The law of restrictive covenants is a complex area and a mystery to many landowners, some of whom believe that restrictive covenants cannot be challenged, however, this is not the case.
Restrictive covenants affecting land arise out of an agreement that one party will restrict the use of its land in some way for the benefit of another’s land. The restrictive covenant is capable of being enforceable by one party’s successors in title against the other’s successors in title, as well as between the original contracting parties. Therefore, if your property is subject to a restrictive covenant and you wish to modify or develop it, you may discover that you are prevented from doing so if the covenant remains on the title.
Checking the title deeds to your property will quickly reveal whether there is a valid restrictive covenant which affects the land. If you find that your property is affected by a restrictive covenant, you should firstly consider whether indemnity insurance is available in order to provide you with protection in the event that someone with the benefit of the covenant takes legal action against you for breaching the covenant. If insurance is not available then you should try and identify the owners of the land which benefits from the covenant and try to reach a compromise with them which will usually involve the payment of money for the release of the covenant. If neither of the above are possible, then an application can be made to the Lands Tribunal seeking an order, which wholly or partially discharges or modifies the restriction.
The most common grounds for the Lands Tribunal agreeing to discharge or modify the restriction are that the restriction is obsolete due to the change in the nature of the neighbourhood since the time it was originally imposed, or that the restriction prevents the reasonable use of the property and modification would not result in those entitled to the benefit of the covenant losing something which provided a practical benefit of substantial value, and, money would be an adequate compensation for any loss suffered.
An application to the Lands Tribunal is a lengthy process sometimes taking in excess of 2 years and can prove to be very costly. Also, the result of an application to the Lands Tribunal is by no means certain, there is a great deal of discretion given to the Lands Tribunal to assess what they believe to be a practical benefit of substantial value.
An applicant will need to instruct an expert to report on whether the person entitled to the covenant would loose any practical benefit of substantial value. It is the expert’s responsibility to calculate any decrease in value which the proposed development might have on the land entitled to the benefit of the restrictive covenant.
Communication and negotiation are key in these situations, it is important to approach those with the benefit of the covenant and try to reach some sort of compromise. Providing them with a copy of the expert report is a good starting point. This may reassure the objector that they have nothing to fear in loosing the benefit of the covenant. If a compromise cannot be reached in the early stages and an application to the Lands Tribunal is made, negotiations between parties can continue right up to the final moments. Trial should be the absolute last resort for all parties concerned.
Compensation resulting from the removal or modification of a restrictive covenant is based upon the reduction in value of the property that had the benefit of the restrictive covenant.
It is also left to the Lands Tribunal to decide who pays the costs of the proceedings, more often than not the applicant will usually end up paying the costs of those who benefit from the covenant, whatever the outcome.
Restrictive Covenant Report
If you have a restrictive covenant which may affect your freehold land, our property litigation team can consider your circumstances, by way of written report. The written report will set out our advice and identify a strategy to achieve your objectives moving forward on the basis of our advice.
Our report will consider all the circumstances giving rise to your query, undertake a full review of all relevant documentation and apply the information gleaned from this review to the appropriate legal provisions. We estimate our fees to prepare our Restrictive Covenant Report will be in the region of £1,000.00 – £1,500 plus VAT and disbursements. Please be aware that cost estimates are provided to give you an idea of the likely costs involved only and costs will vary depending upon the level of papers and complexity involved.
For more information on our Restrictive Covenant Report, please contact a member of our team on 01772 258321.
Philip,
I will need a little more information before I can assist further. If you send in a copy of the document that creates this restriction to our enquiries e-mail address marked for my attention, and also explain a little more about the compensation that you refer to, I will get back to you.
Regards
John
S S
The first thing you will need to ascertain is whether or not your property has the benefit of the relevant restrictive covenants. This can only be done from a consideration of the title deeds. While there may be covenants over your neighbour’s property, these covenants can only be enforced by the owners of the land for which the benefit of the land has been reserved.
If your land does have the benefit then you may well be able to take action, particularly if they intend to build more houses than are allowed by the restrictive covenant.
The first step is to check your property has the benefit, and also check what your neighbour intends to do. We will provide an appraisal of this for an initial fee of £500 plus VAT. We will also advise on funding alternatives for the case.
If proceedings are issued against your neighbour to restrain their development the costs of this can quite quickly escalate. The cost of an initial injunction could well be in the region of £5,000 and if the matter foes to a full trial could well exceed £50,000. You may have legal expenses insurance which would cover these costs and we can go through this with you if you want to take this further.
