Lone Mountain Shores Owners Association, Inc. v. Bennafield
Claiborne · TN · Tennessee Court of Appeals
Member win · rentals
What happened
In late 2022 the Lone Mountain Shores Owners Association sued several owners in Claiborne County Circuit Court to enjoin Airbnb/VRBO-style short-term rentals after years of such use. On competing summary-judgment motions focused on 2013 Amended Covenants §§ 2.14, 6.04, and 6.07, the trial court found the rental language ambiguous and ruled for the owners. On June 9, 2025, the Tennessee Court of Appeals affirmed.
What the court (or agency) held
Restrictive covenants are strictly construed against the party seeking to restrain use. Lone Mountain Shores' covenants defined single-family residential purposes and banned certain multi-occupancy/commercial lodging uses, but did not clearly and expressly prohibit short-term platform rentals of a whole dwelling to one housekeeping unit. Because the rental language was ambiguous and susceptible to more than one reasonable reading, it could not enjoin the owners' Airbnb/VRBO use. Summary judgment for the owners was affirmed.
Why this matters for members
Ambiguity in rental covenants is resolved against the association seeking to restrain use. Language aimed at simultaneous unaffiliated housekeeping units or hotel-like services does not automatically ban whole-house short-term rentals absent a clear duration ban.
What the member did
Litigated covenant interpretation on summary judgment, arguing the documents regulate simultaneous unaffiliated occupancy rather than length of stay.
Questions for the board
- Do the recorded covenants expressly define or ban short-term or platform rentals by duration?
- If short-term rentals were tolerated for years, what written policy change and owner notice support a new enforcement campaign?
- Before suing, was amendment of the covenants considered instead of litigation over ambiguous text?
Questions for a lawyer
- Under Pandharipande and this opinion, is the covenant language here ambiguous as to whole-dwelling STRs?
- What defenses (waiver, estoppel, laches) remain if the association later amends the covenants?
- What evidence of 'one housekeeping unit' vs multi-occupancy use matters on a developed record?
Citation
Lone Mountain Shores Owners Association, Inc. v. Bennafield, No. E2024-00569-COA-R3-CV (Tenn. Ct. App. June 9, 2025) (2025-06-09). Tennessee Court of Appeals. Outcome chip: member_win. Source: https://law.justia.com/cases/tennessee/court-of-appeals/2025/e2024-00569-coa-r3-cv.html
_General information, not legal advice. Outcomes turn on facts and current law._
General information, not legal advice. Outcomes turn on facts and current law.