Caullett v. Stanley Stilwell & Sons, Inc.
170 A.2d 52 (1961)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A covenant in a deed is unenforceable as a burden on the property if it is vague, does not 'touch and concern' the land, or if its benefit is 'in gross,' meaning it is personal to the grantor and does not benefit any land retained by the grantor.
Facts:
- Stanley Stilwell & Sons, Inc. (Stilwell), a development company, sold a one-acre lot to Paul and Evelyn Caullett (the Caulletts) for $4,000.
- The deed contained a clause under 'covenants, agreements and restrictions' stating: '(i) The grantors reserve the right to build or construct the original dwelling or building on said premises.'
- The deed also specified that this provision was intended to be a 'covenant running with the land' that would bind the Caulletts and their successors.
- Stilwell asserted that the low sale price of the lot was offered in consideration for the understanding that it would serve as the general contractor for the future dwelling.
- After the deed was delivered, negotiations between Stilwell and the Caulletts regarding the construction of a house failed.
- No separate contract for the construction of a dwelling existed between the parties.
Procedural Posture:
- Paul and Evelyn Caullett filed a lawsuit in the nature of a bill to quiet title against Stanley Stilwell & Sons, Inc. in the New Jersey Superior Court, Chancery Division (trial court).
- The Caulletts moved for summary judgment, asking the court to declare the restrictive clause void and strike it from the deed.
- The trial court granted summary judgment in favor of the Caulletts.
- Stanley Stilwell & Sons, Inc. (defendant-appellant) appealed the trial court's judgment to the Superior Court of New Jersey, Appellate Division.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a clause in a deed reserving to the grantor the exclusive right to construct the original dwelling on the premises create an enforceable covenant running with the land?
Opinions:
Majority - Freund, J.A.D.
No, a clause in a deed reserving to the grantor the exclusive right to construct the original dwelling on the premises does not create an enforceable covenant running with the land. The court held that the provision was an unenforceable personal promise rather than a valid restriction on the title. The court's reasoning was threefold: First, the clause is too vague and indefinite to be enforceable, as it fails to specify the type of structure, its cost, or the duration of the obligation. Courts will not enforce restrictions on the free transferability of land unless their meaning is clear and free from doubt. Second, the covenant does not 'touch and concern' the land; it relates to a single, personal service (construction) rather than directly influencing the occupation, use, or enjoyment of the premises in a permanent way. Third, the benefit of the covenant is 'in gross,' meaning it is purely personal to Stilwell (a commercial advantage) and does not benefit any land Stilwell retained. For a burden to run with the land in New Jersey, its benefit must attach to a dominant estate, not be merely personal to the grantor.
Analysis:
This case provides a clear application of the traditional requirements for a real covenant to run with the land. The decision reinforces the judicial policy favoring the free alienability of property by refusing to enforce restrictions that are ambiguous or serve purely personal, commercial interests rather than benefiting other land. It solidifies the principle in New Jersey that for a burden to be enforced as an equitable servitude against subsequent owners, the benefit cannot be 'in gross.' This holding distinguishes between valid land use restrictions that enhance the value of a dominant estate and unenforceable personal contracts improperly inserted into a deed.
Unlock the full brief for Caullett v. Stanley Stilwell & Sons, Inc.