Real Property Law

In affirming, the Appellate Division emphasized that claimant's parcel was not a beneficiary of the 1950 covenant, and that the parties to that covenant had terminated it. The court then rejected the adverse possession and easement by prescription claims because claimant had not alleged hostility. The court concluded that the use of the western parcels was a matter of neighborly accommodation. Finally, the court rejected claimant's easement by estoppel argument for failure to establish any action taken in reliance on a representation that they held an easement.

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Adverse Possession Claim Against Governmental Land Upheld When Land Not Held for Governmental Purposes

Vaccaro v. Town of Islip NYLJ 3/13/20, p. 28, col. 5 AppDiv, Second Dept. (memorandum opinion)

In an action for a judgment declaring that plaintiff possessor acquired title by adverse possession, the town and county appealed from Supreme Court's grant of possessor's summary judgment motion. The Appellate Division affirmed, holding that the town and county did not hold the property for governmental purposes.

In 1993, possessor bought the subject lot and an adjacent lot from a seller who purported to own both lots. In fact, the county had acquired title to the subject lot in 1991 through a tax foreclosure proceeding. In 2001, the county conveyed the subject lot to the town with a deed restricting the use of the lot for "municipal purposes" and providing that if the town attempted to use the property for other than municipal purposes, or otherwise attempted to dispose of it, title would revert to the county. Possessor continued to use the lot; the town made no use of it. Possessor then brought this action to establish title by adverse possession, and Supreme Court granted summary judgment to possessor, concluding that he had met all of the statutory requirements.

In affirming, the Appellate Division rejected the argument by the town and the county that the lot was not subject to adverse possession because the town held the lot in a governmental capacity. The court acknowledged that the county was presumed to use the parcel for public use for three years after the tax sale, but held that the presumption expired in 1994. The court then held that the 2001 deed restriction did not establish that the property was subject to immunity from adverse possession in the absence of evidence that the town had dedicated the property to public use or had used the property for a public purpose. As a result, the possessor was entitled to summary judgment on his adverse possession claim.

Comment

When government stops using the land for any governmental purpose, courts deem the land held in a proprietary capacity, and therefore subject to adverse possession claims. For instance, in Albany Parking Servs. v. City of Albany, 3 A.D.3d 711 (2004), the Third Department affirmed the trial court's grant of summary judgment to an adverse possessor upon proof that the city had adopted an ordinance recognizing the closure of the portion of a public street subsequently occupied by the adverse possessor. Although the city maintained it had taken no action to enforce the ordinance, the court ruled that the subject property was now held in a proprietary capacity and susceptible to adverse possession.

Evidence that the government has offered the disputed property for sale establishes that the government no longer holds the property in a governmental capacity, and the property is therefore subject to adverse possession claims. In Monthie v. Boyle Rd. Assocs., 281 A.D.2d 15 (2001), the Second Department affirmed the trial court's denial of defendant developer's motion for summary judgment, holding that the property the developer purchased from a school district had been held in a proprietary capacity, and was thus subject to adverse possession claims from the time the school district first offered the property for sale. The school district had acquired a 48-acre parcel of land, using only a portion of the property to build an elementary school. While the school district still owned the remaining land, but after the district had offered it for sale, neighboring landowners allegedly occupied the remaining land for more than 10 years before the school district ultimately sold it to defendant developer pursuant to an offer notice that described the plot as "vacant land … no longer required for school purposes." When the developer demanded that the neighboring owners relinquish their continued enjoyment of the property, neighbors claimed title by adverse possession. The court rejected developer's contention that adverse possession could not be obtained against the school district, bur found triable issues of fact about whether neighbors had satisfied the elements necessary to sustain their adverse possession claims.

If the government simultaneously use property for governmental and revenue-raising purposes, the property is held in a governmental capacity and is not subject to adverse possession claims. In Gallo v. City of New York, 51 A.D.3d 630 (2008), the Second Department reversed the trial court's denial of the city's motion for summary judgment, holding that although the city had leased the subject property to various entities for commercial use, the property was nevertheless held in a governmental capacity for the essential public benefit of "monitoring leachate and the migration of landfill gas from the Fresh Kills Landfill."

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No Preliminary Injunction in Action to Declare Sale Contract Void

Berman v. T.R.G. Waterfront Lender LLC, NYLJ 3/20/20 AppDiv, Second Dept. (memorandum opinion)

In purchaser's action to rescind a contract for sale of real property, seller appealed from Supreme Court's grant of a pre-answer motion for a declaration that the sale contract was void. The Appellate Division reversed, holding that purchaser was not entitled to preliminary injunctive relief.

The sale contract gave purchaser a right to terminate if purchaser was dissatisfied with the property's condition, but to exercise that right, purchaser had to deliver written notice, together with Phase I and Phase II Environmental Site assessments by a specified date. The contract provided that time was of the essence with regard to delivery of the termination documents. Purchaser delivered a notice exercising the right to terminate, along with a Phase I assessment. Purchaser demanded return of his $100,000 down payment. Seller refused to return the down payment, contending that purchaser had not delivered the Phase II assessment within the contract's time frame. Purchaser then brought this action seeking return of the down payment, and sought a preliminary injunction against release of the down payment to seller. Supreme Court granted the preliminary injunction, and also directed return of the down payment to purchaser.

In reversing, the Appellate division noted that preliminary injunctions should not be granted when granting the injunction would give the moving party the ultimate relief to which it would be entitled after a final judgment. Here, by awarding the down payment to purchaser, Supreme Court had granted purchaser the ultimate relief purchaser sought. Moreover, the court noted that purchaser had not demonstrated the irreparable harm he would suffer in the absence of a preliminary injunction, because a money judgment against seller would provide redress for the alleged harm. The court also held that purchaser had not demonstrated a likelihood of success on the merits because he had not demonstrated that obtaining a Phase II assessment within the contract's time period was objectively impossible.