Restrictive Covenants on Land

Restrictive covenants on land play a significant role in regulating the use and development of properties. These legal agreements, often found within property deeds or contracts, impose certain limitations or obligations on landowners and housing developers regarding how they can utilise their properties. Restrictive covenants serve to maintain order and protect the rights of various stakeholders involved in land transactions.

Typically, restrictive covenants dictate what activities can or cannot be carried out on a piece of land. These may include restrictions on building height, architectural style or real estate, land use, or even the prohibition of certain commercial activities. Some restrictive covenants even cover issues such as prohibiting satellite dishes.

While some covenants are straightforward, others may require careful interpretation and legal expertise to fully understand their implications.

Are restrictive covenants on land enforceable?

Restrictive covenants applicable to land are typically enforceable, provided they meet certain legal criteria. These covenants bind the land and not the parties personally, meaning that the covenant ‘runs with the land’.

Primarily, the covenant must be legally sound. It should be precise and clear in its limitations, avoiding excessively broad or unreasonable constraints. Covenants that go against public interest, such as prohibiting all construction on a parcel of land, would not be upheld.

Furthermore, the covenant must be documented in writing and visibly provide a benefit to a specific parcel of land, often referred to as the “dominant tenement.”

This benefit cannot be of a general nature but must be linked to a particular property.

A covenant can be legally broken in various ways. Parties can determine if altering any aspects of your property would result in a breach by checking the Land Registry.

Moreover, land owners should check the Land Charges Register to find out if the covenant was recorded properly in the first instance.

What will happen if I breach a restrictive covenant?

The party that benefits from the restrictive covenant retains the right to initiate legal proceedings against the party found in breach.

Such actions may include seeking injunctions to prevent owners from breaching the covenant further or pursuing compensation for any damages resulting from the breach.

An injunction is a court order that forces you to stop the breach and potentially return the property or the neighbourhood to its original state. For instance, if a structure exceeding height limitations were erected, an injunction might order its removal. Additionally, the covenantee could also seek compensation for any financial loss they suffer due to your breach.

It is often advisable to resolve the dispute before legal action is taken. Open dialogue with the party entitled to the covenant and engaging in negotiation or mediation could lead to a more amicable resolution. This could involve agreeing on changes to the covenant, obtaining consent for the breach retroactively, or reaching a settlement to address the consequences of the breach.

Discharge or modification of a restrictive covenant on land

Removing or modifying restrictive covenants on land can be a complex legal process that typically involves one of the following methods:

Negotiation and Agreement: 

The most straightforward approach is to negotiate with the parties who put the covenant in place to release or modify it. This often involves demonstrating that the covenant no longer serves its original purpose or that removing it would not negatively impact the affected parties.

Negotiation may also include offering compensation to the beneficiaries in exchange for their consent to have the restrictive covenant removed or modified.

Applying to the Upper Tribunal (Lands Chamber): 

If negotiation fails, an application can be made to the Upper Tribunal (Lands Chamber) under Section 84 of the Law of Property Act 1925.

The lands tribunal has the authority to modify or discharge restrictive covenants if it is deemed that the restrictive covenant adversely affects the reasonable use of the land and provides no practical benefit to the beneficiaries.

The applicant must demonstrate that the restriction is obsolete, that it unreasonably restricts the landowner’s use of the property, or that the benefit of the covenant no longer exists.

Indemnity Insurance: 

In some cases, landowners may opt to purchase indemnity insurance to protect against potential losses resulting from breaching the covenant.

This approach does not remove the covenant but provides financial coverage in case the beneficiaries of the covenant take legal action.

Deed of Release: 

If all parties involved agree, a formal Deed of Release can be executed to achieve a release of the covenant. This document must be properly drafted and executed to ensure its legality and effectiveness.

It is important to note that the process of removing restrictive covenants can vary depending on the specific circumstances and legal complexities involved.

Seeking practical advice from a qualified solicitor with experience in property law is highly recommended to navigate the process effectively and ensure compliance with relevant legal requirements.

Additionally, conducting thorough due diligence to understand the implications and potential consequences of removing the covenant is essential before proceeding with any action.

The role of solicitors in restrictive covenants

Solicitors play a crucial role in navigating the complexities surrounding restrictive covenants on land. Their involvement is instrumental at various stages of the process, from initial property transactions to potential enforcement actions or dispute resolutions.

Legal Advice and Due Diligence:

Solicitors provide legal guidance to clients involved in property transactions, ensuring they understand any existing restrictive covenants associated with the land. During due diligence, solicitors thoroughly review property documents and title deeds to identify and assess how the restrictive covenant affects the client.

Interpretation and Compliance:

Solicitors assist clients in interpreting the terms of restrictive covenants and assessing their compliance with legal requirements. This includes determining the extent of the restrictions and advising on how they may impact the client’s intended use or development plans for the property.

Enforcement and Defence:

In cases where a restrictive covenant is breached or challenged, solicitors represent their clients in legal proceedings. This may involve initiating enforcement actions on behalf of the covenant holder or defending against claims of breach brought by other parties.

Alternative Dispute Resolution:

Solicitors explore alternative dispute resolution methods, such as mediation or negotiation, to resolve conflicts related to restrictive covenants outside of court. They advocate for their clients’ interests while seeking mutually acceptable solutions to disputes.

Modification or Removal:

Solicitors assist clients in seeking modification or removal of restrictive covenants through legal channels, such as applying to the Upper Tribunal (Lands Chamber) or negotiating with the parties involved. This may be necessary to facilitate property development or address changing circumstances.

Overall, solicitors play a pivotal role in helping clients navigate the legal landscape surrounding restrictive covenants, ensuring compliance, protecting interests, and resolving disputes effectively and efficiently.

How can Expert Commercial Law assist?

When dealing with restrictive covenants on land, it is important to seek legal advice and assistance. A property litigation team can ensure the right approach is being taken and that applications are being made correctly.

Please note we are not a firm of solicitors. We maintain a panel of trusted and regulated legal experts. If you contact us in relation to a commercial law case, we will pass your case on to a panel firm in return for a fee from our panel firms. We will never charge you for passing on your case to a panel firm.

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