Rhone v Stephens [1994] 2 All ER 65 (HL)

Facts

• The case concerned a property originally consisting of a house and adjoining cottage under a single roof.
• The owner, G, sold the cottage but retained the house. In the conveyance, G covenanted for themselves and successors in title to maintain the part of the roof covering the cottage.
• Over time, both properties changed ownership. R, who acquired the cottage, sued B, representing the current estate holding the house, alleging roof disrepair and asserting B’s obligation to repair under the original covenant.
• The initial court ruled for R. The Court of Appeal reversed the decision.
• The matter reached the House of Lords to determine if B, as successor in title, was bound by the covenant to maintain the roof.

Issues

1. Does the burden of a positive covenant to maintain property pass to successors in title to freehold land?
2. Did section 79 of the Law of Property Act 1925 alter the common law rule regarding positive covenants?
3. Can the benefit and burden principle be applied to enforce the maintenance obligation in this context?
4. What are the limitations of applying the benefit and burden doctrine to covenants affecting land?

Decision

• The House of Lords held that the burden of a positive covenant does not run with freehold land and cannot bind successors in title.
• Section 79 of the Law of Property Act 1925 was found not to alter the basic common law position; it is only a word-saving provision, not enabling positive covenants to run.
• The benefit and burden principle was not applicable, as there was no directly reciprocal benefit offered to B which could justify imposing the burden.
• Policy concerns were cited regarding uncertainty and the potential imposition of unagreed obligations on successors.
• The earlier precedent in Austerberry v Corporation of Oldham was reaffirmed, and the application of the decision was clarified by reference to later cases such as Thamesmead Town Ltd v Allotey.

Legal Principles

• Positive covenants—requiring a party actively to perform an obligation—do not bind successors in title to freehold land; the doctrine of privity of contract prevails.
• Section 79 of the Law of Property Act 1925 does not enable positive covenants to run with the land; it merely operates as a word-saving device.
• The benefit and burden doctrine requires a direct reciprocity between benefit and burden, with the successor having a choice to forgo the benefit and thus avoid the burden.
• Restrictive covenants may run with the land in equity under different principles, but positive covenants remain unenforceable against successors except in leasehold contexts or when a strict application of benefit and burden applies.

Conclusion

Rhone v Stephens [1994] 2 All ER 65 (HL) confirms that, in relation to freehold land, the burden of positive covenants does not run with the land to bind successors in title, maintaining the principle of privity of contract and clearly delimiting the scope of the benefit and burden doctrine.