FU Cottage One Case Study – Description
In June 2018, Sam purchased Summer Acres, a large parcel of land in upstate New York. Summer Acres, the former site of a summer resort, contained 100 abandoned cottages and a hotel that Sam planned to renovate and sell. In the summer of 1999, Sam told Pete that, because of their past friendship, Pete could have Cottage One, the largest cottage on the property. No deed was ever delivered to Pete. Pete has occupied Cottage One each July from 1999 until the present. Due to financial difficulties, Sam was not able to renovate the cottages and hotel and, in 2000, sold Summer Acres to Dave, a real estate developer. The description in the deed to Dave included the property on which Cottage One was located.
Since 1999, Pete has maintained fire insurance and telephone and electric service for Cottage One and has claimed Cottage One as his voting residence. Pete has also posted no trespassing signs around Cottage One placed bars and locks on the doors and windows and actively repelled trespassers. Pete claims
that he holds title to Cottage One.
In 2005, a fire severely damaged the hotel. Acting under a county ordinance, the county obtained a court order compelling Dave to remove the hotel as a dangerous public nuisance.
When Dave failed to demolish the hotel within the required time, the county entered into a demolition contract with Wreckco, a demolition contractor. The contract called for Wreckco to demolish the hotel and, after demolition, to remove all walls and foundations.
In January 2008, Dave began construction of a new building on the site of the old hotel. When construction began, Dave discovered that the foundations had not been removed as required by the contract between the county and Wreckco, substantially increasing Dave’s cost for construction of the new building. After renovating another cottage on Summer Acres, Cottage Two, Dave entered into a one year written lease with Tim for rental of Cottage Two at $1,000 per month, commencing January 1, 2010 and expiring December 31, 2010.
After the expiration of the lease, Tim continued to occupy Cottage Two. On January 10, 2011, Dave accepted $1,000 rent from Tim for the month of January. On January 15, Dave served Tim with a notice to vacate Cottage Two as of February 28, 2011. Tim claims that Dave’s acceptance of the rent for January renewed the ease for another year.
(1) Does Pete hold title to Cottage One?
(2) Is Dave entitled to maintain an action against Wreckco for breach of
contract for its improper performance of the contract?
(3) What rights of possession, if
any, does Tim have in Cottage Two?
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