Bolton v Perry

In *Bolton v Perry*, the High Court of Australia considered a dispute between the appellant, Mr. Bolton, and the respondent, Mr. Perry, concerning the interpretation and enforceability of a restrictive covenant contained within a deed of sale for a parcel of land. The covenant purported to restrict the use of the land for any purpose other than a private dwelling house.

The central legal issue before the High Court was whether the restrictive covenant was valid and enforceable, specifically in light of the common law rule against perpetuities and the potential for the covenant to unduly restrain trade. The court was required to determine if the covenant, as drafted, offended public policy by creating an unreasonable restraint on the use of land and whether its duration was sufficiently certain.

McHugh and Heydon JJ, in their joint judgment, reasoned that the covenant, while intended to preserve the amenity of the neighbourhood, was too broad in its scope and effect. They applied principles of contract law and property law, considering the established tests for the validity of restrictive covenants. The court found that the covenant, by its wide-ranging prohibition on any use other than a private dwelling house, constituted an unreasonable restraint on the use of land and was therefore void as contrary to public policy. The judges also considered the rule against perpetuities, but ultimately found the covenant's invalidity stemmed from its unreasonable restraint.

Consequently, the High Court allowed the appeal, holding that the restrictive covenant was unenforceable.