In 1951, Orchard Hill Realties conveyed a property to the Baums.
Contained a provision that said that Orchard Hill would provide water for domestic use to the Baums for $35/year from May to October.
Covenant said to run with the land and bind the heirs and assigns of both parties.
Eagle Enterprises succeeded Orchard Hill Realties, and Gross succeeds the Baums.
Gross refused to accept and pay for water because he has constructed his own well and now lives there year round.
Procedural History
Lower court found that the covenant was binding.
Appellate Division Reversed.
Issues
Is the promise of the original grantees to accept an pay for a seasonal water supply enforceable against subsequent grantees?
Holding/Rule
The promise of the original grantees to accept an pay for a seasonal water supply is not enforceable against subsequent grantees
Reasoning
Must meet requirements of intent, privity, and touch and concern.
This does not meet touch and concern requirement.
Distinction between covenants that run with the land and those that are personal depends on the effect of the covenant on the legal rights which otherwise would flow from the ownership of the land and which are connected in the land.
Does the covenant in purpose and effect substantially alter those rights?
This covenant does not substantially affect the ownership interests of the landowners here.
No evidence that land would have no water without the agreement.
Obligation to receive water from Eagle Enterprises resembles a personal, contractual promise to purchase water rather than a significant interest attaching to respondent's property.
