The Nebraska ruling that an HOA may not be able to enforce its own covenants is now final
The Nebraska ruling that an HOA may not be able to enforce its own covenants is now final
2026-09-12 · Nebraska · Courts
A Nebraska homeowners association sued to shut down a neighbour's licensed in-home daycare, and the Court of Appeals never reached the question — because the association had no right to bring the suit at all. The Nebraska Supreme Court denied further review on January 15, 2025, which makes Hillsborough Homeowners Assn. v. Karnish final.1
Get the date right
Before the substance: this decision was issued on October 8, 2024, published at 33 Neb. App. 228. Several search summaries circulating online date it to 2026 or attribute it to the Nebraska Supreme Court. Both are wrong. The Court of Appeals decided it in 2024; the only 2025 event is the denial of the petition for further review, and that denial is what settles it.2
What the covenant said, and who could enforce it
The Karnishes ran a licensed daycare from their home. The declaration provided that “[n]o business activities of any kind whatsoever shall be conducted on any lot.” The district court found the association had waived the restriction.
The Court of Appeals affirmed on an entirely different ground and dismissed the appeal for lack of jurisdiction, holding the association lacked standing:
“Based on the plain language of the covenants, only the declarant and lot owners have the right to enforce a covenant by a proceeding at law or in equity… There is nothing in the Declaration of Covenants to indicate that the Association is a lot owner.”2
“As such, the authority to enforce the covenants remains with the original declarant or lot owners, and the Association has failed to provide evidence of its standing to bring this claim against the Karnishes.”2
Why this is a Nebraska problem specifically
In states with a comprehensive planned-community act, a statute typically grants the association power to institute litigation in its own name on matters affecting the community, whatever the declaration says. Nebraska has no such statute for non-condominium associations. The Nebraska Condominium Act governs condominiums created on or after January 1, 1984; the older Condominium Property Act governs those created before. Neither reaches a planned community that is not a condominium.
For those associations — the large majority of Nebraska HOAs — enforcement authority comes from one place: the recorded declaration. If the declaration's enforcement clause names the declarant and the lot owners and stops there, the association is not on the list, and being the entity that collects the assessments and holds the meetings does not put it there.
The audit this decision requires
Every Nebraska board has had time to do this, and most have not.
Read the enforcement clause, not the summary. Find the provision in the declaration that says who may enforce. Note exactly which parties it names. The common formulations are the declarant alone; the declarant and any owner; the association and any owner; or a general “any party aggrieved.” Only the wording matters.
If the association is not named, do not file in the association's name. An owner who is a lot owner has standing under a clause of that kind. The association organising, funding and directing a suit brought by willing owners is a different posture from the association suing, and it is available where the association's own standing is not.
Check whether the association owns a lot. The court's reasoning turned partly on there being nothing to indicate the association was a lot owner. An association that owns common ground described as a lot on the plat may be in a different position — a fact question worth establishing before it is contested, not after.
Consider amending the declaration. Adding the association to the enforcement clause is an amendment, governed by the declaration's own amendment provision and its required owner percentage. It is slow and it is the only durable fix.
The waiver point that got away
Worth noting for what it is: the district court had found waiver, and the Court of Appeals never reviewed that finding, because it disposed of the appeal on standing. So Karnish is not authority on whether tolerating home-based businesses waives a no-business covenant in Nebraska. That question remains open, and an association that has looked away from home offices, hair salons and online resellers for years should not read this case as reassurance about it.
What to watch next
Watch how often this argument is raised. A standing defence keyed to the declaration's enforcement clause is cheap for a defendant to make and fatal when it lands, and it is now a published Court of Appeals holding that survived further review. Any Nebraska owner facing covenant enforcement will have counsel who can find it.
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