Download - The Nature of Covenants
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THE NATURE OF COVENANTSEULALIE N. GREENAWAY (MS.)
Senior Tutor & Course Director
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What is a Covenant? A contractual obligation imose! or create!
b"#
$ee! Contract un!er seal
Common %a&
Statute
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Covenants imlie! at Common Law 'Landlord
()*uiet en+o"ment,)Not to !erogate -rom the terms o- the grant
.) /n limite! circumstances0 imlie! covenantre 1tness o- roert" -or urose let
2) /n limite! circumstances imlie! covenantto reair
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Covenants imlie! at Common Law 'Tenant
()
To a" rent,) To a" rates 3 ta4es
.)Not to commit &aste
2) To use the remises in a tenant5li6e manner
7)Not to !en" the %an!lor!8s title
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Covenants implied by Statute: 9roert" %egislation0 inclu!ing Registere!
%an! rovisions:
Rent Restriction %egislation ' Landlord() To 6ee the remises in a ;tenantable state o-
reair8,) *uiet en+o"ment
.) To a" all rates 3 ta4es2) To in!emni-" tenant -rom loss arising -rom actso- negligence or !e-ault b" lan!lor!
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Covenants implied by Statute – Tenant:
1.To keep the premises in good order
and condition, air wear and teare!cepted
".To pay rent
#.To keep the premises in a sanitary
condition and to rerain rom conductwhich is a nuisance
$.%ot to commit waste
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&'sual Covenants and Conditions( )
/t &ill be a >uestion o- -act -or the court to
!etermine the relevantalicablecovenants &here an issue arises on thecovenants that -all un!er this term)
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;'sual Covenants and Conditions* ) – cont(d
+n the part o the Landlord:• The covenant o uiet en-oyment
+n the part o the Tenant:• To pay rent• To pay rates ta!es payable by tenant• To keep and deliver up the premises in
repair
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;'sual Covenants and Conditions* ) –cont(d
+n the part o the Tenant:• To permit the landlord to enter, assess
and renew the state o repair
•
/rovision or re0entry or non0paymento rent
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;'sual Covenants and Conditions* ) –cont(d
%ote: Chester v uckingham Travel Ltd
Has not gaine! broa! accetance0 but#
@aNot to a!! to or alter the remises
@bNot to stoc6 u0 !ar6en or obstruct &in!o&s
or light belonging to the !emise! remises@cNot to ermit easements to be ac>uire!
against !emise! remises
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;'sual Covenants and Conditions* ) –cont(d
%ote: Chester v uckingham Travel Ltd.:
!Not to ermit the !emise! remises to beuse! -or uroses other than those seci1e!
e9rovision -or re5entr" -or breach o- covenantsother than the covenant to a" rent)
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;'sual Covenants and Conditions* ) –cont(d
Beneral rincile seems to be that theeculiar circumstances un!er consi!erationan! the realities o- the oeratingenvironment o- the !a" must !irect the!ecision as to
2usual covenants andconditions(.
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Covenants that touch concern theland:
Re-ers to covenants that e4ist bet&een theoriginal lan!lor! an! the original tenant
Carr" bene1ts an! bur!ens -or the arties
involve!
Can be asse! to successors in title
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Covenants that touch concern theland:
3 covenant which runs with the landtouches and concerns the land
Test is whether the covenant a4ects
the landlord in his capacity aslandlord and a4ects the tenant in hiscapacity as a tenant
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Covenants that touch concern theland:
5eneral rule is that all covenants thatrun with the land can be enorced byand are binding on the assignee oeither the landlord or the tenant
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Covenants that touch concern theland:
1. To pay rent
". To repair the property
#. To insure the premises as a privatedwelling house only
$. %ot to assign the lease withoutconsent
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Covenants that touch concern theland:
The -ollo&ing con!itions must be satis1e!&here the tenant assigns his lease
() The lease must satis-" the re>uire!
-ormalities,) The &hole term is legall" assigne!
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Covenants that touch concern theland:
The -ollo&ing con!itions must be satis1e!&here the landlord assigns his reversion#
The lease must satis-" the re>uire!
-ormalities @note that Walsh v %ons!alerincile &ill al"
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Covenants that touch concern theland:
The -ollo&ing con!itions must be satis1e!&here the landlord or tenant assignspart o the lan! onl"#
The covenant &ill be aortione! an! run&ith the relevant severe! art o- the lan!
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Covenants that touch concern the land:
/- no contractual relationshi e4ists bet&eenthe arties an! no !irect relationshi o-lan!lor! an! tenant0 e)g sub5lease#
@a covenant is not en-orceable an! bene1tmust be e4ressl" assignable at la& -orbene1t to be en-orce!
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Covenants that touch concern the land:
/- no contractual relationshi e4ists bet&eenthe arties an! no !irect relationshi o-
lan!lor! an! tenant0 e)g sub5lease#
@b E>uit" allo& the bur!en to run &ith thelan! i- it is a restrictive covenant0 e4cet&here bona 1!e urchaser o- the legal estate&ithout notice o- it0 &ill ta6e -ree o- bur!en
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/rivity o Contract:
6here two or more persons enter into acontract, privity o contract e4ists
7n general, only the parties to thatcontract incur obligations and receive thebene8ts
%ote, however Law o /roperty 3ct 91";<'= section ;>
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/rivity o ?states:
A tenant &ho roerl" assigns his interestto another tenant 0 there e4ists bet&een
the ne& tenant an! the original lan!lor!privity o estates
When a lan!lor! assigns his reversionary
interest to another0 there is privity oestates bet&een the ne& lan!lor! an!original tenant
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The %ature o Covenants