Property developers and owners need to determine if their land is affected by any restrictive covenants before developing or conducting works on the land or property.
What is a Restrictive Covenant?
A restrictive covenant is an agreement that restricts the use or enjoyment of a landowner’s land and how the land may be developed.
A covenant remains enforceable regardless of any change in ownership. It will continually affect the land until it is removed, changed or has lapsed (the covenant has reached its end date.
The most common restrictive covenants include:
- Material restrictive covenants – these covenants prescribe or prohibit the use of particular construction material
- Single dwelling restrictive covenants – these covenants prevent the construction of a second dwelling or a further subdivision of a lot
- Use-related restrictive covenants- these covenants limit the use of a lot. For example, a commercial property may not be used for residential purposes.
How do I remove a Restrictive Covenant?
Apply to the Supreme Court of Victoria
Where one or more holders of the restrictive covenant is likely to oppose to the removal, an application to remove a restrictive covenant may be made to the Supreme Court. This generally involves filing court documents with the Supreme Court, accompanied by planning documents to support the removal.
The removal of a restrictive covenant under this approach is subject to the discretion of the Court and is not entirely guaranteed.
Request to amend the planning scheme
Alternatively, an application to remove a restrictive covenant by amending the planning scheme may be lodged. The amendment must be prepared by a planning authority, such as a local council, and have relevant approvals.
Apply for a planning permit to remove or vary the restrictive covenant
An application may be made for a planning permit that allows for the removal of a restrictive covenant.
For the permit to be granted, the relevant authorities (i.e. Council or Minister) must be satisfied that the landowner benefiting from the land will not likely suffer any financial loss, loss of amenity or any other material detriment due to the removal.
This approach is not often recommended as many applications fall through due to the many requirements to be met by the applicant.
A restrictive covenant can be removed if all benefiting landowners of the covenant reach a mutual agreement. The agreement is required to be registered with the Victorian Land Registry.
This approach is efficient if all benefiting landowners can be identified and is recommended in limited circumstances.