First Huntington Nat. Bank v. Gideon-Broh Realty Co.

• Decision Date: 01 February 1954
• Docket Number: 10561,GIDEON-BROH,Nos. 10560,s. 10560
• Parties: FIRST HUNTINGTON NAT. BANK et al. v.REALTY CO. FIRST HUNTINGTON NAT. BANK et al. v.REALTY CO. et al.
• Court: West Virginia Supreme Court

Page 675

79 S.E.2d 675

139 W.Va. 130

FIRST HUNTINGTON NAT. BANK et al. v. GIDEON-BROH REALTY CO.

FIRST HUNTINGTON NAT. BANK et al. v. GIDEON-BROH REALTY CO. et al.

Nos. 10560, 10561.

Supreme Court of Appeals of West Virginia.

Submitted Sept. 9, 1953.

Decided Dec. 18, 1953.

Dissenting Opinion Jan. 12, 1954.

Rehearing Denied Feb. 1, 1954.

Syllabus by the Court.

1. 'Parol evidence to contradict, add to, alter, enlarge, or explain a complete written agreement, which is clear and unambiguous, or to vary its legal effect, is inadmissible.' Shaffer v. Calvert Fire Insurance Co., 135 W.Va. 153, 62 S.E.2d 699.

2. A written instrument, denominated a 'deed', but which throughout makes reference to the 'term' of twenty-eight years, yearly 'rentals', and refers to the parties of the first part as 'lessors', and which provides that the payment of rentals, plus the additional payment of the sum of one dollar are conditions precedent to the passing to title is a lease for the term of twenty-eight years with an option to purchase at the end of the term.

3. An option to purchase at the end of a lease for the term of twenty-eight years, containing an option to purchase at the end of the term, is void as being in violation of the rule against perpetuities.

4. The doctrine of estoppel may not be invoked to prevent the application of the rule against perpetuities.

Campbell, McNeer & Woods, Selden S. McNeer, McDaniel Purcell, Huntington, for appellants.

Fitzpatrick, Marshall, Huddleston & Bolen, Jackson N. Huddleston, Huntington, for appellees.

BROWNING, Judge.

Plaintiffs, co-trustees under the will of Rufus Switzer, deceased, instituted these proceedings under Chapter 55, Article 13 of the West Virginia Code, seeking a declaration of rights and obligations of the parties hereto under a written instrument dated December 27, 1919. The trial court entered a decree in which it determined the instrument to be a lease with an option, in violation of the rule against perpetuities, and declared the defendants, assignees of Azel Meadows, to have no further right or interest in the property involved

The instrument covers four valuable lots, situate in the City of Huntington, upon which approximately $40,000.00 in improvements have been erected, the major portions by lessees in sublease agreement. The nature of the instrument is in dispute. The plaintiffs maintain that it is a lease with an option to purchase twenty-eight years subsequent to the execution thereof. The defendants assert that the instrument constituted a purchase and sale of the property, or at least was a contract of purchase by which equitable 'title' immediately passed, and by which the defendants would receive the legal title, if they complied with the terms of the instrument, at the end of the twenty-eight year period. The plaintiffs contend that the rule against perpetuities was violated whether the instrument is a lease with an option or a contract of purchase and sale with the legal title not vesting for a period of more than twenty-one years and the legal period of gestation. The defendants urge that the rule is not applicable, whether it be determined that the instrument constitutes a lease and option, or a contract of purchase and sale. We believe it necessary, to a proper consideration of the issues involved, to quote the instrument in its entirety, and we do so with the exception of the purely formal parts.

'This Deed, Made this the 27th day of December, 1919, by and between Rufus Switzer, and Emma B. Switzer, his wife, and F. F. McCullough, and Alice V. McCullough, his wife, parties of the first part, and Azel Meadows, party of the second part.

'Witnesseth: That the parties of the first part for and in consideration of the rents herein reserved and the covenants and agreements hereinafter contained, and by the said party of the second part, to be paid, and performed do hereby grant, demise and lease unto the said Azel Meadows, the following described real estate: All those certain lots, pieces or parcels of land, situate in the City of Huntington, Cabell County, West Virginia, known and designated on a certain map of the said City of Huntington, made by Rufus Cook, Surveyor, a lithograph copy of which was filed in the recorder's office of said County, on the 6th day of December, 1871, as Lots No. Eight (8), Nine (9), Eighteen (18), and Nineteen (19), in Block No. Sixty-Seven (67).

