JOSEPH AND KAYLET CHOJECKI LP/32/2003

UPPER TRIBUNAL

LANDS CHAMBER

LP/32/2003

Case No LP/32/2003

Between

JOSEPH AND KAYLET CHOJECKIApplicant

Before

The President

Mark Sefton (instructed by Neale Turk, solicitors of Fleet) for Applicant

Venue Procession House, 110 New Bridge Street, London EC4V 6JL

Date 19 November 2004

Hearing 19 November 2004

Property: 1 St Michael’s Gardens, `, Winchester, Hampshire SO23 9JD

Catchwords: RESTRICTIVE COVENANT – admission of objectors – objectors with leasehold interests only not admitted

[1]The applicants in this case, who own a dwellinghouse at 1 St Michael’s Gardens, Winchester, seek the modification of certain restrictive covenants that have the effect of preventing them from building, as they wish to do, in the garden of those premises a garage and 2-bedroom dwellinghouse. The application was made on 27 June 2003. It stated that it was thought that the benefit of the covenants might attach to each of the other properties in St Michael’s Gardens, and that the applicants would invite the Tribunal to assume this, but without prejudice to any contention that they might later raise as to the entitlement of particular objectors. It identified as the legal instrument under which the restrictions were imposed a conveyance of 12 May 1988 from Arrowhawk Limited.

[2]The Registrar directed that notices of the application should be served on the owners/occupiers of numbers 2 to 15 St Michael’s Gardens and on Arrowhawk Limited and should be exhibited on the application land. The applicants’ solicitors, Neale Turk, on 10 November 2003 certified that these directions had been complied with. Objections to the application were made by the occupiers of six of the other properties in St Michael’s Gardens. On 19 December 2003 the Registrar wrote to Neale Turk asking them to confirm which, if any, of the objectors they felt were entitled to the benefit of the covenant. Neale Turk’s reply of 27 January 2004 said that they confirmed that all the objectors were entitled to the benefit of the covenant.

[3]On 28 May 2004 Neale Turk wrote to the Tribunal saying :

“Further to our letter of 27 January 2004, we have now considered the position further and have come to the conclusion that none of the Objectors has the benefit of the covenant dated the 12th May 1988, however the legal issues arising therefrom are relatively straightforward and it is our respectful view that there is no need for a separate Hearing in order to determine the issues. The matter can be dealt with at the substantive Hearing and will not unduly affect the length.”

[4]On 9 June 2004, on my instructions, the Registrar wrote to Neale Turk saying that I did not accept that they should necessarily be allowed at that stage to raise the issue of entitlement or that, if it were to be dealt with, it was properly to be dealt with at the substantive hearing. They were required to send a statement setting out their contentions on the issue. A statement, in the form of written submissions from counsel, was received by the Tribunal on 23 June 2004.

[5]The submissions contended that three of the objectors – Mr Richard White of 5 St Michael’s Gardens, Mr Trevor Nuttall of number 14, and Mrs Daphne Herriott of number 15 – did not have the benefit of the covenants since each of them only had a leasehold interest. It was accepted, however, that Mr Colin Hulme and Mrs Melanie Hulme of number 8, as freehold owners who derived title from Arrowhawk Limited, did have the benefit of the covenants and 2 were entitled to object. In respect of Mrs Rosemary Spedding of number 6 and Dr Russell Burdekin and Mrs Carol Burdekin of number 10, who were freehold owners of each of these properties, it was submitted that there was no sufficient evidence to prove that they were entitled to the benefit of the covenants since there was nothing to show that Arrowhawk Limited were the owners of each of those properties at the time of the 1988 conveyance of the application land. I directed that a hearing should be held for the purpose of determining under section 84(3A) of the Law of Property Act 1925 which persons are to be admitted to oppose the application.

[6]At the hearing before me Mr Mark Sefton for the applicants accepted that Mrs Spedding and Dr and Mr Burdekin were entitled to the benefit of the covenants. A statement of Mrs Spedding dated 27 October 2004, which had been served on the applicants on 5 November 2004, attached a letter from Arrowhawk Limited dated 27 February 1987. This letter, Mrs Spedding said, was among the papers that she received upon her purchase of the freehold of number 6 in December 1997. It said that they had instructed Seymour Consultants Limited “to act on our behalf in respect of the property of which you are the lessee.” It was in the light of this, Mr Sefton said, that it was properly to be inferred that at the time of the 1988 conveyance of the application land Arrowhawk owned the freehold of numbers 6 and 10 St Michael’s Gardens. Accordingly both Mrs Spedding and Dr and Mrs Burdekin were entitled to object.

