Agricultural Holdings Act 1984

JurisdictionUK Non-devolved
Citation1984 c. 41


Agricultural HoldingsAct 1984

1984 CHAPTER 41

An Act to amend the law with respect to agricultural holdings.

[12th July 1984]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Rent

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S-1 Determination of rent of agricultural holding.

1 Determination of rent of agricultural holding.

1. The following sections shall be substituted for section 8 of the 1948 Act—

S-8 ‘Arbitration on terms of tenancies as to rent.

8 ‘Arbitration on terms of tenancies as to rent.

(1) Subject to the provisions of this section, the landlord or the tenant of an agricultural holding may by notice in writing served on his tenant or landlord demand that the rent to be payable in respect of the holding as from the next termination date shall be referred to arbitration under this Act.

(2) On a reference under subsection (1) of this section the arbitrator shall determine what rent should be properly payable in respect of the holding at the date of the reference and accordingly shall, with effect from the next termination date following the date of the demand for arbitration, increase or reduce the rent previously payable or direct that it shall continue unchanged.

(3) For the purposes of the foregoing subsection the rent properly payable in respect of a holding shall be the rent at which the holding might reasonably be expected to be let by a prudent and willing landlord to a prudent and willing tenant, taking into account (subject to subsections (5) to (7) of this section) all relevant factors, including (in every case) the terms of the tenancy (including those relating to rent), the character and situation of the holding (including the locality in which it is situated), the productive capacity of the holding and its related earning capacity, and the current level of rents for comparable lettings, as determined in accordance with subsection (5) of this section.

(4) In subsection (3) of this section, in relation to the holding—

(a ) ‘productive capacity’ means the productive capacity of the holding (taking into account fixed equipment and any other available facilities on the holding) on the assumption that it is in the occupation of a competent tenant practising a system of farming suitable to the holding; and

(b ) ‘related earning capacity’ means the extent to which, in the light of that productive capacity, a competent tenant practising such a system of farming could reasonably be expected to profit from farming the holding.

(5) In determining for the purposes of that subsection the current level of rents for comparable lettings the arbitrator shall take into account any available evidence with respect to the rents (whether fixed by agreement between the parties or by arbitration under this Act) which are, or (in view of rents currently being tendered) are likely to become, payable in respect of tenancies of comparable agricultural holdings on terms (other than terms fixing the rent payable) similar to those of the tenancy under consideration, but shall disregard—

(a ) any element of the rents in question which is due to an appreciable scarcity of comparable holdings available for letting on such terms compared with the number of persons seeking to become tenants of such holdings on such terms;

(b ) any element of those rents which is due to the fact that the tenant of, or a person tendering for, any comparable holding is in occupation of other land in the vicinity of that holding that may conveniently be occupied together with that holding; and

(c ) any effect on those rents which is due to any allowances or reductions made in consideration of the charging of premiums.

(6) On a reference under subsection (1) of this section the arbitrator shall disregard any increase in the rental value of the holding which is due to—

(a ) tenant's improvements or fixed equipment other than improvements executed or equipment provided under an obligation imposed on the tenant by the terms of his contract of tenancy; and

(b ) landlord's improvements, in so far as the landlord has received or will receive grants out of moneys provided by Parliament or local government funds in respect of the execution of those improvements.

(7) On any such reference the arbitrator—

(a ) shall also disregard any effect on the rent of the fact that the tenant who is a party to the arbitration is in occupation of the holding; and

(b ) shall not fix the rent at a lower amount by reason of any dilapidation or deterioration of, or damage to, buildings or land caused or permitted by the tenant.

(8) Subject to subsections (9) to (12) of this section, a demand for arbitration shall not be effective for the purposes of subsection (1) of this section if the next termination date following the date of the demand falls earlier than the end of three years from any of the following dates, that is to say—

(a ) the commencement of the tenancy; or

(b ) the date as from which there took effect a previous increase or reduction of rent (whether made under this section or otherwise); or

(c ) the date as from which there took effect a previous direction of an arbitrator under this section that the rent should continue unchanged.

(9) Subsection (10) of this section applies in any case where a tenancy of an agricultural holding (‘the new holding’) commences under a contract of tenancy between—

(a ) a person who immediately before the date of the commencement of the tenancy was entitled to a severed part of the reversionary estate in an agricultural holding (‘the original holding’) in which the new holding was then comprised; and

(b ) the person who immediately before that date was the tenant of the original holding;

and where the rent payable in respect of the new holding at the commencement of the tenancy of that holding represents merely the appropriate portion of the rent payable in respect of the original holding immediately before the commencement of that tenancy.

(10) In any case to which this subsection applies—

(a ) subsection (8)(a ) of this section shall be read as referring to the commencement of the tenancy of the original holding; and

(b ) references to rent in subsection (8)(b ) and (c ) of this section shall be read as references to the rent payable in respect of the original holding;

until the first occasion following the commencement of the tenancy of the new holding on which any such increase or reduction of, or direction with respect to, the rent of the new holding as is mentioned in subsection (8)(b ) or (c ) takes effect.

(11) Where under an agreement between the landlord and the tenant of the holding (not being an agreement expressed to take effect as a new contract of tenancy between the parties) provision is made for adjustment of the boundaries of the holding or for any other variation of the terms of the tenancy, exclusive of those relating to rent, then, unless the agreement otherwise provides—

(a ) that provision shall for the purposes of subsection (8) of this section be treated as not operating to terminate the tenancy, and accordingly as not resulting in the commencement of a new contract of tenancy between the parties; and

(b ) any increase or reduction of rent solely attributable to any such adjustment or variation as aforesaid shall be disregarded for the purposes of paragraph (b ) of that subsection.

(12) The following shall be disregarded for the purposes of subsection (8)(b ) of this section—

(a ) an increase or reduction of rent under section 7(3) of this Act;

(b ) an increase of rent under section 9(1) of this Act or such an increase as is referred to in subsection (2) of that section, or any reduction of rent agreed between the landlord and the tenant of the holding in consequence of any change in the fixed equipment provided on the holding by the landlord;

(c ) a reduction of rent under section 10 of the Agricultural Holdings (Notices to Quit) Act 1977 .

(13) A demand for arbitration under subsection (1) of this section shall cease to be effective for the purposes of that subsection on the next termination date following the date of the demand unless before the said termination date—

(a ) an arbitrator has been appointed by agreement between the parties; or

(b ) an application has been made to the Minister for the appointment of an arbitrator by him.

S-8A

8A Interpretation of section 8.

(1) Section 8 of this Act applies in relation to tenancies of agricultural holdings whenever created.

(2) References in that section, in relation to a demand for arbitration with respect to the rent of any holding, to the next termination date following the date of the demand are references to the next day following the date of the demand on which the tenancy of the holding could have been determined by notice to quit given at the date of the demand.

(3) In subsection (6) of that section—

(a ) ‘tenant's improvements’ means any improvements which have been executed on the holding, in so far as they were executed wholly or partly at the expense of the tenant (whether or not that expense has been or will be reimbursed by a grant out of moneys provided by Parliament or local government funds) without any equivalent allowance or benefit made or given by the landlord in consideration of their execution;

(b ) ‘tenant's fixed equipment’ means fixed equipment provided by the tenant; and

(c ) ‘landlord's improvements’ means improvements executed on the holding by the landlord.

(4) Where the tenant has held a previous tenancy of the holding, then—

(a ) in the definition of ‘tenant's improvements’ in subsection (3)(a ) of this section, the reference to any such improvements as are there mentioned shall extend to improvements executed during that...

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