Covenants

Question 1

Covenants vs. Easements

Answer 1

• easements are paradigmatically about the right to go on land
• covenants are paradigmatically about the right to insist on the use or nonuse of land
• covenants much more likely to impose negative rather than affirmative obligations, vs. easements usually deal w/ affirmative ones

Question 2

Covenants and Public Policy

Answer 2

• if a covenant violates public policy laws, it can be struck down on that ground
• ex: Shelley v. Kraemer

Question 3

Formation of Covenants

Answer 3

• in writing (Statute of Frauds applies)

- no covenants by estoppel, implication, or prescription, b/c typically not about as serious matters as easements

Question 4

Tests for Covenents

Answer 4

• designed to figure out if covenant runs w/ land
• which test depends on the type of legal relief sought (injunctions vs. damages)
  Two Tests:
• equitable servitude test
• real covenant test

Question 5

Tulk v. Moxhay - Facts

Answer 5

• case in which the equitable servitude test invented
• Tulk owned Leicester Square + several houses surrounding it -> sold to Elms, in deed in which Elms promised not to build on the garden
• Ownership passes by several conveyances to Moxhay – his deed says nothing about the promise (although he did technically know about it – had seen it in the deed from Tulk to Elms)
• Moxhay threatens to build on the square -> Tulk sues for injunction and wins

Question 6

Tulk v. Moxhay - Holding

Answer 6

• if equity is attached to the property by the owner, no one purchasing it with notice of that equity can stand in a different situation from the party from whom he purchased
• theory was that Elm would have paid a lower price for the land b/c of the covenant - he shouldn’t be able to turn around and sell it to someone for a much higher price just b/c they wouldn’t be boundby the covenant

Question 7

Three Elements of Equitable Servitude Test

Answer 7

• parties must intend that the promise will be binding on their successors (promise on behalf of “heirs and assigns”)
• successor must have notice of the promise to be bound by the burden of the promise (constructive notice in records counts)
• promise must be one that touches and concerns the land

Question 8

Equitable Servitude Test vs. Real Covenant Test

Answer 8

• equitable servitude test requires notice, real or constructive, whereas real covenant doesn’t
• real covenant test requires full privity of estate between original promisor and promisee and full or partial privity of estate between successors + original parties to the promises, vs. equitable servitude test doesn’t
• both tests require that the original parties intend to bind successors + that the promise must touch and concern the land

Question 9

Neponsit Property Owners’ Assn v. Emigrant Indus. Savings Bank - Facts

Answer 9

• pl = property owners’ assn, + def = bank that acquired one of the parcels in the development at a judicial sale
• HOA brings suit to foreclose on the parcel, after property owner refuses to pay current and back dues for common amenities (roads, paths, parks, beach, sewers, etc.) - payment was stipulated in the covenant

Question 10

Neponsit - Decision + Reasoning

Answer 10

• NY Court of Appeals held that the covenant does touch and concern the land
• emphasized function over form - said this covenant meets touch and concern requirement b/c use of public areas is appurtenant to ownership of estate

Question 11

Test for Touch and Concern

Answer 11

• Bigelow test - covenant touches and concerns the land if it affects someone as a landowner not as an individual
• Prof Smith says he supports a notion a bit like Bigelow, but whatever the interest is should have a synergistic effect w/ the rest of the land (not just an additive effect, should interact w/ the other rights connected to the land)

Question 12

Servitudes and Time

Answer 12

• servitudes run risk of becoming obsolete -> typically need to include some sunset clause or mechanism for amending the original promises w/ something less than unanimous vote

Question 13

Covenants and Changed Circumstances Doctrine

Answer 13

• way of ending the covenant due to changed circumstances
• pretty demanding standard - usually need to show that the restriction will be of “no benefit” to property owners who want to keep it in place (difficult to do, because holdout owners can typically come up w/ some sort of benefit)