Property Law: Waiving a Covenant

By Alan R. Romero

A benefited party may waive her right to enforce a covenant in the future if she doesn’t enforce the covenant in the present. If she accepts or tolerates violations of the covenant, she may indicate that she doesn’t intend to enforce the covenant, and others may reasonably rely upon her apparent waiver of the covenant.

However, a benefited party doesn’t waive her right to enforce the covenant by tolerating violations that don’t affect her property. If the covenant is a uniform covenant applying to a neighborhood, violations farther away from her property may have little or no effect on the use and enjoyment of her property.

Her failure to enforce the covenant in that case doesn’t indicate that she no longer cares about the covenant but simply that the violation wasn’t harmful to her so she didn’t have sufficient reason to take action against the violator.

Similarly, a benefited party doesn’t waive her right to enforce the covenant against big violations by tolerating small violations. Imagine a residential covenant that prohibited even home-based businesses. If a benefited party tolerated some smaller violations of the covenant, such as a tax preparation service and a daycare business, she wouldn’t thereby waive her right to enforce the covenant to prevent a retail store in the future.

In short, a benefited party waives only her right to enforce the covenant against violations that are similar in effect to violations that she hasn’t taken action against in the past.

If the benefited party herself has violated the covenant, the burdened party may raise a different equitable defense called unclean hands. The principle of this defense is that if a person wants to enforce a covenant, she must abide by it herself.

She can’t violate it herself and expect others to follow it. But like the waiver principle, her own small violation doesn’t prevent her from enforcing the covenant to prevent a big violation.