The Upper Tribunal (Lands Chamber) has granted MDM Civil Engineering Limited's application to modify a covenant limiting a Lincolnshire site to two dwellings, where the only objector did not hold the covenant's benefit.
Key facts
- Who: Owners of land subject to restrictive covenants and the people who hold their benefit
- From: Judgment dated 10 September 2026
- Source: MDM Civil Engineering Limited v Scott Morgan [2026] UKUT 347 (LC)
The Upper Tribunal (Lands Chamber) decided MDM Civil Engineering Limited v Scott Morgan [2026] UKUT 347 (LC) (Case No LC-2025-372) on 10 September 2026. The application was made under section 84 of the Law of Property Act 1925, and the judgment records that it was granted.
Background
The Ark, a community building at Witham St Hughs in Lincolnshire, was demolished for development. A transfer dated 1 May 2019 from Rysa Lodge Residential Properties Limited (Rysa) to M&D Homes Limited contained a covenant. It said the property could not be used for any purpose other than as two private dwellinghouses. A price of £75,000 was agreed on the basis that development would be limited to two houses.
Two houses were built and sold. The applicant, MDM Civil Engineering Limited, later became owner of the undeveloped remainder. An application for a third dwelling in December 2020 was withdrawn. Applications in August 2021 and July 2022 were refused, and both refusals were upheld on appeal. Planning permission was granted on 16 July 2025. MDM then asked the Tribunal to modify the covenant so that the third house could be built.
The question
MDM relied on three grounds in section 84(1):
- the covenant was obsolete (ground (a))
- it impeded a reasonable use of the land while securing no practical benefit of substantial value to the person with its benefit (ground (aa))
- modification would not injure the people entitled to its benefit (ground (c))
The Tribunal had to decide whether a ground was made out and, if so, whether to exercise its discretion.
The parties
Mr Morgan, owner of 2 Gray Lane, was the only objector. He had misunderstood references to the restrictions in his title deeds. At the hearing he accepted that his house carries the burden of the covenant rather than the benefit. The expert evidence about the effect on his property was therefore irrelevant.
Rysa, which imposed the covenant, did not file a formal objection because it considered the costs prohibitive. It wrote to the Tribunal opposing modification. It said that, if the Tribunal did modify the covenant, the applicant should pay it £37,500.
The reasoning
The Tribunal said it does not exercise its discretion under section 84(1) simply because nobody with the benefit of the restriction has chosen to take part. The applicant must persuade it that a statutory ground is made out and that the restriction should be modified. Mr Morgan's points could be relevant at the first, jurisdictional stage even though he did not hold the benefit. Uncontested facts raised by Rysa were relevant at the discretionary stage.
On ground (a), the Tribunal did not accept MDM's submission that the character of the area had changed enough to make the covenant obsolete. It noted that the houses to the north and east of the site remain unchanged.
What this means for landowners and neighbours
- The Tribunal looks first at whether an applicant has made out a statutory ground, and only then at whether to exercise its discretion.
- Whether a person holds the benefit or the burden of a covenant made this case unusual. Mr Morgan's house carried the burden, so his objection could not rest on the covenant's benefit.
- The Tribunal has power to direct payment of consideration where a covenant is modified. Rysa asked for £37,500.
- Anyone affected by a restrictive covenant may wish to check what their title documents say about whether they hold its benefit or its burden.
Sources
- MDM Civil Engineering Limited v Scott Morgan [2026] UKUT 347 (LC), Upper Tribunal (Lands Chamber), 10 September 2026