Alexander Devine Children's Cancer Trust v Housing Solutions Ltd [2020] UKSC 45
Alexander Devine Children's Cancer Trust v Housing Solutions Ltd is the leading Supreme Court decision on modifying restrictive covenants under section 84 of the Law of Property Act 1925 after a developer has built in deliberate breach.
Facts
Millgate Developments built 13 affordable homes on land subject to restrictive covenants prohibiting building and requiring the land to remain available for parking. The covenants benefited neighbouring land intended for a children's cancer hospice. Millgate knew of the restrictions before construction but proceeded in order to satisfy the affordable-housing requirement for a larger development. Only after the homes had been built did it apply to the Upper Tribunal under section 84 of the Law of Property Act 1925 to modify the covenants. The Tribunal granted modification and compensation, relying on the public interest in using the completed homes. The Court of Appeal reversed that decision, and Housing Solutions, which had acquired the housing, appealed.
Legal Issue
How should the public-interest ground and statutory discretion under section 84 be applied when a developer knowingly builds first and seeks modification of restrictive covenants afterwards?
Held
The Supreme Court dismissed the appeal and remade the decision by refusing modification. The public-interest condition under section 84(1)(aa) was assessed at the hearing, so the completed but unusable affordable homes could be considered. The Upper Tribunal nevertheless erred when exercising its discretion because it omitted two material consequences of Millgate's conduct. Millgate could have built the affordable homes on unencumbered land, avoiding conflict with the Trust's rights, and its deliberate breach transformed its prospects of satisfying the public-interest condition by creating a fait accompli. Had those matters been considered, the application would have been refused. The Supreme Court did not decide what remedy should follow in separate enforcement proceedings.
⭐ Legal Principle
Even where a restrictive covenant impedes a reasonable use and the statutory public-interest condition is satisfied, modification under section 84 remains discretionary. A deliberate developer who could have applied before building cannot expect to improve its position by creating the very public-interest problem on which it later relies.
Significance
This was the Supreme Court's first decision on section 84 and it strongly discourages strategic breach of restrictive covenants. It separates the jurisdictional grounds for modification from the Tribunal's discretion after a ground is established. Deliberate conduct is not an automatic bar, but it may weigh heavily where the applicant could have sought advance determination and avoided the conflict. The case also shows that planning permission does not override private property rights. Developers must investigate covenants early and apply before construction, while beneficiaries should identify the practical value that the restriction protects.
Common exam questions about this case
Did Millgate's deliberate breach prevent the statutory ground from being established?
Not automatically. The Supreme Court accepted that the public-interest question under section 84(1)(aa) is assessed at the hearing, when the affordable homes already existed. Millgate's conduct was most important at the later discretionary stage. Even after jurisdiction was established, the Tribunal had to decide whether modification should be granted and should have given decisive weight to how the dilemma was created.
Why did the Supreme Court refuse to modify the restrictive covenants?
Millgate knew about the covenants, could have applied for modification before building and had access to other land on which the affordable housing requirement could have been met. It nevertheless completed the homes and relied on the resulting public interest in their occupation. Allowing that strategy would reward a developer for manufacturing a fait accompli and would undermine orderly use of section 84.
Does planning permission remove or override a restrictive covenant?
No. Planning control and private covenants perform different functions. Permission may make development lawful in public planning terms, but a beneficiary can still enforce a private restriction unless it is released, discharged or modified through a lawful route such as section 84. A developer must therefore investigate both systems and should not assume that planning approval gives a complete right to build.