Week 5 - Easement and Covenants 3 (9/20/24)

Question 1

It is easier to show breach of a real covenant and get money damages than it is to show breach of an equitable servitude and get an injunction.
A. True
B. False

Answer 1

B.False

There are more elements to be satisfied to get money damages in a real covenant than for an equitable servitude to get an injunction. You have to show three privity in real covenant.

Question 2

There are more elements to be satisfied to get money damages in a ____ _______ than for an _______ _________to get an injunction. You have to show three privity in real covenant.

Answer 2

Real Covenant

equitable servitude

Question 3

_________ ___________ are promises respecting the use of the land that runs with the land at law.

Answer 3

real covenants

Question 4

_______ _________ are enforced at “law” based upon very strict requirements.

Answer 4

real covenants

Question 5

Real covenants are enforced at “_____” based upon very strict requirements.

Answer 5

law

Question 6

They address the issue of whether the benefited party can enforce the burden; in other words, can we make the burden run with the land?

Answer 6

real covenants

Question 7

Breach gets you money damages.

Answer 7

Real Covenant

Question 8

_____ ________ evolved because we needed a property right that was enforceable by and against subsequent purchasers. A mere contract right is sometimes insufficient to solve land use problems.

Answer 8

real covenants

Question 9

Early 19th century in that time promises were not enforceable against a person who wasn’t a party to the contract. One exception: _____ ____ _______ – contract was enforceable by and against the assignee.
In England only happened in a LL/ Tenant here it has involved to include both LL/T and Grantor/ Grantee.

Answer 9

Privity of Estate

Question 10

_____ ________– worried about whether or not someone can enforce the burden running with the land.

Answer 10

real covenants

Question 11

Example of a burden:

Answer 11

Single Family Residential Purposes Only

Question 12

_________ – single family residential purposes only. Limits the way you can operate your property.

Answer 12

Burden

Question 13

With real covenants ________ gets you money damages.

Answer 13

breach

Question 14

Real covenants come in two types: just like easements.
1. ?
2.

Answer 14

1. An Affirmative Covenant

Question 15

Real covenants come in two types: just like easements.
1.
2. ?

Answer 15

2. A Negative Covenant, sometimes also called a restrictive covenant

Question 16

Real covenants come in two types: just like easements.
1.
2.

Answer 16

1. An Affirmative Covenant
2. A Negative Covenant, sometimes also called a restrictive covenant

Question 17

Negative covenants are often called :

Answer 17

Restrictive Covenants

Question 18

GRANTOR –> GRANTEE transaction with a covenant requiring residential use of the property, where grantee conveys to a subsequent purchaser.

When thinking about real covenants we are oftentimes worried about whether or not the burden has gone to the new person?

It shouldn’t be that hard to enforce the covenant against B because B agreed to it, B likely signed something like I am only going to single family residential only. Problem becomes when B transfer to C whether or not the burden runs with the land.

This instance we say it is a grantor/grantee action between A and B.
Is there horizontal privity between A and B? yes.

If A has sold property to B what must B do in their transaction with C in order for there to be Vertical Privity on the burdened side?

Answer 18

FSA. B would have to give a FSA to C in order to transfer a sufficient amount of rights to have privity on the burdened side.

Question 19

Real Covenants Running with the Land
Mr. A owns two adjoining parcels, X and Y, and desires to sell parcel Y to Ms.B. But, A does not want parcel Y used for anything but residential purposes in order to maintain the value of parcel X.

QUESTION: If the conveyance to B includes a covenant requiring residential use, which party, Mr. A or Ms. B, owns the BURDENED PARCEL?

Here, B is a party to the transaction, and takes parcel Y with full notice of the covenant, and, A and B are in PRIVITY OF CONTRACT.

Answer 19

B owns the burdened parcel and A and B are in POC because they have signed agreement where B has agreed not to use the property for anything other than a residence.

Question 20

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1. ?
2.
3.
4.
5.

Answer 20

1. Written covenant (Statute of Frauds)

Question 21

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1.
2. ?
3.
4.
5.

Answer 21

2. Intent that covenant run with the land

Question 22

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1.
2.
3. ?
4.
5.

Answer 22

3. Notice of the covenant to burdened party

Question 23

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1.
2.
3.
4. ?
5.

Answer 23

4. Privity

Question 24

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1.
2.
3.
4.
5. ?

Answer 24

5. Covenant touches and concerns

Question 25

Elements for a Real Covenant.

Requisites for real covenants to run with the land to a new party with the burden:
1.
2.
3.
4.
5.

