FREEHOLD COVENANTS

FREEHOLD COVENANTS

A contractual promise contained in a deed
1. 2 types: Positive - requiring covenantor to do something - some physical action or financial outlay. ie build and maintain boundary
  1. Negative -requiring covenantor not to do something. ie don't use building for business
  2. Acid test - HAYWOOD v BRUNSWICK PERMANENT BENEFIT BUILDING SOCIETY - does the covenant require the expenditure of money? Yes = positive; No = negative
Covenantor - person promising to observe the covenant
1. Servient tenement
Covenantee - person with the benefit of the covenant
1. Dominant tenement
Original covenantor liable to perform the covenant until it ceases. Even if property sold on, still liable.
1. If original covenantor still owns property, remedy would be specific performance or an injunction, if they've moved on, remedy would be damages
  1. Different rules in CL and equity. CL difficult to enforce against covenantors successors so original covenantor is vulnerable
    1. In equity, negative covenants are more easily enforced against successors
START WITH POSITION AT LAW
1. Step 1 - Proving the running of the benefit at CL
  1. Benefit of both positive and negative covenants may pass by either express or implied assignment
    1. Deed may expressly transfer the benefit, but more often implied
      1. Assumed that sale will include covenants.. Consider is it useful for the land or a personal benefit? Covenant cannot be personal
        4 Conditions: Covenant must touch and concern the land - either affect the land as regards it mode of occupation or the value of the land
        From SMITH & SNIPES HALL FARM LTD v RIVER DOUGLAS CATCHMENT BOARD
        X - must have been an intention that the benefit of the covenant should run with the land. Can be express or implied under s78 LPA.
        FEDERATED HOMES v MILL LODGE PROPERTIES LTD - s78 given a wide interpretation, a covenant is deemed to run with the land under s78 unless deed expresses otherwise!
        X - The covenantee (benefitter) must have had a legal estate in the dominant land
        X - New owner must take a legal estate in that land
  2. Step 2 - Prove running of burden at CL
    1. AUSTERBERRY v OLDHAM CORPORATION says that, at CL, burden of covenant cannot run with the land
      1. Confirmed in RHONE v STEPHENS
        Ways around the rule but in majority of situations, exceptions won't help
        The rule in HALZALL v BRIZELL - mutual benefit/burden rule
        if land has benefit of an agreement, he cannot avoid the associated burden of it. ie easement to use driveway coupled with covenant to maintain it
        Operation of a chain of indemnity covenants - but if one person dies or is untraceable, chain broken and original covenantor is still liable
        Positive easements - (spurious easements) relate to cattle trespassing, rarely applied
        Positive easements - CROW v WOOD - says a covenant to fence may be an easement
        Enlargement of long leases - s153 LPA 1925
        Rights of re-entry/rent charges - payment of rent which allows owner to enter land and carry out work if necessary

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