What to do about Restrictive Covenant

Scaredy_Cat_3

Hi Silvercar

Yes, that's the kind of info I've been given also - but I'm not sure how it all works in practice. Most people seem to be of the opinion that it's just a way for Redrow to make some money - the estate was built (not even by Redrow) 40 years ago - as far as we know Redrow don't own any of the land on the estate, and are unlikely to object to any extension plans. However, I am by nature a very cautious person, and I'm scared that they just MIGHT object. No reason to think they will, after all, many houses on this estate have had extensions built. In due course we will try to speak to some of the neighbours and find out how they handled it (but as we have only just moved in we don't feel comfortable doing that just yet).

The people who lived here before must have just gone ahead and done their mini extension without Redrow's permission, and I'm guessing it wasn't even an issue until they came to sell the property and their solicitor noticed the restrictive covenant. That's when they applied for retrospective permission (and got it).

Other people we have spoken to around here seem totally unconcerned about having these covenants on their land, but it's new to us - we've never come across one before and frankly we just don't like the idea that a third party has this control over our plans (could understand it if they were still building in the area, but the estate was completed in the 70s and it wasn't even Redrow who built it).

Ideally we would like to buy out the covenant. But if we approach them about this, and can't come to an agreement, where does that leave us for future plans for an extension?

plane_boy2000

Personaly I would just approach Redrow. As they only have an interest becuause thy bought the original builder then I doubt that they will have any / little interest and will likely just grant you the permission you want for a small fee. As you say they have already done it once. Why not just give them a call and ask them the situation - it slikely to be something that they come across quite often, and it sounds as though the house is not very new in that they are still building in the area so they will have little vested interest.

I may have missunderstood but the comment about indemnities - was that not to cover you while you were buying the house rather than post purchase?

JoeK_3

plane_boy2000 wrote: »

Personaly I would just approach Redrow. As they only have an interest becuause thy bought the original builder then I doubt that they will have any / little interest and will likely just grant you the permission you want for a small fee. As you say they have already done it once. Why not just give them a call and ask them the situation - it slikely to be something that they come across quite often, and it sounds as though the house is not very new in that they are still building in the area so they will have little vested interest.

I may have missunderstood but the comment about indemnities - was that not to cover you while you were buying the house rather than post purchase?

Why not write a standard letter to all the heighbours and ask them if they have tried to buy out the covenant? This way you will find out if they have tested the water with Redrow.

JoeK

Scaredy_Cat_3

Hi JoeK & Plane Boy

Thanks for the info. The bit about indemnity policies was really just brought up because it was one of the ways suggested to us (on this board) to resolve the issue of the restrictive covenant.

We bought the property with the intention of one day building an extension as it is a corner plot. It was very late in the proceedings that we were told about the covenant - and it was a Saturday morning when we got the letter so came on here for advice as the solicitor was not available. We were worried that when we come to sell we will have the same problem as the previous owner (ie having to apply for retrospective permission) if we haven't got the matter resolved before then. It seems that this will only become an issue when we come to sell as that is when a solicitor will look at the deeds and start asking if we have the relevant permissions or an indemnity policy to cover any future purchaser.

I strongly suspect that the neighbours who have extended will not have bothered with permission since it doesn't appear to be a problem until a solicitor looks at the deeds. Certainly when we have settled in a bit we will talk to the neighbours and ask what they have done - but it looks like the previous owners didn't bother to get permission until they were about to sell up, so I would guess that most of the others haven't either.

We did speak to Redrow before the move - without giving any details of the address. The receptionist/first point of contact seemed to think it was unlikely there would be a problem, in fact I think she said she had never known permission to be refused (she spoke to my husband so I'm not sure exactly). Then later my husband spoke to one of their solicitors to get a more detailed view and she was very condescending and suggested he didn't know what he was talking about and she would rather speak directly to our solicitor (pointless as the solicitor had no idea what our plans were, and even she admitted my husband knew more about the building regs etc than she did).

So this experience made us wary of giving them the address details, and now we are just concerned that if we do try to buy out the covenant and fail, we will have problems with getting permission too. Someone said you can't get an indemnity policy if you have already approached the builder and told them about the extension plans. So if we approach them about buying out the covenant, does that preclude us from later taking out an indemnity policy, or are the two issues considered totally separate? Also, if we approach them about buying out the covenant that would be done in the near future, but it will probably be years before we get around to actually doing the extension.

plane_boy2000

I am still confused about the indemnity. What exactly are you indemnifying yourself against?

To build and assume that you will only need to demonstrate compliance afterwards is a very high risk strategy. If you build and redrow found out, or a neighbour complained then you would be in breach of your covenant. Now I am not sure what the worst case penalty would be, but at a guess they could make you return any covered areas to pre breach condition. Not a chance I would take. I think the only option you have is do decide what you plan to do and then seek approval.

plane_boy2000

Sorry, just had another thought. How could you buy yourself out of a convenant. Its purpose is to provide protection to the owner and neighbours, so for example the covenant on my house precludes me from sticking up a satelite dish on the fron of my house so as to preserve the appearance of the road. I am also not allowed to store a caravan or park a comercial vehicle on my drive etc. These are all there to protect the enviroment of my neighbours so I fail to see how you could "buy" you way out as that would defeat the purpose.

Scaredy_Cat_3

My understanding is that an indemnity policy is there to provide protection against the builder ever trying to enforce the covenant. I've been told it is something you buy once and it just sits with the title deeds to be passed on to future owners. It seems that people round here are quite happily building extensions (obviously with local authority approval) but the issue of the covenant only comes to light when they want to sell. At that point you either get retrospective permission or an indemnity policy, it seems to me this is required to satisfy the solicitors rather than the neighbours, who get their chance to object when you apply for planning permission from the local authority. Obviously I would agree it's better to get permission before you do the work - I'm just trying to work out what the options are if we choose a different route - as I said I am worried they would refuse simply because Redrow's solicitor was so condescending and unhelpful.

The idea of buying out the covenant came from the previous owner of the property. We were told that he had spoken direct to Redrow at some point shortly before selling to us (a matter of days), and from that it was suggested that there may be the possibility of buying out the covenant. We never got any hint of the sum of money that would be involved, and because of the advice we had been given here (about not being able to get an indemnity policy if you have already spoken to the builder) we wanted to keep our options open so we never asked Redrow about this option. Also, this issue of the covenant only came to our attention about a week before completion and the whole thing was a nightmare. We took the advice given here (our solicitor wasn't much help on the subject) and thought we would be able to resolve the issue using one of the options I listed in my first post.

Unfortunately we were under pressure to proceed (our buyers were keen to move in and we had already had to delay the move by about 3 weeks due to problems on the survey). Thsi issue of the covenant was a major concern to us but no-one else seemed particularly bothered - I can't even remember if the info about the previous owner having spoken to Redrow came to us from the solicitor or the estate agent, because there was so much to-ing and fro-ing.

I think you may be right that the best way forward is to approach Redrow about buying out the covenant and if we can't do that then we'll just have to show them the plans and hope they approve.

Thanks for the advice!