Imagine you/your development partner are carefully crafting and creating a high specification development that is intended to maximise density whilst also ensuring the buildings produced fit within a balanced and harmonious community. You meticulously plan everything, including plot sizes, landscaping, access to amenities and the distinct character and style of each dwelling on the estate.
You think the estate is perfect, so how do you ensure that all of this effort, and the character of your scheme, is preserved for the future?
In short, restrictive covenants.
How do restrictive covenants help?
They allow a landowner to secure promises from plot purchasers affecting/restricting the use of land in specific ways, for the benefit of the rest of the estate. These promises bind the land and any successive purchasers.
Inevitably, and understandably, as time passes and properties do change hands, purchasers may want to change their properties in varying ways.
The art of restrictive covenants is in the drafting, but also in how those with the benefit of the restrictions implement, enforce and also give appropriate consideration to proposals for change.
A recent Lands Tribunal decision shows that it is possible to resist claims for restrictive covenant modification, where they are for the benefit of a building scheme/estate.
Mrs Hussain owned a freehold house on a small self-built development which had remained largely unchanged since it was built in the 1980’s. Some garages had been converted into living space and porches installed, but the building line and form were otherwise preserved.
Mrs Hussain wanted to extend her property and obtained planning permission for the changes, including the addition of a third storey. Restrictive covenants bound the property, meaning that she was not able to enlarge, extend or alter the external appearance of her property without consent from the Residents Association. Mrs Hussain made her application for consent, which was refused.
Mrs Hussain said that her proposed extension was “sensitive, logical and proportionate” and the restrictive covenants unjustifiably impeded her use of the property. She argued that any benefit the Residents Association, close neighbours and the wider estate accrued as a result of the restrictions, was not of significant enough value to prevent her extension.
She applied to the Upper Tribunal to have the restrictive covenants modified pursuant to Section 84(1) of the Law of Property Act 1925, to allow her to extend.
The application was dismissed.
The Tribunal said that the restrictive covenants did, in fact, secure substantial advantages to the remainder of the estate because:
- The restrictions were covenants crafted to protect a carefully designed building scheme, including the outlook and amenity enjoyed by each house owner, which had significant weight;
- Apart from minor changes, which did not change any building footprint, the estate has remained consistent with the original concept and design objectives;
- The Residents Association had actively maintained these concept and design objectives by consistently opposing changes that would alter the character and appearance of the estate;
- The proposed changes would adversely impact on her neighbours’ outlook and amenity (including daylight/sunlight and overlooking), which was considered a substantial advantage; and
- Mrs Hussain’s house was not materially different from any of the others in terms of size, material, design and fitted harmoniously within the estate. Meaning that if her proposals were accepted it could set a precedent for similar extensions which would further impact the character of the estate.
This was an unusual example of a development managing to preserve and protect its character over a long period of time.
Granted this might well have been achieved, in some measure, by many of the original self-builders remaining owners, but it shows that it can be difficult to modify restrictive covenants where there is a commitment to consistently uphold what are “estate rules”, that all house purchasers will have understood they were bound by.
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