Mygatt v. . Coe , 124 N.Y. 212 ( 1891 )

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.]

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] Mrs. Fisher, had she been evicted and brought her action in the life-time of Mrs. Coe, could have recovered her damages of this defendant, because he had covenanted directly with her, under his seal, that he would indemnify her for the damages sustained by an eviction. Though Mrs. Coe died before this action was begun, the question of the liability of a surviving joint contractor (Risley v. Brown, 67 N.Y. 160; Randall v. Sackett, 77 id. 480) is not raised by the record, and it was conceded on the argument in this court that it does not appear whether the defendant received the whole or any part of the consideration of the deed. Mrs. Coe having no title when she conveyed to Mrs. Fisher, the covenants of seizin and of right to convey were broken by the delivery of her deed and became choses in action, which were not transferred to the subsequent grantees, or, in other words, these covenants did not run with the land. (Greenby v. Wilcocks, 2 Johns. 1; Abbott v. Allen, 14 id. 248; M'Carty v. Leggett, 3 Hill, 134; Mott v. Palmer,1 N.Y. 564; Chapman v. Holmes, 10 N.J.L. 20; 2 Dart's Vend. [6th ed.] 881; Rawle Cov. [5th ed.] §§ 69, 202.) The plaintiffs must recover, if at all, for a breach of the covenants of warranty and of quiet enjoyment.

The important question in this case is, whether covenants of warranty and of quiet enjoyment entered into jointly by the owner of the fee, or one assuming to be its owner, and a stranger to the title, run with the land as against the stranger, and are available in favor of a subsequent grantee who holds no assignment of the cause of action arising from the breach.

Had the plaintiffs been able to allege and prove a deed in which the defendant and his wife had assumed to grant, and had they delivered possession of the premises described and had covenanted that they were lawfully seized, had good right to convey, and that they would forever warrant and defend, the plaintiffs might, by the aid of the doctrine of estoppel, have prevented this defendant from proving, and the court from finding, that he never had any title, estate or interest in the land. But the parties agreed, and the court found that Roberts assumed to convey the premises to Almira S. Coe. The plaintiffs alleged, which the defendant did not deny, and proved that the defendant and his wife covenanted that she was lawfully seized of an absolute and indefeasible estate of inheritance, in fee simple, in the premises and had good right and lawful authority to convey them. Our attention is called to the finding that the defendant and his wife joined in a deed purporting to convey the land in fee simple to Nancy Fisher. This finding is not inconsistent with the findings and facts admitted already referred to. It is not therein found that this defendant assumed to convey any estate in the premises, nor is it found that he covenanted that he or they were seized and had a right to convey the premises, nor can we infer such a fact in the face of the allegation in the complaint that Mrs. Coe assumed to have the entire title to the premises, and, in legal effect, that the defendant was a stranger to it. Facts admitted by the pleadings have the same force as facts found. If the facts found and admitted are inconsistent, the appellant is entitled to rely upon those most favorable to him. It is unfortunate that the deed which fixes the rights of these parties is not contained in the case, but if a new trial is had this defect will be remedied, and the exact connection of this defendant with the conveyance will be made clear.

"There are three manner of privities, viz.: (1.) Privity in case of estate only. (2.) Privity in respect to contract only. (3.) Privity in respect to estate and contract together." (2 Sugd. Vend. [*]714; 4 Cruise's Dig. [*]376; Greenleaf's ed. 458.) The term privity in estate denotes mutual or successive relationship to the same rights of property. (Stacy v.Thrasher, 6 How. [U.S.] 44-59; Green. Ev. §§ 189, 523; Big. Est. [6th ed.] 347.) "There is a certain privity between the grantor and grantee of the land. It is not the privity arising upon tenure, for there is no fiction of fealty annexed. It is, however, the same sort of privity which enables the grantee of a purchaser to maintain an action upon the covenants of title given to his vendor; and it is moreover a privity of the same nature with that which obtains between the grantor and grantee of terms for life and for years." (Van Rensselaer v. Hays, 19 N.Y. 68,91.)

There was no mutual relationship between the defendant and Nancy Fisher or her grantees, nor was there any successive relationship between him and Nancy Fisher or her grantees.

