Brief Fact Summary. This case involves a dispute, in which, a church utilized a lot for parking, and this use was reserved in the deed, however, when it was conveyed to a third person, it did not contain the express reservation.
Synopsis of Rule of Law. The court will look to the intent of the grantor in determining whether a conveyance contains an easement to a third party.
While a reservation could theoretically vest an interest in a third party, the early common law courts vigorously rejected this possibility, apparently because they mistrusted and wished to limit conveyance by deed as a substitute for livery by seisin.View Full Point of Law
Issue. May the grantor, in deeding real property to one person, effectively reserve an interest in the property to another?
Held. Yes. Judgment reversed.
The court will not be bound by the feudal forms of conveyancing, but instead will recognize, as its primary objective in construing a conveyance, to try to give effect to the intent of the grantor. This is a holding that grants are to be interpreted in a similar fashion to contracts and not according to rigid feudal standards.
The court cites cases in other jurisdictions and in this jurisdiction, which contain numerous exceptions to the common law rule that one cannot reserve an interest in property to a stranger in title. The court is following the lead of Oregon and Kentucky by abandoning the rule altogether, rather than to continue to try and apply the common law rule piecemeal.
The Plaintiff contended that the old rule should apply in this case to deny the church an easement, because both the grantees and title insurers have relied on the old rule. The court pointed out that no title insurance was written on the deed, Plaintiff was aware of the church’s use of the lot for parking, and that Plaintiff did not even read the deed containing the reservation.
The court held that in applying the new rule to grants made prior to this decision, the court will decide whether to apply the old or new rule by balancing the injustice which might result under the old rule against the injustice which might result under the new rule.
The trial court found that the intention of the parties (McGuigan and Peterson) was to give an easement to the church, so the reservation clause was sufficient to create an easement.
Discussion. This case would be decided differently in many other jurisdictions.