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Strawberry Fields Forever? Some Observations About Restrictive Covenants and Zoning

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Restrictive covenants and statutory land use controls are both capable of promoting private or public interests, but there is tension surrounding their use. Eran Kaplinsky explores the relationship between the two devices and discusses the courts’ evolving approach to resolving conflicts between restrictive covenants and restrictive land use controls that apply to the same property.

Image courtesy of interviewee. August 15, 2024

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This video is a transcript of a conversation about a study on restrictive covenants and their implications for land use, particularly in the context of zoning reforms in Canada and the United States. The discussion begins with the date and time of the recording before transitioning to an overview of restrictive covenants—legal agreements that dictate how land can be used—and the motivations behind studying them, particularly in light of recent municipal initiatives to increase housing density.

The conversation highlights how traditional low-density residential areas have typically been protected by zoning laws, which prevent alterations in land use, ensuring neighborhoods retain their character. However, growing pressures for increased housing supply and sustainability have led to reforms aimed at relaxing these restrictions, allowing for multi-family units and higher density developments.

This video details the significant role of covenants, which predate zoning laws, in maintaining neighborhood stability. Such covenants create binding agreements on land use that can affect redevelopment opportunities, with references to specific neighborhoods in Edmonton and Calgary where these covenants have restricted changes despite municipal efforts to increase density.

The discussion also covers the legal context, including recent court rulings in Calgary that may signal a shift towards allowing public planning regulations to take precedence over private covenants when they conflict with community interests.

The closing remarks emphasize the complex interplay between private covenants and public land use policies, suggesting that while both serve important functions, a decline in reliance on covenants could undermine private conservation efforts and future urban planning.

Overall, the text provides insight into the ongoing conflict between maintaining traditional residential character through restrictive covenants and the need for adaptive zoning to address housing challenges in rapidly growing cities.

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X-TIMESTAMP-MAP:LOCAL=00:00:00.000,MPEGTS=900000

00:00.115 --> 00:01.525
This article was inspired

00:01.705 --> 00:04.205
by several recent land use disputes

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that arose from municipal initiatives to increase densities

00:09.585 --> 00:12.765
in established residential areas in,

00:12.765 --> 00:13.925
many metropolitan areas.

00:14.065 --> 00:15.685
In, in Canada and the United States.

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Whole neighborhoods, and even entire suburbs,

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especially those built

00:20.615 --> 00:23.565
after Second World war, are reserved

00:23.565 --> 00:26.925
for so-called single family detached homes, meaning that

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only one dwelling unit designed

00:29.705 --> 00:33.965
to accommodate one household was built on each lot,

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those lots, often being quite large by,

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today's standards.

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And buyers overwhelmingly preferred

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to live in such neighborhoods if they could afford it.

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And local councils passed zoning bylaws

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that generally ensured that the character

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of these neighborhoods is for the most part, fixed.

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Um, meaning that a resident

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of a single family neighborhood could be reasonably sure

00:59.315 --> 01:02.885
that his or her neighbors could not put the, the,

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their property to a different use, say a business,

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or build an apartment building on the street.

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These low density patterns supported

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by local zoning bylaws have persisted for decades,

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but policymakers recently embarked on reforms

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that greatly relax existing land use restrictions,

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and some councils have rewritten their zoning codes

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to abolish single detached, zones altogether

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and several provinces and states.

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Um, Ontario

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and California being two examples passed, legislation

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that overrides local zoning codes

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and allows multiple dwelling units

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to be built on any land zone residential.

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And the City of Edmonton, changed its regulations

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to make it easier, to split,

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a large residential lot into two smaller parcels.

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There are two reasons for these zoning reforms.

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The first reason is that, relaxing land use restrictions

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increases the supply of developable land,

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which may improve housing affordability.

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And the second reason is

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that low density residential patterns,

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are widely regarded

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as less sustainable than compact less

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car dependent neighborhoods.

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Now, arguably the case for zoning reforms in Canada is not

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as strong as it is in the United States, chiefly

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because Canadian zoning codes are more permissive.

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In the United States, metropolitan areas are often made up

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of many small suburban municipalities where almost all

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of the land is zoned for single household

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detached on large lots.