It is not necessary that privity of estate, within the meaning of the feudal law — mutuality — should exist between the covenantor and the covenantee or his successors in interest to carry a covenant of warranty to subsequent grantees. (VanRensselaer v. Read, 26 N.Y. 558, 574, 575.) But unless there is either mutuality or succession of interest, this covenant will not run with the land. In this state privity of estate, within the meaning of the law of tenure, seldom arises, except between lessor and the successors of his lessee, or when the covenantor retains a reversionary interest in the land conveyed.

Under the facts found there was no privity of estate, actual or assumed, between the defendant (the covenantor) and Nancy Fisher (the covenantee), only privity by contract. The defendant having no estate, title or interest in or possession of the land conveyed, there could be no privity in estate between him and Nancy Fisher, and not having covenanted or represented that he had an estate, he cannot be estopped from showing that he had none. The only privity which existed between the defendant and Nancy Fisher was by contract, which is insufficient to carry the benefit to subsequent owners of the property to which the covenants relate.

In Slater v. Rawson (1 Met. 450), the defendant assumed to convey one hundred and thirty acres of land by a deed containing covenants of seizin and warranty. The plaintiff succeeded to the estate of the defendant's grantee through several mesne conveyances, but was evicted from twenty-two acres under a title which was paramount to that of the defendant. In an action to recover damages for the breach of the covenants, it was held that it appearing that the defendant had neither title nor possession his covenant of warranty did not attach to the land and run with it to subsequent grantees, and that the plaintiff could not recover. Upon the retrial the jury found that the defendant was in and delivered possession of the land when he conveyed, and it was held (6 Met. 439) that seizin was a sufficient estate to attach the covenant to the land and carry it to subsequent grantees, who could sustain an action for its breach. This rule is recognized in other cases. (Fowler v.Poling, 2 Barb. 300; 6 id. 165; Beddoe v. Wadsworth, 21 Wend. 120; Moore v. Merrill, 17 N.H. 75.)

In Nesbit v. Nesbit (1 Taylor [N.C.] 82, reconsidered and affirmed, Conf. Reports, 318), one Cranston conveyed land to Mary Montgomery, then under age, who afterwards became the wife of Arthur Newman, the consideration for the conveyance being paid by Hugh Montgomery, the father of Mary. Some years after, Hugh Montgomery, in consideration of sixty pounds, paid to him for the use of his daughter, conveyed the premises to one McConnell, covenanting for quiet enjoyment and for further assurance, to be executed by Mary when she should become of age. McConnell afterwards conveyed one-half of the land to the plaintiff, who, being evicted by Mary Newman (formerly Mary Montgomery), sued Montgomery's executors. A verdict was rendered for the plaintiff, but a motion to arrest the judgment was made, on the ground that the covenants in the deed from Hugh Montgomery to McConnell were covenants in gross, and did not run with the land to McConnell's grantee. TAYLOR, J., in speaking for the court, said: "From the whole of this case it may be laid down as a rule, without any exception, that a covenant to run with the land and bind the assignee must respect the thing granted or demised, and that the act covenanted to be done or omitted must concern the lands or estate conveyed. But when it appears upon the face of the declaration that the defendant's testator, who sold this lot, neither had nor pretended to have any title to it, that, on the contrary, Mary, his daughter, had the complete seizin under the deed from Cranston; that the testator having conveyed no title to McConnell, the plaintiff could, consequently, derive none from him; it may be asked, what is there to create any privity between these parties? The maximtransit terra cum onere presupposes a transfer of the land, and when that actually takes place, it forms the medium of a privity between the assignees. Unless, therefore, we make a presumption against the plain statement in the declaration, the title of this lot never ceased to be in the daughter, Mary, from the time Cranston conveyed to her. Suppose the father and mother had entered into the covenants contained in the deed, by a separate instrument, unaccompanied with any conveyance of the land, no one would pretend that an assignee should take the benefit of such a contract. Then, can the case be materially altered by annexing these covenants to a deed of bargain and sale, which, being a conveyance under the statute of uses, transfers only what the bargainor might rightfully convey? For the declaration shows that rightfully he could convey nothing. If one man covenants that another shall quietly enjoy or obtain a conveyance for an estate which is owned by a third, this binds the covenantor and his executors or administrators to the covenantee, but cannot extend to the assignees of the latter. Nor can I conceive that the law is different where a man sells an estate and makes the same covenants, provided it appears upon the declaration that he had no right. In both cases the privity is wanting which forms the basis of reciprocal remedies to the parties."

