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Clause 90—(Power To Discharge Or Modify Restrictive Covenants Affecting Land)

Volume 155: debated on Wednesday 14 June 1922

The text on this page has been created from Hansard archive content, it may contain typographical errors.

(11) Where a term of more than one hundred years is created in land (whether before or after the commencement of this Act) this Section shall, after the expiration of fifty years of the term, apply to restrictions affecting such leasehold land in like manner as it would have applied had the land been freehold.

I beg to move, in Sub-section (11), to leave out the words "one hundred," and to insert instead thereof the word "ninety."

This Clause deals entirely with the question of restrictive covenants. I think it will be admitted by most people that in the great majority of cases restrictive covenants are as much in the interests of the community as in the interests of the landlord, and that refers more especially to covenants which have to do with the question of nuisances or insanitary surroundings. Indeed, I think it may well be said that in such cases the interests of the tenant and of the landlord are identical. However beneficial restrictive covenants may have been when they were originally proposed, it is quite possible that, by the lapse of time, or by the altered conditions of a locality, the need for those restrictive covenants has gone by, and, instead of being a benefit, they are actually against the interest of a locality's development. There are many people who, welcoming this Bill as a whole, noticed almost with dismay that the word "freehold" had been inserted in the Bill, therefore cutting "leasehold" out of this Clause.

Therefore, we welcome the Amendment which the learned Solicitor-General moved in Committee by inserting Subsection (11). We thank him for it. We who have been for a long time in this House with him know how interested he has always been in these matters, and how sympathetic he has been to those who wish to remove anomalies and real injustices in this leasehold system. But the Amendment he moved in Committee only touches a fringe of the problem. In my own constituency of Southport the vast majority of leases are under 100 years, being 99-year leases, and that applies also to Liverpool and many other towns. I should like it to be understood that my Amendment is intended to operate only in cases where covenants have become obsolete or injurious. I think the interests of the landowner will be amply safeguarded under the Clause, and I hope my hon. and learned Friend may see his way to accept the Amendment. I am sure that by doing so he—and, I may say, incidentally, the Government—will receive the gratitude, not only of a very large number of municipal authorities, but, I think I may say also, of millions of leaseholders throughout the country.

I beg to second the Amendment.

If the learned Solicitor-General accepts this Amendment, it will be of enormous value in towns where, in many oases, restrictive covenants have become obsolete. Restrictive covenants made in the years from 1860 to 1870 not to carry on a particular business, or not to erect a house over or under a certain rental, may have been perfectly fitting then, but circumstances and conditions may have entirely changed, and these covenants may have become obsolete and a burden upon the community. Therefore, I feel sure that, by accepting this Amendment, not only will tenants be enormously benefited, but the development of whole areas in the neighbourhood of towns will be greatly facilitated.

I shall be very glad to recommend to the House the acceptance of this Amendment, subject to conditions I will mention of a minor character. I agree with every word that has fallen from the lips of the hon. and gallant Member for Southport (Lieut.-Colonel D. White) as to the extreme importance of the Amendment. I, personally, would have been glad to accept it when he suggested it in Committee, but there were certain technical difficulties with regard to mining leases that I did not want to go into at that time, and need not go into now. Mining leases and mining questions generally are kept out of this Bill, ac it is the intention of the Government to introduce legislation on mining questions at as early a date as possible. Therefore, what I would ask the hon. and gallant Member to agree to is that, instead of his next Amendment on the Paper, which reads as follows:

"Provided that in the case of mining leases the term shall be more than one hundred years."
he should agree to the phraseology being:
"Provided that this Sub-section shall not apply to mining leases or leases for mining purposes."

On the understanding that the hon. and gallant Member's next Amendment will be moved in that form, I shall be glad to accept this, and to thank him, on behalf of the community to which he has referred, for his pertinacity in regard to this Amendment.

I understand that this will be the effect. Where a person has leased a house for 90 years, and 50 years of that lease have expired, then, even if there are any restrictive covenants in the lease, the leaseholder can use the house in any way he likes, It that so?

