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Subject: Covenants and the Courts
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RoyalP
(South Carolina)

Posts:203


12/03/2018 6:45 PM  
COVENANTS AND THE COURTS

This case contained a discussion about what a covenant is and how the courts interpret them. While this is a case from NC, I have seen similar thoughts expressed in cases from other states. The text reads:

The word covenant means a binding agreement or compact benefiting both covenanting parties. Covenants accompanying the purchase of real property are contracts which create private incorporeal rights, meaning non-possessory rights held by the seller, a third-party, or a group of people, to use or limit the use of the purchased property. Judicial enforcement of a covenant will occur as it would in an action for enforcement of any other valid contractual relationship. Thus, judicial enforcement of a restrictive covenant is appropriate at the summary judgment stage unless a material issue of fact exists as to the validity of the contract, the effect of the covenant on the unimpaired enjoyment of the estate, or the existence of a provision that is contrary to the public interest.

“While the intentions of the parties to restrictive covenants ordinarily control the construction of the covenants, such covenants are not favored by the law, and they will be strictly construed to the end that all ambiguities will be resolved in favor of the unrestrained use of land. The rule of strict construction is grounded in sound considerations of public policy: It is in the best interests of society that the free and unrestricted use and enjoyment of land be encouraged to its fullest extent.

The law looks with disfavor upon covenants restricting the free use of property. As a consequence, the law declares that nothing can be read into a restrictive covenant enlarging its meaning beyond what its language plainly and unmistakably imports.

Covenants restricting the use of property are to be strictly construed against limitation on use, and will not be enforced unless clear and unambiguous. This is in accord with general principles of contract law, that the terms of a contract must be sufficiently definite that a court can enforce them. Accordingly, courts will not enforce restrictive covenants that are so vague that they do not provide guidance to the court.Unless the covenants set out a specialized meaning, the language of a restrictive covenant is interpreted by using its ordinary meaning.

“Wein II, LLC v. Porter, 198 N.C.App. 472, 479–80, 683 S.E.2d 707, 712–13 (2009) (emphasis added) (citations, quotation marks, ellipses, and brackets omitted).”
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