Station Associates, Inc. v. Dare County
1999 N.C. LEXIS 242, 350 N.C. 367, 513 S.E.2d 789 (1999)
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Rule of Law:
To create a fee simple determinable, a deed must contain express and unambiguous language of reversion or termination. A mere expression of the purpose for which the property is to be used, without an explicit provision for forfeiture or reentry, is insufficient to create a conditional estate and instead passes a fee simple absolute.
Facts:
- In 1897, Jessie B. Etheridge conveyed approximately ten acres of land to the United States government in a deed.
- The deed stated that the Secretary of the Treasury deemed it advisable to acquire the land as a site for a Life-Saving Station and that the premises were 'to be used and occupied for the purposes named'.
- The United States took possession and established a life-saving station, which was later operated by the U.S. Coast Guard.
- The deed did not contain any clause providing that the property would revert to Etheridge or his heirs if it ceased to be used for its stated purpose.
- In December 1989, the U.S. Coast Guard abandoned the station.
- On July 17, 1992, the United States executed a quitclaim deed transferring its interest in the property to Dare County.
Procedural Posture:
- The heirs of Jessie B. Etheridge (plaintiffs) sued Dare County (defendant) in Superior Court, Dare County (a state trial court) to claim title to the property.
- The trial court granted judgment on the pleadings in favor of defendant Dare County, ruling that the county held title in fee simple absolute.
- Plaintiffs, as appellants, appealed the decision to the North Carolina Court of Appeals (an intermediate appellate court).
- The Court of Appeals reversed the trial court, holding that the deed created a fee simple determinable and remanded the case.
- Defendant Dare County, as appellant, appealed the Court of Appeals' decision to the Supreme Court of North Carolina (the state's highest court).
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Issue:
Does a deed that conveys land for a specified purpose, such as a life-saving station, but lacks any express language of reversion or termination, create a fee simple determinable that causes title to revert to the grantor's heirs when that purpose ceases?
Opinions:
Majority - Parker, Justice
No. The deed conveyed a fee simple absolute, not a fee simple determinable. The law disfavors interpretations that create a condition subsequent unless the grantor's intent to create such a restriction is clearly manifested through express language. A mere statement of purpose, such as for 'school purposes' or, in this case, for a 'Life-Saving Station,' is insufficient to create a defeasible fee. To create a fee simple determinable, the deed must contain explicit language of reversion, right of re-entry, or automatic termination upon the cessation of the specified use. The 1897 Etheridge deed is completely devoid of any such language. Phrases like 'use and occupy' and 'for the term of this covenant' do not equate to an unambiguous expression of intent to create a determinable estate. Therefore, the United States received a fee simple absolute, which it validly conveyed to Dare County.
Analysis:
This decision solidifies a strict constructionist approach to interpreting deeds in North Carolina, prioritizing the certainty and marketability of land titles. It establishes a bright-line rule requiring explicit 'magic words' of reversion or termination to create a defeasible fee, rather than relying on a holistic inquiry into the grantor's presumed intent. The ruling serves as a clear warning to drafters that any desired restrictions on an estate's duration must be expressly and unambiguously stated in the conveyance. Consequently, it makes it much more difficult for heirs to reclaim property based on discontinued use decades after the original grant unless the deed contains precise reversionary language.
