Text, Not Intent: Density Restrictions and Creation-Date Changed Conditions in Texas – Commentary on EIS Development II, LLC v. Buena Vista Area Association

Text, Not Intent: Density Restrictions and Creation-Date Changed Conditions in Texas
Commentary on EIS Development II, LLC v. Buena Vista Area Association, Supreme Court of Texas (June 13, 2025)

I. Introduction

The Supreme Court of Texas’s decision in EIS Development II, LLC v. Buena Vista Area Association addresses two significant questions in Texas property and servitude law:

  • How to interpret an incomplete density restriction in a deed that says, “No more than two residences may be built on any five acre tract,” when the property has later been platted into tracts of less than five acres; and
  • From what point in time courts must measure “changed conditions” when deciding whether a restrictive covenant has become obsolete and should no longer be enforced.

Against the backdrop of Texas’s strong protection for free use of land and clear notice in property transactions, the Court adopts a firmly text-driven approach. It refuses to read into a recorded covenant a minimum lot-size requirement, even where neighboring landowners believe such a requirement is necessary to preserve a rural, low-density character. At the same time, an almost unanimous Court reshapes the “changed-conditions” doctrine by holding that factfinders must consider all changes since the covenant’s creation, not merely those occurring after the current owner acquired the property.

The case pits a developer, EIS Development II, LLC (“EIS”), against neighboring landowners organized as the Buena Vista Area Association (“the Association”), concerning a 100-acre tract in Ellis County once acquired by the State of Texas for the Superconducting Super Collider project. The outcome will influence how developers, landowners, and drafters of private land-use restrictions structure covenants and litigate their enforcement.

II. Factual and Procedural Background

A. The Super Collider Land and Level 5 Restrictions

Between 1988 and 1993, Texas acquired large swaths of land in Ellis County for the Superconducting Super Collider. After Congress canceled the project, the Texas General Land Office was charged with disposing of over 10,000 tracts. To guide future development, the Land Office created six “Levels” of recorded “covenants, conditions, and restrictions” (“CCRs”) to be placed in deeds.

In 1988, the State sold two adjoining parcels—one of about 90 acres and one of about 10 acres—to an individual, David Lemon. The deeds incorporated the so-called “Level 5 Restrictions.” The core provisions relevant here were:

1. No residential dwelling shall contain less than 2,200 square feet of floor space. The residence shall be used as a single family dwelling. No more than two residences may be built on any five acre tract. A guest house or servants’ quarters may be built behind a main residence location, but must be less than 900 square feet and of like construction as the main residence. Barns and outbuildings shall not be used for residential purposes.

2. The property is designated as residential, and shall be used for that purpose.

…

11. The term of these CCR's are to run with the land and shall be binding on all persons in title to the tract, in whole or part, for a period of twenty (20) years from the effective date of this deed, after which time they shall be renewed automatically for successive periods of ten years unless changed by agreement of 80% of adjoining property owners. The CCR's … may be enforced by any adjoining landowners…

Those CCRs “run with the land,” meaning they bind successors in title until they expire, are amended, or become unenforceable under doctrines such as waiver or changed conditions.

B. Transfer to EIS and the Sunset Meadows Subdivision

In 2019, Lemon sold the 90- and 10-acre tracts to Salvador Family Holdings. That deed did not recite or attach the Level 5 Restrictions, though they remained of record. Salvador later transferred the land to EIS Development II, LLC, owned by developer George Salvador.

EIS designed “Sunset Meadows,” a large-lot residential subdivision with:

  • 73 single-family residential lots;
  • Each lot over one acre; and
  • All but one lot under two acres.

The land lies within the extraterritorial jurisdiction (ETJ) of the City of Waxahachie, less than a mile from the city limits. According to EIS, this plat was consistent with the City’s and County’s development expectations and similar to another nearby subdivision it had already developed—even though that other subdivision was also subject to Level 5 CCRs and no one had sought to enforce them.

The Waxahachie Planning & Zoning Commission approved the Sunset Meadows plat in September 2020. Nearby landowners received notice, but none objected or appealed. EIS then sought Ellis County Commissioners’ Court approval. Under the Local Government Code, the County had 30 days to act or the plat would be deemed approved; the County chose not to act, so approval occurred “by operation of law.” A non-adjoining landowner raised the CCRs at the Commissioners’ Court hearing, but no adjoining landowner objected on that basis.

After plat approval, EIS began grading and excavating the property.

C. Neighbors Organize and Sue

Three adjoining landowners retained counsel and formed the Buena Vista Area Association to enforce the Level 5 Restrictions. Not all adjoining owners joined. In December 2020, the Association sued EIS seeking:

  • Declaratory judgment that:
    • Developing 73 homes on 73 sub‑5-acre lots “would violate” the deed restriction that “no more than two residences may be built on any five acre tract”; and
    • The restriction “limit[s] development” on the 100 acres to no more than 40 residences (two residences per five acres, i.e., 20 five-acre tracts).
  • Injunctive relief to stop any development violating the restriction.