Webb v. Russell (3 Term, 393), arose out of the following facts: William Stokes being possessed of a term having some eighty years to run, mortgaged it to Richmond Webb as security for the payment of a debt. At this time, by the law of England, the entire legal estate of the mortgaged premises vested in the mortgagee. October 26, 1780, George Russell leased the premises for eleven years, from Stokes and Webb, and agreed to pay toStokes, the owner of the equity of redemption, or to his assigns, the annual rent of two hundred pounds and to keep the premises in repair. In 1781, Sarah Webb, the plaintiff, acquired the estate of the mortgagor and mortgagee, and brought an action against Russell for the recovery of rent due and for damages for breaking the covenant to repair. The defendant demurred to the declaration. It was held, Lord KENYON speaking for the court: "I cannot conceive how this covenant made with Stokes can be said to run with the land; for Stokes is stated in the declaration to have no interest whatever in the the land, and yet both the implied covenant arising from the yielding and paying, and also the express covenants are entered into with Stokes. It is not sufficient that a covenant is concerning the land, but in order to make it run with the land there must be a privity of estate between the covenanting parties. But here Stokes had no interest in the land of which a court of law could take notice; though he had an equity of redemption, an interest which a court of equity would take notice of. These, therefore, were collateral covenants. And though a party may covenant with a stranger to pay a certain rent in consideration of a benefit to be derived under a third person, yet such a covenant cannot run with the land." Subsequently Stokes sued Russell for the rent and for the breach of the covenant to repair. The facts above stated were pleaded as a defense; and thereupon the plaintiff demurred to the pleas in bar, and judgment was rendered for the plaintiff. Lord KENYON, again delivering the opinion of the court, held that the covenants were covenants in gross, and that the plaintiff could maintain the action. Errors were assigned and the judgment was reviewed in the Exchequer Chamber, where it was affirmed (1 Black. 563). Lord LOUGHBOROUGH, speaking for the court, said: "The term in this case took effect out of the estate of Webb; the covenant with Stokes could not be incident to the estate, nor run with the land; it must be a covenant in gross, and consequently not assignable."

In Keppell v. Bailey (2 M. K. 517), many of the previous cases relating to covenants running with the land were analyzed and reviewed by Lord Chancellor BROUGHAM, and among them Webb v. Russell, which was approved, and it was again directly held that a covenant between a covenantor and a covenantee, between whom there was no privity in estate, does not run with the land. (Pages 543, 546.)

Cole v. Hughes (54 N.Y. 444), arose out of the following facts: Voorhies and Dean being adjoining owners, Dean erected a party-wall, one-half on the land of each, under a contract, which was recorded, by which Voorhies covenanted that whenever he, or his heirs or assigns, used the wall, he or they would pay Dean or his assigns the value of the part so used. Voorhies' lot passed by mesne conveyances to the defendant Hughes, who built on the lot and used the party-wall. Dean assigned the contract to the plaintiff, but conveyed the lot to another. In an action brought by the assignee of the contract it was held: (1.) That the covenant to Dean did not run with his land, and that the right to recover on the covenant belonged to the plaintiff, the assignee of the covenant, and not to the grantee of the lot. (2.) That Voorhies' covenant to pay for the value of the wall did not run with his lot, and that there being no privity of estate between Voorhies and Dean, only a privity by contract, that the covenant did not run with Voorhies' lot. The learned judge said in conclusion: "I am of opinion, therefore, that neither the benefits nor the burdens run with the land." The opinion does not proceed upon the theory that the nature of the covenant was such that it could not run with the land; but on the theory that there being no privity of estate between the covenantor and covenantee, only a privity by contract, that neither the benefits nor burdens of such covenants run with the land to which they relate. Mr. Washburn in his learned treatise upon the law of real property, says (2 Washb. R.P. [*]15 [5th ed.] 296): "16. It has also been attempted to maintain the doctrine, that although the burden of a covenant to pay rent may not be imposed upon land in favor of a stranger so as to run with it, and bind an assignee of the land, a stranger may covenant with the land-owner in such a manner as to attach the benefit of the covenant to the land, and have it run with it in favor of whoever may become the owner thereof. It is not pretended that this can be done, except where the covenant is to do some act for the benefit of the estate upon the land itself. The doctrine above stated is advocated by the editor of the American editon of Smith's Leading Cases, is favored by the English Commissioners upon Real Property, and is assumed to be the law in the cases cited below. To sustain it reference is also made toPackenham's case, commonly known as the Prior and Convent case, and to Coke's opinion.

