UPPER TRIBUNAL (LANDS CHAMBER)

	
UT Neutral citation number: [2015] UKUT 0082 (LC)
UTLC Case Number: LP/14/2013	

TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007

RESTRICTIVE COVENANT – discharge – estate comprising 278 holiday bungalows – occupation restriction on 74 days of the year – applicant seeking discharge to allow all year round occupation and removal of holiday use restriction - obsolescence – practical benefits of substantial value or advantage – public interest – injury – application refused – objector’s suggested modification allowed - Law of Property Act 1925 s 84(1)(a), (aa), (b) and (c) 

	IN THE MATTER OF AN APPLICATION UNDER SECTION 84 OF THE
LAW OF PROPERTY ACT 1925

BY

	ROLAND STAFFORD-FLOWERS	Applicant

re: 182 Brambles Chine Estate, Monks Lane, Freshwater,
Isle of Wight PO40 9SU

	Before: P R Francis FRICS
	 
Sitting at: Isle of Wight Combined Court, 1 Quay Street, Newport, IOW PO30 5YT
on
7 & 8 October 2014

Stephen Cottle, instructed by South West Law, solicitors of Bristol, for the applicant
Stephen Jones, instructed by Scott Bailey LLP, solicitors of Lymington, for the objectors 

The following cases are referred to in this decision:

Re Bass Ltd’s Application (1973) 26 P&CR 156
Shephard v Turner [2006] 2 P&CR 28  
Mills v Cooper [1967] 2 QB 459
Re Truman Hanbury Buxton& Co Ltd [1956] 1 QB 261 
Re Snaith and Dolding (1995) 71 P & CR 104

The following case was also referred to in argument:

