Planning agreement — Restrictive covenant — Restriction to private open space — Planning permission granted on appeal for dwelling-house — Application under section 84 of the Law of Property Act 1925 to modify or discharge restriction — Lands Tribunal dismissed application — Appeal against decision of tribunal
The applicants
are the owners of a house and garden affected by a planning agreement.
Following an appeal to the Secretary of State for the Environment, against a
decision of the local planning authority to refuse permission, they were
granted outline planning permission to build a house on part of their garden.
This part of the garden was made the subject of a restriction imposed by a
planning agreement made in 1967 between a predecessor in title to the land and
the local planning authority. The planning agreement was made under section 37
of the Town and Country Planning Act 1962 (see now section 52 of the Town and
Country Planning Act 1971) in connection with a substituted planning permission
for residential development. The agreement provided that the land in question
‘shall not be used for any purpose other than as a private open space and that
accordingly no building, structure or erection (other than fencing, a summer
house or garden if the owner shall so require) shall be placed thereon’.
The applicants
applied to the Lands Tribunal under section 84(1) of the Law of Property Act
1925, as amended by section 28 of the Law of Property Act 1969, for the
modification or discharge of the restriction on grounds (a) (aa)
and (c). Their application was dismissed ((1986) 53 P&CR 146) and
they appealed from that decision. In support of their appeal it was contended
that where restrictions are imposed under a planning agreement, the
restrictions are imposed for planning purposes and where, as in this case, the
Secretary of State for the Environment, by his inspector, determines that
development should be permitted, the purpose of the planning agreement has gone
and the restriction should be modified or discharged on the grounds set out in
their application.
respect of each ground contended for.
1. The
restriction was not obsolete under ground (a) of section 84(1) of the
Law of Property Act 1925. There are two different statutory regimes: planning
applications for which there is an appeal to the Secretary of State for the
Environment under the Town and Country Planning Act 1971; and planning
agreements for which there is a right to apply to the Lands Tribunal under
section 84 of the Law of Property Act 1925. A planning agreement creates a
fully effective restrictive covenant which operates in just the same way as if
the local planning authority concerned was the owner of adjoining land for the
benefit of which the covenant was taken: see p 49E. The benefit of the covenant
is an interest in land and it is not extinguished by the acts of a planning
authority. It is wrong to assume that because planning permission is given on
appeal, the tribunal is bound to discharge or modify any restrictions in a
planning agreement: the fact that permission has been granted is merely a
circumstance to be taken into account by the tribunal: see p 50C. The purpose
of the restriction in the present case was to prevent excessive density of
development and, on the evidence before the tribunal, that purpose remained and
the restriction was not therefore obsolete: see p 51A.
2. The
tribunal was also entitled to conclude that ground (aa) was not made out
in that it decided that the restriction was of substantial advantage to the
local planning authority to protect the visual amenity of the area and to
prevent cramped development: see p 51B-E.
3. Ground (c)
was not made out in that any discharge or modification of the restriction would
injure the local planning authority, as the custodian of the public interest in
the preservation of the amenities, and monetary compensation was wholly
inappropriate: see p 51E-F.
to in the judgments
Driscoll v Church Commissioners for England [1957] 1 QB 330; [1956] 3
WLR 996; [1956] 3 All ER 802; (1956) 7 P&CR 371; [1956] EGD 259; 168 EG
521, CA
Truman,
Hanbury, Buxton & Co Ltd’s application, Re
[1956] 1 QB 261; [1955] 3 WLR 704; [1955] 3 All ER 559; (1955) 7 P&CR 348;
[1955] EGD 169; 166 EG 564, CA
Appeal against
a decision of the Lands Tribunal
This was an
appeal by way of a case stated from a decision of the Lands Tribunal to dismiss
an application to modify or discharge a restrictive covenant contained in a
planning agreement made under section 37 of the Town and Country Planning Act
1962 on grounds (a), (aa) and (c) of section 84(1) of the
Law of Property Act 1925.
