Eagle Enterprises, Inc. v. Gross

Brief Fact Summary.

Plaintiff filed suit seeking enforcement of the covenant and to compel Gross to accept and pay for the water.

Synopsis of Rule of Law.

If there is privity of estate between the parties contesting a covenant, and the covenant “touches and concerns” the land with which it runs, the covenant is enforceable if the original grantor and grantee so intended.

Facts.

The deed from the original sale of property contained a provision that required a purchase of water from May to October of each year for an annual $35 fee. The deed stated that the covenant was to run with the land. Defendant Gross is a subsequent owner. Plaintiff Eagle Enterprises, Inc. is a successor to Orchard Hill. Gross refused to take delivery of and to pay for water offered by plaintiff. Plaintiff filed suit seeking enforcement of the covenant and to compel Gross to accept and pay for the water.

Issue.

If there is privity of estate between the parties contesting a covenant, and the covenant “touches and concerns” the land with which it runs, the covenant is enforceable if the original grantor and grantee so intended.

Held.

No. Accordingly, the appellate division is affirmed.

Discussion.

In this case, the covenant to receive and pay for water does not substantially affect defendant’s ownership of the land or his rights. Therefore, the obligation to receive water supplied by the plaintiff is a contractual obligation.