John Bladon v Polls Yard MC Limited & Ors

Under the Law of Property Act 1925, a restrictive covenant may be modified on the reasonable-use ground only if the statutory conditions are met. These include that the covenant, in impeding the use, either secures no practical benefits of substantial value or advantage, or is contrary to the public interest, and that money is adequate compensation. Practical benefits may include preserving established arrangements for a shared development. Here, the covenant protected a settled four-household scheme from the effects of an additional household and the costly, contentious changes to shared management that would follow. Those benefits were of substantial advantage, so modification was refused. A speculative concern about setting a precedent was not itself a practical benefit.

John Bladon owned one of four homes arranged around a shared courtyard at Polls Yard. A covenant in his title restricted the property to use as a single private dwelling. After obtaining planning and listed building consents to convert a barn and garage into a second dwelling, he applied under section 84 of the Law of Property Act 1925 to modify the covenant. The other three homeowners and the management company objected, relying on the effects of an additional household and the existing shared management arrangements. The Tribunal considered whether the proposed use was reasonable and whether the covenant secured the objectors practical benefits of substantial advantage.

1. Application refused. The Tribunal found that the user covenant secured practical benefits of substantial advantage to the objectors and held that it had no jurisdiction to modify the covenant under either ground (aa) or ground (c) of section 84 of the Law of Property Act 1925.
2. The proposed conversion was a reasonable use of the land. Unlike the rural conversion considered in Thomson v Collins [2020] UKUT 330 (LC), it formed part of an existing residential development and had access wide enough for two cars. The Tribunal did not accept that the apparently omitted pavement condition in the planning permission displaced that conclusion.
3. The restriction impeded the proposed use. The Tribunal nevertheless found a substantial practical benefit in retaining Polls Yard as a four-household development. The objectors looked over the shared courtyard, and the established traffic and parking arrangements had generally worked smoothly. A fifth household would bring undesirable additional traffic and parking pressures. The benefit also included avoiding the costly and contentious negotiations needed to adapt the interlocking rights, service-charge arrangements and management-company structure for five properties. The evidence of the parties’ dispute and the management company’s recent meeting supported the conclusion that agreement to those changes was unlikely.
4. The Tribunal rejected the suggestion that preventing a precedent for other owners to seek similar modifications was itself a practical benefit. There was no evidence that another owner was likely to create an additional dwelling, and granting this application would not make a later application more likely.
5. The finding of substantial benefits disposed of the application on the reasonable-use ground; ground (c) fell away. The Tribunal made no finding on the separate consent covenant because the applicant had not applied to modify it. If the parties agreed wording to modify that covenant, they could make submissions within one month.