CHARLOTTE PAVILION ROAD RETAIL INVESTMENT, L.L.C., and WLA ENTERPRISES, INC., Plaintiffs,
NORTH CAROLINA CVS PHARMACY, LLC; JEFFREY CARPENTER; CARPENTER INVESTMENT PROPERTIES, LLC; SUBURBAN GARDENS INCORPORATED; and SONNY BOY PROPERTIES, LLC, Defendants
Heard in the Court of Appeals: October 22, 2014.
Appeal by defendants from order entered 11 March
2014 by Judge Linwood O. Foust in Mecklenburg County Superior Court, No. 13 CVS
ELLIS & WINTERS LLP, by Matthew W. Sawchak, Thomas D. Blue, Jr., Jeremy M. Falcone, Emily E. Reardon, for North Carolina CVS Pharmacy, L.L.C. and Sonny Boy Properties, LLC.
FERGUSON, SCARBROUGH, HAYES, HAWKINS & DEMAY, PLLC, by James R. DeMay, for Jeffrey Carpenter, Carpenter Investment Properties, LLC, and Suburban Gardens Incorporated.
MULLEN HOLLAND & COOPER, P.A., by John H. Hasty and Justin N. Davis, for Charlotte Pavilion Road Retail Investment, LLC, and WLA Enterprises, Inc.
ELMORE, Judge. Judges BRYANT and ERVIN concur.
In 2013, Charlotte Pavilion Road Retail Investment, L.L.C. and WAL Enterprises (collectively " developers" ) filed a declaratory judgment action against North Carolina CVS Pharmacy, L.L.C., Jeffrey Carpenter, Carpenter Investment Properties, LLC, Suburban Garden Incorporated, and Sonny Boy Properties, LLC (collectively " CVS" ). The developers sought a declaration that their proposed use of the land at issue did not violate a restrictive covenant. The developers moved for offensive summary judgment and Judge Linwood O. Foust granted the motion. CVS timely appealed. After careful consideration, we affirm.
The facts in this case are not in dispute. Jeffrey Carpenter, principal member of Carpenter Investment Properties, LLC, owned a fifteen acre tract of land (" the Carpenter tract" ) in north Charlotte. In 2006, Mr. Carpenter conveyed approximately two acres of the Carpenter tract to an entity that he controlled, Pavilion at Twenty Nine, LLC (" Pavilion" ). Pavilion leased the two acres to CVS Pharmacy (" CVS tract" ), which is still operating a pharmacy on the land today. Mr. Carpenter/Pavillion agreed to place a restriction in the CVS lease on the future use of the Carpenter tract to entice CVS to enter the lease agreement.
On 18 August 2008, Mr. Carpenter sold the CVS tract to Sonny Boy Properties, LLC. As part of the sale, Mr. Carpenter implemented the restriction outlined in the CVS lease by encumbering his adjoining land, the Carpenter tract, with a restrictive covenant. The restrictive covenant is recorded and runs with the land. The recorded covenant mirrors the restriction that appears in the CVS lease. It states:
During the term of the existing CVS lease . . . no owner of any portion of the Carpenter Tract shall allow its parcel to be leased or to be used for the purpose of a health and beauty aids store, a drug store, a vitamin store, and/or a pharmacy. A " pharmacy" shall include the dispensing of prescription drugs by physicians, dentists, or other health care practitioners, or entities such as health maintenance organizations, where such dispensing is for profit or a facility which accepts prescriptions which are filled elsewhere and delivered to the customer. A " health and beauty aids store" shall mean a store which devotes more than 10% of its retail selling space to the display and sale of health and beauty aids.
In 2012, Mr. Carpenter contracted to sell the restricted Carpenter track to the developers. The developers also contracted to purchase an adjacent tract of land (" the ...