Real Covenants

Question 1

What is a Real Covenant?

Answer 1

A promise concerning g the use of the land that runs to successors to the promise

When an agreement binds a successor, it “runs with the land”

Question 2

Benefit

Answer 2

The benefit of the covenant is the ability to enforce the covenant

Question 3

Burden

Answer 3

The burden of the covenant is being subject to it (ie, bound by it)

Question 4

Requirements to Run

Answer 4

1) Writing
- A real covenant is subject to the SOF, so it must be in writing

2) Intent
- To bind a successor, the original parties must intend for the covenant to run with the land

3) Touch and concern
- A real covenant must touch and concern the land
- The benefit or burden of the covenant must affect both partiers as owners of the land

4) Notice
- Either actual notice or constructive (record) notice is required to run a real covenant
- Inquiry notice may also suffice for an equitable servitude

5) Privity
- Horizontal Privity: To run the burden to a successor, the original parties to the promise must have been in horizontal privity - this refers to privity of estate, where the estate and covenant are contained in the same instrument (eg, the deed).
- Vertical Privity: Refers to the relationship between the original party to the agreement and his/her successor to the property. To run the burden of the covenant to the successor, the successor must take the original party’s entire interest. This is called STRICT vertical privity. To run the benefit of the covenant to the successor, the successor need only take an interest that is carved out of the original party’s estate. This is called RELAXED vertical privity.

Question 5

Negative Covenant

Answer 5

A restriction on use will usually touch and concern because they restrict what you can do with your land.

Watch out for promises that are unenforceable such as discriminatory covenants, as those do not touch and concern.

Question 6

Affirmative Covenant

Answer 6

A covenant to pay money (eg, homeowners’ association fees). Traditionally, such fees do not touch and concern, but the modern trend is to say that these fees do touch and concern.

Question 7

Requirements For the Burden to Run

Answer 7

1) Writing

2) Intent to run

3) Touch and concern

4) Horizontal and strict vertical privity

5) Notice

Question 8

Requirements For the Benefit to Run

Answer 8

1) Writing

2) Intent to run

3) Touch and concern

4) Vertical privity (NOT strict)

*NO notice required here!