We examine restrictive covenants and their use. They are usually used to restrict what a buyer can do with a property, though some have passed their date of usefulness.
Restrictive covenants are used by landowners to stop certain acts being carried out on their land. These are usually implemented when the person selling the land wants to restrict what the buyer can do on it.
My property has a restrictive covenant-what does that mean?
A restrictive covenant can prevent owners from changing certain aspects of their
property as they are written into the property deeds.
They can cover a wide variety of issues
but most lean towards:
- Preventing homeowners from altering a property (e.g. a building extension, house conversion);
- Restricting any buildings or other large structures from being built on the land; or
- Blocking businesses from operating on the land.
If you are looking to make changes to your property, it’s always worth looking at the land deeds to make sure that your changes follow any stated stipulations.
Why are restrictive covenants used?
Restrictive covenants tend to be used to ensure that certain standards are being upheld by the residents of the property, and housing developers will often add these covenants to a Transfer Deed to stop any work that has the potential to negatively impact the neighbourhood.
This isn’t only related to structural work, however, as it can also include aesthetic items such as no satellite dishes on the front of the house, parking any towable vehicles in the front garden, and not allowing the garden to become overgrown.
Even if you own a freehold property, you still will have to follow a covenant if one is in place. With period homes, these are usually implemented to protect the look of the building and to minimise damage to historical structures but with newer homes, they can allow the housing developer to maintain some sort of control over the homeowners.
Restrictive covenants aren’t always a bad thing though, as they can block your neighbour from making changes to their own house that could affect the value and quality of your own land.
Can I remove or change a restrictive covenant?
While a covenant can impact the use and enjoyment of the land for a long time, they don’t have to be permanent. There are different ways that a covenant can be broken legally, and by checking the Land Registry documents you can see if changing any aspects of your land would breach it.
Checking who the beneficiaries of the covenant are and reading the whole Deed clarifies if the covenant is tied to the land or is a personal one. If so, that restrictive covenant is not tied to the land, but to the occupant/s at the time the covenant was written.
Checking back through a property’s history may also uncover if it has been removed previously. If the beneficiary of the covenant can be identified, you can either negotiate a release of the covenant or a variation of the deed containing the covenant and this will then be registered with the Land Registry.
There are certain criteria that a restrictive covenant must meet in order to still have a useful purpose. If you believe that the one on your property no longer has a function, you can potentially challenge it through the Lands Tribunal. Your solicitor will check whether any of the grounds contained in section 84 of the Law of Property Act 1925 can form the basis of a claim.
The Upper Tribunal can discharge or modify the restrictive covenants if:
- The restriction is deemed obsolete as a result of ‘changes in the character of the property or the neighbourhood or other circumstances’ (LPA s.84(1)(a)). This is usually the case where the wording of a covenant no longer applies to the present circumstances; or
- The restriction impedes the reasonable use of the land (LPA s.84(1)(aa)); or
- By agreement with the beneficiary of the restriction (LPA s.84 (1)(b)).
It can take a long time to get a restrictive covenant removed and it depends on whether the application is disputed, the timeframe usually being between 18 and 24 months.
Will having a restrictive covenant affect my sale?
The presence of restrictive covenants can give rise to additional queries.
A common approach to dealing with restrictive covenants, particularly where the beneficiary of the covenant cannot be identified, is to obtain indemnity insurance against the risk of the restrictive covenant being enforced. This insurance will protect the owner of the house, mortgage providers and usually the successors in title and will cover the costs in relation to the enforcement of the covenant.
Your conveyancing solicitor can assist with this during the sale of your property.
Legal help with your restrictive covenant
If you require any advice about a restrictive covenant, whether as a buyer or as a seller, please contact Cunningtons solicitors’ litigation department. We have extensive experience of a wide range of property law issues, including misrepresentation and restrictive covenants, and would be happy to advise.