Investigation of title - Easements and restrictive covenants

Learning Outcomes

This article examines the legal principles governing easements and restrictive covenants in property transactions, focusing on title investigation, routes to creation and enforceability, and practical impact for buyers and lenders. It discusses the distinction between legal and equitable rights and their protection by registration or notice, identifies when easements may override registered dispositions, and reviews options for restrictive covenants that obstruct proposed use or development, including release, modification, and indemnity insurance, with SQE1-oriented focus areas throughout.

SQE1 Syllabus

For SQE1, you are required to understand the investigation of title as it relates to easements and restrictive covenants, with a focus on the following syllabus points:

• The legal characteristics and types of easements and restrictive covenants
• How easements and restrictive covenants are created, protected, and enforced
• How to identify and advise on these interests when investigating title to registered and unregistered land
• The impact of these interests on buyers, sellers, and lenders in property transactions
• Differences between legal and equitable interests and their protection mechanisms (registered notices and Land Charges)
• When easements override registered dispositions under the Land Registration Act 2002
• Class D(ii) and Class D(iii) land charges and the consequence of non-registration in unregistered land
• Methods to deal with onerous covenants (release, s.84 LPA 1925 applications, and indemnity insurance) and the constraints on using insurance

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. What are the four essential characteristics of a legal easement?
2. How can a restrictive covenant be enforced against a subsequent owner of the burdened land?
3. What is the effect of failing to register a post-1925 restrictive covenant as a land charge in unregistered land?
4. Name two ways in which an easement can be created without an express deed.
5. True or false? A positive covenant will automatically bind successors in title to the burdened land.

Introduction

When acting for a buyer or lender, you must investigate title to identify any rights or restrictions affecting the property. Two of the most common are easements (rights over land) and restrictive covenants (obligations restricting land use). These interests can significantly affect the value, use, or marketability of land. For SQE1, you must be able to identify, explain, and advise on the creation, enforceability, and practical impact of easements and restrictive covenants, bearing in mind the different rules on protection in registered and unregistered land. It is essential to distinguish between legal and equitable rights, to know when registration or notice is mandatory, to appreciate which easements may override registered dispositions, and to understand practical options where title issues jeopardise intended dealings or financing.

Easements

An easement is a right enjoyed by one landowner over the land of another, such as a right of way or a right to run services.

Key Term: easement
A right benefiting one parcel of land (the dominant tenement) over another (the servient tenement), such as a right of way or to run pipes.

Essential characteristics

A valid easement must have all of the following:

• There must be a dominant and a servient tenement (two separate parcels of land)
• The easement must benefit the dominant land (not just a personal advantage)
• The dominant and servient tenements must be owned by different persons
• The right must be capable of being granted by deed (i.e., sufficiently certain and not too vague)

Key Term: dominant tenement
The land that benefits from the easement.

Key Term: servient tenement
The land over which the easement is exercised and which is burdened by it.

The requirement that the right is “capable of grant” means it must be sufficiently definite, fit within the general nature of rights recognised as easements, and not amount to conferring exclusive possession of the servient land. Classic guidance comes from Re Ellenborough Park: a right must accommodate the dominant land, be capable of forming the subject matter of a grant, and not amount to a purely personal advantage. A “right to a view”, for example, is too vague; a right to light through defined apertures is capable of being an easement.

Key Term: Re Ellenborough Park (test)
Authority supporting the essential characteristics of easements: the right must benefit land, be capable of grant, and not confer exclusive possession.

Creation of easements

Easements can arise in several ways:

• Express grant or reservation: Created by deed, usually on a sale of part of land. For a legal easement the grant or reservation must be by deed and for a term equivalent to an estate in fee simple or a term of years.

• Implied grant or reservation: Arises automatically in certain circumstances, such as necessity (e.g., landlocked land), common intention (to enable the intended use), or under the rule in Wheeldon v Burrows and/or statutory operation of s.62 Law of Property Act 1925.

Key Term: Wheeldon v Burrows
On a disposition of part, quasi-easements that are continuous, apparent, and necessary for the reasonable enjoyment of the part conveyed may pass as implied grants unless excluded.

Key Term: s.62 LPA 1925
Statutory word-saving provision which can convert licences and privileges into easements on conveyance, and pass existing appurtenant rights, often operating where there has been prior diversity of occupation.

• Prescription: Acquired by long use (at least 20 years) as of right (without force, without secrecy, and without permission: nec vi, nec clam, nec precario). There are three methods: common law prescription, “lost modern grant”, and under the Prescription Act 1832 (with specific rules for rights of light).

