Restrictive covenants are often drafted in such a way that the consent of a third party (whether an individual or a company) must first be obtained before the use to which a property is put is altered or that the plans of the development must be approved before any development takes place.

The case of Crest Nicholson v McAllister established in 2002 that where a party whose consent is required dies or (in the case of the company) ceases to exist, the restriction falls away.  That judgement was however one which turned very much on the facts specific to that case.  This has been emphasised by the judgement handed by the Lands Tribunal in relation to a property known as Hutchins Cottage.  That case concerns two covenants both of which required the consent of a third party, one restricting the erection of or alterations to buildings and the second which provided that no building on the property in question could be used for anything other than as a private dwelling house.

The lands tribunal, applying the judgement handed down in Crest Nicholson v McAllister, determined that since the third party whose consent was stated in the covenants to be required was no longer alive, the covenant relating to the approval of plans fell away. Significantly, the covenant restricting the change of use of the property did not.  The judgment therefore had the effect of making the covenant into an absolute bar to any change of use of the property in the future.

This case emphasises the importance of scrutinising restrictive covenants carefully where considering redevelopment and / or changes of use of a property. Covenants cannot be assumed to be redundant simply because an individual has died or a company has ceased to exist. Where there is any doubt as to whether a covenant has been extinguished, all of the usual avenues to circumvent the covenant and failing that mitigate the risk of it being enforced will, as ever, need to be explored and considered.