Servitude

• Servitudes r nonpossessory interests in land –creates

a right to use land poss/owned by some1 else.
• It is more than just a K bc they “run with da land”
and bind or benefit subseq poss/owners of da land.
• There r 2 main types of servitudes:
• Easements and Real Covenants

1
Easements

• Affirmative or negative
• Appurtenant or in gross
• Scope
• Creation
• Termination
 Affirmative Servitudes
An easement is the right of 1 to go onto
land in poss of another and make a
limited use of it.

3
Affirmative Easements
• Affirmative easements restrict the rights
and privileges of the owner or
possessor of the land and are an
encumbrance on the title of the property.

• However, the easement holder and the

landowner may both use the easement
area; but the landowner’s use may not
unreasonably interfere with the
easement’s holder’s use of the
easement for its intended purposes.
4
 Negative Servitudes
•A negative servitude is a
restriction on what an owner can
do with his own land, e.g., no
commercial development
•These are usually called
•Real Covenants or
•Equitable Servitudes
5
Types of Negative Easements

• Solar view easements (to protect access to sunlight for solar

heating or the view from one’s property)
• Historical preservation easements (preventing removal or
alteration of historical structures)
• Conservation easements (preventing development of land for
environmental purposes)
• Agricultural and forest, wildlife habitat, scenic, trail etc.
 Easement Appurtenant
An easement is appurtenant
when the right to use another
person’s land benefits the
easement holder in his
physical use or enjoyment of
another tract of land (i.e., the
easement holder’s land).

7
Easement Appurtenant
Every easement appurtenant
requires 2 pieces of land that
are owned by two diff ppl:
•The dominant estate owned
by the dominant tenant
•The servient estate owned by
the servient tenant
8
Dominant Estate

•The dominant estate is the land

benefited by the easement.
•The owner of the dominant
estate is called the dominant
tenant.

9
Servient Estate

•The servient estate (or servient

tenement) is the land that is
burdened by (or subject to) the
easement.
•The owner of the servient estate
is called the servient tenant.

10
Servient and Dominant Estates

Example:
A owns lot 1 and B owns lot 2, which
are adjoining tracts of land. By a
written instrument, B grants A the
right to cross B’s lot 2 in order to get
access to the dock on the river.
•Which lot is the servient estate?
•Which lot is the dominant estate?
11
Easement Appurtenant

12
Servient and Dominant Estates

•Lot 1 is the dominant estate and A is the

dominant tenant.
•Lot 2 is the servient estate and B is the
servient tenant.
•A’s use and enjoyment of A’s own lot 1 is
benefited by A’s right to use B’s lot 2 for a
special purpose – to access the river and the
dock. Since the easement benefits A in the
use and enjoyment of A’s land, it is an
easement appurtenant.
13
 Easement in gross
• An easement is in gross when it is
intended to benefit the easement holder
personally whether or not the holder
owns any property.
• Every easement in gross requires only
one parcel of land (i.e., the servient or
burdened estate) that is owned by a
person other than the holder of the
easement in gross.
• There is no dominant estate and no
dominant tenant
14
Easement in gross

15
Easement in gross
Example: A owns lot 1 and grants,
by written instrument, to B the right to
build a pipeline across lot 1. B
receives the privilege independent of
B’s ownership or possession of any
separate tract of land.
Why is this an easement in gross?

16
Easement in gross
This is an easement in gross because B’s
right to build the pipeline is independent of
B’s ownership or possession of any
separate tract of land. The easement does
not benefit B in the use and enjoyment of
any land owned/possessed by B.
• An easement in gross can be either
personal or commercial – it is generally
transferable only if it is commercial.

17
What would make this an Easement In
Gross?

18
Profit a prendre
Like an easement, a profit can be
appurtenant or in gross
An easement coupled with the right to
extract or collect a natural resource and
take it away from the owner’s land
Unlike an easement, where there is
ambiguity, courts generally construe it as a
profit in gross rather than appurtenant.
A profit is an interest in land and requires
compliance with the Statute of Frauds
19
Express Easements – Interpretation of
Ambiguous Easements

Green v. Lupo (Wash 1982)

•Is the easement held by the Ps
personal to them (is it an “in gross
easement”) or was it intended to
benefit them in the use and enjoyment
of their land (an “appurtenant
easement”) and thus benefits all of the
tenants on their property?

20
“Runs with the Land”
All easements are said to “run
with the land” -- what does this
mean?
As to the servient estate?
As to the dominant estate?
As to an in gross easement?

