OCEAN PINES — The Mid-Delmarva YMCA did satisfy the terms of a contract with the Ocean Pines Association (OPA) when it obtained a building permit to construct a wildlife observation platform on a site just south of the community formerly slated for the development of a YMCA for Worcester County, the Maryland Court of Special Appeals opined this week.
In what was a complicated situation from the beginning, developer Marvin Steen in 2002 donated 26 acres of a larger parcel just south of Ocean Pines for the development of a future northern Worcester County YMCA along with an associated Atlantic General Hospital Wellness Center, a new Ocean Pines Chamber of Commerce building and other amenities.
In exchange, the Ocean Pines Association agreed to provide sewer service for the YMCA property as well as additional sewer service for remainder of the Steen property, which was to be developed with around 60 residential lots.
In September 2002, Ocean Pines voters approved the allocation of water and sewer to the property in a referendum vote. A condition of the water and sewer swap for a future YMCA was that a building permit be secured within five years of the conveyance of the property, or the land would revert back to the ownership of the OPA.
“If a building permit is not issued within five years from the date of the conveyance from Steen, the YMCA parcel of land shall, at the option of the OPA, revert back to ownership of the OPA,” the agreement read.
However, years passed and no permits for a future YMCA were issued by the county, largely because of development restraints on the property caused in part by the state’s new Critical Areas laws. Just before the five-year deadline expired, the YMCA obtained a building permit to construct a wildlife observation deck on the property, which it believed satisfied the conditions of the transfer of the property.
However, the OPA disagreed, asserting the observation platform was never part of the plan for the property and that because the YMCA did not obtain a building permit for the proposed 57,000-square-foot facility within the prescribed five-year deadline, ownership of the property should revert back to the OPA. Essentially, the case boiled down to a simple matter of semantics, or a question of whether the agreement meant “a” building permit, or “the” building permit for the YMCA facility.
At an impasse over the technical aspects of the conveyance agreement and the building permit obtained for a bird-watching platform and not a 57,000-square-foot YMCA facility, the OPA filed suit in Worcester County Circuit Court seeking the return of the land to the community association.
Last January, however, a visiting Worcester County Circuit Court judge ruled in favor of the YMCA, asserting the language of the original agreement did not rely on a specific type or scope of building permit for the property, only that a building permit be obtained within the five-year window.
The OPA immediately filed an appeal with the state’s Court of Special Appeals seeking a reversal of the lower court’s decision. This week, however, the Court of Special Appeals issued an opinion upholding the Circuit Court’s decision. The central element in the OPA’s appeal is the issue of the building permit. Because the higher court ruled in favor of the YMCA on that issue, the other issues raised on appeal became moot.
“The appellee has satisfied the sole condition of the contract by obtaining a building permit,” the opinion reads. “Because we agree with the appellee that it has satisfied the sole condition of the conveyance agreement, we will not address its other arguments.”
The Court of Special Appeals opinion points out the original conveyance agreement included no language specific to the construction of a YMCA on the Steen property, even though it was implied that it was the intent.
“The deed does not make any reference to any particular type of building permit, or to any particular type of facility, nor does it set requirements for the types of amenities or activities that the facility should include,” the opinion reads. “We agree with the YMCA that if it was the parties’ intention to require a particular kind of facility, namely one with a gymnasium, swimming pool etc., then the conveyance agreement should have included language to reflect this intent. As it is, the agreement includes only broad terms, which we are compelled to interpret in the appellee’s favor.”
In the end, the appeals court ruled the language in the conveyance agreement did not clearly require a building permit for a future YMCA be obtained.
“The ambiguity in the present case, if any, involves the definitions of the terms facility, building permit and conceptual plan,” the opinion reads. “We agree with the YMCA that the words in the conveyance agreement are unambiguous. The terms building permit, facility and conceptual plans are susceptible of a clear and definite understanding and there has been no allegation or evidence of fraud, duress, or mutual mistake in the execution of the agreement.”