One property owner has the benefit of the restrictive covenant and the other property owner has the burden of this. Restrictive covenants stay with the land rather than with the property owner so even if the land is sold by the original owner who agreed the restrictive covenant it will remain binding on the new owner unless it is challenged and removed. You can obtain a copy of your property deed if it is registered with the Land Registry and this should reveal if there are any restrictive covenants registered against the property. If your property is unregistered then this should be included in the Deeds.
Examples of Restrictive Covenants
Some common restrictive covenants include but are not limited to:
- Not using the property to run a business
- Not building more than one residential property on the land
- Not keeping pets at the property or
- Not building boundaries above a certain height.
Breaching a Restrictive Covenant
Failure to comply with a restrictive covenant can be financially costly. There is the possibility of two types of damages being awarded against the party breaching the restrictive covenant or you may receive an injunction to prevent you from continuing the breach.
Damages may be compensatory which means the court will consider the reduction in value to the property caused by the breach to the restrictive covenant.
The court may also use damages instead of an injunction. The court will consider how much the parties could have negotiated to release the restrictive covenant and if the owner would have allowed the breach to continue if they had been aware of this.
Removing Restrictive Covenants
It can be relatively straightforward to remove a restrictive covenant. However often it is time consuming and costly to remove one, which is why it is important to contact a solicitor or conveyancer such as an experienced member of our Property Team at Hanne & Co who can assist you with this process and help you to decide the best option for your circumstance.
Restrictive covenants can be removed or varied in the following ways:
1. Application to the land registry
If we discover that the restrictive covenant is no longer enforceable then we can make an application to the land registry to remove the restrictive covenant.
2. Negotiation and Deed of Release
However, if a restrictive covenant is still enforceable then you could negotiate with the property owner who has the benefit of the restrictive covenant. If you go down this route then you may need to pay a sum of money to the property owner for them to agree to end the restrictive covenant. A Deed of Release will then need to be signed to release the restrictive covenant.
This strategy is best if you know who the parties related to the restrictive covenant are and exactly what property the restrictive covenant relates to and the full extent of the restrictive covenant. Otherwise you may be unable to obtain indemnity insurance which many mortgage lenders require to cover the risk of a restrictive covenant being enforced on the property.
3. The Lands Tribunal
You can apply to the First Tier Tribunal (Property Chamber) to release or vary the restrictive covenant if one of the below scenarios can be proven.
- The restrictive covenant is unreasonable or outdated due to changes to the property or the surrounding area.
- Removing the restriction will not cause any harm to the beneficial property.
- The property owners benefiting from the restrictive covenant are aware that you are breaching the restrictive covenant and have made no attempt to stop this breach.
However, there is no guarantee of a favourable judgment and the process can be slow as it involves preparing documents for the tribunal. It can also be costly due to the increased legal fees and tribunal fees.
How can Hanne & Co help?
If you have any queries regarding restrictive covenants on your property, contact Hanne & Co’s Property Team on 020 7228 0017.