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The most common grounds for the Lands Tribunal agreeing to discharge or modify the restriction are that the restriction is obsolete due to the change in the nature of the neighbourhood since the time it was originally imposed, or that the restriction prevents the reasonable use of the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.
I am in process of sueing my neighbour who has a convenant of his deeds.he is ignoring the situation by building his rather large extension. I am concerned that he will immediately put an indemnity insurance policy in force to protect himself, the extension will de-value my property as his house is detached and I am a bungalow, he will block out my light completely, this room is officially a dining room but I use it as a bedroom.
We run a small community group (www.eastleighmensshed.co.uk) from workshops we have build at the bottom of a garden, under a license to occupy. one of the neighbours has now raised a complaint of breach ofa 1928 covenant precluding the use of the land for such “club” uses.
Is this something that can be overturned and would it be expensive?
Kind Regards Andi Saunders
Hello. I have been living in my home for 16 years. My daughter is leaving home soon to go to university. I thought it would be great to rent out my home and then rent another property close by to her university so I can support her when she needs me. However, I believe that in my deeds there is a covenant which states that the property must be owned and occupied by a single family. Does this mean that I cannot rent my property out for a couple of years? I fully plan to come back to this property. Very best regards, Angela
Hello could you advise on the following please.I own a motor vehicle garage Title LA680773 that i want to sell to a national supermarket chain to build a small convenience store on.The problem i have is that in 1929 when the farmer sold the plot he put a covenant on it saying it could only be used as a car garage,however 3 years later he sold the rest of the field (15 acres) to the milk marketing board who built a dairy.Around 70 years later they closed the dairy and sold the site to a national hose builder who built 205 houses on it.The covenant is now no longer prevalent or of benefit to anybody as we are not attached to any of the land that had the benefit of it.I have spoken to all the houses that have been built on the 1929 conveyance and out of 205 there are 122 supporting the unenforceability of it by signing a form,25 supporting it verbally and the rest having no interest at all as they are around half a mile away as the crow fly’s.Out of the 205 people spoken to there is only 1 who doesn’t want a shop as they think kids will hang round it but there is a road,a row of houses and a 10 ft steel fence between them and our site.My question is do we apply to land registry and on which form or do we have to go through the court.I would be grateful if you could give me any advise or direction.PS we have the support of the original farm that put the covenant on which obviously has new owners,our local ward councillor and the house builder who owns the freehold for the new houses. Kind Regards John Stansfield
We lost a recent sale on our home as we apparently have a share with 48 others in a dissolved management company which was set up by the developers as a condition of planning permission with the planning service so he could build.
The developer subsequently failed to file returns and the company was dissolved in 2010. No one was aware there was a management company and residents were never asked to contribute or approached.
Our solicitor did not make us aware of the management company when we purchased the house 11 years ago. Now solicitors won’t accept indemnity insurance to cover the liabilities connected with the non existence of a management company. We dont know what else we can do. We are in the process of applying to the land tribunal to have this restriction removed and they seem happy enough to remove it.
The green areas are outside each house snd residents look after them well and keep place tidy. Apparently the common areas have passed to the crown and there is no agreement for residents to contribute or it may have been possible for another management company to buy the land back from the crown and run a new company which would have sorted the problem. Will i still need indemnity insurance if restrictions removed by land tribunals. The development is made up of houses only all of which are freehold. We have house back on market and several other houses have sold around us in same development. We have told it depends on buyers solicitor and if they accept indemnity insurance. Surely solicitors should all be practicing the same. Help !!
Hello,
Looking into developing five workshop buildings, previously used as part of a bus depot, into a mixture of 2/3/4 storey apartment blocks. However there is a restrictive covenant on the site which states “the landowner is not to build anything taller than two storeys”.
Could you please advise how this will impact the proposed development and how we could resolve this matter etc.
Regards,
Rebecca Newman
Dear Noreen
Thank you for your enquiry.
Before being able to provide you with full advice, we would need to have sight of the title documentation for the property in issue and any other relevant contractual documentation, so that we can review the precise wording of the covenant(s) to determine your obligations and advise you accordingly, if your current solicitors have not already done this for you.
In general, for the land that you intend to purchase to be subject to the burden of a restrictive covenant, that restriction should have been registered on the charges register of the title documentation. Your solicitors appear to have identified these restrictions. Whilst the benefit of a restrictive covenant is not ordinarily registered against the benefitting registered title/s, it can be in some circumstances, and therefore it may also be prudent for us to consider the title/s of any benefitting land. Indeed, it appears that the potential interests of the neighbouring land and builders will need careful consideration.
Upon taking the above steps and after speaking to you to obtain some more information about your situation, we would then be able to advise you about your legal and practical rights and options, including in relation to the indemnity insurance issue that you raise and exploring the possibility of attempting to reach an agreement with the beneficiaries of the restrictive covenants.
Ultimately there would be a cost associated with any work that we complete on your behalf, upon receiving your instructions; however, we would give you an estimate of that cost beforehand.
You will appreciate that without reviewing the title documentation we cannot provide any specific advice to your circumstances. Obviously, if you proceed with the purchase in advance of clarifying your rights and those of the builder and neighbouring land, there is a risk that any covenants that exist and affect the property may be enforced against you in the future.
If you would like to discuss things further, please do not hesitate to contact me on the telephone number or email address listed below. Alternatively, you may contact a member of our Commercial Property team; to do so, please call 01772 258321 in the first instance and ask for a member of the team.
Kind regards
Matthew Astley
01772 429209
matthew.astley@harrison-drury.com
Hi,
we have a very large garden and our local planning department said we would get planning permission in principle to build a 3 bed detached house with a garage on the land. We have a restrictive covenant that states we cant build on our land but I’m not sure if its enforceable.
There are 2 names on the covenant:
1. The builders – Alfred McAlpine Homes West Midlands LTD Who have since changed their name to MCA West Midlands Ltd and then went dormant in 2001.
2. Telford Development Corporation – TDC was wound up in 1991. The council is now Telford and Wrekin.
I would appreciate your thoughts on the enforce-ability of the covenant if the 2 named parties no longer exist.
Regards,
Darren.
Hi,
Please, please, please help. We are about to exchange/complete on a freehold semi in a cul-de-sac and have found three years ago, a RC was placed when builder sold to current vendors. The RC states ‘one dog, two cats’. We have 7 dogs, 3 cats. It says permission has to be obtained, but the builders state although they won’t enforce it, the neighbours might!!!! Although there is another occupant of another house in development who has more than one dog.
Please help me, because I refuse to get rid of my pets, they are literally my life, but we can’t afford a hefty legal bill if someone decides to try and enforce it. According to our solicitor, there is no indemnity policy available for this scenario.
I am sure, if I had 7 kids, there wouldn’t be an eye batted, and all animal lovers know kids are infinitely worse that dogs/cats.
Any advice gratefully accepted
Hello, we have two conifers in our front garden which are breaking up our drive and we would like to remove them. However there is a restrictive covenant in the deeds of the original sale of the house from the builder (who is now out of business) which states that the owner of the ploy should not cut or lop any trees and shrubs on the plot. This is obviously unrealistic, but I would like to know if it is enforceable, and if so, by whom? Thank you. We are not in a conservation area.