In urban settings, restrictive covenants are utilized to order the development of lots in a particular fashion. The covenants typically “run with the land” and bind current and subsequent owners to the restrictions placed on title ownership to the property. Common restrictions are those that specify the design and location of property improvements and structures, setback requirements, garaging of vehicles and the type of animals that may be allowed on the property, if any. The idea is to maintain property values by prohibiting unsightly structures or bothersome animals, for example. But, can the restrictions go on forever? Under Iowa law, the answer is “no.” Restrictive covenants are good for up to 21 years from the time they are recorded on the land records, but they can be extended for another 21 years if a claim to extend them is filed with the county recorder’s office during the initial 21-year term.
In this case, a developer (the plaintiff in this case) filed a set of restrictive covenants for a development on March 26, 1980, with the county recorder. On March 22, 2001, an officer of the developer filed a claim with the recorder to continue the covenants for another 21 years. In late 2002, the defendant submitted plans to the homeowner’s association for a house he wanted to build. When he didn’t get a response in nine days (including a holiday and weekend), he began construction. The homeowner’s association then objected to the building plans as being in violation of the restrictive covenants and demanded that the defendant cease construction. The defendant, however, continued to build, and the developer sued for an injunction that would stop the building project. The trial court ruled for the defendant.
At issue in the case was the Iowa Stale Uses and Reversions Act (Iowa Code §614.24). It’s a law that has been on the books since the mid-1960s and is intended to simplify land transfers by shortening the title-search period. But, the statute does allow use restrictions to be continued by interested persons upon proper filing of a claim. According to the appellate court the claim must set forth the nature of the interest (whether it is a reversionary, reverted or use restriction interest), the manner the interest was acquired (by identifying the deed, conveyance, contract or will) and the time the deed, conveyance or contract was recorded (or probated if acquired by will). Because the developer’s claim satisfied those requirements, the restrictive covenants were properly extended. That’s bad news for the defendant whose building project was put on hold. The lesson of the case - pay close attention to restrictive covenants in deeds.Fjords North, Inc. v. Hahn, 710 N.W.2d 731 (Iowa 2006).