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The Upper Tribunal (UT) has granted a landowner’s application to modify a restrictive covenant under Section 84 of the Law of Property Act 1925, allowing a small bungalow to be constructed in place of an existing workshop. The decision provides useful guidance on when restrictive covenants may be modified where they no longer secure benefits of substantial value or advantage.
Background to the Dispute
In 1999, the landowner sold part of his land to a local developer, who built three houses. As part of that transaction, the landowner agreed to a restrictive covenant limiting the use of the land he retained to a single private dwelling house with a garden and garage.
The landowner later moved away and, in 2019, sold his house while retaining the land on which a workshop stood. He subsequently obtained planning permission to demolish the workshop and replace it with a small bungalow.
However, implementing the planning permission would have breached the restrictive covenant. The landowner therefore applied to the UT to modify the covenant. The owners of the three neighbouring houses objected.
Upper Tribunal’s Jurisdiction Under Section 84
The UT first considered whether it had jurisdiction to modify the covenant. It found that:
- the proposed residential use was reasonable; and
- the covenant clearly impeded that use.
The key question was whether the covenant continued to secure practical benefits of substantial value or advantage to the neighbouring owners.
Assessment of Alleged Benefits
The objectors argued that the covenant protected them from disruption, loss of privacy and changes to the character of their properties.
The UT rejected those arguments, finding that:
- the construction period would be relatively short, and the covenant was not intended to protect against temporary disturbance;
- any benefit derived from avoiding short-term inconvenience could not be regarded as substantial;
- the quiet enjoyment of the neighbouring houses was unlikely to be affected by a small bungalow; and
- existing covenants already prevented nuisance, annoyance and obstruction of the shared access road.
The UT also found that there would be no significant loss of privacy, save for limited impact on a single room in the house closest to the proposed bungalow.
Importantly, the UT rejected concerns that modifying the covenant would set a precedent making future applications more likely to succeed.
Covenant Modified and Compensation Awarded
Having concluded that the covenant did not secure practical benefits of substantial value or advantage—either individually or cumulatively-the UT held that it had jurisdiction to modify it under Section 84(1)(aa).
Taking into account the age of the covenant and the circumstances of the case, the UT exercised its discretion to modify the restriction.
The UT awarded compensation to the objectors as follows:
- £10,000 and £5,000 for disturbance and access issues; and
- £3,500 to the nearest neighbour for the limited impact on privacy.
Q&A: Restrictive Covenants Explained
What is a restrictive covenant?
A restrictive covenant is a legal obligation in a property title that restricts how land may be used or developed.
Can a restrictive covenant be modified or removed?
Yes. Under Section 84 of the Law of Property Act 1925, the Upper Tribunal may modify or discharge a covenant in certain circumstances.
What does “practical benefits of substantial value or advantage” mean?
It refers to real, tangible benefits that significantly protect neighbouring landowners’ interests. Minor inconvenience or temporary disturbance is unlikely to qualify.
Does planning permission override a restrictive covenant?
No. Planning permission and restrictive covenants operate separately. Even with planning consent, a covenant may still need to be modified or discharged.
Is compensation always payable?
Not always, but the Tribunal may award compensation where modification causes loss or disturbance to those benefiting from the covenant.
Contact Us
Restrictive covenant disputes can be complex and have significant implications for property development and land value. Our Property Litigation solicitors advise landowners, developers and neighbouring owners on covenant enforcement, modification applications and compensation claims.
If you require advice on a restrictive covenant or are considering development affected by title restrictions, contact Willett & Co Solicitors today for expert, practical guidance.