Restrictive covenants — Original conveyances envisaged a particular layout — Whether change of layout amounted to derogation of grant causing restrictions on building and use of land for roads to be obsolete
The subject
property was part of an estate sold in plots following its acquisition by the
original vendors (‘the vendors’) in March 1934. Plot F3 is part of the subject
property and was conveyed in June 1934 subject to a number of restrictions,
including that no building should be erected unless the plans thereof had been
previously approved by the vendors and no land should be used as a road without
the vendors’ consent; no building has yet been erected on this plot. The rest
of the subject property, consisting of plots F1 and F2, was conveyed by the vendors
in February 1935 subject to a number of similar and additional restrictions. A
large house has been built on that part of the subject property which
constituted plot F2. Because there was no person answering the description of
the vendors or their surveyor, the dispensing power no longer subsisted and the
restrictions were absolute, the benefit being held by successors to the vendors
of other parts of the original estate capable of being benefited. All the land
behind the subject property was sold in 1938 and developed using a different
layout from that originally envisaged in the 1935 conveyance; that conveyance
indicated that five of the plots would have access to a new road which had
never been built. The appellants therefore contended that there has been
derogation from grant in that by the 1935 conveyance there was purportedly a
grant of rights of way over the intended estate roads, because of the new
layout those roads have not been constructed, the appellants are therefore to
be compensated by being permitted to develop the subject property without
restriction, the restrictive covenants being inapplicable or obsolete under
section 84(1)(a) of the Law of Property Act 1925. The doctrine of derogation of
grant still applies notwithstanding that the purported grant of rights of way
is void for perpetuity. The Lands Tribunal dismissed the appellants’
application for modification.
reserved to the vendors the right to alter or modify the proposed layout of the
estate. The purchasers therefore could not object to the changed layout, which
took place over 40 years ago, without apparent objection that access by the
intended estate road was being permanently removed. Further, it was not possible
to imply extensive grants where it was plain that the intention was that the
vendors of the estate were not to be fettered in their development of it.
The following
cases are referred to in this report.
Birmingham
Dudley & District Bank v Ross (1885) 38
ChD 295
Dunn v Blackdown Properties Ltd [1961] Ch 433; [1961] 2 WLR 618;
[1961] 1 All ER 62
Sharpe v Durrant (1911) 55 SJ 423
This was an
appeal by way of a case stated from a decision of the Lands Tribunal refusing
to modify covenants on the application of the appellants, Beechwood Homes Ltd
and Mr and Mrs Baines, on their application under section 84(1)(a) and (aa)
of the Law of Property Act 1925 to the tribunal.
Martin Mann QC
and Christopher Young (instructed by Pictons, of St Albans) appeared for the
appellants; John Cherryman QC and Robert Bailey-King (instructed by Machins, of
Luton) appeared for the objectors.
Giving
judgment, DILLON LJ said: This is an appeal by the procedure of a case
stated by a company called Beechwood Homes Ltd and a Mr and Mrs Baines against
a decision of the President of the Lands Tribunal (Mr Wellings QC) dated May 18
1992. By his decision the President dismissed an application by the appellants
for the modification under section 84 of the Law of Property Act 1925 (as amended)
of certain restrictive covenants affecting a property known as Wick House, 50
Marshal’s Drive, St Albans (the ‘subject property’).
The relevant
provisions of section 84 are subsections (1) and (1A).
(1) The Lands Tribunal shall (without prejudice
to any concurrent jurisdiction of the court) have power from time to time, on
the application of any person interested in any freehold land affected by any
restriction arising under covenant or otherwise as to the user thereof or the
building thereon, by order wholly or partially to discharge or modify any such
restriction on being satisfied —
(a) that by reason of changes in the character of
the property or the neighbourhood or other circumstances of the case which the
Lands Tribunal may deem material, the restriction ought to be deemed obsolete;
or
(aa)that
(in a case falling within subsection (1A) below) the continued existence
thereof would impede some reasonable user of the land for public or private
purposes or, as the case may be, would unless modified so impede such user; or
(b) that the persons of full age and capacity for
the time being or from time to time entitled to the benefit of the restriction,
whether in respect of estates in fee simple or any lesser estates or interests
in the property to which the benefit of the restriction is annexed, have
agreed, either expressly or by implication, by their acts or omissions, to the
same being discharged or modified; or
(c) that the proposed discharge or modification
will not injure the persons entitled to the benefit of the restriction;
and an order
discharging or modifying a restriction under this subsection may direct the
applicant to pay to any person entitled to the benefit of the restriction such
sum by way of consideration as the Tribunal may think it just to award under
one, but not both, of the following heads, that is to say, either —
(i) a sum to make up for any loss or
disadvantage suffered by that person in consequence of the discharge or
modification; or
(ii) a sum to make up for any effect which the
restriction had, at the time when it was imposed, in reducing the consideration
then received for the land affected by it.
