Covenant made in 1929 restricting use to “working class” dwellings — Covenant limited to duration of family settlement over adjoining land — Developer successor to covenantor claiming covenant unenforceable — Whether adjoining land still settled for purpose of covenant — Whether covenant capable of benefiting adjoining land — Whether precision of wording lost with passage of time — Claim by developer allowed
By a deed executed on 26 July 1889 (the 1889 settlement), land in Chelsea comprised in the Cadogan family estates was settled on trust for various members of the Cadogan family. By a conveyance dated 27 May 1929, a substantial plot of the land so settled was sold to the local authority (the council). The plot included a corner site (the Beehive site) that, as recited in the conveyance, had been let in the previous year for the purpose of building a public house*. Under the terms of the conveyance, the council covenanted with the vendor, as owner of the property adjoining or neigbouring the plot, that “so long as such adjoining or neighbouring property or any part thereof forms part of the Cadogan Settled Estate in Chelsea but not further or otherwise [the plot or any buildings thereon should not be used] for any purpose whatsoever except for the housing of the working classes…”.
By various documents executed in March and June 1961, the trustees of the 1889 settlement were discharged, and the beneficial interests thereunder were vested in a number of private companies. The companies were to be owned and controlled by the trustees of a new Cadogan family settlement (the 1961 settlement). Save for the Beehive site, the land conveyed to the council was, in due course, developed by a housing charity. Following the closure of the public house, the council sold the Beehive site to the claimant, which obtained planning permission for the demolition of the public house and the construction of four private houses. The claimant sought a declaration that the Beehive site was free from the 1929 restrictive covenant. The claim was opposed by the eighth Earl and three Cadogan Estate companies.
Held: The declaration was granted.
1. On a proper construction of the covenant, the defendants’ properties had, in March 1961, ceased to be “part of the Cadogan Settled Estate” as understood by the parties to the 1929 conveyance. This expression could not be taken to mean land that continued thereafter to be land in which a member of the Cadogan family continued to have a legal or equitable interest. Once the condition subsequent had been broken, the restrictive covenant was spent, and could not be revived by subjecting the land to new trusts benefiting members of the Cadogan family†.
2. So long as the adjoining land formed part of the 1889 settlement, it could not be doubted that that land benefited from the covenant. Applying the words of Brightman J in Wrotham Park Estate Co Ltd v Parkside Homes Ltd (1974) 229 EG 617, it was not necessary for the defendants to prove that the covenant did in fact benefit the adjoining or neighbouring land. Where the owner of retained land saw fit to impose a restriction, the court would normally assume that it was imposed for the benefit of the land. The covenantor was then bound, at the very least, to show that the estate remaining in the covenantee at the date of the action was not intended to be so protected, or that it could not possibly be hurt by a breach of the covenant. On the evidence before the court, it was reasonable for the defendants to claim that the covenant was capable of benefiting their properties, even though others might reasonably argue to the contrary.
3. The claimant could not contend that it was not possible, at the present time, to say what, if anything, was meant by “the working classes”. It was common ground that the expression: (a) no longer carried the meaning that it bore at the time of the 1929 conveyance (people doing manual work for a weekly wage); and (b) was intended, displacing the presumption normally applicable to the interpretation of contracts, to bear a meaning that would reflect, from time to time, economic and social changes within society. The context was a transfer of land to a local authority for the provision of affordable housing. There was accordingly no difficulty in conferring a similar meaning, namely the use of property for the housing of those who, by virtue of their low incomes, might find it difficult to purchase or rent suitable and appropriate accommodation in the private sector: Guinness Trust (London Fund) Founded 1890, Registered 1902 v Green [1955] 1 WLR 872 and Re Niyazi’s Will Trusts [1978] 1 WLR 910 applied.
4. Even if the suggested meaning could not be adopted, it was possible, even in present times, to identify some persons who would definitely, at one extreme, fall within the expression, and, at the other, definitely fall outside it. There was no reason why enforcement should depend upon the ability to identify in advance each and every person whose occupation would infringe the covenant.
* Editor’s note: Later to trade as the Rat and Parrot.
† Editor’s note: The remaining holdings (adverse to the claimant) did not accordingly affect the outcome.
Michael Barnes QC and Rupert Reed (instructed by Gouldens) appeared for the claimant; Elizabeth Appleby QC and Toby Davey (instructed by Pemberton Greenish) appeared for the defendants.
Alan Cooklin, barrister
