Amy Proferes provides an update on dispensing powers in building schemes
- An analysis of building schemes, enforcing covenants & dispensing powers.
Building schemes, or schemes of development, developed as a result of the difficulties involved in enforcing restrictive covenants when plots are sold out of a larger estate. There are four possibilities (see eg Small v Oliver & Saunders (Developments) Ltd [2006] EWHC 1293 (Ch) at [27], [2006] All ER (D) 376 (May)):
a) The benefit of the covenants may be annexed to the vendor’s retained land, which decreases in size with each sale. Purchasers and their successors may only enforce covenants against earlier purchasers and their successors.
b) The covenants may be annexed to the entirety of the land unsold by the vendor, but not to parts of that land. The vendor alone may enforce the covenants against all the purchasers. If he disposes of the retained land he may expressly assign the benefit of the covenants to his transferee; if he does not do so, no one has the right
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