Has the London housing shortage begun to impact on the enforceability of restrictive covenants? The Court of Appeal has recently affirmed that a chronically underused provision, section 610 Housing Act 1985, can be used to discharge or modify restrictive covenants. (This is in addition to the weaponry for varying covenants under the Law of Property Act 1925.)
Converting houses into flats
Section 610 is specifically concerned with authorising the conversion of a house into flats. One of two limbs must be satisfied: either, owing to changes of neighbourhood character, the premises can no longer easily be let as a single dwelling, but would become lettable as flats, or, planning permission has been granted. With respect to the planning angle, however, the Court of Appeal was keen to emphasise that it had to carry out its own examination of the circumstances and reach its own independent conclusion; the fact that planning permission has been granted is not sufficient to ensure that the covenant will be discharged or that the court has any duty to discharge it.
In Lawntown v Camenzuli (2007) a pair of houses was subject to a restrictive covenant to be used as a single dwelling only. Planning permission was only granted after the physical conversion works had started. The court had to have regard to the interests that ought to be protected by the restrictive covenant – in this case adjacent property was owned by Mr and Mrs Camenzuli – and the extent to which those interests would be harmed by the proposed variation, if the works were permitted to continue, as well as to the interests of the developer seeking to vary the covenant. Ultimately the court embraced the urgent need for more housing in smaller units in London to meet demand and supported the developer by agreeing that the restrictive covenant should be discharged.
Key points: The social need for housing units in London can outweigh the benefits to neighbours of ensuring that a house remaines in single occupation.
A court will make its decision independently of the local planning authority.