Introduction

In Jill K. Jinks v. Sea Pines Resort LLC, Nos. 22-2013 & 22-2056 (4th Cir. Aug. 12, 2025) (unpublished), the United States Court of Appeals for the Fourth Circuit unanimously affirmed summary judgment in favor of several community-association defendants on claims seeking to invalidate an amendment to the 1974 covenants governing the Sea Pines Plantation on Hilton Head Island, South Carolina.

The litigation arose after Community Services Associates, Inc. (“CSA”)—a nonprofit manager of common property—called a referendum to impose a new annual assessment for infrastructure improvements. Although CSA was not one of the parties expressly authorized to initiate such a referendum, 88 percent of voting property owners approved the amendment. Plaintiff Jill K. Jinks, a property owner and trustee, attacked the process, contending that the call was unauthorized and that the amendment was therefore void.

The district court, and now the Court of Appeals, disagreed. Adopting South Carolina’s common-law doctrine of ratification, the Fourth Circuit held that an overwhelming vote of informed property owners “cures” a procedural defect in the initiation of a referendum—so long as the voters had knowledge of all facts material to the obligations created. The court further applied the business-judgment rule to shield a sister organization’s decision to endorse the amendment. The case fashions a clear rule for future community-association governance disputes: a super-majority vote by those with amendment authority can ratify an otherwise unauthorized initiation, rendering the amendment enforceable.

Summary of the Judgment

• Referendum Validity: Even assuming CSA lacked authority to call the referendum, the property owners (“PPOs”)—who did possess that authority—validly ratified CSA’s act by voting in favor of the amendment.
• Material-Knowledge Requirement: For ratification, PPOs needed knowledge of facts material to the obligations created (i.e., the new assessment and its purpose), not knowledge of CSA’s lack of authority.
• Business-Judgment Rule: The Association of Sea Pines Plantation Property Owners, Inc. (“ASPPPO”) did not breach its bylaws by endorsing the referendum; its actions were within its statutory and bylaw authority and therefore protected under South Carolina’s business-judgment rule.
• Permanent Injunction: Because the substantive claims failed, injunctive relief was correctly denied.
• Disposition: District court judgment affirmed in full; concurring opinion by Judge Wynn agreed with the outcome but offered unspecified alternative reasoning.

Analysis

1. Precedents Cited & Their Influence

The panel relied heavily on South Carolina agency-law precedent to frame the ratification analysis and on corporate-governance precedent for the business-judgment rule:

• Lincoln v. Aetna Cas. & Sur. Co., 386 S.E.2d 801 (S.C. Ct. App. 1989) – sets the three-part test for ratification: (i) acceptance of benefits; (ii) full knowledge of material facts; and (iii) conduct showing intent to adopt the unauthorized act.
• Mortgage & Acceptance Corp. v. Stewart, 140 S.E. 804 (S.C. 1927) – early articulation of ratification elements.
• Anthony v. Padmar, Inc., 465 S.E.2d 745 (S.C. Ct. App. 1995) – addresses an agent’s fiduciary duty to disclose material facts; cited to rebut Jinks’s disclosure argument.
• Certus Bank, N.A. v. Bennett, No. 2016-UP-090, 2016 WL 757501 (S.C. Ct. App. Feb. 24, 2016) – clarifies that ratification presupposes no prior authority.
• Fisher v. Shipyard Village Council of Co-Owners, Inc., 760 S.E.2d 121 (S.C. Ct. App. 2014) & Dockside Ass’n Inc. v. Detyens, 352 S.E.2d 714 (S.C. Ct. App. 1987) – define South Carolina’s business-judgment rule applicable to homeowners’ and condominium associations.
• Statutory anchor: S.C. Code § 33-31-302(18) – nonprofit corporations’ general powers.

These authorities collectively shaped the panel’s two key holdings: (a) the super-majority vote met all ratification elements; and (b) ASPPPO’s endorsement was an intra-vires act entitled to deference.