21
“Run with the Land”
Servient Estate
An easement is attached to the
servient estate and passes with
the servient estate to any
subsequent owner of the servient
estate. All who possess or
subsequently succeed to title to
the servient estate become
burdened by the easement.
22
“Run with the Land”
Dominant Estate
 An appurtenant easement is attached to the
dominant estate and passes with the
dominant estate to any subsequent owner of
the dominant estate. All who possess or
subsequently succeed to title to the dominant
estate become benefitted by the easement.

23
Express Easements – Scope and
Apportionment

Cox v. Glenbrook Co. (Nev. 1962)

What can the dominant tenant do with
the easement?
•Maintain it and improve it, but
•Cannot enlarge it, or
•Create an unreasonable interference
with or burden on the servient tenant’s
use and enjoyment of the servient
property
24
Express Easements – Scope and
Apportionment
Henley v. Continental Cablevision of St. Louis
County, Inc. (Mo. Ct. App. 1985)
Can an in gross easement be divided (“apportioned”) by the
easement holder?
• If exclusive to the easement holder, then it can
be apportioned by the holder and the servient
tenant has no continuing interest
• If nonexclusive, the servient tenant is deemed
to hold an continuing interest in the easement
that has not been granted to the easement
holder and thus cannot be sold by him.

25
Express Easements – Scope and
Apportionment

Henley v. Continental Cablevision of

St. Louis County, Inc. (Mo. Ct. App.
1985)
• Was there any additional burden on
the property arising from allowing
additional use by CATV?
• General rule: Easements in gross for
commercial purposes are alienable
(i.e., transferrable).
26
Express Easements – Scope and
Apportionment

What is an unreasonable additional burden?

•Same kind of activity but increase in degree or intensity of
use?
•Motorcycles v. one car (Green) = remand to see
•One owner (Quill) vs. 80 homeowners (Cox) = not proved
•Use of general right of way to haul gravel and sand =
unreasonable
•Paving a country road will increase speed of travel =
unreasonable
•Expanding marina from 84 to 230 boats not an
unreasonable burden on the servient estate.

27
Express Easements – Scope and
Apportionment
•What happens if the dominant tenant
subdivides the dominant estate?
•All landowners of the subdivided dominant
estate get to use the easement, unless this
creates an unreasonable burden on the servient
tenant
•Courts generally allow a use of the dominant
estate that increases due to normal
foreseeable development, so long as it does
not impose an unreasonable burden on the
servient estate.
28
 Express Easements – Scope and
Apportionment
What happens if the servient tenant wants to
move the easement?
• Majority rule: Servient tenant must obtain
consent of dominant tenant.
• Minority (Modern) Rule: Servient tenant can
make reasonable changes at his expense if
not an increased burden on dominant tenant
or a decrease in the utility of the easement.

29
Express Easements – Scope and
Apportionment

What happens if I want to enlarge

the dominant estate?
•Majority rule: Dominant tenant cannot
extend the dominant estate because
courts generally assume that the
increased use is an unreasonable
burden on the servient tenant
•E.g., Brown v. Voss (p 536)

30
Review
1. Steve grants Diane “the right to walk over my property to
get from your house to the road.” Is Diane’s easement
appurtenant or in gross?

2. Steve grants Diane “the right to mine coal on my property

for 10 years.” What does Diane have?

3. Steve tells Diane “you can park your car on my property

until I tell you to stop.” What does Diane have?

4. Steve grants Diane “the right to occupy my house for the

next five years, but only for residential purposes.” What does
Diane have?
Example 1

Steve grants Diane “the right

to walk over my property to
get from your house to the
road.”
•Is Diane’s easement
appurtenant or in gross?

32
Example 1

Diane’s easement is
appurtenant, since the
privilege of crossing Steve’s
property benefits her in her
capacity as possessor of her
house.

33
Example 2

Steve grants Diane “the

right to mine coal on my
property for 10 years.”
•What does Diane have?

34
Example 2

Diane has a profit in gross for a term of

years. It is a profit because it involves
removal of a product of the soil; it is in
gross because it benefits Diane
personally and not any land she owns;
and it is for a term of years because of the
duration stated in the grant.

35
Example 3

Steve tells Diane “you can

park your car on my property
until I tell you to stop.”

36
Example 3

•Diane has a license to use Steve’s

land, which is revocable at any
time. It is not an “interest” in
Steve’s land and does not run with
the land.
•How would you change the
conveyance to make it an
easement?
37
Example 3

•The difference between an

easement and a license is a
matter of parties’ intent – look for
language that binds successors
in interest (“heirs, successors,
and assigns”) or that call the use
an “easement.”

