For affirmance -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For reversal -- None. The opinion of the court was delivered by Haneman, J.
Plaintiff filed a complaint in the Chancery Division to quiet title to certain lands situate in Perth Amboy, title to which had been obtained by condemnation by Easton and Amboy Railroad Company (Easton). Defendants, the heirs and devisees of Mary Chapman, deceased, appeal from the resulting judgment declaring that the plaintiff has a fee simple absolute title.
The facts are as follows: Easton was created as a result of the merger of Bound Brook and Easton Railroad Company (Bound Brook), created by L. 1872, c. 110, p. 314, and Perth Amboy and Bound Brook Railroad Company, created by L. 1858, c. 119, p. 278. The merger was authorized
by L. 1872, c. 450, p. 1017, which provided, in part, that Easton "shall in all respects act and be governed by the laws now in force respecting the Bound Brook and Easton Railroad, as far as the same may be applicable." Easton was merged into Lehigh Valley Company of New Jersey (Lehigh) by agreement of consolidation filed in the office of the Secretary of State of New Jersey on July 29, 1903. Lehigh was subsequently merged into plaintiff Lehigh Valley Railroad Company by agreement effective January 1, 1950 and filed in the office of the Secretary of State of New Jersey.
By virtue of the power granted by the act of incorporation of Bound Brook (L. 1872, c. 110, p. 314) Easton surveyed and laid out a railroad route from the village of Bound Brook to Perth Amboy and filed a copy of said survey in the office of the Secretary of State. It was thereby disclosed that certain lands owned by Mary Chapman, situate in the City of Perth Amboy, were required for the construction of said railroad. Upon the inability of Easton and Chapman to agree for the purchase of said lands, Easton made an application to the Supreme Court of New Jersey on October 12, 1872, as provided by L. 1872, c. 110, section 8, for the appointment of commissioners to examine and appraise the said land and assess the damages of Chapman. The court thereupon appointed three commissioners by order dated October 20, 1872. Said order provided, in part:
"Whereupon, it being made to appear to me that neither the said company nor its agents could agree with the said Mary Chapman for the use or purchase of said required land, I did * * * [designate] as the time and place for the appointment by me of three * * * commissioners to examine and appraise the land and assess the damages of the said Mary Chapman pursuant to said acts; * * *.
On December 2, 1872 the above named commissioners made a report which, in part, reads:
"* * * we did thereupon * * * proceed to view and examine the said lands and premises mentioned and described in the said order and appointment, and to make a just and equitable estimate and appraisement of the value of the same, and assessment of damages to be paid by the Easton and Amboy Railroad Company for such lands and damages aforesaid; * * *
We, the said commissioners do report that the sum of two thousand and seven hundred dollars for the value of the lands aforesaid, and the sum of two hundred and seventy-four dollars & fifty cents for the damages aforesaid, be paid by the said The Easton and Amboy Railroad Company to the said Mary Chapman making together the sum of two thousand nine hundred and seventy-four dollars & fifty cents for said lands and damages aforesaid, and for all other damages which we, as commissioners as aforesaid are authorized to assess under and by virtue of the acts mentioned and referred to in the said order and appointment in which estimate is included the cost of making and maintaining unnecessary said lands." (Emphasis supplied)
Said report was duly filed in the County Clerk's office, Middlesex County, as provided by L. 1872, chapter 110, section 8.
Easton, having paid the amount so determined to be due to Chapman, entered into possession of the said lands and constructed a railroad thereon according to said survey. The lands have continued in the peaceable possession of either Easton, Lehigh or Lehigh Valley Railroad Company.
By agreement dated January 31, 1958, plaintiff, having abandoned the use of said land for its railroad purposes, entered into a contract with Fords Porcelain Works (Fords) for the sale thereof. The agreement of sale provided, inter alia, that in the event plaintiff's title to the premises proved to be unmarketable, the purchaser had the right to rescind the contract. The title insurance company to which Fords applied for title insurance questioned whether plaintiff had
an absolute fee simple title. Plaintiff thereupon filed this action to quiet title to the lands. Issue having been joined, plaintiff moved for a summary judgment, which was granted on June 7, 1960. Defendants appealed to the Appellate Division and this court certified the appeal on its own motion.
Plaintiff contends that it obtained a title in fee simple absolute by virtue of the above referred to condemnation proceedings. The defendants, on the other hand, contend that plaintiff obtained a title in fee simple determinable, conditioned upon the continuous use of the lands for railroad purposes, and that upon the abandonment by plaintiff of that use, fee simple title absolute automatically reverted to them as heirs and devisees of Mary Chapman.
Although numerous decisions appear in our state reports involving the title to realty of various railroad companies, this is the first time that we have been confronted with the direct question of whether a railroad obtained a fee simple absolute or a fee simple determinable title through condemnation.
At the outset it is appropriate that we repeat certain requirements for and distinctions in various titles which are qualified rather than absolute and certain basic rules of statutory construction. Those interests in real estate which are so qualified fall generally into one of three categories, i.e., (1) estates on limitation, (2) estates on condition, and (3) estates on conditional limitation.
An estate on limitation, sometimes referred to as a base fee, qualified fee, determinable fee, or fee simple defeasible, 4 Thompson on Real Property, § 2171, p. 708 (1940), Restatement of the Law of Property, § 43 (1936), is an estate in fee simple which automatically expires upon the occurrence of a given event. The original grantor retains a possibility of reverter upon the breach of the stated condition and his grantee may convey his estate but the latter's grantee takes title subject to the same conditions and imperfections which adhered to it originally. Thompson on Real Property, supra, p. 708; Restatement,
supra, § 23; Carpender v. New Brunswick, 135 N.J. Eq. 397 (Ch. 1944); Freeholders of the County of Cumberland v. Buck, 79 N.J. Eq. 472 (Ch. 1911). Such estate is ordinarily created by the use of words denoting duration of time such as "while," "during," "so long as" and the like, Freeholders of the County of Cumberland v. Buck, supra, although those or similar expressions are not an essential ...