Restrictive covenants is one of the most Googled litigation terms year on year. Understanding what they are; establishing if one impacts you; and working out how to remove one; are all key concerns for clients. We frequently receive enquiries from clients trying to understand what restrictive covenants are, and how to challenge them. Will Bartley, a Property Litigation specialist at Porter Dodson, discusses in this Q&A the most common questions that we receive regarding restrictive covenants.

For a comprehensive guide on restrictive covenants, please read our previous blog here. 

What is a restrictive covenant?

A restrictive covenant is essentially a commitment made by one landowner to another, prohibiting certain actions or activities on their property. For example, this might include promises not to build more than one dwelling on a specific plot of land. This might be to prevent the character of the area from being diminished from overcrowding, or to prevent building works causing noise nuisance or blocking a neighbour’s view. A further example of a restrictive covenant could be limiting use of residential property to residential use, and not for the running or operating of a business. There are plenty of examples of restrictive covenants, and they typically look to limit how the land/property can be used so that it does not detriment the benefiting land.

However, not all promises between landowners qualify as restrictive covenants. To be enforceable, several key criteria must be met.

How do I see if my property has a restrictive covenant?

Restrictive covenants are recorded in the property ownership title documents.  To be enforceable, the covenant must be registered. In cases involving registered land, the covenant should be registered via a notice in the Charges register of the registered title.

Therefore, it should be relatively straightforward to ascertain whether there is a restrictive covenant(s) affecting your property from reviewing those documents. We would be happy to assist you with this if required.

Why are restrictive covenants used?

Restrictive covenants are intended to prevent owners from making changes/using their property in a certain manner, to avoid such changes/use having a detrimental effect on the benefitting land.

The beneficiary, also known as the covenantee, has the right to enforce restrictive covenants. This can lead to litigation and a costs award in their favour should someone ignore the covenant and refuse to stop breaching it. It is therefore crucial to act quickly and take prompt legal advice, to avoid the repercussions and potential for negative financial outcomes. For example, continuing with a development of land could have significant construction costs, and if it is deemed that such development is in breach of a restrictive covenant, then the owner may be ordered to take it all down, which would obviously be incredibly expensive and a waste of money. It is therefore vital to get advice on any restrictive covenants before deciding to act upon them (or ignore them!).

Can I challenge the restrictive covenant / get it removed?

If you wish to have a restrictive covenant removed, you can enter into a deed of release with the benefitting party. It may be that you have to pay them a fee for their agreement, however this is often simply a commercial arrangement that may be worth the investment. If such an agreement cannot be reached, or you cannot identify the benefitting party, an Application to the Upper Tribunal will be necessary.

Applications to the Upper Tribunal

Landowners burdened by a restrictive covenant have the option to seek modifications or discharges through the Upper Tribunal (Lands Chamber). This legal avenue is governed by Section 84(1) of the Law of Property Act 1925, which outlines specific conditions that must be met for a successful application.

Grounds for Modification or Discharge

Section 84(1)(a): This provision allows for modification or discharge if changes in the character of the property or the neighbourhood, or other circumstances of the case, render the restriction obsolete or unachievable in its original purpose.

Section 84(1)(aa): This section, added by the Law of Property Act 1969, provides grounds for modification or discharge when:

• The continued existence of the covenant obstructs reasonable land use.
• The covenant does not offer substantial practical benefits to those with the benefit of the covenant or is against the public interest.
• Compensation in monetary terms would suffice to compensate for the loss or disadvantage if the covenant is modified or discharged.

Section 84(1)(b): Modification or discharge can also be sought if the person with the benefit of the restriction agrees to such a change.

Section 84(1)(c): The proposed modification or discharge should not cause injury to the person with the benefit of the restriction.

Therefore, the respective restrictive covenant and the likelihood of getting it removed will be very case specific. For example, if other properties in the locality have had similar restrictive covenants removed, then it may increase your likelihood of success. If the covenant is a hundred years old, and offers no practical purpose in modern society, that may also boost the prospects of success. However, if the covenant has only recently been implemented with a specific purpose, and an Application would likely face objection, then such an attempt to have it removed may not succeed.

Will a restrictive covenant affect a sale of my property?

Potentially yes. It will depend on the circumstances, and how detrimental the covenant is. The more likely outcome is that it may limit your ‘buyer-pool’, as developers would be unlikely to purchase land where a restrictive covenant is in place to prevent such development, whereas a retried couple may view such a covenant as a benefit, and be more likely to purchase it. Each property / covenant will turn on its own facts.

Restrictive covenant insurance can help protect property owners from potential legal action and costs associated with restrictive covenants, particularly when the identity of the beneficiary/benefitting property is unclear, or the covenant is historical or potentially obsolete.

As discussed however, restrictive covenants aren’t always a negative thing for owners, as they can block nearby unwanted development, or your neighbour from making changes to their own property or running a business from their property that could cause nuisance. Buyers should always make investigations into restrictive covenants when considering purchasing a property, and their conveyancing solicitor will advise them accordingly.

Specialist advice

Please note that advice in respect of restrictive covenants is very case-specific, and therefore the above is simply a guide as to the process and common questions that we get asked. We recommend that you take specialist legal advice if you have a restrictive covenant question.

Porter Dodson’s specialist Property Litigation department would be happy to assist with such enquiries.