Restrictive Covenant - Non responsive developer

singechamberlain

We have a restricive covenant on our property that essentially says "you can't build anything on the land without the permission of the developer, such permission not to be unreasonably withheld or delayed"

We were thinking of extending the property, and have written to the developer to seek permission. He's difficult to get hold of and so far hasn't replied.

What do I do if he never comes back to us? As I understand it if we go ahead and build the extention we have to wait a year before we can get insurance in case he decides to sue us. How can we protect ourselves for that 12 months, or does the "not to be unreasonably withheld or delayed" part protect us?
Any advice very welcome. Thanks!

eddddy

singechamberlain wrote: »

What do I do if he never comes back to us? As I understand it if we go ahead and build the extention we have to wait a year before we can get insurance in case he decides to sue us.

I don't think that you can get indemnity insurance after 12 months, because you have contacted the developer.

If you sold to somebody else after 12 months, they could get indemnity insurance - assuming that they did not contact the developer, and the developer had not complained about the extension in the meantime.

singechamberlain

eddddy wrote: »

I don't think that you can get indemnity insurance after 12 months, because you have contacted the developer.

If you sold to somebody else after 12 months, they could get indemnity insurance - assuming that they did not contact the developer, and the developer had not complained about the extension in the meantime.

So best not to try to contact the developer in case they don't respond?

NotSkint

I had such a restrictive covenant on my previous home in favour of the original builder. The house had an extension when we purchased it and I wouldn't accept an indemnity. Previous owner eventually got a letter approving the extension, so I purchased.
I then did a much larger extension and at the time didn't bother with the original builder as took the attitude that there was no basis upon which they could reasonably refuse.
When I came to sell, I sorted out the permission by going round to the builders house (because I knew where he lived) waved a letter in one hand giving me the permission, for him to sign, and a handful of money in the other to help with his thought process.
I don't think that such covenants are fair, as the builder maintains an interest long after the property has nothing to do with them, but I found a way round that worked for us.

singechamberlain

NotSkint wrote: »

When I came to sell, I sorted out the permission by going round to the builders house (because I knew where he lived) waved a letter in one hand giving me the permission, for him to sign, and a handful of money in the other to help with his thought process.
I don't think that such covenants are fair, as the builder maintains an interest long after the property has nothing to do with them, but I found a way round that worked for us.

Thanks for the feedback. Seems like these covenants are just used as cash cows by builders. I can't imagine any other reason for a builder having an interest in a property after they have sold it? I've read that some developers put these restrictive covenants in place when there are several properties being built in one development so that no changes are made until they are all sold.

NotSkint

singechamberlain wrote: »

Thanks for the feedback. Seems like these covenants are just used as cash cows by builders. I can't imagine any other reason for a builder having an interest in a property after they have sold it? I've read that some developers put these restrictive covenants in place when there are several properties being built in one development so that no changes are made until they are all sold.

Yes, I can understand them for that reason, but then they should really have a time limit imposed. The property I'm in now for example had such a clause relating to changes that was enforceable for the first 5 years from being built. When I purchased it my solictior just said they were time expired so treat them as if they didn't exist.
On the previous property there was no such time limit. The builder didn't own anything in the proximity and none of my neighbours had any beneficial rights to the covenant; I just needed the builder's permission which could not be unreasonably withheld or delayed.
Rightly or wrongly, I took the opinion that if I had planning permission then what valid objection could the builder give for withholding his permission that would stand up to legal challenge when he had no beneficial interest in the surrounding area and would he really want to incur a legal battle when the covenant actually states it cannot be unreasonably withheld.
Perhaps it would be worth you getting a legal opinion on what basis the developer could withhold permission; it will cost a small amount but could give you peace of mind.

lincroft1710

singechamberlain wrote: »

Seems like these covenants are just used as cash cows by builders. I can't imagine any other reason for a builder having an interest in a property after they have sold it?

Nothing wrong in builders profiting from a little bribery, sorry, sorry, I meant free market economy. If they can't be persuaded then the poverty stricken insurance companies will surely gain a few well deserved ££ by issuing the oh so useful and necessary indemnity policy.