WHAT IS A RESTRICTIVE COVENANT AND WHY DO THEY EXIST?
By Gail Barry
Chartered Legal Executive & Associate
A restrictive covenant is an obligation which imposes a restriction on the use of land. Put simply, it is a covenant not to do something. They can be used to protect the value and enjoyment of neighbouring properties and can cover a wide range of issues such as:
- Preventing owners from making alterations to a property (such as building an extension)
- Preventing buildings or other substantial structures from being erected on land
- Preventing trades or businesses from operating on the land
Generally restrictive covenants must be concerned with the use of the land. Unlike many agreements you may make as a landowner, they create an interest in land which survives even if the land is sold, making them enforceable against subsequent owners. Because they are applicable to all future purchasers of the property and not just the original purchaser it is important to check for any restrictions on a property before you buy it and ensure that no covenant has already been breached by the current (or previous) owners.
It is also important to check who has the benefit of the restrictive covenant as they will be responsible for enforcing any breaches or answering any queries or applications.
A breach of covenant could have significant implications. The person with the benefit of the covenant may be able to insist on the breach being rectified meaning you could be forced to pull down an extension, pay a substantial fee or even face legal action. It is generally accepted in cases where an owner has breached a covenant for over 12 months without challenge and subsequently sells the property, the buyers should be able to get restrictive covenant insurance to protect against that breach. These policies usually last forever and can normally be passed on to future owners of the property.