## Facts

- Ocean City, New Jersey owned numerous undeveloped, low-lying lots; the dispute concerned an eastern tract of roughly 653 lots requiring substantial fill to reach the city’s established grade.
- In 1951, Ocean City sold the tract at public sale to Stoeco Homes, Inc., the only bidder, to facilitate development.
- The deed required Stoeco to grade and fill the conveyed lots and certain lots retained by the city to the city’s established levels within one year.
- The deed included reversionary language stating that failure to meet the filling and grading requirements could cause title to revert to the city.
- The deed also reserved to Ocean City the right to “change or modify any restriction, condition or other requirement” contained in the deed.
- Stoeco did not complete a substantial portion of the required filling within the one-year period.
- Instead of declaring a forfeiture, Ocean City adopted a series of resolutions extending the time for performance on various lots, ultimately extending deadlines into the late 1950s and 1960.
- Ocean City residents and taxpayers, including Winifred C. Oldfield and her husband, sued in lieu of prerogative writ to invalidate the extension resolutions and compel forfeiture and reversion of the land to the city.
- The trial court entered judgment for defendants; the New Jersey Supreme Court took the appeal by certification before Appellate Division hearing.

## Issues

1. Whether the deed created a fee simple determinable with automatic reversion upon failure to complete filling within one year, or a fee simple subject to a condition subsequent requiring the city to elect forfeiture.
2. Whether Ocean City, under the deed’s reserved power to modify conditions, could lawfully extend the time for performance by resolution.
3. Whether taxpayers could compel forfeiture and reversion when the city elected to extend performance rather than terminate the grantee’s estate.

## Decision

- The New Jersey Supreme Court affirmed the judgment for defendants.
- The Court held the deed created a fee simple subject to a condition subsequent, not a fee simple determinable.
- Title did not automatically revert to Ocean City upon missed deadlines.
- Ocean City validly exercised its expressly reserved authority to modify deed conditions by extending the time for performance.
- Because no automatic reversion occurred and the extensions were authorized, the taxpayers were not entitled to judicially compelled forfeiture.

## Legal Principles

- The classification of a defeasible fee depends on the intent shown by the deed read as a whole, not on isolated phrases suggesting duration or reversion.
- A grantor’s express reservation of power to change or modify restrictions and conditions is strong evidence of a condition subsequent (grantor discretion to enforce or relax), rather than a determinable fee (automatic termination).
- Where an estate is subject to a condition subsequent, breach does not end title automatically; the grantor must elect termination consistent with the instrument’s terms.
- Courts will avoid construing instruments to require forfeiture when the deed’s structure and the parties’ apparent objective support a construction allowing continued performance.

## Conclusion

The court held that the municipal deed conveyed a fee simple subject to a condition subsequent and, because the city retained and exercised a contractual power to modify conditions, the city’s extensions were valid and no automatic reversion or taxpayer-compelled forfeiture was warranted.


Oldfield v. Stoeco Homes, Inc., 26 N.J. 246, 139 A.2d 291 (N.J. 1958)