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Whereas in Canada, cities are less fragmented

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and as much as one half of the land designated

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for housing is zoned multifamily.

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Nevertheless, Canadian

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Cities are quite busy rewriting their zoning codes,

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but there is a fly in the ointment,

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and that is the existence of a completely separate mode

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of regulating land use called restrictive covenants.

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And covenants predate zoning by half a century,

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and there are increasingly relied on by developers

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and homeowners who feel

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that zoning is no longer a dependable means of stabilizing,

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their neighborhoods.

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So what are covenants?

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Uh, covenants are essentially a special kind of land use

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contract, best explained, using an example, suppose

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that you want to purchase part of my land

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and I'm agreeable to selling,

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but I am worried that you will use, the property

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that you're buying for a purpose that I find objectionable.

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Uh, for example, a glue factory.

03:54.925 --> 03:58.105
So we stipulate in the sale agreement,

03:58.135 --> 03:59.505
that you promise not

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to use your new property for a glue factory.

04:02.965 --> 04:05.945
If I can't get that promise in writing, then I won't sell.

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And maybe it's you who are concerned about

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my use of my land.

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So you insist on the appropriate restrictions in the

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contract between us.

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The thing about contracts is

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that they're only binding on the parties who signed them.

04:25.915 --> 04:27.095
If you promised not

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to use your property in some prescribed manner

04:30.355 --> 04:33.615
and subsequently transferred your title to a new owner,

04:34.325 --> 04:37.255
that new owner would be free from any obligation

04:37.325 --> 04:40.215
that they did not personally undertake.

04:41.235 --> 04:43.655
But in the middle of the 19th century,

04:43.795 --> 04:46.255
the courts in England created a special

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exception to this rule.

04:48.875 --> 04:53.325
If you covenanted with your neighbor regarding the use

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of your land and the covenant,

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meaning the contractual promise met specific,

05:00.245 --> 05:02.645
requirements, which I will not go into here,

05:03.275 --> 05:07.005
then anyone taking title from me with notice

05:07.005 --> 05:09.365
of the covenant would be bound by it.

05:10.025 --> 05:13.565
And anyone taking title from my neighbor would be entitled

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to enforce the covenant.

05:15.345 --> 05:19.405
Now, we lawyers say that the covenant is now annex

05:19.825 --> 05:22.685
to the land in question, so that when you acquire the land,

05:22.825 --> 05:26.565
you also acquire the benefit or the burden of the covenant.

05:28.395 --> 05:32.775
Now, imagine a whole neighborhood governed by some sort

05:32.775 --> 05:35.095
of super covenant that consists

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of mutual restrictions undertaken by

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and for the benefit of all

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of the lands governed by the covenant.

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In Canada, those covenants are called building schemes.

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A building scheme may be enforced

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by any owner against any other owner,

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and they can only be changed by consensus of all

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of the property owners or

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by special proceedings in the courts.

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And before the advent of zoning, developers used covenants

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to fix the character of neighborhoods

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to suit homeowners preferences.

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And importantly because covenants are private arrangements,

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they're generally beyond the reach of local policymakers.

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Once zoning became acceptable, it replaced covenants

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as the go-to method of regulating land uses.

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But in Edmonton,

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and also, Calgary, these are,

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Alberta's two largest cities.

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And among the fastest growing in Canada,

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there are still several large scale building schemes.

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Uh, Edmonton's Glenora neighborhood, for example,

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is a residential area still governed by the,

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notorious caruthers caveat

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that was registered over 100 years ago.

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And that covenant was designed

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to protect the neighborhood's amenities

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and exclusive character.

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And it stipulates that no more than one, detached

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or semi-detached dwelling, may be built on any lot

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and it has to be set back at least 25 feet from the street.

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And the neighborhood's proximity

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to the center makes it attractive for redevelopment,

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but not withstanding Edmonton's efforts to allow it.

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The residents have been largely successful so far in suing

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to enforce the covenant and block redevelopment proposals.

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But it's not just the older covenants

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that impede municipal zoning reforms, initiatives

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to establish new covenant, covenants.

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Uh, were launched in some mature neighborhoods in Edmonton.

