Constructive Notice and Easements: A Game-Changer for Property Owners

This week we wanted to bring your attention to an interesting decision out of the 2^nd Department which held, in part, that an unrecorded Easement for ingress/egress could be enforced by the benefitted property owner based on Constructive Notice to the burdened property owner. 

The relevant facts of, as well as a link to, the case are set forth below.

In 1975, the Plaintiff and the owner of the adjoining property, the Defendant’s predecessor-in-title, entered into an “Easement” affording access to the Plaintiff’s property through a driveway on what is now the Defendant’s property. The agreement was not recorded.  In 2018, the Defendant’s attorney notified the Plaintiff that it would “be installing…barriers…on their property line” because the tenants of the Plaintiff’s building, and their patrons and vendors, were “utilizing [the defendant’s] parking spaces/parking lot.” The Plaintiff commenced an action to enforce the agreement, seeking monetary damages, declaratory and injunctive relief, and specific performance. The Supreme Court, Putnam County, granted the Plaintiff’s motion for summary judgment, holding that the Plaintiff’s land was entitled to either the easement rights in the agreement or to an easement by necessity. (The two parcels had been in common ownership when the Plaintiff acquired title). The Court found that the Defendant, on taking title to its parcel, was on constructive notice of the possible existence of an easement and therefore had a duty to make further inquiry.

The Appellate Division, Second Department, agreed with the lower court that the Defendant’s land was entitled to the benefits of the agreement. According to the appellate court,

“[a] good faith purchaser for value is not bound by an easement which is not property recorded prior to the purchase of the encumbered property [citations omitted]. However, the purchaser cannot claim good faith purchaser status if it had actual or constructive notice of the easement [citations omitted]. Where there is open and visible use of property by a third person, a purchaser is placed on constructive notice of the possible existence of prior rights [citations omitted]. If no inquiry is made, the purchaser is charged with the knowledge that a reasonable inquiry concerning the defect would have revealed [citations omitted].”

“Here, the evidence in the record demonstrated that the plaintiff’s use of the driveway was open and visible. Thus, the plaintiff established that the defendant had constructive notice of the easement.”

The Appellate Division further held that the Supreme Court had properly denied that part of the summary judgment motion seeking that the court declare the scope of the easement, as the Plaintiff had failed to establish, prima facie, the scope of the easement.

Conwell Properties, Inc. v. DAG Route Six, LLC, 2022 NY Slip Op 06786, decided November 30, 2022, is posted at https://www.nycourts.gov/reporter/3dseries/2022/2022_06786.htm