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City of Paterson v. Schneider

Decided: August 11, 1954.

THE CITY OF PATERSON, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
ALBERT SCHNEIDER AND JACQUELINE SCHNEIDER, HIS WIFE, SCHNEIDER SILK MILLS, INC., AND ANNA SCHNEIDER, DEFENDANTS-APPELLANTS



Lloyd, Waesche and Haneman. The opinion of the court was delivered by Haneman, J.s.c. (temporarily assigned).

Haneman

Plaintiff herein filed a complaint under N.J.S. 2 A:62-1, 2 A:62-20. Said statutes read as follows:

"2 A:62-1. Any person in the peaceable possession of lands in this state and claiming ownership thereof, may, when his title thereto, or any part thereof, is denied or disputed, or any other person claims or is claimed to own the same, or any part thereof or interest therein, or to hold a lien or encumbrance thereon, and when no action is pending to enforce or test the validity of such title, claim or encumbrance, maintain an action in the superior court to settle the title to such lands and to clear up all doubts and disputes concerning the same."

"2 A:62-20. A person in the peaceable possession of lands in this state, claiming ownership thereof in fee simple under a deed therefor, or by or under descent or devise from the grantee thereof, which deed contains no covenants, conditions or agreements for the forfeiture and payment of money or penalties on breach thereof, or restrictions therein, may, when it is claimed or asserted by anyone that such lands are subject to covenants, conditions or agreements for the forfeiture and payment of money or penalties on breach thereof, or restrictions, contained in earlier deeds in the chain of title, and no action is pending to enforce or test the existence or validity of such covenants, conditions, agreements or restrictions, maintain an action in the superior court to settle the existence and validity thereof, and to clear up all doubts and disputes concerning the same."

The facts in connection herewith are as follows: In 1946 the Legislature of the State of New Jersey enacted a statute (R.S. 55:14 G -1), which provided for the construction of public housing. The plaintiff proceeded under this act to acquire the premises in question by an agreement with the then owners thereof and entered into a contract on June 10, 1947 for the construction, on said tract, of seven apartment houses, each seven stories in height, to accommodate 392 families. The construction was undertaken under the above cited statute and by virtue of an agreement with the State of New Jersey under which it agreed to contribute $1,392,000 and the plaintiff agreed to contribute $2,200,000 to the cost thereof. The land upon which this improvement was to be constructed is part of a large tract which, in 1927, was owned by a corporation known as the Chestnut Hill

Land Co. In that year the said tract was conveyed to another corporation known as Chestnut Hill Manor. The deed to Chestnut Hill Manor contained restrictive covenants which forbade, inter alia , the erection of buildings other than one-family dwellings costing $10,000 or more each, and provided for various set-backs from the street and sidewalk. Said restrictions were to expire after thirty years. By mesne conveyances the grantor of the City of Paterson acquired title to the property here involved. Plaintiff is obliged, by reason of the statute, to sell this project to private owners during the month of December 1954.

The plaintiff, at the time of the conveyance to it, had knowledge of the existence of the restrictive covenants, but upon the advice of its counsel determined to proceed with the improvement and construct the buildings in violation thereof.

At the time of the execution of the contract between the plaintiff and the State of New Jersey the former was obliged and did sign an indemnity agreement under which it agreed to save the State of New Jersey harmless from any and all damage resulting from a breach of said restrictive covenants.

The defendants are some of the owners of the balance of the lots in the tract encumbered by the restrictive covenants contained in the conveyance to Chestnut Hill Manor.

Much publicity through the press and public meetings was given to the intended construction by the plaintiff prior to its undertaking of the actual erection of the apartment houses. It is admitted by the defendants that they had actual knowledge of an intended violation prior to any actual violation by the plaintiff. They as well admit that they neither voiced any objection nor commenced any suit to enjoin the plaintiff from violating the restrictive covenants as aforesaid, and that their course of conduct in that respect would now bar and estop them from any relief in an affirmative suit seeking the enforcement of the restrictive covenants as against the plaintiff. The defendants do not, by way of affirmative defense, assert either the existence or validity of the restrictive covenants, nor do they seek their enforcement. They do, however,

seek to prevent the relief here sought by the plaintiff upon the theory (1) that since they are not affirmatively asserting any claim as against the plaintiff by reason of the restrictive covenants, the plaintiff has not met the statutory requirement to the ...


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