Goldmann, Freund and Foley. The opinion of the court was delivered by Freund, J.A.D.
Appellants appeal from a final judgment of the Superior Court, Chancery Division, requiring them to pay respondents, Hudson Trading Corporation (Hudson) and Frank Altomare, the value of the land upon which their homes are located determined as of January 1, 1960, or in the alternative, to remove the dwellings from the lands. The judgment also ordered appellants to pay mesne profits of 6% interest on the value of the land from January 1, 1960.
This appeal concerns two actions which were consolidated by order of the trial court. The action of the homeowners is to quiet the title to ten lots with the dwellings thereon and occupied by them in the Township of Woodbridge, N.J. (Woodbridge). The action of Hudson is an independent suit for possession of the lands and mesne profits.
On November 27, 1929 the land involved in the present proceeding -- at that time vacant -- was conveyed by two separate deeds from Danwil Developers, Inc. to El-Ka Holding Co., Inc. By deed of July 2, 1931 El-Ka Holding Co., Inc. conveyed the same land, together with other lands, to Harry Weintraub, the deed being recorded in the county clerk's office on July 23, 1931.
In December 1935 the unimproved land was sold to the Township of Woodbridge for unpaid tax arrearages. The certificate of sale was recorded in the county clerk's office. Subsequently, Woodbridge instituted foreclosure proceedings in our former Chancery Court in respect to the tax sale certificate. The parties to the proceeding were Woodbridge as complainant and Danwil Developers, Inc. as defendant. Thereafter, final decree was entered on February 5, 1941 and recorded in the county clerk's office.
In October 1952 Woodbridge conveyed the land to Parkway Gardens, Inc. (Parkway). The land was subdivided and developed by Parkway, which constructed single-family houses and made other improvements throughout the tract of land, including the installation of water, streets and sewers. During 1953 and 1954 Parkway sold the homes it had constructed to the appellants, or their predecessors in title, for between $10,000 and $11,000 each. The purchasers of these houses acquired their title by bargain and sale deed. They failed to have any independent legal advice, nor were they aware of the outstanding title of Harry Weintraub. It is admitted that, when Woodbridge conveyed the land to Parkway, the grantee's title searcher inadvertently overlooked the fact of Weintraub's record ownership of appellants' lands in the 1935 tax foreclosure proceeding.
On March 8, 1959 one of the property owners, Victor Wansel and his wife, conveyed their property to plaintiffs Theodorus Bron and his wife. Examination of their title disclosed the omission in the foreclosure proceeding of the outstanding Weintraub title. At Wansel's request, Woodbridge instituted a strict foreclosure action, pursuant to N.J.S.A. 54:5-86.1, for the purpose of barring the outstanding interest and right of redemption of Weintraub, his unknown heirs, devisees and personal representatives. Final judgment was entered in October 1959 providing for the final date of redemption on November 13, 1959.
In the interim, Hudson located the surviving heirs of Weintraub and negotiated the acquisition of their interest for $400.
Weintraub had died on March 15, 1933, intestate and unmarried, leaving him surviving as his only heirs at law two sisters, Bessie Sachs and Rose King. By deed dated November 10, 1959 Bessie Sachs and her husband conveyed to Hudson her undivided one-half interest in all the land set forth in the complaints. Rose King died testate on June 5, 1959. William King, her husband, as executor and trustee with a power of sale under her last will and testament, conveyed to Hudson the remaining undivided one-half interest in the same land. On November 8, 1960 William King conveyed to Hudson his right of curtesy in the land in which his wife had an undivided one-half interest. On November 12, 1959 Hudson conveyed to Frank Altomare an undivided one-quarter interest in the property. As noted, Hudson and Altomare seek, in their action, possession of the land and mesne profits.
The trial judge awarded judgment in favor of Hudson and Frank Altomare and found that even though Hudson acquired title to the property with knowledge of the circumstances, its acquisition "was not wrongful as such." He ruled that Hudson was entitled to the enhancement in the value of the land which had taken place over the years, as well as the improvements made prior to Hudson's deeds. With respect to mesne profits, the trial judge determined that Hudson was not entitled to any substantial amount of money. Instead, he awarded interest from January 1, 1960 to the date of payment "in lieu of any specific amount for mesne profits."
Appellants urge that the judgment should be reversed because the trial court, in weighing the equities, improperly directed them to remove their buildings from the land or pay the 1960 value of the land. Alternatively, they argue that if estoppel may not be invoked against the original record owner and his heirs ...