Restrictive Covenants

RESTRICTIVE COVENANTS

The term “restrictive” usually refers to agreements that restrict the use of land in land and property matters. These agreements have become known as restrictive covenants. An example would be a covenant prohibiting development. This is contrary to a positive covenant, which mandates the owner of the land to do something, for instance maintaining a fence. Therefore a prospective purchaser of land subject to restrictive covenants must know about their effect; and needs advice regarding whether they are enforceable; whether they could be discharged or varied.

The law enables the discharge or variation of covenants subject to certain circumstances.
Acting in breach of a restrictive covenant can lead to serious consequences in that the party with the benefit of the covenant might be able to prevent a breach by obtaining an injunction or even able to restore the previous position, for instance, to demolish a development; and if he is unable to obtain an injunction he might be entitled to substantial damages.

Whether you are subject to a restrictive covenant or have the benefit of one, getting advice on the enforceability of the covenant and available remedies is highly recommended.

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