[7]The three leasehold objectors, Mr White, Mr Nuttall and Mrs Herriott, have leases of 999 years from 1 January 1972. They were granted on different dates in 1972. The leases are held of Treeview Trading Limited, the successor in title of Arrowhawk Limited. Each of the leases contains covenants in similar terms to those that the applicants are seeking to have modified in relation to their own property in the present proceedings. The leaseholders submitted that the imposition of the covenants in relation to each of the properties showed that there was a scheme applying to all of the properties. The long leaseholders had only fractionally less equity than the freeholders, and they ought to be able to object to the proposed modification, particularly as the freeholder, Treeview Trading, had not been served with notice of the application.

[8]The covenants affecting the application land were imposed by clause 3 of and the Third Schedule to the conveyance of the application land dated 12 May 1988 made between Arrowhawk Limited as vendor, Terence Moran as the first purchaser and Rosemary Hayhurst as the second purchaser. The recital to the conveyance records that, at the date of the conveyance, Arrowhawk Limited was the freehold reversioner of the application land and the purchasers were lessees under two leases dated 8 May 1972 made between Bendall Developments Limited as landlord and Margaret Leisham (in the case of the first lease) and Doris Fogwell (in the case of the second lease). In other words, the covenantee Arrowhawk Limited is the successor in title to the whole or part of a freehold reversion which had previously been owned by Bendall Developments Limited, and out of which Bendall had previously granted a long lease of the application land. By the terms of the conveyance, the two purchasers acquired the freehold reversion to their leases. The covenants which they gave were expressed to be with the vendor for the benefit and protection of “the estate and property of the Vendor retained by it known as St Michael’s Gardens Winchester”. 3

[9]There can be no doubt that the leaseholders do not have the benefit of the restrictive covenants that are the subject of the present proceedings. The benefit attached to the freehold interest that Arrowhawk held at the time of the 1988 conveyance. Although under section 78 of the 1925 Act a leaseholder can acquire the benefit of a restrictive covenant as successor in title to the freeholder covenantee, in the present case the leaseholders are not successors to the freehold interest of Arrowhawk as it existed at the time of the 1988 conveyance. Their rights derive from their leasehold interests created in 1972. They do not, therefore, have the benefit of the covenants and they are accordingly not entitled to object.

[10]I said at the hearing that the leaseholders were not to be admitted as objectors, and I invited submissions as to costs. Mr Sefton submitted that the leaseholders should pay half the applicants’ costs of the preliminary issue, and there should be no question of the freeholders, Mrs Spedding and Dr and Mrs Burdekin, having their costs because the documentation establishing their entitlement to the benefit of the covenants had only been provided at the last moment. Mr Moulson said that the points at issue could have been cleared up if the applicants had been prepared to talk, and if they had found out who the freeholders were and served notice of the application on them.

[11]As I have said, the applicants originally accepted that all the objectors were entitled to object, and it was only some 4 months later that they retracted this admission and challenged the objectors’ entitlement. They made their position clear in the submissions that were received on 23 June 2004, and they have only been allowed to pursue their challenge at the present hearing in the light of those submissions. In those submissions they accepted that the objectors Mr and Mrs Hulme were entitled to object; they put Mrs Spedding and Dr and Mrs Burdekin to proof of their entitlement, and accepted that they were entitled when sufficient documentation was produced; and they maintained that the leaseholders were not entitled to object. As the Tribunal (Judge Rich QC) stated in Re Wealden Land Ltd (LP/8/2003, 28 January 2004 at para 35), where an objector lays claim to an entitlement which he fails to establish and thereby puts the applicant to expense, the usual rule as to costs, that they follow the event unless there are special reasons, will apply. I can see no reason why the leaseholders should not have to pay an appropriate proportion of the applicants’ costs of this hearing, to the extent that such costs were incurred after the service in June of the applicants’ submissions. Since then five objections have been in issue. The proper order in my view is that Mr White, Mr Nuttall and Mrs Herriott should each pay 20% of the applicants’ costs of this hearing incurred after 23 June 2004. 10 December 2004 George Bartlett QC, President 4