What are Covenant and Easements? 

Understanding covenants and easements and how they affect a property is an important part of any property transaction. Any covenants or easements that may exist over the land must be identified and investigated, since they may affect your proposed use and development of the property.

What is a covenant?

Contract between original two parties, usually the initial Developer of Land and the original Owner of the Land. A Covenant is a promise where a description outlines the restriction on Land use. It is a notation on Title linked to the original agreement For example: the building materials on houses in certain subdivision are to be selected from a list of materials contained in the covenant agreement on Title. 

There are two types of covenants, which affect properties in different ways:

1. Restrictive covenants:  Generally, restrictive covenants control the permissible use of land, which mean the owner of the land is refrained from doing something.  For example, a developer may impose a covenant requiring land in a subdivision to be used only for residential purposes, requiring any building to be of a specified quality or value, or placing limits on design (such as a prohibition against double garages).

Restrictive Covenants might be used in circumstances such as:-

• Not allowing a house to be used for business purposes.
• Not allowing non domestic animals to be kept on the property e.g. Chickens, pigs etc.
• Not allowing building on land without consent of the party who has the benefit of the covenant.

2. Positive covenants: A positive covenant requires some form of action to be taken e.g. to erect a fence along a boundary. Positive covenants are generally a contract between the original parties to the deed imposing the covenant and do not bind future land owners. However, future owners of the land which has the benefit of a positive covenant can enforce the covenant against the original owner of the land that has the burden of the covenant.

The impact of a covenant on a property

Covenants are common in situations where land is subdivided as part of a housing development. Developers may want to establish construction standards in the covenant, such as the minimum size of a dwelling or limiting the type of materials used for the construction of the dwelling, with the objective of maintaining the aesthetics and quality of housing.

A covenant may also be created in favour of a prescribed authority, such as a local council. These prescribed authorities impose covenants on their own land and on the land of third parties and can also impose terms or conditions for the performance of such obligations.

If you plan to build a house on vacant land or substantially renovate an existing house, it is important to review any covenants which may exist over the land to ensure your development plans comply with the obligations imposed under the covenants.

What is an easement?

Restriction on the user of the land, to benefit another party, registered on the Title e.g. a Driveway is owned by the front street facing home, an easement registered on title allows the back neighbour to use the driveway for entrance, even though owned by the front street owner. 

Examples of easements include:

• Right of way (also known as a right of carriageway) – This allows a neighbour or statutory authority the right to travel or pass through a defined portion of the land. An example of a right of way easement is a shared driveway used by a landlocked owner to access their property.
  
• Easement for services – This allows a statutory authority to repair and maintain services located on the property. These services may run over the property (e.g. overhead electricity transmission lines) or underneath the property (e.g. sewerage pipes).
  
• Cross-easements – This allows neighbouring properties with reciprocal rights to use each other’s property for the same purpose. The most common example of a cross-easement is a shared party wall between neighbouring terrace houses.

• Easement by Prescription – Created informally by years of usage but not registered on Title, created by a common law and facts of the situation. (usually by Court Action). 

• Easement by abandonment – Created by non-use, non-use was intentional and no longer needed, application to Court or NSWLRS. 

• Profits a prende – The right for someone to enter someone’s land and remove fruit, soil, timber, crops etc. must be disclosed in Contract for Vendor Disclosure if registered on Title. 

The impact of an easement on a property

Easements can restrict your use of the land. If your property has an easement which allows access for your neighbour or a statutory authority, they are not considered to be trespassing provided they are using the easement in the prescribed manner and you cannot interfere with their rights or restrict access to the easement.

An easement will also affect any proposed development on the property. You are generally not allowed to build any structures on or over an easement unless you have authority from the party which benefits from the easement. Owners who build any structures on or over an easement without obtaining approval may be required to remove the structure.

At Gondwana Lawyers Pty Ltd, our experienced conveyancing solicitors, can assist owners of property and prospective purchasers of property with the following:

• Drafting and preparing covenant or easement documents to register on title;
• Reviewing and advising on your rights and obligations if there is a covenant and or easement on your property;
• Advising on options available in dealing with an easement or covenant.

𝗧𝗼 𝗹𝗲𝗮𝗿𝗻 𝗺𝗼𝗿𝗲, 𝗴𝗶𝘃𝗲 𝘂𝘀 𝗮 𝗰𝗮𝗹𝗹 𝗼𝗻 𝟬𝟰𝟱𝟭 𝟰𝟬𝟬 𝟲𝟬𝟭 𝗼𝗿 𝗰𝗼𝗻𝘁𝗮𝗰𝘁 𝘂𝘀 𝘃𝗶𝗮 𝗷𝗮𝘀𝗽𝗿𝗲𝗲𝘁@𝗴𝗼𝗻𝗱𝘄𝗮𝗻𝗮𝗹𝗮𝘄𝘆𝗲𝗿𝘀.𝗰𝗼𝗺.𝗮𝘂 𝘁𝗼 𝘀𝗰𝗵𝗲𝗱𝘂𝗹𝗲 𝗮 𝗰𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝘁𝗶𝗼𝗻 𝘁𝗼𝗱𝗮𝘆