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Modification and discharge

Introduction

A developer or other person seeking to get round a restrictive covenant has four possible options - depending on the circumstances:
  • Go to the High Court for a declaration stating that the restrictive covenant is not enforceable for one reason or another.
  • Accept that the covenant is valid but ask the Upper Tribunal (Lands Chamber) (what used to be known as the Lands Tribunal) for an order discharging or modifying the restrictive covenant.
  • Insurance?? Not very likely once any sort of dispute has arisen.
  • Do a deal with the objectors and potential objectors / mediation.
This page is concerned with applications to the Lands Chamber to modify restrictive covenants under s84 of the Law of Property Act 1925 so as to allow the development to go ahead. Note the use of the word "modify" and the absence of the word "discharge". The Lands Chamber has the power under s84 to discharge or modify restrictive covenants. However, the Tribunal will very rarely discharge a covenant. They will, in an appropriate case, instead modify the covenant so as to allow the development to take place. If that is done the question of compensation also has to be considered.

The article on this page, amongst other things:
  • Sets out the grounds upon which a restrictive covenant can be modified (or discharged)
  • Deals in detail with the most common ground - "reasonable user".
  • Explains how compensation is assessed when the covenant is modified on the user ground.
  • Outlines the Lands Chamber procedure.

The grounds

There are four grounds that can be relied upon. They can be summarised as follows:

(1) Changes in the character of the property or the neighbourhood or other circumstances mean that the restriction ought be deemed "obsolete" (s84(1)(a)). Reliance on this ground is rarely successful and including it in the application can lead to adverse costs consequences.

(2) The continued existence of the covenant would impede some reasonable user (s84(1)(aa)). ... THIS IS AN EXTRACT OF THE FULL TEXT. TO GET THE FULL TEXT, SEE BELOW

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