Anderson v. Marshall-Malaise Lumber Co., 6374.

• Decision Date: 07 December 1935
• Docket Number: No. 6374.,6374.
• Citation: 263 N.W. 721,66 N.D. 216
• Parties: ANDERSON et al. v. MARSHALL-MALAISE LUMBER CO. et al.
• Court: North Dakota Supreme Court

66 N.D. 216

263 N.W. 721

ANDERSON et al.

v.MARSHALL-MALAISE LUMBER CO. et al.

No. 6374.

Supreme Court of North Dakota.

Dec. 7, 1935.

Syllabus by the Court.

1. One owning the fee has the right to sell his land subject to such reservations or restrictions as to its future use and enjoyment as he may see fit to impose, provided they are not contrary to public policy. Whether the right to enforce such restrictions or reservations is personal to the grantor, or appurtenant to adjoining land of which he remains the owner, is a matter of fact to be determined from the wording of the restrictive provisions in the light of the circumstances attendant on the transaction.

2. The record is examined, and it is held, for reasons stated in the opinion, that the restriction in the instant case was for the benefit of adjoining land, of which the grantor remained the owner, and that the right to enforce the same is appurtenant to such land and passed to the grantees thereof.

Appeal from District Court, Mercer County; H. L. Berry, Judge.

Action by August Anderson and another against the Marshall-Malaise Lumber Company and another, to enjoin the erection of a building contrary to a restrictive agreement in a deed. From a judgment for defendants, plaintiffs appeal.

Judgment reversed, and judgment ordered for the plaintiffs.

John Moses, of Hazen, for appellants.

W. H. Esterly, of Beulah, for respondents.

NUESSLE, Judge.

This action was brought to enjoin the defendants from erecting and maintaining a certain frame building on defendant lumber company's lot in the village of Beulah, contrary to the restrictive provisions in said defendant's deed. The trial court found for the defendants. Judgment was entered accordingly, and the plaintiffs thereupon perfected this appeal.

The facts are substantially as follows: On February 13, 1926, the First State Bank of Beulah, a domestic banking corporation, owned lots 8 and 9, in block 10, in the village of Beulah. Lot 8 was a corner lot with a frontage of 25 feet on the south, and extended north 130 feet to an alley. Lot 9 adjoined it on the east. The bank conducted its business in a frame building located on the southwest portion of lot 8. The remainder of the property was unoccupied. The defendant lumber company was engaged in the lumber and hardware business. Its business was carried on on the lots north of and across the alley from lots 8 and 9. The lumber company contemplated the erection of a building to be used for its hardware business. It desired to have a south and west frontage contiguous to the lots it already owned. So it bought from the bank lot 9 and a portion of lot 8, consisting of the north 40 feet of lot 8 and a strip 1 1/2 feet wide along lot 9 on the east side of the south 90 feet of lot 8. Thus the bank remained the owner of the southwest portion of lot 8, with a frontage of 23 1/2 feet on the south and a depth of 90 feet. The bank gave its warranty deed to the defendant lumber company for the property thus conveyed. This deed granted, bargained, sold, and conveyed to the lumber company, its successors, heirs, and assigns, the real estate in question, “To have and to hold the same, together with all the hereditaments and appurtenances thereunto belonging or in anywise appertaining unto the said parties of the second part, its successors, heirs and assigns, forever. And the said First State Bank of Beulah, party of the first part, for itself, its successors or assigns, does covenant with the said parties of the second part, its successors, heirs and assigns, that it is well seized in fee of the lands and premises aforesaid, and has good right to sell and convey the same in manner and form aforesaid; that the same are free from all incumbrances, provided, however, that no structure of any kind shall be erected on said premises unless the same be fireproof, walls to be of such material as brick, tile, concrete or cement, and provided further, that the west and south wall of any such structure shall be a party wall, and the party of the first part shall have the right to use the same as such, should it so desire.” The deed was placed of record by the defendant lumber company, which entered into possession of the property.

Thereafter the bank became insolvent. In 1927, the plaintiffs purchased that part of lot 8 owned by the bank from the receiver and took a warranty deed therefor. While this deed made no reference to the restrictions in the deed to the lumber company, the plaintiffs were apprised thereof and of the restrictive provisions contained therein. The plaintiffs entered into possession and occupancy of the premises so bought.

In 1934, the defendant lumber company began the erection of a frame building on lot 9. Plaintiffs protested, but the lumber company persisted. Thereupon the plaintiffs brought the instant action to enjoin the erection of such building. No temporary order was prayed for, as the parties agreed that suit might be brought and the matter litigated just as though such an order had issued. The defendant Goetz is interested in the suit as a lessee from the lumber company.

The plaintiffs contend that the restriction contained in the deed was for the benefit of that portion of the property retained by the grantor bank; that therefore it runs with the land and, as grantees of the bank, they are entitled to enforce compliance with its terms as against the defendant lumber company or any one claiming under it. On the other hand, the defendants insist that the restriction in question was personal to the bank; that it does not run with the land; and that accordingly the plaintiffs, as grantees of the bank, cannot enforce it.

The statute, North Dakota Compiled Laws of 1913, dealing with the transfer of obligations, provides:

Ҥ 5785. Certain covenants contained in grants of estates in real property are appurtenant to such estates and pass with them so as to bind the assigns of the covenantor and to vest in the assigns of the covenantee in the same manner as if they had personally entered into them. Such covenants are said to run with the land.

§ 5786. The only covenants which run with the land are those specified in this article and those which are incidental thereto.

§ 5787. Every covenant contained in a grant of an estate in real property which is made for the direct benefit of the property or some part of it then in existence runs with the land.

§ 5788. The last section includes covenants of warranty, for quiet enjoyment or for further assurance on the part of a grantor and covenants for the payment of rent, or of taxes or assessments upon the land on the part of a grantee.

§ 5789. A covenant for the addition of some new thing to real property, or for the direct benefit of some part of the property not then in existence or annexed thereto, when contained in a grant of an estate in such property and made by the covenantor expressly for his assigns or to the assigns of the covenantee runs with the land so far only as the assigns thus...