Freehold covenants are promises by deed between neighbouring landowners, classified as positive (requiring expenditure or effort) or restrictive (prohibiting a use). Substance prevails over form: a promise “to keep land as an open space” is substantively restrictive.
Enforceability Between Original Parties
Between the original parties, privity of contract applies. Under s 79 LPA 1925, the original covenantor is deemed to promise for themselves and their successors, so they remain personally liable even after selling — hence the use of a chain of indemnity covenants.
The Running of the Benefit
At common law the benefit runs if the covenant “touches and concerns” the land, the parties intended it to run, the covenantee held a legal estate, and the successor derives title. The “touch and concern” test was refined in P. & A. Swift Investments v Combined English Stores. Section 78 LPA 1925 provides statutory annexation: in Federated Homes v Mill Lodge Properties, s 78 automatically annexed the benefit, though Crest Nicholson v McAllister requires the benefited land to be identifiable from the deed.
The Running of the Burden
The strict rule (Austerberry v Oldham Corporation, reaffirmed in Rhone v Stephens) is that the burden never runs at common law. Equity makes a limited exception for restrictive covenants under Tulk v Moxhay: the covenant must be negative in substance, touch and concern the retained land, be intended to run, and be protected by registration (a notice on the Charges Register, or a Class D(ii) Land Charge in unregistered land). An injunction can then be sought against a successor.
Positive Covenants and Workarounds
Since equity will not enforce positive obligations against successors, positive covenants are hard to enforce after a sale. The main route is the doctrine of mutual benefit and burden (Halsall v Brizell): a successor taking the benefit of a deed must accept the related burden, which must be relevant to the right (Rhone v Stephens).
Discharge and Reform
Restrictive covenants may be discharged by express release, by common ownership of both plots, or by declaration under s 84(2) LPA 1925; owners may apply to the Lands Chamber of the Upper Tribunal under s 84 to modify or discharge an obsolete restriction. The Law Commission has proposed replacing the system with “land obligations” allowing both positive and negative burdens to run as legal interests, though this is not yet implemented.