Can You Challenge a Restrictive Covenant?

Shilpa Mathuradas

Challenging a restrictive covenant! Is it obsolete?

It is well known that section 84(1) of the Law of Property Act 1925 allows the discharge or modification of a restrictive covenant where:

• Due to a change in the character of the property or neighbourhood or other material circumstances, the restrictive covenant is obsolete; or
• The restrictive covenant impedes some reasonable use of land and the restrictive covenant a) does not secure any practical benefit to the person entitled to the benefit of the restrictive covenant or b) is contrary to the public interest; or
• The proposed discharge or modification will not injure the persons entitled to the benefit of the restrictive covenant.

When does a restrictive covenant become obsolete?

In a recent case the Upper Tribunal (Lands Chamber) had to consider whether a restrictive covenant was obsolete. The applicant had a property in Cornwall which was part of a residential development of single storey bungalows with large gardens built in the mid 1970s. The rear garden of number 14 had a boundary with Wych Hazel Way. The applicant intended to construct a two bedroom detached dwelling there with access to Wych Hazel Way for which he had obtained planning permission.

Number 14 had the burden of a restriction which arose from a 1974 conveyance not to build anything on the land except the dwelling house and premises under construction at the time, for the benefit of the owners and occupiers of the development. The vendor could release or vary the restriction provided that such right was not exercised in a way that destroyed the general character of the estate as a high class residential area.

The Tribunal considered the four factors identified in the case of Adams and another v Sherwood and others (Re Fermyn Wood) [2018] for an application that the restrictive covenant was obsolete:

1. What was the original purposes of the restriction?
2. Had the character of the property or neighbourhood changed since 1973
3. Was the restriction obsolete as a result of those changes?
4. Were there other material circumstances which rendered the restriction obsolete.

The Tribunal commented that the covenant was for the mutual benefit of owners and occupiers of the development and the reference to a “high class development” was relevant to its purpose. The development had larger sized plots and lower density of development. They also concluded that noticeable changes took place outside the residential development and the object of the restrictions was to retain lower density development and spaciousness within the development which had been achieved and was not obsolete. Accordingly the Tribunal had no jurisdiction to modify the covenant.

Whether a restrictive covenant was obsolete had to be considered carefully and should certainly not be assumed because of the passage of time.

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