38
Example 4

•Steve grants Diane “the right

to occupy my house for the
next five years, but only for
residential purposes.”
•What does Diane have?

39
Example 4

Diane has a lease giving her the

right to exclusive possession of
Steve’s house; it is not an easement
because Steve is not also allowed
to use his property. A lease gives
Diane full possession of the
property for a period of time, not just
a limited right to use the premises.
40
How is an Easement Created?
1. Express easement by grant or reservation
2. Easement by estoppel or “irrevocable
license”
3. Prescriptive easement
4. Implied easements
a. Implied from prior use
b. Implied by necessity

41
How is an Easement Created?

Easements by estoppel,
prescription, and implication
are created by operation of
law rather than by a written
instrument; they are
therefore an exception to
the Statute of Frauds
42
Express Easements Requirements

1. The easement is in writing to

comply with Statute of Frauds,
2. There is notice to subsequent
owners of the servient estate
that the land was burdened with
an easement, AND
3. The original parties intended
the easement to run with the
land. 43
Express Easements Requirements
Writing: a easement is an interest in
land, and so the Statute of Frauds
applies. So, any easement longer
than one year in duration must be in
writing and signed by the grantor (the
holder of the servient estate).
•A grant of an easement is
presumed to be of perpetual
duration unless the grant
specifically limits the interest to a 44
Express Easements Requirements
Creation by Express Reservation –
an easement by reservation arises
when the owner of land conveys title
but reserves the right to continue to
use the tract for a special purpose
after the conveyance.
The grantor passes title to the land
but reserves to himself an easement.

45
Express Easements
Example: Diane, who owns lots 1
and 2, conveys lot 1 to Steve,
“together with a right of way over
lot 2, but reserving the right to lay
a sewer pipe from lot 2 across lot
1 to the public sewer.”
What does Diane have?
What does Steve have?
46
Express Easements
Both Steve and Diane have
easements in each other’s
land
• Steve has an easement by
grant over lot 2
• Diane has an easement by
reservation on lot 1, now
owned by Steve
47
Express Easements Requirements

Notice to the successors

of the servient estate can
be provided in three ways:
1. Actual notice
2. Inquiry notice
3. Constructive notice
48
Express Easements Requirements
Intent to bind successors of the
servient estate can be established
by:
1. A statement in the easement
e.g., the easement “is intended to run with
the land,” or the easement burdens the
owner’s “heirs and assigns”
2. Extrinsic evidence if the
conveyance is ambiguous
49
 Elements:
Easement by Estoppel
1. The dominant tenant has permission from
the servient tenant to use the land
2. The dominant tenant foreseeably and
reasonably relies on the continuation of
the permission.; and
3. The dominant tenant changes its position
in reliance on the continuation of the
easement (e.g., incurs significant
expenditures)
4. The easement is necessary to prevent
injustice, but Ps need not prove fraud.
50
Easement by Estoppel also called an
“Irrevocable License”
• When the parties’ fail to reduce an
easement to writing courts usually hold
that the right of use is a license, which
remains revocable at will by the licensor
as a matter of law.
• A court in equity, however, may enforce
the license as an “easement by estoppel”
or an irrevocable license in order to
prevent injustice.
51
Example

• A has a license to access a road on B’s land to access A’s

house. A spends considerable money to improve the road. B
tries to revoke the license by demanding A pays for it. At this
point, A’s license becomes irrevocable and B is estopped from
revoking it.
Duration of an
Easement by Estoppel
1. Majority rule allows the easement to
continue “to the extent necessary” for
the dominant tenant to realize a
return on his expenditures (limited
duration).
2. Minority rule holds that once the
easement by estoppel or irrevocable
license is conceded, it continues as
long as would any express easement
(potentially forever).
53
Easement by Estoppel

Lobato v. Taylor (Colo. 2002)

The settlers had an easement by estoppel
because:
• Permission was given to the settlers
• Settlers reasonably relied that the settlement
rights would continue
• The settlement rights were necessary to support
the settler’s homes
• The settlers relied on the continuation of the
rights when they moved onto their lands
The dissent?

54
Prescriptive Easements
The doctrine of adverse possession is
applied, by analogy, to long-continued
use of another’s property, creating in
the user a prescriptive right to
continue the use.
Thus, non-permissive use that
satisfies the elements of adverse
possession may, after the statutory
period, ripen into an easement by
prescription.
55
Continuous and uninterrupted

• Simultaneous use by servient tenant does not necessarily

interrupt a prescriptive use (the servient tenant must actually
block the adverse use)
• Continuous can also mean seasonal use
• Tacking is permissive
Open and Notorious

• Use must be open and visible that the landowner will or should
notice the use
Actual

• Must be physically present on the servient estate

• Exclusivity not required
Hostile or adverse use

• Without owner’s permission:

• For example:
• use under a defective deed;
• use to which the servient tenant passively acquiesces;
• use that starts out permissive can become adverse if the claimant
acts beyond the scope of the permitted use or asserts greater
rights than originally received
 Implied Easements
When a possessory interest in
property is conveyed, a court may
imply from the circumstances that
the parties also intended to grant
or reserve an easement as well,
despite their failure to say so in
the deed.

