Legal Definitions - implied negative covenant

An implied negative covenant is a type of covenant that binds a grantor not to allow the use of any reserved right in a way that could harm the benefits that would otherwise go to the grantee. This covenant is inferred from the entire agreement and the conduct of the parties, rather than being explicitly stated.

For example, if a grantor sells a piece of land to a grantee and retains the right to extract minerals from the land, there may be an implied negative covenant that the grantor will not extract the minerals in a way that damages the land or interferes with the grantee's use of the land.

This type of covenant is important in real estate transactions because it helps to protect the interests of both parties and ensure that the benefits of the agreement are preserved.