You need to be cautious of potential unexpected costs and restrictions when buying a residential property. One of our conveyancing experts Elton Ashworth looked at a recent case which went where a clause went undetected, ultimately affecting the sale of the house.
Covenants that restrict the use to which properties can be put lurk undetected within many title deeds and can have a dramatic impact on a property’s value. That was certainly so in the case of one unfortunate couple who said that tight restrictions applying to their home had rendered it all but unsaleable.
The case concerned a double-fronted Victorian home that had, during the 1980s, been converted vertically into two freehold properties. One of them, owned by the couple, was subject to covenants that, amongst other things, forbade them from keeping more than one domestic pet, from playing musical instruments or loud music after 11:00pm and from altering the structure or external appearance of the property without the consent of their immediate neighbours.
In applying under Section 84 of the Law of Property Act 1925 for the covenants to be discharged, the couple argued that they only became aware of them when they tried to sell their home and that their discovery had so far put off two potential buyers. The covenants reflected the personal sensitivities of the person who had carried out the conversion more than 30 years ago and the adjoining property was free of any such restrictions. Whilst insisting that they had no wish to be unreasonable, the couple’s neighbours resisted their application on the basis that discharging the covenants would remove valuable protections and potentially affect the value of their own home.
In ruling on the matter, the Upper Tribunal (UT) expressed sympathy for the dilemma in which the couple, through no fault of their own, found themselves. However, the covenants had not been rendered obsolete by changes in the character of the property or the surrounding area. The protections they afforded were not disproportionate and remained of value to their neighbours, whose objection to the couple’s application was neither frivolous nor vexatious.
Whilst refusing to discharge the covenants, the UT directed that they be modified so that the neighbours cannot unreasonably withhold consent to the couple keeping more than one pet, playing music at night or making alterations to their home.
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