Restrictive covenants are widely used to impose private restrictions on the use and development of land – and they bind the land affected by them in perpetuity. When land is burdened by covenants that are valid and enforceable, one option for landowners who wish to develop or use land in breach of the restrictions is to seek a release from the landowners who are entitled to enforce them.
It is essential to ensure that all the landowners with the benefit of such covenants participate in any such release to ensure that it is effective. This is not always practicable in cases where the area of land that benefits from the covenants has been sub-divided into smaller plots and sold – unless the landowner who effected the subdivision has reserved to himself the right to vary, or to consent to breaches of, the restrictions. It seems that such a provision is valid, because the purchasers have bought on this footing: Whitehouse v Hugh [1906] 1 Ch D 253.
In Derreb Ltd v White [2015] UKUT 667 (LC); [2016] PLSCS 17, the owner of land burdened by covenants tried to take advantage of a provision in the conveyance that imposed the restrictions, made in 1956, reserving to the seller the exclusive right to release property from them or to convey other parts of the estate subject to different restrictions. The provision defined the seller as “the vendor (which expression shall be taken to include the estate owner or owners for the time being of property for the time being remaining subject to the trusts of the present settlement or any future re-settlement of the Cator Estate at Blackheath)”. Were the “vendor’s” personal representatives entitled to release the covenants in his stead? The case turned on the interpretation of the provision in question.
The Upper Tribunal ruled that the term “vendor” did not include the seller’s personal representatives because the draftsman of the conveyance had defined the persons entitled to release the covenants in strict terms. If the parties had intended the term to include the seller’s personal representatives, this could and should have been specifically and clearly stated. In addition, the trust referred to in the conveyance had now terminated. Consequently, the restrictions remained in place and were enforceable by the objectors, who owned land benefitting from the covenants, even though the seller’s personal representatives had executed a deed releasing them.
Documents are rarely identical in their language and in the circumstances of their creation. However, the decision reminds us of the importance of checking that those purporting to release the benefit of restrictive covenants actually have the power to do so. Practitioners dealing with such provisions would also be well-advised to check whether the seller has reserved a general power to release covenants or whether the power is confined in some way – for example, because it relates only to land that has already been sold, or to land that remains unsold.
Allyson Colby is a property law consultant
