Real Covenants and Equitable Servitudes

Real Covenants and Equitable Servitudes (Real Covenant because suing for Damages)
Burden of the Covenant Running at Law
Rule: For the burden of the covenant to run with the land at law, the SOF generally must be
satisfied between the original parties; the original parties must have intended successors to the
promisor be bound; the promise must touch and concern the burdened land; horizontal privity
must be satisfied; and vertical privity must be satisfied.
Burden of the Covenant Running at Law: Statute of Frauds: Signature
Requirement
Rule: For the burden of the covenant to run, the original promisor must be bound, pursuant to
the SOF. The statute requires, among other things, that the writing be signed by the party to be
charged. Element in dispute here, is “signed.”
Argue: Does initially count? Does an X count? Doesn’t someone signing for somone else
count? Purpose is to prevent fraud so the lesser chance as evidence by sig, the better but can use
handwriting sample and expert to prove and witnesses. Depose, cross examine, and illiterate
people sign with X.
Burden of the Covenant Running at Law: Statute of Frauds: Part
Performance
Rule: In absence of compliance with SOF, doctrine of Part Performance will satisfy the
evidentiary requirements of the statute. Part performance requires possession plus payment.
Argue: Part Performance is an equitable principle; real covenant is based on law. Mixes
proverbial apples and oranges.
We no longer have courts of equity and courts of law as such doesn’t make sense to put
barrier between legal and equitable remedies. Restament 3 of Property (servitudes) does not
distinguish btw real covenants and equitable servitudes but refers instead as “servitudes” or
covenants thus any available remedy, equitable or legal is appropriate. If took possession and
paid, evidentiary requirements of SOF are satisfied and part performance is available to bind
Tenant and Successor.
Burden of the Covenant Running at Law: Statute of Frauds: Applicability to
Real Covenants
Rule: According to some authorities, SOF is not applicable to real covenants because real
covenant is not an interest in land.
Argue: In such jx, while may be a question of proof (sig lacking) witnesses can testify to
terms of covenant to pay rent; the signature lacking is not fatal to the binding agreement between
the T and L. The covenant to pay health club dues to not real property and not an interest in land
in theory or in reality
There is an interest in land, the leasehold, which club fees are tied to. The 3 year lease
requires compliance with SOF or substitute (part performance).
Burden of the Covenant Running at Law: Intent
Rule: For the parties to have intended sucessor’s to the promisor be bound, no magic words (to
heirs and assigns”) are necessary; rather we look to the totality of the circumstances.
Argue: Magic words are probative and help determine intent. Words read “tenant is
bound” and not and “assign” help determine intent only tenant is bound.
Would not make sense to only intent original promisor be bound or successors would get
benefits without payment. That would be unjust enrichment.
Burden of the Covenant Running at Law: Touch and Concern

Rule: A promise touches and concerns the land when it relates to the land. A promise relates to
the land when it reduces the landowners rights to the land or reduces the value of the land.
Argue: promise to pay money does not relate to land because anyone can pay Landlord.
Promise to pay 100 reduce value of apt. Any potential tenant will factor fee into rent.
While doesn’t restrict right to land or decrease vaue, it is a promise to pay for upkeep of common
easement, which has been held to be a promise that touches and concerns land.
Burden of the Covenant Running at Law: Horizontal Privity
Rule: Horizontal privity is traditionally established by a landlord tenant relationship. The
restatement, however, does away with this requirement.
Argue: Any illegal activity that occurs should not be rewarded because doing so and thus
recognizing the privity rewards unlawful behavior. Not recognizes serves as a warning.
Since abolished in restatement, to not find here, emphasizes form over substance and is
hyper technical, which serves no purpose.
Burden of the Covenant Running at Law: Vertical Privity (assignment v sublease)
Rule: Vertical Privity exists on the burden side of a real covenant when the promisor transfers all
his interest to the successor, leaving nothing in himself. In such case, this is an assignment. The
Restatement abolishes the vertical privity requirement.
Argue: Transferring “balance of the term to Ted’s apartment to TJ with a provision of
reserved right to use the health club” and did use it once, Ted had small interest (it can not be
said that it was smaller than the right of re entry) that in some Jx even if not exercised, precludes
a finding of assignment.
An oral agreement for using a key once should not trump written terms of a lease and
SOF. SOF is designed to prevent fraud and letting TJ off the hook is tantamount to a type of
fraud on Larry. “Interest” is so small in ted, not even legally recognized, to be contrasted with
right of re entry- a well recognized legal interest. In jurisdiction that adopted Restatement, the
issue is irrelevant.
Benefit in Gross
Rule: In some jx, if the benefit is in gross, the burden will not run. In such a jx, cannot enforce
the covenant.

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Real Covenants and Equitable Servitudes (Real Covenant because suing for Damages)

Burden of the Covenant Running at Law

must be satisfied; and vertical privity must be satisfied.

Burden of the Covenant Running at Law: Statute of Frauds: Signature

charged. Element in dispute here, is “signed.”

people sign with X.

Burden of the Covenant Running at Law: Statute of Frauds: Part

proverbial apples and oranges.

Tenant and Successor.

Burden of the Covenant Running at Law: Statute of Frauds: Applicability to

covenant is not an interest in land.

requires compliance with SOF or substitute (part performance).

Burden of the Covenant Running at Law: Intent

benefits without payment. That would be unjust enrichment.

Burden of the Covenant Running at Law: Touch and Concern

Burden of the Covenant Running at Law: Horizontal Privity

Rule: Horizontal privity is traditionally established by a landlord tenant relationship. The

restatement, however, does away with this requirement.

hyper technical, which serves no purpose.

Burden of the Covenant Running at Law: Vertical Privity (assignment v sublease)

Restatement abolishes the vertical privity requirement.

Argue: Transferring “balance of the term to Ted’s apartment to TJ with a provision of

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