L5 - Covenants (cases) Flashcards
Tulk v Moxhay (1848) (HL)
Main point: possible to enforce (restrictive) covenant against successor of the covenantor where he has notice (or modern equivalent) of it
Summary: original covenantor (Co) covenanted w/ O of adjacent property (Ce) that square in central London would be maintained an ornamental open space ; square was sold to purchaser (P) who wanted to build on it (relying on CL rule that burden doesn’t run)
=> HL held that Ce had an equity to enforce the covenant against P, bcs he had known of the restriction when acquiring his estate – attached a lot of importance to the inequity of P acquiring w/ notice of restriction, but simply disregarding it
Rhone v Stephens (1994) (HL) (main points)
reaffirmed that burden of covenant does not run at CL, and that equity might enforce burden of a restrictive covenant against successor to Co, but not of a positive covenant
+ doctrine of benefit & burden: only applies where burden of a right is clearly attached to a specific benefit – no general principle that party taking the benefit of a conveyance must also take the burden
=> to be enforceable under Halsall v Brizell, burden must be relevant to the exercise of a right = attached to a benefit
Rhone v Stephens (1994) (HL) (summary)
House divided into 2 separate dwellings (house & cottage), pt of roof of house lay above bedroom of cottage – O kept house and sold cottage, covenanting for himself & successors to maintain roof of the house in good condition – 25y later, roof in bad condition and water leaking into bedroom => successor of Ce sought to enforce ag successor of Co
HL held in favour of successor of CO : such a positive covenant was not enforceable ag him
=> burden of negative covenants could run in equity, but no general principle requiring a party deriving benefit from a conveyance to accept any burden in the same conveyance
=> to be enforceable under Halsall v Brizell, burden must be relevant to the exercise of a right = attached to a benefit
Re Nisbet & Pott’s Contract (1906) (CA)
Main point = squatter acquiring title by AP takes subject to (negative) covenants binding dispossessed owner, and so do all those deriving title under him except BFPFVWN
Summary: N held land from someone who acquired title by AP (several conveyances since), contracted to sell it to P. Prior to conveyance, P informed of restrictive covenant (granted before extinction of PO’s title) of which neighbour had benefit P sought to rescind contract bcs covenant binding on the land
CA held in favour of P : the covenant was binding on the land
* Ce’s right (covenant) not extinguished at same time as PO’s (time not running ag Ce unless and until his right is infringed = it becomes necessary to enforce it)
* No reason why Sq should take free of the burden, not be able to pass land free of it – except to equity’s darling bcs burden of restrictive covenant = an equitable right
* N had not investigated title for the full 40y so fixed w/ constructive notice of it, and now P knew so would be binding on him
LCC v Allen (1914) (CA) (main point)
where covenant runs w/ the benefited land, covenantee who no longer has title to benefited land can no longer sue on the covenant
Thamsmead Town Ltd v Allotey (1998)
Main point : 2 requirements for PFC to be made binding ag S
(1) the burden must be relevant to the exercise of the rights which enable a benefit to be obtained
(2) S must be given the opportunity* to give up the benefit, and thereby to escape the burden
Summary: Co covenanted to pay svc charge for maintenance of roads, sewers & landscaped / communal areas
=> CA held S lb to pay for roads & sewers which he used but not areas from which he allegedly derived no benefit
/!\ “it is not possible to enforce every burden in a conveyance by depriving the covenantor’s successors in title of every benefit which he enjoyed under the conveyance. There must be a correlation between the burden and the benefit which the successor has chosen to take”
Federated Homes v Mill Lodge Properties (1980) (CA)
Main point : new construction of s78 LPA 1925 = provided that a covenant relates to (as in ‘touches and concerns’) Ce’s land, the benefit of that covenant runs with the land and is annexed to it
