Hayslett v. Shell Petroleum Corp.

This action comes from the common pleas court on appeal.

The plaintiff, Robert E. Hayslett, is the owner of a parcel of land in an allotment of land made by C.N. Sheldon, which allotment fronts on Euclid avenue in the city of East Cleveland, a few hundred feet west of Shaw avenue. The original recorded plat contains no restrictions whatever, but the deeds to the first fourteen lots sold by the original owner contain a provision as follows:

"It is mutually agreed, by and between the grantor and the grantees herein, as part of the consideration for this deed, that the following restrictions shall be considered as covenants running with the land and not conditions, and the same shall be binding upon the grantors and the grantees herein, their heirs, executors, administrators and assigns for the period of thirty (30) years from and after the date of this deed."

One of the restrictions incorporated in those early deeds is as follows:

"It is mutually agreed by and between the grantor and grantee herein, as a part of the consideration of this deed, that grantor shall restrict his lots fronting on Euclid Avenue and Sheldon Avenue to single family residences only, and no building shall be erected thereon nearer than 20 feet to Sheldon Avenue."

The restrictions, if valid, will not expire until 1941, and until then the land on Euclid avenue may not be used except for single family residences.

Counsel for plaintiff frankly stated to the court that Euclid avenue is not suitable by reason of changed conditions for the building of single family residences, and that until 1941 it is probable that no use could be made of the land if the restrictions were to be enforced.

The above restrictions were not incorporated in any deed from the original owner of the land above granted to defendant, nor were said restrictions incorporated in the deed of the land sold to the defendant, and it is conceded that the defendant had no actual knowledge of the restrictions. It is claimed, however, that defendant had constructive notice of the restrictions contained in the original fourteen deeds, although the restrictions do not show or appear in the chain of title of the defendant's land.

Three claims are made by the defendant. It claims that the restrictions are invalid for the following reasons:

1. There was no general plan of restrictions provided in this allotment which affected the Euclid avenue frontage and all other owners of lots in the same manner.

2. That even if the restrictions in the plan of allotment were general, the defendant had no notice, actual or constructive, of the scheme of the allotment, and therefore it is not binding upon it.

3. Even if the land were properly restricted, and the defendant had notice thereof, yet the character of the neighborhood and district has changed in such a degree that the restrictions are no longer binding.

As to the first two conclusions, the court may well adopt the decision of the common pleas court in this case, without further comment, for it seems to be settled in this state in the case of Kiley v. Hall, 96 Ohio St. 374, 117 N.E. 359, L.R.A., 1918B, 961, that: "A lot owner cannot maintain an action to enforce by injunction the observance of restrictions contained in the deed of another lot owner where it does not appear that the latter purchased his lot with notice of a general plan for the improvement of the lots of the allotment in accordance with the restrictions contained in his deed, or with notice that such restrictions were inserted in his deed for the benefit of the owners of the other lots in the allotment."

This authority seems to be fortified by the case of Adams v.Donovan, 97 Ohio St. 83, 85, 119 N.E. 252.

Whatever may have been in the minds of the original grantor and the first grantees, as to a general plan of allotment, and whatever may have been the rights or remedies of subsequent lot owners against the original grantor for breach of covenant, it seems clear that there was no general plan of allotment in the sense that it affected all of the lots, and that no general plan of allotment was set up in the original plat of subdivision.

If the claim of the plaintiff were true that there was a general plan of allotment, and that the defendant had effective notice of the restrictions because some deeds not in the grantee's chain of title contained the restrictions, it would compel every purchaser of a lot in any allotment, no matter of how long standing, to search the deeds of each and every other purchaser of such a lot, from the time of the sale of the first lot down to the date of the last purchaser, to determine whether or not there was incorporated in any of the deeds an agreement by the original owner that all the lots should be sold with restrictions.

