Homeowners – Use Restrictions May Be Lurking in Your Title Deeds

Homeowners are often blissfully unaware that onerous restrictions on what they can do with their properties may lurk within their title deeds. However, a case in which a couple won the right to complete a barn conversion on their land shows that, with the right legal advice, such restrictions can be modified or lifted.

The couple bought their listed home from an Oxford University college for £600,000 in 2001. Its value had since risen to roughly double that sum and, with retirement in mind, they wished to sell it and convert two barns in its grounds into a new home for themselves. Planning permission for the project had been granted. The college, however, pointed to a restrictive covenant in the deeds which forbade use of the property other than for a single private dwelling house.

In resisting the couple’s application to discharge or modify the restriction, the college pointed out that 45 per cent of its income, about £6.3 million a year, comes from its landholdings. Allowing the barn conversion would set a dangerous precedent and potentially affect the college’s rights to develop neighbouring sites.

In upholding the couple’s arguments, however, the Upper Tribunal (UT) found that the restriction provided the college with no substantial value or advantage and that the barn conversion would have only a marginal effect on its future development plans. The covenant was modified to the extent required to enable the couple’s project to proceed.

However, the UT ruled that the modification should only take effect after the couple had paid £60,000 in compensation to the college. They would also be required to contribute towards the cost of maintaining and repairing an access road. The compensation was assessed on the basis that the couple would have had to pay 10 per cent more for the property had it been free from the restriction in 2001.