Ontario Easements and Restrictive Covenants: A Complete Guide

What Is an Easement?

An easement is a right to use another person's land for a specific purpose. The land that benefits is the dominant tenement; the land that is burdened is the servient tenement. Common examples in Ontario practice include:

• Rights of way (access across a neighbouring parcel)
• Utility easements (hydro, gas, water, sewer — often held by municipalities or utility corporations)
• Drainage easements
• Easements for light and air (rare and difficult to establish in Ontario)
• Parking easements
• Conservation easements registered under the Conservation Land Act

Easements are interests in land — they are proprietary rights that bind successors in title (unlike a licence, which is merely personal and revocable). On Land Titles land, easements must be registered to bind a purchaser for value without notice. On Registry Act land, constructive notice may arise from visible use or adjacent title documents.

The Four Requirements: Re Ellenborough Park

The leading statement of easement requirements is Re Ellenborough Park [1956] Ch 131 (CA), adopted throughout Canada including Ontario. To qualify as a valid easement, four conditions must be satisfied:

How Easements Are Created

Express Easements

Express easements are granted by deed or reserved in a conveyance. Under the Land Titles Act R.S.O. 1990, c. L.5, an express easement must be registered on the servient title to bind a purchaser for value. A grant of fee simple in a parcel can simultaneously reserve an easement in favour of the grantor's retained lands — care must be taken with the language to ensure the reservation is clear (reservation contra proferentem interpreted against grantor at common law; courts now use general purposive approach).

Implied Easements

Implied easements arise without express words, based on surrounding circumstances:

• Easements of necessity — A landlocked parcel receives an implied right of access from the grantor's retained land when no other access exists (Nickerson v Barraclough [1981] Ch 426; confirmed in Ontario — true necessity required, inconvenience insufficient).
• Wheeldon v Burrows — On a grant (not a reservation), all continuous and apparent quasi-easements and reasonably necessary quasi-easements pass to the grantee if previously used by the common owner.
• General words under s.15 CLPA — The Conveyancing and Law of Property Act general words clause implies certain rights unless expressly excluded.
• Intended easements — Courts imply easements necessary to give effect to the parties' common intentions at the time of grant (Liverpool City Council v Irwin[1977] AC 239).

Prescriptive Easements

Prescriptive easements in Ontario arise under the Real Property Limitations ActR.S.O. 1990, c. L.15 after 20 years of continuous, open, peaceful, and uninterrupted use as of right — nec vi, nec clam, nec precario (not by force, not secretly, not by permission):

• Open — use visible and known (or ought to be known) to the servient owner
• Continuous — consistent with the nature of the right (seasonal use may qualify for seasonal rights); interrupted use breaks the period
• As of right / claim of right — permission destroys a prescriptive claim (Warrant v LLSC Ltd 2011 ONCA 432); a single permission granted and accepted resets the clock
• Without interruption — acquiescence in obstructions for one year ends the prescriptive period

Benefit and Burden Running with Land

For an easement to be useful, both the benefit (right to use the servient land) and the burden (obligation to permit use) must run with their respective parcels to bind successors in title.

• Benefit — passes automatically to successor owners of the dominant tenement at law if the easement is properly appurtenant (connected to enjoyment of the land); no express assignment needed
• Burden at law — an easement burden passes at common law to successors in title to the servient land if (a) the burden is negative or quasi-negative in character and (b) the successor has notice. Under Land Titles, registration provides constructive notice.
• Registration — On Land Titles land, easements should be registered against both the dominant and servient title PIN numbers. An unregistered easement may not bind a bona fide purchaser for value without actual notice (LTA s.78).

Extinguishment of Easements

An easement may be extinguished by:

Restrictive Covenants: Tulk v Moxhay

A restrictive covenant is a negative promise made in a conveyance of land — the buyer of land promises the seller not to use the land in a certain way (e.g., "not to build any building", "not to use for commercial purposes", "not to subdivide"). At common law, the burden of a covenant does not run with the land to bind successors (Austerberry v Oldham Corporation (1885) 29 Ch D 750, confirmed Canada).

In equity, the burden of a restrictive covenant runs with the land under Tulk v Moxhay (1848) 2 Ph 774, provided four conditions are met:

1. Negative in substance — the covenant must restrict the use of the burdened land (not require positive expenditure or action by the covenantor). The test is substance, not form. "Not to erect any building" is restrictive. "To maintain the fence" is positive and does not run at law or equity to bind successors.
2. Intended to benefit retained land — the covenant must have been made for the benefit of land retained by the covenantee (or their predecessor). A covenant does not run unless it accommodates an identifiable dominant tenement. Residential neighbourhood scheme covenants (building schemes) satisfy this where all owners in the scheme are bound and benefitted (Elliston v Reacher [1908] 2 Ch 374 building scheme doctrine, recognized in Ontario).
3. Successor had notice — the successor to the burdened land must have had actual or constructive notice of the covenant at time of acquisition. Under the Land Titles Act, registration of the covenant on the burdened title provides notice to all successors. Under the Registry Act, constructive notice may arise from the title chain.
4. Benefit has passed to the plaintiff — the party seeking enforcement must show the benefit of the covenant has passed to them, either by express annexation to the dominant land, by express assignment, or by operation of a building scheme.

