Newton Poppleford and Harpford Parish Council v Winifred Preston & Anor

Introduction

1. On 1 August 1983 Mr George Compton, a successful local builder and parish councillor, gifted a small parcel of land on the west side of School Lane in the village of Newton Poppleford in Devon to the Newton Poppleford and Harpford Parish Council for use as a doctors’ surgery. The Parish Council built the surgery, as it had agreed to do in the Transfer from Mr Compton, and for almost forty years the building served the village well. But in 2022 the medical practice which had operated from the surgery moved out and no doctor has since been found who wishes to use the building as a surgery.

2. The surgery is a small single storey building containing a waiting room and one consulting room. The Parish Council wants to retain it for the benefit of the village. Since no doctor can be found to occupy it, it would like to find a provider of some other service, related to medicine or health, to take it over. But when Mr Compton gifted the surgery to the Parish Council in 1983 the Council entered into a covenant with him: “Not at any time to carry on or permit to be carried on upon the land hereby transferred any trade or business whatsoever or to use any building erected or to be erected upon the land thereby transferred or permit the same to be used for any purpose other than as a Doctors Surgery” The covenant continues to bind the land and prevents its use for any purpose other than as a doctors’ surgery.

3. The Parish Council now asks the Tribunal to exercise its power under section 84(1) , Law of Property Act 1925 , to modify the covenant to permit the use of the surgery “for any other medical or health service” (the original formulation referred ambiguously to “quasi-medical or health services”, but I permitted the alternative wording suggested by Mr Woolf in his submissions). The Council say that the existing restriction should be deemed to be obsolete and should be widened to enable the surgery to be brought back into use for other reasonable purposes.

4. Land adjoining the surgery belongs to Mrs Winifred Preston, who, together with her late husband, Mr Basil Preston, acquired it from Mr Compton. Mrs Preston and her son, Mr John Preston, were admitted by the Tribunal as objectors to the application.

5. At the hearing of the application the Parish Council was represented by Mr Steven Woolf. Mr Preston spoke on behalf of himself and his mother and I also heard from their lay representative, Mr Robert Compton. Mr Compton is one of the sons of George Compton, the original donor of the surgery to the Parish Council. Along with three other members of his family he filed an objection of his own to the application but neither he nor the other members of the Compton family were admitted by the Tribunal as parties to the proceedings because, unlike the Prestons, they own no land which has the benefit of the covenant. Nevertheless, the Compton family members would like the surgery to be returned to them if it can no longer be used for its original intended purpose. The statutory provisions

6. Section 84(1) of the Law of Property Act 1925 gives the Tribunal a discretionary power to discharge or modify restrictions affecting land, where certain grounds in section 84(1) are made out. The Parish Council relies on grounds (a) and (aa).

7. Ground (a) applies where the Tribunal is satisfied: “that by reason of changes in the character of the property or the neighbourhood or other circumstances of the case which the Upper Tribunal may deem material, the restriction ought to be deemed obsolete.”

8. So far as is material, ground (aa) applies where, in the circumstances described in subsection (1A), the continued existence of the restriction impedes some reasonable use of the land for public or private purposes. Subsection (1A) provides as follows: “Subsection (1)(aa) above authorises the discharge or modification of a restriction by reference to its impeding some reasonable user of land in any case in which the Upper Tribunal is satisfied that the restriction, in impeding that user, either — (a) does not secure to persons entitled to the benefit of it any practical benefits of substantial value or advantage to them; or (b) is contrary to the public interest, and that money will be an adequate compensation for the loss or disadvantage (if any) which any such person will suffer from the discharge or modification.”

9. If the Tribunal is persuaded to modify or discharge a restriction, it has power under section 84(1) to direct the payment of consideration to anyone entitled to the benefit of the covenant to make up for any loss or damage they may suffer as a consequence, or to make up for any effect which the restriction had, when it was imposed, in reducing the consideration received for the land affected by it at that time.

10. Finally, section 84(7) provides that: “… this section does not apply where the restriction was imposed on the occasion of a disposition made gratuitously or for a nominal consideration for public purposes”.

11. Before examining the Parish Council’s case on grounds (a) and (aa) I must first be satisfied that section 84 applies to the covenant. That requires consideration of section 84(7) . Was the covenant imposed on the occasion of a disposition made gratuitously?

