Opinion ID: 901858
Heading Depth: 2
Heading Rank: 1

Heading: Deeds without Limiting Language

Text: [¶ 28.] The 1890 deeds from Morgan, Norine, and Pettit grant certain property to FEMV without any provision in the granting or habendum clauses limiting the use of the conveyed land. Specifically, the granting clauses convey the entire estates without exceptions, reservations, or specifications on the use of the land. What we must determine, therefore, is whether the reversionary language in the habendum clauses, providing that if the railroad abandons its road, all right, title and interest in the conveyed land shall revert to the grantors, their heirs and assigns, creates fee simple determinable estates or fee simple estates subject to a condition subsequent. [¶ 29.] Based on our review of the language of these deeds and the law related to determinable and conditional estates, we conclude that the parties intended to convey fee simple title subject to a condition subsequent. Although the grantors included reversionary language, the grantors in no way limited the use of the land conveyed for any particular purposes. There are also no restrictions, limitations, or reservations in the habendum clauses. [¶ 30.] Courts faced with similar language common to both estates  provided that (condition subsequent) and shall revert (determinable fee)  have held that a fee simple estate subject to a condition subsequent was intended. See Neb. Dept. of Roads, 490 N.W.2d at 466-67; Oklahoma City, 134 P.2d at 569-70; see also Concord & Bay Point Land Co. v. City of Concord, 229 Cal.App.3d 289, 280 Cal.Rptr. 623, 625-26 (1991) (conveyance upon the following terms and conditions was a fee simple subject to conditions subsequent despite existence of shall revert); Hannah v. Southern Pac. R. Co., 48 Cal.App. 517, 192 P. 304, 306 (1920); Mouat v. Seattle L.S. & E. Ry. Co., 16 Wash. 84, 47 P. 233, 234 (1896); see also Restatement (First) of Property § 45 cmt. m (1936) (updated 2009). These courts reach this conclusion, in part, because the language employed by the grantors only imposed conditions subject to penalty of forfeiture if breached and did not otherwise limit the purpose of the conveyance. The courts also noted that the mere existence of shall revert is insufficient to create a fee simple determinable estate. Neb. Dept. of Roads, 490 N.W.2d at 466 (granting clause and habendum clause do not limit the estate); see also Concord & Bay Point Land Co., 280 Cal.Rptr. at 626 (conveyance did not limit for any purpose in the granting clause); Oklahoma City, 134 P.2d at 570. [23] [¶ 31.] Because we conclude that the deeds without limiting language conveyed fee simple estates subject to a condition subsequent, we must now determine if any of the stated conditions have been breached. The only condition implicated in the Morgan, Norine, and Pettit Deeds is whether FEMV, its successors or assigns, shall abandon said road. . . . (Emphasis added.) NHRRA does not dispute that CNW ceased service of the railroad, but it contends that CNW and its successors in interest have never abandoned the road, in part, because CNW sold the property to the State. [24] [¶ 32.] To properly consider what actions can cause a breach of a condition, we do not interpret the word road in isolation. Rather, we consider all the words used to create the condition. The conditional sentence states, Provided, That if said railroad shall not be located and graded within ten years from the date hereof, or if at any time after said railroad shall have been constructed, the said party of the second part, its successors or assigns, shall abandon said road, or the route thereof shall be changed so as not to be continued over said premises the land hereby conveyed, and all rights in and to the same, shall revert to the said parties of the first part their successors and assigns. (Emphasis added.) Under this language, a breach can occur by less action than that required for complete abandonment of the property. The conditional sentence first requires that the railroad be constructed in ten years. It then states that after the railroad is constructed the road shall not be abandoned, or re-routed. Use of the terms road or railroad are not synonymous with property or interest. [¶ 33.] Therefore, while we agree with NHRRA that CNW's attempt to sell its interest in the property to the State exhibited an intent contrary to abandonment of the property, the question here is not whether CNW, its successors or assigns, abandoned the property. Rather, we must decide whether CNW's actions have breached the condition in the deeds that the road not be abandoned. Based on our review of the stipulated facts, when CNW removed all tracks and facilities in 1970, and no railroad service has since been conducted on that property, the condition was breached. [¶ 34.] NHRRA next claims that if a breach has occurred, plaintiffs' right of re-entry is barred by the Marketable Title Act, SDCL 43-30-3, and the statute of limitations, SDCL 15-3-3. First, the Marketable Title Act does not apply to cause the expiration of conditions subsequent. See SDCL 43-30-12 (This chapter shall not be applied to bar . . . conditions subsequent in any deed.). Second, unlike other states, South Dakota has no statute of limitations specifically related to breaches of conditions subsequent. See Cal.Civ.Code 885.050; 735 ILCS 5/13-102 (Illinois); MGLA 260 § 31A (Massachusetts); MD Code Real Prop. 6-103 (Maryland); MSA 500.20 (Minnesota); NY RP ACT & PRO 612; Va.Code Ann. 8.01-255.1. Moreover, SDCL 15-3-3 does not bar a claim for re-entry upon a breach of a condition subsequent. Rather, it provides the statutory time for a landowner to take land back from someone attempting to establish adverse possession. [25] Rotenberger v. Burghduff, 2007 SD 19, ¶ 18, 729 N.W.2d 175, 180-81. [¶ 35.] When NHRRA obtained title to the property described in these deeds, it became the owner in fee subject to the conditions stated. See In re Opening and Extending of N. Conduit Ave., 262 A.D. 70, 27 N.Y.S.2d 841, 843-44 (1941). Because CNW breached a stated condition in 1970, the heirs, successors, and assigns of the original grantors (plaintiffs) have the power to terminate the estate. NHRRA has not provided any reason why plaintiffs' quiet title suit cannot be maintained. [26] Therefore, the court did not err when it quieted title against NHRRA to the property in the Morgan, Norine, and Pettit Deeds.