It is not customary, and in fact it would be well-nigh impossible in as populous a county as Cuyahoga, for the purchaser of land to examine the deed to every lot in an allotment, in which he desired to purchase land, for the purpose of seeing whether or not there was an agreement between the original grantor and some of his grantees. If that were the law, and if purchasers of lots with no actual notice of restrictions would be bound by such a provision, it would mean that every such purchaser of a lot in any allotment, where there is nothing in the deed or recorded plat to indicate restrictions, would be required to make a search of the county records of every one of the lots in the allotment to ascertain whether or not any restrictions had been made between the grantor and some grantee regarding a lot in which and to which the recent purchaser would have no interest. Such a rule would needlessly burden the operation of real estate allotment agencies in every populous county. It would be a source of jeopardy to every purchaser of a home site. It would require extended examination of hundreds of deeds at a cost prohibitive to the purchaser, and such a rule would seriously interfere with legitimate real estate development.

We hold that, because there was no general plan which affected all property in the allotment alike, and because there were no restrictions written in the recorded plat, and none in the deed to defendants, and because they had no notice either actual or constructive of any restrictions affecting the Euclid avenue frontage of the Sheldon allotment, or of any such plan which may have been in the mind of the original allotment owner, the alleged restrictions have no binding effect on the defendants.

It is further claimed that the restrictions, even if they were valid, are not binding, because of the changed character of the district in which the land is located.

We do not deem it necessary to make an extended discussion of the facts, for the frank statement of counsel for plaintiff was that the land in question, because of its inutility for the purpose which the restrictions provide, would probably compel the land to remain idle for a period of eleven years.

That the character of the district is changed, and that the land is no longer suitable for single family residences, can not be seriously doubted. The city of East Cleveland has zoned this land for business, and while this cannot affect the restrictions if they exist, yet it is evidence indicating the changed character of the neighborhood.

The plat submitted and the evidence show that many substantial commercial buildings exist on Euclid avenue, both to the east and west of Sheldon avenue. The character of the traffic on the street and the character of the business in and about the district leave no room for doubt that Euclid avenue at Sheldon avenue is a business and not a residential district.

Shaw High School was built upon the Sheldon allotment, and a part of the allotment at the southerly end was used for road purposes; neither of these uses is for a "single family residence." The plaintiff, however, claims that even though the character of the district has been changed, and even though the Euclid avenue frontage were to remain idle for eleven years, yet if there is any value left in the original restrictions to the remaining holders of the property in the allotment the restrictions must be enforced. We do not believe that such is a proper construction of the law cited by diligent counsel for plaintiff in Cooper v. Sanders, 30 O.L.R., 435. In that case, it is true, the syllabus states that the original restrictions must be of no value before they can be treated as a nullity, but the facts in that case and the reasoning of the court upon which the decision is based clearly show that the restrictions may be treated as a nullity, if they have no substantial or reasonable value to the property claiming the benefit thereof.

The rule of reason must be read into cases where change of character of neighborhoods is relied upon to invalidate or modify restrictions.

The language of the court in the Cooper case, supra, is as follows:

"If there have only been changes of an unsubstantial nature that do not destroy the essence and the character of the neighborhood for residential purposes to such a degree that it vitally affects the value of the restrictions, then the change does not reach that point where a court of equity can say that the restrictions are a nullity. There must be clear, convincing and substantial evidence to change the character of a neighborhood to such an extent that the court can pronounce a judgment saying that the restrictions as to residences have lost their value. There must be a situation actually existing that is contrary to any sound reason for further structures with restrictions of the character stated. It should appear that there is no further reason for contemplating future structures of that character. Slight changes are not sufficient, because they do not affect the substantial character of the neighborhood."

A similar conclusion was reached by this court in a case involving the restrictions to property on Drexel avenue and East 105th street, Cleveland.

We hold that such a changed condition exists in the neighborhood of Sheldon and Euclid avenues that the restrictions incorporated in the original deeds, even if they were valid, would not be effective because the changed condition of the neighborhood has substantially destroyed the value of the restrictions.

The appeal will be dismissed, and a decree may be entered for defendant.

Decree for defendant.

VICKERY, P.J., and LEVINE, J., concur.