By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

An attorney yesterday warned that permitting the “ad hoc” removal of restrictive covenants will be “the death knell for orderly development in The Bahamas”.

Gail Lockhart Charles KC, who is representing New Providence Development Company and Old Fort Bay Company, told Tribune Business a “complete breakdown of the planning process in The Bahamas” will occur if the Town Planning Committee approves the joint request from five property owners to extinguish the “restrictive covenants” governing the development of their Western Road land parcels.

Speaking after Wednesday night’s public consultation on the application, she argued that the Committee is only empowered by law to extinguish such covenants via the Zoning By-Law process where changes have to be approved by the minister responsible for planning. As a result, it has no powers or authority to grant such requests from individual applicants such as these.

But, should the committee approve the application by Llan-Y-Rafon Investments, Lorishill Ltd, BRAM, New Hope Investments and Michael Symonette, all of whom own parcels of between five to 5.053 acres, Mrs Lockhart-Charles told this newspaper it will set “an exceptionally dangerous precedent for the entire Bahamas”.

She explained that it would pave the way for land and property owners, wherever they are located, to simply apply to the Town Planning Committee to extinguish covenants restricting different forms of development for their real estate regardless of the impact on neighbours or the public interest.

As an example, Mrs Lockhart-Charles said a decision in favour of the five would effectively open the door for residents in all New Providence gated communities to follow suit and seek land use changes that allow them to open a restaurant or commercial venture on their properties, thereby undermining the quality of life for other residents.

“It would be the death knell of orderly development with respect to covenants contractually entered into between parties as part of their bargain,” she told Tribune Business. “It would just mean that all somebody has to do is sign an agreement, sit back and when they want to do something with their land that they agreed not to do, all they have to do is go to Town Planning and ask them to extinguish the covenants.

The five, who own separate parcels of about five acres each on the southern side of Western Road between the Old Fort Bay roundabout and Lyford Cay, are urging the Town Planning Committee to “extinguish restrictive covenants” previously imposed by New Providence Development Company that prevent their properties from being used for commercial purposes.

“They bought the property with restrictive covenants, signed the agreement that they were not allowed to do this, not allowed to do that with the property. That was part of the bargain, and now they want the Town Planning Committee to do this for them,” Mrs Lockhart-Charles added. “It is a complete breakdown of the planning process in The Bahamas. It’s the death knell for orderly development.”

She added that her clients’ orderly master-planning of western New Providence, clearly setting out where residential and commercial development is to take place and governing this by the use of restrictive covenants, would be “disrupted” if the Committee approved the application.

“How is it in the public interest for the Town Planning Committee to insert itself in that and change the covenants?” Mrs Lockhart-Charles asked. “What kind of precedent is it going to set? Why shouldn’t someone in a gated community wake up one day, decide they will have a restaurant or commercial activity on their lot that increases the value never mind the restrictive covenants?

“There is no provision under the Act for someone to make an application for the restrictive covenants to be removed. That’s not provided for in the Act. The Act provides for development applications. You cannot develop it without getting approval. You own the land, you make an application for development...

“This just erodes confidence in the enforceability of contractual rights that have existed and enabled property development for years.” Mrs Lockhart-Charles, in a subsequent e-mail to Tribune Business, further explained: “Restrictive covenants are not mere formalities; they are fundamental tools in real estate development.....

“Enforceability of these covenants provides certainty that the land will be developed in a regulated and planned manner, which in turn adds value. The Planning and Subdivision Act makes it clear that the Town Planning Committee’s authority to impose or extinguish restrictions on land use is exercisable only within the framework of the Zoning By-Law process.

“Under the Planning and Subdivision Act, Zoning By-Laws are prepared by the Department of Physical Planning under the director’s direction and subsequently approved by the minister. There is no provision in the Act for these powers to be invoked in an ad hoc manner through individual planning applications.”

She added: “For the Town Planning Committee to entertain a private landowner’s application for the extinguishment of restrictive covenants sets an exceptionally dangerous precedent for the entire Bahamas.

“There are numerous developments in the east and west of New Providence, as well as elsewhere in The Bahamas, where properties have been sold by developers as part of carefully structured, master-planned communities.

“Restrictive covenants are a critical component of this framework, providing assurance to hundreds of purchasers that their investments will be safeguarded by the consistent and compliant development of neighbouring parcels. These covenants are designed not only to preserve the distinctive character of these areas but also to afford purchasers the security that the agreed-upon standards will be upheld.

