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Welshire, Inc. v. Harbison

Supreme Court of Delaware

September 30, 1952

WELSHIRE, Inc.
v.
HARBISON et al.

James R. Morford and William Marvel (of Morford, Bennethum, Marvel & Cooch), of Wilmington, for appellant.

Stephen E. Hamilton, Jr. (of Logan, Marvel & Boggs), of Wilmington, for appellees.

SOUTHERLAND, C. J., and WOLCOTT and TUNNELL, JJ., sitting.

SOUTHERLAND, Chief Justice.

Plaintiff Welshire, Incorporated (herein 'plaintiff'), the owner of a tract of land in Brandywine Hundred, New Castle County, lying to the northeast of the junction of the Carr and Shipley Roads, planned to create an attractive residential development upon the tract. On April 5, 1937, plaintiff prepared a tentative plan or plot of the tract, upon which the land was divided into building lots of an average frontage of 150 feet. On July 8, 1937, plaintiff, by means of a conveyance to and reconveyance from

Page 405

'1. The land included in the above described tract shall be used for private residence purposes only and no building of any kind whatsoever shall be erected or maintained thereon except private dwelling houses, each dwelling being designed[33 Del.Ch. 201] for occupation by a single family, and private garages for the sole use of the respective owners or occupants of the lots upon which such garages are erected, and not more than one residence shall be erected or constructed upon any lot shown upon the plot of Welshire.'

Additional restrictions appropriate to a residential development were set forth, including a specification of required building set backs and open areas. No provision was included for the revocation or change of any of the restrictions, which were to continue until January 1, 1967. The plot was not recorded.

On July 21, 1937, defendants, having obtained a copy of the restrictions and inspected the plot, bought from plaintiff one of the lots in the development, being lot No. 4, fronting on the Carr Road. For a period of at least ten years thereafter plaintiff was unable to effect the sale of any other lot. Sometime in 1947 plaintiff decided to change the restrictions in Welshire but at that time apparently took no formal action about it. Sales were effected of two other lots in 1947 and 1950, the purchasers of which, we gather, assented to certain changes in the restrictions.

On February 9, 1951, plaintiff undertook to change the restrictions applicable to Welshire by means of conveying and reconveying the tract as before, the reconveyance setting forth revised restrictions. A revised plot was recorded. Whereas the original plot had divided the development into 77 lots with an average frontage of 150 feet, the revised plot shows the land subdivided into 114 lots, the greater part of the lot frontages having been reduced to an average of 90 to 100 feet. Reductions in the set-back and open-area requirements were also made. A clause permitting changes in the revised restrictions under certain conditions was also included, but plaintiff has conceded this change to be ineffectual. The changes in lot frontages and set backs do not apply to defendants' lot or to the lots in their immediate vicinity.

Plaintiff sought and obtained from the owners of the two lots sold in 1947 and 1950 their consent to the proposed changes. It was unable to obtain the consent of the defendants.

On August 10, 1951, plaintiff filed its petition in the court below for a declaratory judgment to the effect that plaintiff had the right [33 Del.Ch. 202] to make the 1951 changes in the restrictions and that the defendants had no right to object thereto. The defendants joined issue.

The case was tried before the Vice Chancellor upon oral testimony and exhibits. He held that the attempted changes in the restrictions had been ineffectual and that the defendants were entitled in equity to enforce them. He accordingly dismissed the petition, 88 A.2d 121, and plaintiff has appealed.

Plaintiff in the court below made three contentions and renews them here.

First, plaintiff asserts that the 1937 restrictions did not forbid change in lot size, and that therefore the only substantial change effected in 1951 related to set-back and open-area space requirements. Plaintiff urges that restrictions of this sort are to be enforced 'locally' only, that is to say, they are for the benefit of lots in a particular block or square and may not be enforced at the suit of a lot owner residing in another block or square. The same principle, plaintiff says, would apply even if change in lot size is forbidden. Rogers v. Zwolak, 12 Del.Ch. 200, 110 A. 674, is cited in support of this argument.