12. Where section 84(7) applies the Tribunal has no power to modify or discharge the restriction. In Re Plumpton Parish Council’s Application (1962) 14 P & CR 234, a donor had conveyed land to a Parish Council as a gift for the purpose of erecting a memorial hall. Forty years later the memorial hall had fallen into disrepair and the Council wished to sell it off for redevelopment and to use the proceeds to carry out other improvements to the village. Nobody objected to that proposal but the land was subject to a covenant imposed by the original donor which prevented its use for any purpose other than as a village hall. The President of the Lands Tribunal, Sir William Fitzgerald QC, was reluctantly forced to the conclusion that section 84(7) prevented him from discharging the covenant. The disposition had been made gratuitously for public purposes so, no matter how desirable the project may have been, the Tribunal had no power to remove the restriction, as section 84 did not apply.

13. There is no great technicality in section 84(7) . A “disposition” simply means a disposal or transfer, and the Transfer of the land by George Compton to the Parish Council on 1 August 1983 was clearly a disposition. The Transfer was for public purposes, so that the land could be used by the Parish Council as the site of a new surgery for the village. That is apparent both from the inclusion of the covenant in the Transfer itself, but also from the minutes of the Parish Council at the time. These show discussion of the need for a doctors’ surgery in view of a substantial growth in population which was anticipated, and record Mr Compton’s proposal to donate the land to the Parish Council so that it could be used for that purpose.

14. The question then is whether the transfer was made “gratuitously or for a nominal consideration”. Gratuitously means free of charge. Nominal consideration means a sum of money or other consideration so small that it can never have been intended to be collected: Midland Bank Trust Co. v Green [1981] AC 513 , 532C. A peppercorn rent reserved by a long lease would be an example of nominal consideration: it is consideration in name only.

15. George Compton did not receive any payment for the land when he transferred it to Parish Council. Does that mean that the disposition was made gratuitously? Mr Woolf argued that it did not, and that the Parish Council had made commitments and provided benefits in return for the land which mean that the disposition was not gratuitous and that section 84(7) does not apply.

16. Mr Woolf listed almost all of the terms of the Transfer and sought to portray them as benefits to Mr Compton. These included elements which could not conceivably convert a gratuitous disposition into one made for more than nominal consideration. The rights reserved for the benefit of the Transferor in the First Schedule of the Transfer were not rights which the Parish Council conferred on Mr Compton; they were rights which Mr Compton already enjoyed as owner of the land and which he reserved, or held back, for his own benefit when he transferred the land to the Council.

17. The same is true of the rather technical declarations in clause 4, which provided that the Transferee was not to be entitled to any right of light or air which might prejudicially affect the unrestricted use of any adjoining land belonging to the Transferor, and of clause 5, by which the Transferor retained the right to release covenants he had imposed on adjoining land and remained free to divide up and develop his remaining land as he chose. None of these were benefits provided by the Parish Council to Mr Compton, or to anyone else for that matter, and they would not have prevented the disposition from being gratuitous.

18. Nor would most of the Transferee’s covenants in the Fourth Schedule on which Mr Woolf also relied. I will return to paragraph (a) shortly, but the remainder of this Schedule does not oblige the Transferee to do anything but instead comprises agreements that it would not do certain things on the land transferred to it. These include building or making alterations, except in accordance with plans approved by Mr. Compton; building above one storey; parking a caravan or boat on the land; causing a nuisance to adjoining owners or using the land as part of a road. It was in this group of covenants that the Transferee agreed not to carry on a trade or business on the land, and not to use it other than as a doctors’ surgery. None of these conferred on Mr Compton rights to which he was not already fully entitled as owner of the land being transferred. They had not been the Parish Council’s to give in the first place, so they did not prevent the Transfer from being gratuitous.

19. More promising for Mr Woolf’s argument are the covenants in the Third Schedule and in paragraph (a) of the Fourth Schedule. The covenants in the Third Schedule require the Transferee to do three things: first, to pay a sixth of the cost of laying, repairing and maintaining services such as sewers and drains, used or to be used in common with any adjoining and neighbouring property; secondly, to maintain trees or hedges planted on the land as required under the terms of any planning permission, and to allow Mr Compton to enter to plant trees or hedges; and thirdly, to erect and maintain a fence along the boundaries of the land between points marked on the Transfer plan.

20. One of the covenants in the Fourth Schedule, made for the benefit of the remainder of the Transferor’s Estate on the West side of School Lane, is also significant. Paragraph (a) provides that: “The Transferee shall within three years from the 9th day of December 1982 erect and complete on the land hereby transferred a single storey Doctors Surgery subject to detailed planning approval being given by the Planning Authority.”

