Fritts v. Gerukos

159 S.E.2d 536 (1968) 273 N.C. 116

H. E. FRITTS and Jim White
v.
James GERUKOS.

No. 356.

Supreme Court of North Carolina.

February 28, 1968.

Corne & Warlick, Newton, for plaintiff appellants.

Sanders & Lafar and Hollowell, Stott & Hollowell, Gastonia, for defendant appellee.

LAKE, Justice.

The validity of the ordinance is not questioned by either party. The plaintiffs do not contend that the defendant was not the owner in fee simple of the land described in the option agreement. They do not contend that a deed, proper in form, executed and delivered to them by the defendant would not have conveyed the land to them in fee simple. Their contention is that the existence of the ordinance and the failure of the defendant to comply with its provisions constituted an encumbrance such as to prevent him from giving to them a deed as specified in the option agreement.

A covenant of warranty is "an agreement or assurance by the grantor of an estate that the grantee and his heirs and assigns shall enjoy it without interruption by virtue of a paramount title, or that they shall not by force of a paramount title be evicted from the land or deprived of its possession." Cover v. McAden, 183 N.C. 641, 112 S.E. 817. "It is the law in this State that a cause of action for breach of warranty of title to real estate does not arise until there has been an ouster or eviction of the grantee or grantees under a superior title." Shimer v. Traub, 244 N.C. 466, 94 S.E.2d 363. There is no suggestion that had the plaintiffs gone into possession of the property under a deed from the defendant, proper in form, they could have been evicted under a paramount title.

A restriction upon the use which may be made of land, or upon its transfer, which is imposed by a statute or ordinance enacted pursuant to the police power, such as a zoning ordinance or an ordinance regulating the size of lots, fixing building lines or otherwise regulating the subdivision of an area into lots, is not an encumbrance upon the land within the meaning of a covenant against encumbrances or a contract or option to convey the land free from encumbrances, being distinguishable in this respect from restrictions imposed by a covenant in a deed. Lohmeyer v. Bower, 170 Kan. 442, 227 P.2d 102; Josefowicz v. Porter, 32 N.J.Super. 585, 108 A.2d 865; Lincoln Trust Co. v. Williams Bldg. Corporation, 229 N.Y. 313, 128 N.E. 209; Miller v. Milwaukee Odd Fellows Temple, Inc., 206 Wis. 547, 240 N.W. 193, 198; 55 AM JUR, Vendor and Purchaser, § 250; Annotation, 175 A.L.R. 1056; Annotation, 57 A.L.R. 1424. Thus, the existence of the Subdivision Standard Control Ordinance of the city of Gastonia at the time the option agreement was executed did not cause the title of the defendant to be subject to an encumbrance and the option agreement did not constitute an undertaking by him to take any action to comply with the provision of that ordinance so as to permit the plaintiffs to resell the land at public auction as they contemplated doing.

The evidence introduced by the plaintiffs does not show a violation of this ordinance by the defendant with respect to the land described in the option agreement. It merely shows that the defendant had not done those things which the ordinance provided must be done before lots are sold as parts of the subdivision. The option agreement not being an undertaking by the defendant to do these things, the injunction, subsequently issued as the result of advertising published by the plaintiffs, would not impose such obligation upon the defendant. The testimony of the plaintiffs' witness Garland, which is uncontradicted, is to the effect that the plaintiffs, by posting a bond to assure compliance with the requirements of the ordinance, might have proceeded with their plan for resale of the property at auction.

The plaintiffs do not proceed upon the theory that during the life of the option they tendered to the defendant the remainder of the agreed purchase price and he thereupon refused to execute the conveyance specified in the option agreement. Their evidence shows that they made no such tender. That being true, their right to recover the amount paid for the option agreement depends upon their proof of a defect in the title of the defendant or the existence of an encumbrance which it was his duty to remove under the terms of the option agreement. See 55 AM JUR, Vendor and Purchaser, § 44. The burden of proof was upon them to show such defect or encumbrance and the record contains no evidence thereof. The trial court might properly have granted the defendant's motion for judgment of nonsuit or directed a verdict in favor of the defendant. If there was technical error in the charge, and we find none, it was not prejudicial to the plaintiffs. Their assignments of error cannot be sustained.

No error.

HUSKINS, J., took no part in the consideration or decision of this case.