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Historic Property Rights May Be Unenforceable

A recent case[1] held that historical rights which might otherwise have frustrated a proposed site development would not apply because they relied on a prior scheme of development (dated 1908) that had not been implemented. As this historic scheme was only evidenced in other conveyances, and even then not consistently defined, the corresponding rights were held to be unenforceable.

Facts: Birdlip Ltd (B) sought to build new detached houses on his property and obtained planning permission to do this. Restrictive covenants applied to the property, dating from indentures in 1909 and 1910, limiting the landowner’s rights to build on the concerned plot of land. Hunter (H) claimed that they were able to enforce these covenants as part of a scheme of development to which their predecessor was a party. B sought a declaration from the court as to whether these covenants were enforceable by H. Two documents for sale were presented to support this claim, dated 1908 and 1914, which both included a plan highlighting “the estate boundaries” as well as plots of land within these. However there were significant differences in the land within the estate boundaries on each form. In addition these plans were not included in the 1909 or 1910 conveyance.

High Court Judgment: On first trial, the high court found that the covenants did apply, finding the 1908 plan did define the boundaries of an estate, that there would originally have been such a plan attached to the 1909 and 1910 conveyances and that there were a number of legitimate reasons for why the 1914 plan may be different from the 1908 plan, including the sale of certain lots in the estate.

Court of Appeal Judgment: This decision was reversed on appeal. Firstly the court noted that no binding authority existed allowing the court to establish the existence of a housing scheme based purely on extrinsic evidence. The 1909 and 1910 conveyances included no mention of such a scheme. Among other factors, the documents showed no lots and made no mention of an estate. In addition there was no express mention of the covenants being mutually enforceable. Secondly the court ruled that even if a scheme could be established by the 1908 and 1914 documents in theory, the documents in this case were not sufficient to do this. To be mutually bound, all buyers must know the area of the estate and a buyer referring to the 1914 plan would have a very different idea of the size of the estate than one referring to the 1908 plan, whatever the reason for this may be.

Conclusion: Though this case is exceptional in terms of the age of the covenants in question and the paucity of available evidence, it is nonetheless a useful guide as to what the courts will accept as evidential requirements for the existence of a scheme of development over older properties where documentation may be incomplete. This may be of particular importance to cases involving older properties, where there may be a number of historic transactions involving the property with which the current tenants may not be familiar.

[1] Birdlip Ltd v Hunter & Anor [2016] EWCA Civ 603

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