Hawthorne v. Realty Syndicate, Inc.

259 S.E.2d 591 (1979)

43 N.C. App. 436

Thomas J. HAWTHORNE, and wife Charlotte M. Hawthorne, Jerome Milton, and wife Mary Sue Mock Milton, C. Carl Warren, Jr., and wife Josephine L. Warren v. REALTY SYNDICATE, INC., Marsh Realty Company, and Marsh Foundation, Inc.

No. 7826SC1106.

Court of Appeals of North Carolina.

November 6, 1979.

*593 Ruff, Bond, Cobb, Wade & McNair by Hamlin L. Wade, Charlotte, for plaintiffs-appellants.

Helms, Mulliss & Johnston by Fred B. Helms and Robert B. Cordle, Charlotte, for defendants-appellees.

ERWIN, Judge.

Defendants' contention that plaintiffs' action is barred by the applicable statute of limitations is without merit. Plaintiffs filed suit to enforce a restrictive covenant. A restrictive covenant is a servitude, commonly referred to as a negative easement, Craven County v. Trust Co., 237 N.C. 502, 75 S.E.2d 620 (1953), and an easement is an incorporeal hereditament. Davis v. Robinson, 189 N.C. 589, 127 S.E. 697 (1925). G.S. 1-50(3) requires that an action for injury to any incorporeal hereditament be brought within six years. Plaintiffs' action was clearly brought within this period.

Defendants' contention that plaintiffs are barred from enforcing the restrictive covenant, regardless of the existence of a general scheme of development, because they are not adjoining lot owners is without merit.

In ascertaining the enforceability of restrictive covenants by persons not party thereto, it must be determined whether the grantor intended to create a negative easement for their benefit. See Lamica v. Gerdes, 270 N.C. 85, 153 S.E.2d 814 (1967); Property Owners' Assoc. v. Current and Property Owners' Assoc. v. Moore, 35 N.C. App. 135, 240 S.E.2d 503 (1978).

In a deed executed on 23 November 1911, the Stephens Company conveyed Lot 5 of Block 7 with the following covenant: "The foregoing restrictions and covenants are substantially similar to those contained in deeds to adjoining lot owners and are for the mutal [sic] protection of such lot owners." *594 Defendants' deed to Lot 6 of Block 7 from George Stephens was executed on 1 January 1912 and contained the same covenant. Their deed to Lot 7 of Block 7 recited: "It is expressly understood and agreed by the parties hereto that all of the foregoing covenants, conditions and restrictions, which are for the protection and general welfare of the community, shall be covenants running with the land." When Block 9 of the subdivision was developed, the deeds retained the same covenant stated in defendants' deed to Lot 7 of Block 7. From the various language stated in the respective deeds, it is clear that the grantors intended the covenants to be enforceable by all the lot owners in Blocks 7 and 9, not just the adjoining lot owners. To find otherwise would run counter to the interest of the court and the developers in the orderly development of land. Here, the respective grantors inaccurately used the word adjoining to mean nearby. The covenant was for the mutual protection of those lot owners nearby.

Defendants argue that the lot owners in Block 9 should not be allowed to enforce restrictive covenants in Block 7. Whether lot owners in Block 9 are entitled to enforce restrictive covenants on lot owners in Block 7 is dependent largely upon whether the developers of the property treated and dealt with the two areas as a single unit and intended the restrictive covenants, easements, to cover both tracts, or whether the two blocks were treated and dealt with as separate, independent units, with intent of the developers and purchasers that the restrictions be limited to each block. Craven County v. Trust Co., supra.

Four factors of central importance in determining whether divisional or single unit development was intended are: (1) the way in which the land in question is platted; (2) the scope of any provision for altering the restrictions imposed; (3) the express limitations on the extent of the restrictions imposed by the conveyance; and (4) the similarity of restrictions between subdivisions. 52 Cornell Law Quarterly 611, 613 (1967).

Blocks 7 and 9 are platted together. The restrictions are said to be "for the mutual protection" of adjoiningnearby lot owners, and "for the protection and general welfare of the community." The restrictions contained in the deeds in Blocks 7 and 9 are substantially similar, although not identical. These crucial factors impel us to hold that Blocks 7 and 9 were treated and dealt with by the developers and purchasers as one single unit. We hold that lot owners in Block 9 are proper parties to enforce the restrictive covenant.

