EXAM NOTES: Freehold Covenants

Question 1

what is the structure for a freehold covenant question?

Answer 1

• Identify parties
• Identify breaches of covenant
• Explain formalities for creating freehold covenants
  o Equitable therefore s53(1)(a) LPA 1925, usually part of the deed
• Do equity first

Question 2

define a covenant

Answer 2

a promise in writing signed by the covenantor

Question 3

what is a positive covenant?

Answer 3

• one where the covenantor has to do something

- hand in pocket test Haywood v Brunswick Permanent Benefit; expenditure of effort or money means it is positive

Question 4

what is a negative covenant?

Answer 4

one where the covenantor is restricted from doing something
- forcing someone to do one thing before they can do another (eg asking for permission before expanding a house) is mainly restrictive Powell v Hemsley

Question 5

What should be done if a covenant is mixed?

Answer 5

1) sever into two covenants Shepherd Homes v Sandham, or if impossible
2) decide if it is overall positive or negative Powell v Hemsley

Question 6

are covenants an interest in land?

Answer 6

covenants can never be legal interests in land

• not on the list of legal interest s1(2) LPA 1925 so can only be equitable
• as equitable interest can only be created by signed writing of the grantor

Question 7

how can the benefit of a covenant pass at common law?

Answer 7

• express assignment

- PA Swift v Combined English Stores

Question 8

how can the burden of a covenant pass at common law

Answer 8

• can never pass
• but can ensure compliance through
  o chain of indemnity
  o perpetually renewing covenants
  o Halsall v Brizell

Question 9

How can the burden pass at equity?

Answer 9

Tulk v Moxhay

1) negative
2) benefits dominant tenement
3) original parties intended burden to run
4) new owner had notice

Question 10

how can the benefit pass at equity?

Answer 10

touch and concern land and (Renals v Cowlishaw)

1) annexation
2) assignment
3) building scheme

Question 11

What goes in the introduction to a covenants question?

Answer 11

1. Details of covenantor/successor + covenantee/successor
2. Definition of terms e.g. dominant/servient land
3. Explanation of breaches
4. Formalities – in order to be a proprietary interest they must comply with s53(1)(a). If you are not told, assume they comply
5. Explain structure i.e. why equity first?

Question 12

how can the benefit be passed at common law by express assignment?

Answer 12

s136 LPA 1925
o Must be in writing
o Notice of assignment must be given to the covenantor.

Question 13

how can the benefit be passed at common law by the method in P&A Swift v Combined English Stores?

Answer 13

1) covenant must touch and concern the land
2) parties must have intended the benefit to pass
3) original covenantee must have held legal estate
4) successor in title to covenantee must hold legal estate

Question 14

how can a covenant touch and concern the land?

Answer 14

P&A Swift v Combined English Stores

1) benefits the land, not the estate owner
2) cannot be expressly personal
3) must affect nature, quality, use or value of the benefitted land

Question 15

how can courts tell if original parties intended the benefit of a covenant to pass?

Answer 15

• express wording to show the covenant relates to the land not the person
• implied by s78(1) LPA 1925

Question 16

what says that the original covenantee must have held a legal estate

Answer 16

s1(1) LPA 1925 no benefit can pass where covenantee has only equitable title

Question 17

what governs whether the successor in title to the covenantee has legal estate?

Answer 17

Smith and Snipes v River Douglas

- successor need not have exactly the same legal estate

Question 18

What governs how burden passes at common law

Answer 18

• burden never passes
• Austerberry’s Case
• Rhone v Stephens

Question 19

what happens to the burden at common law

Answer 19

s79 LPA 1925 stays with the original covenantor

• Tophams v Earl of Sefton
• Only remedy that can be gained is damages

Question 20

what are chain of indemnity covenants?

Answer 20

• Each new purchaser promises to pay the original covenantor in the event of them breaching

Question 21

what is a perpetually renewing covenant?

Answer 21

• seller prevents land being sold without consent of the covenantee
• purchaser then signs a new covenant with the covenantee

Question 22

what is the rule in Halsall v Brizell

Answer 22

• mutual benefits and burdens
• Rhone v Stephens - close correlation between benefit and burden
• Thamesmead v Allotey ‘real choice’ for the owner of the servient land

Question 23

What says that a covenant must be negative for Tulk v Moxhay to apply?

Answer 23

Rhone v Stephens

Question 24

what does ‘accommodate the dominant tenement’ mean?

Answer 24

i) covenantee retained an interest in the dominant tenement BOTH when covenant was made and at the time of enforcement LCC v Allen
ii) covenant must touch and concern the dominant land P&A Swift v Combined English Stores
iii) must be proximity between the land Bailey v Stephens

Question 25

What case law discusses whether a covenant touches and concerns the land

Answer 25

1) definition in P&A Swift v Combined English Stores 2) Newton Abbott v Williamson - anti-competition agreements usually benefit dominant land 3) Wrotham Park v Parkside Homes - restrictive covenants usually benefit dominant tenement - covenants that restrict the use of the land (eg residential only) usually t&c the land - covenants that restrict buildings usually benefit dominant land

Question 26

how do you tell if the original parties intended the burden to run?

Answer 26

- look for express wording of the covenant eg "for herself and her successors in title" - intention implied under s79 LPA 1925 unless express wording to the contrary

Question 27

How can a new purchaser have notice for the purposes of Tulk v Moxhay?

Answer 27

- irrelevant if they have actual notice | - all that matters is registration

Question 28

how can a purchaser of unregistered land have notice for the purposes of Tulk v Moxhay

Answer 28

- Class D(ii) Land Charge on the land register - if so then s198 LPA 1925 - registration gives notice to the whole world - if not then s4(6) LCA 1972 says that a PURCHASER of a legal estate takes without notice

Question 29

how can a purchaser of registered land have notice for the purposes of Tulk v Moxhay

Answer 29

- s32 Notice entered on the charges register - s32 LRA 2002 registration is notice to the whole world - s29 LRA 2002 non-registration means a purchaser of legal estate for value takes without notice

Question 30

How can express annexation of a covenant be shown?

Answer 30

if the benefit of the covenant has been stuck to the land from the outset - eg 'for the benefit of the land known as...' - Rogers v Hosegood - covenant for the benefit of the land was held to have been annexed to it - Renals v Cowlishaw - covenant for the benefit of the covenantee could not annexed - land must be mentioned - covenant benefits each and every part of the land Wrotham Park v Parkside Homes

Question 31

How can statutory annexation of a covenant be shown?

Answer 31

s78 LPA 1925 implies annexation - unless excluded Federated Homes v Mill Lodge - Roake v Chadha can be impliedly excluded eg saying covenants will pass "only if expressly assigned"

Question 32

How can the benefit of a covenant be passed by assignment

Answer 32

- must happen every time land changes hands - must be in accordance with s53(1)(c) LPA 1925 - Miles v Easter must be at the time of sale

Question 33

how can the benefit of a covenant be passed in a building scheme?

Answer 33

- Elliston v Reacher - everyone buys a plot from the same person - intention that the covenants continue - everyone can enforce against everyone else

Question 34

what remedies are available for breach of covenant?

Answer 34

discretionary remedies; - prohibitory or mandatory injunction - damages in lieu of an injunction if too onerous Wrotham Park v Parkside Homes - damages

Question 35

How can restrictive covenants be discharged?

Answer 35

1) expressly ie by deed 2) impliedly if a breach has been allowed for a long time or if one person owns both pieces of land 3) by the court under s84 LPA 1925