Derreb Ltd v Blackheath Cator Estate Residents Ltd & Ors, Re Manor Way (RESTRICTIVE COVENANTS - Modification) [2017] UKUT 209 (LC)
Derreb Ltd v Blackheath Cator Estate Residents Ltd & Ors, Re Manor Way (RESTRICTIVE COVENANTS - Modification) [2017] UKUT 209 (LC)
Janet Bignell QC has secured the modifications of a restrictive covenant which stood in the way of a residential development. The Objectors objected to the significant residential development scheme for some 130 homes on a former sports ground on a private estate in Blackheath.
The modifications were made in part under ground (a) and in part under ground (aa) of section 84(1) of the Law of Property Act 1925. The decision is noteworthy and rare instance of a ground (a) application succeeding. The relevant covenant restricted the use of the land to a sports ground, alternatively to the construction of detached houses. The only residential development for which planning permission was likely to be granted, however, was for a mix of detached, semi-detached and terraced houses, and apartment blocks.
No planning permission was in fact in place at the date of the hearing of the application for modification. This is a further unusual feature of the case, as ordinarily planning permission is obtained in order to support the application to the Tribunal. The Upper Tribunal was therefore required to hear expert planning evidence on the likelihood of planning permission being granted, and the form that such permission was likely to take. The Tribunal accepted that it was more likely that permission for the housing mix outlined above would ultimately be granted.
The Tribunal was persuaded to grant an order in respect of the “sports ground” element of the covenant under the very rarely successful ground (a) - obsolescence. In so doing, it applied Re Greaves’ Application (1965)17 P&CR 57. As regards the application under ground (a) regarding the restriction confining residential development to detached houses, the Tribunal considered whether there had been a change in character to satisfy ground (a). The Tribunal decided, however, that the modification should be granted under ground (aa) instead, in that it impeded the proposed scheme which did not secure a benefit of substantial value to the objectors, even in the absence of planning permission. The Applicant also persuaded the Tribunal to remove the requirement for the Vendor to consent to plans and elevations under ground (a).The Applicant agreed to the imposition of conditions on use of the proposed estate roads to address the objectors’ concerns, under section 84(1C).
The decision is a useful illustration of the (unusually, successful) operation of ground (a), and the application of ground (aa) in the absence of planning permission, as well as an illustration of the use of the power to impose conditions in order to address objectors’ concerns.
The full judgment is here
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