Real Property Law

In affirming, the Appellate Division disagreed with Supreme Court's conclusion that development rights did not constitute “real property or a part thereof” within the meaning of RPAPL 1602. The court concluded that development rights were components of the bundle of rights that makeup real property. But the court then concluded that the son and the plaintiff sisters had not established that the proposed sale of development rights would be expedient. In particular, the court emphasized that the plaintiff siblings presented no evidence of a proposed buyer, and no evidence of the value of the property with and without the development rights. The court also noted that they presented no evidence that sale of the development rights was necessary to preserve the property. As a result, the court affirmed the Appellate Division's dismissal of the complaint.

COMMENT

Section 1602 of the Real Property Actions and Proceedings Law permits a holder of one or more possessory or future interests in real property to apply to the court for an order directing that the whole or a portion of the property be mortgaged, leased, or sold. RPAPL Section 1604 qualifies Section 1602, authorizing the court to grant the application so long as the application is expedient.

In most cases decided under section 1602, the applicant is a life tenant whose interest was acquired by will. Unless express language in the will establishes that testator did not want the property sold, courts generally grant the life tenant's application, even over the objection of remaindermen, especially if the life tenant is generating little benefit from the life estate. For instance, in In Matter of Gaffers, 254 A.D. 448, 450 , the court granted the life tenant the authority to sell a house when the house did not generate enough rent to cover taxes and maintenance. Similarly, in In Re Estate of Sauer, 194 Misc. 2d 634, 638, the court granted the life tenant's application to sell when the life tenant desired to relocate and the will provided that the life tenant could not be forced to sell his interest “until he so desires” — an indication that testator intended to give the life tenant control over sale. And in Matter of Strohe, 5 Misc.3d 1028(A), the court authorized sale by a life tenant who sought to use sale proceeds to help defray the cost of the his assisted living. Id. at *5-*6. The court emphasized the will testator's overall intent to benefit the life tenant and provide him with a reasonable residence for his lifetime. Id. at 5. In each of these cases, the remaindermen had objected to the sale.

But, if the testator's circumstances or the language of the will indicate that the testator did not want the property sold, courts will find the sale inexpedient even if retaining the property economically disadvantages the life tenant. In Matter of Talmage, 13 Misc. 3d 1205A, *7–8 (Sur. 2007) affirmed by In Re Talmage, 64 A.D. 3d 662, the court denied a petition by testator's wife, the life tenant, when testator's daughters by a prior marriage objected to the sale of property that formed part of a larger compound held by the family for more than a century. The court emphasized the efforts testator had made during his lifetime to avoid sale of the property, together with a provision in the will leaving the property to the wife only so long as she continues to live on the premises or until she remarries, whichever comes first. In denying the wife's application, the court emphasized the potential divesting conditions that distinguished the wife's interest from the ordinarily life estate.

No Obligation to Extend Party Wall Upward
145 W. 21st Realty LLC v. First West 21st Street LLC
NYLJ 7/13/17, p. 21, col. 2
Supreme Ct., N.Y. Cty
(Levy, J.)

In an action by landowner against neighbor for trespass, encroachment and negligence in construction of neighbors' building, neighbor sought summary judgment dismissing the complaint. The court granted neighbor's motion , holding that neighbor had no obligation to extend a party wall upward when neighbor built a new and taller building on its parcel.

Landowner owns a five-story residential building adjacent to neighbor's newly constructed 14-strory building (Chelsea Green). Before construction of Chelsea Green, the neighbors shared a party wall. When neighbor built Chelsea Green, neighbor did not use the party wall, but built its own wall exclusively on its own parcel, and then cantilevered the top floors of its building above the existing party wall. The cantilevered wall never encroached on landowner's parcel. Landowner's complaint, however, is that by building the new wall instead of using the party wall, neighbor made it impossible for landowner to extend the party wall upward in a way that maximized the available space on landowner's parcel.

In granting summary judgment to neighbor, the court held that a property owner who chooses not to use a party wall may use its own side of the wall for any purposes, so long as none of its structures impair the integrity of the wall or cross the property line. Although the neighbor in this case had a right to carry the party wall upward, the neighbor had no obligation to do so. Because none of Chelsea Green's structure encroached on landowner's parcel, Chelsea Green did not infringe on any of landowner's rights.

Questions of Fact About Location of Easement
Finster Inc. v. Albin
2017 WL 2976276, 7/13/17
AppDiv, Third Dept.
(Opinion by McCarthy, J.)