EIS responded with, among other things:

  • A plea in abatement, arguing that nonparty adjoining owners and the State of Texas were necessary parties;
  • Defenses including waiver/abandonment, estoppel, and changed conditions (i.e., that circumstances had so altered that the restrictions were no longer enforceable); and
  • Counterclaims seeking declarations that the CCRs had been waived, abandoned, or rendered unenforceable by changed conditions.

D. Summary Judgment, Injunction, and Jury Verdict

On cross-motions, the trial court:

  • Granted partial summary judgment to the Association, holding that the Level 5 restriction “unambiguously” limits development to “no more than two main residences per five-acre tract,” effectively capping the 100 acres at 40 residences; and
  • Dismissed EIS’s defenses and counterclaims, except its changed-conditions theory.

The court also entered a temporary injunction limiting EIS to building no more than 40 main residences on the 100 acres, with at most two per five-acre tract.

A jury trial followed on the sole remaining issue: EIS’s changed-conditions defense/counterclaim. Critically, the jury charge instructed jurors not to consider any changes occurring before Salvador Family Holdings acquired the property in 2019. The jury failed to find changed conditions, and the trial court:

  • Entered final judgment for the Association;
  • Declared the deed restrictions valid and enforceable;
  • Held that EIS’s 73-lot plan violated the restriction; and
  • Permanently enjoined EIS from building more than two main residences (plus two guest houses) per five-acre tract.

The court of appeals (El Paso) affirmed, agreeing that:

  • Joinder of other adjoining landowners and the State was unnecessary;
  • The CCRs unambiguously imposed a density limit of two residences per five-acre tract; and
  • EIS’s waiver/abandonment and changed-conditions theories failed.

EIS petitioned for review, presenting five issues: necessary joinder, interpretation of the restriction, waiver/abandonment, the limitation of the changed-conditions charge to post-purchase changes, and sufficiency of evidence on changed conditions.

III. Summary of the Supreme Court’s Decision

A. Holdings

The Supreme Court (opinion by Justice Busby) resolves the case as follows:

  1. Interpretation of the density restriction: The phrase “No more than two residences may be built on any five acre tract” is an incomplete density restriction that:
    • Does not impose a minimum lot size of five acres; and
    • Does not prohibit building one residence on each platted tract smaller than five acres.
    The only reasonable implication is that sub‑5‑acre tracts may not have two or more residences, but may have one. Thus, EIS may build one residence on each of the 73 platted lots.
  2. Association’s claims: Because EIS’s planned development does not violate the restriction, the Court:
    • Reverses the declaratory judgment and permanent injunction in favor of the Association; and
    • Renders judgment that the Association take nothing on its claims.
  3. Waiver/abandonment: The Association did not waive or abandon its enforcement rights:
    • Failing to object to plat approval based on the CCRs is not waiver because city and county authorities lack power to enforce private deed restrictions in this context; an objection would have been futile.
    • Neighbors’ inaction regarding developments on non-adjoining tracts is not waiver because they had no enforcement rights there.
  4. Changed-conditions doctrine: A factfinder assessing “changed conditions” must consider all changes occurring after creation of the restriction, not just those arising after the current owner acquired the property. The Court:
    • Rejects the “post-purchase only” approach followed by some courts of appeals (e.g., Lebo v. Johnson, Oldfield v. City of Houston);
    • Holds that the doctrine focuses on obsolescence of the restriction’s original purpose, not on the timing of the current owner’s purchase; and
    • Because the jury charge improperly limited the evidence to post-purchase changes, orders a new trial on EIS’s changed-conditions counterclaim.
  5. Joinder of necessary parties: The State of Texas and nonparty adjoining landowners are not “necessary parties” under Texas Rule of Civil Procedure 39 because they have not actually claimed an interest in this litigation, even though they have a potential interest by virtue of their deeds or statute.

B. Alignment and Dissent

  • Justice Busby’s majority opinion is joined fully by Justices Boyd, Devine, Bland, and Sullivan.
  • Chief Justice Blacklock joins only Part I (interpretation of the restriction).
  • Justices Lehrmann, Huddle, and Young join Parts II–IV (waiver, changed conditions, joinder) but dissent from Part I. Justice Lehrmann writes a dissent, joined by Justices Huddle and Young.

Thus, the interpretation of the density covenant is a 6–3 textualist majority over a dissent favoring a more purpose-driven reading. The changed-conditions ruling and other parts command a broad majority.

