Restrictive covenants can have a significant impact on the conditions of land ownership and property rights, particularly in the realm of agricultural land. For landowners and prospective buyers, understanding the implications of these covenants is paramount to avoiding legal entanglements and maximising the potential of their properties.
What is a Restrictive Covenant?
A restrictive covenant is a legal agreement that imposes limitations or obligations on land use. Typically, these covenants are established to maintain certain standards, preserve an area’s character, or protect specific parties’ interests. Restrictive covenants are commonly established when someone selling a piece of land wishes to limit what the purchaser can do with it. In the context of agricultural land, restrictive covenants may restrict activities such as building development, commercial use, or alterations to the landscape. For example, an agricultural restrictive covenant may provide that the land “is to be used for agricultural purposes only”.
Whilst restrictive covenants limit the ability of a property owner to make adaptations there also exists positive covenants. These impose an obligation for the property owner to carry out a specific activity such as undertaking specific repairs and paying money.
Can You Get a Covenant Removed?
Removing a restrictive covenant is not straightforward and often requires legal intervention. One avenue is to seek a discharge or modification of the covenant through negotiation with the parties involved. Subject to the parties agreeing an acceptable premium for the removal of the covenant, then this will often be the most attractive commercial resolution. Alternatively, if it is not possible to negotiate the release of the covenant, then an application can be made to the Upper Tribunal (Lands Chamber) for the modification or discharge of the covenant if certain conditions are met, such as changes in circumstances rendering the covenant obsolete or where the covenant impedes the reasonable use of the land.
How Are They Enforced?
Enforcement of restrictive covenants falls to the parties benefiting from the covenant, who have the right to take legal action against any breaches. This could involve seeking an injunction to stop the breach or pursuing damages for any harm caused. However, enforcement action must be weighed against the potential costs and complexities involved.
What Structures Can Be Put on Agricultural Land That Have a Restrictive Covenant?
The specific restrictions imposed by a covenant will determine what structures can be erected on agricultural land. Common restrictions may include limitations on building height, footprint, or purpose. For instance, a covenant might prohibit the construction of non-agricultural buildings or require adherence to certain architectural styles to preserve the rural character of the area.
What to Do if a Previous Owner of the Land Has Breached a Covenant
If a previous owner has breached a covenant affecting the land, the current owner may still be liable for any continuing breaches. In such cases, it is crucial to assess the extent of the breach, its impact on the land, and any potential remedies available. In the case of a breach of covenant, it is recommended to seek legal advice.
Can I obtain insurance against the risk?
It is often possible for an owner to purchase insurance against the risk of a beneficiary enforcing a restrictive covenant. However, an insurer is very unlikely to provide insurance where there is already a dispute. If you have indemnity insurance then beware invalidating the same by subsequently contacting any beneficiary of a restrictive covenant as this could invalidate the policy.
What to Do If a Dispute Arises Over a Restrictive Covenant
Disputes over restrictive covenants can escalate quickly and may require resolution through legal channels. Mediation or arbitration may offer more expedient and cost-effective means of resolving disputes compared to litigation. Seeking guidance from a solicitor experienced in property law is essential to protect one’s interests. Due to the time-sensitive nature of a dispute, consulting a solicitor at an early stage can often help mitigate the risk of litigation.
Consulting a Solicitor About Agricultural Restrictive Covenant Concerns
Given the legal nuances and potential implications involved, consulting a solicitor with expertise in commercial property law is highly recommended for anyone dealing with restrictive covenant concerns. A solicitor can provide invaluable guidance on interpreting covenant terms, assessing the enforceability of restrictions, and navigating the complexities of dispute resolution or covenant modification processes.
Understanding the implications of these covenants, seeking legal advice when necessary, and approaching negotiations with diligence are essential steps for agricultural landowners and buyers to protect their interests and ensure compliance with legal obligations.
Speak with a Specialist Solicitor
DTM Legal has a team of solicitors who specialise in the Agricultural legal services. To further discuss any issues relating to restrictive covenants on land please contact Anna Duffy at anna.duffy@dtmlegal.com or James Holton at james.holton@dtmlegal.com.
