Young Cammiade, An Application by

Section 84(1) of the Law of Property Act 1925 concerns restrictions on the physical use of land or buildings. It does not extend to a restriction which merely prevents registration of a transfer or lease without consent. The possibility that such a restriction may affect who can acquire the land, or may indirectly affect whether it is occupied, does not make it a restriction as to user. The Upper Tribunal therefore has no jurisdiction under section 84 to discharge it. Separately, a contractual discretion to refuse consent will ordinarily need to be exercised honestly, rationally and for the purpose for which it was conferred where its exercise adversely affects the other party.

The applicant held a long lease of a flat. A restriction had been entered on the register preventing registration of a transfer or lease without the consent of the owner of another flat. The restriction appeared to derive from a deed intended to preserve mutual covenants between the flat owners.

The applicant sought its discharge under section 84 of the Law of Property Act 1925. The central issue was whether a restriction controlling registration of a disposition was a restriction as to the user of land within section 84(1), extended to qualifying leasehold covenants by section 84(12).

1. Application dismissed. The Upper Tribunal had no power under section 84(1) to discharge the restriction.
2. Section 84(1) is concerned with restrictions as to what may lawfully be done on land or in buildings. “User” refers to the activity conducted on the land and the purpose for which it is used. The reference to reasonable user in section 84(1)(aa) similarly concerns long-term use rather than the process of transition to such use, as explained in Shephard v Turner [2006] 2 P & CR 28.
3. The restriction was negative in form, but its subject matter was registration of a transfer or lease. It did not directly or indirectly regulate the lawful use of the flat. The fact that it might limit the class of persons able to become registered proprietors, hinder a sale, or temporarily result in the flat being unoccupied did not convert it into a restriction as to user.
4. The distinction between positive covenants and restrictions as to user was consistent with Westminster City Council v Duke of Westminster [1991] 4 All ER 136 and Re Blyth Corporation’s Application (1962) 14 P & CR 56. Re Milius’s Application (1995) 70 P & CR 427 had not decided the jurisdictional question; its suggestion that free disposition might in practice restrict user was only an argument which the Tribunal had not needed to determine.
5. As an obiter observation, the consent restriction was not necessarily an unfettered discretion. In the apparent context of preserving mutual covenants, a refusal unrelated to that purpose might fall outside the intention of the covenanting parties. A contractual discretion adversely affecting another party’s interests will usually be exercised honestly, rationally and for the purpose for which it was conferred.