The tale of the sale of our old house

[Jeremy Harris]

I'm going to spend this morning trying to find out what the covenant is.  I have no record of any covenants at all - the searches from our purchase in 2000 came out clear as far as I can see, and there's nothing on the Land Registry documents I have from that time. 

 

Not sure where the damned thing can be, TBH, if it doesn't show on the Land Registry papers. 

 

The buyer was a religious charitable trust, and they have stated to the agent that the covenant restricts what they intend to do with the house.  Not sure what that means, but it may indicate that they wanted to do something other than use it as a domestic dwelling, perhaps.

 

Anyone know for sure how to get hold of covenants?  AFAICS, just paying the fee and getting another copy of the Land Registry stuff probably won't reveal them, as it didn't when we bought the house, it seems.

[ProDave]

Is it really a covenant, or could it be they spoke to the council about a change of use and were told no?

[Jeremy Harris]

1 minute ago, Moira Niedzwiecka said:

I am so sorry Jeremy.

At least you have other buyers waiting in the wings.

Covenants are nothing to do with searches.

It will be something on the title.

Ask your conveyance to send you the office copy entries from the Land Registry.

 

 

I'll try this, but I already have a copy of the Land Regstry Title from when we bought the place (or more accurately, I have it in a pack of papers handed back to me by the bank when we paid of the mortgage in 2010).

[Jeremy Harris]

Just now, ProDave said:

Is it really a covenant, or could it be they spoke to the council about a change of use and were told no?

 

All they are saying is that their solicitor found a restrictive covenant and that he has advised them that there is no way around it for what they wish to do.  I suppose I should add that the charitable trust that was buying the house is a part of the Plymouth Brethren, a group I have nothing against at all, but which may have some bearing on why they've pulled out.

[bissoejosh]

The restrictive covenants for our site were shown on the TP1 document which we had to sign prior to the transfer and we had to get a written exemption for one of them from the seller. Presumably the covenant in question goes back to before your ownership and has travelled up the chain so to speak?

[lizzie]

@JSHarris so sorry to hear this.  I think you said it was a religious organisation of some sort buying I think.  Maybe they wanted to use it for 'business' and the covenant prohibits.

 

Covenants are not on searches they are attached to your title. Your solicitor should be able to send you a copy.  There may be more than one 'restrictive covenant'.

 

Hopefully your back up buyers are still around.

[lizzie]

@bissoejosh A covenant is there for ever unless it has an expiry date built in.  Where they are historic and the beneficiary of the covenant or their successors in title cannot be found then there is a procedure to insure against the covenant being exercised.  Solicitors are well used to this scenario.  The only person who can release a covenant fully is the beneficiary or their successors in title of that covenant. 

[newhome]

On 11/08/2018 at 10:06, PeterW said:

Downside is when the buyers solicitor won’t accept the searches and insists on doing their own... had this happen to friends who needed to move quickly and put their house up for auction. Had an offer of a decent amount 2 weeks before the auction and passed the pack to buyers solicitor as they had accepted the offer.  Week after the auction date and the solicitor decided he didn’t like the contract wording and wanted to restart the process and quoted 8-10 weeks to completion.... you can guess the rest !!

 

I guess in this sort of scenario it would be prudent to say exchange before the auction date.  One of those things you live and learn I imagine. 

[Jeremy Harris]

We're good friends with the successors in title to any covenants on our place, as they are our neighbours.  The house next door is the old manor farm that dates back a couple of hundred years or so, and back in 1980 they sold off the land our house has been built on.  I'm pretty sure that it's only the owners of that house that can have inherited any rights, as I know a fair bit of the history of the village, from the time when I was helping with the neighbourhood plan.

 

One option, once I know what the covenants are, may be to see if the successors in title would be prepared to remove or amend the restrictions.  That may well be possible, as the neighbour owes me a big favour - relating to support for a planning application he put in recently.

[lizzie]

2 minutes ago, JSHarris said:

We're good friends with the successors in title to any covenants on our place, as they are our neighbours.  The house next door is the old manor farm that dates back a couple of hundred years or so, and back in 1980 they sold off the land our house has been built on.  I'm pretty sure that it's only the owners of that house that can have inherited any rights, as I know a fair bit of the history of the village, from the time when I was helping with the neighbourhood plan.

 

One option, once I know what the covenants are, may be to see if the successors in title would be prepared to remove or amend the restrictions.  That may well be possible, as the neighbour owes me a big favour - relating to support for a planning application he put in recently.

That sounds very positive Jeremy.  Good luck.  If you have your title docs from your bank you should be able to find it there.  Some years back the Land Registry did away with 'title deeds' and now just issue a certificate and that has all the extracts on it.  Its no substitute for the actual deeds especially historic ones and if you have those they are worth keeping and handing on to a purchaser.  In your bank bundle you hopefully will have a document named Epitome of Title which is is the tree and gives the root of your title.  You can trace from that.  If your covenants are so recent it should be easy to spot.

