Question

A restrictive covenant contained in a deed which prohibits sale to persons of a particular race will:

Selections

• A. Invalidate the conveyance

• B. Have no effect in the conveyance and the covenant will not be enforceable

• C. Create the power in the grantee to void the conveyance

• D. Retain in the grantor the power to enforce the covenant 

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Answer: B

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5 Keys Summary

• A restrictive covenant in a deed that prohibits the sale of property based on race will not be enforceable and will have no effect on the conveyance of the property.

• The Supreme Court ruled that judicial enforcement of racial covenants in real estate constitutes state action, violating the Fourteenth Amendment, making such restrictions legally unenforceable.

• Title VIII of the Civil Rights Act of 1968 (Fair Housing Act) and California’s Fair Housing Law explicitly prohibit discrimination based on race in the sale, rental, and financing of residential real estate.

• Any private restriction in a deed, such as a discriminatory racial covenant, that violates public policy is legally deemed to have no executive validity or effect.

• Such discriminatory covenants are considered unlawful, illegal, and unenforceable under federal and state civil rights legislation.

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