In a recent judgment, the Supreme Court restricted the common practice by real estate developers of encumbering developments with various restrictions enabling developers to retain control over properties after their sale. In the specific dispute, a developer applied for entry into the land register of a free and time-limited personal right of use requiring each subsequent owner of the property to refrain from certain noise-generating activities. The developer also applied for entry of a restriction which would have banned each subsequent owner from contaminating the property and damaging the biotic community outside the plot.

Additionally, the developer applied for entry of a preventive servitude which would have specified the exact nature of buildings permitted on the plot. The Supreme Court found that the entry of these personal rights of use into the land register was not permissible. The Court explained that such an arrangement would essentially obligate the developer itself to refrain from certain acts. The law does not allow applicants to establish real right obligations for themselves, the Court noted. Such a transaction is contrary to the legal essence of a personal right of use and the entry applied for was therefore inadmissible. The Court explained that a thing cannot be encumbered with a personal right of use unless the beneficiary has a legitimate interest requiring protection. Itfound that a personal right of use to the benefit of the developer cannot be established simply because the developer wishes to prevent each subsequent owner’s construction noise during certain hours, contamination of the plot or damage to nature outside the plot. The Court noted that the benefits of refraining from such activities mostly relate to the interests of the owners of neighbouring properties.

The Supreme Court decision is, in essence, an opinion regarding the common practice by developers of attempting to control developed properties after selling them. The Court found that developers did not have legitimate interests which could be protected by such personal rights of use and these entries are thus not permitted in the land register.