Property Law Question & Answer

Question : Property Law

I am a private house owner in a mid-terraced house in a road with mainly private houses, some tenanted old peoples bungalows and some flats. The house was previously a tenanted property owned by xxxxxx Housing Association (xxx) but was sold freehold in 1992.

I purchased the house in 2006 and immediately received a bill from xxx for maintenance of the land surrounding the houses in the street and fixing of xxx signs etc. This bill has increased by 100% this year to £160. I have been told by xxx staff that there is a deed of covenant on the property and that I must pay this bill. I am not happy with this and want the deed cancelled. I do not think that I should be paying for the upkeep of communal land which would otherwise be maintainable by the council.

How do I get the deed of covenant cancelled? The deed is worded as follows: HM Land Registry (under the right to buy provisions of the Housing Act 1985) TRANSFER OF PART. It then contains subsections of waffle that apparently means I am liable to contribute to their tenants bills!

Answer : Property Law

I am asked to advise Mr. X (the Petitioner) with regard to the express terms of a Covenant written into a Deed of Transfer pertaining to the property (the property) known as xxxx, Basingstoke, Hampshire. Title Number xxxxxxxx.

It should be noted that the document supplied by the Petitioner with regard to his enquiry cites a name separate and other than that of the Petitioner.

The Petitioner states that the property is a mid terraced private dwelling house previously owned and tenanted by xxxxxxx Housing Association (xxx). The property was sold freehold in xxxx in what appears to be a sitting tenants Right to Buy scheme by Ms Jennifer xxxxxx xxxxx.

The property was purchased by the Petitioner in 2006. Upon purchase the Petitioner received a bill from xxx for maintenance of the land surrounding the houses in the street and the fixing of xxx signs etc. The Petitioner further states that this presumably annual bill from xxx has increased by 100% to £160.00 this year.

The Petitioner states that he feels this sum to excessive and arbitrary and requests clarification over his legal position and liability with regard to complete withdrawal from the Covenant and /or part payment.

A Covenant is simply a promise made in a deed. A contract between two consenting parties. The document supplied establishes a covenant between xxx and Ms xxxxx not xxx and the Petitioner.

However for the purpose of this advice attention is drawn to paragraph 4 of the document.
THE Purchaser hereby covenant with the Society for the benefit of the Society's said Estate and every part thereof that she the purchaser will at all times hereafter observe and perform the stipulations set out in the First Schedule hereto.

Attention is then drawn to paragraph 5 of the First Schedule
At all times hereafter to contribute and pay an appropriate annual proportion (as exclusively determined by the Society's auditor) of the Society's expenses in connection with maintaining and repairing and renewing all communal parts of the Society's said Estate such payment to be made to the Society within 28 days of the Society giving notice in writing...

The Signee of this document has contracted with xxx to pay an annual sum, such sum to be determined at the discretion of the auditors of xxx (which shall likely be an outside agency) toward the upkeep of the estate in which the property is located.

Any non payment or part payment therefore constitutes breach of contract and the person(s) suffering that breach, here xxx, are entitled to seek remedy by way of damages or censure in a Court action.

The Petitioner can, of course, choose to test the appropriate annual proportion term contained within paragraph 5 of the First Schedule by submission to the County Court for a ruling.

However, should the Petitioner not be a party to such a document i.e. he did not sign a like document upon purchase of the property, he is not party to any such Covenant and may refuse payment.

FOLLOWING RECEIPT OF DOCUMENTS
The Petitioners attention is further drawn to paragraph 6 of the First Schedule. This clearly states that any successor owners in title of the property known as xxx xxxxx xxxxxx following on from Ms Jennifer xxxxx must agree with the previous owner to enter into the said Deed of Covenant.

In plain terms, a stated condition of purchasing the property was that you agree with the stipulations as set out in the Deed Of Covenant including paragraph 5 which again clearly states its terms (see above).

Paragraph 7 sets a window of notice of 1 month for a transferee (the petitioner) to comply.
The Petitioner duly signed the Deed Of Covenant thereby entering into a contract. Any breach of this contract which will include non or part payment of sums as described in paragraph 5 of the First Schedule will leave the Petitioner liable in a Civil action brought by xxx. Such liability will likely involve full payment of the original demand and any interest applicable plus costs.

However such disputes between home owners and private estate management companies are not uncommon. Previously such disputes have been resolved by individual home owners banding together to present a collective submission to a District Judge at County Court. If such a submission where to demonstrate the sums requested by xxx were unreasonable for the service provided, previous rulings have charged the applicants making the submission to form their own Residents Management Committee, responsible for the upkeep of an estate.

To conclude it is very unlikely the Court will allow you to unilaterally alter the terms and conditions of signed contract (The Deed) without evidence of some malpractice on behalf of xxx.

The Council cannot be named in any action as they are not a party to the Deed of Covenant and the residence is located upon a private estate. Remedy may be sought however by a collective submission and counter proposal by you and your co residents.

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