Enforcement of Restrictions
by Gary Casaly, Esquire
Although there's always the question of what activities restrictions may prohibit, the main issue concerning restrictions is their enforceability. But before I get to that point, I want to explore the question of where the conveyancer should look for restrictions in the first place. Everyone would agree that the registry of deeds is a good place to start! But what instruments should the examiner look at? The answer is not as simple as it would seem.
Ordinarily, the examiner searches the "chain of title" to determine what matters affect any particular parcel of land. But what instruments are included in this ephemeral "chain of title"? One would think that the chain of title is the "thread" that is simply followed from A to B to C, and so forth. But under case law when it comes to restrictions the "thread" may have a few unraveled edges that must be accounted for. Under Guillette v. Daly Dry Wall, Inc., 367 Mass., 325 N.E.2d 572 (1975) the Supreme Judicial Court held that if locus is included within land owned by a common grantor and that common grantor conveys other land under his ownership (i.e., nonlocus) to another that the provisions in that deed out, even though the deed is of nonlocus land, must be scrutinized to determine whether locus (still then retained by the common grantor) has thereby been impressed with restrictions. Stated another way, it's necessary to look at all deeds out by the common grantor, even when the deed out is of nonlocus property, to determine whether restrictions have been imposed upon locus. In Guillette the court said, "Lot numbers or other descriptive information, even though included in an index, do not change what is recorded. * * * In such a [recording] system the purchaser cannot be safe if the title examiner ignores any deed given by a grantor in the chain of title during the time he owned the premises in question." The result here is that if the common grantor in conveying nonlocus to another states in that deed out that he agrees to restrict his remaining land (that includes locus) to restrictions then locus will thereby be subjected to those restrictions. So, when it comes to where one must look and what instruments one must look at to determine whether restrictions affect land, the answer goes beyond the conventional "chain of title."
Restrictions in the deeds out that are also reciprocal to the grantor's remaining land impose an additional duty upon the title examiner to look at them, because they satisfy the requirements of the Statute of Frauds (see Houghton v. Rizzo, 361 Mass. 635, 281 N.E.2d 577 (1972)), an element that must be observed in accordance with decisions of the Supreme Judicial Court. This age-old English statute was discussed in Snow v. Van Dam, 291 Mass. 477, 197 N.E. 224 in connection with common schemes. In Snow deeds of other lots included restrictions upon those lots but did not state that the restrictions were likewise imposed upon the grantor's remaining land. The court noted that the existence of a "common scheme" does not impose restrictions on retained land or other lots not specifically restricted, but rather identifies those parcels that are entitled to enforce the restrictions. Where, for example, restrictions are imposed on one lot they are not thereby implied as being imposed upon another lot, for this would violate the Statute of Frauds, the very law that in Houghton permitted the imposition of restrictions. To the contrary, if there is a common scheme, then the owner of the retained lot may be able to enforce the restrictions upon the lot deeded out. The reverse, however, is not the case - the owner of the restricted lot cannot claim that similar restrictions were impliedly imposed on the retained land, unless such imposition was in writing. In this regard, the provisions of G.L.c. 184, §§26, 27 essentially codify the following, that was said in Snow:
What is meant by a "scheme" of this sort? * * * Where a scheme exists, it appears to be the law of England and some American jurisdictions that a grantee subject to restrictions acquires by implication an enforceable right to have the remaining land of the vendor, within the limits of the scheme, bound by similar restrictions. [Citations omitted.] But it was settled in this commonwealth by Sprague v. Kimball, 213 Mass. 380, 100 N.E. 622, that the statute of frauds prevents the enforcement against the vendor, or any purchaser from him, of a lot not expressly restricted, of any implied or oral agreement that the vendor's remaining land shall be bound by restrictions similar to those imposed upon lots conveyed. Only where, as in [recitation of cases] the vendor binds his remaining land by writing, can reciprocity of restrictions between the vendor and the vendee be enforced.
* * * * *
Nevertheless, the existence of a "scheme" continues to be important in Massachusetts for the purpose of determining the land to which the restrictions are appurtenant . . . .
So, although the examiner must look at deeds out to see if they contain reciprocal restrictions or agreements to impose restrictions on retained land, it is not necessary to raise as an issue the imposition of restrictions on locus simply because nonlocus lots in the proximity of locus contained restrictions.
Once we know where to look, the question then becomes what are we looking for? When considering restrictions one must be mindful of what provisions of the instrument are enforceable, the persons and the land against whom and which enforcement may be had, the persons who are entitled to demand enforcement, the remedies that are available in connection with enforcement and the period during which enforcement is permitted.
