Covenants, Conditions, Restrictions (CC&R's)

A covenant is a promise to either do, or refrain from doing, a specific act or activity with respect to a specific parcel of land. In the event the promise is broken, the normal remedy of the person entitled to the performance is to institute an action to recover damages occasioned by the breach, or to enjoin a continuation of the breach.

Condition
A condition is a qualification imposed in a conveyance making the transfer of a title contingent upon the performance or non-performance of a specific act or activity in relation to the land. The performance, or lack of performance, can have a very definite effect on the title transfer. Conditions are either one of the following types:

1. Condition precedent: A condition in a conveyance is “precedent” when performance of the specific act or activity is required before the conveyance can occur.
2. Condition subsequent: A condition in a conveyance is “subsequent” when the conveyance is subject to the power of the grantor to terminate in the event of nonperformance of the specified act or activity.

Common Methods of Creating Real Property Restrictions:
The creation of restrictions on land use can be accomplished in a variety of ways, including the following:

1. Covenants included on the deed to a single parcel.
2. Covenants included in an agreement between two or more owners of lands, usually in the same neighborhood.
3. Conditions imposed by a deed on a single parcel
4. Covenants and/or conditions included in the deeds from a tract (subdivision or project) owner conveying individual lots, with the intention of establishing a general plan of tract restrictions enforceable by and binding all owners in the tract.
5. Incorporating a “Declaration of Establishment of Restrictions” (Declaration of Covenant, Conditions, and Restrictions) by reference to the subsequent deeds.
6. Establishing ordinances or resolutions of municipalities and governmental agencies.

Termination of Restrictions
Restrictions on land use may terminate by any of the following:

1. Voluntary cancellation by all parties concerned.
2. Restrictions within an instrument providing for automatic termination on a given date; however, within five years of such date, such restrictions should be considered enforceable as to any violation occurring prior to the expiration date.
3. By merger into a single ownership of the land burdened by the restriction.
4. By recording a “quitclaim” deed from the grantor (or heirs or assigns) whenever the language in the deed indicates that the restrictions were imposed only for the benefit of the subject property.
5. By recording a “quitclaim” deed from all the property owners in the tract (those for whom the restrictions were to benefit) whenever the language in the deed indicates that the restrictions were imposed for the benefit of other lots in the tract or owners thereof.
6. By order of the court in situation where, due to a change in circumstances, it would be inequitable to enforce said restrictions.

Declaration of Restriction
A Declaration of Covenants, Conditions and Restrictions (CC&R’s) is recorded for new subdivisions and becomes an integral part of each and every deed issued within the subdivision in order to establish uniform and beneficial restrictions as to the use, occupancy, developmental character, cost and location of structures to be built on the lots within the subdivision. These restrictions are normally referred to as general plan restrictions and are enforceable (by the property owners in the tract) through normal court actions such as injunctions, and damage suits. In extreme situations, the law allows forfeiture or reversion of the title.

Legality of Restrictions
Owners, selling land, may impose such restrictions on land usage as they so choose, providing said restrictions are not unlawful or contrary to public policy or prior recorded restrictions that have not terminated. Examples of restriction which seem to be invalid or unenforceable are as follows:

1. Those impossible of performance
2. Those requiring the commission of unlawful acts or involving unlawful use of land.
3. Those deemed unreasonable or capricious
4. Those restricting use, occupancy or alienability by reason of race, color, religion, or national origin

Special note: Title insurers are not required to act as judge and jury as to the enforceability of restrictions. When restrictions fall into the categories of invalid or unenforceable, title insurers may add an endorsement to the policy.

Courtesy of Fidelity National Title Company