Estate of Thomson v. Wade, 69 N.Y.2d 570 (1987)
Under the “stranger-to-the-deed” rule, a deed cannot create an easement or other real property interest in favor of someone who is not a party to the deed.
Summary
This case addresses whether a grantor can reserve an easement in a deed for the benefit of a third party who is not a party to the deed (a “stranger to the deed”). The New York Court of Appeals reaffirmed the long-standing rule that such a reservation is invalid. The court reasoned that allowing such reservations would create uncertainty in title and potentially lead to needless litigation, outweighing any potential frustration of the grantor’s intent. The court also held that a personal right-of-way (easement in gross) cannot be transferred if it’s not commercial in nature.
Facts
Plaintiff Thomson and Defendant Wade owned adjacent parcels of land. Thomson’s property (the annex parcel) fronted a river and had a motel, while Wade’s property was inland and bordered a public road. Both parcels were previously owned by Edward John Noble. Noble used Wade’s parcel to access the public road from the annex parcel. When Noble conveyed the annex parcel, he did not grant an express easement over Wade’s parcel. Later, when Noble conveyed Wade’s parcel, he included a clause that “excepted and reserved” a right-of-way for himself and Thomson’s predecessor. Thomson acquired a quitclaim deed to the right-of-way from the Noble Foundation (Noble’s successor-in-interest).
Procedural History
Thomson brought a declaratory judgment action, claiming an easement over Wade’s property. The Appellate Division concluded that no express easement was created. The Court of Appeals affirmed, upholding the “stranger-to-the-deed” rule.
Issue(s)
1. Whether a grantor can reserve an easement in a deed for the benefit of a third party who is not a party to the deed (a “stranger to the deed”).
2. Whether a personal right-of-way (easement in gross) can be transferred to another party.
Holding
1. No, because New York adheres to the “stranger-to-the-deed” rule, which prohibits the creation of an interest in favor of a third party through a reservation or exception in a deed. This rule promotes certainty in title and avoids potential litigation.
2. No, because the right-of-way reserved to Noble personally was not commercial in nature, and therefore could not be transferred to Thomson via the quitclaim deed.
Court’s Reasoning
The court reasoned that Noble could not create an easement benefitting land he no longer owned. Citing Tuscarora Club v. Brown, 215 NY 543, the court reaffirmed the “stranger-to-the-deed” rule, stating that a reservation in favor of a third party does not create a valid interest. While acknowledging that some jurisdictions have adopted a minority view that would recognize such an interest if the grantor’s intent is clear (citing Willard v. First Church of Christ, Scientist, 7 Cal 3d 473), the court declined to abandon the settled New York rule.
The court emphasized the importance of certainty in real property titles, stating that “public policy favor[s] certainty in title to real property, both to protect bona fide purchasers and to avoid conflicts of ownership, which may engender needless litigation.” (Matter of Violi, 65 NY2d 392, 396). The court noted that any frustration of the grantor’s intent can be easily avoided by a direct conveyance of an easement to the third party.
Regarding the personal right-of-way, the court cited Saratoga State Waters Corp. v. Pratt, 227 NY 429, 443, holding that because the right-of-way was not commercial, it could not be transferred to Thomson. Thus, neither the reservation of the easement in gross to Noble nor the reservation of a right-of-way to Thomson’s predecessor entitled Thomson to an express easement across Wade’s property.
The court concluded, “where it can reasonably be assumed that settled rules are necessary and necessarily relied upon, stability and adherence to precedent are generally more important than a better or even a ‘correct’ rule of law” (Matter of Eckart, 39 NY2d 493, 500).