The right hon. Baronet has not, I think, appreciated that under Sub-section (11) the power to deal with restrictive covenants in a lease of freehold land is dealt with on the same lines as the power to deal with restrictive covenants in regard to freehold land which you find in the earlier part of the Clause. It is there hedged round with elaborate precautions, and it is there provided that, if a restrictive covenant be got rid of by the tribunal, compensation must be given to the person in whose favour the restrictive covenant has been made, if the covenantee suffers any loss by the removal of the covenant. It is for the purpose of getting rid of restrictive covenants that impede development in a neighbourhood, subject always to the greatest precautions and to compensation.

May I, as a layman, ask this question? Suppose I live in a square in which all the houses have been let for 99 years as dwelling-houses, but, owing to some railway coming near, it is impossible for me to live in that square, will this Clause allow me to let my houses for offices, without being penalised?

If the hon. Member will look at Sub-section (1 a) of this Clause the powers are these:

"The Authority…shall have power from time to time, an the application of any person interested in any freehold land affected by any restriction arising under covenant or otherwise as to the user thereof or the building thereon, by Order wholly or partially to discharge or modify any such restriction (subject or not to the payment by the applicant of compensation to any person suffering loss in consequence of the Order) upon being satisfied
(a) That by reason of changes in the character of the property or the neighbourhood or other circumstances of the case which the Authority may deem material, the restriction ought to he deemed obsolete, or that the continued existence thereof would impede the reasonable user of the land for public or private purposes."
And so on.

I do not think my right hon. Friend the Member for the City of London (Sir F. Banbury) need have any fear of the operation of this Clause. In fact, I am sorry to say he will not have any reason to fear it, because, in my view, it is a pity that we have this much more limited form of application of the Clause than that originally intended, and I would advise the right hon. Baronet to be thankful, from his point of view, that things are not worse. I wish, from my point of view, things were very much better. I regret very much the original proposal has been cut down to the extent it has been. Nobody who knows anything about the tenure of land in urban areas, and, indeed, outside urban areas, both freehold and leasehold—and particularly leasehold—can come to any other conclusion than that many of the restrictive covenants are obsolete, and most disadvantageous, not only to those who own the land, but to the community at large, and it is for the first time that we get in a Statute the application of something approaching commonsense in dealing with these questions. I am not, of course, making any reference to my right hon. Friend in that regard. I welcome this insertion, though it is hedged round with such safeguards that I doubt whether the benefits will be very large. I hope, at some later time, I shall be in this House to give effect to much wider and more sweeping and drastic powers than are contained in this very limited Clause now before the House.

My only objection is that the Clause and the Amendment restrict the application of common sense. The Clause says:

"Where a term of more than one hundred years is created in land."
That, by the Amendment, is going to be altered to
"Where a term of more than ninety years is created in land."
Therefore, people who have a 99 years' lease to start with, will be able to avail themselves of this provision, and if there be some onerous, obsolete, and stupid restrictions applied to their property, they will now have, if we pass this Clause in this shape, some mean;. of going to an authority and getting rid of them under reasonable terms, and if anyone be damnified he will have compensation; but the Clause will leave anyone who has got a. lease of less than 90 years without any remedy whatever, and we in Liverpool have got a vast number of leases of 75 years. I am very sorry to find that, while a reasonable thing is being clone in respect to restrictions of an obsolete character in regard to long leases, my own locality, at all events, is not to get any benefit from this Clause. I shall support this Amendment to make 100 into 90 years, but if anyone would suggest making it 50 or 51 years, so as to cover the period of 50 years, I should be even more glad.

On a point of Order. Would it be possible for me to move as an Amendment to the Amendment, that the period should be sixty years?

7.0 P.M.

It could be done in this way: We must first of all remove "one hundred" from the Bill. Then I shall have to put the Question, "That the word 'ninety' be there inserted." If that be negatived, it will be open to the hon. Member to move the insertion of "sixty" instead of "ninety."

