# EIS Dev. II, LLC v. Buena Vista Area Ass'n

Supreme Court of Texas, No. 23-0365

**EIS Dev. II, LLC v. Buena Vista Area Ass'n, No. 23-0365 (Tex. June 13, 2025). Holding: The restriction limits the density of residential development and not tract size, and the only reasonable implication from its text is that one residence may be built on each platted tract of fewer than five acres, so the Association's claim for declaratory and injunctive relief fails; the Association and its members did not waive or abandon their right to enforce the restrictions; the jury was erroneously instructed to ignore changes before EIS's purchase, requiring a new trial on the changed-conditions counterclaim; and nonparty landowners and the State need not be joined.**

Practice areas: real property, civil procedure

## Key issues

- A deed restriction that "[n]o more than two residences may be built on any five acre tract" limits density, not tract size, and the only reasonable implication from its text is that one residence may be built on a sub-five-acre platted tract, so the restriction does not bar a developer from building one house on each of 73 one-to-two-acre lots carved from 100 restricted acres; the Court rendered judgment against the neighbors.
- In a changed-conditions defense or counterclaim to a deed restriction, the factfinder must consider all changes since the restriction was created, not only those after the current owner bought, so the jury instruction was erroneous and a new trial is needed; the Court also held the neighbors did not waive the restriction and that nonparty landowners and the State are not necessary parties.

## Factual History
Between 1988 and 1993 the State acquired over 10,000 tracts in Ellis County for the Superconducting Super Collider and, after the project was defunded, had the General Land Office sell them subject to "Level 5 Restrictions," which provide that "[n]o more than two residences may be built on any five acre tract" and may be enforced by any adjoining landowner (Opinion, PDF pp. 2-4). In 1988 the State sold adjoining parcels of ninety and almost ten acres to David Lemon with those restrictions, and in 2019 Lemon sold them to Salvador Family Holdings without referencing the restrictions; the parcels later passed to EIS Development II, LLC, which planned a 73-lot residential development, each lot over one acre and all but one under two acres (Opinion, PDF p. 4). EIS's owner testified that he did not know of the restrictions when he bought, and in September 2020 Waxahachie's Planning & Zoning Commission approved the final plat without objection from nearby landowners, with the Ellis County Commissioners' Court's approval following by operation of law (Opinion, PDF p. 5).

## Procedural History
Three adjoining landowners formed the Buena Vista Area Association and sued EIS in December 2020, seeking declarations that developing homes under the approved plat would violate the restriction and that it limits development to forty residences, plus an injunction; EIS raised a plea in abatement for joinder, waiver, abandonment, estoppel, and changed conditions, and counterclaimed for a declaration that the restrictions are unenforceable (Opinion, PDF pp. 5-6). The trial court granted partial summary judgment for the Association, held the restriction unambiguously limits development to two main residences per five-acre tract, issued an injunction capping the development at forty residences, and, after a jury instructed to ignore pre-purchase changes failed to find changed conditions, entered final judgment for the Association (Opinion, PDF p. 7). The court of appeals affirmed (Opinion, PDF pp. 7-8). EIS petitioned for review on May 18, 2023, and the Association responded on August 22, 2023; the Court requested merits briefing on September 29, 2023, granted the petition on May 31, 2024, heard argument on October 2, 2024, and decided the case on June 13, 2025 (Docket; Opinion, PDF pp. 1, 25).

## Issues Presented
EIS presents whether the restriction unambiguously establishes a density limitation of one residence per 2.5 acres, whether the court of appeals erred in the joinder ruling, whether it erred in rejecting waiver or abandonment, and whether the changed-conditions instruction and findings were erroneous (Brief on the Merits (EIS Development II, LLC), PDF p. 22; Petition for Review (EIS Development II, LLC), PDF p. 16). The Association presents whether the trial court abused its discretion in declining to compel joinder when no nonparty had claimed an interest, whether the restriction unambiguously establishes a density limitation, and issues on waiver and changed conditions (Brief on the Merits (Buena Vista Area Association, et al), PDF p. 13). The Court decided the meaning of the restriction for the platted sub-five-acre tracts, and also waiver, changed conditions, and joinder (Opinion, PDF p. 8).

