or default prior to action for the enforcement of this Agreement. Such notification shall be given upon deposit in the U.S. mail, postage prepaid, addressed as follows:
Developer:
Silver Springs Associates
MIchael Barnes, General Partner
Warren Spieker, Jr. General Partner
Spieker Silver Springs Partners
Richard Widdows, General Partner
P.O. Box 1980
Park City, Utah 84060-1980

With a copy to:
David W. Johnson, Esq.
WOODBURY, BETTYLYON, JENSEN, KESLER & SWINTON
2677 Parley’s Way
Salt Lake City, Utah 84109

Homeowners:
President, Silver Springs Homeowners Association
P.O. Box 3323
Park City, Utah 84060-3323

With a copy to:
Scott C. Welling
312 Main Street
P.O. Box 712
Park City, Utah 84060-0712

1) President, Silver Springs Townhouse Condominium (Silver Meadows Phase) Homeowners Association: Heinz K. Somek

2) President, Willow Bend West Homeowners Association: Lynn Stevens
Vice President, Willow Bend West Homeowners Association: Larry Eichner

3) President, Meadow Springs Homeowners Association: R. Michael McComb

4) President, Quail Meadows I Homeowners Association:  Sandy Shelock
Vice President, Quail Meadows I Homeowners Association: John C. Wilkinson

5) President, Silver Springs Townhouse (Willow Bend East) Homeowners Association: Barbara “Bobby” Schwendiman

6) President, Silver Springs Single Family Homeowners Association: Robert V. Haedt

7) President, Meadow Wild Condominiums: Jay L. Sittig

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In 1990, Lynn Stevens, who was then president of the Willowbend West HOA, as well as manager of the Silver Springs Water Co, acting in concert with the Developers, created a draft of the MA Bylaws as they were obligated to do. However, the constituent HOAs never provided input nor ultimately ratified the draft. This has been confirmed by the Developer, the assisting attorney, and Silver Springs Members involved at that time in the process. That explains why MA Bylaws Article XIII Adoption is incomplete.  No meeting of the Board of Trustees was held and no vote of adoption was ever taken. [Again, confirmed by conversations with the Developer and the assisting attorney.]  Aside from the difficulty of getting each HOA to provide specific language or organizational changes, the last step proves to be problematic due to there never occurring a vesting of the authority of each HOA trustee to bind its HOA to the MA.

The trustees never prepared the specific details required to complete final MA Bylaws. Therefore the trustees never voted to adopt, nor ever signed any MA Bylaws, therefore they never submitted themselves to the authority of the MA…under the governing charter and/or Bylaws of the Master Association. The Silver Springs Community individual subdivision presidents are there meeting only as a group with the title “Master Association” without any of the legal documentation for an actual Master HOA.  The existing Minutes of these meetings substantiate that this group have not followed any set of rules or regulations by which they might administer the affairs of the Silver Springs Community nor do they have the power or vested authority to assess the property owners, etc.  This, therefore, supports the resignation of individual subdivision HOAs from the group with merely a title of “Master Association.” (1989 Developer-Homeowner Agreement, Section 4, last paragraph.)