Elliston v Reacher [1908] 2 Ch 374

Facts

• The case involved a dispute over the enforceability of restrictive covenants imposed on properties within a residential development.
• The plaintiffs sought to enforce these covenants against the defendants, who were alleged to have breached them by constructing a building in violation of the restrictions.
• The covenants were designed to maintain the uniform character and integrity of the development area through a building scheme.
• The court examined whether the covenants were part of a valid building scheme and if they were enforceable against subsequent purchasers.
• The evidence addressed whether the scheme’s area was clearly defined, if the original vendor imposed the restrictions, if the covenants benefitted all plots, and whether purchasers were aware of mutual enforceability.

Issues

1. Whether the restrictive covenants formed part of a valid building scheme.
2. Whether the covenants were enforceable against subsequent purchasers within the designated area.
3. Whether all statutory and evidential requirements for building scheme enforceability were satisfied.

Decision

• The court held that the four critical conditions for a valid building scheme had been established.
• It found a clearly defined area to which the scheme applied.
• The covenants had been imposed by a common vendor as part of a unified plan for the development.
• The restrictions were intended to benefit all plots within the designated area.
• Purchasers had constructive notice of the mutual enforceability of the covenants as they were recorded in the deeds.
• As all four conditions were fulfilled, the covenants were enforceable against the defendants and subsequent purchasers.

Legal Principles

• A valid building scheme, enabling enforcement of restrictive covenants, requires:
  • A precisely defined area subject to the scheme.
  • The imposition of covenants by a common vendor.
  • Clear intention that the restrictions benefit all plots within the area.
  • Purchasers' awareness of the mutual enforceability of the covenants.
• These conditions ensure that covenants bind not only the original parties but also subsequent purchasers, upholding the integrity and uniformity of developments.
• The enforceability of building schemes relies on proper drafting and documentation, making the parties’ intentions and the scope of the scheme clear.

Conclusion

Elliston v Reacher [1908] 2 Ch 374 established the authoritative standard for the enforceability of restrictive covenants in building schemes, requiring a defined area, a common vendor, intention to benefit all plots, and purchaser awareness, thus ensuring that such obligations are binding within property developments.