Korn v. Campbell , 104 N.Y.S. 462 ( 1907 )

Lambert, J.

(dissenting):

The defendant in this action is the owner of certain premises at the northwest corner of Madison avenue and Seventy-third street, in the city of New York. There is a dwelling house lipón such premises, and the defendanfclias filed plans with the building department under which it is proposed to transform this residence into a store, with offices overhead. The plaintiff is the owner of a house and lot between'. Seventy-third and Seventy-fourth streets on the westerly side of Madison avenue, adjoining the rear of defendant’s lot, and the latter has succeeded in his action for an injunction restraining the defendant from thus changing the residence into a business place. Both parties derive title from one James Lenox, who, on the 10th of August, 1870, conveyed a plot of land, including the.premises of the plaintiff, and defendant (and having a frontage on Seventy-third street of 195 feet and a depth along Madison avenue of 102 feet and 2 inches), to one William Lalor. This deed contained the following covenant:

“ The said party, of the second part (Lalor), for himself, his heirs, executors, administrators and assigns, doth covenant, promise and agree to arid with the said party of the first part (Lenox), his heirs and assigns, that he will not at. any time hereafter erect, make, establish or carry on or suffer to be erected, made, established or carried on in any manner or any part of the above described and hereby granted premises, any livery stable, railroad depot, slaughter house, tallow, chandlery, steam engine, smith’s shop, forge, furnace, brass foundry, nail or other iron factory, or any manufactory for the making of glass, glue, varnish or vitriol, ink or turpentine, or for the tan-' ning, dressing or preparing or keeping of skins, hides or leather, or theatre, opera house, brewery, distillery, molasses or sugar refinery, lager 'beer or concert saloon,, or any manufactory, trade or business whatsoever which may be in anywise noxious or offensive to the neighboring inhabitants, but will use or suffer the said premises to-be used for the erection of first-class private residences only.”

. The court in the equity term granted, a permanent injunction. The defendant appeals.

The presumption here, as in every other case, where a restriction is inserted in a deed against undesirable structures or trades, is that the 'insertion was for the purpose of protecting rights which the. grantor had in adjacent property. (Post v. Weil, 115 N. Y. 361, 372.) The grantee, by accepting the deéd containing this restriction, assumed an obligation to devote the premises.within the limitations prescribed,, and' this agreement was enfórcible by any inter-" est entitled to invoke its protection. (Post v. Weil, supra.) It is conceded on the part of the appellant that the premises conveyed by Lenox to Lalor were obviously “ intended to be cut up into lots,” and this is manifest .by the fact that the covenant was. that the grantee would “ use or suffer" the said premised to be used" for tlie erection of first-class qjrivate residences only,” and' this' was the use "which was-actnally made of the premises, á number-of houses having'been subsequently erected upon the: premises described, each of eleven lefts'being separately mortgaged for the- purpose of carrying out the project. Of course, it is reasonable to assume that the party purchasing the property under such restrictions gives less for it than he would have given if he had bought it unincumbered.

“ Can there, then, be anything much more inequitable or contrary " to good conscience,” to quote the language of Chancellor Cottenham, in Tulk v. Moxhay (1 Hall & Tw. 105, cited with approval in Hodge v. Sloan, 107 N. Y, 244,252), “ than that a party who takes property at a less price because it is .subject to a restriction, should receive the full value fi;om a third party, and that such third party should then hold it unfettered hv the restriction under which.it is granted ? ” Obviously, such is not the law, and the appellant concedes that so far as Lenox, the original grantor, is concerned, he or his heirs is entitled to have this covenant enforced; but it is urged that as the grantor sold the entire parcel, and has no further interest in the same, that as between, the present owners of the subdivisions there is no right to injunctive relief.

William Lalor and wife conveyed to one James H. Coleman an undivided one-third interest in the premises conveyed to Lalor, and in the deed from Lalor and his wife to Coleman there was. no mention of these restrictions,.but there was no partition of the premises, so 'that Coleman merely became' the .owner of an undivided one-third, all.of the premises being subject to the restrictive covenant. On the 1st day of July, 1871, the said William Lalor and James H. Coleman, and their respective wives, conveyed the whole of the said plot of ground to one James' E. Coburn by full covenant and warranty deed conveying' the property subject to certain specified mortgages, and containing the following words, viz.: “ Subject to the covenants, conditions' and restrictions against nuisances and buildings contained in deed of James Lenox of the above described premises.” “ The language of courts and' jukges has been very uniform and very decided upon this subject, and all agree that whoever purchases lands "upon which the owner has imposed an easement of any kind, or created a charge which would be enforced in equity against him, takes the title-subject to all easements, equities and charges however created, of which hé has notice.” (Holt v. Fleischman, 75 App. Div. 593, 599.) It is very certain that Coburn, by accepting this deed, “.subject to the covenants,” etc., contained in the Lenox deed, had notice of the existence of thg restriction, and took-no higher title than Lalor took from Lenox. Even were it not a covenant running with the land, hut a-simple contract only, ■ the grantee having record notice, is bound by it. (Spencer v. Stevens 18 Misc. Rep. 112. 113; Round Lake Assn. v. Kellogg, 141 N. Y. 348, 355.)