Caradon DC v Paton (2000) 33 HLR 60

DECISION
Introduction
1.	This decision relates to an application made on 3 June 2013 by Roland “Ron” Stafford-Flowers for the discharge of a restrictive covenant burdening a bungalow at 182 Brambles Chine Estate, Monks Lane, Freshwater, Isle of Wight PO40 9SU (the application land) under section 84(1)(a), (aa), (b) and (c) of the Law of Property Act 1925 (the 1925 Act).   He acquired the freehold absolute in the application land in 1998 under Title No: IW 3636.  The conveyance included ten restrictive covenants, the relevant one stating:
“Not to use the land or the bungalow other than as a holiday bungalow for leisure purposes only and not to occupy or allow the bungalow to be occupied during the periods from 15th November to 19th December and from 4th January to 14th February in any year.”     
2.	The objector, Linstone Chine Management Company Ltd (referred to hereafter as LCMC or the Company), is the management company for the Brambles Chine Estate and the adjacent Cliff End Estate. 
3.	Mr Stephen Cottle of counsel appeared for the applicant who he called together with his wife, Mrs Pamela Stafford, each of whom had produced witness statements of fact. He also called seven of the 18 further witnesses who had provided statements in support of the application, together with Mr David Timothy Mark Rhodes FRICS of Hose, Rhodes Dickson, Chartered Surveyors of Newport IOW, who gave expert evidence.
4.	Mr Stephen Jones of counsel appeared for the objector and called Mr Nicholas James Hawkins, General Manager of LCMC and Mr Glen Hepburn MRTPI of Hepburn’s Planning Consultancy Ltd who gave expert planning evidence, together with two of a total of 6 witnesses of fact who had each provided statements in support of the objection.  
5.	Closing submissions in writing, for which I am grateful, were made following the hearing, the last of these being received by 5 November 2014. I made an accompanied site inspection of the application land and the site in general on 6 October 2014.   
6.	It had been suggested in the applicant’s statement of case that the Tribunal should consider the restriction in two parts.  Firstly, the reference to the application land being used as a holiday bungalow for leisure purposes only and, secondly, the restrictions on occupation.  As to the second part, that should be further divided into the question of prohibition of occupation in the daytime, and the prohibition of occupation overnight during the restricted periods, because LCMC had never had any objection to daytime occupation.  During the second day of the hearing, the objector conceded (through the Estate Manager, Mr Hawkins) that it had tacitly accepted the principle of owner/occupation for all but 74 nights of the year whether or not strictly for holiday purposes, and that following debate the members of the Company had defined occupation as meaning sleeping in the covenanted properties overnight.  However, LCMC remained adamant that night-time occupation should continue to be prohibited in order to, as submitted in closing, “… preserve the character of the site as providing temporary, peaceful, second-home, leisure based accommodation.”     
7.	LCMC therefore suggested a modification to the restriction along the following lines:
“Not to occupy or allow the bungalow to be occupied between 5pm and 10am on any day during the periods from 15th November to 19th December and 4th January to 14th February in any one year.”
Although the revised wording failed to make specific reference to the holiday/leisure use of the application land, it was clear from the evidence (and particularly that of Mr Hawkins) that that part of the restriction was not being defended, and it was thus only the sleeping overnight part that remained in issue.   Indeed, in closing, Mr Jones said that given the objector’s concession, the Tribunal was left to decide the application in relation to the discharge of the overnight occupation restriction only.  
8.	Whilst this was an application for discharge, and a modification was not sought by the applicant in the alternative, the Tribunal does nevertheless have discretion both to modify and, under section 84(1C) of the Act, to add further provisions restricting the use. 
Facts
9.	The parties produced a brief statement of agreed facts principally referring to the parts of the applicant’s and objector’s statements of case that were agreed.  From this, together with the evidence that was before me and from my site inspection, I find the following facts. 
10.	Brambles Chine Estate and the adjacent Cliff End Estate (collectively known as Linstone Chine) between them occupy approximately 38 acres of cliff-top parkland at the western end of the Isle of Wight, about 1 mile north of Freshwater.  It is approached over a section of unmade and unadopted road known as Monks Lane which lies off the main A3054 running from Newport to Freshwater via Yarmouth. 
11.	 Planning permission was granted on 14 March 1974 for a proposed scheme of 278 single storey self-catering units on the land subject to conditions, the relevant one for these purposes providing:
“This permission shall not authorise the use of the land for chalets except during the period from 15 February to 15 November and a further fortnight at Christmas in each year. 
REASON: To ensure that the site is maintained in a proper manner”
12.	Brambles Chine, upon which the application land is situated, was developed first in the late 1970s with Cliff Top Chine following in the early 1980s.  
13.	 The application land is the westernmost of a pair of semi-detached units located at the far, western end of one of the estates’ spur roads.  It occupies a truly cliff-top position within a matter of feet from the cliff edge overlooking Colwell Bay, and has commanding views of the Solent towards Hurst Point and Hurst Castle.  It is described as a typical holiday chalet and is constructed of cavity brickwork under a flat, asphalted roof. The accommodation comprises living room, kitchen, two bedrooms and a bathroom.  There is a small paved patio to the rear. 
14.	LCMC is the management company for the whole of Linstone Chine, and its shareholder members are made up exclusively of the owners of freehold chalets (except Nos.241 and 242 Brambles Chine).  Those freeholds, which have been acquired by the occupiers over the years, consist solely of the footprint of the individual chalets.  LCMC retain the freehold of all the common parts (including the patio areas immediately behind each of the properties), grassed areas, parkland, driveways and the former club premises, former swimming pool, shop, launderette and office at the entrance of Brambles Chine.
15.	The applicant first came to the Brambles Chine Estate in 1996 when he commenced working in the site shop (which he no longer does).  His sister already owned a chalet on the development. When number 182 Brambles Chine Estate came onto the market, it was purchased for the applicant and his wife by his sister in 1998, and Mr Stafford-Flowers and Mrs Stafford have lived there ever since as their main and only residence. The purchase was subject to ten restrictions set out in an original conveyance dated 13 June 1983 between (1) Linstone Chine Management Company Limited and (2) Beryl Mogg and Alan Mogg.  
16.	It is agreed that the applicant and his wife are in breach of all elements of the restriction (set out in paragraph 1 above) as they occupy the property all year round.   LCMC brought proceedings in the County Court for an injunction to prevent the applicant and his wife (along with the owner of the adjoining property, 180 Brambles Chine) from occupying the application land or N0. 180 during the restricted periods, but for the purpose of those proceedings did not seek to enforce the section of the covenant restricting use of the property to a holiday bungalow for leisure purposes only.  That, it was said by the objector, was because it would have been very difficult to establish to what degree occupation “amounted to an extended holiday break or occupation for 10 months of the year or more.”  However, that fact did not amount to a concession that that part of the covenant was unenforceable or obsolete. 
17.	Those proceedings came before Newport County Court on 5-7 October 2011 and the injunction was granted in a judgment handed down on 25 January 2012, with costs awarded against the defendants.  The injunction was stated to have effect from 15 November 2012 to give the defendants time to make alternative accommodation arrangements.  At paragraph 56 of the judgment, Recorder Belben said:
“I have decided that it would not be unconscionable to grant an injunction and for the following reasons.  Each defendant bought their respective chalets in the knowledge that Restrictive Covenants existed preventing their occupation during the winter months.  That each defendant from a very early stage decided to defy that Covenant fairly openly.  Each defendant knew that their conduct was unacceptable to Linstones and to a majority of its members.  Each defendant knew that the resources of Linstones were very limited, and that any legal action would be expensive.  Each defendant acknowledged that at no time were they misled into believing that their conduct had become acceptable although previously it was not... In my judgement there was no evidence before me to conclude that the character of the site had so fundamentally changed over the years that to grant an injunction now would be redundant...”    
18.	  The judge went on to conclude that if an injunction was not granted, the fear of the majority of the members of LCMC was well founded – namely that over the course of time the character of Linstone Chine would change.  The court was also satisfied that the nature of the site and the chalets erected thereon was not that of permanent living accommodation, and that if it became a site where properties were permanently occupied it would quickly deteriorate.   In the light of the application to this Tribunal, Recorder Belben has stayed the enforcement of the injunction in respect of the application land pending the Tribunal’s determination. 
19.	On 29 March 2012, Isle of Wight Council, being satisfied that for a period of at least ten years, the applicant as owner of 182 Brambles Chine and the owner of the adjoining property, 180 Brambles Chine, had occupied their properties continuously in breach of planning permission TCP/00823/T, granted a Certificate of Existing Lawful Use or Development in accordance with section 191 of the Town and Country Planning Act 1990.  
Statutory Provision 
20.	The grounds upon which the application was made were those set out in section 84(1)(a) (aa) (b) and (c) of the 1925 Act (as amended) which provide:
“84(1)	The Upper Tribunal shall (without prejudice to any concurrent jurisdiction of the court) have power from time to time, on the application of any person interested in any freehold land affected by any restriction arising under covenant or otherwise as to the user thereof or the building thereon, by order wholly or partially to discharge or modify any such restriction on being satisfied-
	(a)	that by reason of changes in the character of the property or the neighbourhood or other circumstances of the case which the Upper Tribunal may deem material, the restriction ought to be deemed obsolete; or 
	(aa)	that in a case falling within subsection (1A) below) the continued existence thereof would impede some reasonable user of the land for public or private purposes or, as the case may be, would unless modified so impede such user; or 
	(b)	that the persons of full age and capacity for the time being or from time to time entitled to the benefit of the restriction, whether in respect of estates in fee simple or any lesser estates or interests in the property to the benefit of the restriction is annexed, have agreed, either expressly or by implication, by their acts or omissions, to the same being discharged or modified; or       
	(c)	that the proposed discharge or modification will not injure the persons entitled to the benefit of the restriction.