Regards
John
Robert
Unfortunately, some owners of land that benefits from restrictive covenants consider they have a licence to print money for any consents that are required. The underlying principle behind the enforceability of restrictive covenants is the protection of property interests, not to generate revenue.
The owner of property that has the benefit of a restrictive covenant is normally entitled to have their legal fees paid for consideration of an application for consent, and £350 is not an unreasonably high figure. However, £250 for a handling fee is high,administration fees are usually in the region of £50.
Turning to the fundamental point of whether consent was required, the purpose of the covenant appears to be to limit the number of dwellings on your property to one, and you are not proposing to contravene this provision. However, as there is a requirement to obtain consent to the type of dwelling constructed, it raises the issue of whether consent is needed for an extension after the original house is built. This would very much depend on the size and nature of the extension, but as a future buyer of your property may insist on the consent to be on the safe side, you are probably better to proceed to obtain it.
Regards
John
I’ve noticed a number of comments that have gone unanswered here. I will get round to answering them all shortly.
I have recently submitted plans to my local council for a two storey side extension to my house. I have owned the house for 22 years. The previous owners purchased a strip of land approx 3 metres wide and I have discovered that there is a restrictive covenant stating ‘to utilise the land for the purpose of a garden and for cultivation only and for no other purpose whatsoever’. I am on the end of the row of houses and my proposed extension would have no effect whatsoever on any of my neighbours. It would only extend on to the purchased land by one metre. Has anybody any idea how successful I might be if I applied for a deed of release of restrictive covenant – and how to go about it?!
I have a freehold property which we received planning permission 2 years ago. We have gone through all the legal channels & sorted all the relevant paperwork out. We have won the party wall award & established that when the new development is built there would be no right of light issues to the ajoining neighbours proprety .The title deeds states we cannot build over 3 stoerys however our building has planning permission for 5 storeys.
I bought a property that has a restrictive covenant not to allow beauty school or a barber college. The previous owners put the restriction for the benefit of the current owner and tenant , the owner is hiding the compensation that they are charging me from the tenant, how can I resolve this problem??
I have question about resticted covenant(RC) If you can pl help.
Our Neighbour`s deed has R C to make only maximum 3 houses on the land bu now making 6 houses approved on appeal.The RC also says that-
“The purchager shall not do or permit to be done any act or thing which shall be or may be or cause a nuisance damage grievance annoyance or distubance to the vendor or their successors in title or the owner or tenant of adjoining properties or which tends to depreciate or lessenthe value of the estate of the vendor or ant pert therof as a residential property—-“. it continues to say if he ercts any huts etc the vendor or their agent of owner of adjoining properties may remove of dispose off and will not be responsible for such costs.There are number of implication of both adjoining neighours i.e.
Fence in the R C should not be more than 7 feet but plannining permission granted 9 feet, ground levels will raised above datum (street height) by 1 metter as he built the banglows on the rear garden very high, the banglow is giving me over riddin effect and very near to back of my propery. there are many others. My question is can be as neighbours take injuction against or any other thing we can do?
if so what will be the rough cost to us
Any comments will be appreciated.
S S
My property has a restrictive covenant requiring the building of only a single property with plans approved by the adjoining land owner, being a golf course. Property was built 12 years ago and we purchased it 4 years ago. We have now had a small extension made to the kitchen that can’t even be seen from the golf course. Foolishly perhaps, I requested agreement to the extention-6 months ago – but due to delays by the golf course they have only now given an indication that they have no objection. In the meantime the extension has been started and finished. I have two queries, the first being, did I need to ask them in the first place as no specific mention is made in the covenant about subsequent changes to the single dwelling that has been built? The actual wording is ‘not to errect….except a single dwelling house in accordance with plans….previously approved by the Covenantee’.
The second is that the golf course have just sent an invoice but no other details of their approval or otherwise, for over £700 being £350 for ‘Legal fees and Plan Perusal’ and £250 for ‘Handling fee’ by the golf course – obviously plus VAT. This seems very unreasonable and excessive. I had to supply all documentation and feel that, unless I’m the first to ask for such approval, they should be able to provide approval for a nominal charge. Is there any way I can get this charge reduced or alternatively just ignore getting approval in the hope they will not pursue the matter?
Many thanks.
Hi Pearl,
Very difficult to give unequivocal opinions in cases that may find their way to the Lands Tribunal. However, I do find it difficult to see what meaningful benefit could be derived for the benefit of the footpath. If this was an attempt to preserve a ransom payment from you in the future, the Lands Tribunal ought not to order any compensation.
Best of luck!
John