A developer in Mercer County records a Declaration of Covenants, Conditions, and Restrictions (CC&Rs) against a 50-lot subdivision before selling any lots. The CC&Rs prohibit commercial use of all lots. The developer later sells Lot 1 to Buyer A without mentioning the CC&Rs in the deed. Buyer A records her deed. Three years later, Buyer A attempts to operate a home-based commercial business on Lot 1. A neighboring lot owner objects. Under New Jersey recording law, which statement best describes Buyer A's obligation?
Correct Answer
B) Buyer A is bound by the CC&Rs because the recorded Declaration provides constructive notice to all subsequent purchasers in the subdivision
Under New Jersey recording law, a Declaration of CC&Rs recorded in the county land records before any lots are sold provides constructive notice to all subsequent purchasers of lots within the subdivision. Because the Declaration was recorded before Buyer A's purchase, it appears in the chain of title and Buyer A is charged with constructive notice of its contents regardless of whether it was mentioned in her deed or whether she actually read it. She is bound by the commercial use restriction.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A freehold estate represents ownership of real property with an indefinite duration.
Joint tenancy is a form of co-ownership in which two or more persons hold equal, undivided interests in property with the right of survivorship. When one joint tenant dies, their interest automatically passes to the surviving joint tenants.
A leasehold estate grants the right to possess and use property for a defined period of time, without conferring ownership.
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