New York Court Grants Summary Judgment in Action to Void a Restrictive Covenant

The Supreme Court of New York, Suffolk County, recently granted a property owner’s motion for summary judgment and held that a purported restrictive covenant on the property was void.  See U & Me Homes, LLC v. Cty. of Suffolk, 148 N.Y.S.3d 682 (N.Y. Sup. Ct. July 16, 2021). In the case, the plaintiff purchased an undeveloped parcel of land that was split-zoned by the defendant Town of Southampton (the “Town”), with a portion permitting 2-acre residential development and a larger portion permitting 5-acre residential development. The deed and title search report, however, did not contain any reference to any development restrictions. The plaintiff immediately proceeded to obtain a Health Department permit and an engineering permit from the defendant County of Suffolk (the “County”) to build a one-family home on the property. Shortly thereafter, a neighbor complained to the Town that there was a developmental restriction on the property, which the Town sought to confirm with the County. Both the Town and the County agreed that the proposed home could not be built because the parcel contained a blazed section of a public trail. However, the County had issued a quitclaim deed in 2010 to a predecessor in title that did not include any restrictive language. Moreover, a bargain and sale deed dated March 21, 2000 did not include any restrictions, despite the County Director of Planning’s recommendation. The plaintiff brought this action alleging that the covenant failed to run with the land and bind grantees, successors or assigns, and that such a restriction is offensive to public policy. The parties cross-moved for summary judgment.

The Court granted the plaintiff’s motion and denied the Town and County’s motion. First, the Court found that there was no proof that the original grantor and grantee intended the covenant to run with the land, noting that “[w]hen the purpose and effect of a covenant is to substantially alter the legal rights which otherwise would flow from the ownership of land and which are connected with the land, such requires a clear showing that the original grantee and grantor intended the covenant to run with the land.” The Court also found that the faulty drafting of the March 21, 2000 deed by the County called into question whether a restrictive covenant was even created, and that the County offered no statutory authority to support its ability to enter into such a restriction. Moreover, the Court found that, even conceding that the County wanted to restrict the development of the property, as the drafter of the deed, it could have easily drafted a deed binding successors to the use restrictions, noting that “[t]his is not a case of exalting technical form over substance, but of a complete failure of substance, on the part of the County.” Lastly, the Court found that the County and the Town both overstepped their bounds and reversed the role of government in response to issues that implicate the Bill of Rights and the Constitution, noting that “[t]he combined actions of these two governmental bodies have deprived the plaintiff of a bedrock constitutional right and have brought about a per se taking of an important ‘stick’ in the ‘bundle of sticks,’ the power to exclude people from one’s real property.” Here, the County failed to adequately protect the initial deed and as such, that deed restriction did not run with the land. Thus, the Court determined that the plaintiff was free to pursue its long-delayed residential permit application.

For a copy of the decision, please contact Michael O’Donnell at modonnell@riker.com, Michael Crowley at mcrowley@riker.com, Desiree McDonald at dmcdonald@riker.com, or Kevin Hakansson at khakansson@riker.com.