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Stuart J
Stuart J, Solicitor
Category: Law
Satisfied Customers: 22441
Experience:  PGD Law. 20 years legal profession, 6 as partner in High Street Practice
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If a covenant is in place on a shop on land that forbids the

Resolved Question:

If a covenant is in place on a shop on land that forbids the sale of alcohol and the shop is sold can the new owner just ignore the covenant
Submitted: 3 years ago.
Category: Law
Expert:  Stuart J replied 3 years ago.
Hello, I am Law Denning and I am a practising solicitor. I have been an expert on this website in UK law since 2008. During that time, as you appreciate, I have answered thousands of questions from satisfied users on a variety of subjects.
Because we are all in practice with clients and court and other users, I might not always respond in minutes, particularly evenings and weekends. Please bear with me in that case. I will be online and off-line all day today.

It is my pleasure to try and assist you with this today. Please bear with me while I gather some further information from you in order for me to be able to advise you fully.
What is your interest in this? How long has the covenant been in place for and who put it in place? Has anyone else breached it in the past? Can we have the full background detail please?
Customer: replied 3 years ago.


I took the lease on a shop/Post Office on 13/01/2000 Ii the Lease, issued by the local Council, who owned the Property, there was a clause stating that Alcohol could not be sold from the premises. Apparently a Public House had sood on the land and when it was pulled down in the 1960's the Spirit Licence was transferred by W Nimmo & Sons (Brewery) to a Club some 1 mile away and the Covenant put on the land.


I asked the Local Council to remove the Covenant and was told that it couldn't be done. The Council passed over all its housing/shop portfolio to a Housing Society some 3 years ago however my Lease expired and despite asking was never renewed. I was told to just keep paying my Quarterly Rent. I sold my Business to retire, as I am in poor health, some 8 weeks ago and the new owner has applied, and been granted an Alcohol Licence last week. No mention has been made of the Covenant on the Land. It has never been breached in the past and it seems unfair that for 13yrs I couldnt get a Licence but he has. That Licence would have made a enormous difference in the sale price of my business.


 


 


 

Expert:  Stuart J replied 3 years ago.
Thank you. These covenants are enforceable.
They are also removable by agreement with whoever has the benefit of the covenant.
What you were told is incorrect and you should have taken legal advice at the time.
Very often, people will see the removal of the covenant as a way to make a few hundred pounds and will charge a fee for doing it. It’s a sort of windfall/cash cow.
You don’t know whether the new owner has paid money or indeed removed the covenant.
I have dealt with one recently which was a covenant to put on a piece of land which was previously the site of a chapel. The covenant was put on by the church over 100 years ago in relation to part of the land which was being sold. Ironically enough, it was being sold to the pub to use the car park so we had to try to lift the covenant. It took some while because the original church had long since ceased and it transpired that we could find no one who would take no further the interests of that particular church. We therefore arranged an indemnity insurance to cover the eventuality of someone coming out of the woodwork to claim that the covenant was in breach.
Being granted a liquor licence being granted planning permission either of which might be in breach of the covenant, is immaterial. The planning and licensing authorities have no interest in covenants and that is for the owner of the property to deal with. For that reason, there should have been no reason why you should not have been granted a licence although if the person with the benefit of the covenant wanted to enforce it, your license would obviously be useless.
Of course, the government may not have been extinguished and it may be extant and the new owner is simply ignoring it. In that case, it would be for whoever has the benefit of the covenant to enforce it if they wish. Of course, enforcing the covenant costs money and if they are not bothered, the new owner will simply carry on with impunity. After 20 years, the covenant can be extinguished if it has been breached continually for that time.
I’m sorry, I appreciate that this is not the answer you wanted but there is no point in me misleading you. I have a duty to advise you truthfully and honestly even if that answer is unfavourable.
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Stuart J, Solicitor
Category: Law
Satisfied Customers: 22441
Experience: PGD Law. 20 years legal profession, 6 as partner in High Street Practice
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