Assume that A  B transaction of a moment ago. Then B conveys to C. When should A be able to sue C for $$ damages?

All of these have to be met for A to sue C and get money damages. They all have to be met or you cannot get any money damages.

Answer 25

1. Written Covenant (Statute of Frauds)
2. Intent that covenant run with the land
3. Notice of the covenant to burdened party
4. Privity
5. Covenant touches and concerns

Question 26

Real Covenants Running with the Land

Requisites for real covenants to run with the land to a new party with the burden:

How to satisfy the written covenant (statute of frauds):

Answer 26

It to be in writing to satisfy the statue of frauds. –

In a deed or a lease there is a writing.

Relationship between A and B is LL/T or Grantor/ Grantee then you have a written document likely, you absolutely do if it is grantor/grantee – most leases are in writing and that is what we are going to use as our proof for the written element.

Question 27

Real Covenants Running with the Land

Requisites for real covenants to run with the land to a new party with the burden:

How to satisfy the intent that covenant run with the land:

Answer 27

Intent is presumed.

still need to mention it.

Question 28

Real Covenants Running with the Land

Requisites for real covenants to run with the land to a new party with the burden:

How to satisfy the notice of the covenant to burdened party:

Answer 28

if A and B are in a grantor/grantee relationship, person C is going to have notice of the covenant.

Record notice if the deed was recorded.

A and B in a LL//Tenant Relationship C might have notice if C expressly assumed the covenants in the lease.

Question 29

Real Covenants Running with the Land

Requisites for real covenants to run with the land to a new party with the burden:

How to satisfy privity:

Answer 29

Both types of privity must be satisfied: Horizontal and vertical

A and B = horizontal privity (LL/T or Grantor/ Grantee)

vertical privity – 2 tests.

Burdened is same. B and C is on the burdened side and B must have conveyed same estate in land that B has to C.

vertical privity on the benefit side: A and D. test for vertical privity is some. A most convey some of his interest to D, you can give the whole thing.

Question 30

___________ privity is between A and B.

Answer 30

Horizontal

Question 31

What are the two tests for vertical privity?

Answer 31

Burdened is the Same Test.

Benefited is the Some Test

Question 32

Vertical Privity - Burdened is the _________ Test.

Answer 32

Same

Question 33

Vertical Privity - Benefited is the ________ Test.

Answer 33

Some

Question 34

Real Covenants Running with the Land

Requisites for real covenants to run with the land to a new party with the burden:

The covenant has to touch and concern the land. How do we know which covenants touch and concern the land?

Answer 34

affects the physical use and enjoyment of the land. Single family residential purposes only would affect physical use and enjoyment.

Question 35

**If you have to write about real covenants you will want to know these elements. !!

Answer 35

!!

Question 36

As a general rule, a burden will _______ _____ _______ land when it:

Affects the physical use or enjoyment of the land, or the title to the land.

Is to be performed on the land

Affirmative covenant for payment of money: an agreement to pay money does touch and concern the land where the money is spent on services that affect the physical enjoyment or use of the benefited and burdened land.

Benefit and burden must be felt in the capacity as landowners, not just as individuals.

Answer 36

touch and concern

Question 37

In a real covenant context, how do you establish horizontal privity between A and B?

Answer 37

Landlord/ Tenant
Grantor/ Grantee

Question 38

With a grantor-grantee transaction between A and B, when B transfers to C, when can A sue C for money damages?
A. When C breaches and has vertical privity with A.

B. When C breaches and has vertical privity with B.

C. When C breaches and has horizontal privity with B.

D. When C breaches and has horizontal privity with A.

Answer 38

B. When C breaches and has vertical privity with B.

Question 39

B, owner of Blackacre, promised A, owner of Whiteacre, that Blackacre shall not be used for industrial purposes, B sells Blackacre to C, and A sells Whiteacre to D. C constructs a factory on Blackacre. D sues C for damages.

These facts on their own are they enough for us to say for sure that this is a real covenant?

1. Is the covenant in writing?

Answer 39

It doesn’t say in the fact pattern. If B promised to A owner of Whiteacre we don’t know if it was oral or written and if it wasn’t written down, we don’t satisfy the 1st element. Talk about the other elements.

Question 40

B, owner of Blackacre, promised A, owner of Whiteacre, that Blackacre shall not be used for industrial purposes, B sells Blackacre to C, and A sells Whiteacre to D. C constructs a factory on Blackacre. D sues C for damages.

