Re Djurovic

The matter of Re Djurovic was before the court where the respondents sought an order for the modification of a restrictive covenant in relation to a property in Melbourne. The respondents, as owners of a property, sought to build a second dwelling on a lot which was subject to a covenant that prohibited more than one dwelling from being built on the lot. The covenant was part of the original subdivision of the land and was intended to maintain the residential character of the area. The applicants, who owned neighbouring properties, opposed the modification on the basis that it would breach the covenant and substantially injure them.

The legal issues before the court were whether the covenant was obsolete and, if not, whether its modification or discharge would cause substantial injury to the covenantees. The respondents argued that the covenant was obsolete as the area had changed in character and the covenant no longer served its intended purpose. They submitted that the covenant ought to be modified or discharged to allow for the construction of a second dwelling on the lot. The applicants, on the other hand, argued that the covenant was still relevant and its modification or discharge would cause substantial injury to them as it would breach the covenant and lower the value of their properties.

The court held that the covenant was not obsolete as it was still relevant to maintaining the residential character of the area. However, the court found that the covenant could be modified to avoid causing substantial injury to the covenantees. The court considered the provisions of the Property Law Act 1958 s 84(1) and held that the modification would not cause substantial injury to the covenantees if it was limited to the construction of a second dwelling on the lot in question. The court also considered the evidence of the parties and the impact of the modification on the surrounding area. Ultimately, the court held that the modification was appropriate to avoid injury to the covenantees and in the interests of justice.

The court made an order for the modification of the restrictive covenant to allow for the construction of a second dwelling on the lot in question. The modification was limited to the specific lot and did not affect the rights of other property owners in the area. The applicants' appeal was dismissed.