Question, "That the words 'one hundred' stand part of the Bill," put, and negatived.

Question proposed, "That the word 'ninety' be there inserted in the Bill."

I wish to move as a further Amendment, "That the word 'sixty' be there inserted." I have no objection, of course, to the principle involved in the ninety years, but I agree with my hon. Friend the Member for Edgehill (Sir W. Rutherford) that we should prefer to see the term sixty years. For that reason, I move that instead of "ninety" the word should be "sixty."

The House will have to negative the word "ninety." Then a second Amendment will be necessary to insert "sixty." I must first put the Question, "That the word 'ninety' be there inserted."

I have every sympathy with the proposal for a further reduction from ninety years, but one must draw the line somewhere, and I want to say why. We do not want to interfere with a contract freely made within the length of time for which the contracting parties may reasonably have anticipated that the contract as a contract would continue to be effected. Leasehold property, after the lapse of a certain length of time, ceases to have any really contractual character, and it becomes a type of tenure rather than the result of a mere contract or undertaking between parties freely made. We want to draw a reasonable line be- tween the anomaly we see at the present time of leasehold estates, long after the, leases have been created, becoming encumbered by obsolete covenants, and, on, the other hand, freedom of contract.

How can the Solicitor-General reconcile that argument with the limitation of fifty years, on page 74 of the Bill?

I am told that the concession I have already made, down to ninety years, is as far as it is safe to go, for reasons that are known to those who, are concerned with conveyancing matters. I am afraid I must resist a reduction beyond the figure of ninety, though I have a good deal of sympathy with the hon. Member's proposal.

I am sorry the Solicitor-General has stated that he is rather unfavourable to this Amendment. I assure him—if I am right, I may, of course, be wrong—that I do not think there is anything in conveyancing which is objectionable at all. Every possible argument—and I say this with some knowledge of the matter—which can be brought to bear for bringing the operation of this Clause down to the ninety-nine years' lease, is applicable in the fullest sense to the seventy years' lease. The same kind of thing arises in seventy or seventy-five years' lease as in the ninety-nine years' lease. The only thing is, that in those parts of the country where it has-become the custom to grant a seventy-live years' lease instead of a ninety-nine years' lease, when those leases are granted it really does not make much difference to the grantor or the grantee at the time whether it is ninety-nine years or seventy-five years. It is a difference of about twenty years, which is a very, very long time off.

Seventy-five years is a very long time off, when a man grants or takes a lease. The House, therefore, may assume with safety that identical conditions obtain when a seventy-five years' lease is granted as when a ninety-nine years' lease is granted. It is a long lease, applied with that difference of years, in different parts of the country. I assure the Solicitor General that very grave injustice will arise, as between one district and another in the country, if the concession is not given to the seventy-five years' lease as to the ninety-years' lease. You have a district like Cardiff and, as we have been told, like Southport, where the ninety-nine years' lease obtains. You may go to other places within 100 miles or so, and there you find that a seventy-five years' lease obtains.

I have made further inquiries, and I am happy to say that if my hon. Friend (Mr. A. M. Samuel) will make it "seventy" instead of "sixty," I will accept it.

Have I your permission, Mr. Speaker, to withdraw "sixty" and substitute "seventy"?

We are still on the Question, "That the word 'ninety' be there inserted." If the House negative the "ninety," I will take the "seventy."

Question, "That the word 'ninety' be there inserted in the Bill," put, and negatived.

I beg to move, "That the word 'seventy' be there inserted in the Bill."

With your leave, Sir, I will move the insertion of the seventy years in place of the ninety which we have negatived.

Question, "That the word 'seventy' be there inserted in the Bill," put, and agreed to.

Further Amendment made: At the end of Sub-section (11) insert the words

"Provided that this Sub-section shall not apply to mining leases or leases for mining purposee."—[Lieut.-Colonel D, White.]