Restrictive Covenants
Discussion
I'm buying my first home and I've just finished reading through the results of the searches that the solicitor has done. There is a restrictive covenant which basically (and pretty unambiguously) says that the property can't be used for any business whatsoever.
Are these sorts of covenants common? i.e. could I have a search done on another property tomorrow and find just as easily that there is no such similar covenant? If I was to start operating a business from the property what would be the implications? As discreetly and considerately as possible of course, but it would be fairly obvious to anyone who paid any attention that there was a business working from the garage, i.e. sign-written van, the odd customer etc. Not particularly disruptive by any means, but obvious..
Who enforces these things? The council I suppose? What powers do they have? Force the business to stop operating from there? Shut it down? Eviction??
Will speak to my solicitor ASAP but that probably won't be until next week. Anything specific I should ask? Is there anything that can be done about getting the covenant removed? Anybody been in / experienced a similar situation?
It could be a deal-breaker for me
Are these sorts of covenants common? i.e. could I have a search done on another property tomorrow and find just as easily that there is no such similar covenant? If I was to start operating a business from the property what would be the implications? As discreetly and considerately as possible of course, but it would be fairly obvious to anyone who paid any attention that there was a business working from the garage, i.e. sign-written van, the odd customer etc. Not particularly disruptive by any means, but obvious..
Who enforces these things? The council I suppose? What powers do they have? Force the business to stop operating from there? Shut it down? Eviction??
Will speak to my solicitor ASAP but that probably won't be until next week. Anything specific I should ask? Is there anything that can be done about getting the covenant removed? Anybody been in / experienced a similar situation?
It could be a deal-breaker for me
Thanks for the replies. Should have said that the property is freehold. Houses are early '70s.
So what I understand now is that for me to be at any risk of being pulled up on the covenant, the "beneficiaries" ("Transferor" is used in the documents I have) need to want to enforce it. It is nothing to do with the council. So my next Q is, Does / Can the beneficiaries include the neighbours?
The RC reads:
Not at any time to exercise or carry on or suffer to be exercised or carried on upon the land hereby transferred or any part thereof or in or upon the dwellinghouse or garage standing thereon any trade business profession or occupation whatsoever but will occupy and use the land and premises hereby transferred for residential purposes only.
Seems pretty unequivocal to me.
The Transferor is some company called The Southern Trust Limited, and the document says that the "rights" pass to any successor company.
Another Q: if they wanted to enforce the covenant, the only thing they can do is sue for their losses - am I right? If that is right then it is unlikely to happen, since the Transferor pressumably nolonger has any interest in the property (or the rest of the estate) since they are (pressumably) all freehold. Their only reason for enforcing this particular coventant would be, as has been mentioned already I think, that a business being run from the property could affect the value of the others which they were trying to sell (40 years ago).
Have I understood all this correctly? I'll speak to my solicitor about it all but your info and experiences is just as useful, Ta
ETA: oh, and the silliest covenant is something about no caravans, boats or other vessels
although I think it also mentions trailers... will have to check that one out too 
So what I understand now is that for me to be at any risk of being pulled up on the covenant, the "beneficiaries" ("Transferor" is used in the documents I have) need to want to enforce it. It is nothing to do with the council. So my next Q is, Does / Can the beneficiaries include the neighbours?
The RC reads:
Not at any time to exercise or carry on or suffer to be exercised or carried on upon the land hereby transferred or any part thereof or in or upon the dwellinghouse or garage standing thereon any trade business profession or occupation whatsoever but will occupy and use the land and premises hereby transferred for residential purposes only.
Seems pretty unequivocal to me.
The Transferor is some company called The Southern Trust Limited, and the document says that the "rights" pass to any successor company.
Another Q: if they wanted to enforce the covenant, the only thing they can do is sue for their losses - am I right? If that is right then it is unlikely to happen, since the Transferor pressumably nolonger has any interest in the property (or the rest of the estate) since they are (pressumably) all freehold. Their only reason for enforcing this particular coventant would be, as has been mentioned already I think, that a business being run from the property could affect the value of the others which they were trying to sell (40 years ago).
Have I understood all this correctly? I'll speak to my solicitor about it all but your info and experiences is just as useful, Ta
ETA: oh, and the silliest covenant is something about no caravans, boats or other vessels
although I think it also mentions trailers... will have to check that one out too Edited by bulb763 on Thursday 10th March 12:55
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