IV. Detailed Analysis

A. Interpreting the “No More Than Two Residences” Restriction

1. Legal Framework: Clear Notice and Textualism in Restrictive Covenants

Texas has long been wary of encumbrances on the free use of land. The Court reiterates and builds on its recent restrictive-covenant jurisprudence:

  • Tarr v. Timberwood Park Owners Ass’n, 556 S.W.3d 274 (Tex. 2018):
    • Reaffirmed that “[c]ovenants restricting the free use of property are not favored” because the right to use one’s property is “fundamental.”
    • Held that short-term rentals were not barred by covenants requiring “single-family residence” use because the covenants did not unambiguously prohibit such rentals.
    • Articulated the rule that courts look to “the objective intent of the drafters of the restrictive covenant as it is reflected in the language chosen,” and if the covenant “unambiguously fail[s] to address the property use complained of,” that use cannot be barred.
  • Davis v. Huey, 620 S.W.2d 561 (Tex. 1981):
    • Emphasized that restrictive covenants bind subsequent purchasers only when “the language employed [is] clear” and gives “adequate notice … of the specific restriction sought to be enforced.”
    • Stated that a purchaser for value without such notice takes title free of the unexpressed restriction.

The Court also discusses the Texas Property Code’s instruction to “liberally construe” restrictive covenants “to give effect to [their] purposes and intent.” See TEX. PROP. CODE § 202.003(a). But it clarifies that this statutory rule of construction only helps decide whether a covenant is ambiguous. Citing Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd., 940 S.W.2d 587, 589 (Tex. 1996), the Court notes that ambiguity exists only when a text is subject to “two or more reasonable interpretations.” Liberal construction does not authorize courts to supply unexpressed terms to reach a perceived purpose.

In addition, the Court invokes the “omitted-case canon” of textual interpretation as described by Scalia and Garner in Reading Law:

“Nothing is to be added to what the text states or reasonably implies. That is, a matter not covered is to be treated as not covered.”

Relying also on In re CenterPoint Energy Houston Electric, LLC, 629 S.W.3d 149, 158–59 (Tex. 2021), and Tenneco Inc. v. Enterprise Products Co., 925 S.W.2d 640, 646 (Tex. 1996), the Court reiterates that:

  • Drafters are presumed to “choose[] each word” with care and to omit other words deliberately.
  • Courts must not “rewrite [texts] to insert provisions parties could have included or to imply restraints for which they have not bargained.”

In property law especially, Cosgrove v. Cade, 468 S.W.3d 32, 40 (Tex. 2015), is cited for the proposition that “bright lines and sharp corners” are essential because of the critical importance of “legal certainty and predictability” in property ownership.

2. Competing Interpretations of the Restriction

The crucial language is: “No more than two residences may be built on any five acre tract.” The dispute arises because the current plat divides the original 100 acres into 73 tracts, almost all between one and two acres. How many residences may EIS build under this language?

The positions are:

  • EIS’s rejected reading: The restriction applies only to exact five-acre tracts (or at most to tracts of five or more acres). If a tract is smaller than five acres, EIS argued, the restriction does not speak to it at all, so background law controls and multiple residences could be built.
  • The Association’s and lower courts’ reading: The language implicitly sets a minimum lot size of five acres and a density of two main residences per five acres, which scales across the 100 acres as a whole, yielding a cap of 40 main residences. On this view, subdividing into sub‑5‑acre lots is essentially a way to “evade” the restriction and should not be allowed.
  • The dissent’s approach (per the majority’s description): Focused on the original 90- and 10-acre parcels, the dissent reads the restriction as allowing no more than two residences “per five acres.” Because the 100 acres can be divided into 20 distinct non-overlapping five-acre units, a maximum of 40 homes is permitted across the entire area—regardless of how the land is platted into smaller tracts. The dissent relies heavily on the perceived original intent “that their neighborhood would not become jam-packed with homes” and warns against interpretations that “functionally nullify” the restriction.

All three approaches treat the covenant as a density control, but differ on:

  • Whether it also implicitly controls lot size; and
  • Whether the operative unit is the individual platted tract or some abstract aggregation of five-acre pieces across the original 100 acres.

3. The Majority’s Interpretation: An Incomplete Density Rule

The Court begins by characterizing the clause as a density restriction rather than a lot-size rule. It notes that “tract size and density of development on a tract are two distinct variables that affect land use,” and a restriction on one cannot automatically be read as a restriction on the other.

It then rejects both EIS’s narrow “only exact five acres” reading and the Association’s (and dissent’s) “per five acres across the whole property” theory as unreasonable interpretations of the text.