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I gave the, greater hardesty, example in my article,

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and that represents, residents response to some

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of the recent efforts to, bring in more density,

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bring in more mixed uses, et cetera.

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Um, and on top of that, we have developers who continue

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to register covenants in new neighborhoods.

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And one of the things that,

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struck me about the controversies surrounding residential

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covenants were, the sentiments of municipal officials,

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and Edmonton officials cautioned homeowners that

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entering enduring binding arrangements,

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could be detrimental to their long-term interest.

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It's better they said to trust the city's regulations

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to be more responsive and adaptable.

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But, Calgary, took a step farther.

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Uh, when a covenant from the 1950s stood in the way

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of the city's plans for densification

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of the Banff Trail neighborhood, the city applied

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to the court to have the covenant

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discharged in the view of local officials.

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There was room for only one set of regulations.

08:58.465 --> 09:00.325
The city's own Calgary

09:01.185 --> 09:05.525
relied on a rarely used provision in Alberta law,

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which authorizes the courts to modify

09:08.945 --> 09:11.565
or strike a covenant, which is found to conflict

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with local end use regulations if the court believes

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that the modification

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or discharge of the covenant is in the public interest.

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And the case, which is called house in Calgary from 2022,

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was significant because it was previously held

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that a covenant

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and zoning are in conflict, only if it is impossible

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to comply without, with one,

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without running a foul of the other.

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But because in Alberta, both covenants

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and zoning are restrictive in nature, that is they spell out

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what the owner cannot do with their land rather than

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what the owner must do with their land.

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Conflicts were thought to arise rarely, if ever.

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However, in this instance, the court was persuaded

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that there was indeed a conflict between the private

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and the public regulations as they pertain to a small number

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of, properties, and the court

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discharged the covenants against those properties.

10:09.105 --> 10:12.765
And that decision may signal a change in the court's

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attitude toward large scale covenants when those impede,

10:17.815 --> 10:19.005
local policies.

10:19.545 --> 10:21.485
Uh, there have been calls,

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by legal scholars in the US also, in, in view

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of the housing crisis there, at least in parts

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of the country that, covenants that restrict the supply

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of land should not be enforced as a matter of public policy.

10:36.505 --> 10:39.685
But there's also a strong argument to uphold covenants,

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which is that the parallel existence of private

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and public regulations provides opportunities

10:46.225 --> 10:49.165
for competing planning visions, planning ideals,

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and that it's necessary to decentralize planning authority.

10:54.265 --> 10:57.805
And there is one last argument against interfering

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with covenants, and that is the critical role

11:00.315 --> 11:03.205
that they play in private conservation arrangements.

11:03.595 --> 11:06.565
Imagine a farmer, who is set to retire,

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but would like to ensure that the land continues

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to be farmed rather than being redeveloped

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into, say, country homes.

11:14.385 --> 11:16.045
The farmer can sell

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or donate the development rights to a land trust,

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which is a,

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charitable non-profit organization dedicated to conservation.

11:24.705 --> 11:28.285
And the land trust will register a special,

11:28.565 --> 11:31.365
covenant called a conservation easement against the land,

11:32.125 --> 11:33.885
ensuring that the land shall never be used

11:33.945 --> 11:37.005
for any purpose other than agriculture.

11:37.905 --> 11:40.085
And similarly, a developer who volunteers

11:40.105 --> 11:44.045
to forego development opportunities in one location may be

11:44.045 --> 11:48.125
granted in exchange special development rights elsewhere,

11:48.545 --> 11:50.405
but only if the developer's end

11:50.405 --> 11:55.005
of the bargain can be guaranteed by a restrictive covenant.

11:55.425 --> 11:56.445
And these arrangements

11:56.505 --> 12:01.085
and similar initiatives would not be realized if we relied

12:01.085 --> 12:02.485
solely on zoning.

12:02.945 --> 12:05.125
Uh, the point that I'm making is

12:05.125 --> 12:08.405
that so-called private covenants can serve the public

12:08.765 --> 12:13.245
interest to sometimes more effectively than public

12:13.315 --> 12:14.525
land use controls.

