Loch Sheldrake Associates, Inc. v. Evans
1954 N.Y. LEXIS 1038, 118 N.E.2d 444, 306 N.Y. 297 (1954)
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Rule of Law:
When a reservation of rights in a deed is unambiguous and complete in its terms, its plain meaning cannot be varied or contradicted by extrinsic evidence of the parties' intent or surrounding circumstances. A reserved right to take water from another's land, not made appurtenant to any specific parcel, is a "profit a prendre" in gross, which is assignable and may be used for any purpose by its owner.
Facts:
- For many years, a family named Divine owned Loch Sheldrake, its shores, and a nearby "mill lot" where they operated a mill powered by the lake's water.
- Beginning around 1915, Isidore and Mrs. Evans operated a large summer hotel on property located about a half-mile south of Loch Sheldrake.
- In 1919, the Divines conveyed Loch Sheldrake and its shores to Greenspan (plaintiff's predecessor), but the deed included a reservation giving the Divines the right to dam the lake and draw water, limited only by the lake's natural high and low water marks.
- The Divines sometimes sold water, which had been piped to their mill lot, to the Evans' hotel for its use.
- In 1927, the Divines conveyed their reserved water rights and the mill lot to Isidore Evans (defendant's predecessor).
- Around 1935, operations at the mill ceased entirely.
- After the mill closed, defendant Evans began piping large quantities of water from Loch Sheldrake, via the old mill lot, to her hotel for its use.
Procedural Posture:
- Loch Sheldrake Associates, Inc. (plaintiff) filed a suit in the trial court against Evans (defendant) seeking a declaratory judgment, an injunction, and damages.
- The trial court found in favor of the plaintiff, holding that the reservation created an easement appurtenant for mill purposes only and perpetually restrained the defendant from drawing water for other uses.
- The defendant appealed to the Appellate Division, an intermediate appellate court.
- The Appellate Division modified the judgment, concluding the reservation was not limited to mill purposes but was limited to the uses existing at the time of the 1919 conveyance.
- The plaintiff alone appealed from the order of the Appellate Division to the Court of Appeals, the state's highest court.
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Issue:
Does a reservation in a deed, which grants the right to draw water from a lake between its high and low water marks without specifying a purpose or benefiting parcel, create an assignable right in gross that can be used for any purpose, rather than an easement appurtenant limited to the original user's specific purpose?
Opinions:
Majority - Desmond, J.
Yes. A reservation in a deed that grants the right to draw water without specifying a purpose or benefiting parcel creates an assignable right in gross, which is not limited to any specific prior use. The court's reasoning is that the language of the 1919 deed reservation is plain and unambiguous. It reserves the right to draw water between specific high and low water marks and contains no other limitations or references to the mill or any particular parcel of land. Under the plain meaning rule of construction, courts cannot look to extrinsic evidence, such as the parties' presumed intent or the circumstances of a different, earlier deed (the Le Boy deed), to vary or contradict the clear terms of the instrument. The right reserved was not a true easement appurtenant, as it was not attached to a dominant estate, but rather a 'profit a prendre' in gross—an assignable interest in the land itself that allows the holder to take a product from it. As such, the right is held by the defendant without reference to use on any particular lands and may be used at any place or in any manner.
Dissenting - Conway, J.
No. The reservation should be construed as creating a right appurtenant to the mill lot, limiting the quantity of water that can be drawn, though not necessarily the purpose for which it is used. The majority's holding effectively grants the defendant exclusive rights to all the lake's usable water, rendering the plaintiff's ownership of the lake and the grant of water rights in the deed meaningless. The deed's reference to 'pipelines which now exist' creates an ambiguity that justifies examining surrounding circumstances, which clearly show the reservation was made because of the mill's operation. The parties themselves treated the right as an easement appurtenant in the lower courts. Therefore, the right should be interpreted as being limited in quantity to the amount of water historically used by the mill, which would permit both parties to make use of the lake's water.
Analysis:
This decision solidifies the primacy of the plain meaning rule in the interpretation of deeds and contracts in New York, restricting judicial inquiry into extrinsic evidence when the language of an instrument is clear. It provides a key distinction between an easement appurtenant, which benefits a specific parcel of land, and a 'profit a prendre' in gross, which is a personal, assignable right to take resources from land. The case establishes that a right to take water can be severed from land ownership and exist as an independent, commercially transferable interest, which has significant implications for transactions involving water rights and other natural resources.
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