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Bath Rugby Ltd v Greenwood & Ors v Bath Recreation Ltd [2021] EWCA Civ 1927

Tuesday 21 December 2021

On 21 December 2021, the Court of Appeal handed down judgment in this case concerning the enforceability of a pre-1925 Act restrictive covenant.  The court has allowed the appeal, overturning the judgment of HHJ Matthews (sitting as a Judge of the High Court) dated 13 October 2020.

Martin Hutchings QC and Harriet Holmes (instructed by Clarke Willmott LLP) acted for the successful second appellant and intervener, Bath Recreation Limited.

The case concerned a covenant entered into in a conveyance dated 6/4/1922 of the Recreation Ground in Bath, a large open space which was formerly part of the Bathwick Estate, and part of which has been the home of Bath Rugby since about 1896.

Bath Rugby, as tenant of part of the Recreation Ground, had sought a declaration pursuant to s.84(2) of the 1925 Act that the covenant in question was not enforceable.

The court below  decided that the covenant was enforceable on the basis the covenant had been annexed to ‘adjoining land or the neighbourhood’ as referred to in the conveyance, which could be interpreted as a reference to ‘buildings and land of the vendor…adjoining or near to’ the conveyed land.

The court of appeal disagreed, deciding instead that there must be a ‘sufficient indication’ of the land intended to be benefited by the covenant, either expressly or by necessary implication, and, crucially, that the words ‘adjoining land or the neighbourhood’ were neither sufficient, nor could they be construed in the artificial way that the Judge below had done. This was particularly so in the context of the restrictive covenant itself, which prevented nuisance and annoyance etc, given that the words ‘adjoining land or the neighbourhood’ were more apt to describe the area that the prohibited activities were not to affect, rather than being a description of the benefited land.

The decision is one of both legal and practical significance.  For lawyers practising in this field, it provides consideration and clarification of matters relating to the annexation of both pre and post 1925 Act covenants and some noteworthy disagreement between members of the court about whether a condition of annexation for such covenants, is that the land intended to be benefited by the covenant has to be ‘easily ascertainable’.  As for the practical significance of the decision, it may well make the difference between the Bath Rugby club being able to remain on the Recreation Ground as the club looks to redevelop its now out-dated stadium.

Some might say, therefore, that the judgment is a welcome Christmas present for fans of Bath Rugby and those who would like the Recreation Ground to continue providing an open space for recreational purposes.

A copy of the full judgment may be found here.