2. The Court’s Legal Reasoning

a. Ratification Doctrine Applied

Ratification allows a principal to adopt an agent’s unauthorized act retroactively. The court treated the PPOs as the principal; CSA was the agent. Even if CSA stepped outside its authority, the PPOs—by voting—(1) accepted the benefits (funding infrastructure) and burdens (paying the assessment), (2) had full knowledge of material facts (amount, purpose, duration), and (3) affirmatively elected to proceed (ballots cast).

The pivotal analytical step was limiting “material facts” to information bearing on the obligations created, not on CSA’s authority. Knowledge of a procedural irregularity was deemed immaterial; otherwise, ratification could never occur, because the doctrine assumes the agent lacked authority at the time.

b. Rejecting the Ultra Vires Argument

Jinks raised—belatedly—the notion that CSA’s actions were ultra vires and thus unratifiable. The panel held the argument forfeited and, in dicta, noted that the PPOs themselves had the authority to call a referendum, so the act was not substantively ultra vires—only procedurally unauthorized. Such acts are precisely those susceptible to ratification.

c. Business-Judgment Rule Shield

ASPPPO’s endorsement faced a breach-of-contract theory under its bylaws. The court invoked the business-judgment rule, a presumption that non-profit directors act in good faith, within their authority, and for the association’s best interests. Because promoting infrastructure clearly aligns with ASPPPO’s purpose and state law confers broad powers, the act was intra-vires, and no evidence of bad faith or corrupt motive existed. The plaintiff’s suggestion that ASPPPO should have solicited additional legal opinions did not overcome the presumption.

3. Likely Impact on Future Disputes

• Finality of Covenant Amendments: Community associations within the Fourth Circuit (and persuasively elsewhere) now have clear authority to rely on a super-majority vote to validate amendments, even if the initiation step was procedurally flawed.
• Reduced Litigation Over Technical Defects: Plaintiffs challenging amendments on initiation-authority grounds will bear a heavy burden where a later vote shows overwhelming support.
• Expanded Protection for HOA Boards: The decision reinforces generous application of the business-judgment rule to voluntary endorsements and advocacy by property-owner associations.
• Clarification of “Material Facts” in Ratification: Knowledge of legal authority (or the lack thereof) is not material unless it alters the obligations being accepted, a principle that may extend into agency, corporate, and contract law beyond the property context.

Complex Concepts Simplified

• Ratification: Imagine someone (the “agent”) orders a product for you without your permission. If you later discover the order, like the product, and pay the invoice, you have “ratified” the unauthorized purchase; it becomes as if you ordered it yourself.
• Ultra Vires: Latin for “beyond the powers.” An act is ultra vires when an entity lacks any legal power to perform it (e.g., a charity buying stock in a for-profit subsidiary if prohibited by its charter). Procedural missteps, by contrast, are usually not ultra vires.
• Business-Judgment Rule: Courts generally will not second-guess decisions of corporate or association boards that (1) stay within their authority, (2) are made in good faith, and (3) have a rational connection to the organization’s purpose—even if, in hindsight, the decision proves unwise.
• Participating Property Owners (PPOs): A defined subset of owners entitled to vote on Sea Pines Plantation referenda—typically everyone except the original developer.

Conclusion

Jinks v. Sea Pines Resort LLC crystallizes a practical doctrine for community-association governance: when those empowered to amend covenants do so by a decisive, informed vote, their action ratifies and legitimizes earlier procedural missteps in initiating the process. This “Jinks Ratification Rule” enhances predictability, curbs technical challenges, and underscores the autonomy of property owners to govern themselves. Coupled with a robust business-judgment shield for association boards, the decision will likely discourage litigation aimed at derailing widely supported amendments over procedural quibbles, thereby promoting efficient, democratic self-management in planned communities across the Fourth Circuit and beyond.