Several key moves underlie the Court’s reading:

  1. Focus on actual platted tracts as “tracts” under the covenant.
    • The Court uses Black’s Law Dictionary to define “tract” as a “specified parcel of land,” and notes that a subdivision plat under Local Government Code § 232.001(a) “divides the tract into two or more parts.”
    • When the plat for Sunset Meadows was recorded, it created 73 separate “tracts.”
    • The use of the word “any” signals that the covenant should apply to whichever tracts exist from time to time, not be frozen in place based on the original 90- and 10-acre configuration.
    • Accordingly, the operative question is how many residences may be placed on each of the seventy-three platted tracts, not on hypothetical five-acre aggregations across the entire 100 acres.
  2. No textual basis for a minimum tract size.
    • The deed nowhere says that residential use is limited to five-acre tracts or that tracts may not be subdivided below five acres.
    • The drafters “did not bargain for or provide notice of a minimum-tract-size restriction, and we are not free to insert one.”
    • The Court characterizes the dissent’s reading—which, as applied, would make sub‑5‑acre tracts unusable for any residence—as effectively adding a minimum-lot-size term that is not in the text.
  3. An implied “one residence per tract” rule.
    • The covenant affirmatively authorizes up to two residences “on any five acre tract.” This “rests on the assumption that one residence may be built on a five-acre tract.”
    • “Nothing suggests that the same assumption does not apply to tracts of fewer than five acres,” and “nothing in the deed prohibits construction of one residence on any tract.”
    • By the omitted-case canon, if the text does not clearly restrict one residence on a smaller tract, courts will not treat that use as barred.
    • The Court thus concludes it is reasonable to construe the restriction as:
      • Limiting sub‑5‑acre tracts to a single residence; but
      • Permitting up to two residences on a tract of at least five acres, and prohibiting a third.
  4. Only one reasonable implication applies to sub‑5‑acre tracts in this case.
    • The Court stresses that the specific factual scenario before it involves tracts between one and two acres.
    • Under the restriction, “the only reasonable implication from its text is that two residences (or more) may not be built on such tracts,” but “the restriction does not prevent the landowner from building one residence on each tract as planned.”
    • The Court explicitly declines to resolve all possible “finer details” or other hypothetical applications beyond the current facts.

In short, the Court treats the covenant as an incomplete density restriction that:

  • Sets a maximum of two residences on any tract of five acres or more; and
  • By reasonable implication and in light of the need for clear notice, permits one residence on any tract regardless of size, and bars two or more residences on the sub‑5‑acre tracts at issue here.

4. Rejection of the Dissent’s Purpose-Driven Reading

The dissent views the restriction as expressing a broader, general “per five acres” density cap aimed at preserving rural character. From that perspective:

  • The 100-acre area can be conceptually divided into twenty non-overlapping five-acre units, yielding a hard cap of 40 residences.
  • Allowing a 73-lot subdivision of one- to two-acre tracts would “functionally nullify” the original bargain and enable developers to circumvent the restriction via aggressive subdivision.

The majority responds on both textual and institutional grounds:

  • Textual concerns:
    • The dissent’s implicit rewrite from “on any five acre tract” to “per five acres” ignores the ordinary meaning of “tract” as an actual parcel and the importance of the recorded plat in defining tracts.
    • The dissent’s approach severs the restriction from the recorded tracts to which it was attached, turning it into a free-floating density rule applicable to “indefinite” five-acre aggregations.
    • This is not a “reasonable implication” from the existing language; it effectively imposes a new covenant prohibiting subdivision below five acres and setting a global density cap.
  • Institutional limits and omitted-case canon:
    • The Court stresses that it is not the judiciary’s role to fill “perceived gaps” based on what judges believe “the original parties” would have wanted.
    • Citing U.S. Polyco, Inc. v. Texas Central Business Lines Corp., 681 S.W.3d 383, 390 (Tex. 2023), it notes that interpretation “does not authorize courts to ensure that every provision comports with some grander theme or purpose.”
    • The parties to the original deeds “could easily have bargained for a minimum-tract-size restriction” or explicit “per 5 acres in the aggregate” language, but did not.
    • To enforce an unexpressed intention would be to “write the [text],” contravening Scalia and Garner’s view that “the absent provision cannot be supplied by the courts.”

The majority also rejects the suggestion that its reading “nullifies” the restriction. Without the covenant, an owner could place multiple residences on a sub‑5‑acre tract; under the Court’s interpretation, sub‑5‑acre tracts are limited to one residence, and five-acre tracts are capped at two. The covenant therefore still has a real (though more modest) effect on density.

5. Practical Consequences of the Interpretation

On the facts:

  • Each of the 73 platted lots is a “tract” under the covenant.
  • Because each is under five acres, the covenant implies that no more than one main residence may be placed on each.
  • EIS’s plan to build precisely one single-family home per lot does not violate the covenant.

More broadly:

  • Drafters of covenants who wish to preserve rural, low-density development must:
    • Expressly prohibit subdivision below a stated minimum acreage; and/or
    • Expressly state a global density cap (e.g., “no more than two residences per five acres across the entire tract as originally conveyed”).
  • Purchasers can rely heavily on the exact words in recorded restrictions; courts will not infer unstated limitations on property use based on generalized notions of neighborhood character.
  • Developers may find more room to work within older, vaguely drafted density covenants, so long as they:
    • Do not place multiple homes on individual tracts contrary to a clear density cap; and
    • Respect any explicit minimum lot-size or anti-subdivision provisions (if any).

