August 5, 2009
BRIAN T. MCGRATH AND STEPHANIE K. MCGRATH, PLAINTIFFS-APPELLANTS, CROSS-RESPONDENTS,
JEFFREY N. EDWARDS AND CYNTHIA EDWARDS, DEFENDANTS-RESPONDENTS. CROSS-APPELLANTS.
On appeal from Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-1684-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 20, 2009
Before Judges A. A. Rodríguez, Payne and Waugh.
Plaintiffs, Brian and Stephanie McGrath, appeal from a judgment entered on October 8, 2008, following a bench trial that was held to determine the scope of a restrictive covenant or easement placed on the land of plaintiffs' neighbors, defendants Jeffrey and Cynthia Edwards. The judgment provided in relevant part:
1. Plaintiffs' demands for a declaratory judgment that Defendants' home is in an "unauthorized location" and for equitable relief limiting landscaping in relation to the location of Defendants' home and drive are DENIED with prejudice.
2. There are no limitations on the use of the property presently designated Lot 7 Block 27, Borough of Bernardsville, Somerset County, New Jersey (the "servient estate"), arising from the easement, "Schedule B" and/or deed language at issue in this action . . . other than the specific limitations set forth in paragraphs three through five herein as to the "defined field" in Lot 7 Block 27 . . . . It shall be the obligation of the owners of the "defined field" in Lot 7 Block 27 (i.e., the "servient estate"), and their heirs, successors and assigns, to comply with said obligations.
3. Plaintiffs' demand in the Amended Complaint for the removal of and/or the prohibition of planting of all trees, shrubs, bushes, and the like in the "defined field" is DENIED with prejudice, except that anything planted in the "defined field" cannot exceed a height above an imaginary plane above the "defined field" located at an elevation of approximately 595-600 feet above mean sea level (defined as the ground level of Plaintiffs' current home on Lot 17 Block 27 facing the "defined field"). Any trees growing above the imaginary plane shall be trimmed or removed, at the discretion of the owners of the "defined field."
4. There are no limitations on fencing in, or at the boundaries of, the "defined field" except that such fencing must be consistent with natural growth of vegetation or agricultural uses.
5. No structures with a roof for occupancy by livestock, humans or machinery may be built in the "defined field." This prohibition does not preclude the fencing permitted in paragraph 4, above, or animal feeding cribs or watering troughs without roofs. No roads, swimming pools or tennis courts may be built in the "defined field."
6. Defendants' request for an equitable exception to paragraph 3, above, with respect to trees planted by Defendants in the Northwest corner of the "defined field" is DENIED with prejudice.
7. All requests for attorneys fees and costs are DENIED.
8. Defendants' request for sanctions is DENIED.
Defendants cross appeal from the judge's denial of sanctions sought as the result of the filing by plaintiffs of an allegedly frivolous summary judgment motion.
The facts of this matter follow. In or around 1997, David Kane and his wife purchased fifty-five acres of property in Bernardsville, consisting primarily of farmland and woods, with the intention of developing it for themselves or others. The property included a Tudor-style house on a flag lot with a rear view of adjoining fields and, in the distance, the Watchung Mountains. Shortly after the purchase of the property by the Kanes, they subdivided it so as to create new lot 7 block 27, an eight and one-half acre piece of property containing the Tudor house, and contracted to sell it to John and Linda Canavan. In connection with that sale, the Kanes agreed to place an easement on the remaining property as set forth on "Schedule B" that was appended to the deeds memorializing the subdivision of the property and its sale to the Canavans.
The deed to the Canavans stated that it conveyed the property Together with the right of the Grantee herein to enforce the sight restrictions set forth on Schedule B a[pp]ended hereto, against the Grantor, the current owner of Lot 7, Block 27, the lot upon which the restrictions are imposed, and which shall also be binding upon said Owner/Grantor, their heirs and assigns.
"Schedule B" was a site plan depicting the Kanes' property together with that to be conveyed to the Canavans. Lines were drawn on the plan at the rear of the Canavans' house, extending to the southeast from the sides of the house in a cone that covered land designated as "field" and ending in a wooded area. Inside the cone (referred to in the litigation as the "defined field") was written: "We will not build anything in this field and will protect view by only building off Douglas Ave. on the other side of slope not visible from his and her house." The plan also had marked upon it one rectangle, beyond the trees where the defined field stopped, but within its area, if the field were extended beyond the woods, which was marked: "Possible building of house not visible approved by Mr. Canavan." A second rectangle, slightly above the defined field, if extended, bore the legend: "Possible building of house approved by Mr. Canavan would be in view." As a final matter, a parcel of land off Douglass Avenue, a road depicted at the bottom of the site plan, was labeled: "Possible sale to Tuffnell 2-3 AC has been approved by Mr. Canavan."
