[2024] UKUT 187 (LC)

The application has two elements. First, Clarion applies for the modification of clause 2(a) to remove the reference to an ‘old persons’ warden scheme’, and to widen the restriction to provide that the application land will not be used other than for ‘residential and ancillary purposes’.

Secondly, Clarion applies for the discharge of clause 2(b), to remove the requirement to obtain the Vendors’ written consent for the erection or alteration of buildings.

Clarion argues that both restrictions are obsolete. It relies on ground (a) of s.84(1) of the Law of Property Act 1925 (“the Act”) which is satisfied where changes in the character of the property, or the neighbourhood, or other circumstances which the Tribunal deems material, have caused the restriction to become obsolete.

In addition, as regards the modification of clause 2(a), Clarion relies on ground (aa) which is satisfied where the restriction impedes some reasonable use of the land for public or private purposes. For such an application to succeed the Tribunal must also be satisfied that, in impeding that reasonable use, either the restriction secures no practical benefits of substantial value or advantage to those with the benefit of the restriction, or it is contrary to the public interest. The Tribunal must also be satisfied that money will provide adequate compensation for any loss or disadvantage which that beneficiary of the restriction will suffer from the proposed discharge or modification.

In determining whether a restriction ought to be discharged or modified under ground (aa), the Tribunal is required to take into account the statutory development plan and any declared or ascertainable pattern for the grant or refusal of planning permissions in the area. It must also have regard to the period at which and context in which the restriction was imposed and any other material circumstances.

Section 84(1) provides that the Tribunal, upon being satisfied that either of the grounds is made out, ‘shall… have power’ to, by order, wholly or partially to discharge or modify the restriction. As the Supreme Court explained in Alexander Devine Children's Cancer Trust v Housing Solutions Ltd [2020] UKSC 45 this involves a two-stage process. First, in what the Supreme Court called the ‘jurisdictional stage’, the Tribunal must be satisfied that one of the prescribed grounds is made out. If so, in the ‘discretionary stage’, the Tribunal must then decide whether and to what extent to exercise its power to discharge or modify.

The Tribunal may direct the payment of compensation to make up for any loss or disadvantage suffered by the person entitled to the benefit of the restriction, 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.