What is a restrictive covenant?
A restrictive covenant is frequently found in relation to the use of residential property. A restrictive covenant is a clause preventing a property owner from certain acts in relation to the property, or otherwise restricts their use of the property in some way.
This is for the benefit of someone else – usually a neighbouring property. However, in practice it can be very difficult to identify who has the benefit of a restrictive covenant. Typical restrictive covenants include:
- Not to build or construct any buildings on the property;
- Not to build walls or erect fences above a certain height;
- Not to use the building for any business or trade;
- Not to erect any signages to the front of the property.
Under land law, restrictive covenants ‘run with the land’. This means they bind all successive purchasers/owners of the property (unless the terms of the covenant state otherwise). It is possible for a restrictive covenant to be discharged by agreement with the person who has the benefit of the restrictive covenant. If necessary, an application can be made to the Lands Tribunal for an order discharging or modifying the restriction; for instance, if the restrictive covenant is interfering with the use of the land.
Common types of restrictive covenants
Restrictive covenants in leases
If the property is subject to a lease, there will be restrictive covenants contained within the lease – typically found under the heading ‘Covenants’. Common restrictive covenants in a lease include:
- Not to cause nuisance to your neighbour;
- Not to remove any internal walls;
- Not hang washing over the balcony;
- Not have any pets in the property;
- Not to sublet the premises.
Leaseholders generally impose restrictive covenants in leases to ensure the property remains in good repair, or to ensure that all residents in a block of flats can live together peacefully. All leaseholders within a block will likely be subject to the same covenants so they are all beneficial to each other for the same reasons.
Who does a restrictive covenant apply to?
Restrictive covenants apply to buyers of land that is already subject to restrictive covenants, as well as leaseholders. Buyers of new builds are also highly likely to be subject to restrictive covenants set out in the transfer which will affect their use of the property.
On exchange of contracts, the buyer is effectively agreeing to abide by any restrictive covenants that affect the property they are buying – unless the clause specifically states a period of time after which it is to end.
How can I determine if my land is affected by a restrictive covenant?
Most property is now registered with HM Land Registry. If you want to find out if your existing property is subject to a restrictive covenant, you can apply to the Land Registry for a copy of your Registered Title and Title Plan for a small fee (see www.landregistry.gov.uk). The title as registered with the Land Registry will include details of any restrictive covenants affecting your property in the section headed ‘Charges Register’. There may be reference to other documents such as a Transfer, Conveyance or a Deed of Covenant (ie. the original Title Deeds which contained the Restrictions). If the title states ‘Copy in Certificate’ this means the Land Registry has a copy of the original document and you can request a copy of this if required.
The Title Plan may help you understand, by way of coloured lines and shading, what part or parts of your property is affected by any restrictive covenants affecting your land – particularly if the restrictive covenant is not straightforward.
If the land is unregistered, the Land Registry will not have any information about the property. However, it may have information about neighbouring properties which have the benefit of any restrictive covenants. In the case of unregistered land, the original title deeds and documents will contain information as to any restrictive covenants affecting the property.
If you cannot locate the original deeds, or some are missing, you could obtain information from the Land Registry on the neighbouring properties. If a property owner is trying to enforce a restrictive covenant against you about which you have no knowledge, you can ask them to show you their title deeds/Land Registry documents so that you see details about the restrictive covenant. However, the Official Title of registered property may not include details of the benefit of restrictive covenants – the Land Registry does not have to include them on a registered title.
What happens if I breach a restrictive covenant?
If you buy a property that is subject to a restrictive covenant you will be bound by its terms, unless it is not reasonable or practical. If you breach a restrictive covenant, the landowner/landlord with the benefit of the restrictive covenant can take enforcement action against you. For example, if you breach a restrictive covenant in your lease, your Landlord may be able to terminate your lease or impose charges on you.
The person with the right to take action against you for breach of a restrictive covenant should contact you to inform you of the breach, and ask you to put it right. If your breach has caused a loss, they can ask for compensation and insist you put right your breach. If the matter cannot be resolved, the court may be asked to order an injunction against you to prevent further breach of the restrictive covenant. The court can order damages instead of an injunction.
We strongly recommend you take legal advice from specialist property solicitors for further information about restrictive covenants.