An encumbrance is defined as every right to or interest in the land which may subsist in third persons, to the diminution of the value of the land, but consistent with the passing of the fee by the conveyance. All encumbrances may be classed as either (1) a pecuniary charge against the premises, such as mortgages, judgment liens, tax liens, or assessments, or (2) estates or interests in the property less than the fee, like leases, life estates or dower rights, or (3) easements or servitudes on the land, such as rights of way, restrictive covenants and profits.
The defendant's brother and predecessor in title, Paul DiLoreto, subdivided a parcel of land located in Old Saybrook for the purpose of constructing residences on each of the two resulting parcels. DiLoreto built a bulkhead and filled that portion of the subject parcel immediately adjacent to the wetlands area, and then proceeded with the construction of a dwelling on the property. On February 21, 1984, DiLoreto transferred the subject property to the defendant by quit claim deed. On December 31, 1985, the defendant conveyed the property to the plaintiff by warranty deed, free and clear of all encumbrances but subject to all building, building line and zoning restrictions as well as easements and restrictions of record.
During the summer of 1986, the plaintiff decided to perform repairs on the bulkhead and the filled area of the property. The plaintiff engaged an engineering firm which wrote to the state department of environmental protection (DEP) requesting a survey of the tidal wetlands on the property. On April 13, 1988, as confirmation of that meeting, Denis Cunningham, the assistant director of the DEP water resources unit, wrote to the plaintiff to advise him that the filled and bulkheaded portion of the property, and possibly the northwest corner of the house were encroaching on the tidal wetlands boundary, thereby creating a violation of General Statutes § 22a-30.
The defendant appeals from the judgment of the trial court awarding the plaintiff damages for breach of the warranty against encumbrances and innocent misrepresentation of real property that the defendant conveyed to the plaintiff by warranty deed.
Does an alleged latent violation of a land use statute or regulation, existing on the land at the time title is conveyed, constitute an encumbrance such that the conveyance breaches the grantor's covenant against encumbrances?
The court adopted the reasoning of Fahmie v. Wulster, supra, and thus held that the concept of encumbrances cannot be expanded to include latent conditions on property that are in violation of statutes or government regulations. To do so would create uncertainty in the law of conveyances, title searches and title insurance. The parties to a conveyance of real property can adequately protect themselves from such conditions by including protective language in the contract and by insisting on appropriate provisions in the deed. As the Illinois Appellate Court held in Monti v. Tangora, supra, 582, "[t]he problem created by the existence of code violations is not one to be resolved by the courts, but is one that can be handled quite easily by the draftsmen of contracts for sale and of deeds. All that is required of the law on this point is that it be certain. Once certainty is achieved, parties and their draftsmen may place rights and obligations where they will. It is the stability in real estate transactions that is of paramount importance here."