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Private Restrictions on Land 2011©Cengage Learning. All Rights Reserved.

NATURE OF PRIVATE RESTRICTION Owners contract away rights affecting the potential use of their property. These restrictions on use are either covenants or conditions, cumulatively known as restrictions. Private limitations on land are called covenants, conditions, and restrictions. 2011©Cengage Learning. All Rights Reserved.

Limitations Owners are generally free to limit their land in any manner not against the law. Racial restrictions are in violation of the Constitution and invalid. Restrictions that create a monopoly are unenforceable. 2011©Cengage Learning. All Rights Reserved.

Effect of Restrictions When one parcel is burdened by a restriction, another parcel generally benefits from that limitation. 2011©Cengage Learning. All Rights Reserved.

Creation of Restrictions General plan Contract Deed 2011©Cengage Learning. All Rights Reserved.

Creation of Restrictions General plan Contract Deed 2011©Cengage Learning. All Rights Reserved.

Creation of Restrictions General plan Contract Deed 2011©Cengage Learning. All Rights Reserved.

CONDITIONS & COVENANTS Conditions in Contracts Conditional Promises Conditions Precedent Conditions Subsequent 2011©Cengage Learning. All Rights Reserved.

Conditions in Real Property Law A fact or event the occurrence or nonoccurrence of which creates an estate or interest (and is called a condition precedent) or extinguishes an obligation or estate of the promisor (and is called a condition subsequent). 2011©Cengage Learning. All Rights Reserved.

A covenant is a mere promise to do something, contractual in nature and not tied to the creation or defeating of an estate. 2011©Cengage Learning. All Rights Reserved.

CONDITIONS RUNNING WITH THE LAND The covenant binds successors in interest Conditions always run with the land because they are part of the estate 2011©Cengage Learning. All Rights Reserved.

Requirements 1. The covenant must be in writing. 2. The property must be adequately described. 3. The document must state that it shall run with the land. 4. The document must be recorded. 5. The document must touch and concern the land. 2011©Cengage Learning. All Rights Reserved.

Equitable Servitude If the covenant cannot run because it does not meet the statutory requirements, it may still bind the successors under equitable circumstances. a quasi-covenant is called an equitable servitude. It is a burden on land binding successors through equitable principles. 2011©Cengage Learning. All Rights Reserved.

GENERAL PLAN RESTRICTIONS Developers may impose covenants, conditions, and restrictions, known as general plan restrictions Scope of Restrictions 2011©Cengage Learning. All Rights Reserved.

GENERAL PLAN RESTRICTIONS Equitable Servitude Notice and Intent Stated in Subdivider’s Original Deed Description of Land Bound by General Plan 2011©Cengage Learning. All Rights Reserved.

Modification & Termination General plan restrictions become unenforceable and terminate for the same reasons applicable to restrictions in general, including changed circumstances, public policy, waiver, expiration of term, and mutual agreement. 2011©Cengage Learning. All Rights Reserved.

TERMINATION & UNENFORCEABILITY Enforcement Defenses to Enforcement Changed Circumstances Public Policy Waiver 2011©Cengage Learning. All Rights Reserved.

Natural Termination Certain restrictions terminate automatically without court action. 2011©Cengage Learning. All Rights Reserved.

Natural Termination Some conditions state that they will expire after a set period of time in which case they automatically terminate at that expiration date. 2011©Cengage Learning. All Rights Reserved.

Natural Termination Other conditions terminate by merger. 2011©Cengage Learning. All Rights Reserved.