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Virginia Highland Civic Assoc. Inc. v. Paces Properties Inc.

A bona fide purchaser for value was not charged with notice of unrecorded encumbrances contained in a settlement agreement, merely because an uncodified municipal ordinance and state legislative resolution referenced the agreement.

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The Virginia Highland Civic Association, Inc. VHCA sued Paces Properties, Inc. Paces, and Ponce Partners, LLC. Ponce, for declaratory judgment and injunctive relief. Through a bid submitted by Paces, Ponce purchased acreage from the Georgia Department of Transportation DOT previously intended for use as a right-of-way for a project known as the “Presidential Parkway.” VHCA claims that under an agreement in settlement of litigation which arose from the project, Ponce must obtain its approval for development of the property. VHCA bases this argument on the fact that the agreement became the subject of a Georgia Senate resolution and City of Atlanta ordinance. The superior court disagreed with VHCA’s argument and denied the relief sought. We affirm.

The Presidential Parkway project was a matter of great controversy in the City of Atlanta. In condemnation litigation arising from the project, the controversy was settled by agreement of DOT, the City of Atlanta, and CAUTION, Inc. acting on behalf of itself and its constituent neighborhood organizations, which included VHCA. The settlement agreement, entered in 1992, set forth a plan for disposition of DOT-owned rights-of-way not needed for the construction project. It was agreed that various of the rights-of-way, including one consisting of approximately 4.4 acres on the north side of Ponce de Leon Avenue in the vicinity of Barnett Street the Ponce/Barnett right-of-way, would be “disposed of by sale” and “used in a manner agreed to by the City and the VHCA.”

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