Small v Oliver & Saunders (Developments) Ltd [2006] 3 EGLR 141
Property law – Restrictive covenants – Damages
Facts
The claimant owned a house next to the defendant who was a housing developer. The developer had two pieces of planning permission approved for the development of land. The first was to build a new house, behind their plot of land and the other was to demolish the existing property that resided on the land. Sometime later, once the existing property had been demolished and construction was well underway on the new build property and road, the claimant submitted that he was owed a benefit of the restrictive covenant which restricted the use of the land and claimed for an injunction and/or damages.
Issue
The issue for the court to establish in this case was whether the claimant could exercise the benefit of the covenant that touched the property. The court was required to first establish whether the covenant had been annexed to the property. If this could be proven, the court had to consider whether an injunction or damages were appropriate in the circumstances, particularly as there had been a significant delay in the plaintiff bringing the action.
Decision/Outcome
The court held that the claimant had the benefit of the covenant on the property and that this had been annexed in the original conveyancing in 1925.To this end, the use of the land for the access to the houses on the land breached the covenant. Damages were awarded to the claimant and these were based on the amount of money that would have reasonable been negotiated between the parties. The payment of the damages allowed for relaxation of the covenant and allowed future access to the house in question.
Updated 21 March 2026
This case summary remains broadly accurate as a description of the 2006 judgment in Small v Oliver & Saunders (Developments) Ltd [2006] 3 EGLR 141. The decision is an example of the court applying the principles from Wrotham Park Estate Co Ltd v Parkside Homes Ltd [1974] 1 WLR 798 to award negotiating damages (sometimes called Wrotham Park damages) rather than granting an injunction for breach of a restrictive covenant.
Readers should be aware of one significant subsequent development in this area. The Supreme Court in One Step (Support) Ltd v Morris-Garner [2018] UKSC 20 clarified the basis for awarding this type of gain-based or negotiating damages, confirming they are available where it would be just and equitable to award a sum reflecting what the parties would hypothetically have negotiated, but placing limits on when such awards are appropriate. This does not undermine the outcome in Small, but students should read it alongside the Supreme Court’s later guidance when studying the remedy of negotiating damages. The underlying principles on annexation of the benefit of restrictive covenants, as applied in the case, remain good law.
