[2024] UKUT 62 (LC)

The breach in the building scheme and the risk of further development in the future.

As things stand St David’s Square is unaltered, so far as is known, since its construction. As the objectors put it, the building scheme has worked well. They are concerned that if the present application is successful future applications will have more chance of success.

This is not an argument based on fear of future applications; such an argument is, as Mr Jourdan KC helpfully set out, not a legitimate answer to the application. All the property owners in the development have the benefit of section 84 of the Law of Property Act 1925 and if they can meet the conditions set out therein they can have a covenant modified or discharged; it is not open to the objectors to argue that because this is a building scheme they should not have the opportunity of doing so. The prevention of the expense and stress of responding to future applications is not a practical benefit secured by a covenant of this nature, as the Tribunal has made clear (for example in Martin v Lipton [2020] UKUT 8 (LC) at [83]).

Instead, this is the argument known as the “ratchet” or “thin end of the wedge” principle. The Tribunal explained it in Morris v Brookmans Park Roads Ltd [2021] UKUT 125 (LC), where the application was for the modification of a one house per plot covenant to permit conversion of a house into flats:

“101.

Whether developers are more likely, if this application succeeds, to develop first and seek modification later is a matter for speculation. There are obvious risks involved in doing so and we think it is impossible to predict whether that will happen. The important issue is not so much the behaviour of developers but the likely response to future applications by this Tribunal [and] whether the granting of the present application will have the effect that more applications will be granted in future.

102.

We take the view that it will. True, the Tribunal is not bound by its previous decisions and it looks at each case on its own merits. But the merits of each case depend upon the context for the application. Each modification of the covenants to allow a flatted development to proceed has an effect, however small, upon the estate as a whole and the levels of population, traffic, congestion and noise overall. Each modification changes those levels and therefore changes the context in which the next application is considered and ensures that the effect of the next flatted development is, likewise, only marginal.

103.

We can see this in Brookmans Park. There are flats there already at 9A. The flats at number 11 therefore do not stand in isolation and, by themselves, they make little difference to the road, let alone to the estate. But if the covenants on number 11 are modified so that the flats can remain, then the next application for modification … will be made in the context of a road that already has two flatted developments. The construction of, say, four flats in place of one of the houses will not double the number of flats on the road; it will increase their number only by 50%. And so on. Each time it looks a little easier and a little more marginal. But at some point the cumulation of the marginal effects of each development will make a substantial change in the road and in the estate.”

In St David’s Square the starting point for future development would be different. The Brookman’s Park application was for modification to a single dwelling, which would not in itself be a big change; here, as we have already said, the modification of the covenant for all eleven application properties will enable a substantial change to the estate and a significant departure from its architectural unity. The risk in the present case is that after that big change, more would follow.

The application properties are not the only ones that might be able to be extended. The houses in Westferry Road have courtyards; true, the internal layout of those houses is different and less easy to extend, but an applicant for modification of the alterations covenant so as to enable a rear courtyard extension would be in a strong position if the alteration covenant had already been modified so as to permit a kitchen extension.

There have been other planning applications. In 2020 Mr Patel applied, unsuccessfully, for planning permission for a two storey extension at 24 Ferry Street. In 2008, the local planning authority refused a certificate of lawfulness for 440 St. David’s Square (one of the houses on Westferry Road), where the owner was seeking to add a two-storey extension above the garage. There are two pairs of double garages between houses on Westferry Road with space for that sort of development, and Mr Spender drew our attention to the vacant land to the west of the last house in the Westferry Road terrace.

So the possibility of future applications is not fanciful. In any future case the applicant will be able to say that the building scheme has already been breached and to argue that a small further change will make no difference. And indeed a change to just one more structure, following the large-scale changes to the Ferry Street terrace, may not make a lot of difference, but there would then be a cumulative effect which would further erode the visual and architectural unity of the estate, as well as making it more crowded with buildings and structures.

We regard the avoidance of the thin-end-of-the-wedge effect, preventing even further erosion of the design and character of the estate, as a practical benefit of substantial advantage (and perhaps of some value, albeit difficult to quantify). That being the case we have no jurisdiction to modify the covenant.