Court Opinion

ID: 9663139
Source: CourtListenerOpinion
Date Created: 2023-08-23 23:29:07.366258+00
Date Added: 2024-06-11T18:14:46.024369
License: Public Domain

WUEST, Chief Justice
(dissenting).
I dissent.
The majority opinion omits the issue on appeal. The complaint seeking declaratory relief prayed:
[TJhat the Court enter judgment declaring that the restrictive covenants in the contract for deed are personal in nature and do not run with the land or in any way affect a subsequent purchaser; or, in the alternative, that the Court enter a judgment declaring the uses which a motel existing on adjacent property may make of the property in dispute without violating the restriction.... (emphasis added).
The majority omits and ignores the underscored portion of the prayer for declarative relief. The judgment entered by the trial court provided:
The restrictive covenants ... will not run with the land being purchased under the contract or in any way affect a subsequent purchaser of the legal title to such property.
Obviously, the judgment parroted the prayer for relief. Appellant’s have not appealed from that portion of the judgment holding the covenants do not run with the land. They do appeal from that portion of the judgment which holds the covenants will not “in any way affect a subsequent purchaser [.]”
Where a restrictive covenant does not touch and concern the land, it has been said to be personal as between the parties and may not be enforced by or against anyone other than the original parties to the covenant. Since it was early recognized that such rigid limitations on the use of restrictive covenants could produce harsh results, courts of equity have long been enforcing personal restrictions where to do otherwise *892produce inequitable results. Such enforcement of restrictive covenants has been termed the doctrine of Tulk v. Moxhay, 2 Phil.Ch. 774, 41 Eng.Rep. 1143 (Ch. 1848).
Tulk v. Moxhay established the rule that equity will enforce a covenant against all subsequent purchasers with notice, independently of the question of whether it runs with the land. The equitable restriction binds a subsequent purchaser who has acquired an interest with notice of the original promise.
It is said that, the covenant being one which does not run with the land, this Court cannot enforce it; but the question is, not whether the covenant runs with the land, but whether a party shall be permitted to use the land in a manner inconsistent with the contract entered into by his vendor, and with notice of which he purchased. Of course, the price would be affected by the covenant, and nothing could be more inequitable than that the original purchaser should be able to sell the property the next day for a greater price, in consideration of the assignee being allowed to escape from liability which he had himself undertaken.
Tulk v. Moxhay, supra. The doctrine of Tulk v. Moxhay has been readily invoked to hold that one who purchases land knowingly, knowing it is subject to a restriction, will be bound by that restriction, even though it is personal and does not touch and concern the land. Carneal v. Kendig, 196 Va. 605, 85 S.E.2d 235 (1955); Oliver v. Hewitt, 191 Va. 163, 60 S.E.2d 1 (1950). It is clear that the burden of such restrictions may be enforced against purchasers with notice. 7 Thompson, On Real Property, 1962 Replacement, § 3165; 3 Tiffany, Real Property, § 861 (1939 & 1986 Supp.) The courts have been consistent in enforcing the burden of these restrictions against takers of the burdened land who have notice. Oliver v. Hewitt, supra, note 10; Messett v. Cowell, 194 Wash. 646, 79 P.2d 337 (1938); Rubel Bros., Inc. v. Dumont Coal & Ice Co., 110 Misc. 32, 180 N.Y.Supp. 662 (S.Ct.1920); Langenback v. Mays, 207 Ga. 156, 60 S.E.2d 240 (1950); Raney v. Tompkins, 197 Md. 98, 78 A.2d 183 (1951).
In Hewitt, supra, the court viewed the restriction as a personal covenant for the Vendor’s sole benefit as distinguished from a covenant that runs with the land. The court stated that:
This personal covenant is, however, binding between the original parties, both at law and in equity, specifically stated, it falls within that class of covenants which at law bind only the original parties as it does not run with the land; but, in equity, one is bound by such a personal restrictive covenant even though it does not run with the land if he takes title with knowledge of its existence, even though the deed to him did not recite the restriction.