Key Term: prescription
Acquisition of a legal easement by long, uninterrupted use (usually 20 years), without force, secrecy, or permission.

Key Term: lost modern grant
A legal fiction whereby 20 years’ continuous use as of right is treated as evidence of a (lost) grant of the easement.

In practice:

• Implied grants include easements of necessity (strict), intended easements to enable the contemplated use (e.g., ventilation ducts for a restaurant), and ancillary easements reasonably necessary for the effective enjoyment of the grant.
• s.62 can operate broadly but typically requires prior diversity of occupation and a conveyance; Wheeldon v Burrows is confined to implied grants (not implied reservations).
• For rights of light, 20 years’ enjoyment under the Prescription Act can establish the right unless the enjoyment was by written consent.

Protection and enforceability

Protection depends on whether land is registered or unregistered and whether the easement is legal or equitable.

• In registered land:
  • An express grant or reservation of an easement over registered land is a registrable disposition. To take effect at law it must be completed by registration against the servient title. If not completed by registration, it will take effect only in equity and must be protected by a notice to bind a purchaser for value.
  • Implied or prescriptive legal easements can be overriding interests if, on a registrable disposition, they are:
    • known to the buyer, or
    • obvious on a reasonably careful inspection, or
    • exercised within one year before the disposition.

Key Term: overriding interest (Sch 3 LRA 2002)
Certain interests (including some legal easements) bind a buyer despite not appearing on the register if statutory criteria are met (e.g., obvious on inspection).

• Express easements created after first registration are not capable of overriding status; they must be completed by registration to be legal and should be protected by notice if equitable.

Key Term: notice (registered land)
An entry on the charges register of the servient title protecting a third-party interest (agreed or unilateral). Without notice, many equitable interests will not bind a purchaser for value.

• In unregistered land:
  • Legal easements bind all purchasers automatically.
  • Equitable easements must be registered as a land charge (Class D(iii)) to bind a purchaser for money or money’s worth. If not registered, they are void against a purchaser for value.

Key Term: Class D(iii) land charge
Registration category in unregistered land for equitable easements; non-registration renders the easement void against a purchaser for money or money’s worth.

For registered titles, always review the charges register of the servient title to see if the burden of an express or noted equitable easement is protected, and the property register of the dominant title to see the benefit recorded. In unregistered titles, check the deed creating the easement and ensure appropriate land charges searches by name and period.

Termination of easements

Easements may end by:

• Express release (usually by deed)
• Unified ownership and possession (merger of seisin) of the dominant and servient land
• Abandonment (requires clear evidence of intention to abandon; mere non-use is insufficient)
• Expiry (if granted for a fixed term)
• Statute (e.g., compulsory purchase or highway extinguishment)

Special points:

• Some rights benefiting a lease may survive merger of the lease into the freehold where the right was intended to benefit the land and remains appurtenant.

Worked Example 1.1

A owns Blackacre and sells part to B, granting B a right of way over A’s retained land. The right is not registered on A’s title. Is the right of way enforceable against a future purchaser of A’s land?

Answer:
If the titles are registered and the easement was created by express grant over registered land, it is a registrable disposition. It only takes effect at law if completed by registration against the servient title. If not registered, it is merely equitable and will bind a purchaser for value only if protected by a notice; it cannot rely on overriding status (which for easements is confined to certain implied or prescriptive rights). In unregistered land, a legal easement created by deed binds successors automatically; an equitable easement must be registered as a Class D(iii) land charge to bind a purchaser for value.

Restrictive covenants

A restrictive covenant is an obligation restricting the use of land for the benefit of another’s land, such as a promise not to build more than one house.

Key Term: restrictive covenant
A promise by one landowner (the covenantor) not to do something on their land, for the benefit of another landowner (the covenantee).

Creation and requirements

• Must be negative in substance (i.e., restricts activity, not requiring expenditure)
• Must benefit identifiable land owned by the covenantee
• Must be intended to run with the land (intention can be express or implied by statute)
• In unregistered land, must be registered as a Class D(ii) land charge to bind a purchaser for value
• In registered land, must be protected by an entry on the charges register

Key Term: covenantor
The person who gives the promise and whose land is burdened.

Key Term: covenantee
The person who takes the benefit of the promise and whose land is benefited.

Key Term: annexation (benefit of a covenant)
The process by which the benefit of a covenant is attached to and runs with the benefited land, either expressly or by s.78 LPA 1925.

Key Term: Class D(ii) land charge
Registration category for restrictive covenants affecting unregistered land; non-registration renders the burden unenforceable against a purchaser for money or money’s worth.

