Tulk v Moxhay [1848] 2 Ph 774

Facts

• Tulk owned land in Leicester Square, London, and sold a parcel to Elms, subject to a covenant requiring Elms, his heirs, and assigns to maintain the land as an open garden and not build on it.
• This covenant benefited Tulk's surrounding properties by maintaining the character of the area.
• The land changed hands multiple times, eventually being acquired by Moxhay.
• Moxhay had actual notice of the restrictive covenant before purchasing the land.
• Despite his awareness, Moxhay intended to build on the land.
• Tulk sought an injunction to restrain Moxhay from breaching the covenant.

Issues

1. Whether a restrictive covenant can bind a subsequent purchaser who was not a party to the original agreement at common law.
2. Whether equity can enforce a restrictive covenant against a purchaser who acquires land with notice of the covenant.
3. Whether the requirement of notice (actual or constructive) is sufficient to render a purchaser bound by the covenant.

Decision

• The Court of Chancery, led by Lord Cottenham LC, granted an injunction preventing Moxhay from building on the land.
• The court held that a purchaser with notice is bound in equity by restrictive covenants affecting the land, even if such covenants do not bind in common law.
• It was reasoned that failing to bind purchasers with notice would enable evasion of restrictions and render covenants ineffective.
• The principle was confined to restrictive (not positive) covenants, as later clarified by subsequent cases.

Legal Principles

• Restrictive covenants may be enforced in equity against subsequent purchasers with actual or constructive notice, even if not enforceable at common law.
• At common law, only parties to the original agreement are bound, and certain technical requirements are needed for covenants to run with land.
• Equity intervenes to prevent unfairness and unjust enrichment where a purchaser takes land with knowledge of an existing covenant.
• The doctrine does not extend to positive covenants, as confirmed in later cases such as Haywood v Brunswick Permanent Benefit Building Society (1881) 8 QBD 403.
• With modern land registration systems, registration rather than notice primarily determines binding effect of such covenants, especially under the Land Registration Act 2002.

Conclusion

Tulk v Moxhay established that restrictive covenants may bind subsequent purchasers in equity if they have notice of the covenant, marking a significant departure from strict common law requirements and reinforcing equity’s role in maintaining the integrity of land-use agreements. The rule is limited to restrictive covenants, and its centrality has diminished with statutory land registration, but it remains a key doctrinal reference in property law.