Restrictive covenant – Modification – Section 84(1)(aa) and (c) of Law of Property Act 1925 – Covenants restricting development, use and density to three detached private dwellings – Applicant seeking modification to permit 83-bed care home – Neighbours objecting to proposed development – Whether restriction having practical benefit of substantial advantage to objectors – Whether proposed modification injuring objectors as persons entitled to benefit of restriction – Application dismissed
The applicant was an established provider of high-quality private care homes for the elderly. It wished to build and operate a new care home at a site at 270-274 London Road, St Albans which it acquired between November 2016 and April 2017 following the grant of planning permission on appeal on 24 May 2016. The planning permission allowed the construction of the care home and associated landscaped gardens and 36 on-site parking spaces for visitors and staff. It was intended the care home would be of about 62,000 sq ft and that the building footprint would occupy approximately 36% of the 1.5 acre site. It would accommodate about 80 residents in 83 suites and studios and employ about 70 full-time equivalent staff. The building itself would be part two-storey and part three-storey and would include a specialist wing providing care for residents affected by dementia. The average age of the residents of the appellant’s other care homes was about 85 and their average stay was less than 2.5 years.
The appellant was prevented from implementing the planning permission and building its new care home by covenants imposed in a number of conveyances of parts of the site in 1910 which restricted the use and density of development of the site and which benefitted the objectors who were the owners and occupiers of 13 of the 18 detached houses adjoining or close to the appellant’s site at London Road, Mile House Lane and New House Park, St Albans.
In September 2017, the appellant failed in proceedings in the High Court in which it sought a declaration against the objectors (and others) that the restrictive covenants were unenforceable: Signature of St Albans (Property) Guernsey Ltd v Wragg [2017] EWHC 2352. On 9 January 2018 the appellant issued an application under section 84(1)(aa) (under first limb of s.84(1A) that no practical benefit of substantial advantage to objectors) and (c) (proposed modification would not injure the objectors) of the Law of Property Act 1925, by which it sought the modification of the covenants sufficiently to enable it to implement the planning permission and undertake its proposed business from the site.
Held: The application was dismissed.
(1) It was common ground that in the context of section 84(1) of the Act, the implementation of the planning permission would constitute a reasonable use of the appellant’s land, and that that use would be impeded unless the restrictions were modified. It was also agreed that the restrictions secured to the objectors’ practical benefits in terms of preserving the outlook from their properties, in preventing overlooking, and in maintaining privacy. The critical issue was whether those acknowledged practical benefits were of substantial value or advantage to the objectors.
(2) In planning terms, the effect of the restrictions was to confine the use of the land to class C3 (dwellinghouses), whereas the proposed use would fall within C2 (residential institutions). There was no provision within the general development order for such a change of use, and the fact that that change would require planning permission was indicative of the difference in the nature of the two uses. A C2 use included a wide variety of uses, for instance hospitals, barracks, nursing homes etc, all of them institutional in nature and, on any basis, different from private family houses with large gardens.
(3) Having inspected the application land and viewed it from the objectors’ properties, the tribunal considered that the proposed development would affect the amenity of the majority of the objectors to a significant degree, and had no hesitation in concluding that the ability to prevent the development of the site as proposed was a practical benefit of substantial advantage to most objectors. The implementation of the appellant’s proposals would have a much greater adverse impact on the amenity of the objectors than the construction of three or five detached houses on the site, which was the likely alternative use if the present application was unsuccessful. Domestic property would be on a smaller scale and would be occupied in a manner which was comparable to the use the objectors made of their own properties; it would also lack the elements of uniformity and the institutional character of the proposed development. While the privacy and outlook enjoyed by the objectors could be compromised to a degree, compared to their current levels, by the full or partial implementation of the 2013 planning permission, the consequential changes would be on nothing like the same scale as the appellant’s care home. Given the appellant’s proposed client group and their intention to create a calm environment, it was unlikely that the objectors’ fears over noise, deliberate interference with privacy, and even “stranger danger” would prove to be intrusive features in their own right, but low level noise and the presence of a large number of people in close proximity to the objectors’ gardens would be likely to contribute to the experience of living next to an institution rather than in an exclusively domestic setting.
(3) Having reached the conclusion that the ability to prevent the development of the adjoining land on the scale and for the purpose proposed by the appellant was of substantial benefit to the objectors, it was not necessary to consider the valuation evidence which sought to quantify that benefit in monetary terms. The conclusion as to substantial advantage was sufficient to dispose of the application under the first limb of s.84(1A). It followed that the applicant’s reliance on ground (c) (the proposed modification would not injure the person entitled to the benefit of the restriction) also failed.
Martin Hutchings QC (instructed by Hill Dickinson) appeared for the applicant; Patrick Rolfe (instructed by Child & Child) appeared for the objectors.
Eileen O’Grady, barrister
Click here to read a transcript of Signature of St Albans (Property) Guernsey Ltd v Wragg and others
