Opinion
No. 4513.
Argued April 2, 1957.
Decided May 23, 1957.
1. The holding in Pratte v. Balatsos, 99 N.H. 430, that a certain written agreement between a music company and a proprietor of a luncheonette relating to the installation of record-playing equipment in the latter's place of business reciting that it should be binding upon the heirs, successors and assigns of the parties created an equitable servitude upon the leasehold binding upon the defendant successor in interest to the luncheonette business, provided the defendant had notice thereof, was reaffirmed.
2. The finding was justified on the evidence that defendant's knowledge of such agreement was sufficient to put him on inquiry as to its terms and that inquiry would have disclosed the terms.
BILL IN EQUITY, for a decree permanently restraining the defendant from breaching an agreement between the, plaintiff and the defendant's predecessor. A temporary injunction was issued but after hearing on the merits the Court ruled that the defendant was not bound by the agreement and dismissed the petition. The case was transferred to the Supreme Court which remanded it for additional findings. Pratte v. Balatsos, 99 N.H. 430. Upon further hearing, the Superior Court issued an amended decree revoking the previous one and permanently enjoined the defendant from breaking the agreement. The defendant excepted to the Court's failure to grant certain findings of fact and rulings of law and to the Court's rulings of law and fact as made.
It appears that the plaintiff and one Larochelle, former proprietor of the business now conducted by the defendant in Manchester, made an agreement which related to the use and operation of the plaintiff's record player and equipment on Larochelle's premises. The agreement in substance was that this juke box should be operated during the term of the contract which was fourteen years and six months and that "no similar equipment nor any other kind of coin-operated machine will be installed or operated on said premises by anyone else." This agreement was to be binding on the "heirs, successors and assigns" of the parties. The Court has found and ruled that the defendant when he purchased the property had knowledge of this agreement sufficient to put him on inquiry as to its terms and that inquiry would have disclosed the terms. Other facts appear in the opinion. Reserved and transferred by Grant, J.
Ernest R. D'Amours (by brief and orally), for the plaintiff.
Wyman, Starr, Booth, Wadleigh Langdell and Stanton E. Tefft (Mr. Tefft orally), for the defendant.
The defendant urges in effect that we overrule our previous opinion (Pratte v. Balatsos, 99 N.H. 430), and in so doing he relies mainly on an article on "Equitable Servitudes and Chattels" by Zechariah Chafee, Jr., 69 Harv. L. Rev. 1250, discussing the Pratte case. Re-examination of the decision in the light of the article convinces us there is no reason to do so. In an earlier article by the same author on the same subject, he said: "On general principles equitable servitudes on chattels seem a reasonable and flexible device, which the courts might use when desirable." 41 Harv. L. Rev. 945, 1007. Again, he asserted that the doctrine of equitable servitudes on chattels "is a legitimate tool in the judicial equipment, ready for use when desirable." Id., 987. Nowhere in his later article which the defendant cites does he disavow these statements. Even there, in regard to the Pratte case, he expressly states: "My criticism is not based on the outcome." 69 Harv. L. Rev. supra, 1262. With reference to the wisdom of the policy established by that decision, he contents himself with observing, "I am not saying whether the right answer is `Yes' or No, but only venture to regret that the New Hampshire opinion never asked this question at all." Id., 1258. In conclusion, he concedes that the arguments which he has marshaled against the enforcement of an equitable servitude in this case "may not be sufficient to override the sacredness of contracts." Id., 1264. In short, the authority upon which the defendant places chief reliance seems to us to support in principle the doctrine of equitable servitude applied in the Pratte case and to express merely a regret that our opinion did not discuss more fully the policy factors involved. Id., 1258.
The issues presented by the exceptions relate to the finding of the Trial Court following the decision of this court and the denial of certain of the defendant's requests. The record fully supports the Court's finding that the defendant's knowledge was sufficient to put him on inquiry as to the terms of the agreement and that inquiry would have disclosed the terms. Accordingly the defendant takes nothing by these exceptions.
His final argument that the burden created was "in the nature of a lease" and therefore should have been recorded under RSA 477:7 does not now require extended consideration. This issue was decided adversely to the defendant on the previous transfer. Pratte v. Balatsos, 99 N.H. 430, 432, 433. An examination of the record disclosing no further exception of merit, the order is
Decree affirmed.
WHEELER, J., took no part in the decision; KENISON, C. J., concurred specially; the others concurred.
I did not agree with the decision in Pratte v. Balatsos, 99 N.H. 430, 436, the baleful implications of which were to me convincingly explored by an authority in equity. Chafee, "The Music Goes Round and Round: Equitable Servitudes and Chattels," 69 Harv. L. Rev. 1250 (1956). However, that decision is now reaffirmed as the law of this state and compels my concurrence in this case solely for that reason.