Restrictive Covenants

Question 1

Covenant - Basics

Answer 1

• a written promise to do or not do something related to land (ex: maintain a fence, or not build a multifamily dwelling)
• doesn’t grant a property interest (differentiates it from easement)
  -> instead, it’s a contractual promise or limitation regarding land

Question 2

Negative Covenants

Answer 2

• aka restrictive covenants
• promise to refrain from doing something related to land

Question 3

Affirmative Covenants

Answer 3

• promise to do something related to land

Question 4

Covenant vs. Equitable Servitude

Answer 4

• essentially, covenants are a remedy at law, vs equitable servitude is an equitable remedy
  -> on exam, if pl wants money damages, construe as a covenant
  -> if pl wants an injunction, construe as an equitable servitude

Question 5

Running with the Land

Answer 5

• one tract is burdened by covenant + other benefited
• the question of whether the covenant runs with the land addresses whether or not it will bind successors

Question 6

Requirements for Burden to Run

Answer 6

• means any successor in interest to burdened estate will be bound by the covenant as though they themselves agreed to it

WITHN:
Writing - original promise must’ve been in writing
Intent
Touch and Concern
Horizontal and vertical privity
Notice

Question 7

Requirement for Burden to Run - Intent

Answer 7

• original parties must’ve intended for it to run
• usually found in language of conveyance, but can also be inferred from circumstances surrounding creation of covenant
• courts are generous in finding requisite intent

Question 8

Requirement for Burden to Run - Touch and Concern

Answer 8

• promise must affect parties’ legal relations as landowners, not simply the community at large
• restrictive covenants touch + concern the land if restrict burdened landowner in use of particular parcel
• affirmative ones touch + concern if require holder of servient estate to do something that increases obligations in connection w/ the land
  -covenants to pay $ used in connection w/ land + covenants not to compete do touch and concern the land

Question 9

Horizontal Privity

Answer 9

• refers to nexus between original + promising parties
• requires that they be in succession of estate -> means the original covenanting parties need to have been grantor-grantee, landlord-tenant, or mortgagor-mortgagee when the covenant was created
• difficult to establish -> prevents many burdens from running

Question 10

Vertical Privity

Answer 10

• refers to nexus between successor in interest + originally covenanting party
• needs non-hostile connection (contract, devise, or descent)
• only absent when successor acquired interest through adverse possession

Question 11

Covenants - Notice Requirement

Answer 11

• to be bound by a covenant, subsequent purchaser for value must have had actual, inquiry or record notice of the covenant at time of purchase

Question 12

Requirements for Benefit to Run

Answer 12

WITV - if all met, successor of the benefitting party may enforce the covenant:

Writing
Intent
Touch and concern
Vertical privity

• note that it’s easier for the benefit to run than the burden b/c doesn’t require horizontal privity
  -> beneficiary successor can enforce the promise against the original promisor, but not their successor whenever horizontal privity is lacking

Question 13

Remedy for Breach of Covenant

Answer 13

• breach of real covenant generally remedied through money damages (vs. equitable servitude if seeking injunction)

Question 14

Covenant - Termination

Answer 14

May be terminated by:
- written release
- merger of benefitted and burdened estates
- condemnation of the burdened property

Question 15

Equitable Servitude

Answer 15

• a promise that equity will enforce against successors of the burdened land regardless of whether it runs with the land at law
  -> UNLESS the successor is a bona fide purchaser (subsequent purchaser for value w/o notice of the covenant)

Question 16

Equitable Servitude - Creation

Answer 16

• generally created by promises contained in a writing that satisfies SOF

Question 17

Conditions for Equitable Servitude to Bind Successors

Answer 17

WITNES:
Writing - generally, though not always, in writing
Intent
Touch and concern
Notice (benefitted landowner doesn’t need this though)
ES - equitable servitudes

• NO PRIVITY OF ESTATE REQUIRED

Question 18

Donees

Answer 18

• in most states, successors of burdened land who aren’t purchasers are bound by a covenant or es whether or not they had notice

Question 19

General Scheme Doctrine

Answer 19

• implied equitable servitudes
• court will imply reciprocal negative servitude to hold the unrestricted lot holder to the promise
• if a developr subdivides land, + some deeds contain restrictive covenants but others don’t, restrictive parcels binding on all parcels provided that there was a common scheme of development and notice of the covenants

Question 20

Common Scheme Doctrine - Elements

Answer 20

Two elements -when sales began,
A) subdivider had general scheme of residential development which included the defendant’s lot (the scheme may be evidenced by a record plat, general pattern restrictions, or oral representations to early buyers) AND
B) defendant lot-holder had notice of the promise contained in those prior deeds when it took (AIR- actual, inquir, or record notice)

Question 21

Equitable Servitudes - Equitable Defenses to Enforcement

Answer 21

• changed conditions
• person seeking enforcement is violating a similar restriction on own land (unclean hands)
• benefitted party acquiesced in such a way that reasonable person would believe the covenant abandoned or waived (estoppel)
• laches - benefited party failed to bring suit against violator within reasonable time

Question 22

Equitable Servitudes - Changed Conditions

Answer 22

• neighborhood conditions have changed so significantly that enforcement would be inequitable
• changed conditions must be so pervasive that the entire area or subdivision has changed
  -> piecemeal change or pockets of limited change do NOT suffice

Question 23

Equitable Servitudes - Termination

Answer 23

• may be extinguished by:
  1) written release from benefit holders
  2) merger of benefitted and burdened estates
  3) condemnation of burdened property