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A grantor can impose conditions and can make the title conveyed dependent upon a grantee's performance. But if the grantor does not make any condition, but simply expresses the motive which induces him to execute the deed, the legal effect of the granting words cannot be controlled by the language indicating the grantor's motive. It is well established that the law does not favor a construction of the language in a deed which will constitute a condition subsequent unless the intention of the parties to create such a restriction upon the title is clearly manifested. For a reversionary interest to be recognized, the deed must contain express and unambiguous language of reversion or termination upon condition broken. A mere expression of the purpose for which the property is to be used without provision for forfeiture or re-entry is insufficient to create an estate on condition.
By deed dated 4 May 1992 ("the Deed"), Champion International Corporation ("Champion" or "grantor"), as party of the first part, conveyed title to the Camp Hope property to the trustees of the Robertson Memorial Young Men's Christian Association ("YMCA"), as party of the second part, and to the Town, a municipal corporation, as party of the third part. Specifically, the Deed conveyed to the YMCA a fee simple determinable estate in the property so long as the property was used in accordance with certain enumerated express terms and conditions set forth in the Deed. The Deed conveyed to the Town a reversionary interest in the Camp Hope property which would, by operation of law and without re-entry or suit, cause title of the property to revert to the Town should the YMCA violate any of the express terms and conditions. Should the Town take title to the property, the Deed also required that the Town abide by certain enumerated express terms and conditions or risk forfeiting title. If the Town violated the express conditions contained in the Deed, Champion provided that title to the Camp Hope property would, by operation of law and without re-entry or suit, revert to Champion, or its successor corporation, as party of the first part. The YMCA subsequently forfeited its title to the Camp Hope property, and the Town took title to it on 25 July 1996. The Town has held title to the property as party in the third part since that time.
In March 2006, plaintiffs purchased a tract of land adjacent to the Camp Hope property. Soon thereafter, in April 2006, International Paper Company, successor by merger To Champion, assigned and conveyed its reversionary interest in the Camp Hope property to plaintiffs by assignment and Quitclaim Deed recorded in Book 667 at Page 179 in the Haywood County Register of Deeds. Plaintiffs have held a reversionary interest in the property as party in the first part since that time. In April 2005, the Town negotiated a five-year lease agreement with Wellspring Adventure Camp, LLC ("Wellspring") for the operation of a weight loss and fitness summer camp to be located on the Camp Hope property. On 11 April 2006, the Canton Board of Aldermen approved a two-year extension of the lease agreement. Pursuant to the lease terms, Wellspring has primary use and control of the property from 15 May through 15 September each year for the duration of the lease term. Wellspring campers reside throughout the United States and may select the camp location of their choosing. Approximately 978 campers participated in the Wellspring summer camp at the Camp Hope property during the summers of 2005-2011. Of these, only 20 or so campers resided permanently in Haywood or adjoining counties.
A clause in the Deed provides: "the Town will not operate on the property a summer camp primarily for the benefit of residents of other areas and states." Because so few campers resided permanently in the local community, plaintiffs filed suit against the Town based on an alleged violation of this clause, which plaintiffs argued was an express condition. To reflect the jury's determination that the Town did not violate the condition requiring that it not allow a summer camp that primarily benefited residents from other areas and states to operate on the Camp Hope property, the trial court entered an order declaring that the Town retained fee simple determinable title to the property.
Did the trial court err in denying the Town’s motion for a directed verdict?
The Deed did, in fact, contain language of reversion or termination. However, the reversionary language was in reference to the seventeen enumerated conditions, not the clause on which plaintiffs rely. The Deed provides, should the Town cease "to use said property for said purposes" or "violate any of the conditions placed upon [the Town]," title to the property "shall, without re-entry or suit, automatically revert to . . . Champion . . . or its successor corporation." At the outset of the Deed, the grantor specified that both the YMCA and the Town could maintain title only if each used the property in accordance with the "express conditions hereinafter enumerated and no longer." "Enumerate" means "to count off or designate one by one; to list." As cited above, the Deed enumerated seventeen conditions placed upon the Town, none of which reference the clause at issue. Taken as a whole, it is apparent that the grantor intended to trigger reverter only if one of the enumerated conditions was broken. Further, condition #4 serves as a restraint on use, providing that the Town must use the property for recreational purposes. Arguably, if the grantor intended to further restrain the Town's use of the property by prohibiting it from operating a summer camp that primarily benefited residents of other states, it would have done so in an enumerated paragraph. However, the paragraph in which the clause is written was un-numbered and devoid of any express and unambiguous language of reversion upon condition broken. In fact, in their brief, plaintiffs did not direct the court to any reversionary language in direct reference to this clause. Thus, nowhere in the paragraph or in the Deed itself is it "clearly manifested" that title to the property is to revert to Champion, or its successor, upon the Town's violation of the clause. Moreover, the clause was followed by a sentence in which the grantor asks that the Town use its "best efforts" to ensure "that the users of the facilities are those who have historically used the same." The inclusion of such subjective language in this paragraph was additional evidence that the grantor did not envision this paragraph or the clause therein to inflict a rigid restriction upon the title or to create a condition subsequent. Instead, we hold that this clause is precatory. Champion merely sought to express an intended purpose for which the property was (hopefully) not to be used.