Nejati v. Stageberg ( 2013 )

PRESENT: All the Justices
COREY NEJATI, ET AL.
OPINION BY
v. Record No. 121728 JUSTICE WILLIAM C. MIMS
September 12, 2013
STEPHEN P. STAGEBERG, ET AL.
FROM THE CIRCUIT COURT OF THE CITY OF FREDERICKSBURG
Gordon F. Willis, Judge
In this appeal, we consider whether zoning laws may
restrict the sale of real property and particularly whether
Code § 15.2-2254 limits the ability of a seller to convey
severalty interests.
I. BACKGROUND AND MATERIAL PROCEEDINGS BELOW
In 2005, Kristopher Angstadt acquired a parcel of real
property in the City of Fredericksburg. The tax map maintained
by the City of Fredericksburg Commissioner of Revenue indicated
that the parcel was a single lot. However, the Commissioner’s
records also indicated that in 1942 it had been listed as two
separate “tax parcels.”
In 2008, Angstadt hired Long Surveying, L.L.C. (“Long
Surveying”), to prepare a survey of the property. The survey
drew boundary lines that corresponded to the boundaries of the
two tax parcels shown on the Commissioner’s records from 1942.
The larger lot depicted on the survey was designated 901
Hanover Street (the “Hanover Property”), and the smaller lot
was designated 802/804 Littlepage Street (the “Littlepage
Property”). Angstadt recorded the survey; however, he did not
submit it for approval by the City as a subdivision as set
forth in Code § 15.2-2254 and Fredericksburg City Code (“City
Code”) § 78-1304(a).
Angstadt subsequently transferred the two purported lots
to his real estate company, Properties By Us, L.L.C. (“PBU”),
by two separate deeds. PBU converted a duplex on the
Littlepage Property into a two-story apartment building. The
Hanover Property was left undeveloped.
In June 2008, PBU conveyed the Littlepage Property,
including the apartment building, to Corey and Robabeh Nejati
by a deed that referenced and incorporated the previously-
recorded survey. Two months later, in August 2008, PBU
conveyed the Hanover Property to Stephen Stageberg. This deed
also referenced and incorporated the survey.
By separate contract, PBU agreed to build a single family
house for Stageberg on the Hanover Property. However, when PBU
applied for a zoning variance, the City’s Zoning Administrator
concluded that a house could not be built on the Hanover
Property since it had not been subdivided, and therefore did
not exist as a separate lot, pursuant to Code § 15.2-2254 and
City Code § 78-1304(a). Stageberg subsequently exhausted his
administrative remedies but was unable to obtain a variance.
2
After reaching a settlement agreement with the title
insurance company that insured his interest in the Hanover
Property, Stageberg filed a quiet title action against the
Nejatis in the Circuit Court of the City of Fredericksburg. 1
Stageberg alleged that the legal effect of the 2008 deeds from
PBU to himself and to the Nejatis was to create a tenancy in
common of the undivided parcel acquired by Angstadt in 2005,
without regard for the Littlepage Property and Hanover Property
boundaries as described in the survey and the 2008 deeds. The
Nejatis responded that the 2008 deeds created two distinct
estates in severalty, each with boundaries as described in the
survey. 2
In a letter opinion, the circuit court held that the
claimed estates in severalty were impermissible because such
result would effectively circumvent the requirements for a
valid subdivision under Code § 15.2-2254(3) and City Code § 78-
1304(a). Thus, the circuit court concluded that Stageberg and
the Nejatis were tenants in common of the whole property. The
court determined the percentage ownership based on the original
1
Angstadt, his corporate alter egos, several financial
institutions, and the trustees on the deeds of trust were also
named as party-defendants. None of these parties have filed
appearances in this Court.
2
Alternatively, the Nejatis argued that because their deed
was recorded first, it conveyed the whole property to them,
leaving nothing for PBU to convey to Stageberg. However, they
did not pursue this argument on appeal.
3
purchase prices that the parties had paid, which resulted in
the Nejatis owning a 71.43 percent interest and Stageberg
owning a 28.57 percent interest in the undivided parcel. This
appeal followed.
II. ANALYSIS
The dispositive issue on appeal is whether the circuit
court erred in holding that Stageberg and the Nejatis share
ownership of the undivided parcel as tenants in common rather
than as tenants by severalty.