(instructed by Menneer Idle & Brackett, of Bexhill on Sea) appeared for the
applicant.
Humphrey (instructed by the solicitor to Hastings Borough Council) appeared for
the respondent local planning authority.
following judgments of the court were delivered.
FOX LJ: This is an appeal by Mr and Mrs Martin (‘the applicants’) from a
decision of the Lands Tribunal (Mr V G Wellings QC) refusing their application
for the discharge or modification of a restrictive covenant. The case is
concerned with the ambit of the tribunal’s powers under section 84 of the Law
of Property Act 1925 to modify or discharge restrictive covenants where the
covenant is created by what is generally called a section 52 agreement, ie an
agreement entered into under section 52 of the Town and Country Planning Act
1971.
The applicants
own 228 Harley Shute Road, St Leonards, East Sussex, which is a house and
garden. The land which is subject to the covenant is part of the garden. It is
L-shaped, the foot of the ‘L’ being at the south-eastern end of the garden of
no 228. The remainder of the ‘L’ (ie the perpendicular arm) adjoins the western
boundary of the garden; it is about 170 ft long, has a frontage of about 60 ft
to Harley Shute Road and an area of about 0.2 of an acre. I refer to it as plot
3. The applicants wish to develop that plot.
The houses in
Harley Shute Road in the vicinity of plot 3 are all detached houses with
substantial gardens. No 228 was built in about 1928; the other houses on the
same side of the road (with the exception of no 218, which was built in the
1960s) were built in the 1930s. The houses on the other (ie north-west) side of
the road were built in the 1960s.
I should
mention that the next house to no 228 is no 224; there is no no 226. Provision
was, it seems, made for a water supply branch to plot 3. The applicants
accordingly believe that the original developer contemplated that a house
should be built on plot 3.
In October
1965 Hastings Borough Council granted to the predecessor in title of the
applicants outline planning permission for the erection of two houses in the
garden of no 228. One of these would be on plot 3 (though with a somewhat
narrower frontage to the road than the frontage of plot 3) and the other in a
position with access to Gillsman’s Hill (a road which runs into Harley Shute
Road from the east).
In 1960 the
then owner of no 228 wished to change the position of the permitted houses and
applied for planning permission for two detached houses with access to
Gillsman’s Hill. There then followed discussions with the planning authority
regarding the existing planning permission on the land fronting Harley Shute
Road. The authority was concerned lest it should have to pay compensation if
that permission were revoked.
In the autumn
of 1966 it was agreed that the existing permission should be revoked without
compensation. In fact, however, that agreement was not given effect to.
Instead, the parties entered into an agreement (‘the agreement’) under section
37(2) of the Town and Country Planning Act 1962. Section 37 was in the
following terms:
37–. (1) A local planning
authority may, with the approval of the Minister, enter into an agreement with
any person interested in land in their area for the purpose of restricting or
regulating the development or use of the land, either permanently or during
such period as may be prescribed by the agreement; and any such agreement may
contain such incidental and consequential provisions (including provisions of a
financial character) as appear to the local planning authority to be necessary
or expedient for the purposes of the agreement.
(2) An agreement made under this section with any
person interested in land may be enforced by the local planning authority
against persons deriving title under that person in respect of that land, as if
the local planning authority were possessed of adjacent land and as if the
agreement had been expressed to be made for the benefit of such land.
(3) Nothing in this section or in any agreement
made thereunder shall be construed —
(a) as restricting the exercise, in relation to
land which is the subject of any such agreement, of any powers exercisable by
any Minister or authority under this Act so long as those powers are exercised
in accordance with the provisions of the development plan, or in accordance
with any directions which may have been given by the Minister as to the
provisions to be included in such a plan, or
(b) as requiring the exercise of any such
powers otherwise than as mentioned in the preceding paragraph.
(4) The power of a local planning authority to
make agreements under this section may be exercised also —
(a) in relation to land in a county district,
by the council of that district;
(b) in relation to land in the area of a joint
planning board, by the council of the county or county borough in which the
land is situated,
and
references in this section to a local planning authority shall be construed
accordingly.
