Paul Graham Cook v John Stove Lambourn & Anor

A restrictive covenant limiting a property to use as a private dwelling may confer practical benefits of substantial advantage by preserving the character, tranquillity, privacy and certainty of a small residential enclave. Under section 84(1)(aa) of the Law of Property Act 1925, those benefits can justify refusing a modification for short-term holiday lettings, even where physical development is not proposed.

The same considerations may establish injury under section 84(1)(c). The Tribunal must assess the particular locality and the likely effects of regularly changing short-term occupiers. A restriction’s modification may also make equivalent applications concerning nearby properties more likely to succeed.

The applicant owned a four-bedroom bungalow in Glenway, Newlyn. A 1964 covenant restricted its use to that of a private dwelling house. He applied under section 84(1) of the Law of Property Act 1925 to modify the covenant so that the property could be used for holiday lettings.

The respondents owned a neighbouring house which had the benefit of the covenant. They objected on grounds including disturbance, loss of tranquillity and privacy, erosion of the community, and the prospect of further applications affecting the small five-house enclave.

It was common ground that holiday letting would be impeded by the covenant. The central questions were whether the covenant secured practical benefits of substantial value or advantage under ground (aa), and whether modification would injure those entitled to its benefit under ground (c).

Application dismissed. The Tribunal refused to modify the covenant to permit holiday lettings.

1. The proposed use was impeded by the covenant. For ground (aa), however, the question was whether maintaining that impediment secured practical benefits of substantial value or advantage for the beneficiaries. In the particular setting of Glenway, it did.

2. Glenway was a self-contained, verdant and relatively quiet enclave of five houses. Changing one house from long-term residential occupation to a use involving regularly changing short-term visitors would be conspicuous. It would diminish the existing sense of community and certainty about the character of occupation.

3. The Tribunal rejected concerns that holiday letting would materially increase traffic or create a real security risk. It nevertheless found a significant prospect of recurrent disputes arising from noise around the pool or patio, barbecue smells and inconsiderate parking. Such disruption was more likely with a changing succession of visitors than with permanent residents.

4. Conditions limiting the types of holidaymaker allowed to occupy the property would be unworkable. The applicant’s willingness to act as a good neighbour did not resolve the longer-term concern, since future owners might not exercise the same care.

5. The covenant therefore protected tranquillity, privacy, freedom from nuisance and the assurance that the houses would remain private dwellings. Those were practical benefits of substantial advantage, so ground (aa) was not established. The same matters meant that modification would injure those entitled to the covenant’s benefit, so ground (c) also failed.

6. Following the fact-sensitive approach noted in Martin v Lipton [2020] UKUT 0008 (LC), the Tribunal held that a successful application on these facts would be likely to improve the prospects of comparable applications concerning the other Glenway properties.

not stated in the judgment.