[2024] UKUT 00001 (LC)

Section 84(1) of the Law of Property Act 1925 gives the Tribunal power to
discharge or modify any restriction on the use of freehold land on being satisfied of certain conditions. The applicants in this case relied on grounds (a), (aa), (b) and (c).

Ground (a) of section 84(1) is satisfied where it is shown that by reason of changes in the character of the property or neighbourhood or other circumstances of the case that the Tribunal may deem material, the restriction ought to be deemed obsolete.

Ground (aa) is fulfilled where it is shown that the continued existence
of the restriction would impede some reasonable use of the land for public or private
purposes or that it would do so unless modified. By section 84(1A), in a case where
condition (aa) is relied on, the Tribunal may discharge or modify the restriction if it is satisfied that, in impeding the suggested use, the restriction either secures “no practical benefits of substantial value or advantage” to the person with the benefit of the restriction, or that it is contrary to the public interest. The Tribunal must also be satisfied that money will provide adequate compensation for the loss or disadvantage (if any) which that person will suffer from the discharge or modification.

In determining whether the requirements of sub-section (1A) are satisfied, and whether a restriction ought to be discharged or modified, the Tribunal is required by sub-section (1B) to take into account the development plan and any declared or ascertainable pattern for the grant or refusal of planning permissions in the area, as well as “the period at which and context in which the restriction was created or imposed and any other material circumstances.”

Ground (b) is made out where it can be demonstrated that the persons of full age and capacity entitled to the benefit of the restriction have agreed, expressly or by implication, by their acts or omissions to the modification of the restriction.

The condition in ground (c) is met where it can be shown that the proposed discharge or modification will not injure the persons entitled to the benefit of the restriction.

The Tribunal may also direct the payment of compensation to any person entitled to the benefit of the restriction to make up for any loss or disadvantage suffered by that person as a result of the discharge or modification, or to make up for any effect which the restriction had, when it was imposed, in reducing the consideration then received for the land affected by it. If the applicant agrees, the Tribunal may also impose some additional restriction on the land at the same time as discharging the original restriction.

Should an applicant establish that the Tribunal has jurisdiction to modify the covenant, he has at that point only cleared the first hurdle; he then needs to persuade the Tribunal to exercise its discretion. This is a distinct and separate exercise although the Tribunal will not normally refuse an application if it is satisfied that jurisdiction has been made out. I now turn to the detail of the application.