The section has
now been replaced by section 52 of the Town and Country Planning Act 1971 with
modifications which are not material.
The agreement
was entered into on February 27 1967 and was made between the Mayor, Aldermen
and Burgesses of the Borough of Hastings (which and its successors I will call
‘the corporation’) of the one part and William Fletcher of the other part. Mr
Fletcher was then the owner of the freehold of no 228. The agreement recited, inter
alia, as follows:
The Owner has
made application for Planning Permission . . . for the erection of two
dwellings on the said land hatched pink and hatched pink and blue and
concurring with the opinion of the Corporation that it would be inappropriate
by reason of the excessive density of buildings which might thereby ensue for
the Corporation to grant such Planning Permission whilst the Planning
Permission . . . granted by the Corporation on the fourteenth day of October
one thousand nine hundred and sixty five for the erection of
requested the Corporation to enter into this Agreement.
The operative
part of the agreement provided as follows:
NOW THEREFORE
it is hereby agreed by and between the parties hereto in pursuance of Section
37 of the Town and Country Planning Act 1962 that the said land hatched blue
shall not be used for any purpose other than as a private open space and that
accordingly no building, structure or erection (other than fencing a summer
house or garden shed if the owner shall so require) shall be placed thereon.
The land
hatched blue is the L-shaped land and accordingly includes plot 3.
On March 7
1967 the corporation granted planning permission to the former owner for the
erection of two dwellings each with access to Gillsman’s Hill. On May 12 1967
the minister approved the agreement. Subsequently the two houses permitted by
the planning permission of March 7 1967 were erected on two plots forming part
of the garden of no 228 Harley Shute Road (but excluding plot 3). The two plots
were then sold off.
No 228 and the
residue of its land (including plot 3) were bought by the applicants in 1978.
In May 1983 the applicants applied for planning permission for the erection of
a two-storey detached house with garage on plot 3. The application was refused
on the grounds that plot 3 had inadequate width to accommodate a two-storey
dwelling and would constitute a cramped form of infilling development which,
together with the loss of mature trees, would result in an unacceptable loss of
visual amenity.
The applicants
appealed to the Secretary of State for the Environment, whose inspector in
August 1984 granted outline planning permission for the proposed development.
The decision letter contained, inter alia, the following observations:
12. It is my
view that, while this development has aroused concern, to allow it to proceed
would not put in jeopardy the visual environment of the area. Even though the
proposed dwelling and its site will be smaller than its neighbours I am
satisfied that careful and sensitive handling of its appearance and siting at
detailed stage should ensure a satisfactory and compatible design. This I
consider to be of importance because there is no doubt that the area has
distinctive qualities that arise from the siting, scale and well-considered
details of these houses and their gardens. The question of the possibly cramped
appearance of the site and the effect of the development on its neighbours I
consider is of equal importance.
13. The
houses opposite the site are smaller, narrower and are sited above the road
with open-front gardens so that they are more open to view. Whereas the houses
on the appeal-site side of the road are set below road level with shallow but
mature gardens enclosed by dense hedges to their front. They are less open to
view and are almost without exception broad-fronted houses that nearly fill the
widths of their sites and they present an almost continuous but varied facade
that follows the sweep of the road. To fill a gap in this development with a
house that follows a similar pattern of height and building-line is, in my
view, acceptable even though it may be marginally smaller. The retention and
protection of the trees that front the site play an important part in this
consideration and I am imposing a condition to that effect. If care is taken I
see no reason why they should be harmed so that they can continue to provide
privacy to the site and at the same time enhance the environment of the street
. . .
It is common
ground that as a matter of the law of restrictive covenants and having regard
to the provisions of section 37 of the 1962 Act, the covenant contained in the
agreement is enforceable by the corporation against the applicants.
Notwithstanding
the grant of planning permission upon the appeal, the corporation is not
prepared to release the applicants from the provisions of the agreement. The
applicants then applied to the Lands Tribunal to discharge or modify the
provisions of the agreement. The grounds relied upon by the applicants are
those in (a), (aa) and (c) of section 84(1) of the Law of
Property Act 1925, that is to say:
(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 . . .