and an order discharging or modifying a restriction under this subsection may direct the applicant to pay to any person entitled to the benefit of the restriction such sum by way of consideration as the Tribunal may think it just to award under one, but not both, of the following heads, that is to say either –
	(i)	a sum to make up for the loss or disadvantage suffered by that person in consequence of the discharge or modification; or
	(ii)	a sum to make up for any effect which the restriction had, at the time, when it was imposed, in reducing the consideration then received for the land affected by it.
(1A)	Subsection (1)(aa) above authorises the discharge or modification of a restriction by reference to its impeding some reasonable user of the land in any case in which the Upper Tribunal is satisfied that the restriction, in impeding that user, either – 
	(a)	does not secure to persons entitled to the benefit of it any practical benefits of substantial value or advantage to them; or
	(b)	is contrary to the public interest;	
and that money will be an adequate compensation for the loss or disadvantage (if any) which any such person will suffer from the discharge or modification.
(1B)	In determining whether a case falling within section (1A) above, and in determining whether (in any such case or otherwise) a restriction ought to be discharged or modified, the Upper Tribunal shall take into account the development plan and any declared or ascertainable pattern for the grant or refusal of planning permissions in the relevant areas, as well as the period at which and context in which the restriction was created or imposed and any other material circumstances.
(1C)	It is hereby declared that the power conferred by this section to modify a restriction includes power to add such further provisions restricting the user of the building on the land affected as appear to the Upper Tribunal to be reasonable in view of the relaxation of the existing provisions, and as may be accepted by the applicant; and the Upper Tribunal may accordingly refuse to modify the restriction without some such addition.” 
21.	Reliance on ground (b) – express or implied agreement to the discharge (or modification) was abandoned by Mr Cottle in opening the applicant’s case.  
The case for the applicant
22.	It was argued for the applicant that when planning permission was originally obtained for the development in 1974, that consent effectively constituted a change of use from former agricultural land to residential.  The only way that change of use could be justified in such a location was in the interests of promoting tourism to the island, hence the application being for “self-catering units” and the permission containing a condition restricting dates of occupation.  In this regard, the Tribunal was referred to the judgment in Caradon DC v Paton (2000) 33 HLR 60) which dealt with the difference between owner-occupier and holiday use.  Any breach of the planning condition by occupying the property as a sole or main residence throughout the year would make an owner vulnerable to planning enforcement action.
23.	When the estate was all in single ownership the landowner would obviously have had control over how the properties were occupied, but when the decision was made to sell off the freeholds to most of the units, it was necessary to put the restriction on a contractual footing in order to ensure that the purchaser continued to meet the obligation to comply with the planning condition.  Thus, the Tribunal was invited to find that that was the reason for the inclusion of the restrictive covenant.
24.	There had also been, it was argued, a material change of circumstances in that whereas the former estate owner had offered the units for use by holidaymakers, when the freeholds went into individual ownership they increasingly became owner occupied.  Furthermore, stiff competition in the holiday lettings market and the availability of cheap flights to foreign destinations has resulted in the holiday industry on the Isle of Wight being no longer what it once was – this being evidenced by the low levels of occupation on Linstone Chine even during the main holiday seasons.  Apparently, only 30% of the units were occupied in August 2014, that percentage including those units that are used by owner occupiers.  There was evidence of many more modern developments similar to Brambles Chine where no planning restrictions or restrictive covenants of this type have been applied.   It was also important, it was said, for the Tribunal to note that when planning permission was obtained for a number of additional units on the Chine (as set out in paragraph 19 of the judgment relating to the Injunction Application), there were no conditions relating to periods of occupation (although it was acknowledged that those properties are still subject to the restrictive covenants imposed by LCMC). Thus a restriction that prevents occupation being for anything other than holiday use is realistically unsustainable, and the use of the words “for leisure purposes only” adds nothing further to the restriction. Indeed, LCMC appeared to have acknowledged this up to a point in the concession that they made at the commencement of the hearing – this being reflected in the terms of the suggested modification.  However, the restriction on night-time occupation during the restricted period remains 
25.	Thus the Tribunal was invited to find that different considerations apply to the respective different parts of the restriction, and to apply the statutory jurisdiction to each element separately.  
26.	As to the objector’s expressed fears that this application for discharge of the whole of the restriction, if granted, would become the thin end of the wedge, and would lead to an avalanche of further applications, it was submitted that what the objectors were seeking to protect had long since gone.  The effect of the Tribunal discharging the remaining part of the restriction (following the objector’s concession on the other parts) relating to night time occupation would not materially alter anything on the ground, but would merely regularise the position which, in reality, had existed now for very many years.   
27.	It was suggested that in the light of the objector’s wishes to secure the financial future of the company by obtaining planning consent for further bungalows on the site of the old clubhouse, swimming pool and car park area, and then sell that land to a developer, it would be in its interests to accede to the application. The removal of the restrictions on night time occupation would give the estate a more secure and sustainable future.  Mr Cottle also submitted that the restriction was contrary to the Memorandum of Association of LCMC (incorporated 28 February 1984) whereby Paragraph 3 (the objects for which the company is established) at (a)(i) states: 
“To acquire the freehold property known as Brambles Chine and Cliff End Estate ... and to hold the same as an investment for the benefit of the Members of the Company (hereafter called ‘the dwellingholders’...”
And at (a)(iii):
	“To sell to the dwellingholders the freeholds of their dwellings ... and to enter into such deeds containing such covenants, provisions and conditions as may be requisite to secure to the dwellingholders the full enjoyment of the residential units comprised in the Estate and to provide for the maintenance of the Estate.”  
With the restriction in place, it was submitted, the dwellingholders were not obtaining the benefit, or able to extract full enjoyment of their properties. 
28.	 Mr Stafford-Flowers said that the estate, and the island generally, had declined as a holiday destination over the years and many of the nearby pubs and hotels had closed due to lack of trade.  Many of the island’s holiday camps had also ceased to operate, and several of the beachside properties and holiday flats were now occupied as private residences throughout the year.  With fewer holidaymakers choosing the island for one or two week stays, preferring to come over on day trips or for weekends, property owners were seeing reduced letting incomes and were having difficulty making ends meet.  The estate’s shop which he had initially worked in was also struggling, and now closes between September and Easter.  The restriction on full-time occupation was, therefore, a detriment rather than a benefit to the estate.  The vast majority of the Brambles Chine and Cliff End chalets are now owned and occupied in one form or another by middle aged people and pensioners, many of whom use them as their principal residence for long periods during the year, only moving out during the “closed period”.  There were about 10 other properties on Brambles Chine and four on Cliff End where the owners, like himself and his wife, occupied their units for the full 52 weeks of the year.  This number, he accepted, had remained consistent during the whole period of his occupation.
29.	Mr Stafford-Flowers said that most of the properties on the estate had been improved by their owners since the freeholds had been acquired, many now having replacement double-glazed windows and doors and gas fired central heating.  The service charges payable for estate maintenance amount to about £400 pa, with a further £300 for mains water and the usual Council Tax charges. Average open market prices were now in the region of £55,000 to £60,000.    In his view the restrictive covenant was an anachronism that has a negative effect on values and the estate as a whole, whereas there are a large number of properties and sites on the island that have received unrestricted planning permissions, or have had time constraints removed on application or appeal. He produced a list of those properties of which he had knowledge, including some of the units on Brambles Chine and said that this proved that the restriction was now effectively obsolete and imposed an artificial restriction which did not feature on other estates.  The existence of the restrictive covenant did not, he said, provide any practical benefits of substantial value or advantage to the objector – indeed it had a damaging effect both in terms of the amount of occupation on the site at any one time and on property values.  There were currently 30 or so properties out of the 279 for sale and this indicated the difficulties that the restrictions were causing.       
30.	He accepted that he had signed the Deed of Covenant when the property was transferred to him and that it was effectively a promise to abide by the restrictions. However, he said that he had thought it was “just another piece of paper to be signed” and at the time probably hadn’t realised the precise implications.  He reiterated that it was common knowledge that there were several other properties occupied on a full time basis, and said that when he first came to work in the shop at the request of LCMC there had been no objection to his living at No. 182 on a permanent basis – this situation continuing for the 5 years that he worked there.
31.	Mr Stafford-Flowers accepted in cross-examination that the number of units occupied by full-time residents represented less than 5% of the total on the two estates and that there had been a significant number of occupiers (116) who had voted for the objector to oppose his application. He acknowledged that his was the only live application for discharge or modification of the restriction. 
32.	Whilst accepting that it was not directly relevant to this application, Mr Stafford-Flowers said that he had obtained a Certificate of Lawful Use from the council, this being, in his view, clear evidence that it had been accepted the property was his home. 