“For the Town Planning Committee to now insert itself in this process to interfere with, indeed to totally destroy, a bargain made between two parties which regulates the future use of land sold from party A to party B is an extremely dangerous thing. Such interference destabilises the settled expectations of property owners and erodes confidence in the integrity of planned developments.”

Owen Wells, the McKinney, Turner and Company attorney representing the five property owners, confirmed at Wednesday night’s public consultation that while his clients have no commercial developments planned at this point they would like restrictive covenants lifted to “consider the future”.

He argued that his clients are burdened by the “draconian” covenants placed on their properties decades ago that restrict them to just single-family residential development, and would like them lifted to increase their land values and have the ability to consider future commercial ventures.

“There is no consideration for any commercial development at this time. Each party simply just wants the covenant lifted so they can consider the future and, to be frank, it also increases the land value. So that’s where they are right now. There’s no consideration for anything at this time,” said Mr Wells.

He said the restrictions are “outdated” as the area has developed significantly since the covenants were placed on the properties, while New Providence’s population is also “shifting” into the western district, making multi-family ventures such as condominiums and complexes “vital”.

“Anyone who’s been in that area has drove past that area or is familiar with that area, will know that the land has evolved tremendously from five years ago, 10 years ago, 20 years ago. What we have now is an area that we would say is considered commercial,” said Mr Wells.

“Right now, as it stands, it would not help create jobs, which we all know is vital to the economy, and it doesn’t generate taxes for the Government, as the land is idle and vacant. A viable production of the land for our clients would be something commercial in nature, where the value of their land, their investment that they would have made in the 1980s and 1990s, significantly increases.”

Mr Wells added that the five parcels are located near Old Fort Bay and Albany, and the property owners would like to participate in the area’s continued development. “Although each parcel of the land may be considered small, approximately five acres, where they’re located is a corridor this makes a redevelopment potentially significant. That corridor would consist of Albany, Lyford Cay, Old Fort Bay,” he said.

“That whole corridor is developing. As such, the owners of the land would like to be a part of this development, and have made an application. Unfortunately, the properties are burdened by what we call draconian restrictive covenants, which were included in their conveyances from the late 80s or early 90s.”

Mr Wells added that the covenants were imposed to prevent the emergence of competition, and rival developments, while New Providence Development Company was constructing the Old Fort Bay community and, later, the Old Fort Bay Town Centre. As both projects have been completed, Mr Wells asserted it is time for others to “move on and achieve some goals” in the area.

“We go further to saying that the enforcing land owners, who would be Old Fort Bay, have already achieved the objectives of the covenants, which we say is for the fully developed residential community,” said Mr Wells

“Their community is fully developed, whether it be the residential area behind the gates or whether it be the commercial complexes that will consist of Pineapple House and any other endeavour that they may be connected with.

“So we say that the covenants that they had in place, which would have restricted any other commercial enterprise at that time, are already extinguished. They’ve already achieved their goals, and now it’s time for others in that area to move on and achieve some goals of their own in a commercial nature.”

Mrs Lockhart-Charles, though, questioned whether the Town Planning Committee has the authority to remove restrictive covenants from a parcel of land without an application for development being submitted.

She argued that the Town Planning Act does not include an application for the extinguishment of covenants, and the Committee should not be used to remove a “private bargain that you entered into freely and voluntarily”.

“The Act provides for applicants to make applications, typically for development. It doesn’t provide for entities to make applications for the Town Planning Committee to intervene in their private arguments and extinguish their covenants,” said Mrs Lockhart-Charles

“The Committee has to determine applications, and they can only determine applications that are provided for by the Act. The committee is a creature of statute.

“The Committee has many powers. You come before the Committee on an application for development. You don’t come before the Committee with a request to extinguish your private bargain that you entered into freely, and voluntarily and ask the Committee to extinguish covenants because you no longer want to comply with that.”

Mrs Lockhart-Charles, in her statement to Tribune Business, added: “It was also troubling to observe that, during the hearing, a member of the Town Planning Committee openly and unequivocally endorsed the applications in question.

“It is a principle recognised both domestically and internationally that members of decision-making bodies must maintain strict impartiality, avoiding even the appearance of bias or pre-determination. These standards are essential to preserving public trust and ensuring that all parties, including applicants, objectors and the general public, are afforded a fair and transparent process.

“The actions and statements in question raise serious questions regarding procedural fairness and the proper exercise of the Committee’s statutory functions, and erode confidence in the planning process.”