(1A) Subsection (1)(aa) above authorises the
discharge or modification of a restriction by reference to its impeding some
reasonable user of the land in any case in which the Lands Tribunal is
satisfied that the restriction, in impeding that user, either —
(a) does not secure to persons entitled to the
benefit of it any practical benefits of substantial value or advantage to them;
or
(b) is contrary to the public interest;
and that
money will be an adequate compensation for the loss or disadvantage (if any)
which any such person will suffer from the discharge or modification.
In particular
reliance is placed on subheads (a) and (aa) in subsection (1).
So far as (a)
is concerned the objectors to the development deny that the restrictions are
obsolete. So far as (aa) is concerned the appellants put forward three
alternative schemes for development of the subject property.
It is accepted
by the objectors that any of the three would be a reasonable use for private
purposes of the subject property and that such reasonable use would be impeded
by the restrictions unless modified. Consequently the question under (aa)
is that raised by (1A), namely whether the restrictions in impeding that
reasonable use do not secure practical benefits of substantial value or
advantage to persons entitled to the benefit of the restrictions.
The subject
property was, in the 1920s and early 1930s, part of an estate known as the
‘Marshalswick Estate’. This comprised a substantial Georgian house, then
unoccupied and, I apprehend, long since demolished, in fairly extensive grounds.
The relevant
part of the Marshalswick Estate was under a conveyance of March 28 1934,
acquired by three gentlemen, Christopher Harold Miskin, John Charles Herbert
Lewis and George William Newling Ward.
Since the
relevant restrictions were imposed by these gentlemen in their dispositions of
plots, I shall refer to them as ‘the vendors’.
The 1934
conveyance to the vendors shows the land they were acquiring coloured green and
laid out in lots, as on an estate plan, with private roads yet to be
constructed shown laid out, including Woodside Way and, to the south of it,
Faircross Way.
It seems that
the vendors’ predecessors had been endeavouring to sell off the Marshalswick
Estate for development over the previous years without all that much success,
but their activities are not relevant to this appeal. We are concerned only
with the vendors and their successors.
So far as the
subject property is concerned, it was comprised in two conveyances by the
vendors. The earlier is a conveyance of June 8 1934 between the vendors, of the
one part and Stephen Line, as purchaser, of the other part. It comprised one
plot only, plot F3, with a frontage to the north to the road Marshal’s Drive.
It was conveyed with a right of way over Marshal’s Drive, as to which no issue arises.
The conveyance
imposed a number of restrictions on plot F3. No 2 provided for a building line
parallel to, and to the south of, Marshal’s Drive, No 3 limited building to one
detached or semi-detached private dwelling-house with garage or outbuildings.
More importantly, restriction 4 provided, so far as for present purposes is
material:
No building
or erection of any kind shall at any time be erected upon any of the said land
unless and until plans and elevations thereof including a block plan showing the
proposed position of the house and of every out building, boundary wall and
fence if any shall have been previously submitted to and approved of in writing
by the vendors or the surveyor for the time being of the vendors which approval
shall not be unreasonably withheld.
Restriction 9
provided:
No part of
any of the said land shall be used as a road or way without the consent in
writing of the vendors first being obtained.
Para 12 in the
restrictions provided:
The vendors
reserve the right at any time before or after any sale or disposition of any
part of the estate to alter or modify the proposed plan of development and
layout of the said estate and to alter modify or waive any of the stipulations
as to any plot or plots for the time being remaining unsold or in which the
vendors have for the time being any interest or as to which they may be
requested by the owner thereof for the time being to alter, modify or waive any
of such stipulations.
At some date
unknown, but prior to 1946, the property comprised in that conveyance was
conveyed to Phyllis Miskin, the wife of Christopher Harold Miskin, who was one
of the vendors.
No
dwelling-house or other building has as yet been built on that land, that is to
say plot F3. The rest of the subject property was conveyed by the vendors to
Phyllis Miskin by a conveyance of February 7 1935.