33.	Mrs Stafford said that she did not agree with the objector’s statement that the restrictive covenant mirrors the planning permission.  There were 20 units on the site that have no planning restriction in terms of user or occupation, and both the application land and No. 180 Brambles Chine have Certificates of Lawful Use.  She reiterated what her husband had said about other more recent developments having no occupation restrictions, including developments at Lower Hyde, Languard at Shanklin, Thorness Bay, Gurnard Pines and Seaview Holiday Bungalows together with the two new bungalows that had been constructed on Brambles Chine in the last few years.  Indeed, she said, with LCMC having acquired the land occupied by the clubhouse, old swimming pool and car park at Brambles Chine, they were currently in the process of drawing up plans for 18 bungalows of similar style to the others, and they would also not be subject to planning restrictions (as was accepted by the objector’s counsel during cross-examination).  Whilst she accepted that LCMC imposed the covenant to preserve the contractual scheme of covenants when the freeholds were sold, she thought it most unlikely that the developers who eventually bought the land for which planning permission was to be sought would do so if there were to be any such restrictions imposed upon the units that they were to build and sell.  
34.	In respect of the fact that the shareholders of LCMC had authorised it to acquire the former club premises, swimming pool, car park and adjacent land (which they did in 2012 for £150,000 funded by loans from the shareholders), she said that £120,000 had still not been repaid and nor would it be prior to the land being sold.  She said that whilst she and her husband had been invited to contribute, they had declined.
35.	Mrs Stafford said that LCMC let out some of their own units to students (although admittedly not during the “closed” period), and to council employees working on the island’s roads.  They were not, therefore, complying with the restriction as far as holiday or leisure use was concerned, and it was rather incongruous that they should be taking the stance that they were over this application. 
36.	Whilst she accepted that 116 of the shareholders of LCMC had voted in favour of the Company objecting to the application, she said there were over 100 who had not bothered to vote.
37.	As to the point that the objector had made about the fact that it was only the footprint of each unit that had been sold to the occupiers, and that all the surrounding land belonged to the Company, Mrs Stafford said that all of the units had large storage boxes on the patio areas (with permission) and with internal wardrobes, there was ample storage available for full time occupancy. 
38.	Of the 18 present or former residents of Brambles Chine and Cliff End who provided witness statements in support of the application, seven were called and gave evidence.
39.	Mr John Craddock of Freshwater Fruit Farm, Wilmington lane, Freshwater, IOW has, with his wife, owned one of the units on Cliff End for some 18 years although they have never occupied it for their own use.  He said the restrictive covenant was outdated, and due to the difficulties people generally have letting their units for holiday purposes, the 10 week period (20% of the year) during which the properties cannot be let exacerbates the problem.  He said he could see no reason why many of the older and retired owners who wish to live there all the year round could not occupy their properties in harmony with those who wish to let them for holiday purposes.  During the “shutdown period” site security was negligible and having people there all the time meant less risk in that regard.
40.	As to the objector’s argument that Monks Lane was not suitable for the extra traffic that would be generated by full-time occupancy, Mr Craddock said this was nonsense.  The road coped perfectly well with summer and winter use outside the restricted period, and in any event LCMC was looking to enable further residential development – a plan that seemed strange if there were concerns about the road.  The same goes, he said, for the suggestion that the electricity and sewage services would need to be upgraded if use was not restricted to 42 weeks a year.    
41.	Mr Ronald Anderson of 65 Cliff End said that he and his wife purchased their unit in 2001 and have occupied it as their main and only residence ever since.  He said that whilst he was, of course, aware of the restrictive covenant, having signed the transfer on purchase, he had been told unequivocally by a former manager of the estate, Mr David Osborne, that there were other units occupied all the year round, and that it would be alright for them to do so as well.  In any event, Mr Anderson said that he had not taken too much notice of the restriction when he purchased as it had been their intention to travel abroad during the winter months, but now he was in his eighties, that was no longer possible and he was therefore a permanent resident.  He said that here had been an increase in older residents residing throughout the year as the holiday market had declined.
42.	Mrs Ann Evans, with her husband, formerly owned one of the units on the estate, but sold it in 2002 and she admitted that they had nothing to gain or lose in respect of the application.  She repeated in her witness statement most of the issues that had been raised by the other witnesses who had supported the applicant and said that it was “a few sentimentalists who unrealistically desire to maintain Linstone Chine in a retro ‘Hi-de-Hi’ image that was popular half a century ago” when it supported a clubhouse, bar, pool, shop and launderette.  Things were very different now – evidenced by the decline in services available on the estate, and there are only very few of the units offered for holiday lets through the LCMC lettings offshoot.  It was a fact that despite the ban on night-time use during the restricted winter periods that the site remained staffed, so there would be no additional costs involved if the restriction was relaxed. The decline in the holiday market was, she said, the reason they sold their property.
43.	Mrs Christina Tirone owns No. 241 Brambles Chine which is one of 22 units on the estate that is not subject to the planning restrictions that apply to the rest of the properties, including the application land.  She said she had lived there since 1986 as her main and only residence and during that period had seen the Chine decline from a thriving family holiday location due to falling numbers of holiday makers, and there were now more people using their properties for full time occupation.  There were no longer any of the type of holiday facilities that families expected, apart from the shop and launderette.   
44.	The circumstances relating to the ownership of her property were, she explained, different to the application land in that hers was one of two that had been in different ownership prior to her purchase, and she had not entered into the restrictive covenant owing to her understanding that all year round use was unrestricted.  She also said she did not pay the estate maintenance charge. Whilst she accepted that she had agreed to abide by the occupancy restrictions when on 5 May 1992 she signed a Tomlin Order following High Court proceedings that had been brought by LCMC against her “living in”, she said that she had in fact continued to live there full time. In respect of these points, Mr Hawkins, (the Estate Manager) produced at the commencement of his evidence on the second day (when Mrs Tirone was unavailable to be recalled) a copy of the Tomlin Order and the relevant transfers relating to her unit and the adjoining one, no. 242.  It was accepted that, in fact, these two properties did not form part of the Linstone Chine management scheme, the owners were not shareholders within the company and were not therefore subject to the same Company rules as the other properties. However, Mr Jones in submissions for LCMC insisted that the restrictive covenant did apply.  It is apposite at this point, I think, to record that the complex and somewhat confusing evidence relating to Mrs Tirone’s ownership of No.241 was not in my view critical, in the light of all the other evidence produced, to the Tribunal’s determination of this application.
45.	Mr Neil Cain is the owner of 176 Brambles Chine, having purchased it in 1992.  He bought another unit, No. 80, in 1999.  He said that he was well placed to comment upon the issues in this application due to the fact that from 1994 to 2011 he was Finance Director of LCMC, and between 2000 and 2010 was also Chairman.   He helpfully produced two factual statements setting out the history of Brambles Chine which had commenced life as a holiday camp in 1935 and operated as such until 1972 when it closed due to the increasing popularity of self-catering and foreign holidays.  The land was acquired by a developer who commenced the construction of the self-catering bungalows in the mid 1970s, which were sold leasehold at a ground rent of £10pa.  After the developer got into financial difficulties, the site was sold to Tenasti Ltd, but in the late 1970s that company went into receivership.  The leasehold property owners then formed LCMC and acquired their interests from the receiver.  All the lessees then had the opportunity to buy their freeholds.  The clubhouse, bar, swimming pool complex, a store, launderette and car park were acquired separately from Brambles Chine Ltd in 1980 by a private leisure facility operator.  None of the operations succeeded, and the area changed hands a number of times over the years but eventually all activities ceased and the area fell into a state of dereliction.  LCMC obtained permission from IOW council in 1991 to turn the store into a shop, but again this has failed to become an economically sustainable operation.        
46.	Mr Cain explained that the Company had initially tried to enforce the occupation restrictions, but it became evident over the years that there was less and less holiday use.  Some 20% or so of the properties were now owned by livers-in for either 42 or 52 weeks of the year (some going abroad for the winter) and as he had discovered from his ownership of a second unit on the estate, returns from holiday lettings were becoming increasingly poor.  It was his view that there was no point in continuing to try and enforce the restrictive covenant which was the subject of this application due to the changes in the market – this being clearly evident from the failure of the on-site leisure facilities.  He agreed that the former ban on daytime use had been effectively overtaken, and was comfortable that there would be no harm or injury caused by a modification that permitted daytime use of the application land, and deleted the requirement for use for holiday or leisure purposes only.   He said there would be no increased strain on the services or infrastructure as over Christmas and New Year there are very few properties occupied.  There were several sites like Brambles Chine on the island which were suffering from the same levels of dereliction (in terms of their leisure infrastructures) which was indicative of the substantial decline in this type of market. There were currently 40 of the units on the market, some of which had been available for over two years.  The site at Thorness Bay referred to by the applicant had gone from holiday use to full occupancy.  The site at Gurnard Pines had had four changes of operator in the past four years, and it appeared that none could make a go of it, but it was pointed out that the ownership structure of units there was different to Brambles Chine.
47.	As to whether modification of the applicant’s restrictive covenant would open the floodgates to a large number of further applications, Mr Cain said that would not make any difference as the site would benefit from having mixed full-time occupation and holiday uses.  However, he said that he was only providing evidence in respect of Mr Stafford-Flowers’ application, and any others would have to be dealt with on a case by case basis. 
48.	Mr Gregory Collett owns 102 Brambles Chine which is occupied by his father, Mr Don Collett (who appeared before me) throughout the year, other than during the restricted periods.  He said that he would occupy throughout the year if it were not for the restriction.  He had previously owned another unit on the site which he held as an investment, but sold it when he found that he could not achieve sufficient letting income to make continued ownership economically viable.  Mr Collett said that more of the units were now being occupied as principal homes, mainly by older people, and he said he had no strong wish to see the restriction maintained.
