Re Martin's Application (1989)

Re Martin’s Application (1989) 57 P & CR 119

LAND LAW – RESTRICTIVE COVENANTS – DISCHARGE – PLANNING PERMISSION – PRACTICAL BENEFIT

Facts

A local authority conveyed land to an individual containing a covenant requiring the purchaser to preserve the land as an open, undeveloped area. The purchaser acquired planning permission to develop the land in a manner which would breach the covenant.

Issues

S.84 of the Law of Property Act 1925 grants the Upper Tribunal the discretion to alter or completely discharge restrictive covenants in any of four circumstances. One such circumstance is where the continued existence of the covenant would impede some reasonable user and either is contrary to the public interest or does not secure to persons entitled to the benefit of it any practical benefits of substantial value or advantage to them.

The issue in this case was the impact of the defendant’s planning permission on the court’s discretion to discharge or modify the covenant on this ground.

Decision/Outcome

The Court of Appeal held that the planning permission and restrictive covenant regimes are two separate entities which might be relevant to each other, but not necessarily.

This had two implications. Firstly, the existence of planning permission does not immunise the defendant from liability for breach of any restrictive covenant to which his land is bound. Secondly, the existence of planning permission is a relevant, but not decisive, factor to consider when determining whether the covenant’s existence is contrary to the public interest.

The Court of Appeal also noted that the definition of ‘practical benefit of substantial value’ did not require the benefit to be an economically-valuable asset. Particularly where the beneficiary of the covenant is a local council (and therefore mainly concerned with public interest), non-economic advantages like avoiding high-density developments can count as a relevant, sufficient practical benefit.