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29 Cards in this Set
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Real covenant |
A promise concerning the use of land that benefits and burdens both the original parties to the promise and their successors. Traditional remedy for breach of a real covenant is money damages. |
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Equitable Servitude |
A promise concerning the use of land that benefits and burdens the original parties to the promise and their successors; the remedy for the breach is an injunction |
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Every real covenant has two sides: 1. Burden |
Duty to perform the promise *Six elements must be proven for the burden of the promise to bind the promisor's successors. |
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2. Benefit |
Right to enforce the promise *Four of the elements are required for the benefit to run to the promisee's successors. |
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6 Elements: 1) Statute of Frauds |
The covenant must be contained in a document that satisfies the SOF |
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2) Intent to bind successors |
Original parties must intend to bind their successors. The needed intent is usually found in the express language of the document. |
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3) Touch and Concern |
The covenant must "touch and concern" the land. It must relate to the enjoyment, occupation or use of the property. |
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4) Notice |
The successor must have notice of the covenant. This requirement is satisfied by actual notice, record notice, or inquiry of notice. |
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5) Horizontal Privity |
Concerns the relationship between the primal parties to the promise. Between original parties:
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Mutual Interests |
Do the promisor and promisee hold mutual interests in the same property at the same time? Examples: •Leases– L has a reversionary interest and T has a nonfreehold possessory estate in the same property – the leased premise •Easement – Owners of the dominant & servient tenements have mutual interests (easement & fee simple absolute) in the land |
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Successive Interests |
Did the original party transfer an interest in land (other than just the covenant) to another original party while also restricting the use of land? The transfer of property interest and the creation of the covenant must arise at the same time. |
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6) Vertical Privity |
Concerns the relationship between an original part to the promise and his successor. Test: exists if successor receives the entire estate the original party had. So if A hold a fee simple absolute and conveys it to B, vertical privity exists between them |
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Deep Water Brewing, LLC v. Fairway Resources |
1.SOF 2.Touch and Concern •“[a] covenant touches and concerns the land when, by restricting the use of one parcel, it enhances the value of another”3.Intent to Bind Successors •Does it have to be expressly stated? 4.Vertical Privity •Transfer entire interest? 5.Horizontal Privity •Requires some special special relationship between original parties to the promise. • The trial court concluded that the developer ultimately breached the agreement. • Key development and Johnson agreed that the new houses would not interfere with the view of the lake from the restaurant or its lounge. • The covenants imposed a maximum building height of 16 feet, which prevented any structure from interfering with the lake view from the restaurant and lounge. • The Kenagys brought suit against Defendants for a declaratory judgment and injunctive relief to enforce the provisions of the easement and agreement that protected their view of the lake.• The trial court held that Defendants breached the initial agreement with Ahlquist and that the HOA and Johnson had tortuously interfered with the agreement and imposed a judgment of $245,000 in favor of Plaintiffs. The trial court further held that the Taylors were bona fide purchasers without notice and were therefore not liable to the Kenagys. Defendants, other than the Taylors, appealed. • The Kenagys argued that they could enforce the agreements as real covenants because they were successors to Ahlquist, the original promises. • The covenant here touched and concerned land, and we conclude it therefore reached beyond those obligations that are generally limited to the contracting parties only. • We conclude that both parties to the original agreements intended for the covenants to benefit and bind successors in interest. • Requirements for both: vertical privity and horizontal privity. • We affirm the judgment. |
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Tulk v. Moxhay |
Rule of Law: Since a covenant is a contract between the vendor and the vendee, it may be enforced against a subsequent purchaser who has notice of the contractual obligation of his vendor, even though it does not run with the land. Facts. The Plaintiff sold Leicester Square with the restriction that it be maintained in a certain form as a public “pleasure ground”. The deed restriction was covenant for heirs and assigns requiring that the land be maintained as a square garden. The Plaintiff continued to own homes and live around the square after its sale. In 1808, the person who originally purchased Leicester Square from the plaintiff had notice of the covenant contained in the deed. Forty years later, the property was sold to the Defendant, Moxhay. Moxhal sought to build upon the land on the square. Plaintiff brought a bill for injunction to stop any construction. Issue. Can a covenant restricting a property to a specific use be enforced against a subsequent purchaser? Held. Whether or not the covenant runs with the land, such an agreement could properly be enforced in equity because the one who purchases the land from Tulk had notice of that covenant. Defendant, Moxhal could not stand in a different situation from the owner from whom he purchased the property. An equitable servitude is enforceable by injunction with no regard to privity, so long as the promise is intended to run and the subsequent purchaser has actual or constructive knowledge of the covenant. |
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Real Covenant v. Equitable Servitude |
-Both a promise concerning the use of land that benefits and burdens both the original parties to the promise and their successors. The difference lies in the available remedy. Breach of real covenant is damages while the equitable servitude is enforced by an injunction. |
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Restatement (Third) Servitudes |
•Owner of property to be burdened intends to create a servitude •She enters into a contract or conveyance to this effect that satisfies the S.O.F. •The servitude is not arbitrary, unconstitutional, unconscionable, or violative of certain public policies |
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Common Interest Community |
