Restrictive Convenant
Discussion
A property I am looking at has a restrictive covenant in place (from circa 1975). This covenant applies to part of the land and states:
"FOR the benefit of each and every part of the Vendors adjoining or adjacent land the Purchasers hereby covenant for themselves and their successors in title not to erect any buildings on the land
hereby conveyed."
The is no obvious reason for this - the property is in the middle of nowhere - no neighbours - overlooking farmland.
There are other hurdles I would have to overcome to develop as I would like (the property is in an AONB) but have a high degree of confidence that this will not be an issue - based on recent planning history for this and similar properties in the area, however the covenant would be a problem (it would mean smaller extension and probably no detached garage - not very PH at all).
So...how enforceable would such a covenant be? I understand for it to be enforceable, it must be deemed to be reasonable. If it makes any difference, the original vendor named in the covenant is very much alive and well, no longer local to the area and a fairly prominent peer.
"FOR the benefit of each and every part of the Vendors adjoining or adjacent land the Purchasers hereby covenant for themselves and their successors in title not to erect any buildings on the land
hereby conveyed."
The is no obvious reason for this - the property is in the middle of nowhere - no neighbours - overlooking farmland.
There are other hurdles I would have to overcome to develop as I would like (the property is in an AONB) but have a high degree of confidence that this will not be an issue - based on recent planning history for this and similar properties in the area, however the covenant would be a problem (it would mean smaller extension and probably no detached garage - not very PH at all).
So...how enforceable would such a covenant be? I understand for it to be enforceable, it must be deemed to be reasonable. If it makes any difference, the original vendor named in the covenant is very much alive and well, no longer local to the area and a fairly prominent peer.
Presumably he didn't want the area spoling with a new build of houses or other structures. My new house has the same type of restriction that I can't erect a brick building on the rear garden.
The previous owners purchased this land from the neighbour, who sold it to them to prevent a builder from acquiring it and developing new houses. Fair enough in my opinion.
Not sure how you can tackle it though.
The previous owners purchased this land from the neighbour, who sold it to them to prevent a builder from acquiring it and developing new houses. Fair enough in my opinion.
Not sure how you can tackle it though.
These sorts of restrictive covenants are rarely enforced, but that's not to say that they couldn't be, and I can't see any real argument against it on the grounds of 'reasonableness' - you would be buying the property in full knowledge of the covenant and the restrictions it placed upon future development and use of the land.
You said the original vendor is alive but no longer local? Does he still own adjoining or adjacent land (relevant, because this is what the covenant is stated to be to the benefit of). My (limited) undertanding of the law behind covenants is that they can only be effectively enforced by the person who implemented them (or their heirs or estate).
Depending on the current vendor's relationship with the adjacent landowners, you might want to have a quiet word with them and ask if they object to the works you are proposing.
Failing that, it is possible to take out insurance against the potential enforcement of such restrictive covenants, but it won't be cheap: obviously the cost will be based on the likelihood of the covenant being enforced and the cost of reinstating the property (ie. demolishing any development you have implemented).
Since it's a property you are only looking at buying, you might wish to get a quote for such insurance and then negotiate the cost of purchase accordingly. If you were being really cheeky, you could even agree purchase subject to both insurance against the covenant being implemented and (since you're on a fairly sticky wicket with Planning in an AONB, anyway) Planning Permission being sought by yourself and granted prior to completion.
You said the original vendor is alive but no longer local? Does he still own adjoining or adjacent land (relevant, because this is what the covenant is stated to be to the benefit of). My (limited) undertanding of the law behind covenants is that they can only be effectively enforced by the person who implemented them (or their heirs or estate).
Depending on the current vendor's relationship with the adjacent landowners, you might want to have a quiet word with them and ask if they object to the works you are proposing.
Failing that, it is possible to take out insurance against the potential enforcement of such restrictive covenants, but it won't be cheap: obviously the cost will be based on the likelihood of the covenant being enforced and the cost of reinstating the property (ie. demolishing any development you have implemented).