In 2001, the Canavans sold their property to the McGraths, who extensively renovated the house, increasing its size to over 9,000 square feet, and landscaped the property, both by eliminating and adding trees and bushes. Brian McGrath testified at the trial of the matter that he discussed the sight easement with the Canavans at closing, but that he did not read Schedule B or seek a legal opinion as to its enforceability at that time.
After the Kanes' sale of property to the Canavans, they sold an additional piece of property to a family named Scott, and then sold the remaining forty acres, in 2002, to the Edwards. In the Fall of 2005, the Edwards commenced construction of a home of equivalent size to that of the McGraths, accessed from Post Kennel Road, not Douglas Avenue, and located outside the area of the defined field, but not within either of the rectangles marked on Schedule B as "approved by Mr. Canavan." Construction of the dwelling was almost complete at the time of trial in July 2008.
The McGraths did not object to the Edwards' construction at the outset. However, in or around Memorial Day, 2006, a dispute between the two families arose as the result of the Edwards' plan to plant trees along the property line adjoining the McGrath's residence and within the defined field. Eventually, the Edwards removed the majority of the trees to another location, but they left approximately seven in the northwest corner of the defined field. In a letter from the McGraths' lawyer, Robert Van Rensselaer, to the Edwards, dated September 8, 2006, the attorney stated his opinion that the Edwards were in violation of the sight restrictions set forth in the deeds conveying the properties
1. By the direct placement of numerous trees along the contiguous border of your and our clients' property and within a delineated area on Schedule B; and
2. By the location of your residence, presently under construction, within another field of view protected by the sight restrictions, instead of at or near the location specifically " . . . approved by Mr. Canavan . . ." on Schedule B.
While "refrain[ing] from seeking either a 'Stop Work Order' or injunctive relief at this time with respect to the construction of your residence," Van Rensselaer reserved the right to do so and urged the Edwards' lawyer to contact him to resolve the matters raised in the letter.
On November 6, 2006, irked at the lack of response by the Edwards, the McGraths filed suit seeking damages, the removal of the offending trees and shrubs, and attorneys' fees. The Edwards answered and filed a counterclaim seeking a declaratory judgment that (1) their planting of trees, shrubs, bushes and the like in the defined field did not violate any covenant or easement; (2) the sight easements and restrictions were ambiguous and unenforceable against them; (3) the easement had been extinguished by the McGraths' substantial enlargement and alteration of their home: (4) the McGraths were estopped by laches from enforcing the alleged easement against the construction of their home; (5) the easement was unenforceable insofar as it purported to restrict construction beyond the defined field; and (6) the easement restricted only the right to build a house in the defined field. In an amended complaint, filed on April 30, 2008, the McGraths sought a declaratory judgment that the Edwards' home was located on an unauthorized site; an order restricting "landscaping or building anything" beyond 200 feet from the Edwards' house or ten feet on either side of their driveway; an order requiring the removal of all trees, shrubs, bushes and the like that were in violation of the McGraths' sight easements; and attorneys' fees and costs.
On February 15, 2008, after the attorney for the McGraths conceded that he was not seeking money damages or an injunction requiring the Edwards to tear down their house, the judge granted summary judgment to the Edwards "dismissing all claims against Defendants for money damages and with respect to the location of Defendant's home, now under construction." The order memorializing this ruling stated:
The court has not ruled as to the scope of the easement or its application to the location of defendants' home as it may relate to any new improvements of the property within sight of plaintiffs' home.
As acknowledged by defense counsel, those issues will be addressed in a bench trial, which will be held in the Law Division.
On the heels of the court's order, on March 28, 2008, the McGraths sought summary judgment "declaring that defendants' house is located on an unauthorized site, and restricting defendant from landscaping or building anything beyond two hundred (200) feet from their house, or beyond ten (10) feet of either side of their driveway." Counsel for the Edwards sought the withdrawal of the motion as frivolous, pursuant to Rule 1:4-8(B)(1). The McGraths' attorney refused. Summary judgment was denied.
