Restrictive covenants New build and mis selling of property

Gtd

I recently purchased a new build property. The sales executive at the time of choosing our plot highlighted several plots that we might be interested in. He particularly focused on one plot that had a large swathe of land next to it that was deeded to the property. The land was cut off by a fence which made the only access for ourselves to it was to walk around the block of houses to reach it. This land sat adjacent to another property, delegated by a public walk way and driveway. We asked the sales executive at the time why the fence was in effect blocking us from utilising the land. Fence was about 20 meters long. He said he wasn’t sure but that it was our land. I asked what we could do with the land I.e could be remove the original fence and fence around the land within our boundaries thus doubling the size of our garden. Of course he said yes with words to the effect you can do what you like, it’s your land. He made a big song and dance about it and what a great plot it was, the land made it really big blah blah blah. Obviously this was a major selling point to the land. I asked him if he could confirm the fact we could fence the land. He came back to us and said we could, a couple days later we put down the deposit. 

After exchanging contracts the stance of the sales executive changed. We now couldn’t fence the land. This obviously created rather a lot of tension. I pressed further as to why not and told him that he had mis represented the property at point of sale. Obviously he denied this. I asked to speak to his superior. At this stage he went away and came back to us several days later to say the developer was re assessing the fence. A week or so later he asked me to come to the office to agree a new site plan with the new fence shown and agreed. He asked me to sign this site plan to agree I was happy with this. Obviously I was. I signed the document. I have a copy of this signed document as I asked him for one and he gave it to me. 

A few days later he rang again to say that the developer wasn’t going to change the fence line and it would be built as the original plan. I said fine, then once I move in can I re place the fence around my land as the new plan had shown. The answer was no. When asked why he couldn’t explain. I asked to be put in touch with his superior and again raised the point of the property being mis sold. 

Eventually I was put in touch with the sales manager. She was very nice and quite sympathetic to the issue. She explained the sales executive was fairly new and inexperienced. I mentioned I had a copy of the proposed new site plan that I had been made to sign. She was quite clear that I should not of been given this document. I explained I felt the property had been mis sold and that in reality I was asking just if it could be done rather then the developer paying for it. 

Anyway she came back to me a few days later. Basically said if I was to move the fence, they weren’t going to get upset about it, and that the worst that would happen would be I would receive a letter from the developer, but no further action would be taken. She explained the letter would be the sum of it, they wouldn’t be sending someone to take the fence down and certainly wouldn’t be going to the trouble of court action.  She basically asked if I was prepared to wait until they had left site. I said I probably wasn’t as I had no way of adequately maintained the land and a neighbour had already decided to park his car across it constantly. 

I asked for her comments in writing. She obviously refused.

This was all before we moved into the property. 

We moved in March 2020.
We struck up a good relationship with the site manager, who was aware of the intention to move the fence. We discussed it several times. He understood why we would want to do it and couldn’t understand why the fence had annexed the land in the first place. He even made sure the land was turfed instead of wood chipped as had been the plan. I struck up a decent relationship with the fella at the back of the property who was parking his car on it whilst it was a scrap piece of land. He was very interested in my intentions with the land. I told him also that I was intending to fence it. A couple who would look out to the side of my property moved in on the day I had the fences moved. This did cause quite a stir. They were undoubtably upset. I explained the situation and that the developers had known of my intentions. She had also been told by the fella with the car. I just don’t think she expected it to be moved so soon. We have spoke several time’s since and she has been round to our house. She is nice and is not to bothered by the fence but moreover that she wasn’t told by the developers. Apparently upon originally hearing about the fence she asked the original sales executive and he denied any knowledge. 

Fast forward to know, I have received a letter from the developer explaining I have 5 days to return the fence to its original position due to my breaching a restrictive covenant. 