21. Mr Woolf submitted that each of these obligations was a benefit to Mr Compton which meant that the disposition by him was not made gratuitously. What Mr Compton gained by the Transfer was not a monetary sum, but it was, Mr Woolf suggested, of considerable value to him as a resident of the Parish and as a local developer.

22. Mr Woolf’s focus on the receipt of benefits by Mr Compton seems to me to miss the point. Whether the promises made by the Parish Council were of benefit to Mr Compton is irrelevant when considering whether the Transfer was gratuitous. It is not the receipt of a benefit by one party to a transaction which prevents it from being gratuitous, it is the fact that the other party incurs a cost or assumes a liability or obligation which enables them to say that they have given something in return for what they have received. If a seller transfers land to a buyer in return for a donation to the seller’s favourite charity, the transfer is not gratuitous although the seller does not benefit from the transaction.

23. When it received the land from Mr Compton, the Parish Council entered into significant obligations. The greatest of these was the obligation to build the doctors’ surgery within three years, but others involving future works and payments were also important to the character of the transaction. For the purpose of section 84(7) a distinction can be made between a negative obligation, that the recipient of the land will not behave in a certain way on the land which is being transferred to it, and a positive obligation to incur expense or do something, whether on that land or elsewhere. In my judgment the former obligation would not prevent a disposition from being gratuitous, but the latter would.

24. This conclusion accords with the view of Harman J in City of Westminster v Duke of Westminster (1991) 23 HLR 174 in finding that section 84(1) applied to covenants in a lease of land by the Duke of Westminster to the City Council for the purpose of providing “dwellings for the working classes”. The lease was for a term of 999 years and reserved a nominal rent of one shilling a year. A development known as the Grosvenor Housing Scheme comprising 604 dwellings had been erected on the land before the commencement of the lease, and the Council covenanted in the lease to maintain and insure them. The Judge had no difficulty, at page 184, in accepting that because of the obligations imposed on the Council by the repairing and insuring covenants (but not because of contributions it had made to the original building costs), the disposition of the land was not gratuitous and that the Lands Tribunal would therefore have jurisdiction to modify the covenants restricting its use.

25. For these reasons I am satisfied that the Transfer of 1 August 1983 was not a gratuitous disposition of the land on which the surgery was built. Section 84(7) does not apply, and the Tribunal will be able to modify the covenant at paragraph (c) of the Fourth Schedule, if one of the statutory grounds is made out. Ground (a) – Is the restriction obsolete?

26. I heard evidence from Mrs Susan Tribble, Chair of the Parish Council, who confirmed its written case and explained that the medical practice which had previously provided services from the surgery no longer wished to do so after 2022. She had approached other local practices, but none was interested in setting up in the village, so the building had remained empty and a drain on the Parish Council’s resources for more than three years. The Council had received a number of inquiries from healthcare professionals including a chiropractor and an audiologist, who had expressed an interest in operating clinics from the building. She saw no prospect of the building ever being used as a doctors’ surgery but hoped to attract one or more of such ancillary health practitioners. The building could also be put to other uses of benefit to the village community, such as providing premises for a vet or even an office for the Parish Council’s clerk but these were beyond the scope of the modification requested in the current application.

27. Mr Compton took issue with the efforts made by the Parish Council to attract a medical practice and suggested that a better response might be obtained if the building was offered free of charge. He also questioned the need for the services which it was hoped to attract to use the building and objected to the fact that they would be provided at a cost to villagers, rather than as a free service provided by the NHS.

28. I have no difficulty in accepting Mrs Tribble’s evidence. Mr Compton added to the picture by explaining that the medical practice which previously operated from the building had consolidated into much larger premises in Sidmouth at which it was able to offer a wider variety of medical and ancillary services. Mr Compton’s optimism that the building might be attractive to a medical practice if offered on more generous terms seemed to be no more than wishful thinking.

29. Mr Woolf did not suggest that the restriction had become obsolete by reason of any change in the character of the property or the neighbourhood but instead relied on what he suggested was a material change of circumstances since 1983. There was no longer any demand for the building to be used as a doctors’ surgery, and no real prospect that it would ever be used for that purpose again. That, he suggested, was sufficient to enable the restriction to be deemed obsolete.

