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Housing Development Undermined by Restrictive Covenant

houseMany housing estates are subject to restrictive covenants for the benefit of present and future residents and they can act as a control mechanism on development that is just as effective as the planning system. In one case that illustrated the point, a planning consent granted for the demolition of a house and its replacement by four new dwellings was deeply undermined.

The case concerned an estate of 36 housing plots that had been developed en bloc in the 1970s. All the original house purchasers had agreed to a restrictive covenant which, amongst other things, forbade use of each property for any purpose other than that of a single dwelling house for the occupation of a single family.

After a couple that owned one of the houses obtained the consent, their neighbours on each side launched High Court proceedings and were granted a declaration that the covenant was binding on all present and future residents of the estate. It was a paradigm example of a building scheme in which there was a common intention between the original vendor and purchasers that the covenant would be for the mutual benefit of all residents and would be enforceable against successors in title. In granting summary judgment, the Court found that the couple had no real prospect of successfully defending their neighbours’ claim.