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The most common grounds for the Lands Tribunal agreeing to discharge or modify the restriction are that the restriction is obsolete due to the change in the nature of the neighbourhood since the time it was originally imposed, or that the restriction prevents the reasonable use of the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.
Hi There
I curently live in an area which is covered by a restrictive covenant drawn up in 1980. It is my beleif that there are certain provisions in the covenant that are obsolete, and are of no benefit. For example, there is a restriction regarding tv ariels and by proxy satalite dishes being attached to the property. ALL of the properties covered by the covenant have satelite dishes, and never has this clause been enforced. However, periodically, the directors (essentially a thiefdom with no constitution that appoints), threaten residents with enforcement action regarding said dishes.
Additionally, all properties have garages, and another clause states that NOTHING but a car be stored within the garage! As there is private designated parking that covers the area, 90% of residents store junk in their garages. Again, this gasn’t been enforced yet, but the directors (who all have double garages and driveways by the way, unlike us)again periodicall issue threats to enforce on this.
Moreover, they tell us that if they choose to enforce, they will cover their costs by dipping into the funds (each resident pays £500 a year)accrued by the trust!
In your opinion, could these clauses be removed? as if they were, the amenity of the area would not be affected in any way. Moreover, it is the ‘unofficial’ status quo anyway?
I really look forward to your response.
Many thanks
We are five houses on the outside of a reasonably large estate which face on to a rural lane. Our garages are at the rear of the properties and are accessed via a ‘service road’ which runs from a road located to the side of the row of 5 properties. This road originally provided the address of the five properties. Initially the only access to our front door was via a path which ran parallel to the rural lane, crossing each neighbour’s property, to the road on the side of the five properties. A hedge, which we individually own, separates the houses from the rural lane.
Whilst the delivery of parcels was always problematic, because the addresses were numerically in sequence with houses on the road adjacent to the properties and which ran into the estate, it was the difficulty arising from emergency services not being able to find us which caused us to seek the option of having an address derived from the rural lane to the front of the properties. The council department responsible for providing addresses to properties stated we could change our address provided we formed a physical connection with the rural lane. Having contacted the local district council and county council we found that we did not need planning permission and four of us built a path from our front door direct on to the rural lane. One neighbour installed a drive as they had sufficient land in front of their property to park vehicles.
Subsequently we have found that two covenants exist in our deeds stating:
a) No previously existing tree hedges or plants nor any planted by the Transferor in accordance with a landscaping scheme or pursuant to any planning permission may be damaged or removed ad shall be maintained in accordance with good horticultural or arboreal practice.
b) that the hedge (which we own) and any trees ‘must maintain in the position as previously existing … Boundary Structures (together with any garden hedges…) in good condition repairing and renewing to their original specification as necessary ….’
These covenants were, we understand, initiated to satisfy planning conditions and included the establishment of a property maintenance company to look after the hedges and trees to three separate areas of the estate of which our five houses form one area. There are fifteen properties in total (across the three areas) and we are all shareholders. However, despite the properties being eight years old, the property company is only now being formally transferred from Miller Homes to the shareholders because the council has only just adopted the estate’s drains etc. The purpose of the property company – to maintain the hedges and trees – has not been performed by Miller Homes in the subsequent period resulting in each of us to look after the hedges ourselves.
The only people directly affected by our breaking of the covenants are the five properties mentioned. It has been agreed by all five of us, and others, that the landscaping which accompanied the building of the paths/drive (primarily grassing the areas on either side of the hedge) has substantially, improved the outlook for everyone.
We did think of drawing up an agreement between the five of us stating that we had no objections to each other’s paths/drive but as this would not carry any legal weight we are concerned that the covenant issue might affect our ability to sell our properties. What is our best course of action – especially one which will not cost a fortune?
Many thanks
Hi,
We purchased a property 4 years ago on a piece of land restricted by covenant to 10 dwellings. 2 more dwellings had received planning permission and one is now built.
I contacted my solicitor who advised me that I was not a beneficiary of the restrictive covenant and there was nothing I could do. Consequently I responded to the planning permission (which was just for a change of consent) with some preferences.
I have since revisited my deeds due to another issue and it clearly states under Rights Granted, that; the property has the ‘benefit of all covenants which have been made by other owners of any part of the development and which can benefit the property’.
The new houses change my property from one which overlooks mature trees and open countryside, to one with no view at all of the countryside, and would clearly affect the future value of my property.
Firstly, can I pursue a claim against the developer, and secondly, and perhaps more usefully, did my solicitor act poorly in advising me I couldn’t prevent the development?
Thanks,
Shirley
Hi,
My neighbour and I wish to develop our houses and put 8 new ones on the site. The land used to belong to the vicarage, which used to belong to the diocese.
The vicarage has been sold off by the church to private owners, does that now mean our covenant to not build so much as a birdhouse is now null and void? Or could the covenant have transferred to the church (neighbour but 1 away from site) of transferred to the joe public purchasers of the vicarage.
