Phillips v. Naff

• Decision Date: 06 March 1952
• Docket Number: No. 5,5
• Parties: PHILLIPS et ux. v. NAFF et ux.
• Court: Michigan Supreme Court

Page 158

52 N.W.2d 158

332 Mich. 389

PHILLIPS et ux. v. NAFF et ux.

No. 5.

Supreme Court of Michigan.

March 6, 1952.

Chas. F. Welsh, Bruce W. Daines, Detroit, for appellants.

Hand, Sullivan, Hull & Kiefer, Detroit, for appellees. Joseph A. Sullivan, John B. Kiefer, Willis M. Graves, John W. Roxborough, II, Detroit, of counsel.

Morris Zwerdling, Detroit, for Jewish Community Council of Detroit, Amicus Curiae. Solomon Bienenfeld, Weiswasser, Jaffe & Radner, Detroit, of counsel.

Before the Entire Bench.

CARR, Justice.

Plaintiffs instituted an action at law in the circuit court to recover damages for an alleged breach of a reciprocal racial restriction. The declaration filed alleged that they were the owners of lot 14 in City Heights subdivision embracing certain land in Highland Park, that the defendants were the owners of lot 15 adjoining plaintiffs' property, and that prior to March 4, 1941, the owners of 75% of the frontage of lots on Tennyson avenue in said subdivision, in the block bounded on the east by John R. street and on the west by Woodward avenue, entered into an agreement affecting their respective properties and containing the following provision: 'The use and occupancy of all lands subject hereto is hereby restricted to white persons of pure Caucasian race and no such lands and premises shall be occupied or used in whole or in part by any other than a white person of the Caucasian race save and except that any white person, whether as owner or tenant, may cmploy thereon persons who are not persons of pure Caucasian race and any persons so employed thereon as personal or domestic servants or as janitors, caretakers, or watchmen may be provided living quarters on the premises where so employed.'

It was further provided that the agreement should become effective when executed by the owners or purchasers of 75% of such frontage, and should continue in force and effect until the expiration of two years after the recording of an instrument in the office of the register of deeds of the county, executed by the owners of the property, altering the action taken. It was also stated that from the time to the effective date of the instrument, which was recorded March 4, 1941, the lands affected should be 'subject to the covenants, agreements and restrictions herein contained which shall run with the land.'

The exhibits to the declaration indicate that the respective owners of lots 14 and 15 executed the agreement. Plaintiffs obtained their property by conveyance recorded February 5, 1945, and the warranty deed under which defendants acquired their title was recorded December 18, 1943. Plaintiffs claimed that defendants violated the restrictions in question on or about March 11, 1950, by conveying lot 15 to persons of the Negro race and placing such purchasers in possession and occupancy.

Defendants filed a motion to dismiss the case on the ground that the facts alleged in the declaration did not entitle plaintiffs to recover the damages claimed. Following a hearing the trial court came to the conclusion that the action constituted an attempt to enforce indirectly a racial restrictive covenant, and in practical effect was repugnant to the 14th amendment to the Federal Constitution as construed by the Supreme Court of the United States in Shelley v. Kraemer (McGhee v. Sipes), 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161. The trial judge further indicated in the opinion filed by him that the parties to the agreement imposing the restriction relied on the rule recognized by the courts in this State, and elsewhere, prior to the decision in Shelley v. Kraemer, supra, and believed the equitable remedy by way of injunction would be available to restrain any breach of the covenant. On the theory that the parties were mistaken as to their antecedent and existing private legal rights, it was suggested that defendants might seek to have the agreement set aside in equity, or defend the law action on the ground of mistake, attention being directed in this regard to Stone v. Stone, 319 Mich. 194, 29 N.W.2d 271, 174 A.L.R. 1349. For the reasons indicated the motion to dismiss was granted, and plaintiffs have appealed from the order entered.

