Martin v. City of Seattle
765 P.2d 257, 111 Wash. 2d 727 (1988)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A power of termination for breach of a condition subsequent in a deed must be exercised within a reasonable time after the holder of the power knew or should have known of the breach. Failure to exercise the right within a reasonable time results in its expiration.
Facts:
- In 1908, C.B. Dodge Company quitclaimed a strip of land to the City of Seattle for the construction of a boulevard.
- The 1908 deed contained a condition requiring the City to acquire adjacent shorelands and permit Dodge and its successors to build and maintain a private boathouse on that shoreland.
- The deed reserved for Dodge and its successors a power of termination, or right of reentry, allowing them to reclaim the property if the City breached the condition.
- In 1913, the State of Washington granted the relevant shorelands to the City of Seattle by public statute.
- The 1913 grant from the State stipulated that the land was to be used exclusively for public park purposes and would revert to the State if used for any other purpose.
- Between 1908 and 1983, neither Dodge nor its successors in interest made any demand upon the City for permission to build a boathouse.
- In July 1983, plaintiffs, the successors to Dodge, notified the City of their desire to build a boathouse, and the City refused permission.
Procedural Posture:
- Plaintiffs sued the City of Seattle in Washington trial court, seeking declaratory relief and damages.
- The trial court held that the City breached the condition in 1983 and awarded plaintiffs $50,000 in damages.
- The City of Seattle, as appellant, appealed to the Washington Court of Appeals.
- The Court of Appeals affirmed the trial court's decision, holding for the plaintiffs, who were the appellees.
- The City of Seattle, as petitioner, was granted review by the Supreme Court of Washington.
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 grantor's power of termination expire if it is not exercised within a reasonable time after the grantor knew or, through the exercise of due diligence, should have known that a condition subsequent in the deed was breached?
Opinions:
Majority - Pearson, C.J.
Yes, a grantor's power of termination expires if not exercised within a reasonable time after the holder had actual or constructive notice of the breach. The court reasoned that the City breached the deed's condition in 1913, not 1983. The breach occurred when the City accepted the shorelands from the State subject to a restriction that they be used solely for public park purposes, which made it legally impossible for the City to permit the construction of a private boathouse. Because powers of termination are disfavored as they cloud title and risk forfeiture, the law requires diligence from the holder. The grantor had constructive notice of the 1913 breach because the transfer was made by public statute, and as adjacent property owners, they should have been aware the land was being used exclusively as a park. Waiting 70 years, from 1913 to 1983, to declare a forfeiture is not a reasonable time; therefore, the power of termination had long since expired.
Dissenting - Callow, J.
No, the power of termination should not expire under these circumstances because the breach did not occur until 1983. The dissent argued that the City's obligation to perform was not triggered until the landowners made a demand in 1983; therefore, no breach occurred in 1913. The doctrine of anticipatory breach does not apply because the grantor had already fully performed by deeding the land. The majority's reliance on constructive notice is unfair, as the 1913 statute was a specific land conveyance, not a general law, and the use of the land as a park was consistent with the parties' expectations. Traditional equitable defenses like laches do not apply because the City suffered no prejudice from the delay. The majority's ruling allows the City to retain the land without fulfilling the promise it made to acquire it, resulting in an uncompensated taking.
Analysis:
This decision significantly impacts the enforcement of future interests in Washington by imposing a diligence requirement on holders of powers of termination. By starting the clock for a 'reasonable time' from the moment of constructive notice, the court effectively creates a laches-like limitation on a right historically exempt from the Rule Against Perpetuities. This holding promotes the public policy of land marketability by preventing ancient, dormant deed conditions from indefinitely clouding titles. Future cases involving such reversionary interests will now require an analysis of when a breach should have been discovered, not just when it was actually discovered or acted upon.
