Earl of Galloway v M'Clelland
| Jurisdiction | Scotland |
| Judgment Date | 20 July 1915 |
| Date | 20 July 1915 |
| Docket Number | No. 119. |
| Court | Court of Session |
Lord President, Lord Johnston, Lord Mackenzie, Lord Skerrington, Lord Cullen, Lord Dewar, Lord Ormidale, Lord Hunter, Lord Anderson, Lord Justice-Clerk, Lord Dundas, Lord Salvesen, Lord Guthrie.
LeaseOutgoingCompensation for improvementsMeaning of improvementsImprovements executed in implement of leaseHolding left in same state at ish as at entryLaying down temporary pastureAgricultural Holdings (Scotland) Act, 1908 (8 Edw. VII. cap. 64), sec. 1, and First Sched., Part in. (26).
A tenant is not entitled to compensation under the Agricultural Holdings (Scotland) Act, 1908, for making an improvement comprised in the First Schedule to the Act, if the improvement was one which he was bound under his lease to execute.
So held by the Whole Court (diss. Lords Dundas, Johnston, Mackenzie, Skerrington, Cullen, and Dewar) with regard to a claim for compensation for temporary pasture laid down by a tenant in accordance with the rotation of cropping prescribed by his lease, a similar acreage having been under temporary pasture at the commencement of the lease.
Question whether, in order to entitle the tenant to such compensation, it was necessary that the operation executed by him should result in an improvement in the condition of the holding at the waygoing as compared with its condition at the date of entry under the lease.
Opinions, per the Lord President, Lords Salvesen, Guthrie, and Ormidale, that it was necessary.
Opinions contra, per Lords Dundas, Johnston, Mackenzie, Skerrington, Cullen, and Dewar.
Opinion, per Lord Hunter, that the operation must effect an improvement in the holding at the ish as compared with the state in which it would have been found had the tenant performed only his contract obligations and nothing more.
LeaseOutgoingCompensation for improvementsLaying down temporary pastureBenefit given by landlordImplied benefitPasture handed over at entry to subjectsAgricultural Holdings (Scotland) Act, 1908 (8 Edw. VII. cap. 64), sec. 1 (2) (a), and First Sched., Part iii. (26).
A tenant under a lease, entered into prior to the date of the Agricultural Holdings (Scotland) Act, 1908, claimed compensation under that Act for an improvement, in respect of temporary pasture laid down by him in carrying out the system of cultivation imposed on him by the lease. The landlord maintained that, if compensation fell to be awarded, the arbiter must set against it the temporary pasture handed over to the tenant free of charge on his entry, as being, in terms of sec. 1 (2) (a) of the Act, a benefit which the landlord had given or allowed to the tenant in consideration of his executing the improvement. There was no reference in the lease to the temporary pasture received by the tenant on his entry.
Opinions, per Lords Dundas, Johnston, Salvesen, Mackenzie, Skerrington, Cullen, and Dewar, that this temporary pasture, although it was not specially mentioned and allowed as a benefit, must be taken into account as being a benefit under sec. 1 (2) (a).
Opinions contra, per Lords Hunter and Anderson.
M'Quater v. Fergusson, 1911 S. C. 640, discussed.
Andrew M'Clelland, who had been tenant of the holding of Carslae and Carsegowan Croft, of which the Earl of Galloway was the proprietor, on quitting the holding on the determination of his lease at Martinmas 1913 claimed compensation for improvements in terms of the Agricultural Holdings (Scotland) Act, 1908.* This claim was submitted to John M'Caig, Belmont, Stranraer, as arbiter.
On 8th April 1914 the arbiter issued notes of proposed findings in which he proposed to allow compensation for temporary pasture. The landlord requested the arbiter to state a case for the opinion of the Sheriff.
The case set forth:
The claims upon which the arbiter was called to adjudicate included, inter alia, a claim under the First Schedule, Part iii. (26),
of the said Act, being a claim for compensation for laying down temporary pasture.
The arbitration was begun under an appointment by the Board of Agriculture, dated 4th March 1914.
No proof was led, but the following facts were admitted:
The claimant was tenant of the said holding of Carslae and Carsegowan Croft under a lease from the landlord's predecessor in the estate, dated 4th and 7th May 1895, for the period of nineteen years from Martinmas (28th November) 1894. The claimant was also tenant of the farm under a previous lease, which expired at Martinmas 1894, and it was assumed that at that term there was the usual extent of temporary pasture (approximately one-half, or 128 acres) on the farm, but no particulars for ascertaining the extent or value thereof were submitted to me.
