Help with a restrictive covenant...please!

[Michelle]

We purchased a converted barn 2 years ago and the developer (who also lived next door) suggested that we get a garden room extension when I said I wouldn't buy it as I wanted more room! We decided to do just that and got the necessary planning permission but have uncovered in the past few weeks that there is a restrictive covenant on the property for 5 years. Unfortunately, the developer has since moved away leaving no forwarding addresses (as we believe she is in debt) however she was the one to initally mention the extension PLUS she phoned to congratulate us on getting the permission AND she even wanted to quote for the business! Our solicitor made it out that it would be best to try to contact her which we have done via her solicitor. We know she has the letter but has not bothered to respond either way! She is reknowned for her lack of business acumen! We have just been told by our solicitor that we cannot even get an indemnity now because (we did what we were originally told was the "right thing") we have made contact with her. Is there anyway out of this mess? Surely, we must have recourse in some way that she cannot simply abstain from an answer? And given that we have verbal confirmation from her, can we rely on anything here? It would be greatly appreciated if anyone can help!! Thanks.

[JustinN]

I assume that it is the developer who has the benefit of the restrictive covenant, and the problem you have is that you are now trying to sell the property and the buyer is seeking evidence of compliance with the covenant in the form of a consent/release from the developer

If so, I suggest you make a "statutory declaration", detailing exactly what happened, and detailiung the various ways in bwhich the developer encouraged you to build the extension, knew of it and did not object and has failed to respond to correspondence.

The point is that a court will not enforce a restrictive covenant if the person entitled to enforce it has connived in its breach, nor if they have simply sat back and done nothing in the knowledge that it is about to be or has been breached - the person with the benefit of the right musdt act reasonable promptly to enforce it - this is under the equitable doctrine of "laches" - the Wiki pedia entery on this is very useful: Laches (equity) - Wikipedia, the free encyclopedia

A sufficiently clear statutrory declaration should be sufficient comfort to a buyer to enable them to proceed despite the apparent breach of covenant

I hope this helps

[JustinN]

I assume that it is the developer who has the benefit of the restrictive covenant, and the problem you have is that you are now trying to sell the property and the buyer is seeking evidence of compliance with the covenant in the form of a consent/release from the developer

If so, I suggest you make a "statutory declaration", detailing exactly what happened, and detailiung the various ways in bwhich the developer encouraged you to build the extension, knew of it and did not object and has failed to respond to correspondence.

The point is that a court will not enforce a restrictive covenant if the person entitled to enforce it has connived in its breach, nor if they have simply sat back and done nothing in the knowledge that it is about to be or has been breached - the person with the benefit of the right must act reasonable promptly to enforce it - this is under the equitable doctrine of "laches" - the Wikipedia entery on this is very useful: Laches (equity) - Wikipedia, the free encyclopedia

A sufficiently clear statutory declaration should be sufficient comfort to a buyer to enable them to proceed despite the apparent breach of covenant

[Michelle]

Thank you Justin - that is really useful advice. In actual fact, we are not looking to sell at the moment but just want to build the garden room having been granted planning permission. We just wanted to make sure we got it right now so that when/if we do sell, it will not pose a problem. I presume your response still stands in this situation as well. Interestingly, the covenant only stands for 5 years so by the time we come to sell it will not be relevant - again do you think this changes anything?

[JustinN]

Building the extension will, presumably, breach the covenant, even if the covenant would not apply to new work when you come to sell, so I don't think there is any comfort there

However, once the extension has been built for a year without challenge, you should be able to arrange indemnity insurance - though you should specifically disclose the original approach to the developer