Houses of Horror
The Houston Chronicle, 2003
By Rick Casey
Which would you rather have: The American dream of owning a home, or Your right to free speech?
KB Home, one of the largest homebuilders in the nation and in Texas, offers you the choice. They don't exactly put it that way. If they did they might not be a $5 billion Fortune 500 company selling 25,000 homes a year.
No, they present the choice quietly, nestled deep inside a couple dozen pages of deed restrictions. It falls between the paragraph saying you have to honor utility easements and the paragraph forbidding "outdoor clothes lines and drying racks visible to adjacent properties." The paragraph in question is lengthy, and deserves to be quoted at length.
"No sign of any kind or character, including (a) any signs in the nature of a `protest' or complaint against Declarant (KB Home) or any homebuilder, (b) or that describe, malign or refer to the reputation, character or building practices of Declarant or any homebuilder, or (c) discourage or otherwise impact or attempt to impact anyone's decision to acquire a lot or residence in the Subdivision shall be displayed to the public view."
So you can't promote a mayoral candidate or welcome home a son or daughter from a tour of duty in Iraq. An exception is made for a single "for sale" or rent sign as long as it is "professionally fabricated" and not larger than 5 square feet.
"any home builder or their agents shall have the right, without notice, to remove any sign, billboard or other advertising structure that does not comply with the above, and in so doing shall not be subject to any liability for trespass or any other liability in connection with such removal."
A violation can result in a fine of $100 a day.
"The non-payment of such fine can result in a lien against said Lot, which lien may be foreclosed on ... by the Declarant or any Owner in the Subdivision."
If you're one of the many who don't want signs in your neighbors' yards anyway, consider the next sentence.
"Moreover, no Owner may use any public medium such as the `internet' or any broadcast or print medium or advertising to similarly malign or disparage the building quality or practices of any homebuilder, it being acknowledged by all Owners that any complaints or actions against a homebuilder or Declarant are to be resolved in a private manner and any action that creates controversy or publicity for the Subdivision or the quality of construction of any homes within the Subdivision will diminish the quality and value of the Subdivision."
So it's not just those unsightly lawn signs. You may not give a television interview, write a letter to the editor, post a message on a Web site or go on a radio talk show to discuss any problems you may have had with a homebuilder.
And you may not use any of those media to discuss the practices of any homebuilder. A spokeswoman at KB's Los Angeles headquarters said Friday afternoon such language has become something of an "industry standard."
I'll investigate that further next week, and I'll examine the state of the law on such free-speech restrictions. Alice Oliver-Parrott, former chief justice of the 1st Court of Appeals here, now represents homeowners in controversies with builders. She says the notion that the restriction is an industry standard suggests the industry should examine its product.
"You can complain about your car or your washing machine," she said.
But the KB spokeswoman stressed that the provision is not to protect KB Home from bad publicity. It's to protect neighbors from damaged property values. And she says it is the homeowners' associations, not KB Home, that enforce the restrictions. Feel better?
Houston Chronicle, 2003
By Rick Casey
GOOD NEWS regarding Sunday's column ("Buy a home and shut up!") on KB Home's deed restrictions forbidding home buyers from complaining publicly about homebuilders.
If you missed the column, it reported language in KB's deed restrictions that barred all yard signs except "For Sale" signs and specifically barred yard signs that criticize any homebuilder. As if that wasn't bad enough, the deed restrictions bar homeowners from using "any public medium such as the 'internet' or any broadcast or print medium or advertising to similarly malign or disparage the building quality or practices of any builder."
The good news is that KB Home's regional general manager for Texas said Tuesday that the company will omit that language in future subdivisions. "It's the right thing to do," said Larry Oglesby, who offices in Austin. "Based on the information we read in your column, we're certainly willing to redo the language on any community going forward and remove it," he said.
He said he spoke for the Texas division but that he expected the company's national executives to take a look at the issue as well.
The language will remain in KB Home subdivisions that have already been built. It would be legally difficult to excise the language from deed restrictions already in place. But Oglesby stressed that KB Home has never enforced that language in a deed restriction. The company is unlikely to court the publicity that would come from doing so. But as Oglesby pointed out, once subdivisions are built out, enforcement of deed restrictions is turned over to homeowners associations.
It takes no large stretch of the imagination to foresee an association enforcing it. The motivation would be that, as the language of the deed restriction points out,
"any action that creates controversy or publicity for the Subdivision or the quality of construction of any homes within the Subdivision will diminish the quality and value of the Subdivision."
When it comes to property values, some Americans can be expected to forget the Bill of Rights, and they may well be in the majority. But the Bill of Rights wasn't written to protect the majority.
There is very little case law on whether deed restrictions can trump freedom of speech. The only case I found that appeared to apply was out of the Texas Court of Appeals in Austin.
Homeowners had signed a contract with very similar language after receiving compensation from a homebuilder. After finding more problems in their home, the owners went to the media. The appeals court held that there may be some instances in which people can sign away their free speech rights, but it must be shown that they did so "knowingly, voluntarily, and intelligently."
Signing a deed restriction with that language buried amid a couple of dozen pages clearly would not suffice, according to the Austin court.The matter was not appealed to the more conservative Texas Supreme Court, however, and it could disagree. It could rule that when any adult signs a contract, no matter how long, it should be assumed he or she understood implications.
For now, concern over the court of public opinion seems to rule, at least in the case of KB Home in Texas.
One other bit of good news: When a Los Angeles spokeswoman for KB Home said such language had become something of "an industry standard," it was something of an exaggeration. Bobby Bowling, president of the Texas Association of Builders, said the yard-sign restrictions were common but as for barring the use of the Internet or media to criticize homebuilders: "That's the first I've heard of that."
Apparently a few other homebuilders around the country are using such language in deed restrictions, but not many.
Houses of Horror