49.	Mr Robin Oliver owns No.248 Brambles Chine, having bought it in 1999, and resides there throughout the year other than through the restricted period.  His was one of the eight properties at the entrance of the Chine that did not have the planning restriction, but it was still subject to the restrictive covenant. He said that since he had bought the property, he had witnessed a serious decline in holiday trade, and the facilities on the site were now virtually non-existent for holidaymakers compared with what they had been.   Part of the reason for the lack of holiday use was the fact that for over two months of the year, the properties could not be used for that purpose.  The site had become “financially strangled” by the lack of use and he saw no reason why there could not be a mixture of full-time occupiers and holidaymakers.  That situation would also help to improve security.  Mr Oliver admitted in cross-examination that the text of his witness statement which in parts was identical to what others had said, had been drafted and typed by the applicant, and he had agreed to it and signed it.
50.	Witness statements in support of the application were also submitted from Mrs Jane Bartlett, a former owner of No. 205 Brambles Chine, having sold it because it was no longer financially viable as a holiday home investment; Mr John Lovelock, who owns No. 203 said that the restriction that he had also signed up to was no longer relevant, especially as there are now several units that are occupied 52 weeks of the year, but the objector had only taken action against the applicant; Mrs Laura McNamara of 216 Brambles Chine said the majority of other similar sites on the island had had their occupancy restrictions removed with no adverse effects; Mrs Jean Keanor, who with her husband owns and occupies a double unit at 155/156 Brambles Chine throughout the year, said the restriction does not achieve any benefit to owners at it restricts the use and depresses values; Mr Michael Glover of 191 Brambles Chine mirrored what had been said by a number of the other witnesses as did Mrs Catherine Siracusano of 187 Brambles Chine, Mr & Mrs Roger Hall of No.88, Mr Denis Steel of No.93 and Mr James Ashton of 10 Cliff End, all of whom occupy their properties throughout the year.    Both Mrs Janet Taylor of 170 Brambles Chine and Mr Barry Lyttle of No.38 own their properties as holiday homes and referred to the economic difficulties of letting them and the deteriorating nature of the estate.
51.	Mr David Timothy Mark Rhodes FRICS is a partner in Hose, Rhodes Dickson an independent firm of Chartered Surveyors based on the island.  His specialist fields are in surveying, valuation and estate agency.  He accepted in cross-examination that he had no specific expertise on planning matters and acknowledged that Mr Hepburn, the objectors’ expert (who he had not realised was involved and whose report he had not seen) was more appropriately qualified to deal as an expert in respect of these issues.   He said that he had been asked to comment upon the objector’s statement of case.
52.	Mr Rhodes said that typical modern conditions applied to planning permissions on the island might say “the applicant (or their successor(s) in title) shall maintain a comprehensive up-to-date register listing occupiers of the holiday accommodation hereby approved, their main home addresses and the dates of occupation at the site.  The register shall be made available for inspection by the planning authority.”   The Authority recognised that the nature of tourism had changed and that to satisfy consumers a much higher level of investment was required, therefore the old fashioned and restrictive time conditions had been dropped in favour of 52 week occupation.  He said that the character of Linstone Chine had changed over the years, as had that of other similar developments, where the owners had found that the provision of extensive leisure based on-site facilities was no longer economically justified (an example being Harcourt Sands between Seaview and Ryde).    
53.	In his view, the increased occupation of units on the site during the current closed period would not be detrimental to the peaceful nature of the site, and he did not foresee any particular problems over traffic management and use of Monks Lane (which he admitted was not an ideal access) if the use restrictions were lifted.  It was a fact that comings and goings during non-peak traffic times to holiday accommodation tended to be more frequent than by owner/occupiers, but he accepted that at peak times higher full-time occupation may lead to an increase.
54.	As to the objector’s concerns about the ability of the electrical and other service installations to cope with increased use, Mr Rhodes said he failed to see how if the systems could cope over the Christmas and New Year periods, and in February and March (the coldest months) when occupation was permitted, there would be any problems during the rest of the currently closed period.   Whilst he pointed out that the recently adopted Island Plan recognised the provision of holiday accommodation as an important industry, it did allow for the fact that there have been changes and that where properties may have become unfit for purpose, alternative uses should be encouraged.  However, he said that he could not disagree with Mr Hepburn’s assertion that the local planning authority would never grant unrestricted planning consent upon a site such as this in this location.
55.	Although it was not something that had been raised in the papers he had seen, he commented that due to the precarious location of the applicant’s property, right on an unstable cliff edge, it was most unlikely to have a life span of much more than, say, 5 years.   
The case for the objector
56.	Mr Jones explained that LCMC, which is a Membership Company, had, in order to pursue its objection to this application, sought a mandate which was obtained by a vote of 116 in favour and 51 against.  It was, therefore, a clear majority of those who did vote, but he accepted that it did not constitute a majority of the overall number of shareholders – many having not responded to the request.  Whilst it was the objector’s original case that the whole of the restriction should remain, and that the applicant’s attempt to deconstruct it into separate constituent parts was misplaced, the concession made on the second day of the hearing meant that the issues had been shortened and simplified.  It was, it was submitted, for the applicant to satisfy the Tribunal that the covenant, even in the modified form suggested, should be discharged or modified on one or more of the grounds set out in section 84 of the 1925 Act.  However, realistically, there was no room for further modification such as adjusting the times or dates when the properties should not be slept in, so the issue was simply therefore a matter of discharge or not.
57.	Mr Nicholas James Hawkins is currently General Manager of LCMC, and had been authorised by the Members to make his witness statement, and a supplementary statement which related to the clubhouse/swimming pool area.  He set out the background as to how and why the Company had been set up in 1984.   He said that the chalets at Linstone Chine were typical holiday units and comprise only basic living accommodation.  None of the outside areas belong to the freehold, and although LCMC permit storage boxes to be located adjacent to the chalets there are no garages, sheds or any other outside storage areas which would be needed by a full-time, live in property.  The access roads are not up to estate standard, and even the weekly refuse collection lorries can cause damage to the surfaces.  Historically, there was only ever about 30% occupation of the estate, even in the summer months, so car parking was not a problem as such.  However, if they were all to be occupied as permanent live-in homes that would become a problem and the Company had also been advised that the electricity supply would have to be upgraded at a cost of approximately £500,000 to cope with the increased demand.  The simple fact was that the estate had been developed as a holiday park in accordance with the original planning permission, and neither the buildings nor the infrastructure were suitable for full residential use.     
58.	As to the applicant’s occupation, Mr Hawkins said that during a routine security check during the closed period in November 2005, he noticed that No.182 was still being occupied, and wrote to Mr Stafford-Flowers reminding him of the restrictive covenant and, in fact, quoting it.  However, full time occupation continued in defiance of the restriction despite further reminders.  He said he contacted the local planning authority on a number of occasions in an attempt to persuade them to take action under the relevant planning Act (this would save the Company money in taking enforcement proceedings), but they failed to do so.  It was then decided that the Company would have to take legal action and court proceedings were instituted in April 2010, this resulting in the injunction which was currently stayed.  Mr Hawkins pointed out that the judgment of Recorder Belben determined that there had been no evidence before the court to enable him to conclude that the character of Linstone Chine had so fundamentally changed over the years that to grant an injunction would be redundant; that the nature of the site and the chalets was not that of permanent living accommodation and that if people were allowed to live there all the year round, the character of the area would deteriorate. 
59.	Regarding the Certificate of Lawful Use that the applicant (and his neighbour along with some others) have obtained from the Local Planning Authority, Mr Hawkins said that it was not some form of deemed consent, but was purely granted in accordance with the provision of the relevant Planning Act because it was satisfied that the particular use of the property had been in place for a sufficient period of time. It thus had no choice but to grant the certificate, but it could not be said to be a tacit approval of the occupier’s actions.  It was not, therefore, a ‘material circumstance’ as argued by Mr Stafford-Flowers.
60.	There had not been a change, in Mr Hawkins’ view, in the character of the site, and it was still very much a holiday park.  The majority of the chalet owners use them for holidays, and some let them out as holiday lets.  They purchase their properties with full knowledge of the restrictive covenants, and the price they paid reflected the limitations on use imposed by them.  He did not agree with the applicant’s contention that the continued existence of the restriction impedes some reasonable user for public or private purposes.  It would not be reasonable for someone to occupy a building which had been designed and constructed as a holiday chalet (with an infrastructure that was appropriate for that use and nothing else), and paid a price which reflected that, then blatantly to defy the restriction and occupy it throughout the year as his sole and main residence.  
61.	His main concern, accepting that the removal of the restriction on just one property would make little overall difference, was the ‘thin end of the wedge’ argument.  If the Tribunal were to discharge the restriction, it would undoubtedly lead to an avalanche of further applications (it being acknowledged that there were a number of other occupiers who also defy it) and there would be nothing that the Company could do to prevent Linstone Chine potentially becoming a housing estate that bore little or no resemblance to what it had been designed for.  The peaceful nature of the site would be entirely lost, and the whole character would change.   There would also be many knock-on effects for the Management Company.  Considerable money would need to be expended upon the infrastructure, and the resultant increase in service charges would be unfair upon those owners who use their units for the purposes for which they were designed.   Those concerns also went to the question of whether or not, under section 84(1)(c), discharge would cause injury to the other residents.  This was effectively an intact scheme of covenants to which virtually all the residents were subject, and for these reasons, injury would most certainly be caused. 
