Restrictive Covenants
A restrictive covenant, as used in the real estate context, is basically an agreement imposed upon a buyer of real property to do or not do something. They can be either affirmative (a promise to do something), or negative (to not do something). An example of a standard affirmative restrictive covenant would be a requirement to develop the land is some way; an example of a negative restrictive covenant would be a promise to use the land strictly for residential purposes. There are also two sides to each covenant; a “burden” and a “benefit.” The benefit belongs to the party who can bring an action to enforce the covenant, while the burden side is held by the party against whom the covenant can be enforced. Under traditional common law principles, restrictive covenants “run with the land,” meaning that subsequent owners of land may be able to enforce the covenant or can be burdened by them. In order for a real covenant burden to run with the land, the following requirements must be met: (a) The covenant must be (or have been) reduced to a writing; (b) The promise must “touch and concern” the land; and (c) There must be privity between the parties. Similarly, for a real covenant benefit to run with the land, an additional requirement must be met: (a) There must be a writing; (b) There must have been the intent for the covenant to run with the benefited parcel; (c) There must be privity between the parties; and (d) The restrictions must “touch and concern” the land.
Touch and Concern
In order for the covenant to “touch and concern” the land, the agreement must operate in such a way as to enhance the enjoyment of one parcel of land while burdening the enjoyment of another. An example of an agreement touching and concerning a parcel of land is one in which a covenant has restricted the use of land to residential uses. This touches and concerns the land in that it burdens the one parcel by restricting its use and burdens the other by ensuring a lack of competition for any commercial enterprise that occurs on the other.
Privity
There are two types of legal privity recognized – horizontal and vertical. What privity means in simpler terms is that one party “steps into” the legal shoes of the other, for the purposes of a restrictive covenant.
Horizontal privity exists between the parties who were involved with the initial transfer of the estate. In other words, when one party takes control of land from another horizontal privity generally exists. However, courts recognize two types of horizontal privity: (1) Instantaneous – this exists when the covenant at issue is included within the deed of conveyance; (2) Mutual – this exists when an easement exists that benefits the estate that holds the easement or in a landlord-tenant relationship.
Strict vertical privity exists when a party conveys their property in total (fee simple). What this means is that the land is conveyed to a third party in full, with the covenant attached. Some courts recognize “relaxed” vertical privity, where the party conveying the land retains some interest in the property. This is common in a lease scenario where the original covenanting party leases their interest to a third and retains some future interest.
If you are either trying to enforce a restrictive covenant or attempting to stop the enforcement of a covenant, it is in your best interest to contact a South Florida Real Estate Attorney today. The enforcement of restrictive covenants is a highly specialized area of law, and requires an equally specialized attorney. Contact one of our experienced real estate attorneys today at (954)-779-7009 to have your real estate situation evaluated by a professional.
