Riggs v. . Pursell , 66 N.Y. 193 ( 1876 )

The agreement between Kearney and Macomb and wife reserved a strip of land, seven feet and six inches in width, along the northerly side of the lots on Twenty-second street, "to remain and be enjoyed as a court-yard in front of any houses to be erected on said lots;" and, at the time of the sale, a perpetual injunction had been granted by the Supreme Court restraining the defendants, in the action brought, from excavating or building upon the same, or using it otherwise than as a court-yard.

It is insisted that this is an incumbrance upon the premises which justified the purchasers in refusing to take title. Conceding that the purchasers were obligated to take notice of the covenants in the lease, it does not necessarily follow that they were bound by the terms of the agreement in question, without notice of its contents. It is urged that they had knowledge, and there is evidence to show that the houses on Twenty-second street were constructed on the court-yard line. This circumstance may have been the subject of observation, but it does not prove that the purchasers had knowledge that the actual title to the land was not beyond the court-yard line, and the extent of their knowledge is by no means certain or definite. There is also proof that one of the purchasers was employed in superintending the putting down of the grating in said court-yard, but this may have been done without actual knowledge of the real situation of this portion of the premises; nor does it necessarily follow because there was a court-yard that the same was not held under the lease, without any restriction or reservation. It is also shown that one of the parties stated that he knew all about the dispute in reference to the court-yard. This is positively denied; and as evidence of declarations are always to be regarded with great caution, it is by no means satisfactorily established that the purchasers had full and accurate knowledge of the character of the conditions referred to. A serious question is therefore presented, whether, under the circumstances, the purchasers were bound to accept a conveyance; and where no notice is given by the terms of the sale, or otherwise, to direct the attention of bidders upon a sale to a condition contained in another agreement, and there is no direct proof of knowledge of such a condition, I think it cannot be fairly insisted that the purchasers had knowledge of the nature, character and extent of such restriction, and that the proof does not sufficiently establish such fact. The General Term, without disposing of the question discussed, held that, as the judgment in the case of Clark v. The New York LifeInsurance and Trust Company^* had been reversed, this objection must fail.

The court were clearly in error as to the decision of the Court of Appeals, as that court reaffirmed the decision of the Special Term, which held that the restriction did apply to the lot on Twenty-second street, distant ninety-six feet and one inch from Broadway. This leaves some twenty-six feet subject to the restriction, and constitutes a serious objection to the title. It clearly comes within the rule laid down, that where real estate is sold under a decree of the court, it will not compel the purchaser to complete his purchase where he will not obtain such an interest as he had a right to suppose from the terms of the sale he was buying when the property was struck off. (Seaman v. Hicks, 8 Paige, 655.) This rule is applicable to a sale of leasehold premises as well as the sale of a fee, and the same right exists in both cases to demand a good title to the interest agreed to be sold. (Burwell v. Jackson,9 N.Y., 535; Boyd v. Schlesinger, 59 id., 301.)

The existence of a court-yard, without the right to build thereon, is an incumbrance, or such a defect of title as justifies the purchaser in refusing to fulfil when he has no knowledge of that fact, and can obtain none by the inspection of the lease itself; and the case of Banks v. Walker (3 Barb. Ch., 438), cited by respondents' counsel, is not antagonistic to this view of the subject. The publication of the notice of sale, referring to the lease, did not bind the purchasers to look beyond this, nor furnish sufficient knowledge to put them upon inquiry as to an instrument outside of the lease, and for this reason they are entitled to be relieved from their bid at the sale.

Upon the ground stated, and without considering the other objections urged, my opinion is that the orders of the Special and General Term should be reversed, and an order entered granting the application of the purchasers, with costs, and denying the motion of plaintiffs, with costs.

All concur with EARL, J., except CHURCH, Ch. J., not voting, and MILLER, J., dissenting. FOLGER, J., absent.

Order affirmed.

^* 64 N.Y., 33.