Property - Real Covenants and Equitable Servitudes

Question 1

REAL COVENANTS

Answer 1

A real covenant, normally found in deeds, is a WRITTEN PROMISE to do something on the land (e.g. maintain a fence) or a promise NOT to do something on the land (e.g. conduct commercial business). Real Covenants RUN WITH THE LAND at law, which means that subsequent owners of the land may enforce or be burdened by the covenant.

To run with the land, however, the BENEFIT and BURDEN of the covenant must be analyzed separately to determine whether they meet the requirements for running

Question 2

Requirements for BURDEN to Run

REAL COVENANTS

Answer 2

Note: do BURDEN side analysis first, bc BURDEN running is harder to satisfy

“WITH Vertical Notice”

(1) WRITING - the original covenant was IN WRITING

(2) INTENT - covenanting parties must have intended that successors in interest to the covenantor be bound by the terms of the covenant.
- –This intent may be inferred from circumstances surrounding creation of the covenant, or it may be evidenced by language in the conveyance of the covenant (e.g. “this covenant runs with the land” or “grantee covenants for herself, her heirs, successors, and assigns”)

(3) NOTICE - if bona fide purchaser has no constructive or actual notice, WILL TAKE FREE of the covenant
(4) HORIZONTAL PRIVITY - rests on relationship of the ORIGINAL COVENANTING PARTIES, and requires that at the time the promisor entered into the covenant with the promise, the two shared some interest in the land independent of the covenant (e.g. grantor-grantee, landlord-tenant, mortgagor-mortgagee) - IN OTHER WORDS - the original parties must have been transferring an interest in land other than the covenant
(5) VERTICAL PRIVITY - requires a non-hostile nexus, such as contract, devise, or descent between the covenantor and the “successor-in-interest” (much easier to establish than Horizontal)

(6) TOUCH AND CONCERN - the promise must affect the parties’ legal relations as landowners and not simply as members of the public at large
(ie the burden and benefit relate to the USE of the land [not an “in gross” type benefit])

Question 3

Requirement for BENEFIT to run

REAL COVENANTS

Answer 3

WIT-V

(1) Writing
(2) Intent
(3) Touch and Concern
(4) Vertical Privity

Note: Horizontal privity not required for benefit to run, and don’t need notice

Question 4

EQUITABLE SERVITUDES

Answer 4

-if P wants injunctive relief or specific performance, he must show that the covenant qualifies as an equitable servitude. An equitable servitude is a covenant that, regardless of whether it runs with the land AT LAW, equity will enforce against the assignees of the burdened land who have NOTICE of the covenant. USUAL REMEDY is injunction against violating the covenant

Requirements for BURDEN to run: (WITNess)

(1) Writing
(2) Intent
(3) Touch and Concern
(4) Notice

Requirements for BENEFIT to run - writing, intent, touch and concern

Note: **NO PRIVITY REQUIREMENT to bind successors

Question 5

Implied Equitable Servitude

Answer 5

This is a negative equitable servitude that is implied by the general or common scheme doctrine

this doctrine will IMPLY a reciprocal negative servitude to hold the unrestricted lot holder to the restrictive covenant if 2 elements are met:

(1) when the sales began, the subdivider had a general scheme of residential development which included defendant’s lot
(2) The defendant lotholder had notice of the promise contained in the prior deeds

Question 6

Types of NOTICE

Answer 6

AIR

Actual Notice - meaning D had literal knowledge of the promises in the prior deals

Implied NOtice - meaning the neighborhood conforms to the common restriction, synonymous with the “lay of the land”

Record Notice - meaning the form of notice sometimes imputed to buyers on the basis of the publicly recorded documents

Question 7

DEFENSES to enforcement of an EQUITABLE SERVITUDE

Answer 7

(1) Changed Conditions - the changed circumstances alleged by the party seeking release from the terms of an equitable servitude must be so pervasive that the entire area has changed
-MERE POCKETS of limited change will not do
(zoning changes provide good evidence of changed conditions)

(2) Unclean Hands - person seeking enforcement is violating similar restrictions on his own land
(3) Estoppel - if benefited party has acted in such a way that a reasonable person would believe that the covenant was abandoned, and burdened party acts in reliance on this, benefited party will be estopped from enforcing the covenant
(4) Acquiescence - if benefited party acquiesces in a violation of the servitude by burdened party, may be deemed to have abandoned the servitude