60
 Two Types of Implied Easements
1. Easement implied from prior
use
• Granite Properties Limited
Partnership v. Manns (Il. 1987)
2. Easement implied by necessity
• Finn v. Williams (Il. 1941)

61
 Easement Implied from Prior Use --
Requirements
1. Severance by a common grantor -- one
tract was previously owned and is divided
2. Prior Use is Apparent – one parcel was
previously used for the benefit of the other
parcel in a manner that was apparent and
continuous;
3. Reasonable Necessity -- The use is
“reasonably necessary” for the enjoyment
of the dominant estate. Strict or absolute
necessity is not required.
62
Example

• A owns neighboring tracts, 1 and 2. A lives on Tract 2 and

crosses Tract 1 to reach the road. A sells Tract 1 to B. A
continues using the path on Tract 1 to reach the road for years.
What does A have?
Easement Implied from Prior Use

• An implied easement is based on the

assumption that the parties intended to
permit the preexisting use to continue after
the property was severed, but failed to
express that intention in the deed.
• So, before the severance, one part of the
property must have been used for the
benefit of another part, such as a path in
the front that is used to get to a house in the
back.
64
Easements Implied from
Prior Use
Granite Properties Limited
Partnership v. Manns (Il. 1987)
Why didn’t the plaintiffs claim
the driveways were a
prescriptive easement?
What are the distinctions
between the two?
65
Easements Implied by Necessity --
Requirements

1. A common owner severed the property

2. At the time of the severance the
dominant estate became landlocked
3. The easement is strictly necessary for
ingress and egress; it will not be implied
merely for convenience.

66
Example

• A owns neighboring tracts, 1 and 2. A sells Tract 2 to B. By

severing the tracts, Tract 2 has become landlocked and the
only way to get to any road is by crossing Tract 1. An easement
by necessity has been created.
Easements Implied by Necessity
Finn v. Williams (Il. 1941)
An easement implied by
necessity may lie dormant
through successive owners of
the dominant and servient
estates until the necessity
arises; it still runs with the land.
68
Easements Implied by Necessity --
Requirements
What if the access is available but expensive?
“Strict Necessity” vs.
“Great Necessity”

69
Easements Implied by Necessity

• Duration
• An easement implied by necessity lasts only so long as the necessity exists.

70
Scope of Easements
• Express easement: the language is
controlling in determining what activities
are allowed by the dominant tenant.
• Where the language is ambiguous or
indefinite, the scope of the easement
depends on the intent of the parties, and
can be shown by extrinsic evidence
including prior use

71
Scope of Easements
 Implied easements – the same circumstances
that a court employs to imply an easement are
used to determine its scope (prior use or
necessity). This includes uses that the parties
might reasonably have expected to be
ascertained from the circumstances existing at
the time of the conveyance.
 Prescriptive easement – scope of allowable
use is determined by looking at the use that
took place during the statutory period. Broader
uses are not allowed.
72
Scope of Easements
Use of property by servient
tenant – The servient tenant
retains possession of the servient
estate and can use and enjoy it
so long as it does not
unreasonably interfere with the
dominant tenant’s easement.

73
Termination of Servitudes

• Termination by agreement and release

• Expiration of the stated duration
• Merger of servient and dominant estates
• Abandonment by the dominant tenant
• Condemnation of the servient estate
• Prescription – servient tenant reacquires
easement by adverse possession
• Change in conditions or frustration of purpose

74
Servitudes Part 2
Property Law
Real Covenants
A real covenant is a written
promise to do something on the
land (e.g., maintain a fence) or
not do something on the land
(e.g., conduct a commercial
business).
The difference between a
promise or contract and a real
covenant that “runs with the
land” is that a real covenant
binds or benefits the 76
Requirements for a Real Covenant under
Common Law

1. Writing
2. Intent
3. Privity of Estate, both
a) Horizontal Privity and
b) Vertical Privity
4. Touch and Concern
77
Requirements for a Real Covenant under
Common Law
Privity of Estate was difficult to establish, so
courts, using their equitable powers,
developed a way to get around the lack of
privity:
• If the burdened landowner had notice of the
covenant, courts would enforce it as an
“equitable servitude” against the
burdened landowner, but could only give the
benefitted landowner equitable relief, i.e.,
an injunction, but not money damages.