Since it's a property you are only looking at buying, you might wish to get a quote for such insurance and then negotiate the cost of purchase accordingly. If you were being really cheeky, you could even agree purchase subject to both insurance against the covenant being implemented and (since you're on a fairly sticky wicket with Planning in an AONB, anyway) Planning Permission being sought by yourself and granted prior to completion.
Covenants don't have to be reasonable, or even sane - they're a legal agreement that if you buy the land you have to abide by whatever conditions the original or subsequent owners care to dream up. If they only want to sell to you on the condition that you paint your feet blue, they can do so - it's your choice to buy or not. Often, as in the case on our land, they're introduced when the vendor doesn't want to see someone buy the land and profit unduly by building a bigger property or multiple houses on the site.
I'm not sure how it works, but you may be able to talk to the originator of the convenant to have it amended. They may want a fee to do so. Of course that does alert them to the fact that you're planning to do something. Essentially though, they've got you to ransom - they can at any point decide to make you either take down offending buildings or demand a payment. It's amazing how people hear about things through the grapevine, so you'd be optimistic not to expect them to hear about it. If they're dead or living in another country you might have a chance.
I'm not sure how it works, but you may be able to talk to the originator of the convenant to have it amended. They may want a fee to do so. Of course that does alert them to the fact that you're planning to do something. Essentially though, they've got you to ransom - they can at any point decide to make you either take down offending buildings or demand a payment. It's amazing how people hear about things through the grapevine, so you'd be optimistic not to expect them to hear about it. If they're dead or living in another country you might have a chance.
If the covenant restricts the erection of any building, was it imposed before or after the existing house was put up? If before, obviously you should check carefully that there is consent for the present house. People simply say, "insure" but that won't be much help if the beneficiary of the covenant obtains an injunction compelling you to demolish it!
However, if the wording is exactly as you say, I would suggest that it does not restrict extending an existing building. Take some proper legal advice, then negotiate/argue with the beneficiary. Also, a detached garage which is ancillary to the main house may (and I stress: may) not be construed as a separate building. That's rather less clear cut, though.
ETA: just re-read your post (why doesn't PH allow you to see the thread as you type your reply?) and noticed the covenant only affects part of the land. Can you put your garage on the part which isn't affected?
However, if the wording is exactly as you say, I would suggest that it does not restrict extending an existing building. Take some proper legal advice, then negotiate/argue with the beneficiary. Also, a detached garage which is ancillary to the main house may (and I stress: may) not be construed as a separate building. That's rather less clear cut, though.
ETA: just re-read your post (why doesn't PH allow you to see the thread as you type your reply?) and noticed the covenant only affects part of the land. Can you put your garage on the part which isn't affected?
Edited by SJobson on Monday 28th December 09:40
I've had to deal with restrictive covenants in terms of developing park land into more modern leisure and disability friendly public areas and most of the time they are not enforced. That said if some busy body gets hold of it and doesn't like what you are doing it can be a b*stard long process to sort out. Depending on the age of your covenant you can often 're-interpret' the greyer areas of it.
The standard answer a developer would use would be to inusre the covenant. The critical thing is that you DO NOT take any steps to contact the beneficiary. Most policies will only come into force after planning and the insurers will want to see all objection letters. Premiums tend to be circa 0.05% of the sum insured although this will go up as the value insured goes down.(The last one I insured was in December and £10m risk + £1m consequential loss) was insured for £8000. I would speak to your solicitor. First Title tend to be pretty reasonable in cost terms.
Remember that Insurance is not a Panacea, it will pay out to cover a claim but as a rule will only cover lost WIP and legal fees plus any compensation. profit is not usually covered, nor are the costs of delay.
The beneficiary of the covenet has a number of remedies available to him/her including an injunction to prevent you from building.
