Agricultural holding–Farmer held to have intended to let pasture to neighbour only for a short grazing tenancy, despite complications caused by a previous letting expressed to be from April 1 1970 to March 31 1971–Order for possession and mesne profits–Observations on possibility of rectification in a case where an adviser drafts an agreement under a false impression as to the effect in law of the words used
This was an
claim by Mr Nigel Roy Cox against Mr Frederick James Husk for possession of
certain grazing land at Richborough, near Sandwich, Kent, with mesne profits
from March 31 1975, and for damages for trespass by the defendant’s cattle.
Mr P
Langdon-Davies (instructed by Rowe & Maw) appeared for the plaintiff, and
Mr M H Spence (instructed by Stilwell, Harty & Brockman, of Dover)
represented the defendant.
Giving
judgment, GRIFFITHS J said: Mr Cox, the plaintiff, is the owner of three
substantial parcels of grazing land in Kent, near the town of Sandwich. Two of
the parcels have been referred to as grazing land at Richborough, and
throughout this trial they have been referred to as the ‘north pasture’ and the
‘south pasture.’ They are respectively
242 acres and 198 1/2 acres in dimensions. The third parcel of land, which is
rather smaller and in the order of 100 acres, is known as Weatherlees. The
defendant, Mr Husk, has farmed in a very substantial way throughout his working
life in the vicinity of Dover, and since 1964 he has been taking a grazing
tenancy of Mr Cox’s land. For some years he took just the north and the south
pastures, and then there was included the pasture known as Weatherlees. Having
heard the evidence of Mr Cox and also the evidence of Mr Husk, I am abundantly
satisfied that these two gentlemen had no intention whatever of creating by
these arrangements an agricultural tenancy such as would enjoy the protection
of the Agricultural Holdings Act 1948. Every year they would renegotiate the
terms upon which the pastures would be let for the forthcoming year. Most of
the negotiations they carried out through their respective agents. Mr Cox used
Bernard Thorpe & Partners, the partner with particular responsibility for
this being Mr J K Scrace, and Mr Husk used surveyors known as G W Finn &
Sons. But the two men enjoyed meeting from time to time, and I do not doubt Mr
Husk when he tells me that they enjoyed the bargaining that went on between
them, and they enjoyed a drink or two over the bargaining; and for many years
it was a very happy arrangement. That there was never any intention to create a
tenancy protected by the Agricultural Holdings Act is in fact set out expressly
in the first letter on the agreed bundle, dated April 2 1964 from Bernard
Thorpe & Partners and addressed to Mr Husk himself. It starts: ‘Land at
Richborough [ie the north and south pastures]. We confirm the arrangements made
with you as to the sale of grass keep on the above land as under. You are to
have the grazing rights from March 31 1964 until February 28 1965.’ It terminates: ‘It is understood between the
parties that no tenancy of any kind under the Agricultural Holdings Act is
created by this letter or by this arrangement.’
I am quite satisfied that that underlying agreement continued throughout
the relationship between these two men and between their respective agents, and
I accept Mr Cox’s evidence that Mr Husk would not be interested in having a
tenancy on any permanent basis, because this land is low-lying, adjacent to the
sea, and is at risk from incursion by sea-water. Indeed, it has to be protected
by sea defence works, and even so, from time to time a part of it becomes
flooded at high tides and for that reason is known as ‘The Saltings.’
For many years
the agreements were concluded by word of mouth and in correspondence, and I do
not propose to go through the bundle: The broad nature of the agreements has
been conveniently set out on a schedule that has been put in before me and
numbered P4. The correspondence itself shows that there were extensive
negotiations and proposals and counter-proposals year after year before a bargain
was struck. The grazings themselves were varied, to the extent that sometimes
all three would be taken, sometimes only two, sometimes only one. The rent was
varied; the conditions with which the tenant had to comply varied. But there
came a time, for reasons which have not really been explained in the evidence,
when somebody in Bernard Thorpe & Partners thought it would be desirable to
strike a rather more formal note, and accordingly a formal tenancy agreement
was drawn up, and this agreement made its appearance in the year 1970. When
that agreement was drawn up it recited that ‘The grazier shall be entitled
during the seasonal period beginning on the first day of April one thousand
nine hundred and seventy and ending on the thirty-first day of March one thousand
nine hundred and seventy-one to graze cattle.’
It is the drafting of that agreement that gives rise to the dispute in
this case. Under section 2 of the Agricultural Holdings Act 1948 it is provided
that if there is an agricultural tenancy of a period of less than a year, it is
to be treated, with certain exceptions, as a tenancy from year to year, and
thus is caught by the provisions of the Act. The exceptions are set out in the
proviso, and one of them relates to grazing rights, and it reads as follows:
‘Provided
that this subsection shall not have effect in relation to an agreement for the
letting of land, or the granting of a licence to occupy land, made (whether or
not the agreement expressly so provides) in contemplation of the use of the
land only for grazing or mowing during some specified part of the year.’