These facts on their own are they enough for us to say for sure that this is a real covenant?

2. Is there intent?

Answer 40

2. Intent is presumed

Question 41

B, owner of Blackacre, promised A, owner of Whiteacre, that Blackacre shall not be used for industrial purposes, B sells Blackacre to C, and A sells Whiteacre to D. C constructs a factory on Blackacre. D sues C for damages.

These facts on their own are they enough for us to say for sure that this is a real covenant?

3. do we know that C has notice of the promise between A and B?

Answer 41

3. B sold it but maybe B didn’t tell C. We don’t know if there is notice. B made the promise to A nothing that tells us that B owns black acre.

We don’t know if B bought it from A.

We don’t know if C has notice because we don’t know if that promise between A and B was written down.

If it was written down and recorded in a deed or lease, then C would have notice. Or if B told C, you could only do residential only then C would have notice.

We don’t have those facts.

Question 42

B, owner of Blackacre, promised A, owner of Whiteacre, that Blackacre shall not be used for industrial purposes, B sells Blackacre to C, and A sells Whiteacre to D. C constructs a factory on Blackacre. D sues C for damages.

These facts on their own are they enough for us to say for sure that this is a real covenant?

4. Do we have Privity?

Answer 42

4. Horizontal privity is not satisfied because we can’t prove A and B had a LL/T G/G relationship

Vertical privity between A and D because A sells to D and you can assume FSA. A didn’t have to give FSA to D, A could have given some of A’s rights but she gave all so we are good on the benefit side.

Vertical privity between B and C yes because B sells to C. Facts tell us that. When it says sells you can assume FSA. If only a life estate or fee simple determinable it would say that if it just says B sells to C FSA has been exchanged. Because B owned BA and then sold to C B has given away all of B’s rights. We have vertical privity on the burdened side.

Question 43

B, owner of Blackacre, promised A, owner of Whiteacre, that Blackacre shall not be used for industrial purposes, B sells Blackacre to C, and A sells Whiteacre to D. C constructs a factory on Blackacre. D sues C for damages.

These facts on their own are they enough for us to say for sure that this is a real covenant?

5. Do we know if it touches and concerns the land?

Can D sue C for money damages and win under these facts? No D cannot!

Answer 43

5. shall not be used for industrial purposes. It relates to the physical use and enjoyment of the land and therefore it touches and concerns the land.

No D cannot

D might be able to sue C and get an injunction. We need a little more information, but we are not as far from that as we are from money damages.

Question 44

They might just be neighbors and A might be by the fire pit and say I know you are thinking about selling and worried the next guy is going to open a factory and B say I won’t open a factory and the guy I sell it to won’t open a factory – no ________ ________ there. Watch out for that in a real covenant context.

Answer 44

horizontal privity

Question 45

Benefit Side and Burden Side

If A –> D and B still owns, and D sues B, D must allege that the benefit runs to D.

Explain:

Answer 45

D will have to allege that the benefit runs to D. Which element relates to the relationship between A and D? vertical privity on the benefit side – that means you would have to satisfy some test that A has transferred some of A’s rights to D or B can’t sue D.

Question 46

If B –> C, who constructs factory, and A still owns, and A sues C, A must allege that the burden runs to C.

Explain:

Answer 46

If B conveys to C and C constructs a factory and A still owns lot 1 and A sues C.
A will have to prove vertical privity on the burdened side by satisfying the same test.

Question 47

If D sues C, D must allege that both the burden and the benefit run.

Explain:

Answer 47

If D is suing C – D will have to how both benefit and burden run and prove vertical privity on both sides.

Question 48

Anytime you have a new person doing the suing or getting sued you have to establish vertical privity between the old people and the new people.

True or False.

Answer 48

True

Question 49

________ _______: Created based upon the relationship between the original parties to the covenant (L  T or Grantor  Grantee).

Answer 49

Horizontal Privity

Question 50

_______ _______: Created based upon the relationship between one of the original parties to the covenant and a new party (e.g., subsequent purchaser C, who takes from B subject to the covenant.)

Answer 50

Vertical Privity

Question 51

B conveys all interest to C, but there is no Grantor-Grantee relationship between A and B (and A and B are not landlord and tenant). Is it a real covenant and why?

Answer 51

No because it was just a promise between neighbors and there is no horizontal privity.

Question 52

When is horizontal privity required to enforce the covenant?

Answer 52

Horizontal privity of estate is required when the party with the benefit (i.e., A) is pursuing enforcement against a new party with the burden, C.

Anytime somebody is suing C you need horizontal privity.

