Once more into the breach – building in breach of restrictive covenants

The case of Darby & Darby (a firm) v Joyce highlights the need to carefully consider restrictive covenants prior to commencing building works.

The defendant acquired a residential plot subject to a restrictive covenant “[not] to make any alteration or addition to the exterior or external appearance of the Property or the buildings thereon nor to erect any walls, fences or buildings (whether temporary or otherwise) without first obtaining the written consent of the Transferor”.  Unfortunately the defendant was, the court held, not advised by her solicitors of the existence of the covenant and began various works to the property.

Shortly after commencing works the defendant received a letter from solicitors asserting the benefit of the restrictive covenant and objecting to the works that were being carried out.  The defendant continued the works, leading to a successful interim injunction against the defendant compelling her to cease works entirely. 

At trial the court was not inclined to imply a term within the covenant requiring the transferor not to “unreasonably withhold consent” as the courts have, in some instances, been inclined to do, such as in Rickman v Brundenell-Bruce.  In Darby, the covenant restricted all works without the prior consent of the Transferor, whereas in Rickman, the court was persuaded to impose an implied term into the covenant requiring consent not to be unreasonably withhold, where the consent related not to the works as a whole, but to the manner in which works were to be done i.e. to the type and size of material used in the works. 

Darby therefore indicates a potential unwillingness of the courts to imply a term requiring consent not to be “unreasonably” withheld where the covenant provides an outright ban on works without the consent of the beneficiary of the covenant.

Care needs to be taken when interpreting covenants, as courts will not always imply a test of reasonableness where consent is required prior to the commencement of works.

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