Conveyancing case law : Restrictive Covenant trumps Planning Permission

The recent court of appeal decision in  Davies v Dennis and others [2009], illustrates the common pitfall of failing to check whether the proposed development is permitted from a land title perspective on the basis planning permission has been obtained.

The parties to the case lived on Heron Island in the River Thames, at Caversham, near Reading. In the mid-1980s the island was developed by Heron Homes Limited ('Heron') as a residential estate comprising 47 three-storey houses. The judge said this of the development:

'16. … A particular feature of the development was its closeness to the river and the views that each house was afforded of the Thames. The island was described in the advertising brochures at the time as a unique development "lapped by the waters of the Thames on three sides" and, as providing purchasers with a "waterside lifestyle". The open river views were a feature of the development and many houses were also given mooring rights. Nearly every house has a waterside frontage. Views of the River are gained by deliberately designed gaps between the houses and the houses have been carefully orientated in order to take advantage of the river view. '

Each transfer included a series of restrictive and positive covenants by the purchaser, some with just Heron and Peverel, others both with them and with the owners for the time being of other plots on the estate.

Clause 4 of the Transfer stated : 'The Purchaser for himself and his successors in title and with the intent to bind the Plot into whosoever hands the same may come hereby covenants with the Vendor and the Management Company and also as a separate covenant with every other person who is now the owner of any part of the Estate for the benefit of the remainder of the Estate including any part thereof for the time being unsold to observe and perform the restrictive and other covenants and stipulations set out in the Third Schedule hereto PROVIDED THAT nothing herein contained shall prevent the Vendor or its successors in title from selling or otherwise disposing of any part or parts of the Estate free from any restriction or stipulation or from waiving compliance with or agreeing to vary any restriction or stipulation now or hereafter affecting any part of the Estate nor be deemed to create a building scheme. '

The Key covenants in the Transfer set out:

'1. Not to erect on the Plot or any part thereof any building whether of a permanent or temporary nature except such as shall be in accordance with plans and elevations which shall have been approved in writing by the Management Company and whose proper and reasonable fees shall be paid by the persons submitting such plans and elevations for approval
2. Not to use the Dwellinghouse for any purpose other than that of a private residence or ancillary thereto and not to carry on from the Plot or any part or parts thereof any trade business or manufacture whatsoever nor to do or suffer to be done on the Plot or any part thereof anything of whatsoever nature which may be or become a nuisance or annoyance to the owners or occupiers for the time being of the Estate or the neighbourhood …
4. (a) Not to allow the wall fence or boundary posts along those boundaries of the Plot indicated by a "T" within the boundary on Plan 1 nor the rear wall or fence to fall into disrepair but to maintain the same in good condition
(b) Not at any time to erect or permit to be erected along any of the boundaries of the Plot any boundary structure of whatsoever nature other than as may exist at the date hereof (and where only boundary marker posts exist along such boundary not to erect any boundary structure of whatsoever nature) without the written consent of the Management Company which shall be entitled to grant or withhold its consent entirely at its discretion
(c) Not to erect construct or plant in front of the front or side building line any wall fence gate or other means of enclosure without the written permission of the Management Company and the Local Planning Authority'
In the original hearing in the High Court the judge had to decide three issues. First, whether on its true construction the covenant in paragraph 2 above applied to Mr Davies' proposed building works at all. Second, if it did, whether the works would be or become a 'nuisance or annoyance' to the claimants within the meaning of that covenant: only if they did would there be a breach. Third, whether Mr Davies had a written approval to carry out the works for the purposes of the covenant in paragraph 1 of the above schedule.

The judge decided all three points against Mr Davies.

The Court of Appeal upheld the High Court decision held that the covenant not to annoy or cause nuisance:

  • applied to the proposed extension works. The proposed extension was capable of being a nuisance, whilst being built, and even once built.
  • was not made void by any permission given to carry out the extension, further to a separate obligation not to build without the prior consent of the management company.

Conveyancing lawyers and purchasers alike should take note that such covenants cannot be dismissed when considering the possibility of developing or even extending a property.