It is appellants' claim, as set forth in their declaration, that the reciprocal covenant in question here is of such nature as to run with the land, as expressly provided in the agreement executed by the lot owners. We do not understand that defendants challenge such claim. It finds support in numerous prior decisions of this Court, including Sanborn v. McLean, 233 Mich. 227, 206 N.W. 496, 60 A.L.R. 1212, where it was held that: 'A reciprocal negative easement runs with the land sold, is not personal to owners, but is operative upon the use of the land by any owner having actual or constructive notice thereof, passing its benefits and carrying its obligations to all purchasers of land subject to its affirmative or negative mandates.' (Syllabus, par. 2.) See, also, Malicke v. Milan, 320 Mich. 65, 77, 30 N.W.2d 440, 32 N.W.2d 353, 4 A.L.R.2d 1412. As before noted, neither plaintiffs nor defendants were parties to the agreement imposing the restrictions.

The specific question before the court in Shelley v. Kraemer, supra [334 U.S. 1, 68 S.Ct. 840], was whether judicial enforcement by State courts of covenants restricting the use or occupancy of real property to persons of the Caucasian race violated the equal protection clause of the 14th amendment. Pointing out that said amendment is directed against State action only, and is not applicable to private conduct, it was held that decrees and judgments of State courts for the enforcement of private agreements are, in effect, State action and thus within the scope of the inhibitory provision of the amendment. In reaching such conclusion, it was said, in part:

'It should be observed that these covenants do not seek to proscribe any particular use of the affected properties. Use of the properties for residential occupancy, as such, is not forbidden. The restrictions of these agreements, rather, are directed toward a designated class of persons and seek to determine who may and who may not own or make use of the properties for residential purposes. The excluded class is defined wholly in terms of race or color; 'simply that and nothing more.'

'It cannot be doubted that among the civil rights intended to be protected from discriminatory state action by the Fourteenth Amendment are the rights to acquire, enjoy, own and dispose of property. Equality in the enjoyment of property rights was regarded by the framers of that Amendment as an essential pre-condition to the realization of other basic civil rights and liberties which the Amendment was intended to guarantee. Thus, § 1978 of the Revised Statutes, derived from § 1 of the Civil Rights Act of 1866 [8 U.S.C.A. § 42] which was enacted by Congress while the Fourteenth Amendment was also under consideration, provides:

"All citizens of the United States shall have the same right, in every State and Territory, as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property.'

'This Court has given specific recognition to the same principle. Buchanan v. Warley, 1917, 245 U.S. 60, 38 S.Ct. 16, 62 L.Ed. 149.

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* * * 'Since the decision of this Court in the Civil Rights Cases, 1883, 109 U.S. 3, 3 S.Ct. 18, 27 L.Ed. 835, the principle has become firmly embedded in our constitutional law that the action inhibited by the first section of the Fourteenth Amendment is only such action as may fairly be said to be that of the States. That Amendment erects no shield against merely private conduct, however discriminatory or wrongful.

'We conclude, therefore, that the restrictive agreements standing alone cannot be regarded as a violation of any rights guaranteed to petitioners by the Fourteenth Amendment. So long as the purposes of those agreements are effectuated by voluntary adherence to their terms, it would appear clear that there has been no action by the State and the provisions of the Amendment have not been violated. Cf. Corrigan v. Buckley, supra [271 U.S. 323, 46 S.Ct. 521, 70 L.Ed. 969].

'But here there was more. These are cases in which the purposes of the agreements were secured only by judicial enforcement by state courts of the restrictive terms of the agreements. The respondents urge that judicial enforcement of private agreements does not amount to state action; or, in any event, the participation of the State is so attenuated in character as not to amount to state action within the meaning of the Fourteenth Amendment. Finally, it is suggested, even if the States in these cases may be deemed to have acted in the constitutional sense, their action did not deprive petitioners of rights guaranteed by the Fourteenth Amendment.

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'The enforcement of the restrictive agreements by the state courts in these cases was directed pursuant to the commonlaw policy of the States as formulated by those courts in earlier decisions. In the Missouri case, enforcement of the covenant was directed in the first instance by the highest court of the State after the trial court had determined the agreement to be invalid for want of the requisite number of signatures. In the Michigan case, the order of enforcement by the trial court was affirmed by the highest state court. The judicial action in each case bears the clear and unmistakable imprimatur of the State. We have noted that previous decisions of this Court have established the proposition that judicial action is not immunized from the operation of the Fourteenth Amendment simply because it is taken pursuant to the state's common-law policy. Nor is the Amendment ineffective simply because the particular pattern of discrimination, which the State has enforced, was defined initially by the terms of a private agreement. State action, as that phrase is understood for the purposes...