Cowan v. Carnavale
In Cowan v. Carnavale (N.Y.App.Div. 2002) 300 A.D.2d 893, 752 N.Y.S.2d 737, at the time of the claimed extinguishment by merger in 1988, a husband and wife owned the servient tenement as tenants in common with a third person.
In that year, husband and wife also acquired title to the dominant tenement as tenants by the entirety, 9 and gave the wife's father a purchase money mortgage because he provided funds for the transaction. After the husband and wife defaulted on the loan, the father foreclosed and became the owner of the dominant estate. The father then sued to establish his right to use the easement.
The court rejected the defendants' contention that the easement had been extinguished in 1988. Its reason for finding no merger was not that title to the dominant and servient tenements was held by a group of persons as tenants in common or tenants by the entirety, but rather that the same group of persons did not own all of the interests in the dominant and servient tenements: Although the husband and wife acquired title in fee simple to the entire dominant tenement, the husband and wife together owned only a fractional share of the servient property, not the entire estate. In this factual context the court stated:
"When both the dominant and servient estates are entirely owned by the same person, the easement is extinguished by the doctrine of merger . Simply, under those circumstances, the easement serves no purpose because the owner may use either estate freely . Significantly, however, 'merger is not effective, and an easement is not extinguished as a result of the merger, if the person owning both the dominant and servient estates only holds title to the servient tenement as tenant in common with another. He must own the entire title to both lots in fee if the easement is to terminate by merger. ...' " (Cowan, 752 N.Y.S.2d at pp. 739-740.)
The Cowan court recognized that extinguishment by merger could apply when the same two people own the entirety of the dominant and servient tenements, because it went on to state that in 1993, when the third person conveyed all his interest in the servient estate to the husband and wife, they "did acquire the requisite unity of title" for extinguishment by merger, but that the easement nonetheless was not extinguished because of an exception that protects the interests of a mortgagee. (Ibid.) This exception precludes merger to protect the interest of a mortgagee of the dominant estate in preserving an easement "otherwise extinguished when fee title to the dominant estate and fee title to the servient estate have been united in one fee owner." (Ibid.)