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by Richard R. Hammar, J.D., LL.M., CPA

Restrictive Covenants

§ 7.13
Key point 7-13. A restrictive covenant is a restriction on the use of property. Such restrictions often are noted in deeds to property, but they may appear in other documents as well. Such restrictions apply to a church's use of its property.

A restrictive covenant is a restriction on the use of property. Often, such covenants appear in deeds. Property owners, including churches, are legally bound by such restrictions. As a result, it is important for church leaders to review the deed to their property to be sure they are familiar with any such restrictions. However, as the following examples illustrate, such restrictions are not always legally enforceable.

Case studies
  • A Missouri court ruled that a restrictive covenant contained in the deed to church property prevented a church from building a parking lot. The church owned and occupied several lots within a subdivision. Church leaders wanted to construct parking lots on three of the lots it owned. A homeowners' association sought a court order permanently enjoining the church from building parking lots on its property. The association claimed that the building of parking lots would violate a 1917 restrictive covenant covering each lot in the subdivision. The covenant specified that "none of said lots shall be improved, used nor occupied for other than private residence purposes." The court found conceded that restrictive covenants are "regarded unfavorably and are strictly construed because the law favors the free and untrammeled use of real property." Nevertheless, restrictive covenants "will be enforced where the intention is clear." The court rejected the church's argument that the restrictive covenant could be ignored as a result of "changed circumstances." To establish changed conditions warranting non-enforcement of a restrictive covenant, "the burden rests on the defendant to prove: (1) the radical change in condition; (2) that as a result enforcement of the restrictions will work undue hardship on him; (3) and will be of no substantial benefit to the plaintiff." The court acknowledged that "no hard and fast rule can be laid down as to when changed conditions have defeated the purpose of restrictions, but it can be safely asserted the changes must be so radical as practically to destroy the essential objects and purposes of the agreement." The court disagreed that "changed circumstances" warranted non-enforcement of the covenant.[218] Country Club Homes v. Country Club Christian Church, (Mo. App. 2003). See also Fitzwilliam v. Wesley United Methodist Church, 882 S.W.2d 343 (Mo. App. W.D. 1994).

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