48 N.Y.2d 354 (1979)
An agreement creating an interest in real property for longer than three years is void against a subsequent purchaser in good faith unless the agreement is recorded, and mere notice of the existence of facilities on the property does not constitute constructive notice of the underlying agreement.
Summary
Todd sued Krolick, seeking to enforce a washing machine agreement between Todd and Krolick’s predecessor in title, Monarch Associates. The New York Court of Appeals held that the agreement, whether a license, lease, easement, or covenant, was unenforceable against Krolick because it was unrecorded. Since it created an interest in real property for longer than three years, Section 291 of the Real Property Law made it void against good-faith purchasers. The court emphasized that mere notice of the washing machines’ presence was insufficient; Krolick needed notice of the agreement itself. Thus, the complaint failed to state a cause of action.
Facts
Todd (plaintiff) had an agreement with Monarch Associates, the previous owner of a property. The agreement involved washing machines on the property and purported to bind Monarch and its successors for ten years.
Krolick (defendant) subsequently purchased the property from Monarch Associates.
Todd sought to enforce the washing machine agreement against Krolick.
The agreement was not recorded.
The plaintiff alleged that the defendants had notice of the washing machines.
Procedural History
The Appellate Division held that the agreement was a license, not a lease or easement, and thus not enforceable against the subsequent purchaser.
The Appellate Division’s order was appealed to the New York Court of Appeals.
The Court of Appeals affirmed the Appellate Division’s decision.
Issue(s)
Whether an unrecorded agreement creating an interest in real property for longer than three years is enforceable against a subsequent purchaser who has notice of facilities on the property but not of the agreement itself.
Holding
No, because under sections 290 and 291 of the Real Property Law, such an agreement is void against a subsequent purchaser in good faith for valuable consideration unless the agreement is recorded. Mere notice of the washing machines is insufficient to impute notice of the agreement.
Court’s Reasoning
The court based its decision on the application of Sections 290 and 291 of the Real Property Law. These sections protect subsequent purchasers who acquire property in good faith and for valuable consideration. The court reasoned that because the agreement created an interest in real property for a period exceeding three years, it fell under the purview of Section 291, requiring recordation to be effective against subsequent purchasers.
The court distinguished between notice of the washing machines and notice of the agreement itself. The court stated, “The complaint alleges no more than that defendants had notice of the washing machines, not that they had notice of the agreement. There is, therefore, no allegation of constructive notice of the agreement sufficient to make section 291 inapplicable”. This distinction is crucial because it establishes that a purchaser’s awareness of physical facilities on a property does not automatically imply awareness of any underlying agreements related to those facilities.
The court cited several prior cases, including *Bermann v. Windale Props., General Meter Serv. Corp. v. Manufacturers Trust Co.*, and *Wash-O-Matic Laundry Co. v. 621 Lefferts Ave. Corp.*, to support its holding that notice of the physical presence of equipment is not equivalent to notice of the agreement governing it. This demonstrates a consistent application of the principle that constructive notice requires knowledge of the agreement itself, not merely awareness of related physical installations.
The court explicitly stated that, “Under sections 290 and 291 of the Real Property Law the agreement, whether a license, lease, easement or covenant running with the land, because it creates an interest in real property for longer than three years, “is void as against any person who subsequently purchases or acquires * * * the same real property * * * in good faith for a valuable consideration” (Real Property Law, § 291).”