What is a Restrictive Covenant?

Restrictive covenants play a crucial role in property law, shaping how land and property can be used and developed. This article is an overview of what they are and what they mean for property owners.

What is a Restrictive Covenant?

A restrictive covenant is a promise that land will not be used in a certain way for the benefit of other land. Typically, they impose limitations on the use and development of property, such as building restrictions or land usage constraints. Examples include limiting what land is used for – e.g., residential use only, limiting the number of buildings, prohibiting trade or business, banning certain livestock, and preventing causing a nuisance.

Enforcing a Restrictive Covenant

If a restrictive covenant is not complied with, the owner of the land, with the benefit of it, can seek to enforce it. Enforcing these covenants can involve legal action, such as court proceedings for an injunction, damages, or a restoration order. A court can make an order requiring the covenant to be obeyed and to stop a person from using their land in a way that the covenant does not allow.

Modifying and Discharging Restrictive Covenants

Restrictive covenants can be extinguished, i.e. terminated, through mutual agreement, expiration of specified time periods, or a court order.

If there is mutual agreement, then the parties can enter into an agreement (known as a Deed of Express Release). This Deed would then need to be sent to the Land Registry for the restrictive covenant to be removed from the affected property titles.

If there is no mutual agreement, then one party can apply to the Upper Tribunal (Lands Chamber) for the restrictive covenant to be removed. There are certain grounds that can be relied upon for a modification or extinguishment application, such as that the restriction is now obsolete or that the covenant in its present form impedes a reasonable use of the land. Some of these grounds are easier to succeed upon than others.

Risks of Breaching Restrictive Covenants (Fosse Urban Projects Ltd v Whyte)

The case of Fosse Urban Projects Ltd v Whyte highlighted the importance of adhering to restrictive covenants and the risks associated with breaching them. The case involved a breach of a restrictive covenant that prohibited the construction of certain structures on a property. Whilst waiting for the outcome of an application to discharge the restrictive covenant, Fosse proceeded with building works on the land, which were completed before the court made its decision. This meant that Fosse was in breach of the restrictive covenant. The court refused the discharge application due to the ‘cynical’ approach taken by Fosse.

The court’s decision underlined the legal repercussions of violating such covenants, as it resulted in injunctions to stop the non-compliant activities and potential liability for damages. This case serves as a cautionary example, emphasising the need for property owners and developers to carefully review and comply with restrictive covenant terms to avoid a possible injunction and/or claim for damages.

Contact our property disputes team today

Understanding how restrictive covenants can be enforced and the risks of breaching them is essential for property owners and developers. By obtaining early advice, parties can protect their interests, comply with legal obligations, and mitigate potential disputes or liabilities related to restrictive covenants.

We can help guide you through this by advising on the existence and meaning of restrictive covenants that affect your property. We can assist with preparing the necessary paperwork to document an agreement to remove or vary a covenant and to amend the title documents at the Land Registry.

In addition, our dispute resolution team are on hand to assist if action is needed to remove or modify a covenant via the Tribunal, if you want to enforce a covenant or if you are facing enforcement action.

Navigating the intricacies of restrictive covenants and resolving disputes can be challenging. If you have any questions or would like advice on restrictive covenants, please contact our specialist Property Disputes team by using our online enquiry form, calling 0330 404 0768, or contacting our team directly at Annabel.Mayer@ashtonslegal.co.uk and Kirsteen.Durrant@ashtonslegal.co.uk.