It is well established in Virginia that a tenancy in
common may be created when “a deed is of a given quantity of
land, parcel of a larger tract, and the deed fails to locate
the quantity so conveyed by a sufficient description.” Hodges
& DeJarnette v. Thornton, 138 Va. 112, 118, 120 S.E. 865, 867
(1924) (internal quotation marks omitted). In such instances,
a tenancy in common results because “no one knoweth his own
severalty; and hence the possession of the estate necessarily
is in common until a legal partition [is] made.” Id. at 119,
120 S.E. at 867 (internal quotation marks omitted). However,
when a deed “locates the lands by name or metes and bounds so
that each party knows his land[s] or where they are located
with such certainty that a surveyor can take the [deed] and
locate them, . . . the [transferees] . . . hold in severalty,
4
and not as tenants in common.” Id. at 121, 120 S.E. at 868
(internal quotation marks omitted).
In this case, both Stageberg and the Nejatis know with
certainty the property they purchased pursuant to their deeds.
The Nejatis’ deed describes their property as:
ALL THAT certain lot or parcel of land with all
rights and privileges appurtenant thereto,
situate, lying and being in the City of
Fredericksburg, Virginia, and known as #802,
#804 Littlepage Street, containing 1,725.24
square feet as shown on a plat of survey dated
April 2, 2008, by Long Surveying, L.L.C., Land
Surveyors, which plat is recorded in the Clerk’s
Office of the Circuit Court of the City of
Fredericksburg, Virginia, as Instrument No.
080000914; and commonly known as 802 and 804
Littlepage Street.
Stageberg’s deed describes his property similarly:
ALL THAT certain lot or parcel of land with all
rights and privileges appurtenant thereto,
situate, lying and being at the northwest corner
formed by the intersection of Hanover and
Littlepage Streets, in the City of
Fredericksburg, Virginia, and containing
2,185.97 square feet as shown on a plat of
survey dated April 2, 2008, by Long Surveying,
L.L.C., Land Surveyors, which plat is recorded
in the Clerk’s Office of the Circuit Court of
the City of Fredericksburg, Virginia, as
Instrument No. 080000914; and commonly known as
#901 Hanover Street.
The plat of survey by Long Surveying is expressly
referenced and incorporated into both deeds. It is an accurate
description of the properties conveyed. See Richardson v. J.S.
Hoskins Lumber Co., 111 Va. 755, 757, 69 S.E. 935, 936 (1911);
5
State Savings Bank v. Stewart, 93 Va. 447, 453, 25 S.E. 543,
544 (1896) (“Where a map of land is referred to in a deed for
the purpose of fixing its boundaries, the effect is the same as
if it were copied into the deed.”).
This property description in the deeds and plat of survey
is sufficient to create estates in severalty. There are well-
defined boundary lines, precise square footage, and a metes and
bounds description for each parcel. Thus, the deeds clearly
“locate[] the lands by name or metes and bounds so that each
party knows his land[s] or where they are located.” Hodges,
138 Va. at 121, 120 S.E. at 868 (internal quotation marks
omitted).
Stageberg’s only argument is that the description provided
in the survey is rendered “indefinite” by Angstadt and PBU’s
failure to comply with Code § 15.2-2254 and City Code § 78-
1304(a).
Code § 15.2-2254 states in relevant part:
2. No plat of any subdivision shall be recorded
unless and until it has been submitted to and
approved by the local planning commission or by the
governing body or its duly authorized agent, of the
locality wherein the land to be subdivided is located
. . . .
3. No person shall sell or transfer any land of a
subdivision, before a plat has been duly approved and
recorded as provided herein . . . . However, nothing
herein contained shall be construed as preventing the
recordation of the instrument by which such land is
6
transferred or the passage of title as between the
parties to the instrument. 3
Neither Angstadt nor PBU submitted the survey for approval
prior to conveying the Littlepage and Hanover Properties.
Stageberg argues that until the parties comply with this
requirement, the boundaries set forth in the survey are subject
to change. Therefore, he claims that the deeds are not
sufficiently definite to create estates in severalty, and the
parties own the whole property as tenants in common.
