Peabody Natural Resources Company, f.k.a. Hanson Natural Resources Company, Cavenham Forest Industries, Inc., A Partner Other Than The Tax Matters Partner - Page 15

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          parties must intend that covenant to run with the land; and (3)             
          any successor against whom enforcement is sought must have                  
          actual, constructive, or inquiry notice of that covenant.  Lex              
          Pro Corp. v. Snyder Enters., Inc., 671 P.2d 637, 639 (N.M. 1983);           
          Pollock v. Ramirez, supra at 153.                                           
               In Lex Pro Corp. v. Snyder Enters., Inc., 100 N.M. at 391,             
          the New Mexico Supreme Court observed that a covenant touches and           
          concerns the land if either (1) the burden of that covenant                 
          renders the covenantor’s interest in land less valuable or (2)              
          the benefit of that covenant renders the covenantee’s interest in           
          land more valuable.  The New Mexico courts have also held that a            
          covenant meets the “touch and concern” requirement if it calls              
          for either doing physical things to the land such as building a             
          wall, or refraining from doing physical things to the land.                 
          Cypress Gardens, Ltd. v. Platt, 952 P.2d 467, 470 (N.M. Ct. App.            
          1997).  The TEPCO and WEF supply contract obligations of Santa Fe           
          and its successors to mine and supply coal from the Lee Ranch               
          mine property do touch and concern that land.6                              
               As to the second requirement that the original covenanting             
          parties intend that the covenant run with the land, the WEF                 
          supply contract specifically expresses an intent to effect a                

               6Although 1 Restatement, supra sec. 3.2, now requires                  
          neither the benefit nor the burden of a covenant to touch and               
          concern land in order for the covenant to be valid as a                     
          servitude, we need not here decide whether this requirement has             
          been superseded under New Mexico law.                                       




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