Question 53

When is horizontal privity NOT required to enforce the covenant?
1. ?
2.

Answer 53

1. Between the original parties to the covenant; or

(If somebody is suing B you don’t have to prove horizontal privity.)

Question 54

When is horizontal privity NOT required to enforce the covenant?
1.
2. ?

Answer 54

2. Where the successor benefiting party pursuing enforcement against original burdened party.

(If somebody is suing B you don’t have to prove horizontal privity.)

Question 55

Vertical Privity is always required in order to enforce the covenant against or by a new party.
But,… there are two standards for vertical privity.

Always need vertical privity to enforce the covenant by or against the new party. !!

Answer 55

!!

Question 56

For the burden to run with the land
When the party with the benefit, A, is pursuing enforcement against new party with the burden, C,…

Answer 56

B must have conveyed the same type of interest to C, e.g., fee simple to fee simple.

Question 57

When a new party with the benefit, D, is pursuing enforcement of the covenant against either the original party with the burden, B, or the new party with the burden, C,…

Answer 57

A must have conveyed to D only some of A’s original interest, e.g., D could be A’s tenant, or have a life estate.

Question 58

Real Covenants Running with the Land Hypo
G’r – G’ee between A and B. A wants to enforce ($$$) written covenant to require residential use of the property against C, who takes fee simple from B in a deed.

Answer 58

• Written covenant (Statute of Frauds)? – Yes. Written covenant A and B are in a – grantor/ grantee relationship there is deed between them and helpful because it is prob written in the deed.
• Intent that covenant run with the land? – intent is presumed
• Notice of the covenant to burdened party? – C has notice if this covenant was written into the deed between A and B and recorded C has notice. But don’t want to assume anything so for EXAM say: If this covenant was written into the deed between A and B and recorded C has notice or if it was written into the deed between B and C, even if it wasn’t record C would have notice because C has accepted the deed from B.
• Privity – horizontal and vertical? – horizontal – yes grantor/ grantee, no D so don’t worry about vertical privity on benefit side. Burdened side vertical privity – FSA was exchanged and that is that same that B had and gave to C.
• Covenant touches and concerns? – yes, residential covenant because it concerns the physical use and enjoyment of the land.

Question 59

G’r – G’ee between A and B. D, A’s tenant, wants to enforce ($$$) written covenant to require residential use of the property against B.

Answer 59

• Written covenant (Statute of Frauds)? - written covenant. Grantor/grantee
• Intent that covenant run with the land? - intent presumed
• Notice of the covenant to burdened party? – B agreed to it. B is the one who agreed to it. B has notice because B is burdened.
• Privity – horizontal and vertical? – vertical between A and D yes because A has leased the property to D or D is A’s tenant and that is the legal relationship between the parties and the transfer of rights. Horizontal between A and B – do you need horizontal privity between A and B? WE DON’T

Relationship between A and B is such that B is the person who has agreed and because we are suing the original party with the burden, we don’t have to go through the legal formality to make sure there was a formal document exchange that clarified the relationship because we know B is the person who agreed to it. It still has to be in writing. We have horizontal privity because A and B are in a G/G relationship, but we don’t need it.

• Covenant touches and concerns? – yes because it is regarding the physical use and enjoyment.

Question 60

HYPO: A and B enter into and record an agreement restricting both their respective properties for residential use. B then conveys to C all of B’s interest.

Question: Can A enforce the covenant against C based upon a money damage remedy?

Answer 60

Written – yes record
Intent – presumed
Notice –
Privity – horizontal (new person is being sued) vertical privity met. Horizontal does not say that they are in grantor/ grantee or LL/T. that sounds fancy, but they did not necessarily make it legal. If you have to prove HP to get money damages and you can’t prove A and B are LL/T or G/G you haven’t proven horizontal privity then money damages are unavailable.

Question 61

An _____________ ________, enforceable by injunction, is a covenant respecting the use of land, where the original Grantor and Grantee intended to create a covenant (burdened and benefited parcels) enforceable against successor owners or possessors with notice, regardless of enforceability at law. [created by Tulk v. Moxhay].

Answer 61

equitable servitude

Question 62

An equitable servitude, enforceable by ___________, is a covenant respecting the use of land, where the original Grantor and Grantee intended to create a covenant (burdened and benefited parcels) enforceable against successor owners or possessors with notice, regardless of enforceability at law. [created by Tulk v. Moxhay].

Answer 62

injunction

Question 63

Began because parties intended to create a covenant that ran with the land regardless of its enforceability at law.

