Brief Fact Summary. A parcel of land was sold with the restriction that it could not be used for a discount store. The deed said the restriction ran with the land.
Synopsis of Rule of Law. Reasonable covenants to compete may be considered to run with the land when they serve a purpose of facilitating orderly and harmonious development for commercial use.
Issue. Does a non-competition clause in a deed that puts restrictions on the grantor touch and concern the land?
Massachusetts has been practically alone in its position that covenants not to compete do not run with the land. This rule is in need of change. Reasonable anticompetitive covenants are enforceable in most states.
It would be unfair not to enforce the anti-competition clause because Plaintiff was probably paid extra money in return for the restrictions and the restriction was one of the reasons Trust bought the land in the first place.
Reasonable covenants to compete may be considered to run with the land when they serve a purpose of facilitating orderly and harmonious development for commercial use.
An enforceable covenant will be one which is consistent with a reasonable overall purpose to develop real estate for commercial use.
Discussion. In a commercial lease, reasonable anticompetitive covenants are enforceable by and against successors to the original parties.