In reality few claims are made on this type of insurance, but without it you may have problems with your mortgage company and with selling on. I have probably taken out over a hundred of this type of policy in the last 15 years and have only claimed on one. As a matter of interet, the one that I had to claim on, resulted in the development never being built past 1st floor, and all work to date being taken down. No profit was made, and the cost in terms of opportunity cvost and time was enormous.
Remember that Insurance is not a Panacea, it will pay out to cover a claim but as a rule will only cover lost WIP and legal fees plus any compensation. profit is not usually covered, nor are the costs of delay.
The beneficiary of the covenet has a number of remedies available to him/her including an injunction to prevent you from building.
In reality few claims are made on this type of insurance, but without it you may have problems with your mortgage company and with selling on. I have probably taken out over a hundred of this type of policy in the last 15 years and have only claimed on one. As a matter of interet, the one that I had to claim on, resulted in the development never being built past 1st floor, and all work to date being taken down. No profit was made, and the cost in terms of opportunity cvost and time was enormous.
SJobson said:
People simply say, "insure" but that won't be much help if the beneficiary of the covenant obtains an injunction compelling you to demolish it!
That's a fair comment, but you do need to take into account their motivation.It is extremely rare for such covenants to be enforced when the person who originally implemented them no longer has any interest in the land to which they benefit. You have to remember that enforcement of the covenant would take a lot of trouble and legal costs and would result in no financial benefit to the person who implemented it - the best he is going to achieve is to force you to demolish the 'illegal' development; he's not going to get any compensation (possibly not even his legal costs).
And my understanding is that the enforcement of such a covenant by the beneficiary (ie. the person who now owns the land) can get very messy since, as richyb says, you can get into long, drawn-out bickering over re-interpretation of the original intention of the covenant.
And of course the purpose of the insurance is to ensure that you don't end up out of pocket if you are forced to demolish, so in that respect it does help - rather a lot!
... but unless you desperately want to own this particular property, the safest and easiest course of action is to simply walk away.
UpTheIron said:
"not to erect any buildings on the land hereby conveyed."
Definition-wise, is an extension the same as a building? You could argue that the covenant is aimed at preventing the construction of new buildings, whilst an extenion is simply an attachment to an existing building. The number of buildings on the plot remains the same.SJobson said:
I would suggest that it does not restrict extending an existing building. Take some proper legal advice...
That is my plan. If I can only extend up to the edge of the land specified in the covenant then it wouldn't be the end of the world anyway.SJobson said:
Can you put your garage on the part which isn't affected?
That is an option, but less likely due to the location it would have to be in to get around the covenant would be on dodgy ground from a planning perspective IMHO. An underground garage perhaps? 
To answer a few other queries...the house was present before the covenant was put in place (c1900 house, 1975 covenant), and the property has changed owners several times since then. The originator of the covenant is still alive. I can see no logical reason for an objection to what I want to do, but that's not necessarily the point is it.
There is already PP in place to extend the property to close to the "boundary" of the land specified in the covenant, but I would want to go several feet further. To put this in perspective, we are talking about a 20ft extension rather than a 12ft extension...nothing huge.
It's still early stages (not made an offer for the property yet!), but if I can make the changes I want then it is "dream home" material, or at least as close as I am going to get in this part of the country on my meagre income!
I'll keep you guys informed, thanks for the feedback so far.
Simpo Two said:
UpTheIron said:
"not to erect any buildings on the land hereby conveyed."
Definition-wise, is an extension the same as a building? You could argue that the covenant is aimed at preventing the construction of new buildings, whilst an extenion is simply an attachment to an existing building. The number of buildings on the plot remains the same.Whether you walk away or not, as has been suggested depends on your financial position and your attitude to risk. A 1970's covenet is more likely to be enforced than a 1920's one as the beneficiaries are more likely to be around.
Vron said:
Building in an AONB is impossible. We couldn't even rebuild existing delapidated buildings on our land as it was designated an AONB. The Planner said he would rather see them fall down.