B. Waiver and Abandonment of Restrictive Covenants

1. Legal Standards

Waiver in Texas law is “an intentional relinquishment of a known right or intentional conduct inconsistent with claiming that right.” Teal Trading & Dev., LP v. Champee Springs Ranches Prop. Owners Ass’n, 593 S.W.3d 324, 334 (Tex. 2020). Key points:

  • Waiver is a question of intent, discerned from conduct “in light of the surrounding facts and circumstances.”
  • It can occur through express statements or by “silence or inaction,” but only if such inaction is “unequivocally inconsistent” with later enforcement. Tenneco Inc., 925 S.W.2d at 643.

Cowling v. Colligan, 312 S.W.2d 943 (Tex. 1958), applied these principles to deed restrictions, holding that owners’ “acquiescence” in “substantial violations” in the restricted area can amount to abandonment or waiver, justifying refusal to enforce the covenant.

2. EIS’s Waiver Theories and the Court’s Rejection

EIS offered two waiver/abandonment theories:

  1. Failing to object at the plat-approval stage
  2. Allowing other alleged violations of the same CCRs in the broader Super Collider area without challenge
a. No Waiver from Failing to Object to Plat Approval

EIS argued that adjoining landowners effectively acquiesced in the 73-lot configuration by failing to object during the Waxahachie and Ellis County plat processes. The Court rejects this argument for two related reasons:

  • Futility of objections:
    • Under the Local Government Code, municipalities and counties generally cannot enforce or consider private deed restrictions when approving plats.
    • Municipal enforcement authority over deed restrictions is limited to:
      • Certain very large municipalities (population over 1.5 million); or
      • Municipalities without zoning ordinances. See TEX. LOC. GOV’T CODE §§ 212.151, 212.153.
    • Waxahachie is a small, zoned city; Ellis County likewise lacks authority to enforce private developer restrictions.
    • Once a plat conforms to the applicable public regulations, approval is a “ministerial duty.” Schroeder v. Escalera Ranch Owners’ Ass’n, Inc., 646 S.W.3d 329, 332 (Tex. 2022).
    • Thus, an objection grounded in private CCRs would not have affected plat approval; it would have been futile.
  • Futility is not waiver:
    • Because waiver requires conduct “unequivocally inconsistent” with asserting the right, failing to pursue a futile remedy does not suffice.
    • Underwood v. Webb, 544 S.W.2d 187, 190 (Tex. Civ. App.—Waco 1976, writ ref’d n.r.e.), is cited for the principle that violations that “could not have been prevented” cannot be counted toward waiver or abandonment.
b. No Waiver from Inaction on Non-Adjoining Properties

EIS also argued that the Association and its members abandoned the Level 5 Restrictions by failing to challenge similar dense developments on other former Super Collider tracts in the region.

But the parties stipulated that none of those other properties adjoin any of the Association members’ land. Under paragraph 11 of the CCRs, enforcement rights are expressly given to “adjoining landowners.” For non-adjoining parcels, the Association had no right to enforce these particular deed restrictions.

The Court reasons that failing to enforce a right one does not possess cannot be “unequivocally inconsistent” with later enforcement of a right one does possess. Therefore, these other developments cannot support waiver or abandonment as to the parcels at issue here.

As a result, the Court upholds the trial court’s rejection of EIS’s waiver/abandonment counterclaim and defense as a matter of law.

C. The Changed-Conditions Doctrine: Measuring from Creation of the Covenant

1. The Doctrine in Texas and the Restatement

A longstanding equitable principle allows courts to decline enforcement of a restrictive covenant when material circumstances have so changed that the covenant’s original purpose can no longer be substantially achieved.

In Cowling v. Colligan, 312 S.W.2d 943 (Tex. 1958), the Court held:

“[A] court of equity may refuse to enforce a restrictive covenant when there has been such a change of conditions in the restricted area or surrounding it that it is no longer possible to secure in a substantial degree the benefits sought to be realized through the” restriction.

The Restatement (Third) of Property: Servitudes § 7.10 (2000) similarly provides:

When a change has taken place since the creation of a servitude that makes it impossible as a practical matter to accomplish the purpose for which the servitude was created, a court may modify the servitude… If modification is not practicable… a court may terminate the servitude.

Both authorities emphasize:

  • The focus on the purpose of the restriction as of its creation; and
  • The question whether those benefits can still be achieved “in a substantial degree.”

2. The “Post-Purchase Only” Approach in Some Courts of Appeals

Before EIS Development, some Texas courts of appeals had limited the changed-conditions inquiry to developments occurring after the current owner took title, reasoning that:

  • A buyer who purchases property with knowledge of substantial changes cannot later complain about those conditions; and
  • Buyers who want freedom from restrictions should negotiate removal of covenants before purchase.