"But it is believed that the point has never been determined in this way by a full court, though assumed by individual judges, and that, respectable as these opinions in its favor may be, the doctrine contended for is opposed to well-settled principles as well as the highest authority. With a very few exceptions, the uniform current of authorities, from the time of Webb v.Russell to the present day, requires a privity of estate to give one man a right to sue another upon a covenant where there is no privity of contract between them; and, consequently, that where one who makes a covenant with another in respect to land, neither parts with nor receives any title or interest in the land, at the same time with and as a part of making the covenant, it is, at best, a mere personal one, which neither binds his assignee, nor enures to the benefit of the assignee of the covenantee, so as to enable the latter to maintain an action in his own name for a breach thereof."

KENT states the rule in this language: "The distinction between the covenants that are in gross and covenants that run with the land (and which are covenants real, annexed to or connected with the estate, are beneficial to the owner of it, and to him only) would seem to rest principally on this ground that, to make a covenant run with the land, there must be a subsisting privityof estate between the covenanting parties." (4 Kent's Com. 473.)

Lord ST. LEONARDS discusses this question at considerable length, and reaches the conclusion that the covenant of a stranger to a title does not run with the land. (2 Sugd. on Vend. [*]716, 718, 719, 721 [7th Am. ed.] 168, 170, 171, 173, pp. 25, 26, 33-35, 38; See Platt on Cov. 461; Chitty on Con. [12 ed.] 51; 1 Taylor's L. T. [8 ed.] § 261.)

In Hurd v. Curtis (1) Pick. 459), the owners of four mills, which were supplied with water by the same dam, entered into an indenture by which they covenanted for themselves, their heirs, administrators and assigns, to and with each other, their heirs, administrators and assigns, that they would use wheels of a certain construction and limited power in their respective mills. The plaintiff was a party to the indenture and owned an undivided half of one of the mills, and subsequently he acquired the other half. Later the defendants purchased of two of the covenantors their mills, and thereafter used wheels of a different construction and of greater power than those specified in the indenture. In an action brought to recover damages for this breach of the covenant, it was held that there being no privity of contract between the plaintiff and defendants that the defendants were not liable unless there was a privity of estate between them. In discussing this question it was said: "To make a defendant liable to an action of covenant there must be a privity between him and the plaintiff. (Bally v. Wells, 3 Wils. 29.) As there is no privity of contract between the plaintiff and the defendants, it follows that the defendants are not liable in this action, unless there is a privity of estate between them. Where such a privity exists between the covenantor and the covenantee, and the covenantor assigns his estate, the privity thereby created between the assignee and the other contracting party renders the former liable on all such covenants as regulate the mode of occupying the estate, and the like covenants concerning the same. And so if the covenantee assigns his estate, hisassignee will have the benefit of similar covenants. Thesecovenants are annexed to the land and run with it. But if thereis no privity of estate between the contracting parties, theassignee will not be bound by, nor have the benefit of anycovenants between the contracting parties, although they mayrelate to the land he takes by assignment or purchase from one ofthe parties to the contract. In such a case the covenants are personal and arecollateral to the land."