The property
conveyed is shown as consisting of plots F1 and F2 abutting on Marshal’s Drive
— F2 being alongside and immediately to the west of plot F3 and plots G1, G2 G3
and 143 and 144 at the rear, which are shown abutting on the proposed estate
road to be called Woodside Way.
The plan on
this conveyance shows Woodside Way leading into a road called Homewood Road,
which now exists and may have existed in 1935, but the root of all the
difficulties is that Woodside Way was never constructed because the vendors
long ago changed their development layout.
The conveyance
of February 7 1935 purports to convey the lots I have mentioned, together with:
. . . full
right and liberty for the purchaser and her successors in title in common with
all other persons who have or may hereafter have the like right, at all times
hereafter by day or by night and for all purposes to go pass and re-pass along
over and upon all roads now or hereafter to be made upon the Marshalswick
Estate.
It is, however,
common ground that in so far as that purported to grant rights of way over
estate roads such as Woodside Way, which had not been constructed, it was under
the then law void for perpetuity: see Dunn v Blackdown Properties Ltd
[1961] Ch 433.
The conveyance
of February 7 1935 also contained restrictions similar to those in the
conveyance of plot F3. There were two building lines, one to Marshal’s Drive
and the other to Woodside Way. Restriction 3 allowed one private house, with
garage and outbuildings per lot. Restriction 4 applied to plans and elevations
for building on any of the lots. These had to be submitted to, and approved by,
the vendors or their surveyor for the time being, whose approval was not to be
unreasonably withheld.
Restriction 9
reads:
No part of
any of the said lots shall be used as a road or way without the consent in
writing of the vendors first being obtained.
Para 12,
reserving the vendors’ rights to change the plan of development and layout of
the estate, and so forth, was in the same terms as in the conveyance of June 8
1934 of plot F3.
In fact, on
the totality of the subject property, only one single dwelling-house, no doubt
with garage and appropriate outbuildings, has ever been built. That is a
substantial neo-Georgian house, called ‘Wick House’, which has been built on
plot F2, with access down that plot from Marshal’s Drive. This was, I
apprehend, built at sometime before war broke out in 1939.
Before I come
to the subsequent history and devolution of title, I will deal with the
position as to consents under the restrictions and as to the interplay of
restrictions 4 and 9. As to the latter, I accept Mr Cherryman’s submission that
restriction 9 is not concerned with the laying out of a drive wholly within a
plot to the dwelling-house to be built on that plot as envisaged by restriction
3. I do not think Mr Martin Mann QC seriously dissents from that and therefore
I do not take up time to give reasons.
Restriction 9
is concerned, however, to prevent any drive being laid across the boundaries
from one plot to another so as, for instance, to allow access from a plot at
the back of the original layout across a plot in front, or to the side to one
of the public highways.
As to the
consents, I accept Mr John Cherryman QC’s submission that the case proceeded in
the Lands Tribunal and must therefore proceed in this court on the common basis
that the power to consent
restriction 9, is a dispensing power attached to an otherwise absolute
prohibition.
Thus when, as
has happened, the estate, as acquired by the vendors, has been fully developed
and the original vendors are no longer on the scene and have no retained land,
and there is no one to answer the description of the vendors or their successor
or their surveyor, and so no one to give the consent, the position is that the
dispensing power has gone. But the restrictions remain unmitigated by any
dispensing power. It is not the position that the restrictions vanish with the
dispensing power.
It follows, if
no dispensing power on the part of the vendors or their surveyor subsists, that
to do anything in breach of restriction 4 or restriction 9, that is to say to
erect a dwelling-house on a plot which as yet has never had a house on it or to
lay out a road or way in the sense in which those terms are used in restriction
9, would require either the consents of everyone who has the benefit of the
covenants, or relaxation of the covenants by the Lands Tribunal under section
84.
It is accepted
that, now that the vendors no longer retain any land capable of being benefited
by the restrictions, the persons who are entitled to the benefit of the
restrictions are anyone who, under conveyances from the vendors or their
successors whether prior to or subsequent to the conveyances by the vendors of
the subject property in 1934 and 1935, has acquired any part of the land
capable of being benefited by the subsistence of the covenants.
Two further
points follow in relation to section 84. The first is, so far as section 84(1A)
is concerned, that restrictions 4 and 9 do not become obsolete because the
dispensing power is obsolete and no longer subsists and not exercisable. The
restrictions merely become absolute and thus more onerous.