The sales manager, so the sales guys boss, who took the complaint up and explained what would and wouldn’t happen and basically gave me the green light to move the fence has since been made redundant. I spoke to her yesterday and she still seemed to think nothing would happen after the letter as they wouldn’t want to go to court action. I spoke to my solicitor who dealt with the sale. This is another problem, they were recommended to me at point of sale with a discount if I used them. So I’m wondering if they have a conflict of interest? They have informed me with 24 hrs that in there opinion with my best interest at heart I should return the fence to its original position. That was via email. They haven’t returned my calls. Also, when I made the original complaint, in writing, about the mis selling of the property hasn’t been addressed properly I don’t think. For me, that situation now becomes live again. The site manager that was here from when we moved in has moved on as he was actually the contracts manager and was just babysitting the site through lockdown. I am yet to speak to him. The new site manager who took over a few months ago and was aware and watch the fence be moved, was non to fussed with it. He just said there was nothing much to be done and it was up to the neighbours to lodge complaints. The couple that moved in I don’t believe are that bothered about the fence. I think they tried to use it as leverage to get something out of the developer. 

Anyway at this stage I am not planning on moving the fence back to it’s original position. 

But please, I invite anyone’s thoughts and ideas with this one. 

ProDave

I am not surprised.  It matters not what is said verbally, all that matters is what is says in the deeds.  you should not have signed the contract until they had been changed to your satisfaction.

The best you can hope for now is put the fence back.  Wait until the development is complete and the builders have moved on and try again.  Or enclose the land by planting a hedge and when the hedge is mature take the fence down.

AdrianC

So what does this covenant actually say?

Didn't you see the covenants before exchanging, and ask your solicitor to explain them?

How is the land shown on the Land Registry map? Did you go over that with the solicitor before exchanging?

Gtd

ProDave said:

I am not surprised.  It matters not what is said verbally, all that matters is what is says in the deeds.  you should not have signed the contract until they had been changed to your satisfaction.

The best you can hope for now is put the fence back.  Wait until the development is complete and the builders have moved on and try again.  Or enclose the land by planting a hedge and when the hedge is mature take the fence down.

Would either of you think the property was mis represented at sale? And regarding the new layout plan I was made to sign of the sales fella? Which I have a copy? Thoughts?

AdrianC

Gtd said:

Would either of you think the property was mis represented at sale?

No.

Your solicitor's job is to ensure that you're buying what you think you're buying. You might have a case against them, if you weren't made aware of the reality of the situation.

And regarding the new layout plan I was made to sign of the sales fella? Which I have a copy? Thoughts?

Post-exchange?

Utterly meaningless. You were already contractually obliged to buy what you had exchanged contracts on.

Gtd

AdrianC said:

So what does this covenant actually say?

Didn't you see the covenants before exchanging, and ask your solicitor to explain them?

How is the land shown on the Land Registry map? Did you go over that with the solicitor before exchanging?

Quote - not to alter or heighten any wall or fence whether or not it is on the boundary of the property or to paint any wall. 

Solicitor at the time of exchange said they were checking. When I explained to conversation with the sales manager and what she said solicitor kind of just left it there as permission had kind of had the nod. I understand nothing In Writing is a problem. But I have the document of the new site plan that I was asked to sign. I have a copy of that document. 

Land registry plans shows my deeded land encompassed with the land at the side. Also shows the fence in original position. I will attempt to post a picture. 

Gtd

Also, will add to this I have obviously been doing a bit of reading ( I know, should of read beforehand) and have read that it is difficult for developers to enforce covenants when multiple have been previously broken throughout the development which can be evidenced. Also, “ The court may take into account what the parties would have negotiated for the release of the covenant and whether or not the claimant may have tacitly acquiesced to the breach by failing to prevent breach while having knowledge of it.“ 

I can prove they knew of this change. 

AdrianC

Gtd said:

AdrianC said:

So what does this covenant actually say?

Quote - not to alter or heighten any wall or fence whether or not it is on the boundary of the property or to paint any wall. 

So a fairly standard new-build estate covenant, the kind of thing that's in place to keep the estate consistent while they're selling the rest off.

Remember - the only people who can enforce a covenant are the beneficiaries. The developer, in this case, I presume?

Once everything's sold and they've moved on, they won't care about enforcement.

princeofpounds

This is a textbook case of some of the pitfalls of buying new builds.

