WOLFF v. FALLON

Reset A A Font size: Print

District Court of Appeal, First District, Division 2, California.

WOLFF v. FALLON et al.*

Civ. 15789.

Decided: April 30, 1954

John A. Gorfinkel, Julian W. Mack II, San Francisco, for appellants. Jefferson E. Peyser, Dan Francisco, for respondent.

This is an appeal from a judgment in favor of plaintiff in a suit for declaratory relief and to quiet title against certain building restrictions imposed upon the real property here involved by the original subdividers. The individual defendants are property owners of parcels of property in Ingleside Terraces in San Francisco. Ingleside Terraces Home Owners Association, a nonprofit corporation, intervened on behalf of all property owners in the tract. It was the contention of plaintiff at the trial that the restrictions, valid and enforceable when imposed, were no longer binding or enforceable because of the changed conditions in the neighborhood. The trial court quieted title against all restrictions except the 15 ft. building line ‘set-back’ on Paloma Avenue. Defendants and intervenor have appealed.

Ingleside Terraces, a residential district, is bounded by Ocean Avenue on the north, Ashton on the east, Holloway on the south, and Junipero Serra Boulevard on the west, except for a small corner at the intersection of Ocean Avenue and Junipero Serra Boulevard. There are more than 700 lots in the tract, of which only 7 or 8 were vacant at the time of trial. Approximately 741 lots in Ingleside Terraces were originally reserved for residential purposes.

The Urban Realty Company was the original subdivider. In the original plan two specific areas of the tract were excepted from the restrictions. The entire tract, other than the unrestricted area was subdivided as a ‘high class' residential district. The following restrictions were contained in the grant deeds of the original grantees:

(a) that no building or structure except a one-family dwelling house or appurtenances thereto, to be used exclusively as a dwelling house shall be placed upon each lot;

(b) that no flats, duplexes, apartments, lodging or boarding houses or hotels shall be erected thereon;

(c) that no main wall of any building shall be nearer to the street line than the building line;

(d) that no house, appurtenance or outbuilding shall be less than 4 feet from the northerly exterior side of any lot, nor less than 10 feet from the exterior southerly line of any lot, and in the case of lots having easterly and westerly side lines that no improvements shall be erected within less than 4 feet of such exterior easterly line or within less than 10 feet of said exterior westerly side line of such lots.

(e) that no building shall be more than 2 stories in height, and shall not exceed 21 feet in height from the top of the floor of the first story to the underside of the ceiling of the second story.

The deeds to all original grantees of the Urban Realty Company, including that of plaintiff's predecessor in interest contained such restrictions. These deeds further provided that said restrictions constituted covenants real running with the land, and that each and every part of Ingleside Terraces constituted an easement appurtenant to each and every portion of said tract.

Plaintiff Wolff is the legal owner of lot 14 in block 2 of the tract, but holds title as trustee for Julian W. Weston who furnished the consideration for the purchase price. Weston had agreed to purchase the lot in 1938 on condition that it could be conveyed to him free of the above restrictions. A quiet title action entitled Liebman v. Choynski was brought in Superior Court in San Francisco to secure relief against the restrictions. Judgment granting such relief was entered, and the property was thereafter conveyed to Weston's nominee. However, this judgment was subsequently vacated on the ground that the real parties in interest had not been made defendants and the order vacating said judgment was affirmed on appeal. 37 Cal.App.2d 565, 99 P.2d 1119.

The lot here in question, lot 14 in block 2, is the corner lot at the southwest corner of Ocean Avenue and Paloma Avenue. It has a frontage of 113 feet on Ocean and 50 feet on Paloma. All the remaining lots in this block fronting on Ocean and extending westerly to Junipero Serra Boulevard are within the unrestricted area. All lots fronting on Paloma on both sides of said street are subject to the restrictions.

Every lot in the tract originally conveyed subject to the restrictions with the exception of the vacant lots (of which plaintiff's is one) is now occupied by a single family residence. The only commercial structure on any lot originally subject to the restrictions is a popcorn stand and dental offices on the southeast corner of Victoria and Ocean Avenue.

The area on the north side of Ocean Avenue across the street from Ingleside Terraces is known as Balboa Terraces. They are subject to an ‘exclusively family residence’ restriction. The side of Ocean Avenue opposite Ingleside Terraces is occupied by The Commodore Sloat Grade School, St. Francis Church, property of the Aptos Junior High School and single family residences. There is no commercial structure on the north side of Ocean Avenue in the block opposite plaintiff's lot or in the blocks from there westerly to Junipero Serra Boulevard or easterly for 3 blocks. There has been a street car line on Ocean Avenue since before 1920.