The next, in
relation to section 84(1)(aa) and (1A)(a), is that, where there
is reference to the restrictions securing to persons entitled to the benefit
any practical benefits of substantial value or advantage, one has to look at
the benefits which they enjoy from the subsistence of the restrictions with no
dispensing power. One does not weigh whether there is now substantial value or
advantage by considering whether there would have been any substantial value or
advantage as things were at the time when the vendors were still on the scene
and had their dispensing powers.
I come next to
the devolution of the titles.
So far as the
subject property is concerned, it appears that, by a conveyance of January 27
1944, Mrs Miskin, for whatever reason, conveyed it back to her husband,
Christopher Harold Miskin. Subsequently, on September 17 1946, it was conveyed
by him to a company called The Cedars (Highgate) Ltd. That company conveyed it
to another company, J M Vernon & Co Ltd, by a conveyance of February 13
1947. J M Vernon & Co Ltd in turn conveyed it to a Mrs Andrews, apparently
on November 14 1956. It appears that she made an application to the Lands
Tribunal for relaxation of the restrictions, but that failed under the law then
in force. It is immaterial to the matters in issue on this appeal.
Thereafter, by
a conveyance of October 17 1966, Mrs Andrews, who is described as ‘ . . . of
Wick House, 50 Marshal’s Drive, St Albans’, conveyed the subject property to a
Mr and Mrs Tughan. They, in turn, conveyed Wick House to Mr and Mrs Baines on
September 11 1989, and the rest of the subject property to a company called
Beechwood Homes Ltd, (the other appellant) on June 13 1988.
As to the rest
of the estate acquired by the vendors, there is a contract for sale dated April
12 1938, whereby the vendors contracted to sell all the land behind the subject
property, including the site of the proposed Woodside Way, to a company called
Marshalswick Estates Ltd. For that purpose an entirely new layout plan was used.
Instead of Woodside Way and the houses to the south of it down to Faircross
Way, there is a new layout called ‘The Park’ abutting on a road in the shape of
a horseshoe, with both ends leading out of Faircross Way. Consequently, at the
back of the subject property where Woodside Way would have been if the then
layout plan had been followed fronting plots G1, G2, G3, 143 and 144, there are
the back gardens of the houses which front on to the top curve of the
horseshoe. It seems that some plots thus agreed to be sold to Marshalswick
Estates Ltd were, for convenience, sold by conveyances by the vendors with the
concurrence of Marshalswick Estates Ltd to individual purchasers. The balance
of what had been agreed to be sold to Marshalswick Estates Ltd was apparently
conveyed to that company by the vendors by a conveyance of October 9 1947, of
which no copy is available.
It seems that
the development of The Park, in accordance with the new layout, was completed
by 1955.
Christopher
Harold Miskin was a local builder. It is not known whether Marshalswick Estates
Ltd had any connection with him, or with either of the other vendors. It is
known that Marshalswick Estates Ltd went into liquidation well over 35 years
ago.
In addition,
we know that an area of the land, to the western side of the land included in
the original conveyance to the vendors of March 28 1934, was developed in 1960
or so by the building, not by the vendors, of a range of maisonettes called
Charmouth Court in a cul-de-sac development off another road to the west of
Charmouth Road. Charmouth Court seems to have been developed under a separate
scheme of restrictions with which the subject property is not directly
concerned.
The
development of Charmouth Court in this way was, of course, a change in the layout
plan from the original plan which pertained in 1934 and 1935.
It was
submitted to the Lands Tribunal that this ‘broke the pattern of the scheme’,
and so rendered all restrictions on the subject property obsolete, but the
President rejected the submission and was right to do so.
I come to Mr
Mann’s main submission on this appeal. This was founded on the doctrine of
derogation from grant. It was said that, as the layout in the plan on the
conveyance to Mrs Miskin of February 7 1935 envisaged the building of a house
each on the five plots 143, 144, G1, G2 and G3 with access by Woodside Way, and
in the conveyance itself there was purportedly a grant of rights of way over
the intended estate roads, it was a derogation from grant for the vendors or
their successors, Marshalswick Estates Ltd, or whoever it was to abandon the
construction of Woodside Way to lead to Homewood Road and to construct instead
The Park and its houses. Therefore it is said that by way of compensation for
the derogation from grant the owners of the subject property, that is to say
the appellants and their predecessors, are entitled to build houses on their
plots within the limits of restriction 3 and lay out a drive or drives from
those houses anywhere within the area of the subject property up to Marshal’s
Drive without regard to restrictions 4 and 9 which, by virtue of the doctrine
of derogation from grant, are to be regarded as inapplicable or obsolete, and
so to be overridden by the Lands Tribunal under section 84(1A). It is said that
the vendors, or their successors at the time, would have been bound to have
granted consents to roads or ways leading from those back plots up to Marshal’s
Drive, and so there is no question of any injunction being granted to restrain
development by the building of houses, with such access to Marshal’s Drive.
