EXHIBIT 5.1
OPINION OF LATHAM WATKINS
[LETTERHEAD]
October 27,1998
Realty Income Corporation
220 West Crest Street
Escondido, California 92025
Re: Registration Statement No. 333-34311; up to $115,000,000
AGGREGATE PRINCIPAL AMOUNT OF 8 1/4% MONTHLY INCOME SENIOR
NOTES DUE 2008
Ladies and Gentlemen:
We have acted as special counsel to you in connection with the
issuance of up to $115,000,000 aggregate principal amount of 8 1/4% Monthly
Income Senior Notes due 2008 (the "Securities"), pursuant to a registration
statement on Form S-3 under the Securities Act of 1933, as amended (the "1933
Act"), filed with the Securities and Exchange Commission (the "Commission")
on August 25, 1997 (File No. 333-34311), as amended by Amendment No. 1 filed
with the Commission on September 16, 1997 (as so amended, the "Registration
Statement") and a prospectus supplement dated October 23, 1998 and a related
prospectus dated October 1, 1997 (collectively the "Prospectus"). Except as
otherwise expressly indicated, the terms Registration Statement and
Prospectus shall include all documents incorporated by reference therein.
As such counsel, we have made such legal and factual examinations
and inquiries as we have deemed necessary or appropriate for purposes of this
opinion. In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals,
and the conformity to authentic original documents of all documents submitted
to us as copies. As to facts material to the opinions, statements and
assumptions expressed herein, we have, with your consent, relied upon oral or
written statements and representations of officers and other representatives
of the Company and others. In addition, we have obtained and relied upon
such certificates and assurances from public officials as we have deemed
necessary.
We are opining herein as to the effect on the subject transaction
only of the internal laws of the State of New York, and we express no opinion
with respect to the applicability thereto, or the effect thereon, of the laws
of any other jurisdiction
or as to any matters of municipal law or the laws of any local agencies
within any state. Various issues concerning Maryland law are addressed in
the opinion of Ballard Spahr Andrews & Ingersoll, LLP, which has been
separately provided to you, and we express no opinion with respect to those
matters.
Capitalized terms used herein without definition have the meanings
assigned to them in the Purchase Agreement.
Subject to the foregoing and the other matters set forth herein, it
is our opinion that, as of the date hereof:
1. Assuming the due authorization, execution and delivery of the
Indenture by the Company under the laws of the State of Maryland and the due
authorization, execution and delivery of the Indenture by the Trustee, the
Indenture constitutes a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms.
2. Assuming the due authorization and execution of the Securities
by the Company under the laws of the State of Maryland, the Securities, when
authenticated by the Trustee in the manner provided in the Indenture
(assuming the due authorization, execution and delivery of the Indenture by
the Trustee) and delivered against payment of the purchase price therefor
specified in the Purchase Agreement, the Securities will constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms.
The opinions rendered in the foregoing paragraphs relating to the
enforceability of the Indenture and the Securities, respectively, are subject
to the following exceptions, limitations and qualifications: (i) the effect
of bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to or affecting the rights and remedies
of creditors; (ii) the effect of general principles of equity, whether
enforcement is considered in a proceeding in equity or law, and the
discretion of the court before which any proceeding therefor may be brought;
(iii) the unenforceability under certain circumstances under law or court
decisions of provisions providing for the indemnification of or contribution
to a party with respect to a liability where such indemnification or
contribution is contrary to public policy; (iv) we express no opinion
concerning the enforceability of the waiver of rights or defenses contained
in Section 514 of the Indenture; and (v) we express no opinion with respect
to whether acceleration of the Securities may affect the collectibilityof
that portion of the stated principal amount thereof which might be determined
to constitute unearned interest thereon.
To the extent that the obligations of the Company under the Indenture
may be dependent upon such matters, we assume for purposes of this opinion
that the Trustee under the Indenture is duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization; that the
Trustee has complied with any applicable requirement to file returns and pay
taxes under the Franchise Tax Law of the State of California; that the
Trustee is duly qualified to engage in the activities contemplated by the
Indenture; that the Indenture has been duly authorized, executed and
delivered by the Trustee and constitutes a legally valid, binding and
enforceable obligation of the Trustee enforceable against the Trustee in
accordance with its terms; and the Trustee is in compliance, generally and
with respect to acting as trustee under the Indenture, with all applicable
laws and regulations; and that the Trustee has the requisite organizational
and legal power and authority to perform its obligations under the Indenture.
We consent to your filing this opinion as an exhibit to a current report on
Form 8-K and to the reference to our firm in the prospectus supplement dated
October 23, 1998 contained under the heading "Legal Matters."
Very truly yours,
/s/ LATHAM & WATKINS