Since 1913 when the deed restrictions were imposed, and particularly since 1937 there has been a substantial increase in motor, street car and pedestrian traffic and in traffic noises on that part of Ocean Avenue bordering respondent's lot.

The value of plaintiff's lot for single family residence purposes is estimated at between $3,000 and $4,000. Its value for unrestricted commercial use is between $15,000 and $17,000. The lot would not be readily saleable if improved with a single family dwelling, partly because it is adjacent to the unrestricted area, partly because lots on Ocean Avenue are not as desirable as other lots in the vicinity, and partly because of the slope of the lot and the fact that it is on the south side of the street. The residence fronting on Paloma Avenue and adjoining plaintiff's lot to the south is valued at between $15,500 and $18,000, while the residence on the southeast corner of Paloma and Ocean, directly across Paloma Avenue from respondent's lot, is valued at between $23,000 and $24,000. A new home in Balboa Terraces on the opposite side of Ocean Avenue and slightly east of respondent's lot is valued in excess of $20,000.

Building on the unrestricted area west of respondent's lot began about 1923. It was then improved with one family cottage type detached residences. These residences were subsequently converted to commercial use, and the entire block with the exception of 4 parcels, is now occupied by commercial enterprises or medical offices. At the time of the trial 883 feet out of 963 front feet were being used for non-residential purposes. The block contained a market, a gasoline service station, retail stores, gas and electric sub-station, medical and dental offices, real estate offices, cleaning and dyeing establishment, beauty salon, pharmacy, photographic studio, and a dance studio.

In 1921 Block 2, including respondent's lot, was zoned and classified by the City and County of San Francisco as a ‘Commercial District.’

By 1938, 8 lots out of 20 and 480 feet of the 963 feet frontage of Block 2 were used for nonresidential purposes. Between 1942 and 1952, 8 more buildings in the block had been converted to non-residential use.

Appellants contend that in order to secure relief against such restrictions respondent must, under the California cases, show that (1) there has been a change in the neighborhood; (2) that such changed conditions have rendered useless the original purpose of the restrictions to the extent that it would be inequitable to enforce them; (3) that the property is unsuitable or useless for the purposes for which it was restricted—it is not sufficient that its unrestricted use would be more valuable; (4) it must be in the best interest of the entire area and not just in the best interest of plaintiff's lot; (5) maintenance of the restrictions will not restore or preserve the locality as a residential area; (6) unrestricted use of plaintiff's lot will not damage or adversely affect other property in the vicinity. Marra v. Aetna Const. Co., 15 Cal.2d 375, 101 P.2d 490; Hurd v. Albert, 214 Cal. 15, 3 P.2d 545, 76 A.L.R. 1348; Strong v. Hancock, 201 Cal. 530, 258 P. 60; Robertson v. Nichols, 92 Cal.App.2d 201, 206 P.2d 898; Forman v. Hancock, 3 Cal.App.2d 291, 39 P.2d 249.

Respondent notes that several important cases are absent from the group from which appellant has formulated the conditions listed above. It has been held in Downs v. Kroeger, 200 Cal. 743, 254 P. 1101, and in Hess v. Country Club Park, 213 Cal. 613, 2 P.2d 782, that a condition for relief is that the subject lot is now essentially business property, in a business district or on a business street, and that such lot is now no longer suitable or desirable for residential use. See, also, Alexander v. Title Ins. & Trust Co., 48 Cal.App.2d 488, 119 P.2d 992. The court will also consider the facts that the property is more valuable for business than residential use, according to the cases above as well as Marra v. Aetna Construction Co., supra. Another factor to be considered, which is present in the case now before the court is that a zoning ordinance now permits non-residential use of the lot. Jewett v. Albin, 90 Cal.App. 535, 266 P. 329; Hess v. Country Club Park, supra. Heavy traffic and traffic noises on the street where the lot is situated are also to be considered, Hurd v. Albert, Alexander v. Title Ins. & Trust Co., supra, as well as the fact that the subject lot is now near unrestricted property whether within or without the tract wherein the lot is situated.

