Supervisor of Assessments of Anne Arundel County v. Bay Ridge Properties, Inc.

• Decision Date: 07 November 1973
• Docket Number: No. 72,72
• Citation: 310 A.2d 773,270 Md. 216
• Parties: SUPERVISOR OF ASSESSMENTS OF ANNE ARUNDEL COUNTY v. BAY RIDGE PROPERTIES, INC.
• Court: Maryland Court of Appeals

Page 216

270 Md. 216

310 A.2d 773

SUPERVISOR OF ASSESSMENTS OF ANNE ARUNDEL COUNTY v. BAY RIDGE PROPERTIES, INC.

No. 72.

Court of Appeals of Maryland.

Nov. 7, 1973.

K. Donald Proctor, Asst. Atty. Gen. (Francis B. Burch, Atty. Gen., and E. Stephen Derby, Asst. Atty. Gen., Baltimore, on the brief), for appellant.

John A. Blondell, Glen Burnie, for appellee.

Argued before MURPHY, C. J., and BARNES, McWILLIAMS, SINGLEY, SMITH, DIGGES and LEVINE, JJ.

SINGLEY, Judge.

This is an appeal from an order of the Maryland Tax Court which abated and cancelled an assessment of $57,075.00, being approximately 60% of full cash value of $95,128.00, for State and Anne Arundel County tax purposes for the tax year 1972-73 imposed by the County's Supervisor of Assessments (the Supervisor) on 10.681 acres of land owned by Bay Ridge Properties, Inc. (Properties). ¹

Since 1968 Properties has been the owner and developer of Bay Ridge, a residential subdivision fronting on Severn River and Chesapeake Bay at the point where the River enters the Bay. In 1922, Bay Ridge Realty Corporation, a predecessor of Properties, acquired a 380-acre tract there, and later filed among the Land Records of Anne Arundel County four subdivision plats of the development, ultimately dividing the tract into some 1100 building lots, most of which are only 50 feet in width. As lots were sold, commencing in 1922, the conveyances of lots were made not by description, but by reference to the plats. A brief history of the development of Bay Ridge may be found in Simon Distrib. Corp. v. Bay Ridge Civic Ass'n, 207 Md. 472, 114 A.2d 829 (1955).

The subdivision plats clearly showed a roadway 50 feet in width which ran along the entire water front of the tract, at distances varying from some 50 to some 200 feet from the water. The area between the road and the water was in some places a beach at water level, in others a bluff as high as 12 feet overlooking the Bay. As lots were sold by the developer and its successors in title, some purchasers received deeds containing a specific grant of the right to use the strips between the road and the water for bathing, boating and fishing. In some instances, the developer covenanted, on its part, not to erect, or permit the erection of, dwellings, bathhouses or commercial buildings on the beaches and bluffs, but to allow the construction of boardwalks, observation pavilions and piers.

As a consequence, while bare legal title to the strips remained in Properties' predecessors, and later in Properties, ² for reasons later to be discussed, use of the area was restricted to owners of the lots, and Properties was precluded from making any disposition or gainful use of the area.

Relying on the fact that title to 380 of the 1100 lots at Bay Ridge was still held by Properties, ³ Anne Arundel County's Supervisor of Assessments, assuming that the beach area comprised 18.41 acres, assessed it at $98,380.00 for the tax year 1972-73. Properties protested, with the result that the area was recalculated at 16.294 acres, and the assessment was reduced to $87,070.00. A corresponding reduction was made for the tax year 1971-72. On appeal to the Appeal Tax Court of Anne Arundel County, this assessment was affirmed, and the Supervisor was instructed to assess the 16.294 acres as escaped property for the 1971-72, 1970-71 and 1969-70 tax years.

Properties then appealed to the Maryland Tax Court. There, the Supervisor accepted a new survey made for Properties, and reduced the area to 10.681 acres and the assessment to $57,075.00. ⁴ The Tax Court concluded that the beach area should not have been separately assessed, because its use was reserved exclusively to the lot owners, and that whatever value it may have had should have been reflected in the assessed value of the lots at Bay Ridge. In this appeal, the Supervisor of Assessments has challenged the result reached by the Tax Court with an argument which we find superficially persuasive, but entirely at variance with the realities of the situation.

The Supervisor argues that in the usual case, the existence of an easement may diminish the value of the servient estate, Macht v. Department of Assessments, 266 Md. 602, 614, 296 A.2d 162, 169 (1972), ⁵ and cases and authorities there cited. He progresses from this point to the contention that since 730 lots have been sold, there are 730 dominant estates, but that since 380 lots remain unsold, with easements for the use of the beach yet to be granted, a proportionate part of the assessed value must be attributed to the ownership which Properties holds and the correlative right to grant easements which Properties retains, with the consequence that there remains at least 380/1100 of assessable value, on which annual taxes should be paid by Properties. This argument is based on the notion that the easement does not become appurtenant to the unsold lots until they are conveyed to others.

