Use Restriction Unenforceable Beyond Shopping Center?

Originally published 2^nd Quarter 2004

A restriction in a recorded memorandum of lease prohibiting a landlord from allowing another supermarket within five miles of the shopping center may be unenforceable by the tenant against successors of the landlord.

In Wal-Mart Stores, Inc. vs. Ingles Markets, Inc., 158 N.C. App. 414, 581 S.E.2d 111 (N.C. App. Jun. 17, 2003) (No. COA02-896), the Court of Appeals of North Carolina held such a restriction to be only a "personal covenant" of the landlord, rather than a covenant running with the land. Accordingly, a successor of the landlord acquiring a part of the shopping center was not bound by the restriction to the extent it related to land located outside the shopping center.