Hamish Lean: New tenancy proposals take lesson from history

Hamish Lean: New tenancy proposals take lesson from history

Hamish Lean

The recent Scottish government consultation in respect of its new Land Reform Bill included proposals in relation to a new form of agricultural tenancy that would allow the tenant considerable freedom to use the land within the tenancy for environmental purposes including planting trees and carbon sequestration.

The question immediately arises as to whether the industry needs another form of tenancy to add to secure tenancies, limited duration tenancies, short limited duration tenancies, modern limited duration tenancies and grazing lets. This is a complicated area of law and whilst the new form of tenancy may have advantages to some landlords and tenants there is no doubt that the legislation surrounding agricultural tenancies in Scotland can be off putting. None of this is particularly new, however.

In the era of agricultural improvement during the 18th Century, agricultural tenancies were granted subject to obligations on the part of the tenant concerning cultivation and fixed equipment as a deliberate policy measure on the part of landed estate proprietors to promote and encourage improvements.

In 1786, the Duke of Buccleuch issued a general declaration to the tenants of his south country estates. It made clear that “tenants who made improvements on their let farm by building, enclosing or other ways cultivating their possessions would be allowed to hold their leases upon reasonable terms and for such a length of time as would be sufficient not only to indemnify them of the expenses they incurred in carrying out works of improvement on the farm but to reward their industry for improving and cultivating according to the worth and extent thereof”.

The Duke further provided that if improving tenants had their leases brought to an end for any reason and even through their own fault an incoming tenant would be obliged to compensate them for the cost of their improvements to an amount to be decided by mutually chosen arbiters. This was an early attempt by landed estates to give agricultural tenants confidence to invest. This took place by encouraging them to make the investment in the knowledge that either they would be in occupation for a sufficient length of time to recoup the value of their investment or they would be entitled to be compensated if forced to give up possession before then.

Interestingly, the Duke’s declaration also reassured tenants that they would not be charged excessive rents. It is very revealing that almost 250 years later the concerns of agricultural tenants then remain broadly similar to the concerns of modern agricultural tenants now about how long they would be able to occupy the let farm, whether they would be compensated for improving the farm and that they wouldn’t be charged an excessive rent which would not allow them to make a profit.

These are the concerns that agricultural tenancy legislation since the 1880s has sought to address. Whether or not the new form of tenancy being proposed, which will sit alongside existing tenancies, helps or hinders, only time will tell.

Hamish Lean is a partner at Shepherd and Wedderburn. This article first appeared in The Courier.

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