What Types of Private Agreements May Restrict the Use of My Property?

Property owners are, of course, accumstomed to government regulation of property ownership and use through zoning restrictions, building restrictions, public easements, property taxation, nuisance laws that prevent blight and keep private property owners from disturbing the peace of their neighbors, and a host of safety regulations put in place to protect the general public. Private agreements can also limit a property owner’s use of his or her property. For example, privately contracted covenants, conditions and restrictions may limit the use of real property. These are typically referred to as “CC&Rs” in the real estate world. Lot size, architectural design, landscaping choices, vehicle parking, security monitoring and patrol, and even placement of satellite dishes and allowable paint colors for exterior surfaces can be subject to the conditions set forth in a purchase contract. These types of restrictions are common in planned housing communities and condominium complexes. Some communities are less restrictive than others, but by and large, buyers should do their research thoroughly before agreeing to restrictions they may later regret.

Private easements and rights-of-way, too, may be established without government intervention. Grant, implication and prescription are all mechanisms for enabling others to use a portion of your real property. Remedies for violation of private party agreements can include awards of monetary damages against the violator and/or injunctive relief (requiring removal of the violation and prohibiting such a violation in the future).

Along with your rights connected to ownership of property come numerous responsibilities and potential liabilities. Some examples include:

(1) Mortgages – you may own property subject to a mortgage (if you fail to pay the mortgage, the lender will repossess the property);

(2) Liens – a lien for payment of a debt can be placed against your property (such as a “mechanic’s lien” or “judgment lien”); and

(3) Liability for Injury – if someone is injured on your property, you may be held liable for damages resulting from negligence or failure to maintain your property.

Case Studies: Private Agreements Restricting Property Use

Case Study 1: Community Covenants, Conditions, and Restrictions (CC&Rs)

John purchases a home in a planned housing community. After moving in, he decides to make certain modifications to his property, including adding a shed in his backyard. However, he soon learns that the community has CC&Rs in place that strictly regulate the appearance and use of properties within the community. The CC&Rs state that any external structures, such as sheds, must receive prior approval from the community’s architectural review board.

The CC&Rs serve as a private agreement that restricts John’s ability to make modifications to his property without approval. Since John did not seek approval before installing the shed, he is in violation of the CC&Rs. The community association may require him to remove the shed or face legal consequences. It is crucial for homeowners to thoroughly review and understand the CC&Rs before purchasing a property in a planned community.

Case Study 2: Private Easements and Rights-of-Way

Sarah owns a large piece of land that includes a small lake. Her neighbor, David, has been using a path that crosses Sarah’s property to access the lake for recreational purposes. However, there is no formal easement or right-of-way agreement in place allowing David to use the path. Even without government intervention, private parties can establish easements and rights-of-way through agreements.

In this case, David’s use of the path without a formal agreement could be seen as a trespass on Sarah’s property. Sarah may decide to take legal action to prevent David from using the path or seek compensation for the unauthorized use. Private easements and rights-of-way should be properly established and documented to avoid conflicts.

Case Study 3: Mortgage Liens and Property Liability

Lisa owns a residential property that is subject to a mortgage. Due to financial difficulties, Lisa falls behind on her mortgage payments, and the lender initiates foreclosure proceedings. Additionally, a visitor to Lisa’s property slips and falls on a damaged pathway, resulting in injuries. Lisa’s mortgage creates a private agreement between her and the lender, granting the lender the right to repossess the property in the event of default. As a result of her failure to pay the mortgage, Lisa may lose ownership of the property through foreclosure.