The recent (January 2023) case in Quantum (Barrowsfield) Limited concerned an application to discharge covenants prohibiting anything other than single private dwelling houses on land. Planning permission had been given for demolition of 4 properties and the erection of 4 5-storey buildings of 33 flats. The decision is important for its treatment of expert evidence on amenity and diminution. 

This is part of a series of Blogs where I attempt to summarise the latest decisions from the Upper Tribunal Land Chamber – the specialist court for applications to modify covenants affecting land under s84 Law of Property Act 1925 (the Act). 

The properties at 2, 3, 4 and 5 Barrowsfield in Sanderstead, South Croydon, were acquired by the applicant to develop. The applicant faced 3 restrictive covenants: 

• a 1908 covenant that only detached private houses be built with approval from the Vendor; 

• a 1963 transfer that no buildings be erected other than a single private dwellinghouse and with approval; and

• a 1993 transfer that the property shall only be used for the occupation of one household only.

The principal objections (from neighbours) were: diminution in value that the development would cause to the objectors’ properties, as well as amenity including noise from increased traffic and number of residents, and the imposing sense of being hemmed in by a large building close by.

The Applicants sought complete discharge of the 1908 covenant on the basis of obsolescence, as the original benefiting party had deceased. They succeeded on this element. 

The Applicants claimed that there were some benefits or advantages to the Objectors of the covenants, but that these were not substantial, and money in the order of £14,400 and £10,400 would be adequate compensation for their loss.

An interesting quirk of this case was that Mr Bell, one of the Objectors, was a chartered architect, and who produced from software within his own architectural practice, CGI representations of the proposed development as it would be seen from Limpsfield Road. The Tribunal did not treat Mr Bell as an expert (in his own case), but this was taken into account as evidence of fact. 

The expert evidence was polarised, and both experts in this case were given a hard time in the decision.  The applicant's experts said there would be a marginal loss of amenity, in the order of 1% to 2% of value; whereas the Objectors’ expert said modification would lead to irreversible harm to the enjoyment of the properties and a substantial loss of value in the order of 10% to 15%. According to the Tribunal ‘neither valuation expert based their selection of percentage loss on evidence from the market which could be examined at the hearing, each relying essentially on their long professional experience. We did not find this helpful and it is an approach which we strongly discourage’.

After much detailed discussion within the judgment, the Tribunal held that the setting and neighbourhood aspect of the Objectors’ homes and the prevention of a large building spanning the application site was a benefit, but could not be said to be of substantial value or advantage. Similarly, the Tribunal held the noise and light interference was not a substantial practical benefit or advantage.

What the Tribunal did find, however, and which was fatal to the Applicant's case, was the issue of overlooking of the Objectors’ properties. The Tribunal referenced Mr Bell's CGI images of his computer model representations. They found in particular with regard to the property at number 1A 

‘Mr and Mrs Bell's garden will be overlooked from the roof terraces and from the western elevation of the new building, separated only by number one, and we regard protection from that overlooking as a practical benefit of substantial advantage’. 

The Tribunal referenced the ‘intensity of overlooking the whole building’. Similarly, at paragraph 96, that this ‘obvious’ very large building, would be overbearing and will transform the outlook from number 1A ‘dominating the western sky’ which was held to be a substantial advantage to number 1A and number 1B. 

The Tribunal in conclusion, in finding there were substantial practical benefits of substantial advantage, lacked discretion to modify the 1963 and 1993 covenants.

SUMMARY: in applying to the Upper Tribunal Lands Chamber as a developer, if developing a block of flats, it is not enough to have planning permission and to show a willingness to comply with any conditions that planning or the UTLC might impose. In this case, the evidence of overlooking which the Tribunal said would be ‘intense’ was enough to defeat an application, or conversely, was sufficient to mount a successful Objection.

Case: Quantum Barrowsfield Limited v. Bell and others, Case no. UTLC number LC-2021-61

You can find decisions from the UTLC here.

For more information about Restrictive Covenants affecting land, see our blog here.

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. For assistance in covenant claims, please contact Toby on 01494 521301.