Summary: M sold blue land to D, who covenanted not to build more than 300 houses on it, covenant expressed to be for the benefit of ‘any adjoining property retained by M Ltd’ – M Ltd then sold red and green land, eventually came to the hands of P, all conevyances of green land contained assignment of benefit of D’s covenant, but last conveyance of red land didn’t – D breached covenant, P sought to enforce it
CA held in favour of P: both lands benefited from the covenants (green land through express assignment and red land by annexation under s78 LPA 1925) => On true construction of s78 LPA 1925: provided that a covenant relates to (as in ‘touches and concerns’) Ce’s land, the benefit of that covenant runs with the land and is annexed to it
Crest Nicholson v McAllister (2004) (main point)
Main point: for s78 to annex the benefit, land to be benefited must be sufficiently identified in the conveyance + also operation of s78 can be rebutted by evidence of contrary intention
Re Union of London & Smith’s Conveyance (1993) (CA) (main point)
Main point (A textbook) : benefit of covenant should be transferred to purchaser at time of conveyance, assignment made after estate has been transferred is not acceptable
Romer LJ : Express assignee of benefit is entitled to enforce it where:
(1) the land (of assignee) is land capable of being benefited by the covenant
(2) the land (of assignee) is ascertainable
(3) the covenant cannot be enforced by the covenantee against an assign of the purchaser after the covenantee has parted with the whole of his land*
*bcs no privity w/ successor of covenantor + if has parted w/ benefited land, covenantee can no longer enforce the covenant => can’t assign a right he no longer has
Elliston v Reacher (2008)
Main point = sets out 4 rules to establish a building scheme:
(1) Purchasers derive title from a common vendor
(2) Before selling, V divided the land into plots / created some sort of scheme
(3) Same restrictions are imposed on all the plots + clear that restrictions are to benefit the plot sold
(4) P of each plot acquires on the understanding that the covenants are intended to benefit all other plots in the scheme (rather than V)
Summary: BS divided area into plots and sold them w/ identical conveyances imposing identical covenants on each purchaser
=> court held that covenants were enforceable against all successors to the original covenantor + set out 4 sules to establish a building scheme (above)
Re Dolphin’s Conveyance (1970) (main point)
4 rules in Elliston v Reacher are guidance, not strict requirements
=> if there is a common intention that covenants be enforceable by neighbours ag each other and common interest in their enforcement, the court will give effect to it under building scheme
Smith & Snipes Hall Farm v River Douglas Catchment Board (1949) (CA)
Main point: sets out requirements for benefit of covenant to be annexed to land by operation of s78 LPA 1925 + established that possible for leaseholder to enforce covenant established by freeholder
Summary: D Board covenanted w/ Ce that it would maintain the banks of a river next to Ce’s land. Ce sold the land to C1 = Smith, who leased it to C2 = farming company – the river flooded bcs banks not maintained, Cs wanted to recover losses from D bcs breach of covenant
CA held in favour of Cs: the beenfit of the covenant was annexed to the land by the operation of s78 LPA 1925, and could be enforced by C2 (derived title under C1’s title)
Smith & Snipes Hall Farm v River Douglas Catchment Board (1949) (CA) - 4 requirements for benefit to run with the land
(i) Covenant’ touches and concerns’ the land of the Ce
(ii) At time covenant was made, parties intended benefit to run w/ the land to Ce’s successors
(iii) At time covenant was made, Ce held legal estate in land to be benefited
(iv) Claimant derives his title from/under the original Ce
Beswick v Beswick (1968) (HL)
Summary: Uncle (U) ag w/ nephew (N) that he would transfer coal business to him in consideration of his employing him as a consultant for ag salary for the rest of his life + pay £5/w to his wife (W) after his death – after U’s death, N paid once then refused to continue – W sued as administratrix and in personal capacity
HL : widow was entitled to order for specific performance as administratrix (rather than mere nominal damages for loss to the estate) but not entitled to enforce the obligation in her personal capacity (bcs not a party to its creation and s56 LPA 1925 didn’t eliminate privity)
