In this article, Commercial Property Solicitor Patsy Whitford looks at the implications of having a restrictive covenant on a property that you own or are looking to buy.
Patsy goes on to outline what happens when a covenant is breached and discusses how you can remove a covenant from your property.
What is a restrictive covenant on property?
A restrictive covenant (RC) is something that is recorded against your property and normally restricts you from doing something. Here's some examples of restrictive covenants:
- Changing the look of the outside of your house,
- Putting up an extension, or
- Using your property for commercial use.
Those are some pretty common restrictive covenants.
It is worth noting that restrictive covenants are completely independent from a planning permission, so you do not automatically get consent to a breach of restrictive covenant if you have obtained planning permission.
What are some examples of restrictive covenants?
The most common and problematic covenants prevent changes to a property, such as altering the existing property or preventing new constructions or a change of use.
That said, restrictive covenants come in a number of different forms, from incredibly restrictive as described above, down to less relevant ones such as prohibiting extraction of sand to make bricks or preventing you from keeping pigs!
Do restrictive covenants devalue a property?
They can do, as there is such a broad level of what is restricted.
Can I build on land with a restrictive covenant?
Hopefully, yes! There are a number of ways of dealing with restrictive covenants from getting an indemnity policy to cover the risk if someone seeks to enforce the covenant to obtaining the consent of the person who benefits from the restrictive covenant.
As every restrictive covenant is different, the options available to deal with it are different.
However, as a word of warning, you must be very careful when dealing with RCs as trying to obtain consent from the relevant person removes your ability to get indemnity insurance.
What happens if you breach a restrictive covenant?
The person who has the benefit of the restrictive covenant can seek to enforce it.
Worst case scenario, you could have to demolish any building built in contravention of the covenant or make a significant payment for retrospective consent.
There is also no set payment scale for consent to a breach of restrictive covenant, so this could be very pricey!
How enforceable is a restrictive covenant on property?
Unfortunately, there is no clear-cut answer as it depends of the wording of the covenant.
The age of the restrictive covenant also doesn’t help to establish its enforceability as there are many landowners that still hold an interest in RCs put in place many years ago.
The rule of thumb is, if in doubt then its enforceable.
What can I do if the property I’m buying has a restrictive covenant?
Consider if the restrictive covenant will impact on your intended use of the property.
If the RC says you cannot use the property as a shop and you want to live there, then you may not be too concerned about it.
The best idea is to take legal advice and your adviser will be able to recommend the best course of action.
If the covenant will prevent you from using the property as you want to, and there is no suitable course of action to limit your risk, you may want to reconsider your purchase, as this could affect no only your use of property but a future sale.
Can I remove a covenant from my property?
The short answer is yes, but this can be a very involved process.
You can either approach the person with the benefit of the RC to get consent to vary or remove the RC or you can apply to the Lands Tribunal.
The second option can be a very long and expensive process with no guarantee of success and the criteria you would have to prove is very strict.
Commercial Property and Covenant Removal Solicitors
If you are concerned about a restrictive covenant on your property or one you intend to buy, please contact our specialist Commercial Property & Restrictive Covenant Solicitors.
The process of removing a restrictive covenant can be quite complicated. At Frettens, our bright, experienced team of solicitors would be happy to look into whether or not its possible to vary or remove such a covenant from your property.
We’d be happy to advise you over a free initial chat.
Call us on 01202 499255 or fill out the form at the top of the page.
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