Discharge of Covenants
UK Cases Discharge
In Re Truman Hanbury Buxton & Co Ltd’s Application
[1956] 1 QB 201 (CA) Evershed MR, Romer and Birkett LJJ
Romer LJ:
The particular ground upon–WJ,ich the application was made, and upon which it is now still sought to support it, is that the covenant in question ought to be deemed obsolete within the meaning of subsection (1)(a) of section 84, having regard to the changes which have taken place in the character of the property or the neighbourhood since 1908.
It seems to me that if, as sometimes happens, the character of an estate as a whole or of a particular part of it gradually changes, a time may come when the purpose to which I have referred can no longer be achieved, for what was intended at first to be a residential area has become, either through express or tacit waiver of the covenants, substantially a commercial area. When that time does come, it may be said that the covenants have become obsolete, because their original purpose can no longer be served and, in my opinion, it is in that sense that the word ‘obsolete’ is used in section 84(1)(a) …
If serious injury would result to the opponents and others if the covenant was discharged (and having regard to the proposed user for the benefit of motor-coach travellers between Southend and London, it is very easy to imagine the kind of result that would happen) I cannot see how, on any view, the covenant can be described as obsolete, because the object of the covenant is still capable of fulfilment, and the covenant still affords a real protection to those who are entitled to enforce it.
In Re Bass Ltd’s Application
(1973) 26 P & CR 156
J.S. Daniel QC:
I am by no means satisfied that to stop this proposal would be contrary to public interest. There is a private interest, of course, and to serve the private interest of so large a concern as Bass Limited which performs so useful and agreeable a function does to some extent serve the public interest, but that is really as far as it goes, and I do not think it goes far enough…
The proposition that this operation is in the public interest25 is strange indeed unless the public interest is to be equated to the economic benefits to this particular part of the beer trade. Of course such benefits are not to be ignored; they are part of the situation as a whole, but they cannot possibly be allowed to override everything else. It is difficult to isolate this issue…
The residents of City Road are already subjected to noise which is not only undesirable but is beyond the limit of what is acceptable. And this application proposes to increase it. In that situation I feel quite unable to be satisfied that impeding this proposal does not secure to the objectors benefits of substantial value or advantage. The objectors’ evidence made it very clear how they feared and disliked this proposal. It does not seem to me that any authority is needed for the proposition that prevention of sucha proposal and therefore the assuaging of the fear and dislike it engenders is indeed a benefit of substantial advantage.
It is not only the noise. That perhaps is the factor most amenable to measurement, difficult though that is. Fumes, vibration, dirt, the appearance of things and the risk of accidents, all add to the aggregation of debits, and cumulatively strengthen my opinion that in impeding this proRosal the objectors do secure practical benefits of substantial value and advantage… It follows that the application must be refused.
In Re Lloyd and Lloyd’s Application
(1993) 66 P & CR 112 (Lands Tribunal), Judge Marder QC27
Marder QC:
As to ground (aa) it is not disputed that the applicants’ proposal would represent a reasonable use of the property which is _impeded by the restriction. In my judgment the restriction in impeding that user is contrary to the public interest.
I am conscious that the Lands Tribunal in considering the public interest point on many occasions has never before modified or discharged a covenant on this ground in similar cases… However, in the light of government policy, local need, the adequacy of the Lloyds’ house and their suitability to run the proposed home, he concluded:
In the light of these findings, I am satisfied that the restrictive covenant in preventing that use is contrary to the public interest, and I would be prepared to grant the proposed modification on this ground.
Furthermore, in relation to the other limb of ground (aa), I do not consider that in impeding the user of the subject property as a residential care home, the restriction confers any substantial benefit or advantage on the beneficiaries…
There is no evidence to suggest that the conduct of the proposed occupiers, being people with problems of mental illness in course of rehabilitation, would be more or less objectionable or anti-social than if the property were occupied, for example, as a boarding house [permitted under the restrictive covenant] for 10 residents chosen at random from the community at large.
As to ground (c), for reasons already stated, I do not consider the modification sought will injure those entitled to benefit..
Texaco Antilles Ltd v Kernochan
[1973] AC 609 Privy Council (Lords Cross, Morris and Salmon)
Lord Cross of Chelsea:
‘As soon as the two sets of lots come into the same hands, it became impossible for any action to enforce the covenants to be brought by the owner of one set against the owner of the other since he was the same
person and that fact, so the argument runs, puts an end to the restrictions so far as concerned the relations of the two sets of lots inter se …
The point of law which arises for consideration is, therefore, whether in a case where there is nothing in the conveyance putting an end to the unity of seisin or in the surrounding circumstances to indicate that the restrictions in the schc;:me are no longer to apply as between the owners of the lots previously in common ownership the fact that they have been in common ownership puts an end to the restrictions so far as concerns the relations of subsequent owners for the time being of that part of the estate inter se so that if the common owner of those lots wished them to apply after the severance, he would have to reimpose them as fresh restrictions under a sub-scheme relating to them.’
It would, their Lordships think, be somewhat unfortunate if this was the law … It is no doubt true that if the restrictions in question exist simply for the mutual benefit of two adjoining properties and both those properties are bought by one man, the restrictions will automatically come to an end and will not revive on a subsequent severance unless the common owner then recreates them. But, their Lordships cannot see that it follows from this that if a number of people agree that the area covered by all their properties shall be subject toa ‘local law’, the provisions of which shall be enforceable by any owner and the whole area has never at any time come into common ownership, an action by one owner of a part against another
owner ofa part must fail if it can be shown that both parts were either at the inception of the scheme or at any time subsequently in common ownership.’
Tiltwood, Sussex, Re; Barrett v Bond
[1978] Ch 269 Chancery Division (Foster J)
Where the fee simple of the benefitted and burdened land is vested in one person, the restrictive covenants are extinguished unless the common owner recreates them. The covenant had ceased to exist, did not revive on severance and it made no difference that the conveyance upon the severance expressed the property to be subject to the non-existent covenant.
Truman, Hanbury, Buxton & Co Ltd’s
[1956] 1 QB 261 Court of Appeal (Romer LJ)
D
RomerLJ:
‘The meaning of the term “obsolete” may well vary according to the subject-matter to which the term is applied … Here … we are concerned with the application of the term to restrictive covenants as to user and these covenants are imposed when a building estate is laid out, as was the case with this estate which was laid out in 1898, for the purpose of preserving the character of the estate as a residential area for the mutual benefit of all those who build houses on the estate or subsequently buy them. If, as sometimes happens, the character of an estate as a whole, or of a particular part of it, gradually changes, a time will come when the purpose to which I have referred can no longer be achieved, for what was intended at first to be a residential area has become, either through express or tacit waiver of the covenants, substantially a commercial area. When that time comes, it may be said that the covenants have become obsolete, because their original purpose can no longer be served and, in my opinion, it is in that sense that the word ‘obsolete’ is used in s84(l)(a).
… The Tribunal came to the conclusion … that the discharge or modification of the covenant so as to permit the erection of on-licensed premises on the land would seriously injure persons admitted to be entitled to the benefits of the covenant: not one or two people, be it noted, but persons in general.
If this serious injury would result to the objectors and others if the covenant were discharged … I cannot see how, on any view, the covenant can be described as obsolete, because the object of the covenant is still capable of fulfilment and the covenant still affords a real protection to those who are entitled to enforce it … I think that the finding that the discharge for which the applicants asked would seriously injure these persons renders it almost impossible to say that the covenant had become obsolete … ‘