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Court of Appeal Success in Bath Rugby Ltd v Greenwood & Ors v Bath Recreation Ltd [2021] EWCA Civ 1927

Clarke Willmott acted successfully in the Court of Appeal relating to a covenant concerning the Rec in Bath which houses the Bath Rugby Stadium, a sports centre and playing fields which host local events including the Bath Half Marathon.

We acted for Bath Recreation Limited (the freeholder of the Rec) as a co-appellant with Bath Rugby Limited (the tenant of the stadium).

Background

Bath Rugby Limited has a lease of land on the Rec which houses its famous rugby stadium in central Bath. In a previous High Court claim Bath Rugby sought declarations (pursuant to section 84(2) of the Law of Property Act 1925) that the land was free from a covenant imposed in a conveyance dated 6 April 1922. The 1922 covenant sought to restrict certain activities on the Rec “which may be or grow to be a nuisance and annoyance or disturbance or otherwise prejudicially affect the adjoining premises or the neighbourhood…”

Certain residents objected and the matter went to trial in 2020 (Bath Rugby Ltd v Greenwood and Others [2020] EWHC 2662 (Ch)).

Legal Principles

The background law is that for the benefit of this 1922 covenant to be annexed to land and therefore enforceable, it must be taken for the protection of defined land. The main question was whether the words “adjoining premises or the neighbourhood” sufficiently identified the land to which the benefit of the covenant was intended to be annexed.

Decision on Appeal

The High Court found that the covenant was enforceable so Bath Rugby Limited appealed, and our client Bath Recreation Limited successfully applied to join that appeal.

The appeal was successful and the Court of Appeal held that the covenant is not enforceable.

There needed to be a ‘sufficient indication’ of the land intended to be benefited by the covenant. Nugee LJ described “Neighbourhood” as “an inherently imprecise term” and concluded “it is not a conveyancing expression. “Neighbourhood” does not refer to any particular properties at all. It refers to a local area. It is a singularly inapt expression to use to identify properties to which the benefit of a covenant is intended to be annexed”. He concluded “it is not even theoretically possible to draw up a list of properties in a neighbourhood”.

There was another interesting discussion in the judgment. Two of the Lord Justices considered that not only must the land to be benefitted by the covenant be identifiable but that it should be “easily ascertainable” from the conveyance itself rather than from an examination of extrinsic evidence.

Points to note:

  1. The case highlights the need to clearly identify land which is to take the benefit of a restrictive covenant. A good description and plan are advisable. Definition of the benefit being to a neighbourhood is not advisable!
  2. Further given the view of 2 of the 3 Lord Justices in the case it is advisable that the land taking the benefit of the covenant should also be “easily ascertainable” on the face of the document.

The case establishes an important and wide reaching legal principle. It enables Bath Rugby to continue with their plans to redevelop their stadium in this historic city centre, as well as allowing the Rec to continue to be used as an open space for recreational purposes such as the Bath Half Marathon.

Clarke Willmott LLP acted for Bath Recreation Limited (contact Graham McIntyre and Beverley Pike). Counsel for Bath Recreation Limited were Martin Hutchings QC and Harriet Holmes of Wilberforce Chambers.

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