Landlord of shooting lease terminated after tenant’s death loses appeal against dismissal of most of £1m claim

About this case:

• Citation:
  [2026] SAC (Civ) 35
• Judgment:
  External link
• Court:
  Sheriff Appeal Court
• Judge:
  Sheriff Principal N A Ross

Marchmont Farms Ltd raised a claim for £1,057,335 against the executors of the late Giles Wilson, to whom the sporting rights for grouse shooting on the estate at Kettelshiel Farm in Duns were leased from 1 October 2019 for a term expiring on 31 March 2030, contending he failed to comply with an undertaking to manage the estate. The respondents cross-appealed seeking dismissal of the whole action, which the sheriff allowed to proceed to proof on the remaining two heads of claim.

The appeal was heard by Sheriff Principal Nigel Ross, with Appeal Sheriffs Patrick Hughes and Christopher Shead. McMeeken, solicitor-advocate, appeared for the appellant and Garrity, advocate, for the respondents.

Tenant not responsible

The lease between the parties was described by the court as “poorly drafted and incompletely executed” and was accompanied by a Memorandum of Agreement noting that the appellant would continue to manage Kettelshiel Farm and graze up to 500 sheep. After the death of Mr Wilson on 16 February, his executors instructed a notice of termination of the lease, which was served on the appellant in terms of sections 16(3) and (4) of the Succession (Scotland) Act 1964 with effect from 31 May 2024. While the rent was a nominal £1 per year, the appellant averred that he had undertaken to manage the estate, which the appellant had since required to carry out at its own expense.

The respondents did not dispute that section 16(5) of the 1964 Act preserved any right to damages in respect of termination of the lease but argued that the heads of claim were neither relevant nor sufficiently specified and had not arisen under the lease or as a result of termination. Following debate, the sheriff refused to admit six of the eight heads of claim to probation, including the continuing costs of management and loss of capital value.

It was submitted by the solicitor-advocate for the appellant that the continuing costs of management were recoverable, as they would not have been incurred but for the termination. While they were voluntary costs, that was no bar to recovery. A commercial common-sense approach, per Ashtead Plant Hire Co v Granton Central Developments (2020), would render the claims relevant, and the averments of loss of capital value underlined the reasonableness of its expenditure.

Counsel for the respondents submitted that the claim as presented covered matters for which the tenant was not responsible. While parties had apparently intended to impose some obligation of maintenance, they had not signed the schedule which identified these. The clauses founded upon were therefore void from uncertainty.

Undermined appellant’s claim

Delivering the opinion of the court, Sheriff Principal Ross outlined the context of the lease, saying: “Crucially, the Lease did not impose any general obligation on the tenant to manage the heritable subjects. This was consistent with the Memorandum, which provided context that the appellant, not the respondents, would continue to manage Kettelshiel Farm. The appellant retained control over the areas which were not the buildings or other fixed equipment. The tenant had no right to plant crops, or erect or alter buildings. The appellant also retained considerable specific controls over the land, set out in the reservations clause.”

He continued: “These retained rights represented considerable restraints on the tenant’s right or ability to manage the heritable subjects and, in the case of the apparently unrestricted right to resume control, represent an absence of secure tenure. Properly understood, the Lease terms undermined the appellant’s claim that the tenant had any general obligation of management, or anything close to it.”

Considering that the claim as presented bore little resemblance to the terms of the lease, the Sheriff Principal said: “The Lease was of shooting rights over heritable property, not of the property itself, save for the four identified buildings in part 1 of the schedule, and the additional permanent enclosure and drainage structures mentioned in Clause 6. The reservations, set out above, were eloquent of the tenant having relatively limited enjoyment of, or responsibility for maintaining, the heritable subjects. Accordingly, where the management of the heritable subjects was retained by the appellant, there is no discernible justification to claim £50,000 a year staff costs, or £17,500 for managing agents and other professionals.”

He concluded: “While the principles of contractual construction in Ashtead Plant Hire Co are uncontroversial, there was no scope to apply them here. There was nothing within the Lease which would allow the construction urged by the appellant, a problem compounded by parties’ failure to complete that part of the contract, the schedule, which would have given a degree of certainty as to the tenant’s obligations. The present claim was largely thwarted by the failures in drafting and execution by the contracting parties. It was not enough, as the appellant submitted, to identify a general intention that the tenant would have some repairing obligation.”

The appeal was therefore refused, with the cross-appeal allowed to the extent of excluding one further head of claim. In respect of the remaining head, the cause was remitted to the sheriff for further procedure.