Gafford v Graham [1998] EWCA Civ 666; (1999) 77 P & CR 73
Property law – Restrictive covenants – Damages
Facts
The defendant began the construction of an indoor riding school as part of a business that was run on the premises. Restrictive covenants limited the land’s use to a livery yard and stabling, with one residential bungalow, and required written approval of detailed plans before building work. The plaintiff, who owned part of the land benefiting from the covenants, objected before construction of the riding school began in March 1989. He also complained about the conversion of the bungalow and an extension to the barn carried out in 1986. Although he knew his rights, he had not complained to the defendant about those earlier works at the time.
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The plaintiff issued a writ for damages and an injunction. The county court refused to order demolition but granted injunctions restricting the business to the permitted uses and awarded £36,750, including interest. The defendant appealed. The plaintiff cross-appealed for demolition of the riding school.
Issues
The court considered whether the plaintiff had acquiesced in the breaches of covenant, whether injunctions should be granted, and how damages in lieu of an injunction should be assessed.
Decision/Outcome
The court allowed the appeal of the defendant and dismissed the cross-appeal of the plaintiff. The plaintiff’s acquiescence in the 1986 bungalow and barn works barred all relief in respect of those works, and the damages awarded for them were discharged. Knowing his rights, he had treated those matters as closed; it would be unconscionable to enforce them later.
The riding school was different. The plaintiff had objected before construction began, so his rights were not entirely barred by acquiescence. However, his failure to seek an interlocutory injunction was an important reason for refusing demolition. The court recognised that the defendant had acted in blatant and calculated disregard of the plaintiff’s rights. Nevertheless, taking account of the practical difficulties of adapting the building and the plaintiff’s stated willingness to settle for money, it would be oppressive to maintain the prohibitory injunctions. They were discharged and damages awarded instead.
Damages were assessed at £25,000: the sum the plaintiff might reasonably have demanded for relaxing the restrictions permanently to permit the riding school and its business. Interest of £9,375 brought the total to £34,375. Interest covered only 1989–1992 because the plaintiff was largely responsible for the subsequent delay in bringing the action to trial.
