How restrictive covenants can add value to your land

It is often the case that planning law does not provide the degree of protection that residents might want in the face of unwelcome development of land in the immediate neighbourhood. In such circumstances, the existence of restrictive covenants in the title to that land may offer a separate, and more potent, mechanism for taking action to stop or ameliorate the developer’s plans.

From the perspective of a landowner, who sells off part of his land, appropriate restrictive covenants could provide the opportunity to obtain additional payments in future for agreeing to release the transferee, or his successors in title, from the restrictions imposed on sale.

However, the law relating to restrictive covenants is complicated, and there are a number of hurdles to overcome if restrictive covenants are to be successfully enforced.

In the first place, the person seeking to enforce the covenant must show that his own land benefits from the covenant (so that he has the right to enforce it) and that the land belonging to the covenantor, or his successors in title, has the burden of the covenant and must either observe the restrictions imposed or be liable for breach of covenant.

In the second place, the wording of the covenant needs to be considered carefully. For example, in a recent case (Re Cook [2014] UKUT 0528 (LC)), a couple who wanted to build a larger house on their land, but faced opposition from their neighbours, applied to the Upper Tribunal (Lands Chamber) to modify or discharge the restrictive covenant upon which the neighbours sought to rely.

The covenant included the following restrictions

• not to erect any building except in accordance with plans approved by the vendor and not to make any additions or alterations without the previous consent in writing of the vendor
• not to erect any fences walls sheds or additional buildings of any description without the previous consent in writing of the vendor which shall not be unreasonably withheld.

The tribunal decided that, because of the presence of the express qualification (shown underlined) in the second restriction above, the vendor would be entitled to withhold the requisite approval or consent (shown in italics in the first restriction) even if to do so was unreasonable. This meant that the first restriction was a very severe imposition on the owners of the property amounting, at the vendor’s discretion, to an absolute prohibition on building. But could the neighbours rely on it?

The tribunal decided that they could not because the covenant did not refer to the vendor’s successors in title, as such covenants commonly do, but only to the original Vendor who had passed away. The tribunal therefore found that the restrictions were obsolete.