| Cone v Stranahan |
| 2007 NY Slip Op 07801 [44 AD3d 1145] |
| October 18, 2007 |
| Appellate Division, Third Department |
| Nichola P. Cone, Respondent, v Daniel J. Stranahan,Appellant. |
—[*1] Brennan & White, L.L.P., Queensbury (Daniel J. Stewart of counsel), forrespondent.
Cardona, P.J. Appeal from an order of the Supreme Court (Krogmann, J.), entered July 13,2006 in Warren County, which, among other things, granted plaintiff's motion for summaryjudgment.
In the fall of 2005, plaintiff approached defendant about the purchase of a parcel ofunimproved land owned by defendant in the Town of Queensbury, Warren County. Beforeplaintiff made an offer, defendant informed her that there were "wetlands at the rear of theproperty" and, during an inspection of the parcel, plaintiff saw several piles of dirt that had beendumped thereon. Thereafter, on October 3, 2005, the parties executed a contract of sale, draftedby plaintiff's attorney, with a selling price of $65,000. No deposit was required of plaintiff, theinspection contingency clauses were waived and the contract called for a closing on October 14,2005.
Prior to closing, however, a title search revealed that the property was encumbered by twoworkers' compensation liens. After an exchange of letters over the next few months, the partiesresolved that issue by means of an escrow account. Subsequently, by letter dated January 5, 2006,plaintiff's counsel informed defendant's counsel of a new problem related to possible issues withthe Adirondack Park Agency (hereinafter APA). Specifically, plaintiff, concerned over severalloads of construction fill that defendant apparently dumped onto the property after thecontract date, made inquiry to the APA as to whether the dumping might be in violation of [*2]regulations. The APA then informed defendant that it wascommencing an investigation to determine whether defendant was "[f]illing wetlands subject to[APA] jurisdiction without a permit, and creation of a waste disposal area without a permit."Plaintiff requested that defendant provide her with confirmation from the APA that there were noviolations and defendant refused, indicating that he was not obligated to do so. By letter datedFebruary 9, 2006, defendant gave notice to plaintiff that time was of the essence and scheduled aclosing date eight days later, which plaintiff failed to attend.
Thereafter, plaintiff commenced this action seeking specific performance of the contract andan order requiring defendant to comply with the APA investigation, providing assurances thatthere were no violations of the regulations. After joinder of issue, the parties cross-moved forsummary judgment and Supreme Court granted plaintiff's motion, finding that defendant failed toconvey a marketable title in accordance with his contractual obligations. Defendant was furtherdirected to cooperate with the APA investigation and, if no violations were discovered, transferthe property to plaintiff.
We agree with defendant's argument that title was not rendered unmarketable because of thepossibility that his actions violated APA regulations. Even an established violation of a zoningordinance does not render title unmarketable in the absence of a specific representation to thateffect by the seller,[FN1]inasmuch as "marketability of title is concerned with impairments on title to a property, i.e., theright to unencumbered ownership and possession, not with legal public regulation of the use ofthe property" (Voorheesville Rod & Gun Club v Tompkins Co., 82 NY2d 564, 571[1993]; see Vandervort v Higginsbotham, 222 AD2d 831, 832 [1995]). Indeed, even thepossible presence of environmental hazards on property does not implicate marketability of title,regardless of any potential remediation which might be required of the owner, since such asituation affects the property's value, not "one's right to 'unencumbered ownership andpossession' " (Vandervort v Higginsbotham, 222 AD2d at 832, quoting VoorheesvilleRod & Gun Club v Tompkins Co., 82 NY2d at 571).
Here, given the absence of a legitimate reason for plaintiff to refuse to close on the groundthat title was unmarketable, summary judgment on that basis should not have been [*3]granted. Furthermore, since the contract contains no inspectioncontingencies and imposes no affirmative duties on defendant, the direction that he await theresults of an APA investigation prior to closing was improper. As it stands, while plaintiff'slawsuit ostensibly seeks specific performance, the practical effect is that it seeks to utilize thecourts to impose inspection obligations upon defendant that not only were not included in theparties' contract (see Voorheesville Rod & Gun Club v Tompkins Co., 82 NY2d at 572),but, in fact, concerned matters of which plaintiff was aware before the execution of the contract,i.e., the fill dumping, and, therefore, could have addressed at that time (cf. East 15360 Corp. vProvident Loan Socy. of N.Y., 177 AD2d 280, 281 [1991]). In light of the contract terms,defendant acted within his rights, following the resolution of the escrow issue, by declaring timeto be of the essence and scheduling a closing.[FN2]Since plaintiff did not attend, defendant was justified in indicating that the contract wasterminated in accordance with its terms (see id. at 282).[FN3]
Accordingly, we reverse the award of summary judgment in plaintiff's favor and grantdefendant's cross motion for summary judgment dismissing the complaint.
Mercure, Peters, Spain and Carpinello, JJ., concur. Ordered that the order is reversed, on thelaw, with costs, plaintiff's motion denied, defendant's cross motion granted, summary judgmentawarded to defendant and complaint dismissed.
Footnote 1: We note that, unlike a situationwhere a contract contains a provision where the seller warrants that a property will not be inviolation of any zoning ordinance at the time of transfer (see e.g. Voorheesville Rod& Gun Club v Tompkins Co., 82 NY2d 564, 572 [1993]), here, the contract indicated thatthe seller would only warrant that zoning and environmental laws would not be "violated by thebuildings and improvements erected on the property." Given that the contract must be construedmost strongly against plaintiff, the drafter (see Agostinelli v Stein, 17 AD3d 982, 985 [2005], lvdismissed 5 NY3d 824 [2005]), any contention that the provision could be interpreted toapply to the piles of construction fill on defendant's property is not persuasive.
Footnote 2: We note that although plaintiffargues that defendant's dumping of construction fill on the property subsequent to execution ofthe contract should be considered a separate breach thereof, in that regard, the contract stated thatplaintiff had the right to inspect the property within 48 hours prior to the closing date to"ascertain there has been no material change in the condition of the property from the time ofcontract." Since plaintiff indicated that she would not attend a closing unless she received a"clearance" letter from the APA, issues related to that contract clause were never explored.
Footnote 3: Notably, the contract specifiedthat, in the event it was terminated, defendant's only remedy was to retain plaintiff's deposit,which in this case was zero. Defendant indicated on several occasions that he had no difficultywith both parties simply walking away from the transaction.