62.	Mr Hawkins explained in his supplementary statement that prior to LCMC being in a position to purchase the entire site, a third party had bought the area occupied by the clubhouse, swimming pool, car park, shop and launderette together with 241 and 242 Brambles Chine (No.241 being the unit now occupied by Mrs Tirone who gave evidence) and he accepted that those two chalets were not a part of Linstone Chine.  After the owners of the leisure facilities ran into financial difficulties, the area was eventually purchased by LCMC in April 2012 for £150,000 with the assistance of some contributions, but mainly loans, from the residents.  In February 2014 there were discussions at a board meeting about what to do with the area which he accepted was currently unused (apart from the shop and launderette).  The main focus of the meeting was on clearing the site and building a number of new bungalows together with a new club house and meeting room, possibly including a bar/bistro, together with a shop, office and store.  No final decision had yet been made, and there was no current timescale due to lack of required finances.  He said that one of the options being considered was to sell the area to be occupied by new bungalows (subject to planning) to a developer.  There would be a similar restriction to that which was the subject of this application, even if planning consent was unrestricted.  The money raised from the developer would, it was hoped, be sufficient to repay the outstanding loans and to build the required, albeit much restricted, leisure facilities.  Proposals were currently in the process of being produced, and it was hoped they would be ready by April 2015, and would then be put out to the Members for consultation.
63.	In cross-examination, Mr Hawkins accepted that one of the parameters in LCMC’s Memorandum of Association was for the properties to be held as an investment and there was thus a case for allowing a wider market.  However, he said this had been discussed by the shareholders on a regular basis, but the board had always said no.  For instance, a suggestion that the units could be let to workers on the proposed Navitus Bay offshore wind farm to the west of the island had been refused.
64.	Regarding the concession that had been made, Mr Hawkins said that it was the Members of LCMC who had created a definition of occupation which meant not sleeping overnight during the restricted periods (although the definition of holiday use versus owner occupation had not been specifically debated), and accepted that he would be unable to argue against there having been tacit acceptance of owner occupation on all but 74 nights.   Therefore, with the specific reference to holiday/leisure use removed, and with Mr Stafford-Flowers having received confirmation that he was not in breach of planning control, Mr Hawkins was asked if he thought the user was not reasonable because he was still in breach of the restrictive covenant (relating to night-time use).  He accepted that the Tribunal had jurisdiction to modify the restriction even if the applicant was in breach.  He also accepted that, with the reference to holiday/leisure use having been removed in the wording of the proposed modification it did not entirely reflect LCMC’s attempts to ensure that the nature of the site did not change.  
65.	Mr Cottle then asked how many of the units of the site were in the same situation as the applicant now found himself in, i.e. not being in breach of planning control, and no longer having a restriction to holiday/leisure use only.  He said that there were 22 units that have no planning restriction or have had it removed by the obtaining of a Certificate of Lawful Use, that being relatively easy to obtain for those who had owned their properties for more than 10 years, but there were, to his knowledge, only 10 owners who occupy all the year round (including overnight) in breach of the restrictive covenant.   As to what the Company might be able to do in respect of those who purchase properties to ensure they abide by the restrictive covenant, Mr Hawkins said that they could be asked to sign a document confirming that they had read and understood the restriction and that they would abide by it.  He was concerned that the thin end of the wedge argument might well go beyond the 20 or so who might want to follow in the applicant’s footsteps and that, with the resultant potential increase in value of their existing holiday homes, there was a fair chance that many more owners would follow suit, and with the Tribunal having decided in favour of the applicant (if it did) there would be little the Company could do about it.   
66.	Mr Hawkins accepted that occupancy overall was low, but he had not received any suggestion that occupiers wanted the site to be busier.  The fees receivable from the owners would be the same however much they were occupied and it should be remembered that most owners do not let their properties at all, choosing only to occupy them for their own use as and when they want to as second homes.  It was one of the attractions of the site that it was a quiet place for people to enjoy their holidays, and he was concerned that traffic on the site could well triple if all the units were occupied as main homes.  He said that the Company gets many enquiries from potential purchasers of units on the site about year round use, but always says no. 
67.	In respect of the Recorder’s conclusions in the injunction judgment, Mr Hawkins accepted that the evidence before this Tribunal was different.  In answer to a question from me, he said that the reason they had not taken action for an injunction against all the livers-in was because the Company needed to be sure it would succeed.  It was, to all intents and purposes, a test case.
68.	Mr Glen Hepburn is a planning consultant who had been asked to consider how the restrictive covenants run in parallel with the planning restrictions that apply to the application land and the majority of the other units on the site, and whether or not, in accordance with the Development Plan, consent would be achieved at the present time for unrestricted residential use.  In general, he said, planning permission would not be granted for residential development in out-of-town locations such as Linstone Chine unless they enhance the tourism provision on the island.  There was a general presumption against development outside settlement boundaries unless other material considerations outweighed that presumption.  The provision of holiday accommodation would be deemed to outweigh that presumption due to the fact that the local planning authority had recently gone through the process of reviewing its Core Strategy (April 2012), where it was deemed fundamental to retain all holiday accommodation on the island unless it could be shown that it was no longer needed.    There had been a number of applications made on the island since 2012 where it had been demonstrated that holiday accommodation was still required, so any application for non-holiday use would now be resisted
69.	Further, in considering any application, the local planning authority would take into account whether or not the units were fit for purpose for full time residential occupation and whether the roads were adequate to accommodate the inevitable increase in traffic.  With six to eight vehicle movements (VPM) per day for the average household, this would be likely to be up to three times more than the levels based upon the limited use of the properties for holiday accommodation.  Monks Lane, as an unadopted track where the owner was not known, was wholly inadequate as were the vision splays where the lane meets the main road. Although no evidence was produced to support the contention, Mr Hepburn said that there would also be a requirement to improve the infrastructure such as electricity and other services.  Finally, with sites that are over 1ha in size, there would be a need to undertake a Flood Risk Assessment.
70.	It was suggested that there was a pattern of planning permissions for 52 week occupation on other sites, as well as for 20 of the units on Linstone Chine, and surely that was an end to the matter.  Mr Hepburn said that the test was whether or not they were second homes or holiday accommodation.  That was easy to establish by checking if the owner has another property that is his or her main residence.  Permissions for 52 week use, he said, still contained a restriction on use for holiday purposes and he produced a copy of the standard condition that was attached to such permissions which required occupants to record dates of occupation, and to make that register available for inspection at reasonable notice.   Mr Hepburn accepted that Policy SP4 supported mixed use developments, but said it was not appropriate to look at policies in isolation.           
71.	Mr David Slade and his wife (whose main home is in Littlehampton) bought No.168 Brambles Chine in 1998 for holiday use by themselves and members of their family.  He said that they bought in the full knowledge of the restrictive covenant, and that they were happy that it could be expected to preserve Linstone Chine as a holiday site, and prevent it becoming “a ghetto of low-cost permanently occupied dwellings.”   He said that if the restriction were to be removed there would be a considerable risk that the whole character of the development would change.  The units were not, due to their lack of storage facilities, suitable for permanent use, this being evidenced by the amount of clutter around the applicant’s property.  As to the suggestion that mixed use of the site (some permanent and some holiday occupation) might make the development more financially viable, Mr Slade said that money did not come into the equation – it was the peaceful nature of the site as a holiday park that was the important consideration. 
72.	Mrs Gabrielle Dean of Billingshurst also, in 2003, bought 247 Brambles Chine for holiday use, and she, along with all of the other witnesses for the objector, effectively reiterated what Mr Slade had said.       
Discussion
73.	I have set out at some length what was said by those who appeared before me, most of the evidence being matters of fact together with personal and, from the experts, professional opinion. Not surprisingly, as far as the witnesses of fact were concerned, only passing reference was made to the specifics of grounds (a), (aa), (b) and (c) of section 84(1) of the Law of Property Act 1925 upon which the applicant originally relied, and it was also clear from the evidence of the two experts that neither had particular knowledge of the role of this Tribunal in determining applications for the modification or discharge of restrictive covenants.  However, I helpfully received from counsel following the hearing extensive submissions on the law within which the jurisdiction of this Tribunal is enshrined, including arguments relating to the question of issue estoppel following the injunction proceedings before Newport County Court.  
74.	I proceed therefore by summarising counsel’s submissions and arguments under each of the grounds as they apply in this case, and from these and the evidence, set out my conclusions accordingly.  It was submitted for the applicant that following the concession made by the objector on the second day of the hearing  the applicant’s case on obsolescence was overtaken and is water under the bridge. Further ground (b) was not pursued.  Mr Cottle submitted that the applicant’s case now turned principally upon section 84(1)(aa) and (1A) of the 1925 Act and the main issue was whether the prohibition of occupation between 5pm and 10am on each day during the prohibition period secures to the Members of LCMC practical benefits of substantial value or advantage . Nevertheless, for the avoidance of doubt I do address Ground (a) because it was raised in the evidence before me, it featured in the County Court and Mr Jones addressed the matter in his closing submissions.”