A planned residential development a)where all properties are subject to comprehensive private land use restrictions and b)which is regulated by a homeowners association. CIC created by a written instrument called a declaration. |
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Declaration 4 basic parts: 1)Homeowners Association |
Has provisions to create the owners’ association and its powers and voting procedures |
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2) CC&R |
Provides for restrictions on use, appearance, construction, and transferability (enforced as real covenants or equitable servitudes) |
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3) Assessments |
Obligates the owners to pay assessments (to finance operation) |
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4) Rights |
Identifies the units and common areas and provides the rights associated with such areas |
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Nahrstedt v. Lakeside Village Condo. Assoc. |
Rule of Law: Agreed-to use restrictions will be enforced unless it is shown that they are unreasonable. Facts. Certain conditions, covenants and restrictions (CC&R’s) were included in the condo developer’s recorded declaration. The pet restriction said that “no animals (which shall mean dogs and cats), livestock, reptiles or poultry shall be kept in any unit.” The Plaintiff purchased a condo and moved in with three cats. Defendant learned of the cats’ presence and demanded removal. Defendant also began charging a monthly fine for violation of the restriction. Issue. Was the restriction so “unreasonable” as applied to indoor cats as to render the restriction unenforceable? Held. Under California law, recorded use restrictions will be enforced so long as they are reasonable. Such restrictions are given deference and the law cannot question agreed-to restrictions. Reasonableness should be determined by reference to the common interest of the development as a whole and not the objecting owner. Since the pet restriction was rationally related to health, safety, sanitation and noise concerns of the development as a whole it was reasonable and must be enforced. Further, the Plaintiff had not shown a disproportionate affect of the restriction on her personally that would prove enforcement of the restriction was somehow unreasonable. |
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Fink v. Miller |
• Parties: Plaintiff C.W. Fink Defendant Shannon Miller • Comments/Other Analysis: There was confusion on what the contract meant. Plaintiff is arguing that this is not an abandonment case and that it was unclear. The court should not determine this on abandonment. The only way for the Millers to win would be abandonment. Court said that this was very visible. Everyone saw it and no one complained about it. • Test to determine abandonment of a Covenant: The appropriate test to determine abandonment of such a covenant requires the party opposing enforcement to prove that existing "violations are so great as to lead the mind of the average [person] to reasonably conclude that the restriction in question has been abandoned. • We affirm the trial court's order denying permanent injunctive relief to Fink and granting summary judgment to the Millers. • Abandonment Test out of the Fink case: Courts consider the "number, nature, and severity of the then existing violation[s], any prior acts of enforcement of the restriction, and whether it is still possible to realize to a substantial degree the benefits intended through the covenant. • The benefit in this case outweighs the burden. • The house will have a larger life span if the house has wood shingles instead of fiberglass shingles or maybe the chance of the house catching on fire is less likely to happen with wood shingles. • We don't have to apply all five of the elements because the first three elements in this case are all that is necessary. |
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Vernon Township Volunteer Fire Department, Inc. v. Connor |
• Prohibiting the sale of alcoholic beverages • 77 people live in this subdivision and only 6 people prohibit the alcohol. • At the time of purchase, the Fire Department did not have actual notice of the restrictive covenant banning the sale of alcoholic beverages on the land. • However the Fire Department did have constructive notice of the restrictive covenant from the title search that its attorney conducted. (bad lawyer) • Only a government agency can exercise an intimate domain right. • The Fire Department sought to have the restrictive covenant prohibiting the sale of alcoholic beverages invalidated because changed conditions in the immediate neighborhood effectively rendered the restriction obsolete. • The trial court granted Judgment in favor of Appellants. • The Superior Court reversed the Judgment of the trial court • Changed conditions outside of the restricted tract do not necessary impair the value of an alcohol restriction to the residents of the restricted tract. |
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Governing Development |
Reasonableness Standard Requires the board to “act reasonably in the exercise of its discretionary powers.” |
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Shaefer v. Eastman Community Association |
• The amenities include a golf course, tennis courts, an indoor pool, cross country, skiing, hiking, and a lake with beaches and facilities for boating and swimming. • Plaintiff's filed an action seeking (1) to enjoin ECA from closing Snow Hill and selling the chairlift; and (2) damages based on trespass, deceit, negligent misrepresentation, violation of RSA chapter 3580A and ultra vires. • The court stated that this is reasonable and that the board is free to close Snow Hill. |
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Assessing Board's Actions Two-Step Process |
(1)Did board act within scope of its authority (or was action ultra vires – beyond the scope of power granted to it)? (2)Did board act reasonably (that is, not arbitrarily or capriciously)? ************* -Board shall “take steps necessary to protect the Association’s assets and insure its financial stability…” -Board shall “buy and sell property when deemed in the best interest of the Association…” -Board shall “take such other action as it may deem necessary to further the purposes of this Declaration or to be in the best interests of the Association…” |
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Shaefer v. Eastman Community Association contd. |
“Provided that a [board’s action] does not contravene either an express provision of the declaration or a right reasonably inferable therefrom, it will be found valid, within the scope of the board’s authority.” |
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Fountain Valley H.O.A. v. Department of Veteran’s Affairs |
• The HOA of Chateau Blanc is sewing Mr. Cunningham, who has Hodgkin's' Disease. • They don't like the way Mr. Cunningham lives because he has garbage that may catch on fire. • Fire department checked Mr. Cunningham's home and did not see a risk of fire. • Individualized approach • The burden outweighs any benefit: What does the year of the clothes have to do with a benefit?• JNOV: Judgment not withstanding the verdict. When a jury makes a finding that is unsatisfied by the evidence the judge could enter a JNOV |
