covenant that runs with the land

A covenant that runs with a land is a covenant that transfers when ownership of the attached land transfer. The future owner of the property subject to a covenant that runs with the land is bound by that covenant.

A property covenant is an agreement between two or more parties regarding certain use of a piece of real property . The covenant will either benefit or burden the landowner. A covenant that burdens the landowner is also called a restrictive covenant .

There are two types of restrictive covenants: affirmative and negative.

  • An affirmative covenant obligates a person to act.
    • For example, a covenant that requires the homeowner to keep the trees trimmed in the yard is an affirmative covenant.
  • A negative covenant prohibits a person to act.
    • For example, a negative covenant can forbid a homeowner from building a fence.

In a covenant that runs with the land, the subsequent landowner of property subject to the covenant will continue being burdened or benefited by the covenant. This is in contrast to a personal covenant, or a covenant that only binds the original parties of the covenant and will not pass to the subsequent parties.

To decide whether a covenant will run with the land, different jurisdictions look for different elements. The four standard elements to establish a covenant that runs with the land include:

  1. Intent to run with the land at time of covenant formation
  2. Whether the subsequent landowner has notice
  3. Whether the covenant has touches and concerns the land
  4. If horizontal/mutual and vertical privity exists between the parties

The same jurisdiction can also look for different elements when the covenant burdens rather than when it benefits the landowner.

  • For example, in California, the court looks for all four elements if the covenant at issue burdens the landowner - while the court will only look for intent, touches and concerns, and privity if the covenant at issue benefits the landowner.
  • In Tennessee, however, the court only looks for intent, touches and concerns, and privity regardless of whether the burden or benefit runs with the land.

[Last reviewed in July of 2022 by the Wex Definitions Team ]

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