Restrictive covenant – Modification – Section 84(1)(aa) and (c) of Law of Property Act 1925 – Applicants obtaining planning permission for extension to house on estate – Covenant restricting extensions or external alterations – Applicants seeking modification of restrictions — Whether covenant securing practical benefits of substantial value or advantage – Application dismissed
The applicants were the freehold owners of 7 Coach House Lane, London N5, a three-storey mews house constructed in 1991. It formed part of a small development of 18 similar houses situated on land formerly used as gardens and a coach house.
In July 2020, the applicants received planning consent for the construction of a ground floor extension of 7.4 sq m, adjacent to the south eastern elevation and occupying the site of a path which provided access to the rear garden of the property. The proposed extension, although small, would allow the applicants to reconfigure the interior of their house and provide better use of the floorspace for their expanding family.
The freehold owners of the properties on the development benefited from a covenant which prevented the erection of, or material alteration or addition to the external appearance of any buildings, walls, fences or other structures.
The applicants applied to the Upper Tribunal for the modification of the restrictions on grounds (aa) and (c) of section 84(1) of the Law of Property Act 1925 to permit the construction of a single-storey side extension on the property in accordance with the planning consent.
The owners of other properties on the estate and the management company owned by them objected to the modification arguing that the covenant provided certainty, insofar as all residents were aware that the external appearance of their homes could not be altered. Further, it ensured the continuance of the visual uniformity of the original design and prevented the setting of precedents for modification, the so-called “thin end of the wedge”.
Held: The application was dismissed.
(1) The question whether the proposed extension would disrupt that aesthetic of the estate was highly subjective. The property was already larger than the other houses in the same terrace. The extension was small and occupied a site which was to some extent screened by shrubs. But the extension was not sympathetic to the design of the original building, the terrace as a whole as well as the setting of the adjoining conservation area. Although the estate’s design ethos could be characterised as cohesive rather than uniform, the extension would harm its visual appeal.
It was obvious that the restriction secured a practical benefit to the objectors since it was the means by which the original appearance of the estate could be preserved and, in this case, prevented the implementation of the planning permission. But the question was whether that was a benefit of substantial value or advantage within section 84.
(2) As regards the so-called “thin end of the wedge” issue, any application under section 84(1) had to be determined upon the facts and merits of the particular case, and the tribunal was unable to bind itself to a particular course of action in the future in a case which was not before it. However, it was legitimate in considering a particular application to have regard to the scheme of covenants as a whole and to assess the importance to the beneficiaries of maintaining the integrity of the scheme: Shephard v Turner [2006] EWCA Civ 8; [2006] 2 EGLR 73 considered.
Whilst the objectors in the present case might genuinely believe that modification was the first step on a path to the complete erosion of the design ethos that had underpinned the appearance of the estate, regardless of the outcome of this application, the restriction would continue to bind every other house in the estate, and would continue to bind the property itself in its modified form. Applications of this type were fact sensitive, and it could not be assumed that the outcome of one case would be mirrored in the outcome of a different application, even one seeking a very similar modification on the same estate: Martin v Lipton [2020] UKUT 8 (LC); [2020] PLSCS 7 followed.
(3) The question which the tribunal had to address was whether modifying the restriction to permit the proposed development was likely to open the way to further developments which, taken together, would undermine the efficacy of the protection afforded by the covenants from which the objectors benefit. If there was a significant risk that it might do so, and that the attractions of the estate might thereby be jeopardised, the avoidance of that risk would be a practical benefit capable of being of substantial value or advantage to the objectors.
In the present case, the proposed extension disturbed the original design philosophy of the estate. However, the scope to alter by extension, the street facing elements of any of the other houses was very limited. Greater scope existed to extend into gardens on the estate. Most of the gardens were very constricted and extensions would potentially have an adverse effect on the amenity of neighbours. The removal of permitted development rights offered some protection for owners, but the covenant ensured that the amenity currently enjoyed was protected by an additional layer of security. Extensions into the gardens of other properties would have a deleterious effect on the visual amenity for owners in the wider estate, not to mention the possibility of harm to its character.
(4) Having considered the perceived practical benefits, the tribunal’s conclusion was that modification of the covenant to allow the extension would encourage others to seek to extend their properties and increase the prospects of them being successful. A significant loss of amenity was a likely risk. The covenant in its existing form removed the element of uncertainty about what might be permitted in the future and provided assurance to owners that the form of the estate would not be disturbed. In a densely developed estate where outside space and light were at a premium, it was clear that the covenant protected attributes that were worth preserving. It followed that the practical benefit conferred by the covenant was of substantial advantage and the requirements of section 84(1)(aa) were not satisfied. Therefore, the tribunal had no jurisdiction to grant the modification.
Andrew Skelly (instructed by Osbornes Law) appeared for the applicants; Jonathan McNae (instructed by Direct Access) appeared for the objectors.
Eileen O’Grady, barrister
Click here to read a transcript of Cross and another v Coach House Mews (Highbury) Ltd and others
