Any party interested in land benefited or burdened by a restrictive covenant can apply for a covenant to be modified or discharged: section 84(1) Law of Property Act 1925. The tribunal may exercise this power if it is satisfied that the restriction has become obsolete following changes in the character of the property or the neighbourhood or as a result of any other relevant circumstances: paragraph (a).
A restriction can also be modified or discharged if the tribunal is satisfied that the continued existence of the restriction would impede some reasonable use of the land for public or private purposes: paragraph (aa). In such cases, the tribunal must also be satisfied that the restriction does not secure to the persons entitled to its benefit any practical benefits of substantial value or advantage, or that it is contrary to the public interest, and that a monetary payment will provide adequate compensation for its modification or discharge.
In addition, the tribunal can modify or discharge a restriction if it is satisfied that the parties entitled to the benefit of the restriction (who must be of full age and capacity) have agreed, either expressly or by implication, to its modification or discharge (paragraph (b)), or that the parties entitled to the benefit of the restriction will not be injured as a result (paragraph (c)).
Re Stafford-Flowers’ application [2015] UKUT 82 (LC); [2015] PLSCS 80 concerned an application to discharge a restrictive covenant that prohibited the owner of a holiday home in a holiday park from occupying his property during restricted winter periods. The home owner tried to persuade the tribunal that the covenant was obsolete: paragraph (a). He pointed to the fact that he had used the property all year round for so many years that he had obtained a certificate of lawful use from the planning authority. Alternatively, he claimed that the property had been designed and built for residential occupation and that the covenant was impeding such use (paragraph (aa)), or that no injury would be caused if the covenant were to be discharged (ground (c)).
The tribunal rejected the application. The character of the holiday park had not changed to such an extent that the restriction should be deemed obsolete. The covenant was key to ensuring that the site did not turn into a housing estate in full-time occupation – for which it was unsuited.
The judge accepted that the covenant stood in the way of a reasonable use of the property, but decided that the discharge of the covenant might make it easier for similar applications in relation to other properties to succeed. Even though it was unlikely to have an instant effect on the character of the site, many more might want to follow the applicant’s lead. The nature of the site would change as a result and the cumulative effect would be disadvantageous. Therefore, the discharge of the covenant would deprive the beneficiaries of it of a practical benefit of substantial value and they would be adversely affected as a result.
The judge did agree to modify the covenant to allow daytime use in restricted winter periods – to reflect a concession by the site manager – but the modification will be cold comfort to the applicant.
Allyson Colby Property Law Consultant