Opposed to these authorities are the remarks of the learned American editor of the eighth edition of Smith's Leading Cases, page 192; Dickinson v. Hoomes' Administrator, 8 Grat. 406. Judge HARE, in his learned note to Spencer's case, in the edition of Smith's Leading Cases last referred to, said: "It appears, therefore, to be an exploded idea that privity of estate or tenure is necessary between the covenanting parties in order that covenants may run with the land."

Dickinson v. Hoomes' Administrator (8 Grat. 353), arose out of the following facts: A father devised to every one of his five children a piece of land, subject to the limitation that if any one died without issue his piece should be divided equally between the survivors or their representatives according to the principles of the law of descents. The five children survived their father, and entered on their several pieces of land. One of them, John, conveyed his land and the other four children joined in the deed, which contained a covenant of warranty. This land passed by several mesne conveyances to Dickinson, the plaintiff. Richard, one of the children and covenantors, died, in the lifetime of John, leaving several children, and afterwards John died without issue, and thereupon Richard's children evicted Dickinson, claiming, not by descent from their father, but under the devise of their grandfather. An action was brought on the covenant of Richard against his representatives; and it was held that when Richard joined in the deed "he had, in fact, an interest in the subject; an interest which depended on the double contingency of John's dying without issue living at his death, and of Richard's surviving him." (Page 402.) In considering the question whether it is necessary that some estate should pass from a grantor to a grantee, to carry a grantor's covenant of warranty to subsequent grantees, the learned judge discussedPrior's and Spencer's cases, and held, in accordance with the rule generally adopted in this country, that it was not necessary that an estate should pass. But in discussing this question the court indulged in the following reflections, which were quite unnecessary for the determination of the case, which had been well decided on the first ground stated: "I can see no reason why these covenants, if in their nature they are such as can run with the land, should not run with the land as well as when they are made by a stranger as when they are made by the donor; but I can see many reasons for the contrary. A person may be willing to purchase land, notwithstanding a flaw in the title, if he can fortify it by proper covenants. The owner may not be sufficiently responsible, but may be able to procure the assistance of responsible friends, or creditors, or others may have sufficient interest to join him in the covenants. But what would these covenants be worth if they could not be enforced by an assignee of the land? A covenant of seizin, or of right to convey, would never be given in such a case, because it would be known to the parties that as soon as made, it would be ipso facto broken. A covenant of warranty, or for quiet enjoyment, would be the most appropriate covenant for such a case; and yet, to make that covenant effectual, it would be necessary, according to the doctrine contended for, that the covenantee should always retain the property. I am, therefore, of opinion that the covenant of Richard Hoomes runs with the land, even though he should be considered as a stranger to the land." (Page 404.)

In Lydick v. The Baltimore and Ohio Railroad Company (17 West Va. 427) the court refers to the conflicting views on the question as to whether the covenant of a stranger runs with the land, and says: "It is not necessary in this case to determine which of these views is sound. For, in the case before us, the requisite privity of estate exists according to the views of Washburn, who holds such privity to be necessary." It will be observed that in this case there had been no grant of any kind to the railroad, simply an oral contract for a right of way, which, had it been granted, would have left the reversion in the owner, and would have created a privity of estate according to the strict rule prevailing when land was held by feudal tenure.

The views of Judge HARE and of the court in Dickinson v.Hoomes have been the occasion of some discussion. A writer in the American Law Register ([N.S.] vol. 2, p. 201) says: "The following topic must be kept distinct from one shortly to be considered, namely, what amount of estate must pass to support the covenants when the covenantee's only title is derived from the covenantor. It is conceded that, in order for covenants in general to run with the land, there must exist a privity ofestate between the parties. (3 Wilson, 29; 3 T.R. 402; 2 East, 380; 17 Wend. 136.) But eminent legal writers have thought this not to be requisite in covenants for title; nor, indeed, in any covenants intended to benefit the estate of the covenantee. (Hare's Note to Spencer's case; Rawle on Cov. 335; 2 Lomax's Dig. 260; 3d Real Prop.; Rep. of Eng. Commissioners.) This opinion has been founded almost exclusively upon the authority of an ancient case, known as the Prior's case (Y.B. 42, Ed. III, 3), cited by Lord COKE. In controverting this view, Sir Edward Sugden, now Lord ST. LEONARDS (Sugd. on Vend. Pur. 472), has subjected the Prior's case to a most searching criticism, which results in its complete overthrow as authority on this question, showing that the portions of it particularly relied on were not judicial resolutions, but an addition by the reporter; that the case does not contain the doctrine usually extracted from it, and that it has received no confirmation, but the contrary, from subsequent adjudications.