Appellants contend that the evidence does not demonstrate that there has been a change in the neighborhood, and that all the evidence showed only a commercial use of the south side of Ocean Avenue from Paloma to Junipero Serra Boulevard with the exception of four lots. The property on the opposite side of Ocean is not commercial. It is true that the evidence shows that the restricted area of Ingleside Terraces is still a completely residential tract, with apparently non-conforming uses on but one corner, Victoria and Ocean—the dentist's office and a popcorn stand. Real estate values in the tract are still very good. Appellants maintain that the fact that Ocean Avenue west of respondent's lot has been filled in with commercial enterprises is a development exactly in accordance with the original plan of the tract since it was designated as ‘unrestricted’ therein. The street car line on Ocean Avenue was there before the tract was laid out. That there has been an increase in traffic and traffic noises since 1913 is admitted, but appellants contend that there is nothing in the record to show that such increase is not merely the normal growth in traffic, and hence no ground for avoiding the restrictions. They note that the only evidence in the record which attempts a comparison with the traffic conditions on Ocean Avenue is that given for Monterey Boulevard west of Montecito in a residential district. The percentages of increase in traffic on that street are almost the same as those for Ocean Avenue from 1937 to 1951. Respondent replies that there is no probative value in this evidence, for it well might be that the increase in traffic together with other changes in the neighborhood might entitle property owners in that area to relief from restrictions. However, it is true, as appellants contend, that there has not been a showing that the property has been rendered useless for residential purposes because of traffic conditions. However, there definitely has been a showing that it has been rendered less desirable for residential purposes.

In reply to appellant's contention that there has been no change from the original plan for the neighborhood, and therefore no change in the neighborhood, respondent points out that every case granting relief involves a change from the original plan, hence the ‘original plan’ is not a factor in such cases. What the courts look to in this state is a change in the uses to which neighboring property has been put since the imposition of the restrictions. If such change renders the restricted parcel unsuitable or undesirable for residential purposes, relief may be granted. Such a change did occur in the immediate neighborhood of respondent's lot. In 1913 when the restrictions were imposed the block was vacant and so remained until 1923 when 16 single family residences were built thereon. During all the period the use of the remainder of the block was consistent with the restrictions placed on respondent's lot. However, a change in use began taking place in 1924, until at the time of trial the block was almost entirely commercial. The cumulative nature of these changes is recognized in Hurd v. Albert, 214 Cal. 15, 26, 3 P.2d 545, 549, 76 A.L.R. 1348, where it is said that ‘The effect of each business structure located near the tract continues until finally the cumulative effect of all the business invasions on the restricted area is such that to enforce the restrictions would be inequitable and oppressive as to one party, and would not materially benefit the other.’

Appellants have cited two out of state cases, Cuneo v. Chicago Title & Trust Co., 337 Ill. 589, 169 N.E. 760, and Bickell v. Moraio, 117 Conn. 176, 167 A. 722, 724. In the first case relief was denied where the owners whose property was covered by residential restrictions sued to quiet title against them. No restrictions had been imposed on the 44 lots of the boundary streets in the subdivision, and these had been used for apartments and business building. The court there held that there has been no change from the original plan, and plaintiffs had purchased their lots with notice of that plan. Respondent notes that in the Cuneo case there were no changes in the uses to which property in the same block was being put, as is the case here. However, if the Cuneo case stands for the proposition that a change from the original plan must be shown before relief can be granted, it is not in harmony with the California authorities. The case of Bickell v. Moraio, supra, is distinguishable, since in that case there were still no business operations within the residential tract.

Appellants never refer in their brief to the fact that the block in which respondent's lot is situated was zoned for commercial purposes by the City and County of San Francisco in 1921. While such zoning does not nullify restrictive covenants in deeds, it is certainly pursuasive evidence of a change in the immediate neighborhood of respondent's lot since the restrictions were imposed in 1913.

Appellants contend that there is no showing that granting the relief herein to respondent will not be a detriment to the adjoining residential property. Hurd v. Albert, supra, holds that restrictive covenants will not be enforced if it would be oppressive and inequitable to give them effect without benefitting the party seeking to have them enforced. This implies, appellants say, the corollary that if granting relief will merely pass the burden on to the neighbor, relief must be denied. There was definite testimony by real estate experts that as to all lot owners in the tract, other than the immediately adjoining lot on Paloma, that the commercial use of the lot would have no more effect than the already existing commercial uses in that block which had been beneficial to the entire tract. There was also testimony that any intelligently developed structure would enhance the value of the adjoining lot on Paloma. It is true that appellants can point to some testimony that certain types of structures and certain possible uses, such as a gas station or a veterinarian hospital would cause some damage to the adjoining lot. Respondent notes that appellants have offered no evidence to show that retention of the restrictions would substantially or materially benefit any property owner in the tract.

