Can vendor of freehold shop impose new user covenant?

[radia]

i am inquiring about buying a shop - the present owner has a shop about 1/2 mile away - now he is insisting that he will place a clause on the freehold sale that booze cannot be sold?!?! is this possible? its my freehold property when the place is sold so how can he put clauses in? he states also if i sell the business this clause is still in place for any other person! is this possible?

[Editor]

Covenants are restrictions imposed on the use of land or property by a former owner. If land or property is subject to covenants, they will be written into the deeds of the property. Covenants once applied will run with the land and the responsibility for complying is passed from one new owner to another.
You need to be fully aware of any restrictions before you buy.

[daveyjp]

It is possible with the relevant covenant, but such a covenant can greatly reduce the market value of the shop and can even make it unsaleable. The vendor probably thinks he is pulling a fast one to protect his other outlet, but doesn't realise the consequences of placing such a harsh restriction on the sale. Go back and offer 20% of the asking price to reflect the dimunition in value due to the restrictive covenant being imposed and see what he says, in reality with such a covenant I'd walk.

[MrShed]

As a hypothetical question, is it possible somehow to later remove a covenant? Or is there no way to ever remove it?

[Editor]

I don’t think is possible to remove a covenant altogether but it may be possible to negotiate a release or a variation of the covenant. This is done by a deed of release or variation.

You need to know who has the right to enforce the covenant, and this is not always easy to find out if the original owner has long since departed.

Any beneficiary of a covenant is likely to want payment for the release which is a matter for negotiation.

It may be possible to insure against the risk of the covenant subsequently being enforced if the original owner cannot be traced, but not if the person can be traced.

Also, the Lands Tribunal has powers to release or modify covenants which have become outdated or irrelevant, but it could be an expensive process.

[propman2]

yes agreed you can get insurance and this is usually applied where the covenant is very old and unlikely to be successfully enforced

[jeffrey]

I don’t think is possible to remove a covenant altogether but it may be possible to negotiate a release or a variation of the covenant. This is done by a deed of release or variation.

You need to know who has the right to enforce the covenant, and this is not always easy to find out if the original owner has long since departed.

Any beneficiary of a covenant is likely to want payment for the release which is a matter for negotiation.

It may be possible to insure against the risk of the covenant subsequently being enforced if the original owner cannot be traced, but not if the person can be traced.

Also, the Lands Tribunal has powers to release or modify covenants which have become outdated or irrelevant, but it could be an expensive process.

Well, a covenant is removable IF the covenantee (person with benefit) enters into formal Deed. HM Land Registry then notes Deed against both registered titles.