A covenant relating to land usually sets out what can and cannot be done in respect of that land. Covenants are usually created in a deed between parties, where one party agrees to restrict the use of its land in such a way to confer a benefit on another person’s land. Typically covenants are recorded in a deed, and can be classed in two types: Positive and Negative.
A Positive covenant will generally impose an obligation to carry out some positive action in relation to the land, or to incur some cost on that land. A Positive covenant typically does not run with the land, and is normally tied to the owner who originally agreed to that covenant, rather than tied to the land itself. An example of a positive covenant would oblige a party to repair or maintain a fence or wall or to contribute towards the cost of repair and maintenance by another party.
A Negative, or restrictive, covenant sets out what cannot be done with the land or property. In order for a Negative covenant to be true and valid, it must restrict the usage of land (the servient tenement) and benefit another (the dominant tenement). The restriction on the servient tenement must “touch and concern” that land. This confusing legal requirement remains today and its purpose is to restrict the land to a particular use, such as “not to use land for commercial purposes” for example and is always expressed to be for the benefit of some other identifiable land, generally a parent title.
In this sense, both positive and negative covenants seem clear, and easy to identify. However issues can arise when it becomes difficult to ascertain whether a negative covenant is actually a positive covenant in disguise. In the old case of Tulk v Moxhay [1848] one of these disguised covenants arose and obliged a person to “keep and maintain … [a] piece of ground and square garden, and the iron railing round the same in its then form, and in sufficient and proper repair as a square garden and pleasure ground, in an open state, uncovered with any buildings, in neat and ornamental order.” While this may seem a positive covenant, the maintenance of a garden and its area, the court found it to be negative. The reasons for this is that it amounted to the land owner being obligated to not build on the land.
On the flip side, a covenant which stipulates that a property not be allowed to fall into disrepair, may seem a negative covenant, however, is actually positive, as it requires money to be spent on constant repair.
It is always important to check whether each covenant is truly positive, or truly negative, as the wording may be misleading. Look at the underlying meaning behind each covenant, and use that to help ascertain whether it is positive or negative in nature.
Please do contact the commercial property team on 01206 835316 or via [email protected] for further information or advice.