Sohns v. . Beavis

Vann, J.

We agree with the learned Appellate Division that a sale of land in the haste and confusion of an auction room is not governed by the strict rules applicable to formal contracts made with deliberation after ample opportunity to investigate and inquire. When the plaintiff was required to sign the terms of sale or lose the benefit of his bid, he could not ascertain the extent of the restrictions relating to buildings which then came to his notice for the first time. While he then learned that there were building restrictions he did not know their nature and lie was told by the clerk to whom he paid the money that “ these restrictions are all right. They are only for private houses and you are all right.” The description delivered to him by the auctioneer before the sale gave notice of restrictions against nuisances, but none as to restrictions upon the right to build. When he signed the terms of sale within a few minutes after the property had been struck off to him, he had no chance to investigate but had to act at once. The building restrictions were not fairly or sufficiently described, because the extraordinary feature, of which good faith required disclosure, was in nowise alluded to. Under the circumstances he had the right to assume that the “restrictions as to buildings” therein contained were of the ordinary kind for “private houses” and that they were “ all right,” according to the assurance given, or at least that the3r were not so unprecedented and unreasonable as to make the title unmarketable. When compelled, to sign so suddenly, although he then knew that the restrictions extended to buildings, as was said by Mr. Justice Scott, writing for the Appellate Division, “ he was entitled to a reasonable opportunity to ascertain' what the restrictions were.” If they had turned out to be within the range of ordinary experience, even if strict and severe, the plaintiff would have been bound to complete his purchase, for the circumstances surrounding the sale would afford protection only against a situation so far beyond reason as to amount to imposition. The restrictions, however, were not within reason or precedent, and would not have been regarded as possible even by the most prudent and cautious. If the covenant in the original deed had been to build only out of Carrara marble or Russian malachite, or not to build at all, clearly the plaintiff would not have been bound to comply with the terms of sale, although he had signed them. Such a covenant would be-fraudulent upon its face, for it is a fraud for one person to take undue advantage of another to his pecuniary injury.

Building restrictions if mutual and uniform throughout a large tract consisting of many lots, may be an advantage instead of a detriment to all concerned. Through the protection afforded against cheap buildings, offensive trades and irregular location of building lines with reference to the street line, the value of every lot may be materially increased, for the restraint upon all the lot owners may give such character to the neighborhood as to make it desirable for residences of the best class. “ Restrictions as to buildings,” in the absence of any further description, according to common usage, means restrictions of the general character thus alluded to and would be so understood by the average purchaser. Those words do not mean restrictions which do not restrain except at the election of a remote grantor. A restriction “ with a string to it ” does not restrain if its creator sees fit to pull the string. As was said below: “ The advantage to a purchaser of real estate from a covenant against nuisances is not that his own property is restricted, but that 1ns neighbors’ property is.” The plaintiff had the right to assume from the printed terms of sale that all the purchasers were restrained in the same way and to the same extent that he was, himself, and that no one could vary or release without the consent of all. A club held by a former owner by retaining control of the right to build is not a building restriction in any proper sense.

The restrictions in question were not usual, mutual, uniform or reasonable, because they restrained one party and by express agreement opened the door wide to the other. During the period of thirteen years, the original grantor of the entire tract, “its successors and assigns,” even after it had sold every lot, could agree with “ the owner or any of the owners ” of any lot or any part of any lot, “ to alter or annul said covenants and restrictions as to any portion of said premises, without the consent of any owner or owners of any other premises situate in Tremont Terrace,” which comprised the seventy-three lots sold at the auction. This singular provision was not written in the deeds of the lots so sold, nor did it appear otherwise than by reference to the record of a deed given by a realty company conveying the tract to the defendant Beavis,- for whom the sale at auction was held. A restrictive covenant of this kind would enable the original grantor to hold every one of its grantees and their grantees at its mercy. They would be bound and helpless, while it would be in a position to exact and extort. After the tract had been well built up with beautiful homes, unless the exactions of the company were complied with it could open any part of it to any kind of business from a livery stable to a saloon. In the absence of local regulations it could bring virtual destruction to any dwelling house, however valuable for residential purposes, by selling the right to tan hides or make dynamite upon either side thereof. It could permit every alternate lot owner to build up to the street line and prevent the others from building within twenty feet of the line. It could place at defiance all the lot owners but one by releasing the latter from the covenants by which all the others were bound. The question is not what will be done, but what may be done.

We think that the restrictions, so imperfectly described in the terms of sale, did not give fair notice of the restrictions afterward put in the deed tendered to the plaintiff; that under the circumstances surrounding the sale and the assurance given right after the sale he had a reasonable time to investigate; that upon discovery of the actual facts he had the right to rescind the transaction and sue for the recovery of the amount paid down together with the reasonable expenses incurred in examining the title.

The order of the Appellate Division should be affirmed and judgment absolute rendered against the defendants upon their stipulation, with costs in all courts.

Cullen, Ch. J., Gray, Haight, Willard Bartlett, Hiscock and Collin, JJ., concur.

Order affirmed, etc.