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DePeyster v. Michael

    Brief Fact Summary. The defendant purchased lease property in fee simple, and that lease contained a clause requiring all lessees to give the lessor quarter sales of all profits from the lease. When the original lessee sold his rights of the lease to the defendant, he did not give the lessor a quarter of the sales. The lessor then moved to eject the defendant from the premises.

    Synopsis of Rule of Law. Conditions upon a lease in fee simple to give the lessor quarter sales of all profits when selling that lease, amounts to an improper alienation restraint and is repugnant to the estate and therefore void.

    Facts.  

     

    A lease was made between Mr. Rensselaer, the lessor, and Mr. Snyder the lessee. Both parties assigned his rights to the lease to other parties. The lessor assigned his right to lease to the plaintiff Mr. DePyester, and the lessee assigned his rights to the defendant Mr. Michael. The lease was for forty-eight bushels of wheat and a few conditions. Condition one; was that quarter sales of all profits made by the lessee his heirs and assigns to be given to the lessor. Profits included the sale, renting of, or assigning of the lease. Condition two; the lessor had the first right of refusal of all sales of the premises. Condition three; upon refusal to purchase if the lessee did not give one-fourth of the profits from that sale then the lessor has the right to eject the lessor. Condition four; if the lessee becomes more than forty days late on his rent then the lessor could also eject the lessee. Facts at trial showed that the premises was sold to the defendant and the lessor, here the plaintiff, was not given one-quarter of that sale. The lessor moved to eject the new lessee that was assigned the premises.

    Issue. Whether condition that the lessee must pay the quarter sales upon alienation of the lease is a valid condition upon the lease that grants an estate in fee simple.

    Held.  A condition that requires quarter sales upon alienation of property is an invalid restraint on alienation. This kind of condition upon estates for years and estates for lives had traditionally been held valid. However the lease being described as to the lessee his heirs and assigns makes this a fee simple.  When a person owns a land in fee simple typically any condition upon the use of that land is void. Partiers are not allowed to agree or contract rights of alienation or enjoyment of the fruits of a property because the legal nature of a fee simple estate does not allow it. Defendant argues that conditions to pay a quarter sales are repugnant to the estate in fee granted by the lease and the court agrees. The ownership of a fee simple cannot exist in one person, here the lessee, while the lessor has the right to alienate the property or enjoy the fruits of the property. That is not a fee simple. We do not allow alienation restrictions because this is how land was owned in England where a property owner never really owned his property but his lord did. America does not promote this type of ownership, but promotes independence.  The only proper condition to this property is the paying of rents that are due under this lease.

    Discussion. Conditions upon alienation of a fee simple are repugnant in nature and parties are not allowed to make contracts that allow otherwise. Any condition upon an estate in fee simple that is a restriction on alienation, even a partial restraint, will be condition void.


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