Equity regards such an agreement as vesting in the promisee a right to specific enforcement not only as against the original promisor, but also against a subsequent holder of the property, if not a purchaser for value without notice. Doo v. Packwood, 265 Cal.App.2d 752, 71 Cal.Rptr. 477 (1968); Jackson v. Richards, 26 Del.Ch. 260, 27 A.2d 857 (1942); Hecht v. Stephens, 204 Kan. 559, 464 P.2d 258 (1970); Coomes v. Aero Theatre & Shopping Center, Inc., 207 Md. 432, 114 A.2d 631 (1955); Mid-State Equipment Co., Inc. v. Bell, 217 Va. 133, 225 S.E.2d 877 (1976). If the right to equitable relief could not be asserted against a subsequent holder of the property, the result would be that the promisee could be deprived of such right, in practically every case, by a collusive transfer on the part of the promisor.
In equity, the question of whether such a covenant runs with the land is material on the question of notice only, since, if it runs with the land, the purchaser is bound regardless of his knowledge of it, while if it does not so run, he is bound only if he took the land with notice of the covenant. Hercules Power Company v. Continental Can Co., 196 Va. 935, 86 S.E.2d 128, (1955); Queen City Park Assoc. v. Gale, 110 Vt. 110, 3 A.2d 529; Carneal v. Kendig, su*893pra; See 3 Tiffany, supra, § 858 (1939 & 1986 Supp.).
Although a promise may be unenforceable as a covenant at law it is clear that the promise may be enforced as an equitable servitude against the promisor or a subsequent taker who acquired the land with notice of restrictions on it. Hudson Oil Co., Inc. v. Shortstop, 111 Cal.App.3d 488, 168 Cal.Rptr. 801 (1980); Sun Oil Company v. Trent Auto Wash, Inc., 379 Mich. 182, 150 N.W.2d 818 (1967); Traficante v. Pope, 115 N.H. 356, 341 A.2d 782 (1975). The equitable servitude, however, is not automatic; it depends upon the equities between the promisee and the subsequent taker with notice. The use of equity to enforce covenants restricting the use of property is not absolute and the right may be lost by laches, waiver, acquiescence or other equitable defenses. Equitable enforcement may be denied when there has been a change in conditions so radical in nature as to neutralize the benefits of the restrictions and destroy their purpose. Several factors to be considered, but not as limitations, are: the purpose for which the restrictions were imposed, the location of the restriction violations, the type of violations which have occurred, and the unexpired term of the restrictions. McColm v. Stegman, 3 Kan.App.2d 416, 596 P.2d 167 (1979).
A declaratory judgment action was not the proper vehicle to determine the rights of subsequent grantees of Hyde. They were not parties to this proceeding, since they did not exist. It may be in some future equitable proceeding a court would hold that Liebelts have an equitable servitude on property acquired by Hyde’s subsequent grantee. On the other hand, the equities may have changed and the relief will be denied. As the Kansas Court said in McColm: “No hard and fast rule can be laid down as to when changed conditions have defeated the purpose of restrictions, and each must be decided on the equities of the situation presented.” 596 P.2d at 170.
The trial court in this case was asked to rule on motions for summary judgment in a declaratory judgment action. We have said motions for summary judgment are not ordinarily suitable in equitable actions. Wilson v. Great Northern Railway Co., 83 S.D. 207, 157 N.W.2d 19 (1968).
Although the trial court could determine the rights of Liebelts and Hyde, it could not rule on the rights of subsequent grantees. SDCL 21-24-7 provides:
When declaratory relief is sought all persons shall be made parties who have or claim any interest which would be affected by the declaration, and no declaration shall prejudice the rights of persons not parties to the proceeding.
We should reverse that part of the judgment which holds, “or in any way affect a subsequent purchaser of the legal title to such property.” Because it might.