Trial occurred on July 7, 8 and 10, 2008. The McGraths called as witnesses Brian McGrath, Robert Van Rensselaer, David Kane, and Cynthia Edwards. At the conclusion of their testimony, the judge granted a motion by counsel for the Edwards, pursuant to Rule 4:40-1, for judgment in the Edwards' favor on the issue of whether their house was mislocated in violation of the easement. As a result of that ruling, the judge also declared to be "resolved" the issue of whether the Edwards were restricted, in landscaping their house, to a 200-foot area. The judge stated:
The McGraths do not have a remedy available to them, as a result of this case, restricting . . . anything the Edwards do in this entire 40-acre property to only 200 feet of their house, because that house is not in a location where it's not permitted to be, because the Plaintiffs didn't present evidence that there was any restriction of where they place their house contained in either the documents or through the intent of the parties that executed these documents.
The judge did not then resolve the issue of what the Edwards could or could not do in the defined field, which issue was the subject of further trial testimony by Brian McGrath, Jeffrey Edwards, and Cynthia Edwards. Additionally, extracts from the deposition transcript of John Canavan were introduced into the trial record.
At the conclusion of the trial, the judge orally ruled as set forth in the order reproduced at the beginning of this opinion. In essence, the judge limited the easement to the defined field, the use of which he declared had been restricted in order to preserve the McGraths' view of both the steeply sloping field within the cone set forth on Schedule B and the Watchung Mountains. While declaring that the field need not continue to be used for growing hay, as it had been used since the McGraths' purchase of their property, the judge limited its use to agricultural purposes, including the cultivation of other crops and grazing. To further protect the view, the judge limited the height of any plantings in the field, so that they could not extend above the level of the ground upon which the McGrath's home was built.*fn1 He required the removal of the trees obstructing the view at the northwest corner of the defined field. The judge additionally construed the prohibition of building within the defined field to encompass anything with a roof, but he permitted fencing suitable for agricultural uses and unroofed feed cribs and watering troughs as an accessory agricultural use.
At oral argument of this matter, counsel for the McGraths made certain concessions that have been summarized by counsel for the Edwards, without dispute, in the following terms:
At the argument, Plaintiffs first seemed to state that they no longer were seeking reversal of the Trial Court's Judgment (in paragraph 3) to the extent that it imposed height restrictions on any plantings in the defined "field" on Defendant's property. We note that, as a consequence of that concession, Plaintiffs also appear to have withdrawn the assertion that they have a right to see the field in its pristine, 1997 condition; moreover, it would appear to reduce any claim that their "view" would be impaired by fencing in the field.
Second, Plaintiffs seem to have withdrawn their demand that the judgment be reversed insofar as it determined that Defendants' home is in an "unauthorized" location (as set out in the ad damnum clause in the Amended Complaint and as denied in paragraph 1 of the Judgment). That concession could be understood to remove any claim for any restrictions on Defendants' property that were said to flow from the location of Defendants' home.
However, counsel noted, and objected to an alleged "new claim: a request for a declaratory judgment that Defendants' home is the only home permitted on Defendants' 40 acre property and that it may not be subdivided (although Defendants have no current intention to do so)."
We view the McGraths' appeal in the light of these comments, focusing our analysis on what is permissible within the designated field and whether the easement restricts the use of the property beyond that designated field. Having carefully reviewed Schedule B, we are satisfied that, contrary to the McGraths' position, the easement set forth thereon is ambiguous in its terms. Although the document contains the statement that "we will not build anything in this field," the document does not define what is meant by "build" or "anything" and it does not address in any fashion what other activities can occur in the designated area. Further, we read the restriction of construction on Douglass Avenue and the designation of the two other building sites as "approved by Mr. Canavan" to create an ambiguity as to the use of the property beyond the designated field. The question then becomes, how should these ambiguities be construed?
At the outset, we query the trial judge's determination to take testimony from the original grantor and grantee of the contested easement to determine the parties' original intent in circumstances in which neither retained an ownership interest in the properties involved in the dispute. We addressed this practice in Cooper River Plaza v. Briad Group, 359 N.J. Super. 518 (App. Div. 2003), stating in that decision:
An intention disguised by an ambiguity cannot bind a subsequent purchaser who, as the result of an absence of clarity in the instrument of conveyance, lacks notice of restrictions that the initial parties have attempted to place on the property being conveyed. A holding otherwise would be inconsistent with principles of contract law, which require sufficient definiteness of terms so that the performance required of each party can be ascertained with reasonable certainty, as well as knowledge of and acquiescence in the stated terms. Weichert Co. Realtors v. Ryan, 128 N.J. 427, 435 (1992). It would also undermine the central public policy underlying New Jersey's Recording Act: that "a buyer . . . of real property should be able to discover and evaluate all of the . . . restrictions on the property" from a review of the public record. Aldrich v. Schwartz, 258 N.J.
