Introduction
As identified by the Law Commission, one of the key problems with the law of freehold covenants is that ‘whereas the benefit of a positive covenant can run at law, the burden of a positive covenant does not run so as to bind successors in title’.
Despite the fact that this principle is one of the relatively comprehensible principles of the contemporary land law, in this particular case it requires additional analysis. In particular, the purpose of this research is to analyze the second part of this statement, to identify the main issues emanating from it, focusing on the burden of positive covenants. The second part of this research is to provide a comprehensive critical analysis of the set of reforms offered by the Law Commission, which are supposed to help in solving this problem.
Analysis of the Principle
A positive (sometimes referred to as “affirmative”) covenant refers to the contractual promise to take some actions, the scope of which has been previously agreed by the parties. Within the purview of the UK land law, this concept refers to the actions, which a legitimate user of this land should take in order to stay compliant with the covenant’s provisions. The most popular examples of such actions include building a fence, repairing a shared roof or making a financial contribution to cover the costs of maintaining a shared driveway.
At the same time, in accordance with the principle described above, not all land-related covenants are automatically binding upon the successive owners of such land, when it changes the owners. Specifically, the practice demonstrates that different positive/affirmative covenants do not go ‘together’ with the land. However, it is important emphasizing that the original contracting party remains bound by its provisions. In other words, while the plot of land has been completely alienated and no legal connection between the past owner and the property is present, yet, this past owner remains bound by the law to complete the activities prescribed by the ‘positive covenant’. The practice demonstrates that neither the past owner, nor the new one are usually interested in this state of post-sale regulation.
Because of these provisions, it is obvious that the contemporary state of land law development in the United Kingdom may not necessarily reflect the interests and the intents of the parties, for whom it is often necessary to transfer the positive covenant together with the property in question. As a result of this, the practice developed certain methods of circumventing this legal doctrine. For instance, the new owner may conclude the new deed of covenant with the beneficiary. In the cases when this mechanism is non-available for some reasons, the courts may use one of the methods to ensure that the duties imposed upon the parties by the positive covenant provision in fact do run with the land. The court practice resulted in the development of a doctrinal principle, that a party may not accept the bargain benefits without accepting the burdens of this bargain simultaneously.
Analysis of the Law Commission’s Reforms
Considering seriousness of the problem associated with the positive covenants in land law, the Law Commission took a rather unorthodox approach to dealing with it. Specifically, the Law Commission highlights that the key problematic issue in this area of the land law is that establishing the identity of a person who is legally entitled to make filing a lawsuit on the covenant may be particularly difficult, because the land tends to change owners, as well as it becomes fragmented over time.
As the primary method of dealing with this problem, the Law Commission offers to introduce the new interest in land and to have it registered accordingly. Specifically, it is argued that the newly registered land obligation would functions similarly to the idea of easement. Because both the benefits and the burdens will be accurately registered, there will be no difficulty in establishing those, who are responsible for complying with the contractual duties, and thus, should any breach occur, the parties to a potential lawsuit become easily identifiable.
Registering the ‘burden’ separately from the land appears to be an effective strategy for solving the problem, although some difficulties may arise in the future. Assuming that everyone complies with his/her positive covenant duties in a ‘good faith’ way, no problems are expected to occur in the future. At the same time, those parties, who decide to default on the obligations, may effectively abscond accountability by proving that there is no adequate consideration for their performance, i.e. it is always legally possible to register the title and the ‘positive covenant’ obligations on the different persons. To be more specific, a buyer may agree with a third party, that this third party will assume the ‘positive covenant’ obligations, while in the future it may default on its obligations. By stating that this third party has no interest in the deal, it can successfully litigate that non-complying with the terms of the ‘positive covenant’ obligations is legally permissible.
Bibliography
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The Law Commission, Making Land Work: Easements, Covenants and Profits a Prendre, (Law Com No 327, 2011)