78
Requirements for an Equitable Servitude
under Common Law

1.Writing
2.Intent
3.Notice to burdened
party, AND
4.Touch and Concern
Privity of Estate is not required
79
Requirements
Real Covenant Equitable Servitude
1.Writing
2.Intent
3.Privity of Estate 1. Writing
a. Horizontal Privity 2. Intent
b. Vertical Privity 3. Notice
4.Touch and 4. Touch and
Concern Concern
80
Requirements: Writing

• The covenant must be in writing in

compliance with the Statute of Frauds.
• If the covenant is written in the original
deed (or lease) it does not also have to
be included in the document conveying
the property to the successor in interest.
• “Declarations” or “CC&Rs” (“Covenants,
Conditions and Restrictions”) are often
used for residential neighborhoods
81
 Requirements: Intent
The parties must intend for the
covenant to bind successors in
interest
• By express language (e.g., to grantee
and “their assigns or successors” or
“this covenant shall run with the land” or
“to bind future owners”) OR
• By inference from the circumstances
surrounding the the
If a covenant benefits creation of the
owner of neighboring
covenant.
land, it is generally presumed that the parties
intended it to run with the land.
82
 Touch and Concern
The covenant must be of a type that
“touches and concerns” or relates to the
land.
This means that the person seeking to
enforce the agreement must establish that
both the benefit and the burden of the
agreement affects both parties as owners
of the land and not merely as
individuals.

83
Touch and Concern– Example 1
Susan promised her neighbor Sam in writing that
she will
(1) not build a house on her property blocking his
view;
(2) build a fence along her adjoining property line;
(3) not smoke; and
(4) volunteer at the Humane Society.
Do these agreements “touch and
concern” Sam’s land?

84
Touch and Concern– Example 1

The benefits of covenants 1 and 2

touch and concern Sam’s land since
his view and privacy are improved and
his land is more valuable as a result.
The burdens of covenants 1 and 2
also touch and concern Susan’s land
because they restrict her use of the
land.

85
Touch and Concern– Example 1

However, covenants 3 and 4 do not increase

Sam’s enjoyment of his land or increase its
value; they benefit only personal interests he
may have and do not touch and concern his
land.
Similarly, covenants 3 and 4 have nothing to
do with Susan’s use or enjoyment of her
land.
So, covenants 1 and 2 meet the ‘touch
and concern’ test but 3 and 4 do not.
86
Touch and Concern– Example 2
A, who owns adjacent lots 1 and
2, agreed with B, the purchaser of
lot 2, that she would not erect a
building of over two stories on lot
1.
Does the agreement touch and
concern lots 1 and 2?

87
Touch and Concern– Example 2
A, who owns adjacent lots 1 and 2, agreed with B, the
purchaser of lot 2, that she would not erect a building of
over two stories on lot 1.
Yes; the burden of the agreement touches and
concerns lot 1 because it diminishes A’s rights
in connection with her enjoyment of lot 1.
The benefit of the covenant touches and
concerns lot 2 assuming A’s promise not to
build enhances the value or utility of lot 2, e.g.,
protects B’s view and privacy.

88
Touch and Concern–Example 3

A owned lots 1 and 2, which were

several miles apart. A conveyed
lot 2 to B and agreed to keep the
building on lot 2 in good repair. B
sells lot 2 to C.
Can C enforce the agreement and
force A to continue to maintain the
building on lot 2?
89
Touch and Concern–Example 3
A owned lots 1 and 2, which were several miles apart.
A conveyed lot 2 to B and agreed to keep the building
on lot 2 in good repair. B sells lot 2 to C.
• The benefit of the covenant touches and
concerns lot 2, but the burden of the
covenant does not touch and concern A’s
lot 1 because it has nothing to do with lot 1.
Thus, the promise by A to keep the building on
lot 2 (now owned by C) in good repair is not a
real covenant and is not enforceable by anyone
except B.
90
Requirements: Privity of Estate

