Equitable Servitudes In Texas

In Texas real estate, there is a doctrine of law known as equitable servitude that is sometimes used by courts to restrict certain uses of land. Texas courts have referred to equitable servitudes as “implied reciprocal negative easements” and “implied equitable servitudes.” Equitable servitudes are similar to restrictive covenants, which we address in a separate article.

In this article, we will give a brief overview of restrictive covenants and then compare equitable servitudes and restrictive covenants to provide an understanding of how Texas courts apply the doctrine of equitable servitude. If you have questions about enforcement of an equitable servitude, contact Austin real estate attorney Farren Sheehan for an initial consultation.

Elements Of A Restrictive Covenant

Because equitable servitudes are so similar to restrictive covenants, a good place to start is to first briefly describe restrictive covenants. Then, we will be able to better explain the differences between equitable servitudes and restrictive covenants.

Under Texas property law, a restrictive covenant is a contractual promise not to do something on a piece of land. There are several elements for a restrictive covenant to be enforceable in Texas:

• It must be in writing (i.e. in the deed).
• The intent of the original parties must have been for the covenant to run with the land (i.e. the successors would be bound by the terms).
• The covenant must touch and concern the land.
• There must be horizontal privity.
• There must be vertical privity or privity of estate.
• Finally, notice must have been given to subsequent purchasers of the covenant.

For more explanation on what each of these elements involves, please review our article on Restrictive Covenants in Texas.

Definition Of An Equitable Servitude

As stated above, equitable servitudes are referred by Texas courts as “implied reciprocal negative easements” or “implied equitable servitudes.” The actual definition of an equitable servitude is:

“A restriction on the use of land enforceable in court of equity. It is broader than a covenant running with the land because it is an interest in land.”

An equitable servitude is not written in the property deed but is implied by virtue of the larger plan and is enforceable in court as equity.

Differences Between Restrictive Covenants And Equitable Servitudes

Both restrictive covenants and equitable servitudes are promises that restrict the use of real property and bind the owner of the property and his successors. Equitable servitudes are broader than restrictive covenants because they do not have to be included in the written deed and are enforceable in court as equity.

The two primary requirements that must be met for the equitable servitude doctrine to save an otherwise unenforceable restrictive covenant are:

• A general plan or scheme for development must exist; and
• Subsequent purchasers must acquire their property with notice (either actual notice or constructive notice) of the covenant or servitude.

One large difference between restrictive covenants and equitable servitudes is in the relief granted. The relief for violations of restrictive covenants is monetary damages, whereas the relief for equitable servitude is enforcement through equity, usually by an injunction for specific performance. In other words, harm due to a violation of a restrictive covenant is usually resolved by an award of monetary damages to the aggrieved party. If a situation meets the requirements for equitable servitude, on the other hand, the parties affected can bring an injunction against the violator who is preventing the use of the property in the manner that is in accordance with the general plan.

Example Of An Equitable Servitude

The application of equitable servitude occurs often in the Austin, Cedar Park, and Round Rock areas. As an example, say a developer subdivides a large tract of real property into residential lots and sells an initial wave of 50 lots with restrictive covenants stated in the deeds in accordance with the general development plan for the entire subdivision. The restrictive covenants expressly provide that the lots are for single-family homes. However, the developer keeps 10 of the lots out of the initial sale, and sells them later without the express restrictive covenant of single-family residence written in the deeds. In this example, the 10 later-sold lots are not burdened by covenants running with the land via restrictive covenants. Nevertheless, if one of the owners of the later-sold 10 lots wants to build a four-unit apartment complex in the subdivision, the courts will likely still enforce the single-family restriction as an implied equitable servitude, as there was a common plan for the entire subdivision. Thus, the 10 lots that were sold later may not be used in violation of the same restrictive covenants that expressly burden the lots sold with the written restrictions.

Sheehan Law, PLLC | Experienced Texas Real Estate Attorneys

For answers to your real estate questions, including those related to equitable servitude, please do not hesitate to contact the attorneys at Sheehan Law, PLLC. You can reach us by phone at (512) 355-0155 to set up a consultation, or fill out our online contact form with your questions and we will be in contact.