We are unable to accept either of these contentions. The first restriction provides that not more than one residence shall be built 'upon any lot shown upon the plot of Welshire', and the set-back restrictions are obviously drawn in the light of the width of the lots shown on the plot. The bearing of lot size upon the character of

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a residential development is obvious. We think the language embodied a restriction against subdividing the lots. See Matthews v. Kernewood, Inc., 184 Md. 297, 40 A.2d 522.

We are also unable to agree with the argument that certain of the restrictions before us are enforceable only if the lot in which the violation occurs is in the same block or square as that of the objecting owner. In Rogers v. Zwolak, supra, relied on by plaintiff, the owner of a tract of land fronting on Market Street in the City of Wilmington between Twenty-fourth and Twenty-eighth Streets had sold certain of the lots lying between Twenty-fourth and Twenty-sixth Streets, and had imposed upon them a set-back or open-area restriction applicable to the Market Street frontages. [33 Del.Ch. 203] No such restriction was imposed on the remaining lots of the tract. In holding the restriction enforceable at the suit of a lot owner in the same block, the Chancellor said that such a restriction was for the benefit of lots in the immediate vicinity of the lot bound by the restriction and not necessarily for lots in other blocks or squares. Assuming this latter holding to be correct, we do not think that it helps the plaintiff. In the Rogers case the intent of the 'neighborhood scheme' was inferable only from the making of successive deeds imposing the same restriction; and the extent of the area to be reciprocally affected was likewise left to inference. Here the intent of the developer to establish a uniform and reciprocal system of restrictions and to make it applicable to every lot in the tract was made manifest before a single lot was sold. In such a case as this any lot owner having purchased subject to the restrictions is bound by them and may enforce them against any other owner and against the developer. Jackson v. Richards, 26 Del.Ch. 260, 27 A.2d 857; Tubbs v. Green, 30 Del.Ch. 151, 55 A.2d 445; Hollingsworth v. Szczesiak, Del.Ch., 84 A.2d 816; cf. Gammons v. Kennett Park Development Corp., 30 Del.Ch. 525, 61 A.2d 391. To apply a 'block rule' to the instant case would destroy the uniformity specifically intended and provided for.

Second, plaintiff contends that a material change has occurred in surrounding circumstances frustrating the purpose for which the restrictions were imposed in 1937. Plaintiff invokes the equitable doctrine that if, by reason of changed circumstances, the purpose served by the restrictions has come to an end, equity will refuse to enforce a restrictive covenant affecting real estate and in some cases will decree its termination as a cloud upon title. The Restatement of the Law of Property thus states the rule (Sec. 564):

'Injunctive relief against violation of the obligations arising out of a promise respecting the use of land cannot be secured if conditions have so changed since the making of the promise as to make it impossible longer to secure in a substantial degree the benefits intended to be secured by the performance of the promise.'

And see the cases collected in the note in 4 A.L.R.2d 1111, 1117.

The typical case for the application of this rule is the case [33 Del.Ch. 204] of residential restrictions which have become valueless by reason of a complete change of a neighborhood from a residential one to a commercial or industrial one. Such a change supplies the reason for the decisions in many of the cases cited by plaintiff. Thus, for example, the decisions of the Supreme Court of Pennsylvania in Price v. Anderson, 358 Pa. 209, 56 A.2d 215, 2 A.L.R.2d 593, and Katzman v. Anderson, 359 Pa. 280, 59 A.2d 85, involved a block of land in the City of Philadelphia in a neighborhood the character of which had completely changed from residential to commercial. A similar change in the character of a section of the City of Miami Beach was presented in the case of Osius v. Barton, 109 Fla. 556, 147 So. 862, 88 AL.L.R. 394. However, the change must be so complete in nature as to make it impossible to secure in a substantial degree the benefits sought to be realized through the performance of the promise embodied in the restrictive covenant. See the comment (c) to the quoted section of the Restatement and the illustration thereto appended. A fortiori, a mere change in

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Fidelity Title & Trust Co. v. Lomas & Nettleton Co., 125 Conn. 373 5 A.2d 700 Allen v. Massachusetts ...

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