Restrictive covenants are restrictions on the rights relating to a property. They may, for example, allow rights of access over the property concerned or operate to prevent a nuisance to nearby landowners.
The procedural law relating to such covenants is complicated, but any covenant created after 1 January 1926 must be registered to be effective.
It is often the case that a covenant was created many years ago for a perfectly good reason, but the reason no longer exists. When that is the case and the covenant has a negative impact on the land owner it affects, it may be possible to have the covenant modified or removed altogether. This can be done by contacting the person benefiting from the covenant and obtaining their agreement to discharge it or by making an application to the Land Registry, which can often lead to a court hearing.
The law allows a covenant to be modified or discharged when:
- it is obsolete in that it secures no practical benefit to those entitled to enforce it; or
- it is contrary to the public interest; or
- financial compensation would be adequate recompense for its discharge and its continuation would impede a reasonable user of the land; or
- its modification or discharge has been agreed (expressly or by implication); or
- its discharge or modification would not harm those entitled to benefit from it.
Although this list makes it look as though obtaining a modification or discharge of a covenant should be straightforward, the court will not permit this unnecessarily. For example, in a recent case, an application to discharge a covenant which prevented the erection of more than one dwelling on a piece of land was rejected by the court, which took account of the impact of the building on the neighbourhood. An increased risk of flooding, the alteration of the character of the area and a reduction in sunlight to adjoining property were just three of the factors which collectively swayed the court.
If your land is subject to a covenant that impairs your use of it, contact us for advice. It may seem tempting to try to reach an agreement yourself with the person benefiting from the covenant, but it is normally inadvisable as there are a number of complexities and potential traps for the unwary. For example, in some circumstances a modification or discharge of a covenant may create a charge to Stamp Duty Land Tax.