Ground (a)
75.	It was submitted for the applicant that the material change of circumstances that had been referred to in opening had led to a material change in the character of the site with more properties being occupied as owners’ second homes or as their sole and only residence.  With the objector’s concessions both in respect of daytime use during the restricted periods, and by its proposed modification of the restriction which removed the reference to holiday/leisure use, this was a sufficient ground for the Tribunal to determine that the restriction ought to be deemed obsolete. The fact that only about 30% of the bungalows were occupied by holidaymakers even in the summertime proved that the restriction to holiday use was unsustainable, and there was therefore no sound reason for not discharging the restriction altogether and allowing full-time occupation by those who wish to have these units as their principal residences. The Tribunal was also invited to find that the granting of Certificates of Lawful Use and Development upon the application land and several other units was a “material circumstance” for the purposes of ground (a).
76.	The objector submitted that the applicant’s property, along with the rest of Linstone Chine had retained its essential character.  The property was a small unit with limited accommodation and surrounding amenities, suitable only for temporary or short term occupation, and the site was to all intents and purposes a peaceful and somewhat remote holiday park with an infrastructure commensurate with that use.  The objector’s witnesses had all expressed their concerns about what might happen if the application was allowed, on the assumption that whilst one single unit being fully occupied would make little difference, the floodgates would be opened for further or even joint applications, and the park would become a very different entity.  There were far more residents who had voted for the application to be fought by LCMC than there were who were prepared to “break ranks” and speak in support of the application. It would be an uphill struggle for the applicant’s wishes to prevail over those of the majority of the respondents to the vote.  
77.	 The original purpose of the covenant could still be served (even in its modified form).  Even lengthy, temporary occupation of a property (such as for use as a second home) would not undermine the existing character of the site – provided that those occupiers abided by the restriction on night time occupation during the restricted periods. Indeed, Mr Hepburn had confirmed that the range of C3 holiday uses “extends to second home use which appears more appropriate to this site” in planning terms.  The fact that the applicant (and others) had obtained Certificates of Lawful Use did not make permanent occupation of the properties a reasonable user.  There was still in place a scheme of covenants relating to the type of use for which the development was originally constructed and to which the Members of LCMC willingly subscribed. There were no grounds for concluding that the restriction could be deemed obsolete. 
Issue estoppel
78.	 The objector submitted that, in any event, the applicant was precluded, by issue estoppel, from relying upon ground 84(1)(a). A court of competent jurisdiction has already concluded, in substance, that the character of Linstone Chine had not changed such as to render the restriction obsolete.  Although the learned judge had used the word ‘redundant’, it was submitted that that was, in the context of this case, synonymous with ‘obsolete’.   It would be a rare and unusual exercise of the Tribunal’s discretion if it were to discharge a covenant which, in its surviving form, had been enforced by a court by means of an injunction, and against which there had been no appeal.   The test for issue estoppel was summarised in Mills v Cooper [1967] 2 QB 459 where Diplock LJ said, at page 468: 
“That doctrine, so far as it affects civil proceedings, may be stated thus: a party to civil proceedings is not entitled to make, as against the other party, an assertion, whether of fact or of the legal consequences of facts, the correctness of which is an essential element in his cause of action or defence, if the same assertion was an essential element in his previous cause of action or defence in previous civil proceedings between the same parties or their predecessors in title and was found by a court of competent jurisdiction in such previous civil proceedings to be incorrect, unless further material which is relevant to the correctness or incorrectness of the assertion and could not by reasonable diligence have been adduced by that party in the previous proceedings has since become available to him.”    
79.	The recorder’s decision, it was submitted, was also relevant to the question of the Tribunal’s discretion, whatever finding was made in respect of ‘reasonable user.’  A court, had recently seen fit to recognise as valid and to enforce precisely what it is that the applicant now sought to challenge. It would be an unusual exercise of its discretion for the Tribunal to discharge a restriction which a court had only recently seen fit to enforce. 
80.	In response on this point, it was submitted by Mr Cottle that the applicant’s case on obsolescence was in relation to parts 1 and 2(a) of the wording of the restriction, and due to the concession that had been made, that was now ‘water under the bridge’.  It was accepted that this Tribunal has to give due weight to the findings made by the Recorder if it finds that there are any diametric disagreements or tensions with the learned judge’s conclusions, and to state clearly why. A conclusion that the site would deteriorate could, it was submitted, only have been reached in the previous proceedings on the presumption that all of the units would go into permanent residential use, whereas the evidence before me had demonstrated that that was most unlikely to ever be the case with only a small number of owners seeking to follow the applicant’s lead and apply for the restriction to be modified or discharged in respect of their own properties.  Thus, the character of the site would be more akin to a ‘mixed-use’, the circumstances therefore being sufficiently different to what the judge was considering for me to conclude that the question of issue estoppel did not arise.  In any event, Mr Cottle said, the Recorder found that the defendant’s case had not been proved, that not being a positive finding sufficient to preclude this Tribunal from properly discharging its decision making function and arriving at its own conclusions.  The Tribunal has the benefit of different and more extensive evidence, more informed discussion on the issues, and the benefit of expert evidence which had not been adduced in the earlier proceedings.  It was thus considering different issues from a different perspective measured against different legal criteria.
81.	  Whilst I am satisfied that there is some force in Mr Cottle’s arguments, the question of whether or not issue estoppel arises is not, as it transpires, a matter which I need to determine as I have come to the conclusion, on the evidence, that there have been no changes in the character of the property or the neighbourhood, or any other material changes of circumstances sufficient to lead me conclude that the restrictive covenant ought to be deemed obsolete.  Even on the basis of the more extensive evidence and argument that was before me, which I do not believe was before the Recorder, I agree with, and do not demur from the conclusions he reached.  
82.	There clearly have been changes to the estate over the years since it was first built as a holiday park due to the demographic and social transformations in terms of holiday requirements.  Hence the lack of use, subsequent deterioration and eventual closure of the on-site leisure facilities, the considerable reduction in short-term holiday lets (as was clear from the evidence of most of the witnesses of fact) and the fact that it appears many of the properties are now occupied more as second homes rather than as pure holiday let units.  However, the key point, to my mind, is the fact that despite these changes, the site remains, as Mr Slade and a number of the other objectors said, a peaceful holiday park the nature of which would alter very much for the worse if, eventually, it became a standard residential estate with full-time occupation of many more of the units.
83.	I accept the argument that the chalets are not suited to full-time occupation and agree with Mr Hawkins that particularly with the freeholds only extending to the footprint of the units, they remain what they were designed to be – properties for short term and holiday accommodation, or even second homes.  I agree with Mr Jones’s submission that even with lengthy occupation as a second home (which would be permitted under the modified restriction as proposed, so long as units were not occupied overnight during the restricted periods), would not undermine the existing character of the site.
84.	In my judgment, retention of the overnight restriction is the anchor by which the nature of the site can continue to be maintained, and will ensure that it does not eventually become a housing estate for full time occupation for which it is undoubtedly most unsuited.  
85.	Although not referred to in submissions, the case of Re Truman Hanbury Buxton & Co Ltd [1956] 1 QB 261 sets out the test of obsoleteness to be whether the purpose for which the restriction was imposed is still capable of achievement.  Romer LJ said, at p.271:
“It seems to me that, as sometimes happens, the character of an estate as a whole or of a particular part of it gradually changes, a time may come when the purpose to which I have referred can no longer be achieved, for what is intended at first to be a residential area has become, either through express or tacit waiver of the covenants, substantially a commercial area.  When that time does come, it may be said that the covenants have become obsolete, because their original purpose can no longer be served and. In my opinion, it is in that sense that the word “obsolete” is used in connection with section 84(1)(a).”  
86.	For the reasons I have set out above, and despite the applicant’s arguments and the support he received from a number of property owners on the site, in my view the time has not yet come whereby the character of the site has changed to such an extent that the purpose of the restriction should be deemed obsolete, and the application therefore fails under this ground.  
Ground (aa)
87.	It was agreed that in determining the issues under this head, the six questions posed in Re Bass Ltd’s Application (1973) 26 P&CR 156 afford a useful guide to points the Tribunal is required to address.  They are (i) Is the proposed user reasonable? (ii) Does the restriction impede that user? (iii) Does impeding the proposed user secure practical benefits to the objectors? (iv) If the answer to (iii) is yes, are those benefits of substantial value or advantage? (v) Is impeding the proposed user contrary to the public interest? and (vi) Would money be adequate compensation?