The statutes provide that for restrictions to be enforceable they must be of "actual and substantial benefit" to the person claiming enforcement. This criterion is so subjective that it's nearly impossible to apply the rule.
Another "formula" used to determine the enforceability of restrictions, which is a little less subjective, revolves around the requirements of "benefited land." Both G.L.c. 184, §§27, 28 use this term in connection with the enforcement of restrictions. That term is defined in G.L.c. 184, §26, and means "land for the benefit of which such restriction is imposed." The definition does not shed much light on the subject of the enforceability of restrictions, but G.L.c. 184, §30 and the decision in Garland v. Rosenshein, 420 Mass. 319, 649 N.E.2d 756 (1995) do. In Garland a party brought an action to determine whether a restriction that had been imposed on his property by the defendant was enforceable under the statute. The plaintiff had purchased the property from the defendant's transferee. At the time the restriction had been imposed the defendant owned no other land in the area. It was decided in Garland that the requirement of the statute was not met, and the restriction was not enforceable because (i) it was determined to be a restraint on alienation (it was overly burdensome) and (ii) the defendant had no property in the area which would benefit from the restriction, therefore rendering the restriction personal in nature and preventing it from running with the land. This latter point was addressed by the court as follows:
Even under traditional common law principles, the restriction fails. The defendant admittedly owns no land which is benefited by the restriction. The only benefit from the restriction is the potential economic gain that the defendant may receive if someone is willing to pay the defendant in order to release the restriction. This benefit is personal, and does not confer a direct physical advantage to any piece of land owned by the defendant. Cases have stated that, where the benefit is personal, the burden of the covenant does not run with the land. See Orenberg v. Johnston, 269 Mass. 312, 316 (1929) ("fact that there is no other land to which the promise concerning the [maintenance of] the clock could be annexed makes it unenforceable either at law or in equity against any successor in title"). But see Middlefield v. Church Mills Knitting Co., 160 Mass. 267, 271?272 (1894). Further, although we have expressed a willingness to reconsider common law rules concerning the creation, validity, and enforcement of servitudes, see Bennett v. Commissioner of Food & Agric., 411 Mass. 1, 7 n.4 (1991), this is not a case where "old common law rules barring the creation and enforcement of easements in gross have no continuing force." Id. at 6 (enforcing servitude in the absence of dominant estate where enforcement consistent with public policy and reasonable).
Although other land may be the subject of the benefit of a restriction, the restriction may not be enforceable if the land is owned by a "stranger" to the instrument creating the restriction. As is true also with easements, it is generally not possible to create rights in restrictions in persons who are not parties to a deed. In Asian American Civic Association v. Chinese Consolidated Benevolent Association of New England, Inc., 43 Mass.App.Ct. 145, 681 N.E.2d 882, further appellate review denied, 426 Mass. 1101, 686 N.E.2d 200 ( 1997) the City of Boston conveyed property to Chinese Consolidated Benevolent Association of New England, Inc. and the deed contained the following language:
The Grantee, for itself, its successors and assigns, agrees to devote the property to the uses specified in its proposal for the purchase of the property dated February 4, 1983, and to use its best efforts to comply with plans and specifications for the renovation prepared by Jung/Brannen Associates and previously submitted to the Grantor.
The "proposal for the purchase of the property" referenced in the language in the deed was a letter dated February 4, 1983, in which the following paragraph appeared:
The [property] will be renovated and converted to a multi-purpose Chinese Community Center that will provided accommodation for the [Asian American Civic Association, Inc.] itself and a variety of social service, employment training and cultural programs and activities.
When Chinese Consolidated Benevolent Association of New England, Inc. leased a portion of the property to a third party The Asian American Civic Association, Inc. brought an action claiming its rights to occupancy pursuant to the letter referenced in the deed. In addition to ruling that the indefinite reference statute (G.L.c. 184, §25) prevented rights from inuring to The Asian American Civic Association, Inc. the court noted that the Association had no rights for another reason:
In seeking to establish rights under the deed from the city to [Chinese Consolidated Benevolent Association of New England, Inc., The Asian American Civic Association, Inc.] suffers from the initial embarrassment of not being a party to it. It remains the general rule in Massachusetts that a possessory right said to inhere in a deed cannot successfully be maintained by a person who is a stranger to the deed. (Citations omitted.) See G.L.c. 184, §27(a), requiring that a person who seeks enforcement of a restriction be a party to the recorded instrument that imposes the restriction.
