Key Practice Areas
Covenants - What Are They?
Monday, February 25, 2019
A covenant is a voluntary agreement that imposes restrictions on what a person can do or cannot do on a parcel of land. A covenant is usually imposed to preserve the amenity of the land either for the benefit of the person selling the land or for neighbouring properties.
There are two main forms of covenant:
The Land Title Act allows the registration of certain covenants which in the main:
- Relate to the use land or a part of land.
- Relate to the use of a building or part of a building.
- Deal with the preservation of native animals or plants.
Examples of covenants that deal with the use of the land or building include the use of part of the land for noise attenuation purposes or that the land/building must be used for a particular purpose such as educational purposes or a particular commercial purpose.
Covenants that cannot be the subject of a registered covenant include compliance with architectural, construction or landscaping standards or compliance with requirements for the conduct of the owner. These issues must be addressed in other ways (see below).
Registered covenants may be imposed as a condition in certain development approvals.
Buyers purchasing a block of land in a residential estate are likely to find that the contract contains developer or building covenants. These generally impose conditions or restrictions on what can be constructed on the land.
Examples will include height restrictions, building envelopes, the type of materials or fencing that is allowed.
This type of covenant is an enforceable agreement between the developer and the buyer. The covenant will generally include a provision that when the buyer sells the land then he/she must obtain a deed of covenant from his/her buyer in favour of the developer in which the new buyer agrees to perform the developer or building covenants.
Both forms of covenant achieve certain objectives for freehold flat land developments. Where there is a strata title development then the bylaws within the community management statement can deal with many of these objectives.
This is a general overview of covenants and specific legal advice is recommended for each particular circumstance.