In landowner's action for a declaration that it owns a right of way over neighboring parcels at the location of an existing driveway, neighbors appealed from Supreme Court's award of summary judgment to landowner. The Appellate Division modified to deny the summary judgment motion, holding that questions of fact remained about the location of the easement.

Landowner acquired title to its property in 2007, and built a garage in 2008 on a portion of the property located in a former quarry. Because a steep grade separates the quarry area from the remainder of the property, landowner used a driveway over neighboring parcels to obtain access to the garage. Landowner's parcel and the neighboring parcels had earlier been owned by a single owner, and when that owner sold off the neighboring parcels, he reserved a right of way in favor of landowner's parcel “where said road or driveway now exists at or near same.” In 2012, a neighbor erected a gate preventing landowner from using the driveway, and landowner brought this action for a declaration that it owns a right of way across the neighboring parcel, either as a product of an express easement or an easement by necessity. Supreme Court awarded landowner a preliminary injunction, and the granted landowner summary judgment on the merits of the claim. Neighbors appealed.

The Appellate Division first agreed with Supreme Court that landowner had established the existence of an express easement by reference to the deeds expressly reserving the easement. But the Appellate Division then held that the deeds did not conclusively establish the location of the easement. Submissions by the respective parties placed the easement's location in doubt, and made summary judgment inappropriate.

Landowner Established Express Easement
Michel v. Baierwalter
NYLJ 6/28/17, p. 21, col. 3
Supreme Ct., Nassau Cty
(Feinman, J.)

In an action by landowner to enjoin neighbors' interference with an easement over their land, all parties moved for summary judgment. The court granted landowner's summary judgment motion, holding that landowner had established an express easement dating back to an 1853 deed.

Landowner's parcel abuts a path known as Shore Road. Neighbors' parcels also abut Shore Road. Landowner contends that the only access from her parcel to a public road is by traveling along Shore Road, and she sought a declaration that she has an easement to traverse Shore Road, and an injunction compelling neighbors to remove any obstructions to the easement.

In awarding summary judgment to landowner, the court relied on the affidavit of an expert who traced a unbroken chain of title reserving the right of way over Shore Road for the benefit of landowner's parcel to a recorded deed dating from 1853. The court held that neighbors had constructive notice of the easement, and that as a result of the express easement, it was unnecessary to consider landowner's claims to an easement by necessity or implication. In light of the easement, landowner was entitled to an injunction against obstruction of access.

Quiet Title Action Not Time-Barred
Fabtastic Abode, LLC v. Arcelia
NYLJ 8/18/17, p. 30, col. 3
AppDiv, Second Dept.
(memorandum opinion)

In an action by mortgagor's successor to quiet title, mortgagee appealed from Supreme Court's denial of its motion to dismiss the complaint as time-barred. The Appellate Division affirmed, holding that the action was timely.

In 1985, mortgagee's decedent transferred the subject property to mortgagor, taking back a purchase money mortgage that was to be repaid in installments through November 2005. Mortgagor defaulted in 1989, and mortgagee's decedent brought a foreclosure action. No judgment of foreclosure and sale was entered, but, in 1998, Supreme Court authorized mortgagee's decedent to take possession and manage the property in accordance with the terms of the mortgage. The mortgage itself assigned rents and profits derived from the premises to mortgagee until the mortgage was paid. In 2012, mortgagor's successor brought this action to quiet title, seeking a judgment that the mortgage was paid and that the successor had unencumbered title to the property. Mortgagee sought summary judgment dismissing the complaint as time-barred, and Supreme Court denied the motion. Mortgagee appealed.

In affirming, the Appellate Division held that the action was not one to discharge a mortgage on the ground that an action to enforce the mortgage is time-barred. As a result, RPAPL 1501(4) did not bar the action. The court then held that the action was not one to redeem a mortgage by making payment, so that CPLR 212(c) did not bar the action. As a result, the quiet title action was timely.

Failure to Provide Evidence That Sale of Rights Is Expedient
Hahn v. Hagar
NYLJ 7/21/17, p. 25, col. 5
AppDiv, Second Dept.
(Opinion by Connolly, J.)

In an action by life tenant and two remaindermen seeking authorization to sell the development rights to a farm, plaintiffs appealed from Supreme Court's dismissal of the complaint. The Appellate Division affirmed, concluding that the development rights were real property but that plaintiffs had not established that selling the rights would be expedient.