Regardless of the "benefited land" rule, it's tough to establish whether there is or not such other land involved. It becomes evident, then, that in reviewing restrictions with an eye to determine when they expire or whether they are enforceable one must look to more empirical or objective standards. One such standard revolves around the passage of time. It would seem easy enough to count the number of years that have elapsed and thereby determine whether or not a restriction has expired. But there's even some confusion here in what appear to be (but in fact are not) contradictions in the statutes. For example, would restrictions imposed in 1959 be limited to thirty years or fifty years? One statute (G.L.c. 184, §28) provides that no restriction imposed before 1962 shall be enforceable after fifty years while another statute (G.L.c. 184, §23) states that restrictions unlimited in time shall not be enforceable after thirty years, but this latter statute does not apply to restrictions existing in 1887 and years prior thereto! What statute controls? Then there's the provisions of the statutes that permit restrictions to be extended. Which ones can be extended and for how long will the extension be good?
Restrictions which are "unlimited as to time" expire in thirty years and cannot be extended. G.L.c. 184, §23. (I'm sure some readers will wonder whether the result here is that after thirty years there will be chaos among condominiums whose restrictions would seem to expire then. But do not panic. Johnson v. Keith, 368 Mass. 316, 331 N.E.2d 879 (1975) tells us that the statute does not apply to condominiums.)
Restrictions that are not "unlimited as to time" can, in certain instances, be extended, up to the maximum time permitted under the instrument imposing them. But, if not brought forward, these restrictions will be limited to thirty years or fifty years. G.L.c. 184, §§27, 28, 29. What do these statutes provide as far as keeping restrictions alive? G.L.c. 184, §27, which applies to restrictions imposed on or after December 31, 1961, limits restrictions to a thirty year period, defines who the persons enforcing the restriction must be - essentially (I) parties named as a benefited parties or (ii) a parties who own benefited land adjoining the subject parcel or stated to be benefited land - and to what land the extended restriction will apply. That's pretty straight forward.
As to restrictions governed by this statute, who are the persons who must bring the restriction forward? If the restrictions apply to four or more contiguous parcels (a common scheme) then paragraph (b)(1) of G.L.c. 184, §27 provides that "provision [may be] made in the instrument or instruments imposing [the restriction] for extension for further periods . . . [and that] owners . . . of fifty percent or more of the restricted area . . . [may execute] an extension in accordance with such provision," thereby extending the restrictions. Note a few important points here: (A) The restriction itself must contain a provision for the extension of the restrictions - it can't simply provide that the restrictions will endure for a set period of time. (B) Paragraph (b)(1) refers to an "extension," not, like paragraph (b)(2), discussed below, to a "notice of restriction." This distinction in verbiage will become important, as you'll see. (C) It is fifty percent of the owners of the restricted area (not simply fifty percent of the lot owners) who can decide to keep the restrictions alive with respect to the entire restricted area - sort of a "majority rule" concept. In other words, paragraph (b)(1) provides for the parties to make up their own rules as to the continuance of restrictions. If the restrictions in any particular case don't comply with these requirements, then they would be governed by paragraph (b)(2).
Paragraph (b)(2) of G.L.c. 184, §27 refers to a "notice of restriction," a word (or phrase) of art. If there's no common scheme or, even if there is one and there's no compliance with the requirements of paragraph (b)(1) as to what the restriction document must contain, then the "default" as to the continuance of restrictions revolves around complying with the provisions concerning this "notice of restriction." When it comes to this "default" mode, we look to G.L.c. 184, §29. This statute has two basic functions: (I) it tells us where we must record either a notice of a restriction (paragraph (b)(2) of G.L.c. 184, §27) or an extension of a restriction (paragraph (b)(1) of G.L.c. 184, §27) and (ii) it tells us that "notices" under G.L.c. 184, §27 may (A) apply to "any number of parcels subject to the restriction"and (B) may be enforced only by the persons who have executed the notice. (Note that under the "common scheme" provisions of paragraph (b)(1) of G.L.c. 184, §27 it's an all-or-nothing proposition - all land is brought under the continued restrictions and all persons in the common scheme can enforce them.)
The provisions of G.L.c. 184, §28, which governs restrictions imposed before January 1, 1962, initially limit restrictions to fifty years and contain basically similar provisions as those in G.L.c. 184, §27 (although there are some differences, most notably the provision that permits a mortgagee to execute an extension).
So, as to the persons who can extend restrictions, if a common scheme is involved - and if the instrument creating the restrictions makes provision for their extension - then an extension signed by owners of fifty percent of the restricted area can extend the restrictions as to the entire area comprising the common scheme. On the other hand, if there is no common scheme to which the restrictions apply - either because there's no common scheme as defined in the statute (four or more contiguous parcels) or because the instrument creating the restrictions does not contain the extension provisions called for or necessary under the statute - then there must be compliance with the "notice of restrictions" provisions of G.L.c. 184, §29, in which case the restrictions will be continued only as to the parcels identified in, and only for the benefit of those signing the notice, provided that the notice is recorded in a timely fashion. As noted above, in any case G.L.c. 184, §29 defines where a notice of restriction or an extension must be recorded.
