Covenant leway?

Jane_B

Good morning,

I have ran into a stumbling block with my part exchange and wanted to get some advice. Our buyer will be the developers themselves, who will be looking to obviously not move into our property but resell quite quickly.

Pretty late in the process their solicitors have flagged a covenant in our lease stating that the property cannot be transferred to anyone unless for their own occupation.

We are on good terms with our managing agents as my husband used to work for them, are they able to waive this? or is this something that no matter who we ask it cannot be changed. Our solicitors have asked them if they are ok with the part exchange going ahead (which makes me think there is wiggle room, otherwise why ask?)

But as I am getting really worried (since we are only a week from exchange) I wanted to see if it was possible for covenants to be allowed to be broken, or whether our solicitors and theirs are wasting their time.

TIA

davidmcn

Whoever has the benefit of the covenant can choose not to enforce it, agree to vary it, waive it completely, provide some sort of undertaking that they'll overlook a particular breach, etc. The purpose of the covenant is obviously to prevent properties being let out, I can't see why anybody would care about it being briefly in the ownership of the developer while they flog it. Though the developers might be concerned about the effect on value of the covenant being there at all.

Anyway, if your solicitors have already asked the question, all you can do is wait to see what the answer is. Exchange only happens when everybody is happy, it doesn't need to be in a week's time.

Jane_B

davidmcn wrote: »

Whoever has the benefit of the covenant can choose not to enforce it, agree to vary it, waive it completely, provide some sort of undertaking that they'll overlook a particular breach, etc. The purpose of the covenant is obviously to prevent properties being let out, I can't see why anybody would care about it being briefly in the ownership of the developer while they flog it. Though the developers might be concerned about the effect on value of the covenant being there at all.

Anyway, if your solicitors have already asked the question, all you can do is wait to see what the answer is. Exchange only happens when everybody is happy, it doesn't need to be in a week's time.

If they did agree to vary it (fingers crossed!) would this be a lengthy process, as in issuing new leases to everyone in the block ? - just trying to guesstimate the lead time this would give us, as we want to be in before Christmas