Upper Tribunal Authorises Bed and Breakfast Use of Historic Property


Many owners of historic homes seek to defray the expense of maintaining them by putting them to some form of commercial use. Such ventures may encounter stiff opposition from neighbours but, as an Upper Tribunal (UT) ruling showed, their objections can, with the right legal advice, be overcome.

The case concerned a listed property that had historical associations and had its origins in the 17th century. After its owner began letting out five of its 15 bedrooms to bed and breakfast customers, a couple who owned a nearby cottage objected. They pointed to a restrictive covenant enshrined in the property’s title deeds which forbade its use as anything other than a single private residence.

The owner applied to the UT under Section 84 of the Law of Property Act 1925 for the covenant to be modified so as to enable the property’s continued bed and breakfast use. However, the couple contended that the covenant should be maintained in full force.

The owner, who had purchased the property for £1.7 million before spending another £1 million on its renovation, said that his desire was to generate a modest income to help preserve the property for the enjoyment of future generations. He estimated the cost of maintaining the property at £50,000 a year, excluding any significant repairs.

The couple, however, said that the property’s business use impinged on the peace and tranquillity enjoyed by occupiers of the cottage. They were anxious to preserve the ambience of the property’s setting and feared that modifying the covenant would be the thin end of the wedge, paving the way for other modifications to be sought enabling further commercial uses of the property or its grounds.

Ruling on the case, the UT noted that the bed and breakfast use of the property was covered by permitted development rights and did not require planning consent. The use was a reasonable one and did not involve making any changes to the property’s fabric. The planning system would continue to protect the couple against any inappropriate development of the property or its estate.

The modification sought went no further than was necessary to enable continuation of the bed and breakfast use and the primary purpose and effectiveness of the covenant would remain untrammelled. The UT found that maintaining the covenant in its current form would afford the couple no practical benefits of substantial value or advantage. Overall, there was no credible evidence that modifying the covenant would have any effect on their interests.

The UT acknowledged that it should have been self-evident to the owner that the bed and breakfast use was in breach of the covenant. However, in authorising the amendment, it found that his conduct was neither egregious nor unconscionable. He had an apparently sincere desire to preserve a heritage asset and to make it available, albeit on a small scale, to the paying public.

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