i would start again and get some good soil dug in there to stop it being so lumpy and water resistent . the thing is with a lawn as most things the preperation is everything . there maybe a better suggestion than that that somebody else can think of as im know expert .

Before starting again!- I would look at the environment of your lawn? You say - it is small garden enclosed with a six foot privit and a very large Birch tree. It does not sound like poor drainage on heavy clay soil as you have dug and gritted it and you say it gets dusty. I think it is more likely that the hedge and tree take up light and water which is also what your lawn needs. Can you post some photos so we can see it?

Thanks, somehow its nice to talk it out doesn't seem like Im' alone with it.

I will try and get some photos up. I think you are right the trees and hedge have exhausted the soil. I am realy too tired to think of re-digging the whole thing again. what if I raised the level (it is a small lawn and filled with new top soil?

Best if we saw some photos MB.

If you want to save the Birch and the Privet, you wouldn't really want to put much soil on anyway. From the sound of it, I would put down an inch or so of compost, plus some seaweed meal, rake it in, and water deeply a couple times. Then, I would look for shade tolerant species of grass, such as Turf-Type Tall Fescue, or Roughstalk Bluegrass, and start your lawn with these.