1. Definition
   1. Promise contained in a deed
   2. Any promise about the use of land even if not in a deed
   3. Positive (incurs cost) or negative (restrictive)
   4. Usually imposed on sale of part of property
2. Enforcement: original parties
   1. Original parties
      1. have privity of contract
      2. normal rules of contract law apply
   2. Can third parties enforce the covenant?
      1. s56(1) LPA 1925
         1. Can enforce if covenant purports to be made with the third party
         2. Not sufficient for covenant to be worded to benefit the third party
         3. White v Bijou Mansions Ltd [1937] Ch 610
      2. Contracts (Rights of Third Parties) Act 1999
         1. Applies to contracts entered into from 11 May 2000
         2. Limb 1. Covenant expressly provides that third party may enforce it
         3. OR Limb 2. Covenant purports to confer benefit on third party
            1. but not if it is clear that parties to the covenant did not intend third parties to be able to enforce it
3. Breach of covenant
   1. Possible remedies
      1. Damages
      2. Interim injunction
         1. Pending full hearing
         2. Possibility may have to pay damages if action fails
         3. Delay may enable defence of laches, acquiescence or estoppel
      3. Mandatory injunction
      4. Damages in lieu of injunction
         1. Shelfer v City of London Electric Lighting Co [1985] 1 Ch 287
            1. injury to claimant's right is small
            2. and capable of being estimated in money
            3. can be adequately compensated by small money payment
            4. would be oppressive to defendant to grant injunction
         2. Will be based on figure paid for release of covenant
   2. Cases
      1. Wrotham Park Estate Co Ltd v Parkside Homes Ltd [1974] 1 WLR 798
         1. MI refused as 'waste of houses'
      2. Wakeham v Wood (1982) 43 P&CR 40
         1. MI granted as 'flagrant breach'
      3. Jaggard v Sawyer [1995] 1 WLR 269
   3. Discharge of covenant
      1. s84 LPA 1925
         1. Lands Tribunal
            1. Changes in character of neighbourhood renders obsolete
            2. impedes reasonable use of land
            3. and no practical benefit
            4. or contrary to public interest
            5. persons benefiting have agreed expressly or impliedly
            6. persons benefiting will not be injured
      2. Re Martin's Application (1988) 57 P&CR 119
         1. planning permission is persausive not conclusive factor
      3. May seek express release by deed from covenantee
      4. Would be extinguished by common ownership
4. Enforcement: successors in title
   1. If burden of covenant has passed in equity, equitable rules on passing of benefit have to be applied
      1. If original covenantor is being sued, legal rules for benefit may be applied
      2. If defendant is successor in title to original covenantor, equitable rules should be applied to benefit
   2. Common law rules
      1. The benefit
         1. Annexation
            1. 1. Covenant must touch and concern the land of the covenantee
            2. must affect mode of occupation or value
            3. Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board
            4. AND 2. Both parties must have legal estate
            5. Common law: purchaser must have same estate as original covenantee
            6. Position altered by s78 LPA 1925
            7. Now applies to any legal estate derived from the covenantee
            8. AND 3. Original parties intended benefit to run with the land
            9. May be express annexation
            10. Or statutory annexation
            11. s78 LPA 1925
         2. Assignment
            1. If requirement 3 not met...
            2. Can be expressly assigned to new purchaser
            3. Must take place at time of transfer of land
            4. Must take place each time land passes to new owner
            5. s136 LPA 1925 may apply
      2. The burden
         1. General rule: Burden does not run with the land
         2. Indemnity covenants
            1. Covenantee can still sue original covenantors
            2. Original covenantors may have required indemnity covenants from purchasers
            3. Chain may be broken if one dies, or has no indemnity covenant
         3. Principle of mutual benefit and burden
            1. Halsall v Brizell
            2. Cannot take benefit of a deed without the burden
            3. Rhone v Stephens
            4. Burden must be related to the benefit
            5. Thamesmead Town Ltd v Allotey
   3. Rules of equity
      1. The benefit
         1. Must touch and concern the land
         2. May pass by annexation ...
            1. Express annexation
            2. Federated Homes Ltd v Mill Lodge Properties Ltd [1980] 1 WLR 594
            3. Break in the chain of express assignments
            4. s78 LPA 1925 applied
            5. had the effect of annexing the benefit of the covenant to every part of the land
            6. Now very easy to show annexation
            7. Criticised
            8. Statute was meant to consolidate not change the law
            9. Crest Nicholson Residential (South) Ltd v McAllister [2004] 1 WLR 2409
            10. Land receiving benefit had to be mentioned or defined in document creating covenant
            11. Limits Federated Homes decision
            12. HoL could overturn
         3. ... or assignment
            1. Little reason to consider while Federated Homes decision remains
            2. Parties may still preclude annexation by express wording
            3. Roake v Chadha
         4. ... or by Building Scheme
      2. The burden
         1. Negative covenants
            1. Burden of covenant does not run in equity. Unless, ...
            2. 1. Covenant is restrictive
            3. 2. Parties intended covenant to run with land
            4. Express annexation
            5. wording of covenant
            6. OR s79 LPA 1925
            7. unless expressly states otherwise
            8. 3. Touches and concerns the land
            9. Covenantee must have owned land benefiting from covenant at the time it was entered into
            10. London CC v Allen
            11. purchaser of 'last plot' takes free
            12. Building Schemes
            13. 4. Purchaser with notice buys subject to covenant
            14. Tulk v Moxhay (1848)2 Ph 774
            15. Class D(ii) land charge in LCR - unregistered land
            16. Notice on charges register - registered land
         2. Positive covenants
            1. Positive covenants do not run in equity
            2. Austerberry v Corporation of Oldham (1885) 29 ChD 750
            3. Would be equivalent to requiring performance of contract although not party to it
            4. Rhone v Stephens [1994] 2 AC 310
      3. Building Schemes
         1. Restrictive covenants only
         2. Allows benefit and burden to run with land
         3. Elliston v Reacher [1908] 2 Ch 374
            1. 1. Claimant and defendant's titles derived from common vendor
            2. 2. Land had been set out in plots before sale
            3. 3. Restrictions had been intended to benefit each of purchasers
            4. 4. Lots purchased on understanding that restrictions were to benefit all lots
            5. Relaxed in later cases
            6. Baxter v Four Oaks Properties Ltd [1965]
            7. not divided into lots
            8. Re Dolphin's Conveyance [1970]
            9. simply require evidence of common intention