Under the common law rules,

there are two types of privity of
estate, both of which must be
satisfied in order for a covenant
to run with the land:
Horizontal Privity and
Vertical Privity
91
Requirements: Privity of Estate
•Horizontal privity is a specified
relationship between the original
covenanting parties as promisor and
promisee. (Burden only)
•Vertical privity is a specified
relationship between an original
party to the covenant and his
successor.
92
 Horizontal Privity
•Horizontal privity requires that at the time
the promisor entered into the covenant
with the promisee, the two shared some
interest in the land independent of the
covenant.
•This means that there must be some
land transfer (e.g., grantor-grantee)
between the original covenanting parties
with respect to which the promise is
made.
93
Horizontal Privity - Example 1
A and B, neighboring landowners,
agree in writing that neither will
tear down his house to erect a
new structure. B sells his
property to X, who tears down the
house.
Can A sue X for damages?
94
Horizontal Privity - Example 1
No -- A cannot sue X because there
was no land transfer between A and
B when the promise was made, thus
no horizontal privity between them.
At the time A and B made the promise,
there was no shared interest in land
independent of the covenant. Without
horizontal privity, the covenant does
not run with the land and does not bind
X as a successor to B.
95
Horizontal Privity - Example 2
A owns two parcels, each with a house
on it. He sells one of the parcels to B.
In the transfer agreement, A and B
each promises the other that he will
not tear down the house to build a new
structure. B then conveys his parcel to
X, who tears down the house.
Can A sue X for damages?

96
Horizontal Privity - Example 2
Yes, assuming the other elements
of a real covenant are met. A can
sue X for damages because there
was horizontal privity between A
and B (the transfer of land from A to
B) when the covenant was made.

97
Horizontal Privity - Example 3
O, a developer, deeds lot 1 to A.
One week later, in a separate
agreement, A promises O that
she will never use lot 1 for
commercial purposes. Two years
later, A sells lot 1 to B.
Is B bound by the covenant?
98
Horizontal Privity - Example 3
No. The agreement does not
bind B because O and A were not
in privity of estate (they were not
in a grantor-grantee relationship)
when the promise was made.

99
 Horizontal Privity
So . . . no horizontal privity exists where
1. Agreements are between
neighbors but are not part of a
simultaneous conveyance
2. Agreements between grantor/
grantee are not made at the same
time as the conveyance of the
property burdened by the covenant

100
 Vertical Privity

•Vertical privity exists to bind the

successor in interest when the
successor has acquired the entire
estate (duration) held by the
predecessor who made the
agreement.

101
 Vertical Privity
• The “entire estate” refers to the duration of
the property interest held by the promisor at
the time of the covenant, not the amount of
land
• This means that lessees (tenants) are
never in vertical privity with their lessors
(landlords), and are not bound by the
lessor’s covenant, because the lessor always
retains a right to get the property back at the
end of the lease (i.e., a “reversion”).
102
Vertical Privity - Example 1
A and B, owners of neighboring
parcels, each agree to maintain
half of a hedge between the
properties. B gives a long-term
lease to X. X fails to maintain his
part of the hedge.
Can A sue X for damages?
103
Vertical Privity - Example 1
No; A cannot sue X for damages
because there is no vertical privity
between B and X. When X took a
long-term lease, he took only part
(in a durational sense), not all, of
B’s property interest.

104
 Vertical Privity - Example 2
A, who owns lot 1 and lot 2, sells lot 2 to
B and, in the deed, covenants for herself,
her heirs, successors and assigns, to
contribute one-half of the expense of
maintaining a common driveway between
lots 1 and 2. A then transfers lot 1 to C
“for 20 years,” retaining a reversion after
20 years.
If C fails to contribute to the
driveway, can B sue C?
105
Vertical Privity - Example 2

No; B cannot enforce the

covenant against C because C
does not possess the entire
interest (in a durational sense)
held by A, her predecessor in
interest, at the time A made the
promise.
106
 “Relaxed” Privity
In most jurisdictions, the rules for both
horizontal and vertical privity are relaxed
where the successor in interest is trying to
enforce the BENEFIT of the covenant
against the original covenantor.
• Horizontal privity is not required to enforce
the benefit of the covenant against the
original covenantor.
• Vertical privity is relaxed to include lessees
who do not have the entire possessory
interest.
107
Relaxed Privity - Example
A, who owns lot 1, covenants with
her neighbor, B, who owns lot 2, that
“A, her successors and assigns will
keep lot 1 in good repair.”
Horizontal privity is missing because
the covenant was not made as part of
a conveyance of the lot to B.