Challenging to figure out if there is a real covenant and to be able to get money damages. If you can’t prove those things, it would be unfair to pretend the covenant doesn’t exist.

Answer 63

Equitable Servitudes

Question 64

Tulk v. Moxhay:

If an equity is attached to the real property by the owner, no one purchasing with the notice of that equity can stand in a different situation from the party from whom he purchased. !

Answer 64

!

Question 65

Equitable Servitudes

Requirements for enforcement of equitable servitude against a new party with the burden:
1. ?
2.
3.
4.

Answer 65

1. Intent to run with the landEquitable Servitudes

Question 66

Requirements for enforcement of equitable servitude against a new party with the burden:
1.
2. ?
3.
4.

Answer 66

2, Notice to burdened party, actual or constructive

Question 67

Requirements for enforcement of equitable servitude against a new party with the burden:
1.
2.
3. ?
4.

Answer 67

3. Covenant must touch and concern land

Question 68

Requirements for enforcement of equitable servitude against a new party with the burden:
1.
2.
3.
4. ?

Answer 68

4. Comply with Statue of Frauds (W/ Exception)

Question 69

Easier to get an injunction than money damages because you don’t have to prove ______.

Answer 69

privity

Question 70

Question: How do you distinguish between a Real Covenant and an Equitable Servitude?

_________ __________ attach to the estate in land. _______ ________ sinks its tentacles into the soil burdening the land and not the estate.

Answer 70

Real Covenants

Equitable Servitudes

Question 71

Remedy for breach of Equitable Servitude = __________

Remedy for breach of Real Covenant = __________

Answer 71

Injunction

Money Damages

Question 72

In many states courts of equity and law have merged and you seek injunction, and you might get money damages instead. Apparently if you get an injunction, you can sell it. If the chancery court gives you an injunction to shut down the factory, you can tell them you have a right to shut them down and they might say we will give you money if you let us stay open. The jury may say 100K but the factory thinking about how much it will lose might give you a lot more. !!

Answer 72

!!

Question 73

Creation of Covenants
For a document to be enforceable as a real covenant:
1. ?
2.

Answer 73

1. Must comply with statute of frauds and

Question 74

Creation of Covenants
For a document to be enforceable as a real covenant:
1.
2. ?

Answer 74

2. Cannot arise by estoppel, implication or prescription, as can an easement

Question 75

Equitable Servitude - _______ _______ _______ is not in writing but still enforceable.

Answer 75

reciprocal negative covenant

Question 76

Creation of Covenants
Reciprocal Negative Covenants
Requirements to establish:
1. ?
2.

All the other elements of an equitable servitude.
* Intent to run with the land
* Notice (constructive)
* Touch and concern

Answer 76

1. Common Owner

Question 77

Creation of Covenants
Reciprocal Negative Covenants
Requirements to establish:
1.
2. ?

All the other elements of an equitable servitude.
* Intent to run with the land
* Notice (constructive)
* Touch and concern

Answer 77

2. Scheme of restrictions

Question 78

Creation of Covenants
Reciprocal Negative Covenants
Requirements to establish:
1.
2.

All the other elements of an equitable servitude.
* Intent to run with the land
* Notice (constructive)
* Touch and concern

Answer 78

1. Common Owner
2. Scheme of restrictions

Question 79

Developer who wants to build a subdivision – every house to be 2 stories and brick for example. Common owner developer who owns the whole parcel split into lots. Scheme of Restrictions is the Master plan and what the community will look like. Town houses over here and apartments and amenities in the center or is it community where all of the houses are between 2-300 square feet. What is your plan for how it will look. You have to have a plan.

What does this refer to?

Answer 79

Reciprocal negative covenants

Question 80

If you have an owner of 2 or more lots and they sell one with restrictions of benefit to the land retained the servitude becomes mutual and during the period of restraint the owner of the lot or lots retained can do nothing forbidden to the owner of the lot sold.

These ES are going to be implied even though not in a deed. No, you can’t build a gas station in your backyard because no one else can either. Your property is benefited because your neighbors haven’t don’t this and you won’t do this either. !!

Answer 80

!!

Question 81

If you start with a common owner or developer to a piece of property and they have a master plan, even if your deed doesn’t make specific reference to the restriction – you have to read other deeds and see what the restrictions are because we will hold those applicable to you as well.

Majority view – you can’t get so excited because your deed forgot to mention it, you will be stuck with everybody else in your subdivision in terms of restrictions.
!!

Answer 81

!!