Positive Covenants and Successors in Title

The decision in Churston Golf Club Ltd v Haddock [2019] EWCA Civ 544

Property lawyers will have been relieved by the Court of Appeal’s decision in Churston Golf Club Ltd v Haddock (2019) which determined that a fencing obligation in a conveyance was not an easement but a positive covenant and, therefore it could not bind successors in title.

In this case, Mr Haddock brought proceedings against the tenant of Churston Golf Club, adjacent to his farm. He claimed that there had been a breach of a covenant in a 1972 conveyance of the golf club land to “maintain and forever after keep in good repair…stock proof boundary fences or hedges along with such parts of the land… as are marked T inwards on the plan.”

Birss J agreed with Mr Haddock and determined that a fencing easement was created. As a result, the golf club owners were bound by this obligation even though they were not a party to the 1972 conveyance. It is long established that the burden of positive covenants cannot directly run with the land and therefore bind successors in title. However, this decision if it had stood would have an example of the Court trying to give effect to the original parties intention by characterising a positive covenant as a fencing covenant so that it binds successors in title.

The golf club appealed the decision on the basis that the obligation was simply a positive covenant and not a fencing easement and therefore it could not be enforced by the successors to the original parties. The Court of Appeal agreed with this analysis and determined that the golf club owners were not bound by the obligation and therefore were under no obligation to maintain the fence.

Property lawyers need to be alert to the fact that when creating a positive obligation which they intend should bind successors in title, appropriate wording needs to be included in the transfer to allow this.

FAQS

Is a purchaser a successor in title?

Yes, a purchase is a successor in title as long as they are buying the same interest in the property. For instance, if Mr Smith sold the freehold interest in his house to Mr Jones, then Mr Jones would be Mr Smith’s successor in title. But if Mr Smith granted a 99 year lease of his home to Mr Jones, then Mr Jones would not be a successor; he would be a tenant. A successor in title does not have to be a purchaser. It could also include an heir, liquidator, executor, trustee in bankruptcy or anyone who takes legal ownership of the property.

Can positive covenants be enforced?

Generally, you can pass the burden of positive covenants to new owners by putting some additional legal mechanisms in place. There are various ways of doing this. The most common way is for your solicitor to include language in the transfer confirming that the new owner will perform the positive covenant and will not sell the property unless they obtain a similar promise from the next purchaser.

What does successor in title mean?

A successor in title is anyone who takes over the legal ownership of a property from someone else. If Mr Smith sold his house to Mr Jones, then Mr Jones would be Mr Smith’s successor in title. If Mr Jones then sold the home to Mrs Brown, Mrs Brown would be a successor in title to both Mr Jones and Mr Smith. In theory, this chain of succession could go on forever.

Is a purchaser a successor in title?

Yes, a purchase is a successor in title as long as they are buying the same interest in the property. For instance, if Mr Smith sold the freehold interest in his house to Mr Jones, then Mr Jones would be Mr Smith’s successor in title. But if Mr Smith granted a 99 year lease of his home to Mr Jones, then Mr Jones would not be a successor; he would be a tenant.

A successor in title does not have to be a purchaser. It could also include an heir, liquidator, executor, trustee in bankruptcy or anyone who takes legal ownership of the property.

Can positive covenants be enforced?

Positive covenants can be enforced against:

• The person who originally gave the positive covenant, and
• A successor in title who has legally agreed to perform the positive covenant

Things get tricky when a property has changed hands many times, and you cannot be certain whether every single owner in the chain has signed an obligation to perform the positive covenant. In most cases, you won’t be able to force a successor in title to perform the covenant either, as you’ll only be able to obtain damages, not specific performance.

Covenant issues can be rather complicated, so it’s a good idea to take advice from a solicitor before doing anything to change the ownership of property.