## Standard(s) of Review
Deed restrictions are construed under the general rules of contract construction, a restriction is unambiguous if the text plainly addresses the use at issue and ambiguous only if it is subject to two or more reasonable interpretations after applying the rules of construction, and covenants restricting the use of property are not favored (Opinion, PDF pp. 9-10 & n.4).

## Legal Arguments
**What the "no more than two residences" restriction allows on the platted tracts.**

**Petitioner (EIS):** The restriction is ambiguous, or at most reaches only five-acre tracts, and engrafting an unstated minimum lot size on it was improper, so the injunction imposes a density restriction not found in the plain language (Brief on the Merits (EIS Development II, LLC), PDF p. 33; Petition for Review (EIS Development II, LLC), PDF p. 26; Opinion, PDF pp. 11-12).

**Respondents (the Association and adjoining landowners):** On the 100 acres now owned by EIS, only forty main residences can be built, and the restrictions protect the area from suburban sprawl (Brief on the Merits (Buena Vista Area Association, et al), PDF p. 30; Response to Petition (Buena Vista Area Ass'n, et al), PDF p. 15; Opinion, PDF p. 12).

**Waiver, changed conditions, and joinder.**

**Petitioner (EIS):** The adjoining landowners waived enforcement by not objecting to the plat and by tolerating other violations, the trial court wrongly confined the changed-conditions inquiry to post-purchase changes, and the trial court should have abated the case to join the State and all adjoining landowners (Brief on the Merits (EIS Development II, LLC), PDF pp. 22, 33; Opinion, PDF pp. 17-24).

**Respondents (the Association and adjoining landowners):** Rule 39 requires joinder only of nonparties who actually claim an interest in the subject of the suit, and no evidence showed any nonparty had done so (Brief on the Merits (Buena Vista Area Association, et al), PDF p. 13).

## Stated Reasons the Court Should Take the Case
EIS argued that the court of appeals' reading imposes a density restriction not found in the plain language, mishandles the plat approved without objection, and errs on joinder, waiver, and changed conditions (Petition for Review (EIS Development II, LLC), PDF p. 26). The Association responded that the case concerns a unique set of restrictions limited to Ellis County that does not present an issue of statewide importance (Response to Petition (Buena Vista Area Ass'n, et al), PDF p. 15).

## Oral Argument

- **Intent or notice.** Asked whether the test is the drafters' intent or buyer notice, the neighbors' counsel said intent, in the context of the State selling thousands of acres for consistent development. (Oral Argument, 0:27:52; 0:28:22)
- **Long-time owner versus buyer.** Asked how changed-conditions rules treat long-time owners and recent purchasers differently, the neighbors' counsel said they are not in the same position, since a purchaser takes with notice. (Oral Argument, 0:32:19; 0:32:56)
- **Why five acres.** Asked why the restriction speaks of two residences per five-acre tract, not a minimum lot size, EIS's counsel said likely platting: the city platts tracts of five acres or less. (Oral Argument, 0:03:13)
- **Planning issue.** Asked to respond to the claim this is just a planning issue, the neighbors' counsel said Chapter 212 of the Local Government Code is not referenced in the deed restrictions. (Oral Argument, 0:18:27)
- **Other tracts.** Asked what the record shows about other five-acre tracts, EIS's counsel said it says little, but the area was 40% to 50% covered by similar restrictions. (Oral Argument, 0:10:25)
- **Waiver and changed conditions.** Asked whether waiver or changed conditions was meant, EIS's counsel said waiver looks at changes within the restricted area, while changed conditions looks at the surrounding area. (Oral Argument, 0:12:01)

## Practice Area Tags
real-property, civil-procedure

## Procedural Posture/Vehicle
Petition for review from the Eighth Court of Appeals after a partial summary judgment and a jury trial on changed conditions; argued October 2, 2024, and decided June 13, 2025, with an opinion dissenting in part (Opinion, PDF pp. 1, 7-8, 25).

## Amicus Involvement
None. The docket shows no amicus filings.

## Holding
The restriction limits the density of residential development and not tract size, and the only reasonable implication from its text is that one residence may be built on each platted tract of fewer than five acres, so the Association's claim for declaratory and injunctive relief fails; the Association and its members did not waive or abandon their right to enforce the restrictions; the jury was erroneously instructed to ignore changes before EIS's purchase, requiring a new trial on the changed-conditions counterclaim; and nonparty landowners and the State need not be joined (Opinion, PDF pp. 2, 11-25).

