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The Stranger to the Deed Rule
In 1987, a unanimous Court of Appeals reaffirmed the vitality of the "stranger to the deed" rule, which holds that if a grantor executes a deed to a grantee purporting to create an easement in a third party, the easement is invalid. Estate of Thompson v. Wade, 69 NY2d 570. In justifying the rule despite its obvious frustration of the parties' intention, the court emphasized that grantors can readily avoid frustration of intent by arranging a direct conveyance to the intended beneficiary of the easement. Daniello v. Wagner, 2023 WL 8245882, decided by the Second Department on November 29th, makes it clear that not all grantors (or their lawyers) have received the Court of Appeals' message, suggesting that the rule needs re-examination.
The Daniello case involved two neighboring Montauk parcels originally owned by Paley. In 1974, Paley conveyed one of the parcels to Neimanis, who built a driveway that encroached on Paley's retained land. Then, in 1989, Paley conveyed the retained land to Brancaccio and Boland, subject to an easement in favor of Paley "to use and maintain as part of a driveway and for no other purpose the existing driveway." The 247-square-foot dimensions of the easement were described by metes and bounds. Note that this deed was executed two years after the Court of Appeals decision in Estate of Thompson v. Wade. When Brancato and Boland conveyed their parcel to Wagner in 2005, the deed was expressly made subject to the same easement in favor of Neimanis' parcel. The Daniellos bought Neimanis' parcel in 2018 and renovated the driveway, replacing retaining walls and adding new ones. When a dispute arose over the renovations and the Daniellos' use of the driveway for parking, the Daniellos brought a declaratory judgment action to establish that they had both a deeded and a prescriptive easement over the disputed driveway area. Supreme Court granted summary judgment to the Daniellos on their claim to a deed easement, but denied summary judgment dismissing Wagner's counterclaim seeking injunction against parking on the easement. Both parties appealed.
The Second Department started by indicating that Supreme Court had erred in concluding that the Daniellos had acquired a deeded easement to the driveway area. The court invoked the stranger to the deed rule, citing Estate of Thompson v. Wade.
'Huguenot LLC v. Megalith Capital Group Fund I, L.P.': A Tutorial On Contract Liability for Real Estate Purchasers
In June 2024, the First Department decided Huguenot LLC v. Megalith Capital Group Fund I, L.P., which resolved a question of liability for a group of condominium apartment buyers and in so doing, touched on a wide range of issues about how contracts can obligate purchasers of real property.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
CoStar Wins Injunction for Breach-of-Contract Damages In CRE Database Access Lawsuit
Latham & Watkins helped the largest U.S. commercial real estate research company prevail in a breach-of-contract dispute in District of Columbia federal court.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.