Thanks Luke
Hi
I was hoping you could be of assistance. I am due to buy a property which has a restrictive covenant dating back to late 1800 and 1920s.It states that the land can only have one dwelling constructed on it. It was an acre of land. The developer has knocked his house down to build two dwellings on it splitting the land into two 0.5 acre plots with full consent of planning permission. He has indemnity insurance also against the breach. My concern is that if I want to sell the property in a few yrs time the property will become devalued as people will be put off by the potential risk of enforcement of breach. Have you experienced this as many people i have spoken to say do not buy the property, how common is it for breaches like this dating from 1920s to be enforced and is it considered to be a big risk in conveyancing circles. considering the property is very expensive…..thankyou
Hi there. I live on a small residential estate. The builder (Belway) imposed a restrictive covenant on these houses when built in 1994. The deeds say the house must be for a single household only, not for business. It has become apparent that my neighbour (we have a shared driveway) is in breach of the covenant – he rents several of the bedrooms to un-related people. I am trying to sell my house. My conveyancer has said Bellway are not allowed to remove the covenant. I have to declare all of this on form TA6. I am worried that I will not find a buyer with this in the background. It all came to light last year when another neighbour tried to sell to a couple who wanted to rent out 2 rooms to students. Their sale fell through due to the covenant. I want to sell mine to a family but worried the problem re next door’s breach will affect me. Any help greatfully received. Lindy
Hi
I bought a garden flat last year ,which was a lease and not a share of the freehold. I was informed by the solicitor acting for me there was a covenant on the property .
But took a view at the time that the flat was in such a bad condition and the previous tenant had been thrown out by the courts a year previously.
The covenant states that all the lease holders have to agree to any work I do on my property.
Since I have bought the property he have bought the freehold and now are all joint freeholders.
There is a partially dug basement which I would like to extend and I would like to add a back extension, naturally everything I would do would be getting full planning permission from my local council.
But every time I email, or request a meeting everybody the leaseholders have a problem,
I just received an mail now stating they are refusing me permission to do any work.
I ave been doing my best to accommodate the first plans I offered to redo their communal staircase which is separate to mine, they refused that, which was the one leaseholders i
Fathers ideas,
Any ideas? Any advice at this time old be helpfully
Hi,
We have a restrictive covernant on our property: We live on a large estate built by a large building Company in 1982, this building Company still exists.
We obtained planning permission to build a 4 bed detached house in our garden, but the orginial builder of the estate wanted us to pay them 60K to give their permission. This was out of our price range and they wouldn’t negioate, so planning expired and we didn’t build.
We now would like to build a large extension to our house as a single dwelling, as many owners have done on our estate, but fear for how much the bulders want, even though most others until sale haven’t obtained permission.
Our Covernant says:
1. Nothing shall be done or suffered on the Premises which shall be or grow to be an annoyance to any person in whom the benefit of any of the covernants contained in this Transfer shall at any time be vested:
2. Unless the consent in writing of the Vendor shall be first obtained
i the exterior appearance of the buldings walls fenses and other erections now on the Premises shall not hereafter be altered.
ii no additional buildings walls fences or other erections shall hereafter be constructed or maintained on the Premises
iii no building on the premises shall be used for any purpose save that of a private residence for a single household and the garage for the garaging of a private motor vehicle.
Nothing shall be done on the Premises which will be an alteration to or departure from the overall landscaping scheme for the state as a whole.
We would like to proceed but obtain permission, but again it wouldn’t be viable should they be asking for 1000’s, any advice would be greatful.
We hope to obtain planning permission to build upon a plot of land that was purchased in the 1960’s by a previous owner of the house we now own. Originally, one of several building plots with planning permission to erect a detached dwelling, it was sold by the developer as garden land and a restrictive covenant placed upon it not to build. The developer, a limited company, subsequently ceased trading. A UK bank was another party to the covenant. We have approached this bank and they have confirmed that they have no interest in the land and do not object to the restrictive covenant being lifted. We are advised that no other party could enforce the covenant unless the benefit was assigned to some other, unknown, third party. We are aware that we can purchase indemnity insurance to cover this eventuality.
The dilemma we have is whether to proceed to planning permission or whether to remove the restrictive covenant first. Any planning application is likely to attract many objections based upon the restrictive covenant and we are concerned that this may result in rejection. Once an application has been rejected, we suspect it will be harder to re-apply.
We hoped that having the UK bank’s approval to remove the covenant would allow us to proceed with a Deed of Release but we are advised not (and that it is not necessary). The prospect of approaching the Lands Tribunal is not appealing, especially if it is not essential.
We your welcome your views on the way to proceed. Thank you.
I purchased a property for myself and son to use whilst at Uni. The house has a restrictive covenant on it preventing sale unless to an owner occupier. I have requested the covenant be removed and had partial agreement from the council…however they have asked what price I am willing to pay for the removal….I have absolutely no idea. House prices in the street are all pretty similar..with or without covenant (mine is one of the few left with one)…where can I find a fair idea of price for the covenant?