30. I do not accept Mr Woolf’s submission on this aspect of the case.

31. A restriction does not become obsolete simply because nobody can be found who is interested in using the land for the only purpose for which the restriction permits it to be used. A restriction becomes obsolete when it no longer serves any practical purpose, either because the restriction has been broken or disregarded to such an extent that it has ceased to be enforceable, or because the circumstances in which it was imposed have changed to such an extent that the achievement of the original purpose has become impossible.

32. The restriction in this case prevents the use of the building for any trade or business or for any purpose other than as a doctors’ surgery. There is no suggestion that the covenant which imposed the restriction has ever been broken and there is no practical difficulty in its continued observance. On the contrary, Mrs Tribble confirmed that the Parish Council had not followed up the various enquiries it had received because of objections from Mr Compton that permitting any use of the building other than as a doctors’ surgery would be a breach of the covenant. If the covenant was broken it is likely that those with the benefit would be able to obtain an injunction to enforce it. The covenant did not guarantee that a surgery will always be available, and the purpose for which it was imposed can be, and is being, achieved. That purpose was a negative one, the prevention of any use other than as a doctors’ surgery. In my judgment the restriction is not obsolete. Ground (aa) – Does the restriction impede some reasonable use of the land without securing any practical benefits?

33. There was no dispute that the proposed use of the land was reasonable. Mr Preston and Mr Compton agreed that ancillary health services, such as audiology, osteopathy, vaccination clinics and so on, are all services which might be provided by a larger doctors’ surgery, such as the surgery at Sidmouth which Mr Compton described to me. They did not object to the provision of those services, although they questioned the need for them to be provided in the village given that they are available elsewhere. Their objection was not to the uses which the Parish Council hopes to attract, but to the principle that the covenant imposed by Mr Compton’s father should be varied at all.

34. I am satisfied that the additional or ancillary health services described in the evidence are reasonable uses of the building. Had the building been larger, they are the sort of services which might be provided from a doctors’ surgery. The assumption made by both sides in this case has been that the provision of such services as a free-standing use of the building, independent of any doctors’ surgery carrying on from it, would be a breach of the covenant. I agree. If the building was being used as a doctors’ surgery, there could be no objection to the provision of those ancillary services as part of that use. That is a further indication that such uses are reasonable.

35. Mr Preston did not suggest that the continuation of the restriction secures any practical benefits of substantial value or advantage to him or his mother. He explained that he lives in the village, in a house adjoining the surgery, but he is registered with another medical practice in the area and had never been inside the surgery building. He was concerned that if the covenant was removed altogether the building might be used for some entirely different purpose, such as for a restaurant, but he did not mention any benefit he or his mother derived from the fact that other health services could not make use of it.

36. Mr Compton does not live in the village, although he does live in the Parish. He does not have the benefit of the restriction. His greatest concern was to prevent the Parish Council from disregarding the terms of his father’s gift, but he did not identify any practical benefit which the current prohibition on wider health services being provided from the building secured for him or for anyone with the benefit of the restriction.

37. This is a case in which ground (aa) is clearly made out. The restriction impedes the use of the land for ancillary medical or health services, but in doing so it confers no practical benefits on those entitled to enforce it. Those are precisely the circumstances in which Parliament intended the Tribunal to have the power to discharge or modify a restriction. Discretion – Should the power to modify the restriction be exercised?

38. Section 84(1) confers a discretionary power on the Tribunal. If it is satisfied that one of the grounds is made out, the Tribunal “may” discharge or modify the restriction. In every case where one of the grounds is made out, the Tribunal must ask itself whether the power should be exercised.

39. When the Tribunal is deciding whether to exercise its discretion, section 84 (1B) specifies a number of matters which it must take into account. These include the statutory development plan and any pattern of planning permissions granted or refused in the relevant area, but also the period and context in which the restriction was created or imposed, and any other material circumstances. There is no relevant planning context in this case, but the circumstances in which the restriction was imposed are very relevant and they form real basis of the objectors’ case.

40. Mr Compton emphasised his father’s generosity in providing the land on which the surgery was built without charge. It was valuable land, as Mr Compton senior had recently succeeded in obtaining planning permission to build five new houses on a much larger area which included it. The land would not have been big enough to enable an additional house to be built but had it not been given to the Parish Council it might have been used to enlarge one of the five or been incorporated into one of the gardens. The Council had had the opportunity to purchase the surgery land before Mr Compton’s father did, but it had lacked the funds to do so.