It has been
held that the words ‘during some specified period of the year’ means some part
of the year less than 365 days, so that if there is an agreement to let grazing
for
however, it is for a shorter period, it is not so caught, and due to what I can
only regard as a lacuna in the drafting of the Act there is a rather bizarre
situation that if the letting is for more than 365 days but less than two years
it also is not caught. And the contention of the defendant in this case is that
stemming from that agreement, contrary to the intention of both farmers, they
in fact created an agricultural tenancy, and as a result of that it is said
that the defendant is entitled to remain in possession of the northern pasture,
although Mr Cox wishes to have it returned to him.
The history of
the matter proceeded as follows. I have already referred to 1970, when the
agreement was first drafted, but Mr Spence, on behalf of the defendant, does
not rely upon it as creating an agricultural tenancy, either in that year or in
the succeeding year, or indeed in the year after that, because–and I do not
wish now to go at length into the documentation–it is quite apparent that this
agreement was regarded as a mere formality, sometimes to be signed by one or
other of the parties, sometimes just not bothered with at all, and until the
year 1973 it was in fact completed substantially after the commencement of the
tenancy. But, says Mr Spence, there is no doubt that as from 1973 the tenancy
that was entered into between the parties was for a period of one year, namely,
from April 1 until March 31 1974, and that was for all three pastures, £500
being paid for the north, £900 for the south and £150 for Weatherlees, being
paid as to £1,100 on entry and as to £450 on October 1 1973; and counsel relied
in particular in support of that submission, on the letter of March 29 1973
written by Mr Cox to Mr Scrace which commences:
Thank you for
your cheque for £650 yesterday with £150 for 1973-74 season at Weatherlees and
£500 for the northern area of New Richborough Farm. The terms are outlined in
my letter to Mr Scrace, copy of which I sent you.
That agreement
was later enlarged to include the southern area as well, and it is submitted
that that constituted at least in that year an agricultural tenancy, because it
was not for a period less than one year. When that year’s grazing ended the
parties, that is Mr Cox and Mr Husk, entered into negotiations for the grazing
for 1974-75. Again the correspondence shows that there had been some
dissatisfaction between Mr Cox and Mr Husk as to the way in which they were
carrying out their respective obligations under the agreement. I need not go
into details; there was a dispute about thistles, there was a dispute about the
sea wall, and so on. On February 26 1974 those negotiations opened, with Mr Cox
making an offer to Mr John Linington, who was then agent on behalf of Mr Husk,
and the offer was this: ‘I am prepared to offer the New Downs grazing to Mr
Husk again for the usual 11-month period’ –and I pause there to emphasise how
little attention Mr Cox had paid to the agreement that had been drawn up,
specifying the period to be for 12 months–‘at a figure of £1,650 paid as to
£850 upon entry and £800 on October 1 1974. If he accepts the new grazing
contract he may have the courtesy of carrying them over.’ That was not immediately accepted, but a
reply came back from G W Finn & Sons making a counter-offer, in which it
said, ‘Mr Husk is prepared to pay £1,500 for the same season as before, with
£750 being paid upon entry and £750 being paid on October 1 1974, and will
accept full responsibility for patching fences where necessary.’ That was not suitable to Mr Cox, and he wrote
directly to Mr Husk himself on March 23 1974 on his way to Spain from
Fontainebleau, and he said: ‘Dear Mr Husk, if you want New Downs land from
April 1 1974 until March 1 1975 at £1,650, paid as to £850 on April 1 and £800
on October 1, please cable me immediately. If not, please vacate by March 25-30
1974.’ He then made him an offer in
relation to the land at Weatherlees, introducing wholly different and special
terms from that upon which it had been previously let. It read as follows:
Weatherlees
you can have, if you so want, until June 16 at £3.50 a week from April 1 1974,
but it must be clear of cattle by the morning of June 17 for the inspector to
see, otherwise should you want to vacate instead and have other plans.
Weatherlees’ rent is payable April 1-June 16 inclusive. After the hearing and
the inspection, it can be offered to you at £3.50 per week again, all the best.
Subject to contract and spraying of thistles etc.