Appellants contend that since the property is saleable and useable for residence purposes, relief cannot be granted merely because it is more valuable for unrestricted use. For residential use the court found the value to be between $3,000 and $4,000 while for non-residential use the value is $15,000 to $17,000, and that it is not desirable for residential use and that there is no ready market for its sale for residential purposes. They argue that the testimony shows that there has always been sales resistance to the lots on Ocean Avenue, and therefore the commercial use in the block is not the reason for sales resistance to that lot. However, there is testimony that one of the factors in sales resistance to this particular lot is the fact that the established pattern of the block is commercial.

That it is not a requirement that property be worthless for the restricted use before restrictions may be lifted is attested by the case of Marr v. Aetna Const. Co., supra, a case in which the trial court found that unrestricted the property was worth $12,000, while restricted it was worth $2,000. This is fairly comparable to the restricted and unrestricted use values as given by the real estate experts herein in regard to the subject lot.

It is emphasized by appellants that there has been no abandonment of the restrictions in the tract, and they state that in every case where relief against restrictions has been granted there has been an abandonment of the restrictions, making compliance therewith unreasonable and useless to adjoining owners. Only one non-conforming use in the tract has been established, the use of a dwelling for a doctor's office at Ocean and Victoria, about one-half a mile from respondent's lot. However, in Hess v. Country Club Park, 213 Cal. 613, 619, 2 P.2d 782, 784, relief from restrictions was granted and the trial court there found that ‘It is true that none of these buildings [referring to commercial operations] is within said tract No. 1600, and that there have been no violations of the building restrictions in said tract.’

It is urged that the trial court erred in lifting all restrictions except the set-back restriction on Paloma Avenue. The ten foot set-back restriction on the exterior southerly line was not maintained nor the two story height restriction. There is no assurance under this decree that respondent might not erect a height-limit building or a solid wall structure. It is true that in upholding a trial court's decision denying relief from restrictions, the court referred to the fact that if restrictions were lifted there was no assurance that plaintiff therein would not erect a height-limit apartment building. However, in Hess v. Country Club Park and Marra v. Aetna Const. Co., supra, decisions were affirmed where relief was given from all restrictions. The granting or withholding of equitable relief, and the degree thereof, is within the discretion of the trial court. Fairchild v. Raines, 24 Cal.2d 818, 826, 151 P.2d 260.

It is well established that the right to relief from restrictive covenants such as those herein, depends upon the facts of each case. The findings of the trial court in such a case are entitled to the same weight as in any other case, and if based on any substantial evidence, they are final. Strong v. Hancock, 201 Cal. 530, 258 P. 60; Robertson v. Nichols, 92 Cal.App.2d 201, 207, 206 P.2d 898.

A review of the record herein does not establish that the trial court abused its discretion in lifting all restrictions from respondent's property except the set-back restriction on Paloma Avenue.

The judgment of the trial court finds support in the record and no prejudicial error appearing therein, it must be affirmed.

Judgment affirmed.

I dissent. When Ingleside Terrace was laid out certain lots on Ocean Avenue which were a part of the tract itself were not restricted to residence use. The respondent's lot adjoined these but it was restricted. It was contemplated as a part of the plan of subdivision that the unrestricted lots should be used for business and that respondent's lot should not. What the scheme of subdivision contemplated has occurred exactly as planned. The lots set apart by the subdivider for business are being used for that purpose. I apprehend that this is the first case in which a court has held that the development of a subdivision exactly according to the original plan renders the restrictions on a particular lot unenforceable.

There is no such change outside the restricted tract as to make the rule of Hess v. Country Club Park, 213 Cal. 613, 2 P.2d 782, applicable. Ocean Avenue, except for the lots set aside in the subdivision plan itself for business use, has not become commercial in the neighborhood of respondent's lot. It is a bootstrap-lifting operation to say: ‘The original plan contemplated business on certain lots on Ocean Avenue. Those lots are now used for business just as planned. Therefore the character of the neighborhood has changed and the original plan can no longer be carried out.’

Some line must be drawn between residential and commercial use in any tract where both are permitted. The residential lots on the line drawn will necessarily be somewhat less valuable. That is inherent in the plan itself and cannot justify raising the restrictions unless the plan is to be destroyed.

If each lot next to a business lot is entitled to have the restrictions lifted soon there would be no restrictions left in any tract where the plan permits business use on any of the lots, because as the restriction is lifted from each lot the adjoining lot owner would in turn become entitled to have his restrictions similarly lifted. The restrictions would successively fall like a house of cards.

Respondent bought this lot with his eyes open. He wants to get a bargain at the expense of his neighbors but his neighbors built their homes in reliance on the covenant which he seeks to set aside. The equities are all with his neighbors and not with him.

KAUFMAN, Justice.

NOURSE, P. J., concurs.