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The impact that a covenant has on a property is often questioned. Covenant can be described as a rule, a promise or an agreement that creates an obligation. A particular property often has a covenant on the title. In such a situation, one party is obliged to abide by the rules made by another. Usually, the purchaser is required to comply with the regulations of the vendor. There are two types of covenants, namely- positive covenants and restrictive covenants. The two types of covenants impact a land differently.
Here’s a discussion that would help you understand the critical concepts associated with positive and restrictive covenant, as well as how lawyers can help you.
Positive Covenant
A positive covenant involves taking some action. For instance, a fence might need to be erected along a boundary. It is usually a contract between the original parties to the deed. It does not bind future landowners. But prospective owners can enforce the covenant against the original owner.
Restrictive Covenant
Restrictive covenants limit the use of land in a particular way. It is usually focused on the benefit of another land. These covenants are said to run with the land. This implies that the benefit and burden of the covenant are related to the land and not the landowner. A restrictive covenant remains enforceable even if one of the original parties decides to sell the land.
Restrictive covenants are used for the following purposes:
- To prevent a house from being used for business purposes.
- To prevent non-domestic animals from remaining on the property, such as chickens and pigs.
- To stop any buildings on the land without the permission of the party who has the benefit of the covenant.
Restrictive covenants often exist in gated communities and condominium developments. The restrictions are focused on preserving a particular style or appearance. It also helps in maintaining the functionality of a community. An owner may be prevented from conducting a business on a residential property. It may also prevent a person from setting up a home office.
The restrictions may also be in the form of architectural guidelines. Renovation plans may be prevented. This will help in preserving the original appearance of a property. For instance, homeowners are not allowed to expand their garage. Homeowners may be restricted from increasing the area of their house beyond a specific limit. The goal is to maintain uniformity in the colour scheme or appearance of properties in a neighbourhood.
Radical alterations harm the value of properties. Thus, it harms the other homeowners in the community. The restrictions are passed on to the subsequent owners when the original owners sell the property. Any violation of the limits can lead to fines and lawsuits. While buying a property, it is essential to know the restrictions imposed on it. Many property lawyers Perth will be able to guide you with the rules regarding restricted covenants.
Impact Of Restrictive Covenant On A Property
The covenant on one land should benefit the other land. It must protect the value or enjoyment of the other land at the current time. A covenant in a particular estate or subdivision may specify the materials built on the land. This creates a positive effect on the neighbourhood and helps in protecting values. Some covenants may specify that mining or quarrying is not allowed. On the other hand, it may be established that only one dwelling can be built on a particular piece of and.
There is an established process to remove a covenant. But it can be expensive. A buyer must have a notice for a restrictive covenant to be enforceable. The covenant must be registered in the title to the property at HM Land Registry. It needs to be registered as a Land Charge if the title is unregistered. The covenant should not be ambiguous or uncertain. It should not contradict any public policy or should not be prohibited by competition law.
Breaching Of A Restrictive Covenant
If a restrictive covenant is breached or in threat of a breach, the immediate remedy is an injunction to stop it. The court has the power to award damages instead of an injunction. Compensatory damages are also given by the court to cover the diminution in the value of the land due to the breach.
What Can Be Done About A Restrictive Covenant
The burden imposed on a property by a restrictive covenant can be removed in various ways. A release from the party that has benefited from the covenant can be taken. The party might be unwilling to give a waiver. In such a situation, compensation is required. Another option is to seek a review by the Lands Tribunal of the Upper Chamber.
They have the jurisdiction to discharge or modify a restrictive covenant. But they cannot change or remove a positive covenant. It is essential to have sufficient knowledge about the meaning and enforceability of a restrictive covenant. You can seek advice from your conveyancer or your solicitor. You can also refer to property lawyers recommended by someone you know.
Tips To Choose The Best Property Lawyers
You can follow these tips to select the best property lawyers:
Check The Experience Of The Lawyers
Check if your property lawyer has adequate experience. An experienced lawyer will be more beneficial for you in case of a lawsuit. A lawyer who has been in the business for a long time will have seen pretty much everything. This means that an experienced lawyer will be able to give you the guidance you need.
Choose an Honest Lawyer
Many property lawyers offer an initial consultation which is free of charge. You can use this to your advantage. Determine if the lawyer is honest and forthcoming. Ask the lawyer about your chances of success. If the lawyer is unusually optimistic, it might mean that the person is dishonest. An honest lawyer will tell you the risks associated with the case.
Final Thoughts
The enforceability of restrictive covenants depends on state laws. Therefore, it differs from one region to another. There are also specific types of clauses that are allowed in restrictive covenants agreements. You should possess thorough knowledge about restrictive covenants to understand their burden on the land.