## Court's Reasoning
**Meaning of the restriction.** Restrictive covenants are not favored, and the language must be clear and give adequate notice of the specific restriction to be enforced, so a use the text does not unambiguously address will not be barred; the omitted-case canon directs that nothing be added to what the text states or reasonably implies (Opinion, PDF pp. 9-10). The restriction limits density, not tract size, but it is incomplete because it does not state the density for sub-five-acre tracts (Opinion, PDF p. 11). The Court rejected EIS's reading that it applies only to tracts of exactly or at least five acres and the Association's reading that it sets a five-acre minimum usable tract size, because tract size and density are distinct and the parties gave no notice of a minimum-tract-size restriction (Opinion, PDF pp. 11-12). It rejected the dissent's reading that no more than forty residences may be built on the original 100 acres, because that rewrites "on any five acre tract" as "per five acres," ignores that "tract" means a specified parcel and the plat created seventy-three tracts, and writes in a minimum-acreage requirement (Opinion, PDF pp. 12-14). The reasonable implication is that one residence may be built on a tract of any size, with a second allowed on a tract of at least five acres and a third prohibited, so one house on each tract does not violate the restriction (Opinion, PDF pp. 14-15). The Court answered the dissent's concern that this nullifies the restriction by noting that, without it, two or more residences could be built on a sub-five-acre tract, and it left open whether differently worded restrictions would yield a different result (Opinion, PDF pp. 15-17).

**Waiver or abandonment.** Waiver is intentional relinquishment of a known right or conduct unequivocally inconsistent with claiming it, and failing to make a futile objection to the plat, which the city and county had no authority to enforce against, is not unequivocally inconsistent with claiming the right; nor did tolerating violations in nonadjoining subdivisions waive a right the Association never had there (Opinion, PDF pp. 17-19).

**Changed conditions.** The doctrine asks whether it remains possible to secure in a substantial degree the benefits the restriction was meant to achieve, which turns on the restriction's obsolescence, purpose, and effect, not on notice or who owns the land, so the factfinder must consider all changes since the restriction was created and the Court disapproved decisions holding otherwise (Opinion, PDF pp. 20-22). The instruction to consider only post-purchase changes was erroneous and a new trial is required (Opinion, PDF p. 22).

**Joinder.** Rule 39(a)(2) requires joinder of persons who actually claim an interest, and under *In re Kappmeyer* and *Crawford* a nonparty who merely has an interest through a deed, or the State, which has a statutory right to enforce restrictions in transfer documents, has not claimed one, so the plea in abatement was properly denied (Opinion, PDF pp. 22-25).

**Dissent in part (Justice Lehrmann, joined by Justice Huddle and Justice Young).** She joined Parts II, III, and IV, but would have held that the Court answered the wrong question by focusing on the seventy-three lots instead of the 100 acres the restriction was attached to, and that the restriction unambiguously caps the 100 acres at forty main residences, because a reading that lets an owner avoid the restriction by subdividing would nullify it (Lehrmann, J., dissenting in part, PDF pp. 1-13). She would have remanded for a new trial on the Association's claims as well (Lehrmann, J., dissenting in part, PDF p. 3 n.2).

## Disposition
The Court reversed the judgment awarding the Association declaratory and injunctive relief and rendered judgment that the Association take nothing on its claims, and it reversed the judgment on changed conditions and remanded for a new trial on that counterclaim (Opinion, PDF p. 25).

## Vote Breakdown
Justice Busby delivered the opinion of the Court, joined by Justices Boyd, Devine, Bland, and Sullivan, by Chief Justice Blacklock as to Part I, and by Justices Lehrmann, Huddle, and Young as to Parts II, III, and IV; Justice Lehrmann filed an opinion dissenting in part, joined by Justices Huddle and Young (Opinion, PDF p. 1).


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Source: The SCOTX Report, https://scotxreport.com/cases/23-0365. AI-generated summary of the Court's opinion, orders and the parties' briefs, with pin cites to the page of each document; verify against the Court's own documents at search.txcourts.gov.