A well-drafted covenant will identify the benefited land and make clear that the burden is intended to run with every part of the burdened land, and the benefit with every part of the benefitted land. The benefit may later be shown to run by annexation, assignment, or building scheme principles.

Key Term: building scheme
A scheme of mutually enforceable covenants on an estate where purchasers can enforce restrictions against each other if strict criteria are satisfied.

Enforcement

• The original covenantee can always enforce the covenant against the original covenantor (privity of contract).
• Successors in title can enforce restrictive covenants in equity if the requirements above are met.
• The burden of a restrictive covenant does not pass at law but may pass in equity under the rule in Tulk v Moxhay.

Key Term: Tulk v Moxhay
The leading case establishing that a restrictive covenant can be enforced in equity against successors in title who have notice of the covenant.

For enforcement in equity against successors:

• The covenant is restrictive
• The covenantee owned land capable of benefit at the time of the covenant
• The parties intended the burden to run with the land
• The purchaser of the burdened land took with notice of the covenant:
  • In registered land, by an entry on the register (a notice)
  • In unregistered land, by registration as a land charge (Class D(ii)) or actual/constructive notice for pre-1926 covenants

The benefit must be shown to pass to a successor by annexation, express assignment, or building scheme.

Positive covenants do not normally bind successors. Workarounds include a chain of indemnity covenants, a rentcharge with right of re-entry, granting leasehold structures, or applying the “benefit and burden” principle in limited circumstances.

Key Term: Halsall v Brizell (benefit and burden)
A person cannot take a benefit (e.g., use of a private road) without accepting a correlating burden (e.g., contributing to its maintenance), where the two are relevantly linked.

Modification and discharge

A restrictive covenant may be modified or discharged by:

• Express release by the person with the benefit (or all persons entitled to enforce)
• Application to the Upper Tribunal (Lands Chamber) under s.84 Law of Property Act 1925 (e.g., if obsolete, impedes reasonable use, or no substantial value/advantage persists; compensation may be payable)
• Indemnity insurance (if enforcement risk is low and no approach has been made to a person with the benefit)

Key Term: s.84 LPA 1925
Statutory route to seek modification or discharge of restrictive covenants on specified grounds via the Upper Tribunal (Lands Chamber).

Worked Example 1.2

C buys land subject to a restrictive covenant (registered as a land charge) not to build more than one dwelling. C wants to build two houses. What are C’s options?

Answer:
C could seek a release or relaxation from the person(s) with the benefit (if they can be identified), apply to the Upper Tribunal to modify or discharge the covenant under s.84 LPA 1925, or consider restrictive covenant indemnity insurance if the covenant is old and the risk of enforcement is low. Any approach to the beneficiary will usually invalidate cover under an indemnity policy, so the order of steps must be managed carefully. If C builds in breach without resolving the covenant, enforcement action could be taken, potentially including an injunction or damages.

Exam Warning

If a restrictive covenant is not registered as a land charge in unregistered land, it will not bind a purchaser for value. Always check registration status when advising.

Investigating title for easements and restrictive covenants

When acting for a buyer or lender, you must:

1. Review the official copies (registered land) or epitome of title (unregistered land) for references to easements and covenants.

   • Registered land: scrutinise the property register (benefits such as rights of way, service media), charges register (burdens: restrictive covenants, easements granted out, rentcharges), and any filed documents or plans referred to in the register for full terms and routes. Confirm that any express easements created post-registration have been completed by registration against the servient title.
   • Unregistered land: read the operative parts of conveyances for express grants and reservations (usually near the start of the deed) and any schedules for covenants. Note any declarations as to rights of light or air.

2. Check the charges register for entries relating to easements or restrictive covenants.

   • Express post-2003 easements over registered servient land must be completed by registration to be legal; otherwise protect as equitable by notice to bind purchasers.
   • For restrictive covenants, confirm the relevant deed and plan are available and the benefiting land (if identified). Check that wording supports annexation of the benefit.

3. In unregistered land, ensure land charges searches are made against all relevant names for the correct periods.

   • Search all estate owners’ names for Class D(ii) (restrictive covenants) and Class D(iii) (equitable easements). Remember that registration is by name and county, and spelling variations matter.
   • Ensure the search spans from acquisition to disposal dates for each owner, with 1926 as the earliest default if uncertain.

4. Raise pre-contract enquiries and inspect the property for evidence of rights or breaches.

   • Enquiries should cover disputes regarding rights of way, notices received, contributions demanded or paid for private roads and services, and any alleged or historic breaches of covenant.
   • Physical inspection may reveal use consistent with a prescriptive easement (e.g., a well-trodden track) or potential breaches of restrictive covenants (e.g., business signage where use is restricted).
   • Consider transaction-specific searches (e.g., highways search to confirm adoption status; if a “ransom strip” exists, rights of access may rely on private easements).