Positive Covenants Do Not Run

Positive covenants (obligations requiring expenditure of money or active steps) do not run with land in equity or at law in Ontario following Austerberry. The Supreme Court of Canada has not overruled this. Practical mechanisms to achieve the same result include:

• Halsall v Brizell [1957] Ch 169 chain of indemnity — each purchaser covenants with the vendor to observe the positive covenant and to obtain a similar covenant from the next purchaser; enforceable through a chain of direct obligations (common in shared-driveway and road maintenance obligations in Ontario subdivisions)
• Long-term lease — the benefit and burden of leasehold covenants (positive and negative) run between original parties and successors by privity of estate under the Commercial Tenancies Act
• Condominium Act 1998 s.14 — condominium declarations and rules (including positive maintenance obligations) bind all unit owners and run with the unit title
• Conservation easements (Conservation Land Act, Ontario Heritage Act easements) — may include positive obligations to maintain natural areas by statute

Building Schemes (Neighbourhood Schemes)

A building scheme (also called a neighbourhood scheme or community scheme) arises where a common vendor sells off lots in a defined area, each sale subject to uniform restrictions, with the intention that the restrictions be for the benefit of all the lots in the scheme. The Elliston v Reacher requirements (adopted in Ontario) are:

1. Both plaintiff and defendant derive title from a common vendor
2. The common vendor laid out the area in defined lots before selling
3. The restrictions were intended by the common vendor to benefit all lots in the scheme
4. Each purchaser bought on the understanding that the restrictions would benefit all lots

Where a valid building scheme exists, every lot owner can enforce the covenant against every other lot owner, regardless of the order of sale and without formal annexation. This is significant in old residential subdivisions in Ontario where titles show repetitive covenants (e.g., residential use only, no subdivision, minimum setbacks).

CLPA s.61: Discharge or Modification of Restrictive Covenants

Section 61 of the Conveyancing and Law of Property Act R.S.O. 1990, c. C.34 grants the Ontario Superior Court of Justice jurisdiction to modify or wholly discharge a restrictive covenant where it is satisfied that one or more of the following grounds exists:

1. Obsolete by reason of changes — the restriction has become obsolete by reason of changes in the character of the property or neighbourhood, or other material change in circumstances, such that the restriction no longer serves the original purpose (Re Beale (1975) 10 OR (2d) 31, ONCA: development of commercial strip rendering residential covenant obsolete in former residential neighbourhood)
2. Impedes reasonable use without practical benefit — the continued existence of the covenant impedes some reasonable user of the land for public or private purposes and either (a) the covenant confers no practical benefit of substantial value or advantage on the persons entitled to its benefit, or (b) it is contrary to the public interest
3. Agreement — the persons of full age and capacity entitled to the benefit of the restriction have agreed, expressly or by implication, to the discharge or modification
4. No injury — the discharge or modification will not injure the persons entitled to the benefit of the restriction

Registration Under the Land Titles Act

Ontario has been substantially converted to the Land Titles Act system under the automated Land Registry Information System (POLARIS). Key registration points for easements and covenants:

• Easements — registered as a separate instrument (e.g., grant of easement by Transfer/Deed) on the Property Identifier (PIN) for the servient land. The dominant PIN is noted in the instrument. Registration provides notice to all successors under LTA s.78.
• Restrictive covenants — registered on the burdened PIN. The instrument identifies the covenanting land (burdened) and the benefitted land. Where the benefitted parcels are multiple (building scheme), they are listed or described by reference to the registered plan.
• Absolute title guarantee — Land Titles absolute title (the most common form in southern Ontario) does not give absolute guarantee of registered easements and covenants: the Land Titles Assurance Fund compensates only for errors in the register, not for substantive rights.
• Statements of exception — LTA s.44(1) exceptions include easements and rights acquired by prescription before July 1, 1886 and certain utility easements that bind the title without registration.
• Title insurance — First Canadian Title, Stewart Title, and Chicago Title underwrite easement and covenant risks for both lenders and owners. Review the specific policy exceptions before relying on title insurance as a substitute for covenant discharge.

Remedies for Breach

The primary remedies for interference with an easement or breach of a restrictive covenant are:

• Injunction (mandatory or prohibitory) — the most common remedy; obtained by motion for interlocutory relief (RJR-MacDonald v Canada [1994] 1 SCR 311 three-part test: serious issue to be tried, irreparable harm, balance of convenience) or at trial
• Damages in lieu of injunction — court may award under Courts of Justice Act s.99 where injunction would be oppressive and damages are an adequate substitute; in practice courts are reluctant to substitute damages for breach of a restrictive covenant where the violation is ongoing
• Declaration — declaratory relief confirming the existence, scope, and parties entitled to the benefit of the easement or covenant, useful where breach is disputed or anticipated
• Removal / reinstatement order — mandatory injunction requiring demolition of a structure built in breach; courts weigh hardship against the deliberate nature of the breach (Jaggard v Sawyer [1995] 2 All ER 189 principles applied in Ontario)
• Damages at common law — available for tortious interference with easement rights (private nuisance or trespass to land)

Practice Points for Ontario Real Estate and Litigation Lawyers

Frequently Asked Questions