No its not! I have done countless developments in the Cotswolds AONB from single plots to small estates. Also I am here typing in my study which is a 2 year old extension to my house. The house is in AONB and a conservation area. It took me 8 weeks to get consent at delegated level.
You need to present a coherent argument that anticipates the Planning Officer's issues and concerns and addresses all of the relevant policy issues. If you can't do that yourself then I can recommend a good planning consultant (not me, but the one I use for all my development work). PM me if you need details of the Consultant.
edited to fix the worst of the typo's
Edited by blueg33 on Monday 28th December 13:40
Vron said:
We sold the property in 2007 with the outbuildings in the same state as when we bought in 2000. I am only repeating what the planner said when he visited us on site about it being an AONB and rebuilding.
Then either the Planner was talking b
ks (it happens a lot...) or you're not telling us the full story.For a start, if you were only repairing dilapidated outbuildings to their original state, you wouldn't need planning permission, anyhow.
If, on the other hand, you were trying to 'rebuild' the crumbled foundations of a set of outbuildings into a group of new dwellings, it would have probably been filed under 'taking the piss' and turned down flat...
Part of my job in a former life was working for the Building Control department of a Local Authority (in your neck of the woods, as it happens, Vron), giving advice to the Planners on when 'conversion' or 'rehabilitation' works crossed the line to become 'demolition and new build'. The latter wasn't necessarily forbidden, but we tended to take a far more helpful view if people were honest with us instead of thinking we were stupid enough to fall for such a basic and obvious trick.
Sam_68 said:
Vron said:
We sold the property in 2007 with the outbuildings in the same state as when we bought in 2000. I am only repeating what the planner said when he visited us on site about it being an AONB and rebuilding.
Then either the Planner was talking bks (it happens a lot...) or you're not telling us the full story.For a start, if you were only repairing dilapidated outbuildings to their original state, you wouldn't need planning permission, anyhow.
If, on the other hand, you were trying to 'rebuild' the crumbled foundations of a set of outbuildings into a group of new dwellings, it would have probably been filed under 'taking the piss' and turned down flat...
Part of my job in a former life was working for the Building Control department of a Local Authority (in your neck of the woods, as it happens, Vron), giving advice to the Planners on when 'conversion' or 'rehabilitation' works crossed the line to become 'demolition and new build'. The latter wasn't necessarily forbidden, but we tended to take a far more helpful view if people were honest with us instead of thinking we were stupid enough to fall for such a basic and obvious trick.
Vron said:
I don't know what you mean by my 'neck of the woods' but the property I am talking about was in south lincolnshire in an AONB.
I meant Yorkshire, since that's where you list as your location on your profile. The rules (both written and unwritten) are pretty much the same everywhere, though.I'm actually quite surprised that you managed to find an AONB in Lincolnshire. What was Outstanding about it - Outstandingly flat and featureless, was it?
What you, and the rest of the general public perhaps don't fully appreciate is that Planning Officers - or even Planning Authorities - don't have arbitrary powers over what can or can't be built in their area.
They certainly can't just tell you informally that they won't allow it and will not accept an application. They areobliged to determine any valid application that is set before them; I could submit a Planning Application to demolish Stonehenge and build a Pizza Hut in its place and they would have to determine it, provided the paperwork was in order (though in the case of Stonehenge it would obviously be a fairly straightforward and valid refusal, which would be upheld at appeal).
All applications should be determined by measuring them against national and adopted local policies, however, and if they refuse an application, they must give reasons for the refusal. If those reasons don't stand up to scrutiny, a competent Planning professional would stand every chance of getting the decision overturned at appeal.
You will find that the majority of Local Authorities have an Adopted Policy that deals with development in AONB's, and provided the proposal is in line with that Policy, there is no reason it should be refused. I can pretty much guarantee that there won't be a Local Policy anywhere that completely prohibits development in an AONB (because it would contravene national planning law and policy and hence wouldn't have been signed-off for adoption).
HTH
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