By Sophie Price
|Published 29 June 2026
The recent decision in Butler v Flagship Housing Group [2026] UKUT 182 (LC) is a useful reminder that even where a proposed development has planning consent, the Tribunal may refuse to discharge or modify covenants which prevent that development if they still provide practical benefits to those entitled to enforce them, particularly where the covenants are recent.
Facts
The case concerned a block of six lock-up garages bought at auction in 2023. The transfer contained restrictive covenants which, in broad terms, prevented development and limited the use of the site to garages. Outline planning permission to demolish the garages and build a bungalow was obtained. The covenants prevented that development, so having subsequently acquired the land from a company he owned and controlled, Mr Butler applied to the Upper Tribunal under section 84 of the Law of Property Act 1925 (LPA) to have the covenants discharged or modified.
Mr Butler relied on section 84(1)(aa) of the LPA, arguing that the covenants impeded a reasonable use of the land and did not secure practical benefits of substantial value or advantage and section 84(1)(c), arguing that modification would not injure those entitled to the benefit of the covenants. The Tribunal accepted that the proposed use was reasonable because planning permission had been granted and it was common ground that the covenants impeded that use. The central issue was whether the covenants still provided practical benefits to the beneficiary (Flagship).
The Tribunal found that they did. The covenants helped Flagship manage its estate and protect the amenity of surrounding homes, including reducing the risk of overlooking and disturbance. This also meant that the separate ground, based on absence of injury, was not made out and the Tribunal dismissed the application.
Timing was significant. The covenants had been imposed less than three years earlier, when the applicant’s company acquired the site. Even if the statutory grounds had been made out, the Tribunal indicated that it would not have exercised its discretion since the applicant was closely connected with the original purchaser and was seeking to modify restrictions that had formed part of a recent bargain.
For developers, investors and landowners, the key message is to treat restrictive covenants as a front-end due diligence issue, not as a problem to be solved after planning has been obtained. Planning permission and covenant enforceability are separate questions. A site may be acceptable in planning terms but still be blocked by enforceable restrictive covenants, particularly where those covenants are recent.
Where a covenant is recent, and particularly where the applicant or its connected entity took the land with knowledge of the covenants, an application under section 84 may face an uphill struggle.
In practical terms, parties should identify restrictive covenants early, assess who can enforce them, consider whether consent or a release can be negotiated, and build the timing and cost of that process into the development strategy.
Butler v Flagship Housing Group [2026] UKUT 182 (LC)