As noted, restrictions imposed after December 31, 1961 have, initially, a life of thirty years (unless properly extended) while restrictions imposed before January 1, 1962 have, initially, a life of fifty years (unless properly extended). The first extension or notice of restriction must, with respect to the former, be filed within the thirty-year period and, with respect to the latter, within the fifty year period and, in either case, thereafter refiled each twenty years. The refilings, however, cannot extend the restrictions beyond the stated term in the instrument.
In The Stop & Shop Supermarket Company v. Urstadt Biddle Properties, Inc., 433 Mass. 285, 740 N.E.2d 1286 (2001) the question as to the relationship between restrictions imposed under G.L.c. 184, §23 (those unlimited in time) and those imposed under the other statutes referenced above was explored. In that case in 1970 abutting landowners agreed to the imposition of restrictions on land then owned by a predecessor of Stop & Shop. The restrictions were stated in the instrument to be enforceable for fifty years. In 1983 the two landowners agreed to an amendment to the restrictions, including the deletion of the fifty-year limitation on the restriction. In 1996 Stop & Shop purchased the property. Soon thereafter the abutting owner brought an action against Stop & Shop to enforce the restrictions and in 1998 the abutting owner recorded a "notice of restriction," purportedly extending the restrictions for twenty years under G.L.c. 184, §27 (which governs restrictions imposed after December 31, 1961).
All parties agreed that the 1983 amendment rendered the restrictions as being unlimited as to time. The disagreement among the parties revolved around (I) whether the restrictions, though unlimited as to time, could nonetheless be extended under the 1998 "notice of restriction," and (ii) if the restrictions unlimited in time could not be extended, when would their thirty-year life expire under G.L.c. 184, §23. The abutter argued that nothing in G.L.c. 184, §27 prevented a "notice of restriction" from extending a restriction which at the time was governed by G.L.c. 184, §23. The court said:
While [the abutter's] assertion may be true as a technical matter, §27, by its express terms, requires, in order to extend the period of enforceability, that a notice of restriction be recorded "before the expiration of the thirty years [from the imposition of the restriction]." This statutory language indicates that restrictions for less than thirty years do not come within the scope of §27, and thus, cannot be extended under the statute. Section 27 is to be read, to the extent possible, harmoniously with §23. [Citation omitted.] If, as [the abutter] contends, a restriction unlimited as to time merely needed the recording of periodic notices under §27(b) to remain in force, then §23 itself would be superfluous, as §27(b) would extinguish any restriction as to which the proper notice had not been recorded. Rather, §23 sets a "term" of thirty years in the absence of any stated time frame in the parties' underlying agreement, and nothing in §27(b) allows for any extension of that term.
The effectiveness, or lack thereof, of the abutter's extension notice was thereby settled.
The question remained in the case as to whether the thirty-year period of the restriction, once rendered unlimited in time by reason of the amendment, ran from the original date of the instrument containing the restriction (1970) or from the time of the amendment (1983). Of course, Stop & Shop argued the former position, while the abutter maintained the latter. In this regard, the court stated:
We next turn to the date on which the restriction began to run. Section 23 provides that "restrictions unlimited as to time . . . shall be limited to a term of thirty years after the date of the deed or other instrument . . . creating them." Stop & Shop contends that the word "creating" in §23, commences the thirty-year limitation period. Stop & Shop maintains that it is the date of the instrument that originally created the restriction from which the limitation period runs . Stop & Shop's argument ignores relevant, and reasonably clear, language in the statute, namely, the words "unlimited as to time," that follow and qualify the term "restrictions." * * * The language of §23 informs us that the date from which its thirty-year limitation period begins to run is the date on which the restriction became or becomes unlimited as to time .
The court interpreted the words "creating them" to modify the term "restrictions unlimited as to time," and concluded that the original restriction instrument did not "create" the unlimited restrictions (inasmuch as originally they had a term of fifty years) and that it was the amendment that "created" the restrictions unlimited as to time.
A companion statute to those discussed above and which limits the enforcement of restrictions should be kept in mind. It is G.L.c. 184, §23A. That statute provides that in the event that certain private restrictions have been violated and the violation has existed for more that six years, the restrictions cannot be enforced with respect to the particular offending structure. This does not mean that the restriction is "dead," but rather that its enforcement will be prevented with respect to the particular structure that is in violation of it. If the thirty- or fifty-year period (or longer, if extended) has not expired, the restrictions can still be enforced as to future violations regarding other structures.