(c) that the proposed discharge or modification
will not injure the persons entitled to the benefit of the restriction: . . .
The
corporation in its notice of objection to the application stated:
The section
37 Agreement was freely entered into by the owners of the land in 1967 and in
the intervening years there has been no change in circumstances which would
cause the local planning authority to change its view that it is in the
interests of the amenities and the environment of the area that this piece of
land remains undeveloped.
The Lands
Tribunal dismissed the application under all the heads relied upon. The
applicants now appeal.
When a
restrictive covenant is entered into between owners of adjoining, or otherwise
affected, lands the fact that the owner for the time being of the burdened land
subsequently obtains planning permission to develop that land in a manner which
is prohibited by the covenant does not entitle him to ignore the covenant. The
benefit of the covenant is an interest in land and it is not extinguished by
the acts of a planning authority. The position under a section 37 (or section
52) agreement is no different. Such an agreement creates a fully effective
restrictive covenant which operates in just the same way as if the local
authorities concerned were the owners of adjoining land for the benefit of
which the covenant was taken. In either case if the owner of the burdened land
wishes to be rid of the covenant he must, in the absence of agreement with the
dominant owner, obtain a discharge or appropriate modification of the covenant
under section 84 of the Law of Property Act 1925.
Basically, the
submission on behalf of the applicants is that, upon an application to the
Lands Tribunal under section 84, while the grant of planning permission does
not determine how the tribunal should deal with a case where the covenant was
entered into between adjoining landowners, quite different considerations apply
when the covenant derives its validity from section 37 (or section 52). The
argument, in substance, is this. It is said that a section 37 agreement is
entered into by a planning authority under statutory powers in the town and
country planning legislation and for a planning purpose (ie to restrict or
regulate the development or use of land). In these circumstances, it is
contended that where the minister, by his inspector, has finally determined
from a planning point of view that the erection of a house on the site was
acceptable, then the purpose of the section 37 agreement has gone and the
covenant should be discharged.
This
construction is, in my opinion, based upon a misapprehension. There are, it
seems to me, two statutory regimes. One is the power of the planning authority
under section 37 (and now under section 52) to enter into an agreement
regulating the development and use of land by way of restrictive covenant in
circumstances where, under the general law, it would not be
burden and benefit of covenants. The other is the power of the planning
authority under section 29 of the 1971 Act (and section 16 of the 1962 Act) to
grant planning permission. These regimes are subject to different procedures.
If a person is dissatisfied with the planning authority’s refusal of planning
permission, his remedy is to appeal to the Secretary of State under section 36
of the 1971 Act (section 23 of the 1962 Act). If a person who is bound by the
provisions of a section 37 agreement wishes to escape from them he must go to
the Lands Tribunal and persuade the tribunal that it is a proper case to
exercise its jurisdiction to discharge or modify the covenant under section 84.
Nobody was
obliged to enter into a section 37 agreement. If an applicant for planning
permission was offered permission upon terms that he entered into a section 37
agreement he could appeal to the Secretary of State. But if he chose to enter
into the agreement he (and his successors in title) must accept that he can
avoid its effect only through the statutory procedure under section 84. Thus,
it seems to me that, while the two regimes impinge upon each other to some
extent, they constitute different systems of control and each has, and retains,
an independent existence. In my view, the applicants’ contention is wrong in so
far as it suggests that the granting of planning permission by the Secretary of
State necessarily involves the result that the Lands Tribunal must discharge
the covenant. The grant of planning permission is, it seems to me, merely a
circumstance which the Lands Tribunal can and should take into account when
exercising its jurisdiction under section 84. To give the grant of planning
permission a wider effect is, I think, destructive of the express statutory
jurisdiction conferred by section 84. It is for the tribunal to make up its own
mind whether the requirements of section 84 are satisfied. The grant of
permission by the Secretary of State is no more conclusive of that than is, for
example, the deemed grant of planning permission under the provisions of the
General Development Order.