He sent a copy
of that to Mr Linington, with a letter which read, ‘Mr Linington, Husk must
vacate immediately, unless he accepts offer overleaf.’ He was sent a telegram by Mr Husk which read,
‘Accept Weatherlees as your letter March 23 stop original offer for whole by me
still stands.’ So there is the position,
Mr Husk taking the limited offer for Weatherlees but not accepting the offer
for the north and south pastures. That did not satisfy Mr Cox, and he was not
prepared to let it to Mr Husk at that time on those terms, and he so notified
his own agent, Mr Scrace, and he instructed Mr Scrace to advertise the land,
both north and south pastures, and make attempts to let the grazing for a
better price elsewhere, or alternatively let the hay crop on it. Mr Scrace sent
his assistant, Mr J M H Deeley, down to inspect the land on April 26, and he
found to his surprise, in view of the letter that had been written to Mr Husk,
that Mr Husk’s cattle were on the northern pasture. And he says that he saw Mr
Husk in his car and expressed surprise that the cattle were there. Mr Husk said
that he was still negotiating with Mr Cox, and he did not think that he had
heard the last of the matter, and he thought he would probably get the grazing
again. Mr Husk says that he has no recollection of that meeting. I am satisfied
that it took place. Mr Deeley came back and reported to Mr Scrace that the
cattle were there. According to Mr Scrace’s instructions they ought not to have
been there, and so he immediately telephoned Mr Linington, Mr Husk’s agent, to
complain about that state of affairs. He said that he told Mr Linington that he
knew the cattle should not be there, and Mr Linington agreed and said that he
was very surprised to hear it and he would find out about it. Mr Scrace told
me, and there was no challenge to this at all, that a day or so later Mr
Linington telephoned him and said that he had spoken to Mr Husk about it, and
he said that he was very sorry that the cattle were there but they had broken
through the fence from adjoining land. They were now off the land, that is the
northern pasture, and the fence was being repaired. That information, being
relayed by Mr Husk’s agent to Mr Cox’s agent, is the clearest possible
acceptance by Mr Husk that he knew that he had no right whatever to have those
cattle on that land. In fact, I believe the truth of the matter is, as Mr Husk
said, that he did not take the cattle off the land, although I do not doubt
that from time to time they may have been physically off the land in order to
go into the adjacent pasture which he also rented, but that he did not
purposely withdraw and that he lied about the matter to Mr Linington. No doubt
he thought at the back of his mind that he would be able to negotiate in due
course terms to his satisfaction with Mr Cox, but so far as Mr Scrace was
concerned and so far as Mr Linington was concerned, that land had been handed
back to Mr Cox.
Bernard
Thorpe’s efforts to dispose of Mr Cox’s land during the early summer were not
very successful; indeed, they were conspicuously unsuccessful. So the time came
when Mr Cox decided that he had better make the best of a bad job from Ibiza,
and he instructed Mr Scrace to make the best deal that he could with Mr Husk. I
have seen certain telegrams passing between Mr Cox and his agents which
confirm the state of affairs. The first, which was in early April, said, ‘Husk
has taken Weatherlees. Please advertise and let New Downs either graze the
whole or graze north and sell hay crop on south,’ clearly saying that Mr Cox
did not consider that Mr Husk had got any continuing tenancy. And then a later
telegram was sent in May, which said, ‘Confirm free to deal with Husk as you
see fit. Now too late to do otherwise but first please speak Holmwood Place
Farm Charing possibly take southern half. Disappointed Cox.’ So at the end of May, having received those
instructions, Mr Scrace reopened negotiations with Mr Linington. By this time
in fact the southern pasture had been let to another farmer, I think with a hay
crop; at all events, it was not available, so Mr Linington, on behalf of Mr
Husk, and Mr Scrace, on behalf of Mr Cox, negotiated for all that was
remaining, which was the northern pasture. They came to an agreement, which is
evidenced by a letter on page 100, dated June 12 and written to Mr Scrace by Mr
Linington, and it reads:
Dear Mr
Scrace, Land at Richborough Marshes. I write to confirm my telephone
conversation with you today, and set out below the terms which were agreed with
regard to the northern area of this marsh land. The rent shall be £500, with
the first half payable immediately, the second half payable on October 1 1974,
the tenancy to run until March 31 1975. Mr Husk to have no responsibility
whatsoever with regard to thistles. Mr Husk is to have the right to drive
cattle across the southern portion of the farm which he is not renting, for the
purpose of penning cattle by the entrance gate . . . I also confirm Mr Husk
will vacate Weatherlees on June 16, and he is arranging to have this done
within the course of the next day or so. I shall be seeing him on Saturday, and
he will give me a cheque for £288.50, which will be in respect of £38.50 for
Weatherlees up to June 16 and £250 being a half year due in respect of the
northern area. You will no doubt contact us if Weatherlees becomes available
for grazing on the same basis in the near future.
