Genovese Drug Stores, Inc. v. Connecticut Packing Company, Inc.
United States Court of Appeals for the Second Circuit
732 F.2d 286 (1984)
Genovese (plaintiff) leased shopping-center space from Bercrose (defendant), whose lease included a restrictive covenant barring leases to film-development retailers like Fotomat (defendant), with a separate Consent and Agreement extending the same restriction to adjacent land owned by Bercrose's affiliated entity, Copaco (defendant); Genovese recorded only a Memorandum of Lease naming Bercrose as lessor, never recording the Consent and Agreement or referencing the Copaco restriction. Years later, Copaco leased parking-lot space to Fotomat without disclosing the restrictive covenant, and when Genovese sued to enforce it against Fotomat's kiosk, the trial court found Fotomat had constructive notice and granted a preliminary injunction; Fotomat appealed.
Whether a purchaser or lessee of property has constructive notice only of those encumbrances that appear in his direct chain of title.