The leading examples cited in the opinion are:

  • Lebo v. Johnson, 349 S.W.2d 744 (Tex. Civ. App.—San Antonio 1961, writ ref’d n.r.e.), holding that owners “cannot claim as changed conditions those that had already taken place” when they acquired their lots.
  • Oldfield v. City of Houston, 15 S.W.3d 219 (Tex. App.—Houston [14th Dist.] 2000, pet. denied), following Lebo to exclude pre-purchase changes from the analysis.

3. The Supreme Court’s New Rule: Measure from Creation, Not Purchase

The Supreme Court squarely rejects the “post-purchase only” limitation. It holds:

“[A] factfinder must consider all changes since creation of a restriction to determine whether the changed-conditions doctrine precludes enforcement of the restriction.”

In adopting this rule, the Court reasons:

  • The doctrine’s focus is obsolescence, not notice.
    • While equities and expectations matter, the core question is whether it remains “possible to secure in a substantial degree the benefits sought to be realized through” the restriction. Cowling, 312 S.W.2d at 945.
    • The Restatement likewise frames the test in terms of “radical change in conditions since creation of the servitude” such that perpetuating it yields no substantial benefit.
    • The point at which a particular owner acquired the property does not change whether the covenant still serves its original purpose.
  • Interpretation of restrictive covenants is anchored at creation.
    • Tarr instructs courts to ascertain “the objective intent of the [restriction’s] drafters” from the “language chosen” at creation.
    • If that original purpose can no longer realistically be achieved, the covenant becomes “obsolete,” and who owns the land now does not alter that reality.

The Court therefore disapproves those appellate decisions that bar consideration of pre-purchase changes and holds that all changes since the restriction was created must be available to the factfinder.

4. Application in This Case and the Remedy

At trial, the court instructed the jury to exclude changes that occurred between creation of the Level 5 Restrictions (in the late 1980s) and Salvador Family Holdings’ acquisition of the land in 2019. That instruction, the Supreme Court holds, is error because it misstates the law.

Quoting Glenn v. Leal, 596 S.W.3d 769, 772 (Tex. 2020), the Court notes that when a jury is instructed on an incorrect legal standard, the usual remedy is a new trial. Accordingly, it reverses the judgment on the changed-conditions counterclaim and remands for a new trial, in which the jury may consider:

  • All changes in the restricted area and its surroundings from the time the Level 5 Restrictions were created (late 1980s) to the present;
  • Evidence regarding:
    • Other subdivisions and developments in the former Super Collider area;
    • Evolution of infrastructure, roads, and municipal growth near Waxahachie;
    • Shifts in the character of the area (e.g., from rural to exurban); and
    • Other relevant context affecting the utility of the restriction in achieving its original goals.

Because the Court already holds that EIS’s 73-lot plan does not violate the covenant as properly interpreted, the changed-conditions claim is now principally relevant to the continuing enforceability of the broader Level 5 Restrictions (e.g., minimum dwelling size, guest-house rules) on this and other properties.

D. Necessary Parties and Rule 39 Joinder

1. Rule 39’s “Claims an Interest” Requirement

Texas Rule of Civil Procedure 39(a)(2) requires joinder of a person who:

  • “claims an interest relating to the subject of the action”; and
  • is so situated that disposing of the action in the person’s absence may impair or impede the person’s ability to protect that interest or subject existing parties to multiple or inconsistent obligations.

The Supreme Court has previously interpreted “claims an interest” to mean that the person must have actually asserted or demanded recognition of the interest, not merely that they could do so:

  • Crawford v. XTO Energy, Inc., 509 S.W.3d 906, 912–14 (Tex. 2017), defined “claim” as “to demand recognition of [a right]” or “to assert or establish a right or privilege,” and held that Rule 39 does not require joinder of persons who potentially could claim an interest but have not actually done so.
  • In re Kappmeyer, 668 S.W.3d 651 (Tex. 2023), applied this rule in a subdivision dispute where some owners challenged amendments to restrictive covenants. The Court held that other subdivision owners—though bound by and benefitted by the covenants—were not necessary parties because they had not taken affirmative steps (e.g., suing, intervening, or objecting) to “claim” an interest in that particular suit.

2. Application to the State and Nonparty Adjoining Owners

EIS moved to abate the case for failure to join:

  • The State of Texas, as grantor and statutory enforcer of restrictions expressed in its transfer documents, see TEX. NAT. RES. CODE § 31.068(a)(2); and
  • Other adjoining landowners who, like the Association’s members, have rights under paragraph 11 of the Level 5 Restrictions to enforce them.

The Court acknowledges that both groups have an interest in the restrictions:

  • The State retains statutory authority to enforce restrictions in its transfer documents.
  • Other adjoining owners have contractual/real-property rights to enforce the Level 5 CCRs.