In accordance with the invariable custom then prevailing in the county of Wigtown and neighbouring counties, according to which an incoming tenant or a tenant entering on a new lease paid nothing (except in so far as included in the rent of the farm) for temporary pasture laid down more than two years previously, the claimant in this case was not required on his entry under the lease dated 4th and 7th May 1895 to make any special payment in respect of the temporary pasture then existing. The lease (which is referred to and held to be part of this case) contained no stipulation with regard to such pasture, but it provided that the tenant was to crop and cultivate the lands according to the rules of good husbandry, and to follow a six-shift rotation therein specified. According to this rotation one-half of the land or thereby would be in pasture grass (or partly in hay) in any given year during the currency of the lease. The holding was worked on this system. The total area of the farm, apart from some moorland, stackyard, and roads, is 257694 acres, and the area under grass during the last year of the tenancy was 156297 acres. The total sum claimed under temporary pasture is 122, 11s. 9d. for 138853 acres.
The landlord pleaded that the Act and Schedule did not confer upon the tenant a right to compensation for temporary pasture left at the termination of the tenancy, on the ground that such temporary pasture must be held to be merely the equivalent of similar pasture received by the tenant free of charge on his entry under a lease which stipulated in effect that an equal extent of temporary pasture should be maintained on the holding during the currency of the lease and left on the holding at its termination, or, alternatively, if the tenant's claim to such compensation was good, that I was bound under section 1 (2) (a) of the Act, in fixing the amount of compensation due, to take into account as a benefit which the landlord has given or allowed to the tenant in consideration of the tenant executing the improvement, the area of temporary pasture handed over to the tenant free of charge on his entry. The landlord therefore contended that no compensation should be allowed for 128847 acres, in respect that this area fell under the lease to be left in temporary pasture, but admitted that compensation might be allowed for 27450 acres of temporary pasture, being the excess over that area.
The tenant contended that the rotation stipulated in the lease did not deprive him of any compensation allowed by the Agricultural Holdings (Scotland) Act, 1908, that any temporary pasture on the farm at the beginning of the lease was not received by the tenant free of charge, but formed part of the subjects for which the rent was given, and that in any case such temporary pasture at the beginning of the lease was not a benefit specially mentioned and allowed in consideration of the tenant executing the improvement in question.
I inspected the land and found that the area in temporary pasture, sown down more than two years prior to the determination of the tenancy, which would be of value to the landlord or incoming tenant was 108496 acres, and I disallowed the claim to the extent of the balance of 30357 acres.
I considered that the tenant was entitled to compensation under the Act and Schedule for all temporary pasture laid down more than two years prior to the termination of the lease, which in my opinion was of value to the landlord or incoming tenant, and that any temporary pasture on the farm at the beginning of the lease did not fall to be taken into account.
I accordingly found that the outgoing tenant had made an improvement in terms of the Act and Part iii. (26) of the First Schedule thereto, by laying down 108496 acres in temporary pasture; that this improvement was of value to the incoming tenant or landlord; and that the amount of compensation due by the landlord to the claimant for this improvement was 80, 11s. 9d. I disallowed the claim in respect of the remaining 30357 acres of temporary pasture, on the ground that in my view this portion was not an improvement which was of value to the incoming tenant or landlord.
On 8th April 1914 I issued notes of proposed findings, in which, inter alia, I proposed to allow the claimant the said sum of 80, 11s. 9d. as compensation for laying down 108.496 acres of temporary pasture.
The questions of law for the opinion of the Court were:(1) On the claim for temporary pasture is the tenant entitled to compensation for the whole of such part of the grass laid down more than two years prior to the termination of the tenancy as I consider to be of value to the landlord or incoming tenant, notwithstanding that under the rotation prescribed by the lease the tenant is bound to leave at the termination of his tenancy as large an area in temporary pasture as there was at the beginning? (2) If the preceding question is answered in the affirmative, am I bound in fixing the amount of compensation due to the tenant to take into account and allow for the value (if any) to the tenant of the temporary pasture on the farm at the beginning of the lease, as a benefit which the landlord has given or allowed in terms of section 1 (2) (a) of the Act?
On 18th August 1914 the...
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