2 Philips 774, 41 End. Rep. 1143 (Court of Chancery,
England 1848)
Tulk owned a vacant lot and some nearby houses in Leicester Square in London. He sold the vacant lot to a guy named Elm.
The sales contract specified that Elm, and all heirs and
assignees, would maintain the vacant lot as a 'pleasure garden', and
charge admission.
This sort of requirement is now known as a covenant.
The deed to the pleasure garden passed by divers mesne
conveyances into the hands of Moxhay.
Divers mesne means "various
intervening", aka it changed hands a bunch of times and we're not
going to bother to explain all the details.
The deed Moxhay bought said nothing about maintaining the
land as a garden.
Moxhay admitted that he did know about the covenant.
Moxhay decided that since he owned the land, he could
build whatever he wanted on it. Tulk sued in order to get an injunction,
and force Moxhay to abide by the terms of the original agreement he made
with Elm.
The English Court granted the injunction.
The English Court felt that since the price of a parcel
of land is affected by a covenant in the sales contract, it would
be inequitable for that covenant to not run with the land.
Otherwise the buyer could turn around and resell the land the very next
day to someone else at a greater price with no covenant.
There are two categories of covenants:
Negative covenants are an agreement not to
do something
For example, not to build a house on the property.
Affirmative covenants are an agreement to
do something.
For example, to maintain a garden.
In general, courts (in England anyway) have held that negative
covenants are assignable and run with the land, while affirmative
covenants are not assignable and do not run with the land.
In the US, affirmative covenants are sometimes
enforceable as equitable servitudes.