Firstly, there is no such thing as 'mis-selling' property. 'Mis-selling' is a concept where the vendor of a product owes a duty of care to their customer. It became a particularly popular approach for regulators in the financial sector over the past couple of decades, on the assumption that the average person is too stupid to understand what they are buying.

You can argue about whether that is right or not, but the key point is that no such regulatory concept exists in the sale of real estate. In fact, real estate is even exempted from many of the more standard consumer protection regulations. You have more protection buying a mobile phone that you do buying a house. You may have heard the phrase 'Caveat Emptor' - it means buyer beware, and it's often used in conjunction with buying property. You are basically expected to do all your own due diligence - or employ professionals to do it for you - and what you contract to is what you contract to (with some rare exceptions, perhaps).

The sales people can pretty much say whatever they like, especially if it's not written down on paper so you have no evidence trail. The only thing that matters in the end is what was included in the contractual documents you exchanged on. The title plan, the title deed, the sellers' property information form etc. If what the sales people told you is different to what was in the documents, you should have raised that specifically with your solicitor in writing.

Using the recommended solicitor is also foolish. There is a conflict of interest, although only indirect so it's not illegal for developers to push business in that direction. The solicitors do owe you certain duties, but in the back of their minds will be the longer-term business relationship with the developer, so they tend to do the minimum required to stay on the right side of the line. A legal 'work-to-rule', if you like, rather than a passionate defence of your interests.

If they had neglected to inform you of something major, or mis-advised you, you may have a claim against the solicitor. But the problem you have is that they very likely have a good defence for all of this. They would have shown you the title plan. They would have shown you the covenants. They would have asked you if you had any questions and if you were happy with what you saw. But you relied on the verbal assurance of a salesperson over making hard legal enquiries. 

Do you have any idea why they are so keen to keep this space open? Are they trying to given other residents the impression that it is some kind of communal amenity? Or does it just look nicer that way?

Anyway - yes, it is quite likely that once they have finished marketing they will no longer care about any of the covenants. After 25 years with no action, they would lose the ability to enforce them. But clearly they do for now. If you want an easy life free from legal proceedings, then you should comply for now. If you want to fight it, it may be a disproportionately long and expensive process, and you may not succeed or only partially. But here are a few things to think about:

- If you can evidence that you were given an informal go-ahead by the developer, you could potentially try to discharge the covenant at a Upper Tribunal, on the grounds of express or implied permission. In theory, your solicitor should have made notes about their enquiry on this point, but they probably didn't. Perhaps the redundant sales manager will provide you with a statement?

- There may be other legal arguments you could deploy. You could argue that the lack of a fence is of no benefit to the beneficiary. You could argue that it impedes reasonable use of the land. But bear in mind these arguments will not be assessed against your own opinion - they are technical legal arguments that will be assessed against statue and case law, and you will need legal advice on this too.

- You may be able to work around the covenant itself - 'not to alter or heighten any fence' is quite specific language. On a layman's reading it may not technically apply to new fencing, but you'd need legal advice on that point of detail to be confident. Or you can potentially try different methods of asserting your right of ownership, assuming it doesn't break other covenants. You can plant a thick and thorny hedge for example, that's almost as good as a fence. Or you can possibly park cars on the land. Or dig a ditch. Use your imagination, you know the land better than we do.

- You may choose not to remove the fence until you get formal notice of legal action. It's possible that they will not bother going that far, and are only serving the notice to preserve their rights to the covenant or to keep another customer who complained happy. But I wouldn't bet on it, as they probably suspect you'll buckle under the threat. Certainly don't actually go into legal action unprepared. You would be better off establishing your position first rather than reacting to a live case.

Gtd

princeofpounds said:

This is a textbook case of some of the pitfalls of buying new builds.

Firstly, there is no such thing as 'mis-selling' property. 'Mis-selling' is a concept where the vendor of a product owes a duty of care to their customer. It became a particularly popular approach for regulators in the financial sector over the past couple of decades, on the assumption that the average person is too stupid to understand what they are buying.

You can argue about whether that is right or not, but the key point is that no such regulatory concept exists in the sale of real estate. In fact, real estate is even exempted from many of the more standard consumer protection regulations. You have more protection buying a mobile phone that you do buying a house. You may have heard the phrase 'Caveat Emptor' - it means buyer beware, and it's often used in conjunction with buying property. You are basically expected to do all your own due diligence - or employ professionals to do it for you - and what you contract to is what you contract to (with some rare exceptions, perhaps).

