Nw. Real Estate Co. v. Serio

156 Md. 229, 144 A. 245 (1929)

 

RULE:

The authorities agree that conditions or limitations in restraint of alienation or essential enjoyment of an estate in fee cannot be validly annexed to the deed or devise by which the estate is created, because they are repugnant to the inherent nature and qualities of the estate granted and tend to public inconvenience.

FACTS:

The covenant in the deed that conveyed real property to the vendors in fee simple restricted the vendors' right to sell their property to the grantor's reservation of the right to determine the suitability of any potential purchaser.

ISSUE:

Whether the restraint thus sought to be imposed upon the alienation of the property is void as being repugnant to the granted estate.

ANSWER:

Yes.

CONCLUSION:

The court affirmed the decree that held the covenant was void, and then ordered specific performance of the contract of sale between the vendors and the purchasers. The court held the covenant was an invalid restraint on alienation because on the one hand it gave the vendors a fee simple estate, and on the other hand restrained the vendors' power to sell as fee simple estate to other owners. The fact that the covenant had a limited duration was irrelevant.

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