[2024] UKUT 62 (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 (aa) and (c); unless one of these grounds is made out the Tribunal has no jurisdiction to modify or discharge the covenant.

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, and 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.”

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 applicants focused in argument on ground (aa), accepting that if ground (aa) is not made out then neither can be ground (c).

If the applicants are able to establish that the Tribunal has jurisdiction to modify the covenant they will have only cleared the first hurdle; the Tribunal then has to make a discretionary decision whether or not to do so.

If it does so, the Tribunal may also direct the payment of compensation to any person entitled to the benefit of the restriction. If the applicant agrees, the Tribunal may also impose an additional restriction on the land at the same time as modifying the original restriction.