5. Advise on the impact of any rights or restrictions found, including enforceability, risk, and possible solutions (e.g., release, modification, insurance).

   • Consider whether benefits are adequate (e.g., vehicular access “at all times and for all purposes” if needed; rights to services including repair and replacement rights).
   • Assess whether burdens are enforceable (e.g., in registered land, is there a notice protecting a restrictive covenant? In unregistered land, was a post‑1925 covenant properly registered as a Class D(ii)?).
   • Where positive obligations appear (e.g., to contribute to a private roadway), evaluate whether the obligation is secured (e.g., via benefit-and-burden linkage) and whether the buyer’s intended use depends on the associated benefit.

Key Term: declarations of light and air
Provisions often reserving to a transferor the freedom to build on retained land, precluding any rights of light/air accruing over it; these limit future rights claims by the transferee.

Key Term: indemnity insurance (title)
An insurance policy to protect against loss if an interest is enforced or claimed; cover typically requires that no contact has been made with a potential enforcing party and may exclude deliberate future breaches.

Worked Example 1.3

You act for a buyer of a registered freehold property. The charges register refers to a right of way in favour of a neighbour and a restrictive covenant prohibiting business use. The buyer wants to run a business from home. What should you advise?

Answer:
The right of way benefits the neighbour and burdens your client’s land—ensure its route and scope (including any maintenance contributions) are acceptable. The business-use restriction is enforceable if protected by notice (and likely enforceable if benefitting adjoining residential land even if older), and running a business could breach it. Options are to seek a release/consent from the beneficiary, apply under s.84 LPA 1925 for modification (success depends on grounds and may be time-consuming), or consider indemnity insurance if risk appears low and no approach has been made. Confirm whether the intended “home business” is minor enough not to amount to business use in breach on proper construction; if not, advise that proceeding risks injunction/damages and may prejudice any mortgage.

Revision Tip

When investigating title, always check both the property and charges registers for references to easements and covenants. In unregistered land, check all relevant names and periods in land charges searches. Distinguish clearly between:

• express easements post‑registration (which must be completed by registration to be legal)
• implied/prescriptive easements (which may override if statutory tests are met)
• restrictive covenants requiring notice (registered land) or Class D(ii) registration (unregistered land).

Key Point Checklist

This article has covered the following key knowledge points:

• Easements are rights benefiting one parcel of land over another, with strict legal characteristics and limits (must benefit land, be definite, and not confer exclusive possession).
• Easements can be created by express grant/reservation (by deed), implication (necessity, common intention, Wheeldon v Burrows, s.62 LPA 1925), or prescription (as of right for 20+ years), and the creation route affects protection requirements.
• In registered land, express easements post‑registration must be completed by registration to be legal; implied/prescriptive legal easements may override registered dispositions if statutory conditions are satisfied.
• In unregistered land, legal easements bind automatically; equitable easements must be registered as a Class D(iii) land charge to bind a purchaser for value.
• Restrictive covenants are negative obligations restricting land use for the benefit of identified land; the burden runs in equity (Tulk v Moxhay) where requirements are met and the purchaser takes with notice.
• The benefit of restrictive covenants may pass by annexation, assignment, or building scheme; the burden never runs at law but can run in equity if properly protected (notice or land charge).
• Positive covenants do not automatically bind successors; consider chains of indemnity, rentcharges with rights of re-entry, leasehold structures, or the narrow benefit-and-burden principle (Halsall v Brizell) where a benefit is claimed.
• Onerous restrictive covenants can sometimes be released, modified under s.84 LPA 1925, or mitigated by indemnity insurance (noting the need to avoid contacting potential enforcing parties before insuring).
• Investigation of title requires careful review of registers or deeds, appropriate land charges searches, targeted enquiries, and a site-aware approach to spotting unregistered rights and breaches.
• Lenders generally require good and marketable title; unresolved easement and covenant issues can delay or derail funding.

Key Terms and Concepts

• easement
• dominant tenement
• servient tenement
• Re Ellenborough Park (test)
• Wheeldon v Burrows
• s.62 LPA 1925
• prescription
• lost modern grant
• overriding interest (Sch 3 LRA 2002)
• notice (registered land)
• Class D(ii) land charge
• Class D(iii) land charge
• restrictive covenant
• covenantor
• covenantee
• annexation (benefit of a covenant)
• building scheme
• Halsall v Brizell (benefit and burden)
• Tulk v Moxhay
• s.84 LPA 1925
• declarations of light and air
• indemnity insurance (title)