All the facts
of the case have to be examined by the Lands Tribunal. There is nothing in the
Town and Country Planning Acts 1962 or 1971 which suggests that these are
intended to interfere in any way with the jurisdiction of the Lands Tribunal
under section 84.
I come then to
the question of what the Lands Tribunal actually decided.
So far as para
(a) of section 84(1) is concerned, the learned member, Mr Wellings,
observed that the purpose of the restriction, as appears from the recitals to
the agreement, was to prevent excessive density of building on the original
curtilage of no 228. Mr Wellings, who himself had inspected the site, accepted
the evidence of Mr A W Constantine, MRPTI ARICS, the deputy borough planning
officer of the corporation, that the new house, if built, would have a cramped
appearance to the detriment of the visual amenity of the area and that a
cramped appearance is a manifestation of excessive density. Mr Wellings also
observed that the inspector, who merely granted outline planning permission,
did not explain how the cramped appearance of the house might be overcome; and
there was no material before the Lands Tribunal to determine that question. It
followed that the purpose of the covenant could still be achieved. Accordingly,
the member took the view that the purpose of the restriction could still be
achieved and it should not be deemed obsolete. He so held.
I see no
ground for interfering with that conclusion. The test for obsoleteness is
whether the original object of the restriction can still be achieved (Re
Truman, Hanbury, Buxton & Co Ltd’s application [1956] 1 QB 261; Driscoll
v Church Commissioners for England [1957] 1 QB 330).
Prima facie the original object could be achieved and there was no adequate
evidence displacing that. The mere fact of the inspector’s conclusion does not
displace it. It is, in my view, no answer to say that the inspector thought the
development was unacceptable. The question whether a restriction is obsolete
has to be determined by the Lands Tribunal on the evidence before it.
As regards
para (aa), this applies only in a case within subsection (1A) of section
84, that is to say when the restriction either confers no practical
benefit of substantial value upon the person entitled to the benefit of it or
is contrary to the public interest and, in either case, that money will be
adequate compensation for the discharge of the covenant. The member took into
account the decision of the inspector but did not think that the restriction
was contrary to the public interest having regard to the cramped appearance
which the new house would give.
As to benefit,
the member was of the opinion that it is a practical benefit to the corporation
to prevent detriment to the visual amenity of this part of its area and that
this was of substantial advantage to the corporation for which money would not
be an adequate compensation.
I should
observe that Mr Constantine had given evidence that, while the proposed house
would cause no problem of overlooking, it would be visually unacceptable
because the width of the plot is inadequate and, in the context of the existing
properties in the area (which have a distinctiveness because they have a more
relaxed density than houses built at a later date), it would constitute a
cramped form of development. The insertion of another house in the group at the
north-eastern end of Harley Shute Road would be detrimental to the amenities of
that group. The amenities of the neighbourhood, which the corporation had a
duty to protect, would be prejudiced thereby. He knew of no means by which the
cramped appearance could be overcome. Mr Constantine was also of the opinion
that one or two mature trees would go in the course of the development.
In my opinion,
the member was entitled to reach the conclusions which he did and I see no
basis for disturbing those conclusions.
Finally, there
is para (c), namely that the proposed discharge or modification would
not injure the corporation. The member rejected that, since he was of the
opinion that the interference with visual amenity would be an injury to the
corporation in its capacity as custodian of the public interest. In my opinion,
that was a conclusion which the member was entitled to reach.
The member
said that money would not be an adequate compensation to the corporation for
the discharge of the covenant. I think that must be right. If the covenant is
of value to the corporation for the protection of the public interest in the
preservation of the amenities, it is difficult to see how a money payment could
be adequate compensation. Money compensation seems wholly inappropriate.
In the
circumstances, in my judgment the appeal fails and should be dismissed.
BALCOMBE LJ:
I agree.
SIR
FREDERICK LAWTON: I also agree.
Appeal was
dismissed with costs. Leave to appeal to the House of Lords was refused.
