Is a Kid’s Lemonade Stand a Prohibited Commercial Activity?

Post by David Swedelson, Partner, SwedelsonGottlieb

We are often asked to assist California community associations dealing with unauthorized homeowner commercial activities when prohibited by the association’s governing documents. Usually, the issue is whether the commercial activity will or is impairing the residential character of the community.

So, for example, we have been called upon to deal with a hair stylist, an employment headhunter, a psychologist, and other service-oriented businesses that had a number of clients and/or employees coming into a gated community or locked building. Once, we dealt with a refrigerator repair service where customers were coming into the association to drop off or pick up their refrigerator. Another time, it was an auto repair business being run out of a garage. And of course, lately we have been dealing with more then one marijuana growing facility. You get the picture.

But a lemonade stand? Heck, I remember having one of these in front of my house growing up, but I did not live in a community association, at least not then.

But consider the community in Palm Beach County, Florida that forced the closure of a lemonade stand that was being operated by neighborhood children. Here is the video of the news story that aired on television:

There is no question that the restrictions in any community association’s CC&Rs are an important part of community association living. Many owners choose to move into a particular association based in part on the restrictions, and they expect their association to enforce them. Owners do not want to see a car repair service, a burger stand or some other purely commercial activity taking place in front of or out of a home in their community of homes or condos, especially when that business will impair the residential character of the community.

But what about a lemonade stand? How about the sale of Girl Scout cookies? Is the lemonade stand really going to set a precedent? I don’t think so.

What do you think? Did this Florida community go too far?
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