Court Opinion

ID: 4713323
Source: CourtListenerOpinion
Date Created: 2021-08-12 00:39:11.55177+00
Date Added: 2024-06-11T08:07:17.218300
License: Public Domain

¶13 (dissenting) — I disagree with the majority’s determination that Susan Alby placed a valid restraint on alienation of her niece’s property and that the *375Court of Appeals should be affirmed. While I agree that a reasonableness test applies to restraints on alienation, I would hold that the restraint in this case was not reasonable because the cherished value that our state places on free alienability outweighs the value to the Alby family of maintaining the property in family ownership.
Alexander, C.J.
*375¶14 We determine whether a restraint on alienation is reasonable or unreasonable based on “factual determinations and consideration of the equities,” Morris v. Woodside, 101 Wn.2d 812, 818, 682 P.2d 905 (1984), and on an assessment of the “legitimate interests of the parties.” Erickson v. Bank of Cal., 97 Wn.2d 246, 249, 643 P.2d 670 (1982). Determining reasonableness also requires “weighing the utility of the restraint against the injurious consequences of enforcing the restraint.” Restatement (Third) of Property § 3.4, at 440 (2000).
¶15 Thus, we first consider the “legitimate interests of the parties.”5 Eugene and Susan Albys’ interest was keeping the property in the Alby family. Lorri and Larry Brashlers’ interest, on the other hand, was that of realizing the right of a property owner to freely dispose of his or her property interest, which, as this court has recognized, is among the “ ‘fundamental attribute [s] of property ownership.’ ” Manufactured Hous. Cmtys. v. State, 142 Wn.2d 347, 364, 13 P.3d 183 (2000) (quoting Guimont v. Clarke, 121 Wn.2d 586, 595, 854 P.2d 1 (1993)). As has been observed in the Restatement (Second) of Property,
[i]f the full benefits which flow from the freedom to alienate an interest in property . . . are to be obtained, the owner of such interest must be able to take advantage of any of the existing methods of transferring property. Any restraint which interferes with the power to alienate in some manner, though it leaves the owner of the estate free to alienate in other ways, may substantially hinder him in disposing of the property.
Restatement (Second) of Property § 4.2 cmt. n at 183 (1983).
*376¶16 According to Susan Alby, the parties here “freely contracted for the exchange,” Answer to Pet. for Review at 11, with full knowledge and after an opportunity to freely negotiate the terms of their bargain. She argues that, although the Brashlers’ right to exercise one of the incidents of property ownership was limited by the terms of the deed, this limitation was reflected in the selling price of the property as they paid significantly below market price.
¶17 However, nothing in the record supports the claim that the Albys and the Brashlers bargained for a reduction in price in exchange for an estate that did not include the full right of alienation or that the reduction in price was consideration for conveyance of a reduced estate. The real estate contract that the parties signed indicated that the Albys considered the sale of the property to Lorri Brashler to be “in essence a gift to her.” Clerk’s Papers (CP) at 7. Indeed, Susan Alby’s own affidavit reflects that the property was sold to the Brashlers at a reduced price, not in exchange for agreeing to a lesser estate, but as a favor to Lorri Brashler. She stated that
[a]fter several discussions with LORRI about what she and her husband, LARRY R. BRASHLER, could afford to pay for the home, my husband GENE, and I decided that $15,000.00 was what LORRI and her husband could afford, even though we believed the property and home was of considerably greater valued [sic].
CP at 40. Susan Alby’s affidavit also suggests that the Albys placed the restraint on alienation into the contract and deed after having agreed with the Brashlers on a selling price. For the foregoing reasons, I believe that the sale of the property at a reduced price was not a bargained-for exchange in consideration for the conveyance of a reduced estate.
¶18 Susan Alby notes that the restraint imposed on the alienability of the property in this case was limited both in scope and duration because it was a restriction on mortgaging or encumbering only and expired upon the death of both of the grantors. However, this limitation effectively rendered the property unalienable during the life of the grantors. The duration of the restriction is unknown; it could be *377a significant period of time, depending on Susan Alby’s longevity.6 During this period, the Brashlers would effectively be relegated to the status of leaseholders of the property, with the right of possession only. Furthermore, the restriction “runs with the land” and therefore limits the rights of not only the Brashlers, the immediate purchasers of the property, but all subsequent purchasers, for the lifetime of the grantor.
¶19 The utility of maintaining property in family ownership has been viewed in the law as subordinate to the value of free alienability of property. 3 John A. Borron, Jr., Simes & Smith: The Law of Future Interests § 1117 (3d ed. 2004). The doctrine of restraint on alienation and other common law doctrines such as the rule against perpetuities arose, in large part, to ensure that the desire of individuals to retain ownership of property within their family did not harm the economic interests of the nation by destroying the free market for property. Id. Despite the long history of this principle, the majority asserts that “[flamily ownership is not always subordinated to immediate and free alienability.” Majority at 373. It cites no authority for this assertion, which dismisses the doctrine recognized in Simes & Smith that society has a stronger interest in the free alienability of property than in fostering family dynasties.
¶20 Maintaining the property within the Alby family no doubt has certain value, to Susan Alby individually and to her family. Continued ownership of the property would allow them to maintain possession over land to which they no doubt have an emotional attachment. However, allowing Susan Alby to limit the alienability of the property for the sole purpose of maintaining it in the Alby family has injurious consequences both to the Brashlers and to the general public. The Brashlers are deprived of their right to freely dispose of their property, a right recognized as being one of the “ ‘fundamental attribute [s] of property owner*378ship.’” Manufactured Hous. Cmtys., 142 Wn.2d at 364 (quoting Guimont, 121 Wn.2d at 595). Further, the property is effectively removed from the marketplace, causing economic consequences affecting society as a whole.
¶21 For the foregoing reasons, I would hold that the clause in the Alby/Brashler deed providing for automatic reversion of the property if it is mortgaged or encumbered during the life of either grantor is unreasonable and, therefore, void. Accordingly, I would reverse the Court of Appeals and remand to the superior court for reinstatement of the summary judgment in favor of Banc One.
Madsen and Bridge, JJ., concur with Alexander, C.J.

 Because there were cross motions for summary judgment, the parties essentially agreed that there are no material factual disputes.

 Over 14 years have elapsed since the relevant language was placed in the real estate contract and deed. Because Susan Alby is now only 66 years of age, the restriction, if not void, could be in effect for many more years.