Graham v Easington District Council, Court of Appeal - Civil Division, December 02, 2008, [2008] EWCA Civ 1503

Issuing Organization:Civil Division
Actores:Graham v Easington District Council
Resolution Date:December 02, 2008

Case No: C3/2008/1133

Neutral Citation Number: [2008] EWCA Civ 1503





Royal Courts of Justice

Strand, London, WC2A 2LL

Date: Tuesday, 2nd December 2008






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(DAR Transcript of

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Mr H Smith (instructed by Crutes LLP) appeared on behalf of the Appellant.

Mr T Dumont (instructed by MSP Legal Services) appeared on behalf of the Respondent.

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JudgmentLord Justice Carnwath:

1. This is an appeal against a decision of the Lands Tribunal given by Mr Trott FRICS. It concerns an application for the discharge of a restrictive covenant. The Lands Tribunal's jurisdiction derives from section 84 of the Law of Property Act 1925 subsection (1)(aa), which allows a company discharge upon the grounds that:

``in a case formed within subsection (1A below) the continued existence thereof would impede some reasonable user of the land for public or private purposes or, as the case may be, would unless modified so impede such a user.

Subsection (1A) authorises:

``a discharge...of a restriction by reference to its impeding some reasonable user of the land in any case in which the Lands Tribunal is satisfied that the restriction, in impeding that user...

(a) does not secure to persons entitled to the benefit of it any practical benefits of substantial value or advantage to them


and money will be an adequate compensation for the loss or disadvantage (if any) which any person will suffer from the discharge or the modification.''

2. There is also a ground (c), that the proposed discharge would not injure the person entitled to the benefit of the restriction, but it is common ground that that raises no separate issue in this case.

3. The appellant is entitled to the covenant as an adjoining landowner but is also the local planning authority. The site in respect of which the application discharge was made is part of an industrial estate on the edge of a settlement called Horden in the county of Durham. There is residential development to the west, and further to the west the town of Peterlee. Much of the estate is owned by the council but it has sold off parts for various industrial or warehouse uses. The Member gave a full description of the estate and the position of the site within it in paragraphs 8 onwards of his decision, and I do not need to repeat that.

4. The covenant is in the following terms:

``The Transferee hereby covenants with the Transferor on his own and his successors in title:

(i) not to use the property for any purpose other than as a coach depot with an associated bungalow for residential use. Occupation of the bungalow must be linked with the use of the land as a coach depot and the bungalow cannot be sold or leased except from the depot.''

5. That covenant was imposed on the transfer of the freehold by the council to a Mr Pygall in July 2000. Mr Pygall then sold the land to a Mr Graham. The background of all that is not particularly material for the present purposes because the important point for our purposes is that in 2004 Mr Graham decided to apply for outline permission for residential development for some 30 houses on the site. That proposal came before the council as planning authority in April 2005 when it granted planning permission. Mr Graham then applied to the Lands Tribunal for release of the covenant to enable him to carry out that development, and that is the proposal which came before the Member.

6. Not surprisingly, at the heart of the decision of the issues before the Member, as before use, was whether the council could justify its apparent change of heart: from having granted permission, in its capacity as planning authority, to its later refusal of the discharge of the covenant under the Law of Property Act. Although that seems a relatively narrow issue, the case was hard fought before the tribunal and took some three days of evidence, the council calling no less than six witnesses.

7. The Member's decision sets out very fully the arguments of the parties and the evidence. He also explained the relevant law. Although we have been referred to a number of authorities, it does not seem...

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