Court Opinion

ID: 5480484
Source: CourtListenerOpinion
Date Created: 2022-01-10 01:39:29.868258+00
Date Added: 2024-06-11T08:33:36.471824
License: Public Domain

McLaughlin, J. (dissenting).
This action was brought to recover damages for the alleged breach of a covenant against incumbrances contained in a deed of conveyance from the defendant to the plaintiff. The material allegations of the complaint are that the defendant, a domestic corporation, on December 21, 1906, in consideration of $750,000, conveyed to the plaintiff certain lands in the city of New York; that by the deed of conveyance the defendant covenanted that the lands conveyed were free from incumbrances; that at the time of the delivery of the deed the lands were not free from incumbrances, but were subject to the lien of a lease made August 22, 1892, between the defendant and the Brooklyn City Railroad Company; that in condemnation proceedings subsequently taken by the plaintiff it was determined the interest of the railroad, company in said lands was $83,545.33, with interest, which amount the plaintiff was obliged to and did pay and for which sum judgment was demanded, an action at law and nothing else. The answer denied the allegation that there had been a breach of the covenant against incumbrances and set up certain affirmative defenses which, in the view I take of the question presented by the appeal, it is unnecessary to consider. At the trial a verdict was directed for the defendant dismissing the complaint. Judgment was entered to this effect, which was affirmed by the Appellate Division, one of the justices dissenting, and an appeal to this court followed.
The sole question presented by the appeal is whether the evidence adduced at the trial showed there had been a breach of the covenant as alleged in the complaint, or the jury would have been justified in so finding. A care*28ful consideration of the record has satisfied me that the evidence did not establish such breach and the jury would not have been justified in finding to the contrary. This was the position, among others taken by the defendant at the trial and on-the argument of the appeal. The appellant, however, contends that the agreement between the defendant and the Brooklyn City Railroad Company, dated August 22, 1896, which was in force when the deed was delivered, constituted an incumbrance. Whether this contention be well founded necessitates a brief reference to the agreement.
The agreement, in substance, grants to the railroad company a limited right of way on a parcel of land 100 feet square for the purpose of storing cars thereon and for switching purposes, and specifically provides that “ The said use shall be as follows, to wit: The party of the first part shall have the privilege of laying its tracks upon said last described plot of land and of using the same for a car stand for its passenger cars and as a switching place for its passenger cars and for the general purpose of securing convenient transit or passage for its passengers between the cars and ferry house. * *
According to the terms of the instrument the privilege thus granted could be terminated in two ways: (a) By the railroad company discontinuing carrying passengers to this point; (b) by the ferry company giving to the railroad company six months’ written notice of an intention to terminate, and by paying to it the amount expended in removing the ferry house from the 100-foot plot to a new site. (The amount thus paid was stipulated by the ferry company and the railroad company at the time the ferry house was moved or shortly thereafter to be “ $83,545.38,” and that was the amount, with interest, the city had to pay to the railroad company in the condemnation proceeding.) The right acquired under the agreement by the railroad company was in the nature of an easement running with the land. It was a grant in *29fee or of a freehold estate. (Real Property Law [Cons. Laws, ch. 50], sec. 33; Nellis v. Munson, 108 N. Y. 453.) It could only be extinguished by the happening of one or both of the events stated. The deed from the defendant to the city was dated December 21, 1906. It was duly acknowledged and could have been recorded immediately after delivery. The agreement between the railroad company and the ferry company was not acknowledged, nor its execution attested by a subscribing witness. This is conceded in the prevailing opinion and the authorities there cited fully sustain this conclusion. The city, therefore, as between it and the ferry company, notwithstanding the agreement, obtained a title free from incumbrances. The Real Property Law provides :
“ Section 243. Grant of fee or freehold. A grant in fee or of a freehold estate, must be subscribed by the person from whom the estate or interest conveyed is intended to pass, or by his lawful agent. If not duly acknowledged before its delivery, according to the provisions of this chapter, its execution and delivery must be attested by at least one witness, or, if not so attested, it does not take effect as against a subsequent purchaser or encumbrancer until so acknowledged.”
In Chamberlain v. Spargur (86 N. Y. 603, 607) an action was brought to set aside conveyances and leases under which defendants claimed, as clouds upon plaintiff’s title. The original owner of the lands subscribed, but did not acknowledge, a deed thereof under which the plaintiff claimed. Such owner subsequently executed deeds and leases properly acknowledged under which defendant claimed. It was held that the defendant had good title and the complaint was dismissed. Judgment to this effect was affirmed by this court. Judge Finch, who delivered the opinion of the court, said: “ The grantor who has signed a deed, unattested and unacknowledged, is left with the power of effectively conveying by a later deed properly executed. The party who has taken the *30imperfect instrument does so at his peril, and with eyes open to the consequences. The grantor may, nevertheless, convey, and it matters not upon what consideration or for what purpose. That concerns him alone. The contrary construction would make the unattested and unacknowledged deed quite as good as the perfect and regular one, while the latter remained unrecorded. Each alike would yield only to the rights of the innocent purchaser, obeying the requirements of the law. * * * We have thus no difficulty in construing the statute literally and just as it reads.”