[newhome]

Sorry to hear this Jeremy. I hope that it can be resolved. Personally I think it’s nonsensical that covenants can be added to property or land that someone is selling. Selling should mean relinquishing the rights to that land in my view unless it relates to an existing access or similar. Change of use, pets, caravans, trailers etc should be none of anyone’s business as long as they are lawful eg have planning permission etc. 

[AliMcLeod]

59 minutes ago, JSHarris said:

Anyone know for sure how to get hold of covenants?  AFAICS, just paying the fee and getting another copy of the Land Registry stuff probably won't reveal them, as it didn't when we bought the house, it seems.

 

Shouldn't your solicitor be telling you what their issue is? 

Edited August 13, 2018 by AliMcLeod

[Jeremy Harris]

22 minutes ago, lizzie said:

That sounds very positive Jeremy.  Good luck.  If you have your title docs from your bank you should be able to find it there.  Some years back the Land Registry did away with 'title deeds' and now just issue a certificate and that has all the extracts on it.  Its no substitute for the actual deeds especially historic ones and if you have those they are worth keeping and handing on to a purchaser.  In your bank bundle you hopefully will have a document named Epitome of Title which is is the tree and gives the root of your title.  You can trace from that.  If your covenants are so recent it should be easy to spot.

 

There are no covenants listed in any of the documents we got back from the bank, including the Land Registry Title - that has no mention of any covenants.  We don't have a copy of the original deed of sale from c.1980, presumably that got lost when the land was registered on transfer of ownership.  We know of three owners previous to us buying the house in 2000, so my guess is that the original deeds got thrown out a fair time ago, when the land was registered for the first time, probably.

 

Checking the Land Registry info it seems that covenants are not always included in the title, but may well be held separately by them.  To find this out I have to complete a deeds request and cough up £7 for each document they find - it seems that the only title download may well not show some of the info.  Right now I'm trying to get hold of the docs via our conveyancer, plus I've asked the agent if he can try and get a copy from the purchaser, just in case they've found out something different.

 

15 minutes ago, AliMcLeod said:

 

Shouldn't your solicitor be telling you what their issue is? 

 

I've asked and am awaiting a response - past experience tells me that they are not quick to respond...

 

My plan is to look at the covenants when I get them, try and guess which restrictions may be causing the religious trust problems (they are pretty secretive about what they will reveal to non-brethren, it seems) and then see if I can get those covenants lifted by talking to my neighbour.  Knowing the neighbour, and the fact that our house is around 60m away from theirs, I doubt they would have problems with lifting any really daft restrictions.  Their house is dead opposite the parish church (as in 20m away from it), and I believe the family that built the old manor farm house may also have built the church.  If so, then there may well be a possibility that there is some sort of restrictive covenant regarding places of worship, perhaps, and that may be why the trust has pulled out (I believe that they hold prayer meetings informally, and perhaps in each other's houses).

[HerbJ]

1 hour ago, JSHarris said:

All they are saying is that their solicitor found a restrictive covenant and that he has advised them that there is no way around it for what they wish to do.

 Just request a copy of the restrictive covenant from the buyer's solicitor on which they are relying for their advice to your seller.

[Jeremy Harris]

Just got hold of the three restrictive covenants, all of which relate to the sale of the land in 1981, just before our house was built.  They don't seem too onerous to me, and there's a good chance that our neighbour might agree to lift at least two of them (he'd probably not want to lift the dormer window one).  These are the only covenants that have been found (not sure why we didn't already have a copy of these):

 

The owner of the property from time to time shall not:

 

1.     Erect on the land any building other than one single storey dwelling house and single storey outbuildings appurtenant thereto

 

2.     Use the property for any purpose other than as a single private dwelling house

 

3.     Not construct in the roof of the property any dormer window which faces to the north west.

 

[AliMcLeod]

7 minutes ago, JSHarris said:

Use the property for any purpose other than as a single private dwelling house

 

I suspect you're correct and this is the issue that has halted the church's interest in your house. Despite the covenant owners "owing you one" do you really think they'd just remove this covenant outright, with the risks that entails? I think it more likely that they'd be open to relaxing the covenant and replacing it with something less onerous, but then you'd have to know the intentions of the proposed purchasers.

 

Or perhaps they want to build another outbuilding (covenant 1) - is there room to do that?

Edited August 13, 2018 by AliMcLeod

[Mr Punter]

It is often fairly simple to obtain insurance against the enforcement of covenants, chancel repair liabilities etc. and the premium should not be large.

[newhome]

3 minutes ago, Mr Punter said:

It is often fairly simple to obtain insurance against the enforcement of covenants, chancel repair liabilities etc. and the premium should not be large.

