The court has upheld a restrictive covenant preventing the erection of dwellings in Davies-Gilbert v Goacher and another [2022] EWHC 969 (Ch); [2022] PLSCS 70 – a decision which is of relevance for landowners and practitioners alike.
The claimant owned a significant area of land in the village of East Dean, within the South Downs National Park, which he acquired in 2003 (“the estate”). In 2019, the defendants acquired land in the village which had previously been in common ownership with the claimant’s land and which was subject to a restrictive covenant, imposed in 1960, in favour of part of the estate. The covenant prohibited the construction of any erection, building or wall on the land without the claimant’s written consent, which was not to be unreasonably withheld.
The defendants obtained planning permission for the erection of two dwellings on the land and then sought the claimant’s consent under the covenant. The claimant refused consent because: (a) the scheme would have a detrimental impact on the amenity value of the estate; and (b) it could threaten the future use and commercial value of his neighbouring land. In the same letter he referred to a number of other matters to which he had given “due consideration” in reaching his decision. These included the impact of the proposal on his neighbouring land and on the amenity value of the estate as a whole, and the effect on boundary treatment and maintenance.
The defendants commenced works on site and the claimant sought an injunction to restrain the works. The defendants argued that the claimant’s reasons for refusing consent to the scheme were unreasonable and that his decision-making process had been vitiated by his having taken into account “irrelevant considerations”.
The judge identified the following legal principles:
- The court must identify the actual reason(s) which resulted in the refusal of consent.
- Reasons are the justification for refusal; considerations are the things taken into account. They are not the same thing.
- The process by which the reason was reached and the reason itself must be reasonable: Braganza v BP Shipping Ltd [2015] 1 WLR 1661.
- The decision-maker must, as part of a reasonable process, exclude irrelevant considerations, while taking into account relevant ones.
- The West India Quay principle – whereby if a covenantee makes a decision for a number of reasons, some “good”, others “bad”, the overall decision will remain reasonable provided that there remains at least one “freestanding” good reason – is a sound one.
The claimant’s first reason for refusing consent, the effect of the scheme on the amenity value of the estate, had been affected by an irrelevant consideration – the impact of the scheme on non-benefited land – and so the reason was a “bad” one. However, the claimant’s second reason, the effect of the scheme on the future use and commercial value of his neighbouring land, which did benefit from the covenant, had been arrived at without being influenced by any irrelevant consideration. It was a “freestanding” reason, and one that a reasonable decision-maker in the claimant’s position could have given for refusing consent to the scheme.
Louise Clark is a property law consultant and mediator
