Chapter 4: Freehold Covenants

Practice flashcards covering the creation, running of benefit and burden, enforcement, remedies, and discharge of freehold covenants.

What is the distinction between a covenantor and a covenantee?

A covenantor makes the promise and is burdened, while a covenantee receives the promise and is benefited.

What is the difference between servient land and dominant land?

Servient land bears the burden of the covenant, whereas dominant land enjoys the benefit.

How does annexation differ from assignment regarding the benefit of a covenant?

Annexation attaches the benefit automatically to the land, whereas assignment is the express transfer of the benefit.

What is the nature and statutory formality requirement for creating a freehold covenant?

Covenants are equitable by nature (not listed in s 1(2)) and require signed writing under s 53(1), usually created in a deed on sale of part.

How are positive covenants distinguished from restrictive covenants?

A positive covenant requires effort or expenditure, while a restrictive covenant does not.

Why does substance govern over wording when classifying covenants?

The actual practical effect determines the nature of the covenant rather than its phrasing; for example, a promise "not to let the property fall into disrepair" is positive because it requires expenditure.

What is the duration of an original covenantor's liability under privity of contract?

The original covenantor is bound forever by privity of contract, and s 79 LPA implies that successors are covered.

What is the rule at common law regarding the running of the burden of a covenant?

At common law, the burden never passes, whether the covenant is positive or restrictive (Austerberry, Rhone v Stephens).

What five conditions must be satisfied under Tulk v Moxhay for the burden of a covenant to run in equity?

(a) Negative in substance; (b) made to benefit dominant land retained by the covenantee; (c) touches and concerns the dominant land; (d) intention to burden the servient land (express words or s 79); and (e) the successor has notice.

What principle was established in London CC v Allen regarding restrictive covenants in equity?

If the covenantee does not retain dominant land to benefit from the covenant, there can be no enforcement against successors.

What does it mean for a covenant to "touch and concern" the dominant land?

It benefits only the dominant owner for the time being, affects the nature, quality, use, or value of the land, and is not merely personal.

How can positive covenants be enforced indirectly using leases?

By creating a lease instead of a freehold, covenants bind tenants' successors, although a lease is generally less attractive than a freehold.

How does an indemnity covenant chain function, and what is its main limitation?

The original covenantor remains liable and sues their successor on an indemnity, which passes down the line of buyers; its main limitation is that it is only as strong as its weakest link.

What is the rule of mutual benefit and burden established in Halsall v Brizell?

A successor taking a benefit (such as using a shared track) must accept the linked burden (such as paying maintenance).

What two criteria are needed for the principle in Halsall v Brizell to apply?

There must be a clear link between the benefit and the burden, and the successor must have a genuine choice whether to take the benefit.

What three requirements must be met for the benefit of a covenant to run at common law without express assignment?

The covenant must touch and concern the land, show intention that the benefit runs (express or via s 78 LPA), and both the covenantee and the successor must hold legal estates.

How can the benefit of a covenant pass at common law via express assignment?

Through an express assignment with the land transfer, made in writing, with notice provided to the burdened party pursuant to s 136 LPA.

What is express annexation in equity?

An express term where the covenant clearly identifies the land benefited (not just stated as "for the benefit of the Seller").

What is statutory annexation under s 78 LPA and Federated Homes?

Automatic annexation for post-1925 covenants that touch and concern the land, provided the benefited land is identifiable in the transfer, which can be excluded by the parties.

What is a building scheme in the context of freehold covenants?

A rare setup where a common owner imposes reciprocal restrictions across multiple lots, enabling all buyers to be mutually benefited and burdened, including by positive covenants.

For a restrictive covenant, how must the burden and benefit match, and who is sued?

The burden passes in equity (Tulk v Moxhay) and the benefit must have passed in equity; the claimant sues the current owner of the servient land.

For a positive covenant, how must the burden and benefit match, and who is sued?

The burden does not pass (the original covenantor remains liable) and the successor must show the benefit passed at common law; the claimant sues the original covenantor (who may then rely on an indemnity chain).

What remedies are available for the breach of a positive covenant?

Damages (a loss must exist, meaning an original covenantee who sold may not be able to claim) and specific performance, which is possible against the original covenantor only.

When will damages be awarded in lieu of an injunction for breach of a restrictive covenant?

When the injury is small, compensable in money, and an injunction would be oppressive (Shelfer, softened by Coventry v Lawrence).

What equitable factors can bar a claimant from obtaining an injunction for a restrictive covenant breach?

Delay, inequitable conduct, or unclean hands.

On what grounds can the Lands Chamber discharge or modify a restrictive covenant under s 84 LPA 1925?

If the covenant is obsolete, impedes reasonable use (offering no practical benefit or being contrary to public interest, with money providing adequate compensation), if benefit holders agreed, or if discharge won't injure them.

What function does s 84(2) LPA 1925 serve?

It can be used to identify the owners of the dominant land.

What non-statutory methods exist to modify or discharge covenants, or protect against their enforcement?

Express release by deed (typically for payment), unity of seisin (common ownership of both lands), or a restrictive covenant insurance policy paid via a one-off premium.