The parties to the action are all siblings. Their parents left a life estate in the family's 101-acre farm to their son for life, or for so long as he used the land for farming. Upon his death, or at the time he ceased farming the land, the property and its improvements would go to the son and his three sisters in equal shares. The son and two of his sisters became interested in preserving the property as farmland by selling some of the development rights associated with the farmland or placing a conservation easement on the farm. When the third sister objected, her siblings brought this action pursuant to RPAPL 1602 seeking a judgment enabling them to sell the development rights to the farm to preserve it as a farm, or enabling them to place a conservation easement on the farm. Supreme Court dismissed the action, concluding that relief under section 1602 was unavailable because development rights are not real property within the meaning of section 1602. The life tenant and the plaintiff sisters appealed.

In affirming, the Appellate Division disagreed with Supreme Court's conclusion that development rights did not constitute “real property or a part thereof” within the meaning of RPAPL 1602. The court concluded that development rights were components of the bundle of rights that makeup real property. But the court then concluded that the son and the plaintiff sisters had not established that the proposed sale of development rights would be expedient. In particular, the court emphasized that the plaintiff siblings presented no evidence of a proposed buyer, and no evidence of the value of the property with and without the development rights. The court also noted that they presented no evidence that sale of the development rights was necessary to preserve the property. As a result, the court affirmed the Appellate Division's dismissal of the complaint.

COMMENT

Section 1602 of the Real Property Actions and Proceedings Law permits a holder of one or more possessory or future interests in real property to apply to the court for an order directing that the whole or a portion of the property be mortgaged, leased, or sold. RPAPL Section 1604 qualifies Section 1602, authorizing the court to grant the application so long as the application is expedient.

In most cases decided under section 1602, the applicant is a life tenant whose interest was acquired by will. Unless express language in the will establishes that testator did not want the property sold, courts generally grant the life tenant's application, even over the objection of remaindermen, especially if the life tenant is generating little benefit from the life estate. For instance, in In Matter of Gaffers, 254 A.D. 448, 450 , the court granted the life tenant the authority to sell a house when the house did not generate enough rent to cover taxes and maintenance. Similarly, in In Re Estate of Sauer, 194 Misc. 2d 634, 638, the court granted the life tenant's application to sell when the life tenant desired to relocate and the will provided that the life tenant could not be forced to sell his interest “until he so desires” — an indication that testator intended to give the life tenant control over sale. And in Matter of Strohe, 5 Misc.3d 1028(A), the court authorized sale by a life tenant who sought to use sale proceeds to help defray the cost of the his assisted living. Id. at *5-*6. The court emphasized the will testator's overall intent to benefit the life tenant and provide him with a reasonable residence for his lifetime. Id. at 5. In each of these cases, the remaindermen had objected to the sale.

But, if the testator's circumstances or the language of the will indicate that the testator did not want the property sold, courts will find the sale inexpedient even if retaining the property economically disadvantages the life tenant. In Matter of Talmage, 13 Misc. 3d 1205A, *7–8 (Sur. 2007) affirmed by In Re Talmage, 64 A.D. 3d 662, the court denied a petition by testator's wife, the life tenant, when testator's daughters by a prior marriage objected to the sale of property that formed part of a larger compound held by the family for more than a century. The court emphasized the efforts testator had made during his lifetime to avoid sale of the property, together with a provision in the will leaving the property to the wife only so long as she continues to live on the premises or until she remarries, whichever comes first. In denying the wife's application, the court emphasized the potential divesting conditions that distinguished the wife's interest from the ordinarily life estate.

No Obligation to Extend Party Wall Upward
145 W. 21st Realty LLC v. First West 21st Street LLC
NYLJ 7/13/17, p. 21, col. 2
Supreme Ct., N.Y. Cty
(Levy, J.)

In an action by landowner against neighbor for trespass, encroachment and negligence in construction of neighbors' building, neighbor sought summary judgment dismissing the complaint. The court granted neighbor's motion , holding that neighbor had no obligation to extend a party wall upward when neighbor built a new and taller building on its parcel.

Landowner owns a five-story residential building adjacent to neighbor's newly constructed 14-strory building (Chelsea Green). Before construction of Chelsea Green, the neighbors shared a party wall. When neighbor built Chelsea Green, neighbor did not use the party wall, but built its own wall exclusively on its own parcel, and then cantilevered the top floors of its building above the existing party wall. The cantilevered wall never encroached on landowner's parcel. Landowner's complaint, however, is that by building the new wall instead of using the party wall, neighbor made it impossible for landowner to extend the party wall upward in a way that maximized the available space on landowner's parcel.