41. Mr Compton is clearly offended by what he sees as the Parish Council’s disregard for the terms of the original transfer. He interpreted his father’s intentions narrowly and suggested that if it had been his intention that other uses could be made of the land, even other medical uses, that would have been spelled out in the Transfer. It was not acceptable to him that the land his father intended as a doctors’ surgery should be used for any other purpose, particularly for any purpose for which the Parish Council would receive payment. If the Parish Council could not make good use of the building while complying with the original restrictions Mr Compton considered that it should return the land to the Compton family.

42. The approach taken by Mr Compton and Mr Preston might have attracted the sympathy of some Judges. In the Westminster case, the City Council wished to free itself of the covenant in the lease it had been granted without payment of a premium in 1937 which required that 604 residential flats should be used only “as dwellings for the working classes”. Harman J was asked to determine issues about the meaning of the covenant and about the availability of the section 84 procedure, and it was not for him to consider whether the covenants should be modified or discharged, those were matters for the Lands Tribunal. But the Judge gave a very clear indication of where his sympathies lay: “I cannot resist adding that it seems to me that it would lie very ill in the mouth of the City of Westminster to blow hot and cold in the way it would be doing if it were to make an application to the Lands Tribunal. It received a great benefit from the Second Duke, and it seems to me extremely unattractive to take a gift, made upon conditions known and agreed to at the time of the gift, and then turn round and seek to discharge those very conditions fixed as part of the bargain, in this case a Parliamentary contract between the parties. That. however, would be a matter for the Lands Tribunal to consider in exercising its own discretion.”

43. The Parish Council wishes to do in this case what the City of Westminster proposed to do in relation to the Grosvenor Housing Scheme by modifying the terms of the bargain it had been happy to make with a generous donor. The fact that it was the Parish Council itself which entered into the original agreement is a factor to be weighed in the balance, as it is whenever the original covenantor seeks the assistance of the Tribunal under section 84(1) . But even bearing that factor in mind, the circumstances of this case do not provoke in me the same sense of outrage as Harman J appears to have experienced. The building is lying unused and unusable, unless the covenant is modified. It is an expense to the Parish Council, which must at the very least insure it, and something of a burden to those Councillors, like Mrs Tribble, who periodically inspect it and respond to inquiries about its future. Meanwhile it is providing nothing of any benefit to the village. From what Mr Compton told me of his father’s generosity and of his desire to provide something useful for his fellow parishioners, I find it impossible to believe that he would have baulked at the very modest change to the original bargain which I am being asked to make. No harm will come to Mr and Mrs Preston as a result of the change, and some good may eventually be done to those whom Mr Compton senior wished to benefit. The alternative is waste and eventual dereliction which would be of no advantage to anyone.

44. Taking all these matters into account I am very easily persuaded that I should exercise the Tribunal’s jurisdiction to modify the restriction.

45. Although the Prestons included a claim for compensation in their notice of objection to the application, it was not suggested that they would suffer any loss or damage if the covenant was modified. Nor do I think it is appropriate to award compensation to make up for any effect which the restriction had, when it was imposed, in reducing the consideration received for the land in 1983. There is no reason to think Mr Compton senior would have been any less generous, or would have require payment, if the original Transfer had included a covenant in the modified form set out above.

46. For the reasons I have given I will make the modification sought without requiring payment of compensation. The restriction in paragraph (c) of the Fourth Schedule of the Transfer of 1 August 1983 by George Raymond Compton to the Parish Council of Newton Poppleford and Harpford will now read as follows: “Not at any time to carry on or permit to be carried on upon the land hereby transferred any trade or business whatsoever or to use any building erected or to be erected upon the land hereby transferred or permit the same to be used for any purpose other than as a Doctors Surgery or for any other medical or health service” Martin Rodger KC, Deputy Chamber President 12 February 2026 Right of appeal Any party has a right of appeal to the Court of Appeal on any point of law arising from this decision. The right of appeal may be exercised only with permission. An application for permission to appeal to the Court of Appeal must be sent or delivered to the Tribunal so that it is received within 1 month after the date on which this decision is sent to the parties (unless an application for costs is made within 14 days of the decision being sent to the parties, in which case an application for permission to appeal must be made within 1 month of the date on which the Tribunal’s decision on costs is sent to the parties). An application for permission to appeal must identify the decision of the Tribunal to which it relates, identify the alleged error or errors of law in the decision, and state the result the party making the application is seeking. If the Tribunal refuses permission to appeal a further application may then be made to the Court of Appeal for permission.