When purchasing a property, it's crucial to be aware of property covenants, as they can significantly impact your plans. Breaching a covenant can lead to substantial financial consequences, so understanding these legal obligations is essential.
What is a Covenant?
A covenant is a legal obligation contained within the title deeds of a property that a new owner must adhere to. Typically, covenants apply indefinitely, meaning they affect all future owners of the property, therefore, it's important for buyers to identify any covenants associated with a property they are considering.
Types of Covenants
There are two primary types of covenants: positive and restrictive.
Positive Covenants
Positive covenants require property owners to perform specific actions or contribute financially to certain aspects within the property boundaries. Legally known as "burdens," these obligations often involve maintenance or shared responsibilities. Positive covenants usually involve two parties, with one party benefiting from the covenant.
Restrictive Covenants
More common than positive covenants, restrictive covenants impose limitations on what property owners can do within their property boundaries. These covenants often prohibit specific activities or alterations, such as construction work. Like positive covenants, there is typically a party that benefits from and enforces the restrictive covenant.
Common Examples of Covenants
Restrictive Covenants:
- Prohibiting property alterations, such as building extensions or converting a house into flats.
- Restricting the construction of buildings or other substantial structures on certain parts of the land.
- Banning the operation of trades or businesses on the property.
- Prohibiting the keeping of livestock.
Positive Covenants:
- Maintaining a fence or shared driveway.
- Repairing a shared roof.
Why Are Covenants Needed?
Covenants provide landowners with control over how the land they sell is used and its appearance. Often, covenants are established during the initial sale of land, possibly from a Greenfield site to a residential development. The seller might insert a restrictive covenant to maintain the area's residential nature or ensure that any building alterations align with the area's character.
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Consequences of Breaching a Covenant
Breaching a covenant can have serious repercussions. Depending on the covenant, you might have to undo extensive projects, such as extensions, if they are not permitted. Legal action or financial penalties can also result from covenant breaches. Therefore, it is imperative to thoroughly understand your property deeds before making any significant changes.
Modifying or Removing Covenants
If a covenant on your property deeds seems unreasonable, you can apply to the Lands Chamber of the Upper Tribunal to have it modified or discharged. However, this process can be costly and time-consuming, additionally you may need to compensate the party benefiting from the covenant and cover legal fees.
Frequently Asked Questions
How to Find Covenants on Property:
When purchasing a property, request your conveyancer to examine the title deeds thoroughly for any covenants. Once you sign the deeds, these covenants become your responsibility, breaching a covenant, even unknowingly can lead to liability.
Should I Buy a House with a Restrictive Covenant?
The decision depends on the specific restrictive covenant. If the covenant does not hinder your plans, such as not intending to make prohibited alterations, it might not affect your decision. However, if you plan to utilize significant land attached to the property for building, ensure there are no restrictive covenants.
Are Covenants Legally Binding?
Properly established covenants are legally enforceable. It's important to check if a covenant "runs with the land," meaning it applies to all future owners, or if it was only enforceable on the first owner.
How Long Does a Covenant Last on a Property?
Covenants typically last indefinitely, even if a covenant dates back to the 19th century or earlier, it retains its legal status. Nonetheless, some very old covenants might be considered unenforceable due to their archaic nature or irrelevance due to subsequent developments.
What Does a Deed of Covenant Mean?
A deed of covenant is a legal document where the party burdened with a covenant agrees to fulfil the covenant's obligations.
Contact Howards for Assistance with Your Property Search
If you're interested in purchasing a property, reach out to your local Howards branch for expert assistance and guidance.
Being informed about property covenants ensures that you make well-informed decisions and avoid potential legal and financial pitfalls. Whether it's maintaining a shared space or adhering to restrictions, understanding these obligations is crucial for any property owner.
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