12:15.305 --> 12:20.165
If legal reliance on covenants, is, continues

12:20.165 --> 12:21.165
to be undermined,

12:21.475 --> 12:25.765
then we can expect a decline in private conservation.

12:28.295 --> 12:33.195
So I, continue to be fascinated by the interplay

12:33.195 --> 12:36.195
between private and public land use regulations.

12:36.775 --> 12:39.995
Uh, I think both will determine what our cities look like

12:40.135 --> 12:42.155
and how we can protect our natural areas.

12:43.055 --> 12:47.075
And it will be interesting to see the developing attitudes

12:47.075 --> 12:48.675
of planners, elected officials

12:49.415 --> 12:52.515
and the courts, towards covenants in particular.

"Navigating Land Use Reforms: The Tension Between Zoning and Restrictive Covenants in Canadian and American Neighborhoods"

00:00:00 - This article was inspired by several recent land use disputes that arose from municipal initiatives to increase densities in established residential areas in, many metropolitan areas. In, in Canada and the United States. Whole neighborhoods, and even entire suburbs, especially those built after Second World war, are reserved for so-called single family detached homes, meaning that only one dwelling unit designed to accommodate one household was built on each lot, those lots, often being quite large by, today's standards. And buyers overwhelmingly preferred
00:00:44 - And local councils passed zoning bylaws that generally ensured that the character of these neighborhoods is for the most part, fixed. meaning that a resident of a single family neighborhood could be reasonably sure that his or her neighbors could not put the, the, their property to a different use, say a business, or build an apartment building on the street. These low density patterns supported by local zoning bylaws have persisted for decades, but policymakers recently embarked on reforms
00:01:24 - and some councils have rewritten their zoning codes to abolish single detached, zones altogether and several provinces and states. Ontario and California being two examples passed, legislation that overrides local zoning codes and allows multiple dwelling units to be built on any land zone residential. And the City of Edmonton, changed its regulations to make it easier, to split, a large residential lot into two smaller parcels. There are two reasons for these zoning reforms.
00:02:07 - increases the supply of developable land, which may improve housing affordability. And the second reason is that low density residential patterns, are widely regarded as less sustainable than compact less car dependent neighborhoods. Now, arguably the case for zoning reforms in Canada is not as strong as it is in the United States, chiefly because Canadian zoning codes are more permissive. In the United States, metropolitan areas are often made up of many small suburban municipalities where almost all of the land is zoned for single household
00:02:47 - Whereas in Canada, cities are less fragmented and as much as one half of the land designated for housing is zoned multifamily. Nevertheless, Canadian Cities are quite busy rewriting their zoning codes, but there is a fly in the ointment, and that is the existence of a completely separate mode of regulating land use called restrictive covenants. And covenants predate zoning by half a century, and there are increasingly relied on by developers and homeowners who feel that zoning is no longer a dependable means of stabilizing,
00:03:29 - So what are covenants? covenants are essentially a special kind of land use contract, best explained, using an example, suppose that you want to purchase part of my land and I'm agreeable to selling, but I am worried that you will use, the property that you're buying for a purpose that I find objectionable. for example, a glue factory. So we stipulate in the sale agreement, that you promise not to use your new property for a glue factory. If I can't get that promise in writing, then I won't sell.

"Understanding Covenants: The Binding Nature of Land Use Agreements and Their Impact on Neighborhood Dynamics"