It seems clear, then, that the property came into-'the ownership of Coburn in exactly the same condition that it passed to Lalor from Lenox. Coburn, to raise money to complete his purchase, subdivided the premises into eleven lots, and mortgaged each by a separate • mortgage to the Xorth American Life Insurance Company, so that -the lots now oivned by the plaintiff and defendant, respectively, were covered by distinct mortgages. Xeither of these mortgages contained any reference to the restrictive covenant in the original deed. However, as Coburn could'get. no higher title, than that which Lalor held, he could not enlarge his ownership in the premises by merely omitting a reference to this restriction, which was contained'in the deed from which the title descended, and was, therefore, record notice to all who became interested in the ,premises. These two mortgages appear to have remained unpaid and. unf'oreclosed until the year 1879, when they were both foreclosed. Thé lot now owned -by the plaintiff was sold by the referee in foreclosure to - one Mary A. Moore, who at the time was the.owner.of the -equity of redemption, and the deed to her followed the language Of the mortgage, containing no reference to the restrictive clause. The lot now owned by the defendant was sold by the referee to .the Ai-temas H. Holmes, who was the then- owner of the equity of redemption, and the deed was in substance the same as that under which the'plaintiff’s predecessor took title. JBy mesne.conveyances from Mr. Holmes, who was the purchaser of the defendant’s property, the title passed to one Jacob Tallman. in the year 1887. Xeither' the. deed from Mr. Ilohnes, nor any of the' intermediate deeds down to the one which conveyed to Tallman, -contained any reference to the Lenox restrictions, but when. Tallman came to take ' ■ his warranty deed, it was made .“ subject to the covenant against nuisances and as to buildings contained in a certain deed made' by • James Lenox to. William Lalor, dated the 10th day of August, 1870, and recorded in the office of the register aforesaid/’ etc. - The defendant takes by mesne conveyances from Tallman, no further mention of the restrictive covenant appearing in any of the intermediate conveyances. The plaintiff’s title is. derived by deed from Mrs. Moore by full covenant warranty deed, containing no reference to the.restrictive covenant.

It appears that while the entire plot was -in the possession of Coburn eleven private residences were constructed upon the premises, and that they have been occupied as such private residences down to the present time, except that three of the original houses . have been torn down-and- replaced by superior structures, still conforming to the requirements of the restrictive covenant in the original deed. This is a practical construction of the deed; every purchaser must be deemed to have purchased with reference to the condition as it existed at the time of the transaction, and at all tiines both the plaintiff and defendant had notice of the fact that this was a residential block, and the deed from which they derive title, and which was duly recorded, told them at all times that only buildings of a like character could be erected upon any of these eleven lots. Each must be presumed, therefore, to have purchased only the right to erect and. maintain a first-class private residence upon his lot, and as ho one of them could gain any higher fight, each one'of them has an equitable right to insist that no one of them shall disregard the conditions.. Lenox, in selling the premises in 1810, exacted, as.lie had a right to do, a covenant restricting the use of the premises. It is conceded that it was contemplated that the property should be cut up into building lots for private residences, and this purpose was fully carried out,- and in the contemplation of equity every purchaser of one of these lots thus limited took the right to enforce the same restriction against his neighbor. It does not do to say that it was a right reserved alone to the original grantor, for this would make the rights of purchasers in good faith to depend upon the mere caprice of Lenox. . One might be permitted to do any of the prohibited things, while all the others might be deprived of the beneficial use ,of their property by reason of such acts. ■ As we have already indicated, the, law presumes that such restrictions are made fdr the benefit of the grantor’s adjacent property, and from all that appears in the record, Lenox may own all of-the property in that neighborhood outside of the block, or he may have owned the same.at tlie’ time of making the deed, and by subsequent conveyance's may have ceased' to have any interest In the enforcement of the covenant, but that is no reason why one who has in good faith purchased and maintained a first-class private residence should be deprived of the right to insist that his neighbor, who has no higher right, should be bound by the same covenant.

There is no evidence in this case which would'warrant the' conclusion that the character of the locality had so changed'as to make it ’-inequitable to enforce this covenant against the defendant; the plainly avowed purpose of the change is -to enable the defendant to secure "higher rentals for a business house than she can secure in its present form; and thus to get what neither she nor any of her. predecessors in title from Lenox ever bargained and paid for. We think, as against the plaintiff in this action, she has no such right, and that the judgment of the court at Special Term is in harmony with the'; authorities controlling within' this jurisdiction.

Tlie judgment appealed from should be affirmed, with costs.

Patterson, P. J., concurred.

Judgment reversed and complaint dismissed* with costs to appellant in this court and in the court below, . '-