The logic of such an argument is facially unassailable, but it overlooks two important principles. The first results from the recording of the subdivision plats. Judge Barnes, speaking for the Court in Steuart Transp. Co. v. Ashe, 269 Md. 74, 87-96, 304 A.2d 788, 796-801 (1973), carefully reviewed the decisions setting forth the rights which flow from the law applicable to uniform general plans of development of land and the enforcement of restrictions on the use of land, subject to a uniform general plan. In sum, our cases hold that whether a uniform general scheme or plan of development is intended is a question of fact, Scholtes v. McColgan, 184 Md. 480, 489, 41 A.2d 479, 483 (1945); that if such a scheme or plan is intended, restrictive covenants may be enforced in equity, McKenrick v. Savings Bank of Baltimore, 174 Md. 118, 128, 197 A. 580, 584-585 (1938); and that enforcement may be had by or against a grantee even though the restriction does not appear in his chain of title if it is a matter of public record, Gnau v. Kinlein, 217 Md. 43, 141 A.2d 492 (1958). See generally Turner v. Brocato,206 Md. 336, 111 A.2d 855 (1955). Cf. Klein v. Dove, 205 Md. 285, 291-296, 107 A.2d 82, 85-87 (1954).

Winson G. Gott, Jr., Esq., an expert witness for Properties, had prepared a report summarizing the results of his examination of the conveyances made by Properties' predecessors. The following is an excerpt from his report, introduced in evidence:

'Many of the deeds from Bay Ridge Realty (the original developer) contained the following: 'also together with the use of a beach 100 feet wide from low water mark running along and binding upon the Severn River or Chesapeake Bay from a line drawn northeasterly in extension of the southernmost line of Bagley's Path, as shown on a Plat of Bay Ridge, and extending in a northerly direction along the Severn River or Chesapeake Bay to a line northeasterly in extension of the southeastmost line of lot No. 9 in Section 3 as shown on the Plat of Bay Ridge', followed by this language 'neither the said beach nor the said streets or avenues are intended to be dedicated to public use, the fee simple title to the same hereby being reserved in the party of the first part, the mention of the same herein being for the purpose of description only, expressly reserving, however, to the party of the first part and its successors in the development of Bay Ridge the right to erect or permit to be erected any board walk, pier or boat house, also any pavilion or bath houses upon the aforesaid Beach for the use and privilege of the property owners of Bay Ridge'.

'Some of the deeds contained the following: 'The owner of this lot and his family shall have access and right of way to the Bay or Lakes at the nearest street end or right of way, for bathing, boating, fishing, etc(.) but no right to build piers, boat shelters or other buildings on the beach or in the water without written permission from the Company.'

'Many of the deeds conveying bay front lots contained the following language: 'And the said Grantor hereby covenants that it will not erect nor suffer to be erected any dwelling, bathhouse or building for commercial purposes, except a pier, observation pavilion or boardwalk or any or all of them on the strip of ground of the Grantor herein lying between the Bay Drive and the high water mark of the Chesapeake Bay opposite the property conveyed. This covenant shall run with the land in favor of the lot hereby conveyed and be binding on all subsequent owners and occupants of said strip of ground.' Some of the deeds did not made any reference to beach rights.'

As a result, we cannot agree with the notion that the easements remained in a state of suspended animation as regards the unsold lots, waiting to be activated by either the sale of the lots or by the execution and delivery of deeds of conveyance. It seems to us that by implication easements were intended to attach to the unsold lots as soon as the plats were recorded and the first lot was sold, because from that time on, there was no longer a unilateral option available to the developer to grant or withhold the easements. See Mullan v. Hochman, 157 Md. 213, 220-221, 145 A. 554, 557 (1929), where a similar rule was applied to the dedication of streets by the recording of a subdivision plat, subject only to acceptance by a municipality, a condition not here applicable; see also Atlantic Constr. Corp. v. Shadburn, 216 Md. 44, 139 A.2d 339 (1958).

The Supervisor's argument overlooks a second very significant fact. The combination of the grant of easements for the recreational use of the beach and the imposition of restrictions against disposition and improvements deprived the beach, as the servient estate, of whatever value it might otherwise have had. ⁶ What value it had become exclusively and permanently attached to the lots, sold or unsold, improved or unimproved. For a period of nearly 50 years, the beach has had no independent value of its own-a circumstance tacitly recognized by...