"It may be safely laid down, that if the doctrine that the covenants for title will run with the land, even when entered into by a stranger to the land, has no better foundation than the authority of this case, it cannot be sustained; and it would seem to be the better opinion, that in order for a covenantor's covenants to run with the land, he must also be a grantor of the land which they affect. No modern case decides that a stranger's covenants may run with the land; but in a dictum of MONCURE, J., in the recent case of Dickinson v. Hoomes'Administrator (8 Grattan, 406), this doctrine is broadly enunciated. The dictum is based, however, on the Prior's case, and authors who have followed it. It is there said that a purchaser of land who suspects an infirmity of title, and doubts the responsibility of the vendor, may fortify the title by covenants of the grantor's friends, or other interested parties, and these covenants will run with the land to future assignees. This notion is possibly correct, and, if so, highly important, but is not, we apprehend, in accordance with the common understanding among the members of the legal profession. (7 Jarman's Bythewood, 572.) The introduction of such covenants into conveyances would be a novelty, and probably of doubtful expediency. At least it would not be prudent to rely on such covenants until further adjudications have more fully determined their value."

In the American Law Review (vol. 20, 404), Judge HARE'S note is discussed, and the writer, in conclusion, says: "But the authority of Packinham's case seems to be overthrown by the investigations of Sugden and Washburn, who produce unquestionable proof that the case was not decided by the court, as reported by Lord COKE, but that Lord COKE'S report was the expression of a mere dictum by Finchden. This case, then, being authority no longer, the foundation is destroyed of the proposition that even strangers, covenanting to annex a benefit to the land, may be held liable in the suit by the assignees of the tenant with whom the covenant was made. The doctrine, therefore, advanced by the learned annotator of Spencer's case, that even strangers may be bound by covenants benefiting the land, is unsound."

The editor of the ninth American edition of Smith's Leading Cases (vol. 1, 211) takes a different view of this question from the one taken in the earlier editions. He says:

"It seems that there must be between covenantor and covenantee the relation of grantor and grantee, which is all that there is between the grantee and his assignee. It is not thought that a covenant of warranty made by a stranger to the land would run with it, and perhaps the relation necessary to exist is that which would have constituted privity of estate at common law before the statute of Quia Emptores, although the rent or services reserved which were, perhaps, an incident of the old privity, are not now usual. On the authority ofPackenham's case, sometimes called the Prior's case, stated in the text, the English editor lays it down broadly that the covenantor may be a stranger to the land, but that case stands by itself, and it may well be doubted if, at the present day, a covenant to warrant the title, or to keep buildings in repair (for instance), made by a stranger to the land, would be held to run. It is possible that some explanation of that case might be found in the religious nature of the service and the connection of the convent and the manor. If it should be followed to the extent suggested by the English editor, it would be a startling exception to the otherwise universal rule that there must be some land or interest in land pass in connection with the covenant."

Covenants annexed to estates in privity, or covenants running with the land, are incidents to the estate. Coke, when at the bar, successfully took the position (Noke v. Awder, Cro. Eliz. 373) that if A had no estate in land and assumed to convey it with covenants for title to B, who assumed to convey it with like covenants to C, that C being evicted by a title paramount to A's pretended title, could not recover against A on his covenant, because he having no estate, title or interest in the land, nothing passed to B to which the covenants could attach as incidents. This doctrine led to the logical conclusion that when a grantee lost his land and needed the aid of his covenants for title, that they became worthless. Much that has been written about the liability of strangers to title being liable on their covenants of warranty has been in refutation of the doctrine of the case last cited. It is hardly necessary to say that this doctrine has long been exploded, and is but remotely, if at all, connected with the question which lies at the root of this case.

The judgment should be reversed and a new trial granted, with costs to abide the event.