One common way of making positive covenants enforceable against successors in title is by using what is known as a “chain of indemnity”. This is where each successive buyer gives an indemnity to the previous owner to bear the cost of complying with the covenant.

For example, a positive covenant might require the issuer to disclose audit reports to creditors periodically or to insure its assets adequately. While positive or affirmative covenants do not limit the operations of a business, negative covenants materially limit a business' operations.

An example of a positive covenant would oblige a party to repair or maintain a fence or wall or to contribute towards the cost of repair and maintenance by another party. A Negative, or restrictive, covenant sets out what cannot be done with the land or property.

Restrictive covenant indemnity insurance is cover for a breach of a restrictive covenant, known or unknown. Typically, this is taken out by the vendor to protect the new buyer of the property against any party who has the ability to enforce these covenants.

Restrictive covenant indemnity insurance is cover for a breach of a restrictive covenant, known or unknown. Typically, this is taken out by the vendor to protect the new buyer of the property against any party who has the ability to enforce these covenants.

Affirmative (positive) covenants are legal promises to engage in certain activities or meet certain benchmarks added to a financial contract that an issuer must follow. Restrictive (negative) covenants instead restrict a company or issuer from engaging in certain actions.

Precedents. This is a Precedent clause for inclusion in a transfer of whole (TR1) or transfer of part (TP1) to provide that the transferee shall observe and perform — and indemnify the transferor against any breach of — the matters appearing on the transferor's title (registered or unregistered).