Property
Class Notes
Moseley v.
Bishop
Moseley
owns some farmland. Bohn does too. There was an easement for a drainage ditch to
go across Bohn’s property from Moseley’s property. Moseley’s property goes to one of his descendents. Bohn sells to Gates and others. Gates has the portion of the farm with the
pipeline running through it. So what was
the covenant here? They put some tiles
into the drain. The drain was on Bohn’s property,
and Bohn agreed to maintain the drain tiles.
Moseley gave him some money in consideration. So Bohn will permanently maintain the drain tile so that Moseley’s land will
drain properly. But his successors
failed to maintain the tiles.
Did
this covenant “touch and concern” the land?
Yes! It related directly to the use of the land. “Drain tile” is like pipe! Was there vertical privity of estate? Yes there is!
How come? You’re in vertical
privity if you own the same property that one of the covenanters held. What about horizontal privity of estate? The court says that it’s mutual privity of
estate in that they are covenanting with respect to property for which they both own an easement. The court holds that there is horizontal privity of estate.
Then
there is a long footnote. What is it all
about? There is some debate whether
horizontal privity should be required.
Horizontal privity of estate is frequently said to be a “roadblock” that
courts put up that don’t really fulfill any useful purpose. The court says that they doubt whether the
requirement of horizontal privity of estate is useful anymore.
Why
not enforce this as an equitable servitude?
Equitable servitudes must be done in
equity. In this case, the plaintiff
is looking for money damages, not an injunction. The Moseleys had to
pay the farm bureau to clean out the tile, and they want Gates and others to
pay a share of the cost. If they were
trying for enforcement in equity, they wouldn’t have to show horizontal privity
of estate. Therefore, the issue here is
whether the covenant runs at law. This is probably the only remaining
distinction between a real covenant and an equitable servitude: the
remedy. In fact, there may be no
difference.
Who
is liable here? It looks like only Gates
is on the hook. The “touch and concern”
requirement is said to not be met by owners other than Gates. The original ditch only went across Gates’s land! But if
the servient estate is one parcel and then becomes subdivided, aren’t all the
parcels still part of the servient estate?
Braunstein finds this perplexing.
“Touch and concern” is just a metaphor.
The court doesn’t really tell us anything except the fact that the pipe
doesn’t physically touch the
residential owners’ land. Braunstein sees
how it can be fair that only the farmer
has to take care of the ditch and the residential owners don’t have to, but how
can you justify this as a matter of law?
Problems on horizontal
privity
“Two
neighbors who each promise to contribute half to the maintenance of a common
sewer line that both use”: This is mutual because they both own an interest in
the sewer line, or at least the land through which it runs. That’s mutual.
“A
purchaser of a lot in a subdivision who accepts a deed which includes a promise
to use the land only for residential purposes”: This is successive, because it’s
made at the same time that property is transferred.
“Two
neighbors who each agree to use their land only for residential purposes”: The
two neighbors don’t own anything in common.
They also didn’t sell anything to each other. They’re also not landlord and tenant. There’s no horizontal privity of estate!
“A
person who buys a lot from his neighbor and promises not to build within 20
feet of the property line of the neighbor who sells him the lot”: Here, it’s
successive because there’s a purchase and sale of property and there’s a
promise at the same time as the sale.
Touch and concern
At
least for real covenants, and maybe also for equitable servitudes, both the
benefit and the burden must concern the land.
That means that all real covenants are appurtenant to land. You can’t have a real covenant in gross. You may be able to have an equitable
servitude in gross.
Things
are going to affect value if the law enforces them! If it is enforced, it will change the value
of the land. Value is determined by law
and by what the law recognizes as property rights. You can’t use increases and decreases in
value as your guide in trying to decide whether to enforce these agreements. Some people argue that we should get away
from this touch and concern requirement altogether and talk more explicitly
about policy.
Whitinsville
Plaza, Inc. v. Kotseas
Does
this case shed any light on the touch and concern requirement? It’s not difficult factually. A real estate developer enters into a
covenant restricting the use of the land.
Then he wants to lease the land to someone who will break the covenant,
because that’s going to make him a lot of money. The people benefited by the covenant sue to
block the lease. The court lays out the
standard analysis of real covenants and horizontal privity of estate. Here, the
What
is the horizontal privity of estate here?
How does the court find out that it exists? There are mutual easements running across the
land, and the court says that’s enough to satisfy the requirement. They look at the decision of Oliver Wendell
Holmes written long ago. What’s wrong
with Norcross? It says that non-competition clauses don’t “touch
and concern” land. This court says that
they do touch and concern land. This makes the same criticism of Holmes that
we made of
The
court also says that you must recognize the historical context of Norcross. Courts were just starting to recognize real
covenants and equitable servitudes, and the courts were cautious about allowing
too many of them. They had a concern
that the alienability of land would be reduced because the land would be tied
up with all these promises. The court
overrules Norcross, saying that reasonable
covenants against competition may run with the land when they help facilitate “orderly
and harmonious” development for commercial use.
But what if the covenant is just to keep out discount stores? These anti-competition covenants are valid if
they serve that purpose. The court says
that they won’t enforce boilerplate provisions.
These covenants must be tailored to some specific need related to the
development of the property. Now we know
most of the answer, but there are a lot of creative people out there thinking
up things that the courts haven’t considered.
If
you compare this to Willard or the
Policy restrictions on
servitudes
You
can’t have racially restrictive covenants in this country anymore, but they
were very common up to the 50’s and 60’s.
Some of these covenants are still on the deed, but they won’t be
enforced anymore. Shelly v. Kraemer said
that for a court to enforce a real covenant with a racial restriction was unconstitutional
under the Fourteenth Amendment because it involves state action. In order to
violate the Constitution, there must be something done by the state or federal government or an instrumentality of the government. The courts are an instrumentality of the
state, according to this holding. The
only case that has expanded Shelly is
an