Enforcing a Running Covenant at Law
In property law, covenants that are related to the land can run with the land. That means the covenant attaches to the land so that subsequent owners of the benefited land can enforce the covenant against subsequent owners of the burdened land.
Of course, subsequent owners could voluntarily accept an assignment of contract rights and duties by their predecessors who originally made the contract. But a covenant that runs with the land binds and benefits successors regardless of whether they agree. In effect, the covenant just becomes part of the land.
If a covenant meets the requirements traditionally required by law courts, it’s said to run at law and may be called a real covenant. The practical significance of enforcing a covenant at law is that the benefited party enforcing the covenant may recover damages for breach as well as get a judicial order that specifically enforces the covenant.
(If she wants the other party to comply with the covenant and doesn’t care about damages, she can seek enforcement at law or in equity.)
The requirements for a covenant to run with a parcel of land, whether the benefited land or the burdened land, are as follows:
Intent: The original parties intended the benefit or burden of the covenant to run with the benefited or burdened land. That is, they intended subsequent owners of that parcel of land to be bound by the covenant, benefited by the covenant, or both, as the case may require.
Touching and concerning: The covenant touches and concerns the relevant land. That is, if the benefit is to run with benefited land, it must be sufficiently related to the benefited land. If the burden is to run with the burdened land, it must be sufficiently related to the burdened land.
Vertical privity: The subsequent owner of the relevant land, whether benefited or burdened land, has succeeded to the original party’s estate in at least some of the relevant land.
Horizontal privity: The original parties created the covenant in the instrument transferring the benefited or burdened land, or the covenant relates to legal interests the original parties both had in the same land, such as an easement or a leasehold.
Whenever an original party is involved in an action to enforce a covenant, whether she’s seeking to enforce the covenant or another is seeking to enforce it against her, she’s bound or benefited by virtue of her contract. It doesn’t matter whether the covenant runs with her land.
Whether a covenant runs with land matters only when a successor to an original party is involved in an action to enforce a covenant. So the requirements for a covenant to run with the land apply separately to the benefited land and to the burdened land:
If the original benefited party seeks to enforce the other party’s covenant against someone who bought the other party’s land: The original party only needs to prove that the burden of the covenant runs with the burdened land.
If a successor to the original benefited party seeks to enforce a covenant against the party who originally made the covenant: The successor doesn’t have to prove that the burden of the covenant runs with the burdened land, because the original party is bound by his contract regardless.
She only has to prove that the benefit runs with the original party’s benefited land so that she has the right to enforce the covenant as the current owner of that land.
If a successor to the original benefited party seeks to enforce the covenant against a successor to the original burdened party: The successor to the original benefited party must prove that the benefit runs with the benefited land and that the burden runs with the burdened land.