Super. 300, 307 (App. Div. 1992). See also N.J.S.A. 46:21-1. Cf. Palamarg Realty Co. v. Rehac, 80 N.J. 446, 453 (1979) (expressing the purpose of the Recording Act and holding that title issues should be resolved so as to effectuate that purpose). Consequently, testimony by the parties to the initial sale of Lot 5 as to their undisclosed intent in imposing the setback restriction is irrelevant to a resolution of the issues now presented. [Cooper River Plaza, supra, 359 N.J. Super. at 527-28.]
We reject the position of the trial judge that the Supreme Court's decision in Bubis v. Kassin, 184 N.J. 612 (2005), implicitly overrules Cooper River Plaza in this regard. In Bubis, a trial court heard testimony from the owner of the servient estate, two licensed professional planners, and the town's zoning code enforcement officer as to whether a sand berm topped with trees constituted a fourteen-foot fence that violated an 1887 restrictive covenant prohibiting the construction of fences higher than four feet on the servient estate. On appeal from a conclusion by the trial court that a fence had not been created and our affirmance of that conclusion, the Supreme Court reversed, construing the term fence to include natural formations such as a row of trees planted on a sandy elevation. In Bubis, the issue we addressed in Cooper River Plaza did not arise, because testimony was taken only as an aid in defining the term fence, not to establish original intent. For that reason, there was no discussion of Cooper River Plaza whatsoever in Bubis. We thus do not regard Bubis as impeding our adherence to the view of the law that we expressed in the Cooper River Plaza opinion.
We nonetheless conclude that no reversible error occurred as the result of the court's inquiry into the drafters' original intent, because the testimony thus elicited was consistent with the sensible and thoughtfully conceived outcome reached by the trial judge, which we affirm on legal grounds. Isko v. Planning Bd. of Tp. of Livingston, 51 N.J. 162, 175 (1968) (permitting affirmance on grounds different from those expressed by trial judge).
It is well established that:
Restrictions on the use to which land may be put are not favored in law because they impair alienability. They are always to be strictly construed, and courts will not aid one person to restrict another in the use of his land unless the right to restrict is made manifest and clear in the restrictive covenant.
Of course, the rule of strict construction will not be applied to defeat the obvious purpose of a restriction. . . . However, the meaning of a restrictive covenant will not be extended by implication and all doubts and ambiguities must be resolved in favor of the owner's unrestricted use of the land. [Bruno v. Hanna, 63 N.J. Super. 282, 285 (App. Div. 1960).]
As we noted in Cooper River Plaza: "This rule exists, not only because restrictions impair the public's right to alienate and fully use property, 'but also because restrictions, in the framing of which a subsequent purchaser has had no voice, ought to be so clear that by the acceptance of the deed that declares them he may reasonably be deemed to have understood and acceded to them.'" 359 N.J. Super. at 526 (quoting Fortesque v. Carroll, 76 N.J. Eq. 583, 586 (E. & A. 1909)).
We turn first to the uses of the designated field.
Although we have found the phraseology utilized in that connection to be ambiguous, we nonetheless recognize that the restriction has the obvious purpose of preserving, unobstructed, the view from the McGrath's property across the downwardly sloping field to the woods, and from thence to the Watchung Mountains in the distance. We further recognize the grantor's undertaking to "not build anything in this field." Consideration of these factors leads us to conclude that the trial judge did not err when he restricted the use of the designated field to farmland purposes, including the growing of crops and grazing, and when he barred from that area any structure with a roof, thereby preserving the rural character of the land and insuring that nothing would be constructed that would impair the McGrath's view.*fn2 We decline to consider a potential feed crib or water trough to be structures of such significance that they should be barred, as well, from the site. We do not address the judge's rulings with respect to the height of trees or the presence of fences required for agriculture or pasturage, finding the parties to have abandoned any arguments on those points.
We take a different approach with respect to other limitations potentially imposed as the result of the language of Schedule B. As we have stated previously, we find the designation of three sites outside of the designated field as "approved by Mr. Canavan" for house construction to be ambiguous in nature. Turning again to Cooper River Plaza, we noted in our decision in that case:
A restriction such as that found in the deed to Lot 5 [at issue there] is regarded in New Jersey as a contract, and its enforcement constitutes a contract right. See Assisted Living Assocs. of Moorestown, L.L.P. v. Moorestown Tp., 31 F. Supp.2d 389, 397 (D.N.J. 1998); Homann v. Torchinsky, 296 N.J. Super. 326, 334 (App. Div.), certif. denied, 149 N.J. 141 (1997). The restriction thus must be analyzed in accordance with the principles of contract interpretation, which include a determination of the intention of the parties as revealed by the language used by them. Ibid.; Union Co. Indus. Park v. Union Co. Park Com., 95 N.J. Super. 448, 452-53 (App. Div. 1967). However, as the cases that we have cited make clear, in the context of a deed restriction meant to bind subsequent purchasers that are strangers to the initial transaction, the intent of the restriction must manifest itself in the language of the document itself. If ambiguity remains, it cannot be resolved, as would be the case if the initial signatories disputed an ambiguous term, by resort to extrinsic evidence, as Cooper River suggests. [Cooper River Plaza, supra, 359 N.J. Super. at 527 (footnote omitted).]
