Hae Developments Limited v The Croft Ealing & Anor

A restrictive covenant may be discharged as obsolete under section 84(1)(a) where changes in the neighbourhood have made its original protective purpose superfluous. In assessing injury and practical benefit under section 84, the Tribunal must identify the actual protection conferred by the covenant. Alleged disadvantages do not constitute a practical benefit where the covenant would permit materially similar effects from a realistic single-dwelling development, or where the alleged effects are illusory.

Planning controls and the surrounding development may confirm that a proposed housing use is reasonable. Where discharge causes no loss or disadvantage protected by the covenant, compensation is not payable.

The applicant held planning permission to demolish a two-storey house at 26A and 26B Park Hill, Ealing, and replace it with a building containing eight flats. Covenants imposed in a 1955 transfer restricted construction and use to one private dwellinghouse, while also prohibiting business use and nuisance or annoyance.

The freeholder and leaseholders of the adjoining development, The Croft, objected. They relied on overlooking, loss of light, noise, parking, construction disturbance and alleged diminution in value. The applicant sought discharge or modification under Law of Property Act 1925, section 84(1)(a), (aa) and (c).

The central issue was whether the covenants were obsolete or secured practical benefits whose loss would injure the objectors.

1. The application was granted. The Tribunal discharged the single-dwellinghouse restrictions because they were obsolete under section 84(1)(a) of the Law of Property Act 1925. It also held that ground (c) was made out and that ground (aa), though unnecessary, would likewise have justified relief.

2. The relevant purpose of the 1955 covenants was to protect The Croft from adjoining flats. That purpose had become superfluous. The Croft had itself been redeveloped into blocks of flats and maisonettes, while nearby development and planning permissions showed substantial change in the neighbourhood. The proposed building was consistent with its setting and planning permission.

3. For grounds (c) and (aa), the Tribunal first construed the covenants’ actual scope. They imposed no restriction on height, size, boundary distance, flank windows, rear windows, overlooking, views or loss of light. A realistic compliant single dwelling could have three storeys and windows causing materially similar effects. The alleged benefit of preventing overlooking or loss of light was therefore not secured by the covenants.

4. The remaining alleged harms did not establish practical benefits of substantial value or advantage. The proposed building was not overbearing, parking was controlled by planning and traffic arrangements, and noise, light and cooking smells would add little to the intensive residential environment already surrounding The Croft. Construction disturbance was not prevented by the covenants. Applying Shephard v Turner [2006] EWCA Civ 8, a covenant against nuisance or annoyance would not be breached by that disturbance.

5. There was no protected loss or disadvantage and thus no basis for compensation. The Tribunal discharged the restriction on more than one dwellinghouse, retained the restrictions on business use and nuisance or annoyance, and discharged the unclaimed Victorian covenants as obsolete.

not stated in the judgment.