Restrictive covenants

eve824

Hi
We are purchasing a plot of land with PP for a house. The plot is the garden of the existing house and is being split as part of the sale. The house part is also being sold at the same time although they are a few weeks ahead of us in terms of conveyancing. The vendor of both properties has already bought a retirement flat for cash so end of chain.
We received the transfer document through last night to read as there are some service right of way issues that need to be agreed. It contained a huge long list of restrictive covenants that we had never been told about and don't exist on the existing plot (we checked the LR records). Why could the seller want to include these given he is selling both house and garden and so effectively will have no interest in either? I could understand somewhat if he was staying in the house and wanted to 'retain control' but he is moving to the next town. Or could this just be a case of solicitor adding in boiler plate templates to the transfer document without checking?

We have gone back and suggested we will not be able to proceed until two in particular are removed which seem unnecessary and hugely problematic for us. The rest I can live with. We are a bit concerned that they will refuse, but I am struggling to understand why they are there in the first place!

eddddy

Presumably, those restrictive covenants are there to make the existing house easier to sell. What are the covenants?

davidmcn

eddddy said:

Presumably, those restrictive covenants are there to make the existing house easier to sell. What are the covenants?

They are likely to be there in order to protect the interests of both properties. And (although the OP hasn't given us any clues) I suspect aren't really "restrictive". OP, haven't you talked to your solicitor yet?

davidmcn

eve824 said:

We have gone back and suggested we will not be able to proceed until two in particular are removed which seem unnecessary and hugely problematic for us.

Are you going to tell us what they are? Otherwise I'm not sure how we're supposed to advise!

eve824

The two that are problematic for us are, no business use (we both WFH and plan to run consultancy business from home later in life) and no caravan / mobile home parked on site (we own a vintage trailer that we intended to park in the garden under cover when not using, also we need to live in a mobile home temporarily whilst we build the house, which they know about).

Both are absolute deal breakers for us unfortunately. This is to be a very long term home.

eve824

I've told our solicitor we cannot accept the two in particular and waiting to hear back. There are others in there which seem a bit vague and unnecessary but we can live with.

davidmcn

Both are pretty much bog standard, not sure why you're struggling to understand why they're there, as your solicitor should be able to advise similarly. And I presume all of these are going to be mutual i.e. you'd also have the right to enforce the similar conditions on the neighbour's title?
"Business use" means something which might actually affect the neighbours (e.g. manufacturing / storing / having clients visiting), not just quietly doing work stuff on your laptop.
I expect the trailer point can at least be watered down to something acceptable to you.

eve824

davidmcn said:

Both are pretty much bog standard, not sure why you're struggling to understand why they're there, as your solicitor should be able to advise similarly. And I presume all of these are going to be mutual i.e. you'd also have the right to enforce the similar conditions on the neighbour's title?
"Business use" means something which might actually affect the neighbours (e.g. manufacturing / storing / having clients visiting), not just quietly doing work stuff on your laptop.
I expect the trailer point can at least be watered down to something acceptable to you.

No houses I or any of my family have ever owned have had either of these points, so I don't agree that they are 'bog standard'. Perhaps in new build estates, yes, but we are not buying in a new build estate, but an established road of mixed style houses in a village.
Vendor is well aware of our situation needing to live in a mobile home on site during the build so hence why I am struggling to understand why this has suddenly popped up and is, hopefully, an error.
No idea if they are mutual or not. I couldn't care less if they are to be honest. They are not present on any of the other neighbours properties who all have caravans / trade vans parked out front so it wouldn't make much difference to me.
Re the business use - says who? If we were to have a registered address for a LTD co at our address I bet that would be interpreted as breaking the covenant. That's the issue - it's so vague and open to interpretation.

Anyway, it's fairly cut and dry for me so will wait for our solicitors response. 

greatcrested

eve824 said:

The two that are problematic for us are, no business use (we both WFH and plan to run consultancy business from home later in life) and no caravan / mobile home parked on site (we own a vintage trailer that we intended to park in the garden under cover when not using, also we need to live in a mobile home temporarily whilst we build the house, which they know about).

Both are absolute deal breakers for us unfortunately. This is to be a very long term home.

These are both fairly common covenants on new build estates these days, so not that surprising.

Ad as David points out above, are probably there to protect the buyers of the existing house and make it more attractive to buyers.

As your property will be in what used to be the existing garden, I assume the houses will be in close proximity (possibly with shared access?), so caravans and customers coming/going will not be conducive to the new owners.

You can ask for the covenants to be removed and te sellers might or might not agree. If they don't, you can then choose to buy or not to buy.

davidmcn

eve824 said:

davidmcn said:

Both are pretty much bog standard, not sure why you're struggling to understand why they're there, as your solicitor should be able to advise similarly. And I presume all of these are going to be mutual i.e. you'd also have the right to enforce the similar conditions on the neighbour's title?
"Business use" means something which might actually affect the neighbours (e.g. manufacturing / storing / having clients visiting), not just quietly doing work stuff on your laptop.
I expect the trailer point can at least be watered down to something acceptable to you.

No houses I or any of my family have ever owned have had either of these points, so I don't agree that they are 'bog standard'.

I didn't say they literally apply to every single property, but they are extremely common and something similar will feature in the titles of millions of houses, not just newbuild but stuff from half a century ago too. There is absolutely nothing untoward or unexpected in the proposal that they're incorporated into the titles for a plot being subdivided.

Re the business use - says who?

The case law if you really wanted to do some research, I expect you can find something about the degree to which a literal breach of a covenant has to amount to an objective problem before courts will be minded to order it to be stopped. In the same way that you don't need planning permission to change the use of your house just because you're doing some work in your study.

If we were to have a registered address for a LTD co at our address I bet that would be interpreted as breaking the covenant. That's the issue - it's so vague and open to interpretation.

Use some common sense - why would the neighbours go to the trouble and expense of trying to enforce the covenants unless you were causing them a genuine problem? Why would they care about what post you received?

But at least they are up for negotiation at the moment, rather than you having to wonder whether to accept existing conditions.