Does this mean I can't run a business from my property?

Snorky85 · Mar 25, 2019

This is an extract of the deed of covenant relating to my house, which is part of a gated development where we pay into a management company to run the site for us, and for which we have a share.

Could someone confirm exactly what it means? Many thanks in advance.

"The Covenantor's Covenant

The Covenantor covenants with the Management Comapny:-

2.1 not use the Property for any purpose other than that of a private residence but this shall not preclude the use of no more than 15% of the floor space within the buildings on the Property as an office which shall not involve visiting by members of the public."

AllUpHere · Mar 25, 2019

You can use a small part of the property as an office, as long as clients don't visit.

Snorky85 · Mar 25, 2019

That's what I thought. So I can't set up a plant/nursery business on my land?

AllUpHere · Mar 25, 2019

Nope, just private residential use, apart from using 15 % of floorspace for admin work.

WaveJumper · Mar 25, 2019

So the way I read this is:
You can have an 'office' but know one can visit, so if you can run your business without face to face contact no problem

WaveJumper · Mar 25, 2019

LOL no nursery maybe the odd window box

Snorky85 · Mar 25, 2019

Thanks again - that is also my thoughts on it so pleasing to have confirmation. Next question - how could this type of covenant be enforced?

AllUpHere · Mar 25, 2019

Snorky85 said:
Thanks again - that is also my thoughts on it so pleasing to have confirmation. Next question - how could this type of covenant be enforced?

I'd imagine if the restrictive covenant was well drafted and difficult to challenge it would be a case of the other party getting a court order forcing you to cease using the land for business use.

Snorky85 · Mar 25, 2019

Sorry to keep asking question, but appreciate your replies. How could a court order enforce it? How do you think that would work?

estwig · Mar 25, 2019

The covenant is basically the same as planning, your home is residential, no business on the premises at all really. It is tolerated if it doesn't disturb the neighbours, so no clients visiting, no noise and no excessive deliveries.

Starting a nursery breaks your covenant and class usage of the premises.

Snorky85 · Mar 25, 2019

Thank you for the confirmation. So any idea how a court order could successfully enforce this?

The Byre · Mar 26, 2019

You are asking a brilliant question! Some property covenants are actually unenforceable! Assuming that the covenant has been properly drafted and you are the freehold owner of the property, it would be a matter of tort and normally enforced by litigation.

Assuming that you are the freehold owner of the property, five conditions must be met for the covenant to be enforceable:

1. The covenant must be negative (restrictive). This means that it must prevent an action rather than compel an action to be performed. i.e. "Thou shalt not . . ."

2. There must be benefit and burden and the two must be “reasonably close together” - such as visits by clients adversely affecting the value of a property.

3. The covenant must actually benefit the property. A benefit must be something affecting either the value of the land or the way it is used.

4. It must be the original parties’ intention for the burden (in your case the prohibition of clients' visits) to continue into the future.

5. The purchaser of the property must have had proper notice of the covenant before buying.

So far, so good!

If a covenant has been breached, the Courts can do one of two things - They can either order an injunction to prevent the breach from continuing or they can award damages to the injured party.

Damages can only be awarded if payment of money is sufficient to compensate the injured party and where the award required is measurable and payable (i.e. relatively small).

Where the loss to the covenantee cannot be easily measured in financial terms (e.g. loss of amenity) or where only a large sum would be sufficient, the Court may award an injunction to bring the breach to an end.

In short - IMO the covenant is enforceable and fulfils the five requirements and a court would be right to issue an injunction against you if you were deemed to be in breach.

Snorky85 · Mar 26, 2019

Thank you so much for your insightful replies. I’ve asked these questions as if it were me wanting to run the nursery but infact it is a neighbour with no regard for our gated community/site covenant. Luckily he can’t claim he didn’t have notice of the covenant on the land because he was one of the site developers and is currently a director of the site management company (so i think we are covered on the notice grounds).

