Doyle v. McNulty, 82-129-A

• Decision Date: 20 July 1984
• Docket Number: No. 82-129-A,82-129-A
• Citation: 478 A.2d 577
• Parties: Helen Wood DOYLE v. John W. McNULTY et al. ppeal.
• Court: Rhode Island Supreme Court

Page 577

478 A.2d 577

Helen Wood DOYLE v. John W. McNULTY et al.

No. 82-129-Appeal.

Supreme Court of Rhode Island.

July 20, 1984.

Paul M. Chappell, Dolbashian, Chappell, Chace & Forte, Portsmouth, for plaintiff.

Kathleen Managhan, Corcoran, Peckham & Hayes, P.C., Newport, for defendants.

OPINION

KELLEHER, Justice.

In 1925 Herder C. Wood (Wood) took title to two lots in Portsmouth, Rhode Island from the Narragansett Heights Realty Co. (the realty company). Wood held title to these two lots (which we shall hereinafter refer to as lots 20 and 21) as trustee for a Patrick Ashe and Wood's two daughters, Helen and Ruth.

The deed conveying these two lots from the realty company to Wood contained six restrictions. Five of them pertained to use of the land. They prohibited the sale or manufacture of intoxicating liquors, required the installation of flush toilets, required that all chimneys be made of brick, prohibited the building of anything other than a cottage or a dwelling, and prohibited stores of any kind.

Restriction number 4 has precipitated this litigation. It reads as follows:

"Should said grantee ever decide to sell said premises, said grantor shall have the prior right to purchase same on the basis of the same price paid by said grantee plus an amount equal to a sum which would accrue were the money invested at a reasonable rate of interest."

Later, in 1933, the realty company conveyed thirty-nine more lots of land directly to Helen and Ruth. These lots were not subject to the restrictions described in the 1925 deed. Patrick Ashe conveyed his interest in lots 20 and 21 to the sisters in 1941.

Having suffered financial setbacks during the Depression, Helen, by her own admission, never paid any of the taxes assessed on the Portsmouth property. Consequently, in 1948 the sisters and their spouses conveyed all their interest in the forty-one lots to Ruth and her husband, George Ensworth, as tenants by the entirety.

The 1948 conveyance contained the following language:

"The said premises being subject to certain restrictions contained in the deed of Narragansett Heights Realty Co., Inc. to Herder C. Wood, Trustee, dated November 25, A.D. 1925, recorded in said Land Evidence in Book 32 at p. 528."

Time marched on, and in 1977 Ruth, now a widow, agreed to sell to John McNulty and his wife for $65,000 thirty-seven of the thirty-nine lots she and her sister had acquired in 1933. When Helen, also a widow, learned that this transaction had been consummated, she initiated this litigation. In her complaint Helen claimed that the 1948 deed's reference to the 1925 restrictions bestowed upon her the right of refusal that had been retained by the realty company when it first conveyed lots 20 and 21 to her father as trustee.

At the time of the trial in June of 1980, Helen was eighty-seven years old, and her sister Ruth was eighty. Helen testified that in July 1948 when she and her spouse conveyed whatever interest they had in the forty-one lots to Ruth and her spouse, she was assured by Ruth that she would have the right of first refusal before any of the lots were sold to a third person.

Ruth, on the other hand, denied that any such promise had been made. She also explained that at one time she and her husband owned their own home in Westfield, Massachusetts, but at her father's urging gave up their home to take up residence in the family homestead occupied by her ailing father and Helen. Her father, because of the 1929 Depression, had suffered severe financial losses; matters had reached the point that the bank was threatening to foreclose the homestead's mortgage, so she and her husband paid all of the expenses involved in the maintenance and upkeep of the property. Ruth told the trial justice that sometime in 1948 Helen and her husband (the couple was married in 1947) not only signed away all of their interest in the Portsmouth property but also conveyed to Ruth whatever interest they had in the family homestead. Ruth was insistent that the first time she heard any talk of the right of first refusal was when her sister instituted this suit. The sisters agreed that Ruth had paid Helen $1,000 for conveying her interest in the family homestead but disagreed about what was paid for Helen's conveying her interest in the Portsmouth property. Ruth pointed out that because the 1938 hurricane damaged the Portsmouth parcel substantially, the family believed that the property was not worth much money. The 1948 conveyance, which had been prepared by a Newport attorney, was executed in Springfield, Massachusetts.

The trial justice described Helen as a credible witness and ruled that "on all the evidence," Ruth and her...