 

But surely if the new owners intend to use the house for business purposes from the get go it wouldn’t be easy to take out such an insurance? Surely you insure for something that may happen, not that you know has already happened or you have been told is intended to happen? 

 

 

[Jeremy Harris]

7 minutes ago, AliMcLeod said:

 

I suspect you're correct and this is the issue that has halted the church's interest in your house. Despite the covenant owners "owing you one" do you really think they'd just remove this covenant outright, with the risks that entails? I think it more likely that they'd be open to relaxing the covenant and replacing it with something less onerous, but then you'd have to know the intentions of the proposed purchasers.

 

Or perhaps they want to build another outbuilding (covenant 1) - is there room to do that?

 

I suspect it may well be the "use only as a single dwelling house" covenant that is the problem - not sure what the neighbour would think about lifting it, but it has to be worth asking.

 

There's no room on the plot for another outbuilding at all; the plot's already pretty small, so I doubt that's the problem.

 

9 minutes ago, Mr Punter said:

It is often fairly simple to obtain insurance against the enforcement of covenants, chancel repair liabilities etc. and the premium should not be large.

 

As @newhome says, I doubt you can insure against something you know you're going to do. 

 

I need to find out which of the three covenants is the show stopper for them, and then talk to the neighbour.

[lizzie]

It will be number 2 and this is a standard covenant. Insurance not suitable in this case.  Your religious ppl probably looking at some sort of place of worship or school.

This covenant is a positive to most purchasers as they would not want to find themselves next to a ‘business’ in a residential development. The covenant will  be on all the properties built there.

 

I would just move on to the next in line. It wont be an issue. Just your unusual prospective purchasers. One in million chance very frustrating for you.

[Jeremy Harris]

1 minute ago, lizzie said:

It will be number 2 and this is a standard covenant. Insurance not suitable in this case.  Your religious ppl probably looking at some sort of place of worship or school.

This covenant is a positive to most purchasers as they would not want to find themselves next to a ‘business’ in a residential development. The covenant will  be on all the properties built there.

 

I would just move on to the next in line. It wont be an issue. Just your unusual prospective purchasers. One in million chance very frustrating for you.

 

I agree that this seems to be a very common covenant; I'm pretty sure I've seen it on some of the other houses we've bought over the years.  As you say, it rarely causes a problem for most buyers.  It's such a common covenant that I would have thought that the purchaser would have guessed it might be there, or at least thought to ask during one of their visits before they made their formal offer.  I had all the house documents out on the dining room table for them to look at, including the Land Registry info, but they weren't interested in looking at it.

 

That, and something our agent said on the phone about them often buying up properties, collectively as a trust, doing them up and then selling or renting them to other brethren, makes me think that either the first or last covenant might be the issue.

 

Hopefully I may find out later today, as I've raised the point about me asking the neighbour about lifting the covenants that are preventing them purchasing.

[ProDave]

I agree it's the covenant restricting it to a dwellinghouse that will be the one that bothers them.  Any other buyer planning to live in it would not be concerned by that.

 

I take it you are going to try and get that extinguished if you can?

[Jeremy Harris]

5 minutes ago, ProDave said:

I agree it's the covenant restricting it to a dwellinghouse that will be the one that bothers them.  Any other buyer planning to live in it would not be concerned by that.

 

I take it you are going to try and get that extinguished if you can?

 

It can't hurt to ask, as we are well away from their house, plus there's a 12ft high hedge along our boundary with them, so they can't see our place at all from where they are.  They never use the bit of land that's between the boundary and their driveway; it's like a small paddock, with a few trees growing on it.

[Jeremy Harris]

Just been going back through the negotiations and it looks very much as if the trust intended to purchase the house as a dwelling.  This is the wording at the end of their off:

 

Quote

As a small local trust that helps to support both young and old with housing requirements we see this as a fantastic property with great facilities.

 

That makes me think that it's either covenant clause 1 or 3 that may be the problem, or possibly that they want to use the house as an HMO, which may well infringe covenant clause 2.

 

Either way it looks worth trying to see if I can work something out with our neighbour, rather than just let the deal fall through and pick up one of the other potential buyers, especially as any potential buyer is going to want to know why the initial purchase fell through.

[AliMcLeod]

1 hour ago, ProDave said:

I take it you are going to try and get that extinguished if you can?

 

If i were them, there's no way I'd agree to have such a covenant removed carte blanche - I'd want it replaced with something specific as to the new intended use. Remove it completely and the church could sell 6 months down the line to someone mending cars in their back yard, with the resultant eye-sore/noise/smell.

 

And I'd want the legal work to have the covenant changed done so at the sellers cost.

 

Its definitely worth asking the question, but i'd also be ready to reach out to the other people who put in an offer.

Edited August 13, 2018 by AliMcLeod