108
 Relaxed Privity - Example
• If B conveys lot 2 to C, C can still enforce
the benefit of the affirmative covenant
against A because horizontal privity is not
needed for the benefit to run to B’s
successor in interest, C.
• If, however, A conveys lot 1 to D, neither
B nor C can enforce the covenant against
D, because horizontal privity is required
for the burden to run and bind D.
109
 Relaxed Vertical Privity
Similarly, the requirement of vertical privity
is relaxed if the successor in interest
wants to sue to enforce the benefit of a
real covenant.
Thus, if the landlord (A) covenanted with
another party (B) to benefit A’s land and
then A leases the land to C, C can sue B
to enforce the benefit of the covenant
even though C does not hold A’s ‘entire’
interest.
110
 Relaxed Vertical Privity
But, if B leases the land to D, C, the
lessee of A, cannot sue D because
vertical privity must exist for C to sue B’s
successor in interest for breach of the
covenant made between A and B. C
cannot sue D because D, as a lessee of B,
does not have vertical privity with B and is
not required to bear the burden of the
covenant made by B.

111
Equitable Servitudes
An equitable servitude, however, is a
promise enforced only by means of
equitable remedies, such as
• an injunction, or
• a decree of specific performance
One cannot receive damages for
breach of an equitable servitude.

112
 Requirements for an equitable
servitude
1. A writing that satisfies Statute of Frauds
2. Intent to bind and benefit successors in
interest
3. Touch and concern the land
4. Notice (actual, inquiry, and constructive)
to the burdened party; notice is not
required for the benefit to run to a
succcessor
PRIVITY of ESTATE is NOT required.

113
 Neponsit Property Owners’ Assn
Is there privity of estate?
•Horizontal privity?
•Vertical privity? “The plaintiff has
not succeeded to the ownership of
any property of the grantor” but the
plaintiff “is acting as the agent … of
the property owners.”

114
 Neponsit Property Owners’ Assn

To ‘touch and concern’ the covenant

must affect the parties as owners of
land and not just as individuals.
• How can the mere payment of money do
this? The money is used for common
improvements (roads, parks, etc.) that benefit
the landowners in their use of the land. “The
burden of the cost should be inseparably
attached to the land that enjoys the benefit.”

115
Covenants in Subdivisions
and Common Interest
Developments

116
Explosion of Real Covenants

With urbanization and development of cities,

the use of covenants by residential
landowners has greatly increased in the last
century, raising many questions:
What is necessary to bind unit
owners?
What are the rights of unit owners to
enforce covenants against each
other?
What are the rights of unit owners 117
Implied Reciprocal Negative
Servitudes
Restrictions on land use can be implied (need
not be in writing) from the establishment of a
common scheme of development. There
are three requirements :
1. Intent to create a servitude that applies to
all lots (the agreements must be
reciprocal)
2. The agreement is a restriction (a
negative servitude to not do something on
the land)
3. Notice (actual, inquiry or constructive)
of the restriction was given to the party 118
 Implied Reciprocal Negative
Servitudes
Intent to create a servitude
that applies to all lots is usually
demonstrated by a common
scheme of development – at
the time that sales of the
parcels in the subdivision
began, the developer had a
plan that all parcels would be
subject to the restrictive
servitude. If the common
scheme arose after some lots
were sold, those lots are not
bound absent an express
covenant.

119
Implied Reciprocal Negative
Servitudes - Example
A subdivides her parcel into lots 1 through
50. She conveys lots 1-45 by deeds with
express covenants that the lots will be used
for residential purposes. A orally tells the
45 grantees that all 50 lots will be so used.
Later, A coveys lot 46 to a company to build
a convenience store in a deed that contains
no express residential restriction.

Can the residents block the store?

120
Implied Reciprocal Negative
Servitudes - Example
Yes; a court is likely to imply a negative
covenant, prohibiting use for other than
residential purposes on lot 46 because all
requirements are met:
1. There was a common scheme establishing
intent (A’s statement to the first 45 buyers),
2. The servitude was a restriction, and
3. The store had inquiry notice of the
restriction because of the uniform
residential character of the other lots in the
subdivision development.
121
 Evans v. Pollock (Tex. 1990)

• Did the deed restriction on commercial

development apply to the non-lakefront
lots?
• Can a common scheme of development
show intent to restrict some lots but not
others? YES – the grantor’s intent to
leave a tract or parcel out of the
common scheme controls.
So . . . The grantor’s intent is
determinative of what constitutes a
common scheme of development.
122
 Sanborn v. McLean (Mich. 1925)

• Defendants were on notice (both

constructive and inquiry) that due to the
uniform residential character of the entire
neighborhood, their land was similarly
restricted to non-commercial use even
though there was no mention of this in their
deed.
• Majority rule: buyers of unrestricted lots
are on constructive notice of covenants in
other deeds in the vicinity sold by the same
grantor; contra California – see, e.g., Riley
123
 Implied Reciprocal Negative
Servitudes
Riley v. Bear Creek Planning Committee (Cal.
1976)
• No HOA restrictions were recorded against
Plaintiffs’ lot or included in their deed, but they
had actual notice that any modifications such as
their covered walkway had to be approved by the
HOA.
• Held: evidence that Plaintiffs actually knew of
restriction was inadmissible as parol evidence;
the deed had no restrictions and so they were
free to build the walkway without approval.
California rule: Reciprocal negative servitudes are
enforceable only if the restriction appears in the deed
(chain of title) or recorded CC&Rs.
124
 Review of Covenants for
Reasonableness
Modern law enforces covenants under different rules,
generally allowing people to determine land use for the
good of everyone.

