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CHAPTER 14 RESTRICTIVE COVENANTS

The modification or discharge of a restrictive covenant

Compensation under section 84 of the Law of Property Act 1925 was looked at in Winter v Traditional & Contemporary Contracts Ltd [2007] EWCA Civ 1088; [2008] 3 EG 180. Mr and Mrs Winter were claiming compensation for the modification of a restrictive covenant. It was held that a claim based on a hypothetically negotiated share of the profits was recognised in civil proceedings for breach of a restrictive covenant. However, compensation under section 84 was based on the impact of the development on the objectors, not on the basis of a share of the profits: see SJC Construction Company Ltd [1976] RVR 219 and Stockport MBC v Alwiyah Developments [1983] 52 P&CR 278. Compensation was to be awarded based on the loss to the objectors of the use or value of their land. This did not eliminate the hypothetically negotiated share argument which could still be used where the loss in value was not a fair reflection of the objector’s subjective loss.

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