A limitation placed on the use of
property contained in the title for that
property. More specifically, a restrictive
covenant is a contract between two land
owners, by which the person obtaining the
promise (the covenantee) acquires the right
to restrain the covenantor from putting the
land to certain specific uses. Such
contracts between landowners run with the
land and can involve a wide array of
limiting conditions regarding a property.
Restrictive covenants have certain
characteristics:
A dominant tenement (benefited land)
and a servient tenement (burdened land)
must exist.
The covenant must be negative in
nature and represent a burden on the
covenantor’s land. No positive or
affirmative covenant can be imposed on
the land, unless by statute.
The covenant must directly benefit
or enhance the value of the covenantee’s
land.
Both the covenantee’s and
covenantor’s land must be clearly
defined, the agreement between the
owners should state that a covenant is
being imposed, and titles to both
benefited and burdened lands must be
registered (unless provided otherwise by
statute).
The covenant must be reasonable in
nature and not arbitrary or contrary to
the public interest.
Example of Restrictive Covenant
A buyer is
considering a resale property owned by
Seller Smith. Various restrictive covenants
were imposed on buyers within this
subdivision when the new homes were first
marketed. These restrictive covenants run
with the land and must be assumed by Jones.
The following is a brief list for example
purposes:
Six foot maximum height for fences
and only permitted in side and rear yard
subject to front yard setback
requirements.
Prohibited use of television
antennas.
All fuel to be supplied by pipeline
as opposed to individual fuel tanks.
No unauthorized removal of trees or
other significant vegetation, or
alterations to drainage.
Prohibition of clothes lines.
Property restricted to single-family
residence.
Prohibition against the storage of
motor homes, except in enclosed areas.
No alteration to front elevations of
houses or exterior colours on houses,
without approval.
In the case of alterations to
vegetation, house elevations, and
exterior colours on house, such plans
must be first approved by the developer
or his nominee; such approval not to be
unreasonably withheld.
Historically, restrictive covenants were
widely used in residential areas to regulate
the uses to which land could be put. Typical
restrictive covenants prohibited the use of
land for other than residential purposes,
limited building on the land to one-family
dwellings, and required minimum frontage per
house.
A prudent buyer who intends to use the
lands for a specific purpose would be wise
to do some preliminary title investigations
and zoning enquiries before completing
his/her offer to purchase. This research is
particularly important because, if the
restriction is being complied with at the
time of purchase, it cannot be used as an
objection to title unless appropriate
provisos are added to the agreement to
protect the buyer. Exact wordings in
preprinted agreements/contracts concerning
restrictive covenants will vary by province.
Restrictive covenants are usually
created by express promises contained in the
grant of the property to the buyer who has
previously agreed to accept title subject to
these covenants. Restrictive covenants are
often found in subdivisions, where all the
owners are obliged to conform to various
stipulations. These served as the
forerunners of municipal by-laws. Real
estate practitioners should be aware of all
restrictions that affect any subdivision in
which they are marketing homes so that they
can provide accurate information to buyers.
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