What Is a Restrictive Covenant?
A restrictive covenant is a legally binding obligation attached to a piece of land that restricts how the owner can use it. Unlike a contractual obligation between two parties, a restrictive covenant "runs with the land" — meaning it binds not just the original party who made the promise, but also all future owners of the affected land, for as long as the covenant remains in force.
Restrictive covenants were commonly inserted into conveyances in the 19th and early 20th centuries — particularly on large estates where landowners sold off plots but wanted to control how the development proceeded. They are also frequently used in more recent residential developments to maintain the character of the estate.
Common Examples of Restrictive Covenants
Restrictive covenants on residential property commonly restrict:
- The use of the property to residential purposes only (prohibiting commercial use)
- Building additional structures (extensions, outbuildings, garages)
- Converting a house into flats or multiple dwellings
- Parking commercial vehicles or caravans on the property
- Keeping certain animals
- Operating a business from the property
- Erecting fences or boundary features above a certain height
- Making alterations to the exterior appearance of the property
Are Restrictive Covenants Always Enforceable?
Not necessarily. For a restrictive covenant to be enforceable, the following conditions must generally be met:
- The covenant must be negative in character — it must restrict what can be done, rather than impose a positive obligation (positive covenants generally do not bind successors in title)
- The covenant must have been intended to benefit neighbouring land, not just the original covenantee personally
- The person seeking to enforce the covenant must own land that actually benefits from it
- The benefit of the covenant must have properly passed to the current owner of the benefiting land
Many old covenants fail one or more of these tests — making them potentially unenforceable. However, you should never simply ignore a covenant without legal advice, as the consequences of breach can be severe.
What Happens If You Breach a Restrictive Covenant?
If you breach a restrictive covenant — for example, by building an extension that the covenant prohibits — the person with the benefit of the covenant may seek:
- An injunction requiring you to stop the breach or demolish any unauthorised works
- Damages to compensate them for any loss of value to their land
- A court order requiring you to reinstate the property to its previous condition
Breaches of restrictive covenants can also create title defects that may affect your ability to sell or remortgage in the future.
Discharging or Modifying a Restrictive Covenant
If a restrictive covenant is causing you problems — for example, by preventing a development that you want to carry out — there are several options:
Negotiate with the Benefiting Owner
If you can identify and contact the person with the benefit of the covenant, you can try to negotiate an agreement to release or modify it. This can sometimes be achieved relatively quickly and cost-effectively.
Application to the Upper Tribunal (Lands Chamber)
Section 84 of the Law of Property Act 1925 gives the Upper Tribunal power to discharge or modify restrictive covenants on application. The Tribunal can act on several grounds, including where:
- The covenant has become obsolete due to changes in the character of the neighbourhood
- The covenant impedes a reasonable use of the land and gives no practical benefit to the benefiting owner
- The benefiting owner agrees to the discharge or modification
This process can be complex and lengthy (typically 12–24 months) and requires expert legal and expert evidence. However, it can be the most reliable route where informal negotiation is not possible.
Covenant Indemnity Insurance
Where a covenant is of uncertain enforceability, or where it was breached some years ago without adverse action being taken, indemnity insurance may be available. This is a one-off premium insurance policy that protects the current and future owners against a claim arising from the covenant breach. Lenders also generally accept indemnity insurance in place of resolving the covenant issue itself.
Restrictive Covenants and Conveyancing
When you purchase a property, your conveyancing solicitor will identify all restrictive covenants affecting the title and report to you on:
- The precise wording of each covenant
- Whether it appears to be enforceable
- Any existing breaches
- The practical implications for your intended use of the property
- Options for addressing problematic covenants — including insurance, discharge, or modification
