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Valleybrook Country Club, LLC v. Gloucester Township Council

A-1516-09T3 (N.J. Super. App. Div. 2010) (Unpublished)

DEEDS; RESTRICTIONS — Encroachment by a prohibited residential use on a small portion of deed-restricted land, absent other evidence, cannot be construed as an abandonment of the deed restriction, especially where, as a practical matter, the encroachment does not interfere with the intended use of the restricted land.

A developer purchased a 27-hole golf course. Its predecessors in title had obtained approvals from a municipal planning board for a residential development of approximately 255 acres. The predecessors suggested a development that would permanently preserve an eighteen hole golf course on the land. The predecessors executed and recorded a deed to themselves, using a metes and bounds description of the golf course and restricting the described property to permitted accessory and incidental uses such as a clubhouse, with or without eating facilities, maintenance buildings, and a pro shop. The planning board agreed to a provision in the deed permitting, if necessary, future adjustment of the boundary lines of the restricted golf course property. A public offering statement for the sale of residential townhomes on the property expressly notified potential buyers that the golf course would be permanently preserved.

The developer sought a declaratory judgment that a deed restriction did not apply to its golf course property, and that it was not prohibited from building more residential units on approximately five acres within the golf course property that were currently used as a driving range. The complaint alleged that the deed restriction did not apply to the driving range, and that it was unenforceable because it did not precisely describe the boundaries of the restricted golf course property. A survey demonstrated that 24 of 1,076 completed residential units encroached upon the reserved golf course property. The complaint also included a claim that the deed restriction had been abandoned because of the residential use within the boundaries and because the property allegedly had been used for improper purposes over the years – i.e., as a driving range and a restaurant and bar. The lower court dismissed the complaint, either by motion or at trial. The developer appealed the disposition of its entire complaint.

On appeal, the Appellate Division affirmed, finding that setting aside the deed restriction as “vague,” based on language that permitted future adjustment of boundary lines was not implicated, because the cause of action pertained to a proposed use on the driving range which was located entirely within the interior of the property, well away from boundary lines. Further, the deed contained precise metes and bounds, and unequivocally stated that the property had to be used for a golf course and its accessory and incidental uses.

The Court also found that the driving range was an accessory, or incidental, use related to the principal golf course use. Conversely, residential development was not, and therefore was not a permitted use within the property. The Court also held that the deed restriction had not been abandoned by the construction of 24 out of 1,076 townhomes on the golf course and because such construction was not intended as an abandonment of the deed restriction and, as a practical matter, did not interfere with use of the golf course. Lastly, the bar and restaurant qualified as an eating facility, and this was a permitted use under the deed restriction; therefore its existence did not result in any abandonment.

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