Welcome to the first in a series of Blogs where we 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). For an introduction to Restrictive Covenants affecting land, see our blog here.
Naidu v Morton and others is an interesting case. The Applicants sought to discharge or modify covenants to enable a 3-storey side extension to their town house at the end of a terrace, within a spacious private development.
The covenants arose from a 1989 transfer said to be for the ‘benefit and protection for all other premises now or formerly vested in the Vendor and comprised in the development’.
At the time the application to the Tribunal was made, the Applicants did not have planning permission for the extension, but did have a qualified pre-application advice. The advice was favourable for the extension, but not for change of use (residential to business).
Some of the neighbours objected in writing but did not attend the hearing.
The case was heard by Tribunal Judge Diane Martin MRICS FAAV on 1st June 2022, at which point the Judge was provided with a copy of the planning application dated 25th April 2022 (at the time yet to be decided by the Council).
The covenant provided
‘not without the previous written consent of the vendors to alter the external plan or elevation of any building standing upon the transfer property…’
‘not to use the transferred property at any time for any purposes other than that of a single private dwelling house and so that no trade business or manufacture whatsoever shall be carried on’.
The Judge held that, as working from home and being self-employed - the stated possible aims of the Applicants – were not impeded by the covenants (a requirement for applications under the Act), she declined to modify the covenant in that regard.
The position was more interesting in relation to the extension, which was said to be clearly prohibited by the covenants.
The Tribunal considered the position under ground (a) of section 84, where a restriction has become obsolete as a result of changes in the neighbourhood since it was imposed. The Tribunal declined to allow a modification on this ground because of a lack of evidence of any changes in the neighbourhood.
The majority of consideration was given to ground (aa) of section 84 (1); whether the covenant impedes some reasonable use of the land or that it would do so unless modified.
There was expert evidence from a Mr Metcalfe who produced a planning statement. Notwithstanding there had been refusals by the Planning Inspectorate in 2001/2002 for a detached garage at the property, Mr Metcalfe's opinion was that the current proposal could be distinguished, and as the extension would be set back from the street and at a lower level of the established building line, the character of the area would not be materially affected.
The Judge considered the written objections from some of the neighbours. There was no submissions or evidence on value, and the Judge had to decide whether there were practical benefits that she had identified which were of substantial advantage. The arguments as to visual amenity put forward by neighbours at number 54 and number 53 were held to be minimal. The Judge considered the issue of precedent and aesthetic value, but considered that the planning process provided residents with sufficient protection.
However, the Judge found that the structural support provided by the application property to number 51, in the form of retaining walls in the garden, was an important practical benefit to the owner.
After some discussion, the Judge decided that despite having identified a practical benefit for number 51, this was not a substantial advantage. There were protections afforded by a framework of national policy and guidance, and the additional protection provided by the covenant was therefore not substantial, with regard to the definition given in Shephard v Turner 2000 2P and CR28 (“considerable, solid, big”).
Perhaps the most interesting aspect of this case is that although the Tribunal Judge considered that the only practical benefit identified was not substantial - which might be enough for an Applicant to the Tribunal to get home on modification - at the final hurdle the Tribunal decided not to exercise discretion in favour of the Applicant. The application was therefore dismissed.
The door was left open for the Applicants, should they finally obtain planning permission whereupon they would have the option of engaging with the objectors to see if concerns might be satisfied by the permission and its conditions.
IN SUMMARY: a reminder to landowners and developer Applicants: even if you are able to convince the Tribunal that the proposed use is reasonable, and even if practical benefits on which the objections are based are not said to be ‘substantial’, you are not home just yet. The Tribunal has the all-important discretion which it may or may not exercise in relation to a given application.
Case title: Naidu v Morton and others TTLC case number LC-2020-33
You can find decisions from the UTLC 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.