88.	It was submitted for the applicant that using the property for residential occupation, and sleeping in it was a reasonable user – that is what it was designed and built for.  I agree that in practical terms residential occupation of a residential property constitutes a reasonable user, and the existence of the restriction (even in its proposed modified form) impedes that user.  Therefore, the real issue was whether by allowing the application there would be a precedent effect.  In that regard the Tribunal was invited by the applicant to find as a fact that LCMC’s concerns that the restriction would become unenforceable in respect of the other properties on Linstone Chine were unfounded.  It was, it was suggested, notable that LCMC had not advanced any argument in respect of the thin end of the wedge issue other than the expression of those concerns.  The fact was that only a limited number of the units were in a similar position to the applicant (in planning terms) and therefore it would be most unlikely that the situation would ever arise where all of the units took steps to have the restriction on overnight occupancy removed.  Thus, it could not be argued that the ability to avoid that potential scenario was a practical benefit of substantial value or advantage.   
89.	Further, it was submitted, the concern expressed by LCMC that the peaceful nature of the site would be eroded, and that if full-time occupation were to be permitted, the current generally low overall occupancy would substantially increase, was not something which the restriction had been designed to cover.  There was no mention of limitations on occupancy during the unrestricted period, and if in reality all the properties were occupied during such times, they would not be in breach of the covenant.  It should also not be forgotten, Mr Cottle said, that Mr Hawkins had agreed in cross-examination that whilst the Company’s principal concern was what would happen if all units were “released” from the restriction, if that occurred on only a few units, it would not create a particular problem.  Indeed, as Mr Cain had said in his evidence, if the site were to eventually become “mixed-use” in that it was made up of part full time occupiers and part holiday homes, that could be advantageous to the future viability of LCMC.  Accordingly therefore, the floodgates argument and concerns about the potential effects were ill founded.
90.	I was invited to consider Shephard v Turner [2006] 2 P&CR 28 in terms of assessing the substantiality of the benefit secured by the covenant.  There, the Tribunal had found that allowing an application would be most unlikely, on the facts of that case, to lead to more than one similar application.  In this case, I could if so minded find that the operative factor in allowing the removal of the night-time restriction should be dependent upon the local planning authority either replacing the current condition with the up to date mechanism that had been referred to by Mr Hepburn and which they had used in recent planning consents, or agreeing to full-time residential use (but it was accepted by Mr Rhodes that that would be most unlikely).  There was not, it was suggested, a scintilla of evidence to suggest that by allowing this application it would mean that the night time restriction would become unenforceable and that full time occupation would therefore be possible for all the properties. 
91.	Mr Jones agreed that the thin end of the wedge principle was of key importance in this case, and I was reminded of the Recorder’s statement in the Injunction judgment that “it was common ground that at all times a majority if not an overwhelming (sic) owners/members did not want owners to live on the site all the year round”.  This fact, it was submitted, enabled the Tribunal to readily conclude that the restriction, in prohibiting precisely that which the majority did not want, secured to the members a practical benefit of substantial value and advantage.  
92.	Also of particular significance is the application of section 84(1B) and the requirement to take into consideration three particular factors, namely (i) planning patterns, (ii) the period and context within which the restriction was created or imposed and (iii) any other material considerations.  Looking firstly at planning, the evidence referred to the Core Strategy, Policy DM5 and the Island Plan.  Whilst it was accepted that there may have been a number of other locations on the island where unrestricted planning consents or amended permissions had been granted (although no specific evidence was adduced), the fact remained that this was a location where, it was agreed, permission for unrestricted residential development would not be forthcoming due to the site being outside the settlement boundary, and having access difficulties.  Similarly, relaxation of the existing planning permission would not be forthcoming as it would not be a means of satisfying the needs and policies of the council.  Specifically, the Core Strategy of April 2012 provided for the retention of all holiday accommodation unless it could be shown that it was no longer needed.  The voting majority of the residents had expressed their wish to preserve the character of the site as a holiday park, that demonstrating the need.  It was also submitted that I should be mindful of Carnwath LJ’s words in paragraph 58 of Shephard v Turner where in relation to ground (aa) generally he said: “The section seeks to provide a fair balance between the needs of development in the area, public and private, and the protection of private rights.”  
93.	 The existence of those private rights is also to be taken into account in considering the period at which, and the context within which, the restriction was created.  The covenant is, in effect, a rule of the Members’ club to which they all voluntarily subscribe.  The “club” was established relatively recently, in 1984, and some 30 years later units are still being purchased in the knowledge of and faith in the covenant and in the expectation that it will be complied with.  On a 60% turnout, a majority of the residents expressed their objection to the application and mandated LCMC to object.  The remaining covenants were designed to ensure effective transmission of the restriction, to maintain good order and estate management.  If this restriction goes, then the essential purpose and character of the “club” will be seriously eroded.   This factor is also a “key material circumstance” to be taken into account.  In the light of these submissions, it was argued that the scheme of private rights and obligations which still subsists should prevail.
94.	It was submitted that the burden of proof falls upon the applicant to persuade the Tribunal that if he is successful, on the balance of probabilities few others are likely to follow.  This would be a difficult hurdle to cross as, not only would the hard-core of 10 permanent livers-in feel vindicated, but many others who live there all but permanently and find the requirement to move out during the closed period inconvenient and disruptive could well decide to make their own, or joint, applications.   Then there was the risk that those who bought their units purely for holiday purposes would themselves become disgruntled and, thinking that their holiday home was likely to be degraded by more and more full-time occupiers would then want to sell – and those sales would most likely be to people who wish to occupy as their main home.  The whole market, and the character of the site would then, over a period of time, change.                  
95.	It was clear from his responses to questions asked by Mr Cottle in cross-examination that by the removal of the reference to holiday and/or leisure use from the proposed modification and the removal of the restriction on daytime occupation during the restricted periods that Mr Hawkins was worried about the value of this particular restrictive covenant being somewhat eaten away.  Hence LCMC’s insistence on the remaining part relating to overnight occupation during the restricted periods remaining in place, as it was clear that was the only way of preventing this becoming a normal, fully unrestricted, housing estate.  I have considerable sympathy with his concerns and do not accept Mr Cottle’s argument that only a few (a maximum of 20) owners would follow suit.  Whilst in the short term that might well be the case, I find I am altogether more persuaded by Mr Jones’s arguments on the thin end of the wedge situation.   
96.	The position taken by this Tribunal on the thin end of the wedge argument was explained in Re Snaith and Dolding (1995) 71 P & CR 104 where the former President, HH Judge Marder QC said (at 108): 
“The position of the Tribunal is clear.  Any application under section 84(1) must be determined upon the facts and merits of the particular case, and the Tribunal is unable to bind itself to a particular course of action in the future in a case which is not before it: see Re Ghey and Galton and Re: Farmiloe.  It is however legitimate in considering a particular application to have regard to the scheme of covenants as a whole and to assess the importance to the beneficiaries of maintaining the integrity of the scheme...
Insofar as this application would have the effect if granted of opening a breach in a carefully maintained and outstandingly successful scheme of development, to grant the application would in my view deprive the objectors of a substantial practical benefit, namely the assurance of the integrity of the building scheme.   Furthermore, I see the force of the argument that erection of this house could materially alter the context in which future applications would be considered.”
97.	Whilst that case referred to a “carefully maintained and outstandingly successful” building scheme, I am of the view that precisely the same principles apply here.   On the facts and merits of this particular case I am entirely satisfied that the ability of the company to impede the applicant’s proposed full time use of his property constitutes a practical benefit of substantial value or advantage for all the reasons that Mr Jones set out in his closing submissions, and which it is not necessary to repeat at length here.
98.	Suffice to say that despite all of Mr Cottle’s arguments I am certain that, as I said above, whilst there would be unlikely to be an instant effect upon the overall character of the site, the implications of there potentially being a large number of people wanting to follow the applicant’s lead are severe.  I am mindful of the fact that although the applicant garnered a reasonable level of support, there was a significant majority of those who voted (116 for and 51 against) in favour of the company lodging a formal objection.   Whilst that was not a majority of the total number of Members who were entitled to vote, it was significant proportion and was certainly not indicative of there being a major desire amongst owners for change.   
99.	Although it is clear that the Company may have difficulty in raising the required level of funding, to be in a position to move forward with its plans for tidying up the area formerly occupied by the leisure facilities, and undertake a further scheme of development (to which Mr Hawkins said similar restrictive covenants would be applied), I am satisfied that the steps he referred to in planning and designing such a scheme seem appropriate.  I accept his evidence on the potential pitfalls and problems that could well arise if the application succeeds and determine therefore that the application under ground (aa) must fail. 
100.	That being the case, the application under ground (c) must also fail, as it will be evident from my conclusions that I consider if granted, injury to the beneficiaries of the restriction would be caused.            
101.	Finally, with the applicant having failed to make out any of the grounds upon which he sought to rely, the question of compensation under section 84(1) of the Act, to which counsel both referred in their skeleton arguments, does not arise. 
102.	The application to discharge the covenant therefore fails, but in the light of the objector’s concession, I grant the modification in the terms suggested.  The restrictive covenant shall therefore be modified to:
“Not to occupy or allow the bungalow to be occupied between 5pm and 10am on any day during the periods from 15th November to 19th December and 4th January to 14th February in any one year.”
103.	This determines the substantive issues and the parties are now invited to make submissions on costs.  A letter accompanying this decision sets out the procedure for so doing.

							DRAFT 3 March 2015 [Amended 5 March 2015]

							P R Francis FRICS