Key Takeaways
- Real covenants require writing, intent, touch and concern, horizontal and vertical privity
- Equitable servitudes require writing (or common scheme), intent, notice, and touch and concern
- Horizontal privity exists when the covenant is created in connection with a land transfer
- Vertical privity requires the successor to hold the entire interest of the original party (for burden)
- Common scheme doctrine allows enforcement of restrictions against lots without express restrictions
Covenants Running with Land
A covenant is a promise concerning the use of land that can be enforced by or against successors to the original parties. Covenants function like private zoning.
Real Covenants vs. Equitable Servitudes
| Feature | Real Covenant | Equitable Servitude |
|---|---|---|
| Remedy | Damages | Injunction |
| Privity Requirements | Horizontal + Vertical | Neither required |
| Notice Requirement | Recording act governs | Actual, constructive, or inquiry |
| Common Scheme | Not applicable | Can substitute for writing |
Real Covenants (At Law)
Requirements (WITHIN):
W - Writing
Must satisfy Statute of Frauds.
I - Intent
Original parties must have intended the covenant to run with the land. Look for language like "heirs and assigns" or "successors."
T - Touch and Concern
The covenant must relate to the land itself, not just personal obligations.
Benefits touch and concern if: Increases value or use of benefited land Burdens touch and concern if: Restricts owner's use of burdened land
Examples that touch and concern:
- Promises to pay HOA dues
- Building restrictions
- Maintenance obligations
H - Horizontal Privity
The original parties must have a pre-existing relationship connected to the land.
Satisfied by:
- Grantor-grantee relationship (covenant in deed)
- Landlord-tenant relationship
- Easement holders
I - Vertical Privity
Relationship between original party and successor.
For burden to run: Successor must hold the entire estate (not less than) of the original party. For benefit to run: Any successive interest sufficient.
N - Notice
Successor must have notice (actual, constructive, or inquiry).
Equitable Servitudes
More flexible than real covenants—typically enforced through injunctions.
Requirements:
- Writing (Statute of Frauds) OR implied from common scheme
- Intent that covenant run with the land
- Touch and concern the land
- Notice to the burdened party
NO privity required.
Common Scheme Doctrine
When a developer subdivides land intending all lots to be subject to the same restrictions:
Elements:
- Common plan of development existed
- Developer intended restrictions on all lots
- Notice of restrictions (actual, constructive, or inquiry)
Effect:
Restrictions may be enforced:
- Against lots whose deeds don't contain express restrictions
- By and against any lot owner in the subdivision
Evidence of Common Scheme:
- Recorded plat or declaration
- Pattern of restrictions in deeds
- Advertisements, brochures, maps
- Oral representations
Implied Reciprocal Servitude
When developer restricts some lots, an implied reciprocal servitude may burden the remaining lots:
Requirements:
- Developer had common scheme for entire subdivision
- Restrictions intended to benefit all lots
- Purchaser had notice of scheme
Cannot bind lots sold before common scheme existed.
Termination of Covenants
| Method | Description |
|---|---|
| Written release | All benefited parties agree |
| Merger | Benefited and burdened land come under single ownership |
| Abandonment | Multiple violations + acquiescence |
| Changed conditions | Neighborhood changed so substantially that enforcement unreasonable |
| Equitable defenses | Laches, estoppel, unclean hands |
| Condemnation | Government takes burdened land |
Changed Conditions Doctrine
The change must affect the entire subdivision, not just the immediate area.
Comparison: Easements vs. Covenants
| Feature | Easement | Covenant/Servitude |
|---|---|---|
| Nature | Right to use land | Promise about land use |
| Creation | Grant, prescription, implication | Agreement |
| Typical use | Access, utilities | Restrictions on use |
| Remedy | Injunction | Damages or injunction |
Homeowner Associations (HOAs)
Modern subdivisions typically create HOAs with power to:
- Enforce covenants
- Levy assessments
- Adopt rules within delegated authority
Business Judgment Rule generally protects HOA board decisions unless:
- Decision is arbitrary or capricious
- No rational basis exists
- Violates public policy or statute
Developer subdivides land and sells all lots with deeds restricting use to single-family residential. Developer sells Lot 10 last, but mistakenly omits the restriction from that deed. May the owner of Lot 1 enforce the restriction against Lot 10's owner?
A owns Blackacre and sells to B with a covenant that B will maintain a fence. B sells to C. A seeks damages from C for failing to maintain the fence. What must A prove regarding privity?
A subdivision was restricted to residential use in 1960. By 2020, the surrounding area has become entirely commercial, but the subdivision itself remains residential. Can residents enforce the covenant against an owner who wants to open a business?
A developer subdivided a 50-acre tract into 25 lots and recorded a plat showing all lots restricted to single-family residential use. The developer sold Lot 1 to Adams with a deed containing the restriction. Adams later sold Lot 1 to Baker, whose deed also contained the restriction. Baker now wants to build a commercial strip mall on Lot 1. The developer, who still owns Lot 25, sues Baker for damages for breach of the covenant. To recover damages at law, the developer must establish all of the following EXCEPT:
Owen owned two adjacent lots, Lot A and Lot B. Owen sold Lot A to Alpha with a deed stating: "Grantee covenants for herself, her heirs and assigns, that Lot A shall be used only for residential purposes." Owen retained Lot B. Alpha later sold Lot A to Beta without mentioning the restriction, but the original deed from Owen to Alpha was properly recorded. Beta plans to open a restaurant on Lot A. Owen seeks an injunction. Which of the following statements is most accurate?
A developer acquired a 100-lot subdivision and recorded a declaration stating that all lots would be restricted to single-family residential use. The developer sold the first 45 lots with deeds expressly containing the residential restriction. When selling Lot 46 to Purchaser, the developer inadvertently omitted the restriction from the deed, but the recorded subdivision plat clearly showed the common development plan. Purchaser, who inspected only her deed and not the recorded plat, now seeks to build an apartment complex on Lot 46. The owner of Lot 1 seeks to enjoin the construction. The court should: