In this article I examine a decision of the Upper Tribunal Lands Chamber where it was argued that the Application should be refused as an abuse of process, and that the Court had already decided the matter (res judicata). We’re looking at the case of Housing Solutions v Bartholomew Smith (2023).

The case of Alexander Devine Children's Cancer Trust v Housing Solutions (2020) UK SC45 is now one of the seminal authorities governing how applications are made to the Upper Tribunal Lands Chamber. In Housing Solutions v. Bartholomew Smith, this was effectively ‘Round 2’, whereby the Applicant made a second application to the Tribunal for modification of the same covenants, but this time against Mr Smith, who had not been a party to an agreement reached with the Cancer Trust following the Supreme Court case.

Briefly, the case which went to the Supreme Court concerned restrictive covenants preventing development on land neighbouring land owned by the Cancer Trust. The crux of the case, and which went to the highest court in the land, was the issue of discretion. Whereas planning permission had been obtained, the applicant had acted in ‘cynical breach’ of the covenant - that is to say the applicant approached the Tribunal for forgiveness, rather than permission, having already developed the houses.

In 2021, Housing Solutions then reached an agreement with the Trust, but was no agreement with Mr Smith, who also had the benefit of the covenant. An application was made because Housing Solutions could not sell houses it had developed with the threat of an injunction for enforceable covenants looming (and which had not been discharged by virtue of the failed application).

In summary, Mr Smith opposed the application on the basis that it was an abuse of process, and ought to have been included in the first round of litigation. He argued the parties were bound by the principle of res judicata – the matter had been adjudicated upon by a competent court and therefore may not be pursued further by the same parties. Alternatively, the Tribunal should in any event not exercise its discretion, in a similar manner to that taken by the Supreme Court.

Decision:

The Tribunal held that circumstances had indeed changed since the first application. This application was going to be dealt with on its own merits. Crucially, Mr Smith's position was different to that of the Cancer Trust in the first case - his was arable land and there was no practical benefit of substantial advantage which was being infringed. Mr Smith had failed to demonstrate that his land would be diminished by the developments by the applicant.

The Tribunal's discretion was exercised, and the covenants modified. It did so under grounds (aa) section 84 of the Law of Property Act 1925, that the covenant impeded reasonable use and there were no benefits of substantial advantage to the objector.

Case reference: Housing Solutions v. Bartholomew Smith (2023) UKUT 25 LC.

Toby Walker and his team specialise in disputes over property, include applications to the UTLC. They act for both owners and developers as well as those seeking to uphold covenants in all stages from initial advice, negotiations, deeds of variation and litigation. Toby has written extensively on covenants and you may wish to check out here for an overview on covenants and what you may be able to do with them. If you have an issue relating to restrictive covenants please contact Toby on 01494 893512 or by email.