What are Restrictive covenants on a home
- Posted by:
- Admin
- Tags:
- COVENANTS, PROPERTIES, FREEHOLD
- Posted date:
- 07-08-2021
Do You Want To Find Out More About Restrictive Covenants On A Home? Kent Property Witness offer RICS expert witness surveyor services for Tonbridge and Kent. We Ask What Are Restrictive Covenants On A Home And How A Covenant Is Enforceable.
Restrictive Covenants on Freehold Properties Explained
A restrictive covenant is a legally binding rule tied to your property deeds. In short, these rules control what you can or cannot do with your property or piece of land.
They will take the form of agreements within your title deed itself, restricting the use of your land or house in some specific way.
These restrictions are generally to protect neighbours properties or the area surrounding yours, and they are transferred to any future owner of your property.
If you purchase a piece of land or property, you should make yourself aware of any restrictive covenants that form part of the title deeds.
A solicitor will be able to check the land or house on your behalf, offering legal advice on whether any covenants are tied to it.
You can also search the Charges Register to see if there are covenants tied to your property.
You can find restrictive covenants on both old buildings and new ones, with more and more developers choosing to place covenants on their newer properties. This is to prevent their tenants or buyers from making major alterations to the properties. If the tenant/buyer does make alterations, they will have to pay significant compensation fees.
Restrictive Covenants on Freehold Properties Explained
Covenants are entirely enforceable between the two initial parties it was created between, allowing the beneficiary to take legal action if it is breached, allowing the beneficiary. This is purely a matter of contractual obligation. However, there are certain circumstances in which the beneficiary cannot enforce a restrictive covenant:
- If the covenant is too vague or uncertain to be legally enforceable.
- If the covenant cannot be enforced due to competition law.
- If the covenant contradicts public policy, for instance, it goes against modern equality laws.
- If the developer or seller who created the covenant (beneficiary) assigned their benefit of the covenant over to a third party.
Another instance might be that the person seeking to enforce the covenant is a successor in title to the original seller or developer who created it. In this case, particular conditions must be met before the covenant becomes enforceable.
When is a restrictive covenant enforceable?
The specific conditions that successors in title to the original parties who created the restrictive covenant must meet to enforce the obligations follow particular rules. These rules control the transfer of benefit from the burdened land that the covenant is tied to.
In essence, the land tied to the restrictive covenant, and the obligations detailed in the agreement, must benefit the person seeking to enforce the covenant if they are a successor. Otherwise, they will be unable to enforce the obligations of the covenant.
The restrictive covenant must 'touch and concern the land of the owner seeking to enforce it. Therefore, the covenant must affect the land specifically and not merely benefit the original parties personally. A covenant may 'touch and concern' a piece of land under these conditions:
The covenant is of benefit to the landowner for the time being, and if they are separated from the land, it stops being of benefit to them.
The covenant affects the land's nature, quality, uses or value.
The covenant affects the land's nature, quality, uses or value.
The wording of the covenant is not expressed in personal terms.
For the restrictive covenant to be enforceable, it must preserve or improve the value of the land it is tied to. In the courts, whether a covenant benefits the land it controls is a vague area.
So long as the covenant is "capable" of benefiting the land, it does. Whoever contests the positive attributes of the covenant must prove that it does not directly benefit the land.
To enforce the covenant, the person seeking to do so must be the owner of the land or property in law or a person with a diminished interest that is recognised as having an equal stake. This includes:
Any person contracted to purchase the freehold from the owner.
Any person benefitting from the covenant through a will.
A trustee of the covenant facing bankruptcy.
A person to whom the benefits of the covenant have been passed.
The beneficiary of a restrictive covenant on land or property can pass it to someone through one of three ways:
Annexation of the land or property.
Having the benefits assigned to them in law.
Development schemes.
Certain restrictive covenants are unenforceable under specific government acts and legislation. The Competition Act of 1998 and the Land Agreements Exclusion Order prohibit specific restrictive covenants from being enforced in court.
Also, while the benefits of restrictive covenants can be passed on through common law, the burdens of the covenant cannot. Therefore, whoever purchases the lands or properties to which the covenant is tied is obligated to fulfil the terms detailed in it.
Examples of Restrictive Covenants
Restrictive covenants can cover a wide range of obligations regarding the land or property they cover. However, some of the most common restrictive covenants and general examples of them include:
Covenants to limit the use of a piece of land.
Restricting any alterations you could make to a property.
Limiting the use of the property for purely residential purposes, barring any commercial or business practices.
Depending on the specific wording of the covenant, you may be allowed to make alterations to the land or property without breaching the covenant. However, it would be best if you were prepared to pay a fee to receive consent from the beneficiary of the covenant. Restrictive covenants do not prevent you from applying for planning permission.
How Can a Restrictive Covenant Affect Me?
Of course, having legal restrictions on what you can do with your land or property can be difficult. Before you even purchased the land or property, your solicitors should have informed you of any restrictive covenants tied to it, and therefore and restrictions that you might need to abide by.
This way, you will have purchased the land or property with all the necessary knowledge and have gone through the purchasing process knowingly and willingly.
Restrictive covenants are not always meant to hamper your use of your new land or property. Covenants have been used for a very long time, and many older or listed properties will have them.
The restrictive covenants attached to these period houses are designed to prevent alterations and maintain the property's historical significance. They are not there to burden the owner but to protect the property.
On the other hand, developers of newer housing could create restrictive covenants to keep a degree of control over new homeowners. Through covenants, they can restrict the use of gardens, pet ownership, satellite dishes, and even washing lines.
Those subject to these obligations will need to pay a fee and gain the consent of the original developer if they wish to make these sorts of alterations. Some developers may even place covenants on their properties to restrict who they can be sold to and for what price.
But they are not all bad news, as some restrictive covenants are put in place to protect your property.
For example, a restrictive covenant may be in place on your house which prevents your neighbour from making alterations to their property that could negatively impact the value of your property.
How do I challenge a restrictive covenant?
There are two main routes through which you can challenge a restrictive covenant on your land or property:
Indemnity insurance: many insurance policy providers offer indemnity insurance against the risk of a buyer inadvertently breaching the terms of a covenant tied to their land or property. Even if the insurance covers the fees incurred, proposed changes to the property will still need the consent of the covenant's beneficiary.
Lands Chamber of the Upper Tribunal: if no insurance is available, you cannot get the beneficiary's consent, or you cannot contact them, taking the restrictive covenant to the Lands Tribunal of England and Wales is another route. The tribunal can alter or cancel restrictive covenants if they fall into several categories:
Are you looking for advice about property valuation for covenants in Tonbridge and Kent? Contact our expert witness surveyor and give us a call about any information about property advice.