Therefore, there is no basis on which the covenant should not be overridden.
It is further
said that, even if the purported grant of rights of way over the estate roads
such as Woodside Way which had not yet been constructed is void for perpetuity,
none the less the doctrine of derogation from grant still applies and the
invalidity of the purported grant does not prevent the purchasers, or
successors to the purchasers, of the plots fronting Woodside Way from passing
over where Woodside Way would have been as if they had had a valid grant of a
right of way.
Reference is
made to Sharpe v Durrant (1911) briefly reported in 55 SJ 423,
where Warrington J is recorded as saying:
The legal
objection on which the plaintiff relies is this — The deed of conveyance
contains two provisions — the reservation, and the covenant relating to things
to be done pursuant to the reservation . . . until the selection is made there
is no easement; the reservation is of an easement in futuro, which may
come into force at a time beyond the period allowed by the rule
conclusion I agree; but that does not determine the case.
He then passes
on to say that the obligation not to obstruct the defendants crossing along the
line of the reservation took effect and bound the owner not to interfere. That
subsisted, notwithstanding that the grant of a right to pass by way of easement
was void. Accordingly, a declaration was made to that effect.
As I see it,
the situation is not like that, because we have several factors here. The first
is that the conveyances by the vendors of the subject property in 1934 and in
1935 expressly, by para 12, reserved to the vendors the right at any time to
alter or modify the proposed plan of development and layout of the estate.
Therefore, as it seems to me, the purchasers from the vendors could not object
to a modification. Beyond that the alteration when The Park was laid out must
have been plain and obvious. That was at latest nearly 40 years ago, but
nothing whatever was done to raise any protest or to suggest that some
alternative provision required to be made by the vendors, because the access by
the intended Woodside Way was being permanently removed.
Plainly there
could be no question now of the occupiers of houses built at the back of the
subject property claiming access across the gardens of the houses in The Park,
where Woodside Way would have been, to get to Homewood Road, but as I see it
there are further difficulties. It is not possible, as is shown by the case of Birmingham
Dudley & District Bank v Ross (1885) 38 ChD 295, to imply
extensive grants where it is plain that the intention was that the vendor who
was owner of the property in question was not to be fettered in his
redevelopment of it, and also the suggested compensation now thought of at a
time when the vendors are no longer on the scene and the power to consent has
lapsed would be at the expense of the purchasers from the vendors and, in
particular, those who purchased plots fronting on Marshal’s Drive who have the
benefit of the covenants. I cannot see why the rights of these adjoining owners
with the benefit of the covenants should be retrospectively overridden because
Mrs Miskin or Mr Miskin or The Cedars (Highgate) Ltd or J M Vernon & Co Ltd
chose not to seek any variation of the restrictions at the time when the
vendors were around. They seem all to have been content to regard the subject
property as a single property on its own, a substantial house with substantial,
by modern standards, garden and grounds.
I regard it as
far too late, therefore, to seek to change the scheme by applying for the
relaxation of the restrictions. The failure of those concerned, which may well
have been deliberate, to take action to negotiate some alternative way out from
the back, when the estate layout was changed and was to be developed, does not
to my mind add anything to the weakness of the application under section 84,
which the president refused.
The president
was right to consider the benefits which those who have the benefit of the
covenants now enjoy, and have enjoyed for many years, in the situation where
the power of relaxation under the original conveyances entered into by the
vendors when the restrictions were imposed no longer subsists.
It follows
that I see no fault in the conclusions of the president in this case.
A suggestion
is made that he has not correctly appreciated some of the evidence given by
surveyors for the objectors and that that is an error of law which this court
should take account of with the consequence, perhaps, that the case should be
remitted to the Lands Tribunal for a new trial.
I am not
persuaded that there has been any error of law of that nature on the part of
the president. He has made a careful analysis of the effect of the proposed
building schemes of the appellants on the various parts of the properties of
the objectors who have the benefit of the covenants. He had the benefit himself
of a view of the site which we have not had.
Accordingly, I
would reject the various grounds of appeal which have been put forward, and I
would dismiss this appeal.
LEGGATT and HENRY LJJ agreed and did not add anything.
Appeal
dismissed with costs.
