Restrictive Covenants

In Duffield v Gandy, Mr & Mrs Duffield wanted to build a bungalow on a corner of their land. However, their property was burdened by a restrictive covenant not to erect a residence. The Duffields applied to the Lands Tribunal for the covenant to be modified or discharged. For a list of the grounds on which such an application can be made, see April's Property update.

Mrs Gandy, a neighbour who had the benefit of the covenant, objected on the basis that the privacy of her garden would be disturbed by the proximity of the adjacent garden to the bungalow. The issue in the case was whether the practical benefits secured by the covenant were of substantial value or advantage to Mrs Gandy.

The Duffields pointed out that they could use that part of their property as a garden, without the bungalow being built, and therefore without there being a breach of the restrictive covenant. On this basis, they argued that the restriction did not secure a practical benefit of substantial value or advantage.

The Lands Tribunal refused to modify or discharge the covenant, and this decision was upheld by the Court of Appeal. In terms of practical benefits, the value of the restriction was that Mrs Gandy's privacy would be protected, not only from the erection of the bungalow itself, but also from use of an adjoining part of the property as a garden adjacent to that bungalow. The relevant risk to Mrs Gandy's privacy was the use that would be made of the garden by occupants of the bungalow. It did not matter that this benefit was derived from a restriction against the erection of a residence, rather than a specific restriction on garden use.

Things to consider

Although this decision relates to a small scale residential development, it is interesting to see the approach taken by the Tribunal. The fact that the use to which Mrs Gandy objected would, in other circumstances, be perfectly lawful, did not mean that the covenant did not give her a practical benefit of substantial value or advantage. 

This analysis was written by Sarah Allen, associate in Wragge & Co's Real Estate group.

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