Freehold restrictive covenants

Question 1

What is a freehold covenant?

Answer 1

• A promise or agreement between freeholders which stipulates the way a property can/cannot be used
• Can only exist at equity BUT is enforceable at law and equity

Question 2

Covenantor

Answer 2

Makes the promise and takes the burden

Question 3

Covenantee

Answer 3

Takes the benefit

Question 4

What form can they take?

Answer 4

Positive or restrictive

Question 5

Contractual model

Answer 5

Giving a remedy in Law

Question 6

Proprietary model

Answer 6

Giving a remedy in equity, greater flexibility but discretionary

Question 7

Enforceability of covenants as contracts:

Answer 7

Enforceable between the original parties

Question 8

Enforceability of covenants as proprietary interests

Answer 8

• Equitable interest
• Benefit and burden may run with land
• Benefit and burden must run together

Question 9

Enforceability of original covenants at law

Answer 9

• Doctrine of privity of contract applies

- Both positive and negative covenants are enforceable

Question 10

Extending covenantees (benefit)

Answer 10

• s56 Law of Property Act

- Contracts (Rights of Third Parties) 1999 s1(a) or s1(b)

Question 11

Passing of benefit at Law

Answer 11

1. ) Must touch and concern the land - Swift Investments
2. ) Original covenantee must have a legal estate
3. ) Successor in title to covenantee must have a legal estate in benefitted land
4. ) Benefit must have been intended to run - S78 LPA 1925

Question 12

Running of burden at Law

Answer 12

• Will not run (DIFFERENT TO LEASES)
• Covenantor remains liable:
• Austerbery v Oldman Corp
• Rhone v Stephens

Question 13

Austerberry v Oldham Corp

Answer 13

• Burden cannot run at common law

Question 14

Rhone v Stephens

Answer 14

• Confirmed no running of burden at Law

Question 15

Running of burden at Law - avoiding Austerberry

Answer 15

• Chain of indemnity covenants
• Purchaser covenanting directly with person taking the benefit
• Long lease
• Rule in Halsall v Brizell

Question 16

Halsall v Brizell

Answer 16

• Mutally benefit and burden ( MUST BOTH BENEFIT AND BURDEN)
• If benefit is taken from covenant, the burden must be taken as well
• The benefit and burden do have to be related in some way for rule to apply

Question 17

Freehold covenants in unregistered/registered

Answer 17

Cannot be legal interests

Unregistered:
Pre-1926: Doctrine of Notice
Post-1926: Class D(ii) Land Charge

Registered Land:
Notice on Charges Register of title

Question 18

Passing of benefit at equity:

Answer 18

1. ) Must touch and concern the land
2. ) Successor in title to covenantee must have legal or equitable estate in benefitted land
3. ) Benefit must have passed through either:
   - Annexation
   - Assignment
   - Building scheme

Question 19

Annexation: Express

Answer 19

Lamb v Midas Equipment

“to his heirs, executors, administrators, transferees and assigns” - express

Question 20

Annexation: Implied

Answer 20

Sainsbury v Enfield

Question 21

What is annexation?

Answer 21

Basically being sold

Question 22

Annexation: Statutory

Answer 22

-s78 LPA 1925

Question 23

Federated Homes v Mill Lodge Properties

Answer 23

• Where it is clear which Land was intended to benefit, the covenant was annexed to that land by and no
• Helping to interpret s78(1)

Question 24

Exceptions to Federates Homes:

Answer 24

Roake v Chahha:
-If a contrary exception is expressed

Crest Nicholson v McAllister:
- Lands need to be easily identifiable

Question 25

Assignment:

Answer 25

Involves the conferring of a benefit on a person:

1. ) Assignment must be at the same time as the transfer of the land to be protected
2. ) Covenant must be for benefit of land owned by original covenantee at time of covenant
3. ) Dominant land must be ascertainable or certain

Question 26

Building scheme:

Answer 26

Elliston v Reacher:

1. ) Both claimant and defendant derived title from common owner
2. ) Common owner had laid out a definite scheme of development
3. ) Intention to impose a scheme of mutally enforceable covenants on the purchasers and successors
4. ) Every purchaser bought the land knowing of the scheme intending to be bound

Reid v Bickerstaff - 5.) Area to which the scheme extends is clearly defined

Question 27

Passing of burden at equity:

Answer 27

Tulk v Moxhay:

1. ) Covenant must be restrictive/negative
2. ) It must touch and concern the land (Swift)
3. ) At the date of the covenant, the covenantee must have owned the land benefitted
4. ) The burden must have been intended to run with the land of the covenantor (Can be implied by s78 LPA)

Question 28

Re Ecclesiastical

Answer 28

Held that effect of s56 is that a third party is to be held as if an original covenantee

Question 29

Amsprop Trading v Harris Distribution

Answer 29

Held s56 only affected where covenantee was involved BUT doesn’t depart from Re Ecclesiastical