But the key point is that neither the State nor any nonparty adjoining owners have actually:

  • Filed suit;
  • Intervened;
  • Objected to the Sunset Meadows plat; or
  • Otherwise demanded recognition of their rights in this litigation.

Under Crawford and Kappmeyer, mere possession of an interest (“having”) does not equate to “claiming” an interest. Co-owners, covenant beneficiaries, or original grantors are not automatically necessary parties simply because the outcome might affect them.

The Court further explains that older cases requiring joinder of persons who “have or claim a direct interest” through deeds or leases were decided before the adoption of Rule 39 and are of “limited usefulness” under the current text, which explicitly requires actual claiming.

Accordingly, the Court holds that:

  • Neither the State nor the nonparty adjoining owners are necessary parties under Rule 39(a)(2); and
  • The trial court correctly denied EIS’s plea in abatement seeking their mandatory joinder.

V. Simplifying Key Doctrines and Concepts

1. Restrictive Covenants and “Density” vs. “Lot Size”

A restrictive covenant (or CCR) is a recorded legal promise limiting how property can be used—for example, restricting land to residential use, specifying minimum house size, or limiting the number of residences on a parcel.

  • Lot size restrictions (e.g., “no lots smaller than five acres”) control how land may be subdivided.
  • Density restrictions (e.g., “no more than two residences per lot”) control how many structures may be built on a parcel, regardless of its size.

The phrase “no more than two residences on any five acre tract” is plainly about how many homes can go on a given tract—i.e., density—not about forbidding smaller tracts altogether. The Supreme Court refuses to treat a density rule as if it also contained an unstated lot-size rule.

2. The Omitted-Case Canon

The omitted-case canon is a basic interpretive principle: if a legal text does not address a particular scenario, courts generally treat that scenario as not covered.

In this case:

  • The covenant lists a maximum of “two residences” for “any five acre tract.”
  • It does not say what happens on a tract of, say, 1.8 acres.
  • Because restrictive covenants disfavored by law must give clear notice, courts will not assume smaller tracts are banned from any residential use unless the text clearly says so.

The Court fills in only what is reasonably implied:

  • Two or more residences on a sub‑5‑acre tract are inconsistent with a “two per five acres” density cap; but
  • One residence on a sub‑5‑acre tract is not clearly prohibited and is a natural baseline assumption.

3. The Changed-Conditions Defense

A landowner facing enforcement of a restrictive covenant can invoke changed conditions to argue that the rule has become obsolete. The essential questions are:

  • What was the original purpose of the covenant? (e.g., to keep an area single-family residential, or to maintain low density?)
  • Have conditions in or near the restricted area changed so much since the covenant was created that the original purpose can no longer be achieved to any substantial degree?
  • Would enforcing the covenant now do more harm (by blocking “desirable uses of land”) than good?

This doctrine is equitable, meaning courts weigh fairness and practicality, not just the literal text. EIS Development holds that this inquiry must look at all changes since the covenant’s creation, not just changes after the current owner bought the property.

4. Waiver/Abandonment by Acquiescence

Neighbors may “waive” a restriction or “abandon” it when their conduct shows they are no longer treating the covenant as binding. Examples might include:

  • Knowing about multiple substantial violations (e.g., numerous non-residential uses) and doing nothing for years; or
  • Personally breaching the restriction while still trying to enforce it against others.

But:

  • Failure to pursue futile actions (like asking a city that has no authority over CCRs to deny a plat) is not waiver.
  • Failing to enforce a covenant on land one has no right to regulate (non-adjoining property) is not waiver of rights on land one does adjoin.

5. Necessary Parties Under Rule 39

Not everyone who could be affected by a lawsuit must be joined as a party. Under Rule 39:

  • A person is “necessary” for joinder only if they have claimed an interest (for example, by suing, intervening, or formally objecting).
  • Merely having a legal relationship—such as being another homeowner in the subdivision or the original grantor—is not enough.

EIS Development confirms that:

  • Other owners who share rights under a restrictive covenant; and
  • The original grantor with statutory enforcement rights

are not automatically required parties if they have not actively entered the dispute.

VI. Broader Impact and Future Implications

A. Drafting and Enforcing Density and Lot-Size Restrictions

The decision sends a clear message to drafters of private land-use restrictions—whether governmental entities, developers, or property owners’ associations:

  • If the goal is to preserve large-lot, rural character, the instrument should expressly state:
    • Minimum lot sizes (e.g., “no lot shall be less than five acres”), and/or
    • Global density caps independent of tract boundaries (e.g., “no more than two main residences per five acres of the original 100-acre tract, regardless of how it is subdivided”).
  • Simply limiting “two residences on any five acre tract” is not enough to:
    • Forbid residential use of sub‑5‑acre tracts; or
    • Prevent high overall lot counts achieved through subdivision into many one- to two-acre lots with single homes.

