Rakesh Patel & Ors v Liam Philip Spender & Ors

Under section 84 of the Law of Property Act 1925, a restriction cannot be modified under ground (aa) where it secures a practical benefit of substantial value or advantage. A covenant preserving external appearance may confer such a benefit by protecting the coherent architectural character of a building scheme.

Where a proposed modification affecting several properties creates a real risk of piecemeal, inconsistent alterations, the prevention of resulting visual incoherence may be a substantial practical advantage. The avoidance of a cumulative “ratchet” effect, by which later modifications become easier and progressively erode the estate’s character, may also be such a benefit. Short-term construction disturbance, where the covenant is not directed to building works, is not ordinarily a substantial practical benefit.

Eleven owners of freehold houses at St David’s Square applied to modify an alterations covenant under section 84 of the Law of Property Act 1925. They wished to construct rear ground-floor extensions and roof conversions, including dormers with Juliet balconies, or alternatively Velux windows.

The covenant formed part of a building scheme and prevented alterations substantially affecting the houses’ external appearance. Residents and estate freeholders objected, relying on alleged nuisance, pressure on communal facilities, tree loss, overlooking, disturbance, architectural change and the implications for future applications.

The central issue was whether the covenant, in impeding the accepted reasonable use of the houses, secured practical benefits of substantial value or advantage for the objectors within section 84(1)(aa).

1. Application refused. The Tribunal had no jurisdiction to modify the alterations covenant because it secured practical benefits of substantial advantage under section 84(1)(aa) of the Law of Property Act 1925.
2. The proposed works were a reasonable use of the applicants’ land. However, the covenant did not confer practical benefits by preventing additional HMO occupation, pressure on estate facilities, removal of trees, or material loss of privacy. The existing HMO licences already permitted six occupants, other covenants dealt with nuisance and tree removal, and the additional overlooking in this dense development was minimal and not of substantial value or advantage.
3. The covenant did protect the architectural unity of a carefully designed building scheme. Modification for all eleven houses created a real likelihood that extensions would be completed inconsistently, at different times, or not at all. The applicants’ proposed covenant to carry out all works together gave no reliable assurance against that result and would be difficult to enforce. Piecemeal dormers, Velux windows and rear extensions would make the presently coherent development visually incoherent and out of keeping with the estate.
4. The Tribunal also accepted the “ratchet” concern explained in Morris v Brookmans Park Roads Ltd [2021] UKUT 125 (LC). A substantial initial change would alter the context for later section 84 applications and make further erosion of the estate’s character more likely. Preventing that cumulative effect was a further practical benefit of substantial advantage.
5. Construction disturbance was temporary and the covenant was not designed to prevent building works. It was therefore not a substantial practical benefit. Nor, had jurisdiction existed, would the applicants’ personalities or past conduct have justified refusing relief. The covenant remained unmodified.

not stated in the judgment.