P & A Swift Investments v Combined English Stores [1989] AC 632

Key point
  • This case defined the meaning of the requirement that covenants much ‘touch and concern’ the benefiting land
Facts
  • D acted as surety to an underlease (guaranteeing payment of rent)
  • The interest in reversion was assigned by the landlord to C
  • C claimed for unpaid rent against D
  • D argued that the C did not have the benefit of the leasehold covenant to pay rent
Held (House of Lord)
  • Claim succeeded; the benefit of the leasehold covenant to pay rent had passed to C
Lord Oliver of Aylmerton

A covenant touches and concerns the land where it:

  1. ‘benefits only the reversioner [landlord] for the time being’,
  2. ‘affects the nature, quality, mode of user or value of the land’, and
  3. ‘is not expressed to be personal, that is to say neither being given only to a specific reversioner [landlord] nor in respect of the obligations only of a specific tenant’

Current case

  • Payment of rent satisfied the conditions and thus touched and concerned the land
  • The covenant to pay rent is the major cause of the landlord’s reversion having any value during the continuance of the term
Commentary
  • Although this case concerned a leasehold covenant, the definition of touch and concern has been applied to freehold covenants as well
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