James Anthony Farrell v Hugh Garforth-Bles & Anor

Under section 84 of the Law of Property Act 1925, satisfaction of a statutory ground gives the Tribunal a discretion to modify a restrictive covenant; it does not require modification. A covenant is not obsolete where its original purpose remains capable of fulfilment and continues to provide real protection. For ground (aa), the proposed use must be reasonable and the covenant must impede it. The Tribunal must then assess whether the covenant secures practical benefits of substantial value or advantage to those entitled to its benefit. Benefits protecting neighbouring residential amenity from noise, fumes, loss of privacy and reduced security may satisfy that test. A broad and uncertain application may be assessed by reference to a realistic worst-case scenario.

The applicant owned a detached property adjoining Bishop’s Mansions. Restrictive covenants limited its use principally to residential purposes and professional offices and excluded various commercial and potentially disruptive uses.

The applicant sought modification to permit wider uses within planning Class E, including retail and café use. The objectors relied on the continuing protection of residential amenity, privacy and security. The application was made under grounds (aa), (b) and (c) of section 84 of the Law of Property Act 1925, with ground (a) also considered. The central issues were whether the covenant was obsolete, whether it impeded a reasonable use without securing practical benefits of substantial value or advantage, and whether modification would injure the beneficiaries.

1. Discretion under section 84. Section 84 confers a discretion. Even if one of the statutory grounds is established, the Tribunal may, but need not, discharge or modify the covenant.
2. Ground (a). Following the approach in Adams’ Application [2018] UKUT 411 (LC), the Tribunal identified the covenant’s purpose, considered changes in the property and neighbourhood, and asked whether the restriction had become obsolete. The covenant was intended to ensure compatibility between the property and the neighbouring residential development, particularly by controlling noise and disturbance. That purpose remained capable of fulfilment. Changes in planning classifications had not materially altered the character of the property or neighbourhood and did not make the covenant obsolete.
3. Ground (aa). Retail and coffee-shop use were reasonable uses and were impeded by the existing covenants. The relevant question was whether the continued restriction secured practical benefits of substantial value or advantage. Increased footfall and traffic did not meet that threshold. However, the covenant protected neighbouring residents from likely noise and fumes, particularly from use of the rear garden, and preserved privacy and security by controlling access and the presence of customers near residential windows and communal areas.
4. The application was unusually wide and nebulous. It was therefore appropriate to assess a realistic worst-case scenario. The identified benefits were individually, and more strongly in combination, of substantial value or advantage. Grounds (aa) and (c) were not made out, and the Tribunal lacked jurisdiction to grant the application.
5. Order: the application was refused.

This was an application to the Upper Tribunal (Lands Chamber) under section 84 of the Law of Property Act 1925. The decision records a right of appeal to the Court of Appeal on a point of law, with permission.