00:04:10 - my use of my land. So you insist on the appropriate restrictions in the contract between us. The thing about contracts is that they're only binding on the parties who signed them. If you promised not to use your property in some prescribed manner and subsequently transferred your title to a new owner, that new owner would be free from any obligation that they did not personally undertake. But in the middle of the 19th century, the courts in England created a special exception to this rule.
00:04:53 - of your land and the covenant, meaning the contractual promise met specific, requirements, which I will not go into here, then anyone taking title from me with notice of the covenant would be bound by it. And anyone taking title from my neighbor would be entitled to enforce the covenant. Now, we lawyers say that the covenant is now annex to the land in question, so that when you acquire the land, you also acquire the benefit or the burden of the covenant. Now, imagine a whole neighborhood governed by some sort
00:05:35 - of mutual restrictions undertaken by and for the benefit of all of the lands governed by the covenant. In Canada, those covenants are called building schemes. A building scheme may be enforced by any owner against any other owner, and they can only be changed by consensus of all of the property owners or by special proceedings in the courts. And before the advent of zoning, developers used covenants to fix the character of neighborhoods to suit homeowners preferences. And importantly because covenants are private arrangements,
00:06:19 - Once zoning became acceptable, it replaced covenants as the go-to method of regulating land uses. But in Edmonton, and also, Calgary, these are, Alberta's two largest cities. And among the fastest growing in Canada, there are still several large scale building schemes. Edmonton's Glenora neighborhood, for example, is a residential area still governed by the, notorious caruthers caveat that was registered over 100 years ago. And that covenant was designed to protect the neighborhood's amenities and exclusive character.
00:07:00 - or semi-detached dwelling, may be built on any lot and it has to be set back at least 25 feet from the street. And the neighborhood's proximity to the center makes it attractive for redevelopment, but not withstanding Edmonton's efforts to allow it. The residents have been largely successful so far in suing to enforce the covenant and block redevelopment proposals. But it's not just the older covenants that impede municipal zoning reforms, initiatives to establish new covenant, covenants.
00:07:40 - I gave the, greater hardesty, example in my article, and that represents, residents response to some of the recent efforts to, bring in more density, bring in more mixed uses, et cetera. and on top of that, we have developers who continue to register covenants in new neighborhoods. And one of the things that, struck me about the controversies surrounding residential covenants were, the sentiments of municipal officials,

"Balancing Public Interests and Private Covenants in Urban Development"

00:08:21 - entering enduring binding arrangements, could be detrimental to their long-term interest. It's better they said to trust the city's regulations to be more responsive and adaptable. But, Calgary, took a step farther. when a covenant from the 1950s stood in the way of the city's plans for densification of the Banff Trail neighborhood, the city applied to the court to have the covenant discharged in the view of local officials. There was room for only one set of regulations.
00:09:01 - relied on a rarely used provision in Alberta law, which authorizes the courts to modify or strike a covenant, which is found to conflict with local end use regulations if the court believes that the modification or discharge of the covenant is in the public interest. And the case, which is called house in Calgary from 2022, was significant because it was previously held that a covenant and zoning are in conflict, only if it is impossible to comply without, with one, without running a foul of the other. But because in Alberta, both covenants
00:09:43 - what the owner cannot do with their land rather than what the owner must do with their land. Conflicts were thought to arise rarely, if ever. However, in this instance, the court was persuaded that there was indeed a conflict between the private and the public regulations as they pertain to a small number of, properties, and the court discharged the covenants against those properties. And that decision may signal a change in the court's attitude toward large scale covenants when those impede, local policies. there have been calls,
00:10:25 - of the housing crisis there, at least in parts of the country that, covenants that restrict the supply of land should not be enforced as a matter of public policy. But there's also a strong argument to uphold covenants, which is that the parallel existence of private and public regulations provides opportunities for competing planning visions, planning ideals, and that it's necessary to decentralize planning authority. And there is one last argument against interfering with covenants, and that is the critical role that they play in private conservation arrangements.
00:11:06 - but would like to ensure that the land continues to be farmed rather than being redeveloped into, say, country homes. The farmer can sell or donate the development rights to a land trust, which is a, charitable non-profit organization dedicated to conservation. And the land trust will register a special, covenant called a conservation easement against the land, ensuring that the land shall never be used for any purpose other than agriculture. And similarly, a developer who volunteers to forego development opportunities in one location may be
00:11:48 - but only if the developer's end of the bargain can be guaranteed by a restrictive covenant. And these arrangements and similar initiatives would not be realized if we relied solely on zoning. the point that I'm making is that so-called private covenants can serve the public interest to sometimes more effectively than public land use controls. If legal reliance on covenants, is, continues to be undermined, then we can expect a decline in private conservation.

"Navigating the Balance: The Role of Private and Public Land Use Regulations in Shaping Urban Landscapes and Conservation"

00:12:49 - between private and public land use regulations. I think both will determine what our cities look like and how we can protect our natural areas. And it will be interesting to see the developing attitudes of planners, elected officials and the courts, towards covenants in particular.

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