[2023] UKUT 251 (LC)

Mr Francis focused on the question of substantial advantage which he said attached to the protection secured by the covenant against the ‘precedent effect’ or what has come to be known as ‘the thin edge of the wedge’. He did not have in mind the circumstances that relate to ‘building scheme’ cases where, in his words, the fear is that a modification will result in the floodgates being opened to other applications in a similar vein. Instead, he had in mind the removal of the fear of what the applicant would do next if the modification were permitted. In Mr Francis’s evocative phraseology this was the opening of a door rather than floodgates.

I think the fears of Mrs Cunningham and Mr Nix are misplaced. I have already alluded to the protection afforded by the planning system and the modification of the covenant to allow the use sought by Mr Kay would leave its primary purpose and effectiveness untrammelled. As the owner of Lea Hurst, Mr Kay is entitled to explore development proposals and is under no obligation to discuss them with his neighbours. The covenant does not prevent him from doing so, but it does provide a measure of comfort that every change will require an application for modification. Mr Peachey said that the ‘fat end of the wedge’ was the letting of seven rooms (the maximum under permitted development) and I am inclined to believe that his submission on this point is to be preferred.

Mr Adams-Cairns attempted to quantify the benefits secured by the restriction in value terms but conceded that the prospective purchaser when faced solely with the acquisition of Lamp Cottage with modification in place but ignoring the attempts at development, would not reduce his bid. Mr Francis disputed that this approach was appropriate; in his submission the proper measure was a comparison before and after modification assuming that the objectors are the willing buyers. Mr Adams-Cairns endeavoured to put a price on the uncertainty and the difficulty in ‘policing’ the covenant that he said that would ensue from modification and his analysis led him to a figure of £50,000. He said that he was guided by the costs that objecting to an application would entail and by the reductions in value that would accrue from various types of development on adjacent sites. Notwithstanding his long experience I would have been assisted by details of the examples he sought to rely on. Unfortunately, this evidence was missing from his report, and in any case related to actual developments rather the prospect of something being built, and I therefore have no means by which to judge whether his assessment was correct. Without this information his view amounts to little more than conjecture. In my view this is not a case where the practical benefits, such as they are, can be described as being substantial in value or advantage.

I do not accept that the covenant in its modified form would be difficult to ‘police’. Prospective guests will expect to be able to visit the website and see photographs and details of the rooms and facilities. It will be obvious how many rooms are being offered to guests and their availability. Mr Nix admitted as much at the hearing. It follows that I consider that ground (aa) is satisfied and I have jurisdiction to allow the application. As a corollary ground (c) is also made out.

Mr Kay did not pursue his application under ground (b).

Mrs Cunningham and Mr Nix did not seek compensation and I have heard no evidence in this regard. In the circumstances it is not necessary for me to devote any further consideration to the matter.