Stageberg contends that the language set forth in Code §
15.2-2254(3) is limited to the “parties to the instrument.” In
other words, he argues that because he was not a party to the
Nejatis’ deed, their title to the Littlepage Property was not
perfected against him. Consequently, Stageberg claims that he
and the Nejatis own the whole property as tenants in common,
regardless of the boundaries described in the survey and
incorporated in the deeds. We disagree.
Failure to comply with Code § 15.2-2254 results in
significant limitations on the use of the property by the
owner; however, it does not prevent conveyance of the property.
Stageberg’s argument runs contrary to the long-standing
presumption in favor of the right to free alienation of
property. See Lipps v. First Am. Serv. Corp., 223 Va. 131,
3
City Code § 78-1304 contains substantively identical
provisions.
7
135, 286 S.E.2d 215, 218 (1982); Cribbins v. Markwood, 54 Va.
(13 Gratt.) 495, 506 (1856).
Although this Court has not directly addressed the
consequences of not complying with Code § 15.2-2254, the
Attorney General has concluded that the predecessor statute,
former Code § 15.1-473, 4 only restricts the use of unlawfully
subdivided property and does not affect the property interests
transferred by deed. See 1989 Op. Atty. Gen. 100.
Specifically, the Attorney General stated that “[a]n injunction
obtained pursuant to [former] Code § 15.1-499 . . . would not
be an effective remedy to prevent the transfer of title
pursuant to a subdivision created in violation of . . . the
subdivision ordinance. Any future development of the divided
property, however, could be restricted.” 5 Id. Although it is
not binding on this Court, an Opinion of the Attorney General
4
Title 15.1 was recodified in 1997 as Title 15.2. 1997
Acts ch. 587. The recodification made no substantive changes
relevant to this appeal.
5
This conclusion has twice been reached by Virginia
circuit courts. See Leighton v. Virginia Dep’t of Health, 2001
Va. Cir. LEXIS 1, at *4 (Fauquier Cnty. Cir. Ct. 2001)
(“[F]ailure to comply with applicable subdivision regulations
does not prevent . . . the passage of title as between the
parties to the instrument. However, a failure to properly
subdivide the parcel . . . places significant limitations on
the use of the property by the owner.”); Justus v. Lowell, 28
Va. Cir. 505, 508-10 (Loudoun Cnty. Cir. Ct. 1992) (“[W]hile
the provisions of § 15.1-473 [Code § 15.2-2254’s predecessor],
place limitations on the use and development of ‘subdivided’
land, . . . they are not, absent enforcement, a bar to the
alienation of land.”).
8
is “persuasive” and may be used as an aid in construing
legislative intent. Clinchfield Coal Co. v. Robbins, 261 Va.
12, 18, 541 S.E.2d 289, 292 (2001).
Transfers of property in violation of Code § 15.2-2254 are
not free from consequence. Code § 15.2-2254(4) provides:
Any person violating the foregoing provisions
of this section shall be subject to a fine of
not more than $500 for each lot or parcel of
land so subdivided, transferred or sold and
shall be required to comply with all provisions
of this article and the subdivision ordinance.
(Emphasis added.) Clearly, persons who take title to
unapproved lots are subject to laws regulating how such
property may be developed. This necessarily results in
Stageberg being unable to build a house on his property.
However, it does not change the property interests conveyed to
Stageberg and the Nejatis pursuant to their deeds. 6
As discussed, the 2008 deeds were unambiguous as to the
descriptions of the properties conveyed. Accordingly,
Stageberg and the Nejatis hold the Littlepage and Hanover
Properties in severalty, not as tenants in common.
6
Although compliance with Code § 15.2-2254 is not a
prerequisite to the ability to convey title, this does not
guarantee that the title conveyed is marketable. See e.g.,
Justus, 28 Va. Cir. at 510-11. Stageberg initially filed
claims against the seller for breach of contract, breach of
covenants of title, and/or rescission. However, he
subsequently nonsuited those claims.
9
III. CONCLUSION
For the foregoing reasons, we will reverse the judgment of
the circuit court and remand for further proceedings consistent
with this opinion. 7
Reversed and remanded.
7
Because we find that Stageberg and the Nejatis hold
distinct estates in severalty, we need not address the circuit
court’s allocation of ownership interests as tenants in common.
10