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Ruling affirms control of developer

MADISON — The Wisconsin Supreme Court affirmed Wednesday that control over development of the Geneva National community remains in the hands of the developers, not the property owners.

Three homeowners in the upscale, gated community in Geneva Township in early 2007 sued the developers. They argued residents should have more control over development of the community.

Forward Geneva National, a division of the real estate company Keefe and Associates, the developers of the community, argued a community association board that gives nearly equal say among all the entities—condominium owners, single-family homeowners, business owners and golf course operators—decides what happens.

Geneva National was created in 1990. It was tabbed to have 1,950 units, and more than 50 percent have been sold to date. If 85 percent of the lots in the community are sold, then the developers lose their control as outlined in the original developers agreements.

A Walworth County judge in late 2007 ruled in favor of the developers. The court said the master-planned community does not fall under state condominium laws, under which developers lose their control after 10 years or after selling 75 percent of the units, whichever comes first.

The 2nd District Court of Appeals in late 2009 agreed. The appeals court ruled that planned communities, such as Geneva National, "are an entirely different type and level of development than condominiums" and not subject to state condominium laws.

The Wisconsin Supreme Court agreed Wednesday.

Justice Patience Roggensack in her opinion wrote that the development plan for Geneva National not only guides the development of the 1,600-acre community according to the developer's vision, it also serves to protect property owners in the community "by assuring that their common interest in developing such a community according to the overarching development plan will be honored as development continues."

Roggensack noted that "extended developer control is necessary to properly market and uniformly develop" a large, complex property such as Geneva National.

Brad Hoeschen, the attorney representing the three homeowners, said his clients now are considering how to approach the state Legislature about the laws in questions.

"My clients are disappointed and continue to believe the Wisconsin statutes give them some protection over the developer controlling everything that goes on in their community for an indefinite period of time," he said. "They appreciate the comments from (two of the justices) that the Legislature has to deal with this issue."

John Brady, the attorney representing Forward Geneva National, said he was pleased with the decision by the high court.

"It was a well reasoned and well written decision, and it should permit Geneva National once again to prosper as it has in past with all questions as to its governance solved," he said.