PIERCE v. DENNETT et al.

Supreme Court of Georgia1927-01-12No. No. 5395

163 Ga. 471

Summary · law.co

Holding. The court reversed the trial court's judgment, holding that a recorded bond for title provides constructive notice of its restrictive covenants to all subsequent purchasers and transferees, and that such restrictions remain enforceable even after the bond is merged into a later warranty deed when the restrictions are part of a general building scheme for the subdivision.

Peachtree Hills Realty Company executed a recorded bond for title to George R. Leukhardt containing covenants restricting the lot to residential purposes and establishing building setback requirements. This bond was transferred through several owners and eventually Mrs. N. W. Dennett conveyed the property to Mrs. Minnie Mae Jackson by warranty deed, which included similar but slightly modified restrictions. The central question was whether Mrs. Jackson, as the final grantee, had constructive notice of the original restrictive covenants contained in the earlier recorded bond for title.

The court held that a recorded bond for title constitutes a muniment of title and provides constructive notice to the world of the rights and interests described within it. Subsequent purchasers and transferees are charged with notice of the bond's terms and conditions, including any building restrictions. Although a bond for title is typically merged into a subsequent deed, such merger does not eliminate building restrictions that form part of a general development scheme for a subdivision. The trial court therefore erred in failing to grant an injunction to enforce these restrictions.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether a recorded bond for title provides constructive notice of restrictive covenants to subsequent purchasers
Whether restrictive covenants survive the merger of a bond for title into a warranty deed
Whether a general building scheme prevents the abrogation of lot restrictions through subsequent conveyances

Procedural posture

The trial court denied an injunction to enforce restrictive building covenants, and the court of appeals reversed.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Hill, J.

(After stating the foregoing facts.) The record in this case discloses that Peachtree Hills Realty Company Inc. executed to George R. Leukhardt a bond for title to lot 24 in block 6 of Peachtree Hills Place (the lot in controversy), the bond containing, among others, the covenant that “the above property is sold for residence purposes only, unless otherwise specified; and all such buildings shall conform to the thirty-foot building line on the plat, and shall be at least ten feet from the side line of any lot owned by others.” This bond for title was properly witnessed and recorded. It thus appears that the Peachtree Hills Realty Company Inc., which purchased the property formerly owned by the American Securities Company, adopted the general building scheme of the original owners of the Peachtree Hills subdivision, viz., the American Securities Company of Georgia, and incorporated in their bond for title the same building restrictions as set out in the bond for titles from Peachtree Hills Realty Company Inc. to George R. Leukhardt. This bond for title was transferred to Mrs. George R. Leukhardt, and by Mrs. Leukhardt to Mrs. N. W. Dennett, and recorded March 1, 1923. Mrs. N. W. Dennett executed a warranty deed to Mrs. Minnie Mae Jackson, dated February 26, 1926, to the lot in question. The deed contained the following: “The above property is subject to the following covenants, limitations, and conditions: . . The above property is sold for residence purposes only, unless otherwise specified, and all such buildings shall conform to the thirty-foot building line on the plat, and shall be at least five feet from the side line of any lot owned by others.” This deed was properly witnessed, and was recorded on March 2, 1926. One of the questions for decision is whether Mrs. Jackson, the last grantee of lot No. 24, is chargeable with notice of the restrictions in the bond for title, as set out above, of her predecessors in title. On the following authorities we are of the opinion that Mrs. Dennett took whatever interest she had in the lot in controversy with constructive notice of the restrictive use to which the lot could be put, and that the recorded bond for title was a part of the muniment of title of Mrs. Minnie Mae Jackson, and she was chargeable with notice of the restrictions in the bond for titles.

A bond for title is a muniment of title. “Bond for titles, with all the purchase-money paid, is a complete title to land; and the vendor has no property in that land, remaining in him, whereon to grant administration after his death.” Adams v. Brooks, 35 Ga. 63-4. A bond for title is admissible in evidence as color of title, and may be the basis of a prescription against any person other than the obligor in the bond. Burdell v. Blain, 66 Ga. 169; Garrett v. Adrain, 44 Ga. 274; Carstarphen v. Holt, 96 Ga. 703 (23 S. E. 904). A purchaser of land, under a bond for title, who subsequently pays the purchase-money and takes a deed, may, in a suit for breach of warranty in the deed, put in evidence the bond for title, as a part of the history of the transaction, and to show that the defendants were bound to make him a good warranty title. Clark v. Whitehead, 47 Ga. 516 (3). A recorded bond for title is notice to the world of the right and interest of the obligee to the land described therein, and of the right and interest of subsequent transferees thereof in such land.- Ga. Laws 1921, p. 157. Such bond for title, being duly recorded, is notice to a purchaser from the last transferee thereof of its terms and conditions, and of any building restrictions therein contained. While generally a bond for title is merged in a subsequent deed made to the purchaser of the premises by the obligor, such deed would not have the effect of abrogating “a general building scheme” under which lots in a subdivision were sold. It follows that the trial judge erred in not granting an injunction. See Hancock v. Gumm, 151 Ga. 667 (3) (107 S. E. 872, 16 A. L. R. 1003).

Other headnotes do not require elaboration.

Judgment reversed.

All the Justices concur, except Bussell, C. J., and Gilbert, J., who dissent.