So what physical action does the court take-do they confiscate assets? Prevent access to the site?

Newchodge · Mar 26, 2019

How do you know that the site developer's property has the same covenant?
Also, I seem to remember, and my training in property law was 25+ years ago, that the covenant does not carry forward. So, unless the original managment company still has an interest in an affected porperty, the covenant cannot be enforced.

You really need to talk to a solicitor specialising in property law.

Snorky85 · Mar 26, 2019

Newchodge said:
How do you know that the site developer's property has the same covenant?
Also, I seem to remember, and my training in property law was 25+ years ago, that the covenant does not carry forward. So, unless the original managment company still has an interest in an affected porperty, the covenant cannot be enforced.

You really need to talk to a solicitor specialising in property law.

Thank you. Yes we know for a fact the same covenant applies and that they have a share in the management company which can only be obtained following agreement to the covenant. The restrictive covenants are also included on the land registry titles etc.

We will be consultant with a specialist eventually no doubt but I wanted to get some people’s take on this particular situation first-many thanks for your input

The Byre · Mar 26, 2019

Snorky85 said:
So what physical action does the court take-do they confiscate assets? Prevent access to the site?

That would be to disobey a court injunction and that is contempt of court, i.e. up to five years imprisonment or a fine.

Newchodge said:
the covenant does not carry forward. So, unless the original managment company still has an interest in an affected porperty, the covenant cannot be enforced.

That's point four - " It must be the original parties’ intention for the burden to continue into the future." i.e. it must be proven to the court that the original purpose of the covenant was to bind all future parties to not do something - it carries forward.

BUT before we all get ahead of ourselves, the residents need to speak to this man and let him know that you are aware of the covenant and your ability to have it enforced if needs be - and that he should, therefore, shelve his plans for a knacker's yard and combined soap factory.

The Byre · Mar 26, 2019

Newchodge said:
Also, I seem to remember, and my training in property law was 25+ years ago, that the covenant does not carry forward.

Ah! That was then! There've been a few changes since then! Manky old covenants that prohibit the tethering of horses in the yard or forbid the occupancy by Catholics on the Sabbath are no longer either enforceable or even require documenting.

Newchodge · Mar 26, 2019

The Byre said:
Ah! That was then! There've been a few changes since then! Manky old covenants that prohibit the tethering of horses in the yard or forbid the occupancy by Catholics on the Sabbath are no longer either enforceable or even require documenting.

Do you mean that the OP is not required to practice archery on the green? How will we ever defend ourselves if we attack France?

Lucan Unlordly · Mar 26, 2019

Newchodge said:
Do you mean that the OP is not required to practice archery on the green? How will we ever defend ourselves if we attack France?

We won't......no ferries

Snorky85 · Mar 26, 2019

The Byre said:
BUT before we all get ahead of ourselves, the residents need to speak to this man and let him know that you are aware of the covenant and your ability to have it enforced if needs be - and that he should, therefore, shelve his plans for a knacker's yard and combined soap factory.

Oh he knows we know for sure. We know more than him it seems! The reaction when it was brought up was one of aggression. Not very nice. (I wont go into anymore details on those lines) There’s a long way to go with this but we will get there eventually.

Mr D · Mar 26, 2019

The Byre said:
Ah! That was then! There've been a few changes since then! Manky old covenants that prohibit the tethering of horses in the yard or forbid the occupancy by Catholics on the Sabbath are no longer either enforceable or even require documenting.

Yes, strange things put in place for Saturdays.

Hmm... wonder if a convenant limiting work on Sundays has been tried? Must ask my local vicar, he lives in an ancient house and works Sundays.

Chris Ashdown · Mar 27, 2019

You could complain to the council about the use of a business on private property causing noise and inconvenience to other residents, which would cost nothing and may in the long term cause a planning issue

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Does this mean I can't run a business from my property?

The Byre

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