In Cooper River Plaza, the deed conveying property in the Township of Pennsauken known as Lot 5 contained a restriction that stated: "No structure is to be erected on the premises adjacent to the premises forming the subject matter of this deed [Lot 4] forward of the present building line of the building presently situate on said adjacent premises." The deed further provided that in the event of a breach by the grantee of any of the deed's restrictions, conditions and covenants, Lot 5 would revert to the grantors upon application to the court. 359 N.J. Super. at 522-23. Thereafter, a Wendy's restaurant was built on Lot 4 that slightly violated the setback requirements set forth in the deed to Lot 5, since a three-foot triangle at the entrance to the restaurant was constructed in front of the original building line. Id. at 524. Reversion of the property was sought in a complaint by Cooper River Plaza against the owner of the Wendy's restaurant, Briad Group. By the time the complaint was served, the Wendy's restaurant was substantially completed. Id. at 524-25. Following discovery, the Briad Group moved for summary judgment, which was granted by the trial judge, who held that the deed restriction limiting the setback of any structure built on Lot 4 was ambiguous and thus unenforceable, since the building line to which the restriction applied was unspecified. Id. at 525. On appeal, we affirmed, holding:
We . . . find no error in the court's conclusion that an ambiguity existed.
"Whether a [contract provision or] term is clear or ambiguous is a question of law." Nester v. O'Donnell, 301 N.J. Super. 198, 201 (App. Div. 1997) (quoting Kaufman v. Provident Life and Cas. Ins. Co., 828 F. Supp. 275, 282 (D.N.J. 1992) (additional alteration omitted)). "An ambiguity in a contract exists if the terms of the contract are susceptible to at least two reasonable alternative interpretations." Id. (quoting Kaufman, 828 F. Supp. at 283). [Assisted Living, supra, 31 F.Supp.2d at 398.]
The unspecific language of the deed restriction in this case, together with the varying interpretations placed upon that language, provide ample grounds for the court's legal conclusion.
An ambiguous restriction will not be enforced in equity so as to impair the alienability or use of property. Caullett v. Stanley Stilwell & Sons, Inc., 67 N.J. Super. 111, 115 (App. Div. 1961) As we stated there:
It must be remembered that a restrictive covenant is in its inception a mere contract, subject to the interpretative doctrines of contract law which focus on the parties' mutual purpose. . . . A purported contract so obscure that no one can be sure of its meaning is incapable of remedy at law or equity for its alleged breach and therefore cannot constitute a valid impediment to title. [Id. at 115-16.] [Cooper River Plaza, supra, 359 N.J. Super. at 528-29.]
We find the quoted language of Cooper River Plaza equally applicable to the present case. A fair reading of Schedule B discloses that it is susceptible to several interpretations: that the parties agreed (1) house construction could only occur along a designated portion of Douglass Avenue; (2) house construction could only occur at the designated location on Douglass Avenue and in the two locations designated by rectangles and labeled as "approved by Mr. Canavan"; or (3) the rectangles were illustrative only and did not serve to restrict the development of the property other than within the designated field. Further, there is nothing in the language of Schedule B itself that provides a means to determine which of these interpretations is correct. In these circumstances, as in Cooper River Plaza, the alleged restriction, ambiguous in the extreme, cannot be enforced.*fn3
The trial judge's order, insofar as it relates to an interpretation of Schedule B, is therefore affirmed.
In their cross-appeal, the Edwards argue that the trial judge misunderstood their motion for sanctions against the McGraths, and they appear to be correct in this regard. The record suggests that the trial judge assumed that the Edwards were claiming that the McGraths' entire action was frivolous, and to have sought sanctions on that basis. However, the Edwards' argument was considerably narrower and more focused. They argued that the McGraths' motion for summary judgment on an issue that the judge had previously ruled required resolution at trial was legally unsupported and sanctionable pursuant to Rule 1:4-8(b)(1). Because the trial court did not rule on this issue, we remand for its further consideration.
Affirmed in part and remanded in part.