The Restatement (Third) requirements:

1. Writing
2. Intent
3. Notice (actual, inquiry, or constructive) and
4. Reasonableness – the covenant is enforceable
unless “unreasonable.” Generally “reasonable”
means that the covenant is not arbitrary, spiteful,
capricious, and does not burden constitutional
rights, restrain alienation or trade, and does not
violate public policy.
125
 Appel v. Presley Cos. (N.M. 1991)

•Homeowners sued Developer for breach of

restrictive covenant when Developer (through
HOA committee) amended CC&Rs, as was
allowed, to lift restriction on development of an
undeveloped lot.
•HELD: Even though the CC&Rs were properly
amended, they are subject to a rule of
reasonableness. The right of HOA to alter or
amend or repeal a restriction is valid so long
as it is exercised in a reasonable manner so as
not to destroy the general scheme of
development.
126
 Davidson Brothers, Inc.

• How did the court originally

decide the issue?
• Davidson won below, and court
of appeals affirmed, but why?
• CTA used the “traditional ‘touch and
concern’ analysis”
• What happened on Katz’s
appeal to the NJ Supreme
Court?
127
 Davidson Brothers, Inc.

NJ Supreme Court held that enforceability of the no

supermarket covenant (“covenant not to compete”)
depends on its reasonableness, with T&C, intent,
notice, writing just factors among several, including:
• The impact of the covenant on the consideration
paid,
• How long does the covenant apply
• Whether it unreasonably restrains trade, and/or
• Whether it interferes with the public interest.
HOLDING: The covenant was so contrary to public
policy that it should not be recognized as a valid
enforceable obligation.
128
 Nahrstedt v. Lakeside Village Condominium Association, Inc. (Cal.
1994)

• Plaintiff’s Argument – the covenant was

unreasonable as to her
• Do we apply an objective or subjective
test of reasonableness?
* CCP sec. 1354: CC&Rs are enforceable
“unless unreasonable” – this creates a
presumption that the covenant is
reasonable and valid

129
 Nahrstedt v. Lakeside Village

•The restriction is presumed to be reasonable

and will be enforced uniformly against all
residents unless it is arbitrary, imposes
burdens on the use of land that substantially
outweigh the benefits to the residents, or
violates a fundamental public policy.
•HELD: the pet restriction is rationally
related to legitimate health, sanitation, and
noise concerns held by the residents of a
high-density development.

130
 Modifying and Terminating Covenants –
Changed Conditions
El Di, Inc. v. Town of Bethany Beach
D’s arguments why the covenant should be terminated:
• The Town had acquiesced to commercial development
contrary to the covenant since the 1920s
• Restaurant patrons could bring in alcoholic beverages and
consume at the restaurant, thus the Town abandoned the
covenant 20 years ago.
• The covenant caused a competitive disadvantage for the
restaurant and limited its ability to control the level of
alcohol consumption by its patrons, creating a public safety
issue.

131
El Di, Inc. v. Town of Bethany Beach

• Did the change in conditions in the town since

the covenant was made render it unreasonable
and therefore unenforceable?
• YES – the change in conditions over time
undermined the purposes of the covenant to
maintain a quiet residential atmosphere; 85% of
the town now allowed commercial development
and alcohol sales in areas near the restaurant

132
Modifying and Terminating Covenants –
Changed Conditions

Under the Restatement test,

covenants will not be enforced if
conditions have changed so
drastically that covenant enforcement
will be of no substantial benefit to the
benefitted land.
•Very strict standard, seldom met

133
 Modifying and Terminating Covenants –
Equitable defenses
• Relative hardship (covenant causes too great a
harm on the servient tenant)
• Acquiescence or Abandonment (dominant tenant
has tolerated violations by servient tenants)
• Estoppel (dominant tenant tells servient tenant that
he will not enforce the covenant)
• Laches (dominant tenant waits too long to enforce)
• Natural duration (the covenant expires by its terms)
• Merger (combination of servient and dominant
estates)
• Release (dominant tenant terminates the covenant)
134