Defendants contend that plaintiffs are barred from enforcing the restrictive covenants, because: (1) the racial restriction in the covenant limiting the properties Lots 6 and 7 to occupancy and ownership by whites only makes the limitation to residential use unenforceable; (2) a radical and fundamental change in the neighborhood has occurred; (3) rezoning of the neighborhood makes enforcement of the covenant inequitable; and (4) plaintiffs have waived their rights to enforce the covenant. We disagree.

Racial restrictive covenants prohibiting the sale or use of real property by a particular racial group are unenforceable today either in equity, Shelley v. Kraemer, 334 U.S. 1, 68 S. Ct. 836, 92 L. Ed. 1161, 3 A.L.R.2d 441 (1948), or at law in an action for damages. Barrows v. Jackson, 346 U.S. 249, 73 S. Ct. 1031, 97 L. Ed. 1586 (1953). Similarly, all racial discrimination, private as well as public, in the sale or rental of property is forbidden. Jones v. Mayer Co., 392 U.S. 409, 88 S. Ct. 2186, 20 L. Ed. 2d 1189 (1968). Nevertheless, the limitation to residential use is valid. The proper remedy, when a conveyance is made which contains such void covenants, is to give full effect to the conveyance but read out the invalid restriction. See Terry v. Elmwood Cemetery, 307 F. Supp. 369 (N.D.Ala.1969); J. Webster, Real Estate Law in North Carolina § 346 (1971).

Defendants' contention that a radical and fundamental change in the neighborhood precludes the enforcement of the restrictive covenant is meritless.

*595 The only changes that the trial court found had occurred in the neighborhood were the construction of a branch of the Charlotte-Mecklenburg County Public Library and the construction of some multi-unit apartment buildings. We note that the record reveals that plaintiffs, the Hawthornes and Warrens, had also waived enforcement of the restrictions as to another lot in Block 7.

In Cotton Mills v. Vaughan, 24 N.C.App. 696, 212 S.E.2d 199 (1975), we held that the use of four of sixty-two lots subject to residential covenants for a snack bar, automobile repair shop, used-car lot, and a fabric shop did not constitute such a radical or fundamental change in the character of the community as to warrant removal of the residential restrictions. In the case at hand, practically all the residents of Blocks 7 and 9 joined in waiving enforcement restrictions to allow for construction of the public library, including defendants' predecessors in interest. The construction of the apartment buildings was not in violation of the covenant restricting the land to residential use. Huntington v. Dennis, 195 N.C. 759, 143 S.E. 521 (1928); DeLaney v. Van-Ness, 193 N.C. 721, 138 S.E. 28 (1927). Although the Hawthornes and Warrens waived their right to enforce the restrictive covenants as to Lot 4 of Block 7, they expressly reserved the right to enforce the restrictions as to other lots in Block 7. Their waiver of rights was a matter of contract. The construction of the public library and the waiver of enforcement of the restrictions were not such a radical and substantial change in the neighborhood so as to defeat the purpose of the restriction, see Building Co. v. Peacock, 7 N.C.App. 77, 171 S.E.2d 193 (1969), and the Hawthornes' and Warrens' execution of the waiver agreement did not estop them from enforcing the covenant against defendants.

Defendants' contention that the change in zoning makes it inequitable to enforce the restrictive covenant is without merit. Suffice it to say that a mere change in a zoning ordinance does not nullify or supercede a valid restriction on the use of real property, Tull v. Doctors Building, Inc., 255 N.C. 23, 120 S.E.2d 817 (1961); Mills v. Enterprises, Inc., 36 N.C.App. 410, 244 S.E.2d 469, dis. rev. denied, 295 N.C. 551, 248 S.E.2d 727 (1978); Building Co. v. Peacock, supra, and the trial court properly excluded evidence of changes occurring outside the community. Brenizer v. Stephens, 220 N.C. 395, 17 S.E.2d 471 (1941); Mills v. Enterprises, Inc., supra.

In its conclusions of law, the trial court found a substantial, fundamental, and radical change in the community, a waiver of the Hawthornes' rights, and that Block 9 of the subject subdivision was separable from Block 7. Based on the foregoing text of our opinion and the trial court's own findings of fact, we hold that issuance of injunctive relief was appropriate. We need not consider plaintiffs' other assignments of error.

The judgment entered below is

Reversed and remanded.

CLARK and WELLS, JJ., concur.