A covenant preventing alteration to the external appearance of buildings is capable of securing practical benefits of substantial value or advantage to those benefiting from it under section 84 of the Law of Property Act 1925.
The Upper Tribunal (Lands Chamber) has dismissed an application to modify a building scheme in Patel and others v Spender and others [2024] UKUT 62 (LC).
The case concerned 11 three-storey freehold houses on Ferry Street in London’s Docklands which formed part of the St David’s Square development, a mix of 40 freehold houses and 436 leasehold flats. The development had a noticeable architectural signage of yellow and darker brickwork, curved “waveform” roofs, laminate panelling and roof slates, which created a pleasing consistency.
Each property was burdened by a covenant – enforceable by all other owners of property in the development – not to add or alter it in any way which substantially affected its external appearance. Any rebuilding had to conform with the building it renewed or replaced as far as reasonably possible.
The applicants wished to extend the living accommodation into the roof space and create full-width dormer extensions and to extend their ground floors. Most did not require planning permission. Their application to modify the alterations covenant focused on section 84(1)(aa), suggesting that the covenant impeded a reasonable use of the land. A total of 104 owners of other properties in the development objected to the proposals, as did the freeholders of the leasehold estate.
The tribunal was satisfied that the covenant impeded a reasonable use of the applicants’ properties, so did the covenant secure practical benefits to the objectors? Some of the properties were licensed HMOs but this did not breach the covenant, so preventing increased nuisance from the permitted occupants of those HMOs was not a benefit secured by the covenant. Neither was preventing additional strain on estate services and the service charge by an increase in residents, damage to trees or additional overlooking from new balconies.
However, the works would substantially change the external appearance of the application properties. The difficulties of carrying out all the works at the same time and ensuring that the properties were altered in a consistent way meant there was a likelihood of piecemeal changes in their appearance. This would lead to a well-thought-out development with a very unified appearance becoming incoherent and gappy.
Preventing that scenario was a practical benefit of substantial advantage to the objectors, as was the avoidance of the thin-end-of-the-wedge argument, preventing even further erosion of the design and character of the estate. The tribunal had no jurisdiction to modify the covenant.
Louise Clark is a property law consultant and mediator
