Freehold Covenants Flashcards
What is a covenant?
A promise, generally found in deeds, which must be in writing
Is a freehold covenant legal or equitable?
A freehold covenant can only ever be equitable
What is the ‘benefit’ of a covenant?
The ability to enforce the original covenant against the covenantor
What are the 2 methods of passing the benefit of a freehold covenant at common law?
- Express assignment (s136 LPA 1925)
2. Implied assignment (PA Swift Investment v Combined English Stores Group PLC)
What are the rules established in PA Swift Investment v Combined English Stores Group PLC?
1.Touch and concern land;
- Made for benefit of the land; only benefits estate owner while they own the estate
- Not expressly personal
- Affects nature, quality, use or value of the benefitted land
2. Parties intended the benefit to pass
- Parties should not have expressed the benefit to be personal to the covenantee
- Can be expressly worded
- Can be implied by s78(1) LPA 1925
- Original covenantee must have held a legal estate in the dominant land
- S1(1)LPA 1925
- No benefit can pass at law where covenantee has only equitable interest in dominant land
• Successor in title to covenantee must hold a legal estate
- Smith and Snipes v River
Other methods of passing the benefit at common law;
Contract right of third parties act 1999
Does the burden of covenant pass to a successor in title at common law? What are the authorities?
NO - Never; Austeberry v Oldham Corporation
Rhone v Stephens
Therefore the burden stays with the origninal ovenantor, but the only remedy is damages
Circumventing of the burden rule at common law
Chain of indemnities
Halsall v Brizell - Doctrine of mutual benefit and burden
What is the seminal case in the passing of a burden in a freehold covenant in equity?
Tulk v Moxhay - PUrhaser bought land in knowledge of the covenant, but ignored covenant arguing burden hadn’t passed. Equity held that where land passes in knowledge of covenant the burden passes too
What are the rules established in Tulk v Moxhay as to when a burden will pass under equity?
- The covenant must be negative
- The covenant must accomodate the dominant tenement
- The original parties must have intended the burden to run
- The person who the covenant is being enforced against must have ‘notice’ of it under the rules; actual knowledge not sufficient
What is the authority for a test of a positive or negative covenant?
Haywood v Brunswick
What are the 2 authorities for mixed covenants?
Shepherd Homes v Sandham - The covenant is split into positive and negative obligations (only negative enforced)
Powell v Hemsley - The covenant is decided to be either positive or negative, a negative covenant can carry a positive one
The covenant must accommodate the dominant tenement - Explain
The dominant holding of land must have owned the land when the covenant was made, and the succesor must hold the land when trying to enforce the covenant
What is the authority for the necessity of proximity between the lands?
Bailey v Stephens
What is the legislation which provides for the implication of intention to run?
s79 LPA 1925 - Assumption of permanance
How is notice registered?
Unregistered land; class D(ii) Land Charge Doctrine of notice applies to pre-1926 covenants Registered land; s32 notice on charges register
How does the benefit pass at equity?
Renals v Cowlishaw;
- Annexation
- Assignment
- Building schemes
What is annexation and how does it occur?
Where the benefit of covenant has become permanently attached to the land from the outset;
Express
Implied
Statute - s78 LPA 1925
Wrotham Park v Parkside Homes Ltd - Describe
Case relating to annexation. Benefit of a covenant attached to each and every part of the land
How does statutory annexation work?
s78 LPA 1925 The benefit of the covenant touches each and every part of the land. This annexation occurs automatically (Federated Homes Ltd v Mill Lodge Properties Ltd) However can be excluded Roake v Chadha
What is annexation via assignment?
Where the benefit is attached to a person so must be expressly passed on to the successor. - Miles v Easter
What are building schemes in relation to the benefit of freehold covenants?
Where individuals acquire plots on land which owned by a vendor. Each party takes their land on the understanding that the covenants benefit all the other plots - Elliston v Reacher
How can a restrictive covenant be discharged?
- Expressly via deed (usually in exchange for money)
- Impliedly - Via long usage which contravenes the covenant
- A declaration by court in accordance with s84 LPA 1925;
- Covenant obsolete due to changes in neighbourhood
- Covenant impedes reasonable user of land
- Benefited parties agreed ‘by their acts or omissions’
- Benefited parties will no be ijured by the proposed discharge or modification
