Land Law Tutorial Freehold Covenants PDF

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Land Law Tutorial: Freehold Covenants Essential Preparation ● ●

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Martin Dixon, Modern Land Law (11th edn, Routledge 2018) Chapter 8 Rhone v Stephens [1994] 2 AC 310 (Lord Templeman’s judgment) ○ Facts ■ The owners of a house and the adjoining cottage under the same roof sold the cottage. Under the conveyance, the vendor covenanted for himself and his successors in title as the owners of the house, to maintain the part of the house which was above the cottage in good condition, to the reasonable satisfaction to the purchasers and their successors in title. Both the house and the cottage were subsequently sold. The plaintiffs were the current owners of the cottage and the defendant was representing the estate which owned the house. The plaintiff brought an action against the defendant, claiming that the roof above the cottage was leaking and that the defendant was in breach of the covenant, contained in the conveyance, to repair it. The defendant was held to be bound by the covenant at first instance. On appeal, this decision was reversed. The plaintiff then appealed to the House of Lords, contending that the rule that positive covenants did not run with freehold land had been reversed by s. 79 Law of Property Act 1925. ○ Issue ■ Does the burden of positive covenants run with freehold land? ○ Held - The appeal was dismissed. ■ (1) Following Austerberry v Corporation of Oldham(1885) 29 Ch.D. 750, a positive covenant was not enforceable in common law because the successor in title was not party to the contract containing the covenant. ■ (2) The burden of positive covenants did not run with the freehold and was not enforceable in equity, although breach of a negative covenant which restricted the user of land or the exercise of other rights in connection with land could be prevented or punished in equity. ■ (3) The rule that positive covenants did not run with the freehold was not affected by s. 79 Law of Property Act 1925 which merely made it unnecessary to refer to successors in title in covenants in conveyance. Law Commission, Making Land Work: Easements, Covenants and Profits à Prendre (Law Com No 327, 2011) sections 5.11-5.76 and 5.82-5.91 Pamela O’Connor, ‘Careful What You Wish For: Positive Freehold Covenants’ [2011] 3 Conveyancer 191-207

Questions for Discussion 1. In English land law, can the burden of positive covenants bind successors in the title of freehold land? ● The contractual nature of a covenant means that the original covenantor is under the burden ○ He must refrain from doing something on his own land if the covenant is restrictive (negative), or he must carry out the terms of the promise if the

covenant is positive Any person who subsequently comes into possession of the original covenantor’s land may be subject to the burden of the covenant and be required to observe its terms - whether or not the new owner specifically agrees to the covenant The burden of a covenant may ‘run’ with the land only when the covenant is restrictive ○

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2. In Rhone v Stephens, what did Lord Templeman say about the state of the law on the enforceability of positive covenants and the prospect of reform? ● 3. On reading the journal article by Pamela O’Connor (the Law Commissioner charged with overseeing reform of covenants for the Victoria Law Commission), please answer the following: a. On what grounds is the Austerberry rule usually justified? ● Austerberry v Oldham Corporation ○ Austerberry rule → that the burden of positive covenants does not run in equity ○

While restrictive covenants can run with the burdened land and be enforced against all future owners and occupiers, positive covenants can be enforced only in contract, against the original covenantor ● Many jurisdiction make statutory exceptions to the Austerberry rule to allow public authorities to take the benefit of positive obligations running with land, which are usually held as covenants in gross. For example, legislation may enable planning, conservation of heritage protection covenants between landowners and public authorities to run with land and to impose positive obligations as well as restrictions on future owners. 9 Public authority covenants of this type are a regulatory tool for achieving public regulatory outcomes by agreement rather than by order. They are a special and limited exception to the general rule that positive covenants do not run with freehold title. b. What does O’Connor conclude about the refusal of courts to allow positive obligations to run as freehold covenants? Why does she reach this conclusion? ● 4. On reading the listed excerpts from Law Com No 327, please answer the following: a. What are the ‘practical problems’ connected with positive obligations? ● b. What are the arguments against reform in this respect? ● c. Which jurisdiction allows positive obligations to exist as property rights (and thus be capable of being enforced)? ● d. How did the Law Commission address concerns that the introduction of positive obligations might result in an open-ended range of obligations which overburden land? ●

e. Describe the ‘new legal interest’ proposed by the Law Commission and evaluate its likely success. ●...