Delay Means Loss for Property Owner
A recent case involving a Welsh landowner illustrates the wisdom of acting promptly when a covenant on a property is breached.
Mr Williams-Wynne had sold the right to purchase a piece of land to Mr Harris, provided Mr Harris made a request in writing within 21 years. The agreement included a clause that Mr Harris could not erect any structures on the land without the permission of Mr Williams-Wynne. In 1991 Mr Harris obtained planning permission for a garage and laid the foundations in 1997. Over a period of several years he built the garage without asking the permission from Mr Williams-Wynne. In 2002, Mr Harris decided to sell the land and requested the transfer of the title to the land under the original agreement.
Mr Williams-Wynne demanded half of the development profit for granting his permission. In court, it was conceded that Mr Williams-Wynne would have been aware that development was taking place by early 2000. However, he failed to take any action until March 2003.
In the view of the judge, Mr Williams-Wynne’s actions were unconscionable in that he had allowed Mr Harris to act to his own detriment. He could have applied for an injunction to prevent the development at an early stage, but he did not. However, his delay did not mean he lost all right to compensation. It was likely that had the matter been raised at an early stage, Mr Harris would have paid Mr Williams-Wynne a reasonable sum for the release of the covenant. Assuming a bargain at arm’s length for the release of the covenant, the judge decided that Mr Harris should pay Mr Williams-Wynne the sum of £8,000,
It is sensible for anyone developing land to check what covenants may apply before they start and for people protected by covenants to take advice promptly when they realise a breach has occurred.
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