Covenants

Explain covenant [positive and restrictive], covenantor, convenantee and the

original covenant and examples
What is the position under contract law? Words of the contract must be clear
o Contract law? Words of the contract must be clear (Dano v Earl Cadogan
[2003] words interrupted were working class as this changed from time to
time)
S56 (1) of LPA 1925 states that a party can gain advantage of a covenant even if
they are not a party of the covenant.
o Re Ecclesiastical Commissioner of England conveyance [1935] which said
that a party which gets the benefits of the land should be regarded as the
covenantee even though they may not be one of the parties. Emphasis
here on the wording of the covenant
o Re Foster [1938] the third party must show that the covenant purported
him.
o Amspop Trading Ltd v Harris Distribution Ltd [1997]- case confined to its
own facts states that A could not enforce the covenants. Someone who
was not a party to a contract could take advantage of it under s.56 only
where it had been made for his benefit and a third party could not rely on
the provision unless the covenant actually purported to be made with him.
Therefore the person taking advantage of the covenant under s56 of the
LPA must be clearly identifiable through the deed and must be present at
the time of the covenant.
Benefit of the negative covenant at common law
o touches and concerns:
under common law the covenantee must own the land which
gains the benefits of the covenant
this rules distinguishes between a personal covenant and a land
covenant
P and A swift investment v Combined English stores group a
covenant touches and concers if;
The benefits ceases if the covenantee is separated from the
benefited land
If the covenant affects the nature, quality, mode of use or
value of benefited land
If the covenant is not a personal covenant
o original parties intended the covenant to run with the land
S 78 of LPA 1925 Benefit of covenants relating to land.
(1)A covenant relating to any land of the covenantee shall be
deemed to be made with the covenantee and his successors
in title and the persons deriving title under him or them, and
shall have effect as if such successors and other persons
were expressed.

o covenantee owned the legal (not equitable) estate in the benefitting land
when the covenant was made
Webb v Russell (1789)
o person enforcing the covenant has the same legal estate as the
covenantee
Smith v River Douglas [1949]
Burden of the covenant at common law the burden will not run
o The courts will not enforce the burden upon anyone who has not
covenanted
Austerberry v Corporation of Oldham (1885)
Rhone v Stephens [1994]
In equity the benefit will run:
o The covenant touches and concerns
o The benefit has been transferred by either:
Annexation
Expressly annexed
assignment
Building scheme
In equity the burden becomes equitable interest if the rules of tulks v moxhay are
satisfied:
o the covenant must be negative in nature
Austerberry v Corporation of Oldham (1885)
Rhone v Stephens [1994]
o the covenantee must have retained the land at the date of the covenant
London County Council v Allen- here the land was convenanted
on by the builder, Covenantor, not to build on a particular piece of
land. The covenantee was the council and Mrs Allen after buying
the land with the knowledge of the covenant decided to build on it
and when brought to court, the court allowed her not to be bound
by the covenant as the land was only possessed by the council
not owned.
Re Gadds Land Transfer (1966) retention of a road was
sufficient to enable enforcement.
exceptions:
building schemes
statutory exceptions favouring the authorities
lease held covenant
o the covenant must touch and concern the dominant land
same to touch and concern under
o Both of the original parties must intend that the covenant shall run with the
covenantors land.
expressly stated
S79 of LPA

Morrells of Oxford Ltd v Oxford United Football Club [2001]unless the court can prove that the intention for the burden to run
is expressly excluded.
Where the burden runs in equity, the benefit must be made to run in equity
o Expressed annexation
for the benefit land named Roger v Hosegood
o Implied annexation
Marten v Flight Refueling Ltd [1962]
o Statutory annexed
Federated Homes v Mill Lodge Properties (1980 CA)
Accepted in Roake v Chadha (1984)
o Assignment
Re Pinewood estates
o Building Schemes
Building Scheme requirements: (Elliston v Reacher (1908))
Claimant and defendant must have derived title from
common vendor
Common vendor laid out the estate in plots
Extent of the scheme is clearly defined
Common vendor intended the restrictions to be for the
benefit of all plots sold
Plots were purchased on the basis that the restrictions were
mutually enforceable
If there is a building scheme:
Each of the plot owners can enforce restrictive covenants
against all / any of the other plot owners
If there is no building scheme:
Covenant enforcement will be dependent on the usual rules
for transmission of the benefit and burden of the covenants
if Tulks v Moxhay is satisfied then burdens equitable interest, will it bind the
successor?:
o Registered land: only if it is protected by entry of a Notice on the Title
Register of the burdened land
o Unregistered land post-1925: only if registered as a Class D(ii) Land
Charge
o Unregistered land pre-1925: doctrine of notice applies; BFPFVWN takes
free
Importance of equity
o Claim in equity only gives equitable remedies (injunction, specific
performance)
o However, since 1858, the Court can award damages in lieu
Positive covenants
Chain of indemnity
Halsall v Brizel [1957] - an agreement to contribute to the cost of
maintaining repairs was binding on a subsequent owner, on the

principle that you cannot take the benefit of these rights yet avoid
the burdens of them.
S56 LPA v (Rights of Third Parties Act 1999)
o To use S 56 LPA 1925(Extends the definition of original covenantee), the
covenant must purport to be made with the person claiming the benefit
o Contracts (RoTP) Act 1999 (Expands the group of people able to enforce
the benefit of a contract) can be used if the covenant purports to confer a
benefit on the person claiming the benefit