Case Law Review

Patch v. Springfield Sch. Distr., 2009 VT 117, 187 Vt. 21 (2009)

Carrie Patch owned a parcel of land next to the Town of Springfield School District (the “District”). Patch knew when she bought the property that the District operated a school on the adjacent land. After Patch acquired title, the District announced plans to expand and develop the school property.  Patch argued the School expansion was precluded because of restrictions contained in Patch’s deed and deeds of other lots in the subdivision of which the District’s lot was originally a part of. The Springfield Zoning board nonetheless granted the permit for the expansion, and Patch brought suit. See, Patch v. Springfield Sch. Distr., 2009 VT 117, 187 Vt. 21 (2009).

The subdivision history is important for this case.

Both Patch’s and the District’s lots were originally part of a larger parcel owned by Sunmount/Douglass Real Estate Corporation (hereinafter “Sunmount”). Id. at 24-25. In 1928, Sunmount created a residential subdivision plan containing over 100 lots. The only recorded instrument relating to that subdivision was a 1928 plan. Id. at 24. In 1929, Sunmount sold the first lot in that subdivision by deed which did not contain a reference to any restrictive covenants. However, the following sixteen lots conveyed out by Sunmount contained restrictive covenants, and one such covenant restricted development of the lots for dwelling purposes only. Id. Patch’s lot was one of the sixteen conveyed subject to this restriction.

Sunmount conveyed the remaining lots to Albert W. LaFountain and William D. Woolson (hereinafter collectively “Woolson” and “Woolson Lots”) in 1938 by deed which “imposed restrictions that may have existed in agreements between Sunmount and previous purchasers on subsequent conveyances.” Id.

The Woolson Lots were sold over the next several years via eleven deeds, ten of which contained the same covenants as those contained in the  earlier Sunmount deeds. Id.

In 1946, the District acquired title to a twelve acre parcel, described by reference to several lot numbers from the 1928 Sunmount plan (the “District Parcel”). No deeds in the chain of title for the District Parcel explicitly restrict use of the land to dwelling purposes nor did the deed to the District contain a covenant explicitly restricting use of the land. Id.

Patch argued that Sunmount created a general plan development for the land described on the 1928 plan. Patch further argued that the deed for the District Parcel and those in its direct chain, incorporated by reference the restrictive covenants contained in the deeds previously sold by Sunmount and its successor. The issue presented before the court was whether the restrictive covenants that are explicitly in the deeds of most the of the properties conveyed by Sunmount and its successor apply to the District’s parcel. Id. at 26.

The Superior Court held that the District Parcel was not subject to the restrictive covenants, and even if it had been, the restrictive covenants were rendered unenforceable by acquiescence, prescription and changed circumstances. Patch appealed that decision to the Vermont Supreme Court. Id. at 23.

On appeal, the Vermont Supreme Court defined covenants as “agreements or promises of two or more parties that something is   done, will be done, or will not be done,” and are “characterized by the type of burden they impose: an affirmative covenant calls for the covenanter to perform an act, while a negative covenant requires the covenanter to refrain from performing one.” (Id. at 26, internal citations omitted. The Court further noted that Vermont “recognize[s] that restrictive covenants can be established via a common development scheme for a general plan development” Id. (referencing Creed v. Clogston, 2004 VT 34, 176 Vt. 436, (2004)). The Court further noted that restrictive covenants can be established “by including restrictions in a deed, which may be accomplished by reference to other deeds” Id. 27. citing Albright v. Fish, 136 Vt. 387, 394, (1978).

Based on the facts, the Court did not find that a restrictive covenant that burdened the District Parcel was created in either of these ways. Id. at 27.

The Court had recently looked at general plan development in Creed v. Clogston, 176 Vt. 436, 2004 VT 34, 852 A.2d 577 (2004). In Creed, the Vermont Supreme Court defined a general plan development as “a real-estate development or neighborhood in which individually owned lots or units are burdened by a servitude imposed to effectuate a plan of land-use controls for the benefit of the property owners in the development or neighborhood.” Creed at 443. The Court said that the neighborhood discussed in the Creed was not a general plan development, because “there was no declaration of covenants imposed before any lots within [the] neighborhood were sold, nor was a subsequent servitude created by existing property owners.” Id.

With Creed as precedent, the Court concluded the District’s Parcel was not part of a general plan development; that Sunmount did not create a general plan development. Neither the 1928 plat nor the first deed, contained any reference to restrictive covenants. Patch at 28. The Court held “[t]he mere existence of a recorded plat map does not constitute the creation of a general plan development….[and] [c]ovenants in individual deeds cannot constitute a ‘declaration’ of covenants.” Id. It was important to the Court in Patch that the first lot sold contained NO covenants at all.

Patch argued Sunmount’s intent was important in the analysis.  Id. at 29. Patch argued that Sunmount intended to create a general plan development and intended the Woolson Lots to be bound by the restrictions because of the inclusion of language in the 1938 deed regarding “subject to any building restrictions and conditions…”  Id. The Court noted intent is a piece of the analysis, but intent alone cannot create a general plan development.”  Further the Court held that intent has “little, if any, bearing…where express language is lacking.” Id. The Court stated the more crucial elements not present in this case were the declaration of covenants imposed before the first lot was sold, and the lack of a subsequent agreement among all lot owners to impose a set of covenants. Id. at 30.

The Court disagreed with Patch’s second argument that the deeds in the District Parcel chain incorporate by reference the restrictive covenants. The crucial element in the District’s deed, as distinguished to deeds and caselaw cited by Patch, was that the reference to covenants was conditional. Id. The deed stated that any conveyances by Woolson to subsequent purchasers would be subject to the Sunmount restrictions “only if” the Sunmount restrictions created a legally binding obligation. Id. at 31. The Court did not find that there were legally binding obligations without a declaration of covenants recorded either with or before the first deed out, or, again, by all lot owners. Id. at 32. The conditional nature of the incorporation by reference was key in the Court’s finding in the District’s favor.

Patch made a third argument applying the doctrine of reciprocal negative easements however the Court held such reciprocal negative easements would only exist if a general plan development had been created. Id.

The Court did not discuss whether the covenants had been rendered unenforceable by acquiescence, prescription or changed circumstances because the District Parcel was never subject to the covenants. Id. at 34. 

This case highlights the elements to look for when a parcel may be part of a general plan development. Sometimes it may be important to search back to initial developers in a subdivision to determine when the first deed for a lot was conveyed and what it contained and what else may have been of record at that time regarding covenants and restrictions. Whether there may be a general plan development is not always clear.