Freehold Covenants

Question 1

What is a covenant?

Answer 1

A promise, generally found in deeds, which must be in writing

Question 2

Is a freehold covenant legal or equitable?

Answer 2

A freehold covenant can only ever be equitable

Question 3

What is the ‘benefit’ of a covenant?

Answer 3

The ability to enforce the original covenant against the covenantor

Question 4

What are the 2 methods of passing the benefit of a freehold covenant at common law?

Answer 4

1. Express assignment (s136 LPA 1925)

2. Implied assignment (PA Swift Investment v Combined English Stores Group PLC)

Question 5

What are the rules established in PA Swift Investment v Combined English Stores Group PLC?

Answer 5

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

Question 6

Other methods of passing the benefit at common law;

Answer 6

Contract right of third parties act 1999

Question 7

Does the burden of covenant pass to a successor in title at common law? What are the authorities?

Answer 7

NO - Never; Austeberry v Oldham Corporation
Rhone v Stephens
Therefore the burden stays with the origninal ovenantor, but the only remedy is damages

Question 8

Circumventing of the burden rule at common law

Answer 8

Chain of indemnities

Halsall v Brizell - Doctrine of mutual benefit and burden

Question 9

What is the seminal case in the passing of a burden in a freehold covenant in equity?

Answer 9

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

Question 10

What are the rules established in Tulk v Moxhay as to when a burden will pass under equity?

Answer 10

1. The covenant must be negative
2. The covenant must accomodate the dominant tenement
3. The original parties must have intended the burden to run
4. The person who the covenant is being enforced against must have ‘notice’ of it under the rules; actual knowledge not sufficient

Question 11

What is the authority for a test of a positive or negative covenant?

Answer 11

Haywood v Brunswick

Question 12

What are the 2 authorities for mixed covenants?

Answer 12

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

Question 13

The covenant must accommodate the dominant tenement - Explain

Answer 13

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

Question 14

What is the authority for the necessity of proximity between the lands?

Answer 14

Bailey v Stephens

Question 15

What is the legislation which provides for the implication of intention to run?

Answer 15

s79 LPA 1925 - Assumption of permanance

Question 16

How is notice registered?

Answer 16

Unregistered land;
class D(ii) Land Charge
Doctrine of notice applies to pre-1926 covenants
Registered land;
s32 notice on charges register

Question 17

How does the benefit pass at equity?

Answer 17

Renals v Cowlishaw;

1. Annexation
2. Assignment
3. Building schemes

Question 18

What is annexation and how does it occur?

Answer 18

Where the benefit of covenant has become permanently attached to the land from the outset;
Express
Implied
Statute - s78 LPA 1925

Question 19

Wrotham Park v Parkside Homes Ltd - Describe

Answer 19

Case relating to annexation. Benefit of a covenant attached to each and every part of the land

Question 20

How does statutory annexation work?

Answer 20

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

Question 21

What is annexation via assignment?

Answer 21

Where the benefit is attached to a person so must be expressly passed on to the successor. - Miles v Easter

Question 22

What are building schemes in relation to the benefit of freehold covenants?

Answer 22

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

Question 23

How can a restrictive covenant be discharged?

Answer 23

1. Expressly via deed (usually in exchange for money)
2. Impliedly - Via long usage which contravenes the covenant
3. 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