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restrictive covenant

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restrictive covenant

In property law, an agreement acknowledged in a deed or lease that restricts the free use or occupancy of property, such as by forbidding commercial use or certain types of structures. The restrictive covenant is as old as the law of property, being well-established in Roman law. The term is also used in business law to refer to an agreement whereby one party promises not to engage in the same business or a similar business in a particular area for a period of time.


restrictive covenant
An agreement between two or more individuals, incorporated within a deed which stipulates how land may be used. The constraints may include: the specific use to which a property can be put, the location and dimensions of fences, the setback of buildings from the street, the size of yards, the type of architecture, the cost of the house, etc. Racial and religious restrictions on inhabitants are legally unenforceable.


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A restrictive covenant offends public policy as a restraint of trade and therefore will be prima facie void from the beginning unless a court concludes that it is reasonable as between the parties.
[ILLUSTRATION OMITTED] Caption: Clifton Budd & DeMaria's Daniel Moreland (left) and Matthew Siebel hosted a special presentation on Drafting and Enforcing Restrictive Covenants at Yale Club on Vanderbilt Avenue.
The five-year franchise contained a restrictive covenant which made clear that Mr Kerr would not engage in any business which competed with ChipsAway's own presence in that area without ChipsAway's written consent for 12 months after the franchise ended.
 
 
 
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