History books will certainly mark the year 2020 as the year of COVID-19. The global pandemic caused by the deadly virus will undoubtedly change the world we know. We already see changes to the way we shop, eat and work as the list of “the new normal” seems endless.
Changes to the way we live give many business owners new ideas on how to carry their business post-COVID-19 to adapt to people’s new needs and expectations. Given the lockdown, many businesses are turning to an online presence only.
We regularly see many commercial property tenants reviewing their leases and thinking about shifting their businesses to online presence only. Although the idea to cut the costs of the premises and move businesses online is advantageous in principle, many residential properties have certain restrictive covenants on the title which prohibit what can and can’t be carried out at the property. These often include restrictions on “carrying out business”, such as running an online business from home.
What to do if Your Title Prevents You from Using the Property to Carry Out Business?
Some questions to be considered are:
- Are you planning to have employees around your house or is it only you and your computer?
- Are you planning on having face-to-face meetings?
- Are you going to cause a lot of noise whilst carrying out the business?
These and many other questions will have to be answered before one makes the decision to carry out the business from residential premises. However, there is certainly one clear correlation between the abovementioned questions – the level of nuisance.
Are You Going to be a Nuisance to Your Neighbours Whilst Carrying Out Your Business?
Restrictions on use usually protect and benefit the neighbouring properties and are imposed on you to protect your neighbours’ rights to peacefully enjoy their premises. Arguably, the question one will end up having is one of the commercial nature and balance of risk - will the beneficiary of the covenant enforce the covenant against me if I am being a nuisance?
The risk element, however, can be avoided if you and the person who benefits from the restriction against your title agrees to release you from the restrictive covenant on use by way of a deed of release.
Covenants can be released if both the beneficiary and the person carrying the burden agrees to it.
Matters such as any existing mortgage or lender’s consent and planning permission may also have to be considered before residential premises are used for business purposes.
How Can Howells Solicitors Help?
If you would like to discuss changes post COVID or any other commercial property matter, please get in touch with our friendly team of specialist solicitors.