77A covenant is distinguished from an interest in land and is rather a restriction, limitation or requirement imposed on real property.
Unless the covenant is contrary to law, a covenant created by: (a) inclusion in an instrument of conveyance; or (b) in a separate instrument; is valid and in effect unless the covenant expired by its terms or was released of record.
The release of a covenant may be affected by an instrument executed by: (a) a specified number or percentage of the holders of the beneficial rights pursuant to the terms of the instrument that creates the covenant; or (b) in the absence of a specified number or percentage of the holders, all the holders of the beneficial rights pursuant to the terms of the instrument that creates the covenant.
Comment 1. A covenant shall be presumed to run with the land if the covenant: (a) touches and concerns the land; (b) is intended by the party imposing the covenant to run with the land; (c) is imposed in a written instrument; and (d) there is privity between the party imposing the covenant and the party against whom the covenant is to be enforced. See, e.g. Gardner v. Jefferys, 178 VT. 594 (2005) (citations omitted).
Comment 2. A covenant that is clear and unambiguous is given effect according to its terms. If a covenant is determined to be ambiguous and open to one or more reasonable interpretation, the intent of the original parties077 and circumstances of the creation of the covenant shall be considered. See e.g. Creed v. Clogston, 2004 VT 34.
Comment 3. A covenant is distinguished from a condition subsequent or a fee determinable by the remedy. A covenant is enforced by court action to restrict or require the action specified in the covenant, whereas a condition gives rise to a right of reentry and a fee determinable result in reversion of the title when the triggering event occurs. Collette v. Town of Charlotte, 114 Vt 357 (1946) See also, 27 V.S.A. §604 (a)(5).
Comment 4. The question whether Covenants are or are not subject to expiration under the terms of the Marketable Record Title Act has not been resolved.
Comment 5. The statute of limitations applied to violation of a covenant, contained in a deed of lands, other than the covenants of warranty and seisin, is 8 years. 12 V.S.A. §505.
Comment 6. 24 V.S.A. §545 restricts the creation of covenants that have the effect of prohibiting development authorized by 24 VSA §4412 (1)(E) for small lots and (2)(A) accessory apartments.
Comment 7. 24 V.S.A. §546 will void covenants that restrict access to housing based on race, ethnicity, or religion.
September 2022: Standard and comments added.