§ 47-37-02 — Nature of rights - Subordination of interests

1. Any person, including a person that owns an interest in the real property, the agency,
or a municipality or other unit of local government, may be a holder. An environmental
covenant may identify more than one holder. The interest of a holder is an interest in
real property.
2. A right of an agency under this chapter or under an environmental covenant, other
than a right as a holder, is not an interest in real property.
3. An agency is bound by any obligation it assumes in an environmental covenant, but an
agency does not assume obligations merely by signing an environmental covenant.
Any other person that signs an environmental covenant is bound by the obligations the
person assumes in the covenant, but signing the covenant does not change
obligations, rights, or protections granted or imposed under law other than this chapter
except as provided in the covenant.
4. The following rules apply to interests in real property in existence at the time an
environmental covenant is created or amended:
a. An interest that has priority under other law is not affected by an environmental
covenant unless the person that owns the interest subordinates that interest to
the covenant.
b. This chapter does not require a person that owns a prior interest to subordinate
that interest to an environmental covenant or to agree to be bound by the
covenant.

c. A subordination agreement may be contained in an environmental covenant
covering real property or in a separate record. If the environmental covenant
covers commonly owned property in a common interest community, the record
may be signed by any person authorized by the governing board of the owners'
association.
d. An agreement by a person to subordinate a prior interest to an environmental
covenant affects the priority of that person's interest but does not by itself impose
any affirmative obligation on the person with respect to the environmental
covenant.