In Nellis v. Munson (supra) an action was brought to restrain the defendant from interfering with a pipe laid across his premises to conduct water to the plaintiff’s premises. The easement had been created by an agreement, not then witnessed or acknowledged. After making the agreement the owner of the premises contracted to sell the same, excepting the privilege given to the plaintiff; but she conveyed the premises by a warranty deed without mentioning the plaintiff’s easement. After the conveyance the grant of the easement was acknowledged by the grantor. . Subsequently the premises were conveyed to the defendant by warranty deed containing no mention of the easement, but the defendant knew of plaintiff’s rights and the existence of the' pipe before he purchased. This court, reversing a judgment in favor of plaintiff, said: "We are therefore of the opinion that the easement conveyed was an estate in fee, and required for its conveyance a deed, executed in the manner prescribed by the statute, to affect the right of a subsequent purchaser. We are much impressed with the apparent equities of the plaintiff’s claim, in view of the fact that the subsequent grantees of the servient estate took title with notice of the easement claimed by the plaintiff, but we see no way of escaping the effect of the plain Words of the statute.” (p. 461.)
In Dunn v. Dunn (151 App. Div. 800, 804) the execution *31and delivery of an earlier deed were never attested by a witness. It was, however, after the later deed had been executed and recorded, and the court held: "It was, therefore, invalid as against Jennie F. Dunn, the said subsequent grantee. It was invalid even though Jennie ,F. Dunn had actual notice of the prior deed, and even though she was not a purchaser in good faith and for value."
It is quite immaterial and beside the question that the city in accepting the conveyance from the ferry company in December, 1906, had notice and actual knowledge of the right or easement granted to the railroad company by 1 the agreement of 1892. The effect of the later conveyance was to vest in the city the entire fee of the premises conveyed free and clear of the easement created in favor of the railroad company by the earlier instrument. It follows, therefore, that the premises were conveyed without incumbrances.
But it is said, not by counsel, " that the equities arising from contract, possession and improvement" cannot, because there is no breach of the covenant against incumbrances, be similarly disposed of; that while " the statute nullifies the instrument as a formal grant * * * it does not .nullify rights and interests which would be maintained and protected irrespective of the grant; ” that in equity the rights of the railroad were equivalent to those of ownership and a purchaser with notice would not be permitted to ignore them.
There are, as it seems to me, two answers to the suggestions thus made: (1) The action, as we have seen, is one j at law. The plaintiff must stand or fall upon the platform he has constructed. He cannot leave that and go to another. Having brought the action at law, he must recover upon that theory or not at all. This is the issue raised by the pleadings. It is the theory upon which the action was tried and the appeal argued. (2) A recovery upon that ground is contrary to the rule laid down in Chamberlain v. Spargur (supra) and Nellis v. *32Munson (supra). It may be that the railroad company would have had a right of action against the ferry company for the destruction of its rights under the agreement, but even so the situation is in nowise changed. The fact remains that the city got a good conveyance of the entire title free from incumbrances. It, therefore, had no right of action against the ferry company upon the theory ' that the railroad company had some equities which had been destroyed by the conveyance. The city in fact knew as much about the rights of the railroad company as the ferry company did. It had been served by the railroad company with a written notice of its claim and the amount thereof, prior to the time the conveyance was made. Indeed, it had been served with a copy of the agreement and it knew precisely what the'railroad had and what it claimed before the deed was delivered. Under such circumstances it is difficult to see how it is in a position to ask a court of equity to exercise its powers to relieve it from what it had to pay the ferry company in the condemnation proceeding. That award was made upon the theory that the city, by the conveyance to it, took the place of the ferry company, and the right of the railroad company could not be wiped out until it had been paid for the improvements which it had put upon the property. (Matter of City of New York, 76 Misc. Rep. 358; affd., on opinion below, 150 App, Div. 908; affd., 206 N. Y. 655.)
The foregoing views render it unnecessary to pass upon the other questions raised by the appeal.
I, therefore, dissent and vote to affirm the judgment appealed from.
His cock, Ch. J., Hogan and Pound, JJ., concur with Cardozo, J.; Crane and Andrews, JJ., concur with McLaughlin, J.
Judgment reversed, etc.