For enforcement litigation, the case reinforces:

  • Courts will not expand incomplete covenants to cover uses they do not clearly address.
  • Arguments based on generalized expectations (“we thought this area would remain low-density”) will not prevail against unambiguous text that does not embody those expectations.

B. Strengthening Textualism in Texas Property Law

The majority’s reasoning continues a line of Texas Supreme Court cases that apply rigorous textualism to property instruments:

  • Tarr permitted short-term rentals where covenants did not clearly forbid them.
  • Cosgrove insisted on strict adherence to statutory and textual requirements in property conveyances.
  • CenterPoint Energy and U.S. Polyco emphasize respect for chosen language and warn against judicially inferred “grand purposes.”

EIS Development fits this pattern by:

  • Applying the omitted-case canon to refuse to supply a missing minimum-lot-size provision; and
  • Rejecting an “intent of the original parties” argument not persuasively rooted in the recorded text.

This textualist trend has practical virtues: it:

  • Promotes predictability and “bright lines” in land transactions;
  • Encourages careful drafting; and
  • Reduces litigation over unstated expectations.

C. Expanded Evidence in Changed-Conditions Litigation

The new rule on changed conditions is likely to have substantial practical impact:

  • Developers and landowners can now introduce a broader historical record of transformation—from the date of covenant creation—to show that a restriction no longer meaningfully serves its original purpose.
  • Homeowners’ associations and neighboring owners may need to prepare to defend covenants by:
    • Demonstrating that the core benefits (e.g., residential-only use, single-family character) remain substantially intact, even if the surrounding area has urbanized; and
    • Explaining why continued enforcement is still equitable and beneficial, not merely technical.

Because the Court disapproves multiple appellate decisions and sets a uniform statewide standard, trial courts will have clearer guidance, but the fact-intensive nature of the doctrine ensures continued litigation on the merits.

D. Limits on Waiver and Necessity of Joinder

The Court’s approach to waiver and joinder also has systemic consequences:

  • Waiver:
    • Owners do not waive enforcement rights by failing to pursue futile remedies or by inaction where they have no legal standing.
    • This protects associations and landowners from being penalized for not engaging in symbolic or jurisdictionally barred actions, such as protesting plats based on private CCRs before city councils that have no power to enforce them.
  • Joinder:
    • Litigants cannot compel joinder of all potential enforcement beneficiaries (other owners, the State, etc.) merely because the judgment might affect them.
    • This prevents covenant disputes from ballooning into unmanageable multi-party litigation and aligns with the Court’s recent Kappmeyer ruling.

E. Rural Character vs. Development Pressures

On a policy level, the case illustrates tension between:

  • Owners who purchased in reliance on a perceived low-density, rural lifestyle; and
  • Developers seeking to meet housing demand through higher lot counts within legal constraints.

The dissent warns that the majority’s approach may invite “those seeking to build high-density subdivisions” to “run roughshod” over such expectations by subdividing. The majority responds that:

  • This particular Level 5 language is not shown to be widely used; and
  • Any broader systemic concerns should be addressed through better drafting of future covenants and possibly through legislative or regulatory means, not through judicial rewriting of existing deeds.

VII. Conclusion

EIS Development II, LLC v. Buena Vista Area Association is a significant addition to Texas property and servitude law in at least two respects.

  • First, it clarifies how to interpret an incomplete density restriction:
    • “No more than two residences may be built on any five acre tract” is a density cap, not a minimum-lot-size rule.
    • The covenant allows one residence on each tract, whatever its size, unless the text clearly says otherwise.
    • Courts will not infer minimum-tract-size limitations or global density caps absent express language.
  • Second, it resets the temporal focus of the changed-conditions doctrine:
    • Factfinders must consider all changes since the restriction’s creation, not just post-purchase developments.
    • The doctrine assesses whether the restriction still serves its original purpose in a meaningful way, not whether a particular owner expected ongoing enforceability.

Along the way, the Court reaffirms stringent textualism in interpreting restrictive covenants, limits waiver to truly inconsistent conduct (not mere inaction in the face of futility or lack of standing), and cabins mandatory joinder to those who actually “claim” an interest in the litigation under Rule 39.

For practitioners, the case underscores the importance of:

  • Drafting precise, unambiguous CCRs that clearly capture desired limits on subdivision and density;
  • Recognizing that recorded text—not unexpressed expectations—controls in property disputes; and
  • Developing a robust historical record when litigating changed-conditions claims, reaching all the way back to covenant creation.

In the immediate dispute, EIS may move forward with building one single-family residence on each of its 73 platted lots, subject to whatever remains of the Level 5 Restrictions after the remanded trial on changed conditions. In the broader legal landscape, the decision will shape how Texas courts, developers, and landowners understand the reach—and the limits—of private land-use controls for years to come.

Case Details

Comments