The sales people can pretty much say whatever they like, especially if it's not written down on paper so you have no evidence trail. The only thing that matters in the end is what was included in the contractual documents you exchanged on. The title plan, the title deed, the sellers' property information form etc. If what the sales people told you is different to what was in the documents, you should have raised that specifically with your solicitor in writing.

Using the recommended solicitor is also foolish. There is a conflict of interest, although only indirect so it's not illegal for developers to push business in that direction. The solicitors do owe you certain duties, but in the back of their minds will be the longer-term business relationship with the developer, so they tend to do the minimum required to stay on the right side of the line. A legal 'work-to-rule', if you like, rather than a passionate defence of your interests.

If they had neglected to inform you of something major, or mis-advised you, you may have a claim against the solicitor. But the problem you have is that they very likely have a good defence for all of this. They would have shown you the title plan. They would have shown you the covenants. They would have asked you if you had any questions and if you were happy with what you saw. But you relied on the verbal assurance of a salesperson over making hard legal enquiries. 

Do you have any idea why they are so keen to keep this space open? Are they trying to given other residents the impression that it is some kind of communal amenity? Or does it just look nicer that way?

Anyway - yes, it is quite likely that once they have finished marketing they will no longer care about any of the covenants. After 25 years with no action, they would lose the ability to enforce them. But clearly they do for now. If you want an easy life free from legal proceedings, then you should comply for now. If you want to fight it, it may be a disproportionately long and expensive process, and you may not succeed or only partially. But here are a few things to think about:

- If you can evidence that you were given an informal go-ahead by the developer, you could potentially try to discharge the covenant at a Upper Tribunal, on the grounds of express or implied permission. In theory, your solicitor should have made notes about their enquiry on this point, but they probably didn't. Perhaps the redundant sales manager will provide you with a statement?

- There may be other legal arguments you could deploy. You could argue that the lack of a fence is of no benefit to the beneficiary. You could argue that it impedes reasonable use of the land. But bear in mind these arguments will not be assessed against your own opinion - they are technical legal arguments that will be assessed against statue and case law, and you will need legal advice on this too.

- You may be able to work around the covenant itself - 'not to alter or heighten any fence' is quite specific language. On a layman's reading it may not technically apply to new fencing, but you'd need legal advice on that point of detail to be confident. Or you can potentially try different methods of asserting your right of ownership, assuming it doesn't break other covenants. You can plant a thick and thorny hedge for example, that's almost as good as a fence. Or you can possibly park cars on the land. Or dig a ditch. Use your imagination, you know the land better than we do.

- You may choose not to remove the fence until you get formal notice of legal action. It's possible that they will not bother going that far, and are only serving the notice to preserve their rights to the covenant or to keep another customer who complained happy. But I wouldn't bet on it, as they probably suspect you'll buckle under the threat. Certainly don't actually go into legal action unprepared. You would be better off establishing your position first rather than reacting to a live case.

Thank you for this. 

Few points, yes I think it is just kept open to make the are look “nicer” especially to the potential complainant. 

Also i can evidence that the complaint was made in writing to the solicitor at the time. But was never answered in writing, as I described the conversations with the now redundant sales manger. No resolution was ever sought I. Writing or otherwise apart from the verbal. So , if a verbal agreement so to speak, doesn’t stand up for me in relation to fence with the developer, neither would a verbal conversation with my solicitor. Also, I have spoken personally with the redundant sales manager yesterday as I have her number. She was very interested and I think she would help

getmore4less

First thing you do when buying is look at the planning application(s).

If you ask for a change you check those changes go into the planning 

There will probably be reason this sub plot was not incorporated properly into one of the houses or even built on.

Does(did) it have any form of boundary separation from the rest of the site   

Few points, yes I think it is just kept open to make the are look “nicer” especially to the potential complainant

Could it be it is part of the required open space on the development and they have stuck on one of the plots to offload  the maintenance.