In granting summary judgment to neighbor, the court held that a property owner who chooses not to use a party wall may use its own side of the wall for any purposes, so long as none of its structures impair the integrity of the wall or cross the property line. Although the neighbor in this case had a right to carry the party wall upward, the neighbor had no obligation to do so. Because none of Chelsea Green's structure encroached on landowner's parcel, Chelsea Green did not infringe on any of landowner's rights.

Questions of Fact About Location of Easement
Finster Inc. v. Albin
2017 WL 2976276, 7/13/17
AppDiv, Third Dept.
(Opinion by McCarthy, J.)

In landowner's action for a declaration that it owns a right of way over neighboring parcels at the location of an existing driveway, neighbors appealed from Supreme Court's award of summary judgment to landowner. The Appellate Division modified to deny the summary judgment motion, holding that questions of fact remained about the location of the easement.

Landowner acquired title to its property in 2007, and built a garage in 2008 on a portion of the property located in a former quarry. Because a steep grade separates the quarry area from the remainder of the property, landowner used a driveway over neighboring parcels to obtain access to the garage. Landowner's parcel and the neighboring parcels had earlier been owned by a single owner, and when that owner sold off the neighboring parcels, he reserved a right of way in favor of landowner's parcel “where said road or driveway now exists at or near same.” In 2012, a neighbor erected a gate preventing landowner from using the driveway, and landowner brought this action for a declaration that it owns a right of way across the neighboring parcel, either as a product of an express easement or an easement by necessity. Supreme Court awarded landowner a preliminary injunction, and the granted landowner summary judgment on the merits of the claim. Neighbors appealed.

The Appellate Division first agreed with Supreme Court that landowner had established the existence of an express easement by reference to the deeds expressly reserving the easement. But the Appellate Division then held that the deeds did not conclusively establish the location of the easement. Submissions by the respective parties placed the easement's location in doubt, and made summary judgment inappropriate.

Landowner Established Express Easement
Michel v. Baierwalter
NYLJ 6/28/17, p. 21, col. 3
Supreme Ct., Nassau Cty
(Feinman, J.)

In an action by landowner to enjoin neighbors' interference with an easement over their land, all parties moved for summary judgment. The court granted landowner's summary judgment motion, holding that landowner had established an express easement dating back to an 1853 deed.

Landowner's parcel abuts a path known as Shore Road. Neighbors' parcels also abut Shore Road. Landowner contends that the only access from her parcel to a public road is by traveling along Shore Road, and she sought a declaration that she has an easement to traverse Shore Road, and an injunction compelling neighbors to remove any obstructions to the easement.

In awarding summary judgment to landowner, the court relied on the affidavit of an expert who traced a unbroken chain of title reserving the right of way over Shore Road for the benefit of landowner's parcel to a recorded deed dating from 1853. The court held that neighbors had constructive notice of the easement, and that as a result of the express easement, it was unnecessary to consider landowner's claims to an easement by necessity or implication. In light of the easement, landowner was entitled to an injunction against obstruction of access.

Quiet Title Action Not Time-Barred
Fabtastic Abode, LLC v. Arcelia
NYLJ 8/18/17, p. 30, col. 3
AppDiv, Second Dept.
(memorandum opinion)

In an action by mortgagor's successor to quiet title, mortgagee appealed from Supreme Court's denial of its motion to dismiss the complaint as time-barred. The Appellate Division affirmed, holding that the action was timely.

In 1985, mortgagee's decedent transferred the subject property to mortgagor, taking back a purchase money mortgage that was to be repaid in installments through November 2005. Mortgagor defaulted in 1989, and mortgagee's decedent brought a foreclosure action. No judgment of foreclosure and sale was entered, but, in 1998, Supreme Court authorized mortgagee's decedent to take possession and manage the property in accordance with the terms of the mortgage. The mortgage itself assigned rents and profits derived from the premises to mortgagee until the mortgage was paid. In 2012, mortgagor's successor brought this action to quiet title, seeking a judgment that the mortgage was paid and that the successor had unencumbered title to the property. Mortgagee sought summary judgment dismissing the complaint as time-barred, and Supreme Court denied the motion. Mortgagee appealed.

In affirming, the Appellate Division held that the action was not one to discharge a mortgage on the ground that an action to enforce the mortgage is time-barred. As a result, RPAPL 1501(4) did not bar the action. The court then held that the action was not one to redeem a mortgage by making payment, so that CPLR 212(c) did not bar the action. As a result, the quiet title action was timely.