Smedley v. City of Waldron

• Decision Date: 21 August 1984
• Docket Number: No. 83-2222,83-2222
• Citation: 739 F.2d 399
• Parties: Harry H. SMEDLEY, Appellant, v. CITY OF WALDRON, Thomas Sawyer, Mayor, Waldron, Arkansas, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 399

739 F.2d 399

Harry H. SMEDLEY, Appellant, v. CITY OF WALDRON, Thomas Sawyer, Mayor, Waldron, Arkansas, Appellee.

No. 83-2222.

United States Court of Appeals Eighth Circuit.

Submitted May 14, 1984.

Decided July 27, 1984.

Rehearing Denied Aug. 21, 1984.

John R. Beasley, Bethell, Callaway, Robertson & Beasley, Fort Smith, Ark., for appellant.

David L. Rush, Walters & Rush, P.A., Greenwood, Ark., for appellee.

Before HEANEY, BRIGHT and JOHN R. GIBSON, Circuit Judges.

PER CURIAM.

In 1940, the City of Waldron, lacking funds to acquire a reservoir site, asked Hannah Smedley to donate land for that purpose. The governing agreement provided in part that:

5. The City of Waldron shall never sell, transfer, convey, lease, rent or otherwise dispose of the lands herein above described to other persons, firms, groups and/or corporations, except successors and/or assigns of itself, and if it attempts to do so, the lands immediately revert to Hannah Smedley and her heirs[.]

In 1977, Harry Smedley (Hannah Smedley's sole heir and devisee) sued unsuccessfully for reconveyance, arguing that the city had abandoned the land. In dismissing the complaint, the district court found that the city had not abandoned the reservoir; rather, it continuously maintained and used it as a reserve water supply.

In 1981, the city leased the oil and gas rights of the deeded land to Texas Oil and Gas Corporation. As a result, Harry Smedley brought this case, alleging that the city's lease of the mineral rights subjacent to the land violated paragraph 5 of the 1940 agreement. For relief, he demanded immediate reconveyance of the land and payment of all monies the city received under the lease. Both parties moved for summary judgment. The district court found that the agreement was an impermissible restraint on alienation and granted the city's motion for summary judgment. We reverse and remand for further proceedings.

Some Arkansas courts have disapproved restraints on alienation. See, e.g., First National Bank of Fort Smith v. Graham, 195 Ark. 586, 593, 113 S.W.2d 497 (1938); Letzkus v. Nothwang, 170 Ark. 403, 408, 279 S.W. 1006 (1926). The district court erred in failing to distinguish the case at bar from the authority on which it relied regarding the impropriety of restraints on alienation. The district court relied heavily on a student note, Note, Sligh v. Plair: Right of Entry: An Effective Method of Controlling Land Use?, 33 Ark.L.Rev. 755 (1980). The note criticized the Arkansas Supreme Court's decision in Sligh v. Plair, 263 Ark. 936, 569 S.W.2d 58 (1978), which held that, in a transaction between private parties, a grantor may not invoke his right of entry for breach of a condition in a deed if he has previously waived that right. Citing a prevailing trend in case law, the writer suggested that the court should instead have invalidated the conveyance as a restraint on alienation. Note, supra, at 762 n. 53.

However, the writer's logic and the cases he cites in support of his contention are distinguishable from the case at bar. When the grant is to a governmental unit for a public purpose, Arkansas courts have been reluctant to void the grant as impermissibly restraining alienation if doing so would flout the grantor's intent. One line of Arkansas cases, for example, approved disabling language in grants...