'To Have and to Hold the same together with the tenements, hereditaments and appurtenances thereunto belonging and appertaining unto the said Azel Meadows, party of the second part, for and during the full term of Twenty-Eight (28) years next ensuing from the 1st day of January, 1920, with the right to the said party of the second part, throughout the period of Twenty-Eight (28) years aforesaid, to make additions and all improvements on the buildings now erected on said lots as he may desire, or rebuild and in all respects to use and employ said lots of land as if he were the owner thereof in fee simple, throughout the term of Twenty-Eight (28) years, so long as any change made would not decrease the value thereof.

'And the Party of the Second Part further agrees to keep said buildings in as good repair as when received and to keep same in a sanitary condition at all times and conform with all laws and regulations of the State, County, and City now in force or hereafter adopted, and not to use said premises for any business whatsoever that may be construed to be a nuisance under the law. Any franchise from the City of Huntington for a switch to and over said leased premises shall be granted to and held in the name of said lessors.

'The Said Party of the Second Part yielding and paying therefor unto the said parties of the first part, yearly and every year during the period of Twenty-Eight (28) years aforesaid, the sum of Twelve Hundred ($1200.00) Dollars, payable in monthly installments of One Hundred ($100.00) Dollars each, payable in advance on the 1st day of each month thereafter, for and during the term of Twenty-Eight (28) years, the last payment being due on the 1st day of December, 1947, said payments to be made at the Huntington Banking & Trust Co., of Huntington, West Virginia. $75.00 of said rent to the said Rufus Switzer and $15.00 to said F. F. McCullough.

'The said Party of the Second Part doth hereby covenant and agree to and with the said parties of the first part as follows: viz: to well and truly pay the rent above reserved as above specified, to pay all taxes, assessments, including charges and assessments for streets, sidewalks, sewers or any other kind of improvements or repairs that may at any time during the term of Twenty-Eight (28) years aforesaid, be lawfully levied or assessed on or against said premises or any part thereof, by any public authority.

'The Party of the Second Part further agrees to keep the buildings on said premises insured in some reliable Fire Insurance Company in the amount equal to ninety (90) percent of the value of said buildings, and to deliver said insurance policy to the parties of the first part to be held in custody by them, the said insurance shall be renewed and kept in force at all times by the party of the second part, and in case that fire destroys said buildings in part or whole, the insurance received under said policy for said loss shall be applied to the expense of repairing or rebuilding said buildings and should there be a balance remaining after said repairs or rebuilding has been completed, it shall be delivered to the party of the second part, and in case said buildings are destroyed by fire or otherwise, the rent shall continue in force; Said Insurance Policy shall contain a loss payable clause, payable to the parties of the first part, as their interest appears of record.

'And the said taxes, assessments, charges and insurance shall be considered to be and are a part of the annual rental, in addition to the said Twelve Hundred ($1200.00) Dollars, under this lease, and the said parties of the first part in consideration thereof, and of the said annual payments do covenant to and with the said Azel Meadows, that at the expiration of said term of Twenty-Eight (28) years, upon the payment of one dollar, the said lots of land, and all the buildings thereon and franchises there unto belonging, and all privileges, hereditaments and appurtances, then thereon, situate or thereto pertaining or belonging shall pass in fee simple to and the title and absolute ownership thereto and thereof, in fee simple be vested in said Azel Meadows, free from any and every lien, encumberance or charge heretofore or hereafter suffered or permitted by the parties of the first part or by their predecessors in title or any or either of them, and that the said parties of the first part, shall and will make, sign, seal, acknowledge for record and deliver to the said Azel Meadows, an apt and proper deed, with covenants of general warranty conveying the said lot of land, together with said privileges, tenements, hereditaments and appurtenances, at the expiration of said term of Twenty-Eight (28) years to the said Azel Meadows, and all such further assurances or assurances of title as may by law be apt and requisite, to vest in the said Azel Meadows, the title and absolute and unqualified ownership in fee simple in and to said lot of land and the privileges, tenements, hereditaments, and appurtenances, thereunto belonging and affecting, provided that the payment of said rentals, taxes, assessments and charges shall have been made, and the payment of said rentals shall be a condition precedent to the execution and delivery of such deed, or the passing of title to said lots to the said Azel Meadows.

'And the Said Parties of the First Part covenant and agree upon the consideration aforesaid, to and with the said party of the second part, that he shall and may peacebly and quietly enjoy the aforesaid premises, with the said privileges,...