It is quite
clear from a subsequent letter written by Mr Husk’s agent that he regarded that
agreement as entitling Mr Husk to put his cattle back on the northern pasture,
because at page 110 of the correspondence a letter dated August 29 1974 written
by Mr Linington says on the second page:
On the whole,
our inspection reveals that this land is fairly well grazed and there is an
undoubted improvement in it since our inspection with Mr Scrace in the early
spring of 1973, and we cannot see the reason for any justifiable complaint. In
the context of the land itself, it must be remembered that Mr Husk did not have
an opportunity to enter until much later this year, and so we would suppose
that it would really have been possible to arrange for the spraying prior to
this, if your client had felt that the infestation was bad.
In fact, no
formal agreement was entered into between the two men that year, and so the
matter rested until the beginning of the next grazing season. Then Mr Cox had
the opportunity of a very, very much more advantageous letting of the north and
south pastures, of which he was anxious to take advantage, and he therefore was
not prepared to give the grazing to Mr Husk. In fact, a Mr Newing had come to
him and had offered him no less than £5,000 for the grazing on the whole of the
north and the south pastures in February 1975, which naturally enough Mr Cox
had accepted with alacrity. Suffice it to say that Mr Husk was very put out by
this, and he refused to remove his cattle from the northern pasture in 1975.
The result of it was that when Mr Newing, having paid over some £2,500 prior to
the commencement of the grazing season, found that he was only able to use the
southern pastures, he declined to pay any more, and Mr Cox accepted his
refusal. Mr Cox then commenced this action in order to recover possession of
the northern pasture.
The way in
which the defence was originally put was this, that in 1974 the letting of the
pasture was in fact for a tenancy running from April 1 1974 to March 31 1975;
that that was a protected tenancy; that no notice to quit had been given, and
accordingly that Mr Cox was not entitled to possession. The way in which Mr
Spence attractively argued that first defence was this. He said that looking at
the letter of June 12 1974, it is to be observed that it does not give any date
at which the tenancy is to commence, but merely a date to which it is to run,
but that looking at the background of the matter, and in particular at the fact
that in previous years there had been a tenancy expressed in the formal
agreement to run from April 1 to March 31, it must have been in contemplation
of the parties that the arrangement of June 12 was in fact a letting of the
north pasture from April 1, and that accordingly it was not an exempt letting
within the proviso to section 2. I am afraid that I cannot accept that submission.
It seems to me abundantly clear that there was a real, fundamental rethinking
by Mr Cox about the basis upon which he was prepared to let the land that year.
He set out his offer in the clearest terms to Mr Husk in relation to the three
different parcels in the letter in March from Fontainebleau to which I have
already referred. Mr Husk only chose to accept the offer of a tenancy of a very
different and limited nature to that which he had previously enjoyed in
relation to Weatherlees. He did not want to accept the offer in relation to the
north and south pastures, and accordingly he should have removed his cattle. It
is quite manifest that Mr Husk must have appreciated that. There would have
been no other purpose for him to lie to his own agent, as he did in the latter
part of April, when he told his agent that the cattle were on the northern
pasture only as a result of having escaped from the National Trust land which
he was renting adjacent thereto. Both Mr Cox and Mr Scrace vehemently reacted
to the suggestion that they intended to let the land from April 1 when it was
put to them in the witness-box, and they pointed out forcefully that it was
wholly inconsistent with their attempts to let the land between the time that
Mr Cox rejected the offer at the end of March and the resumption of
negotiations towards the end of May. In my view, it is impossible to regard the
negotiation that was finally concluded on June 12 as other than an agreement to
let the northern pasture from that date until March 31 1975. That being so,
this was clearly a letting for grazing for a period of less than a year, for
which no protection can be claimed.
That, in
truth, is enough to dispose of liability in this case, but I feel that I should
express a view on certain other arguments that have been advanced in this case,
because the second way in which Mr Spence put the case by way of amendment is
this, that certainly as from the year 1973-74, and possibly also, I think,
1972-73, there was a protected agricultural tenancy, because the lettings in
these years were for a period of one year certain, and therefore do not fall
within the proviso. Founding himself on that, Mr Spence goes on to argue that
what occurred on June 12 1974 was no more than a variation of that
previously-established protected agricultural tenancy, either in 1972-73 or
1973-74. That is put shortly, but I hope it does justice to his point. He
concedes, however, that that argument must fall if the agreement of June 12
cannot properly be regarded as a variation of a tenancy but as a new tenancy,
because if it is a new tenancy, then it follows that even if there were
previously a protected tenancy it would be surrendered by operation of law. I
am grateful to Mr Spence for drawing my attention to the case of Jenkin R
Lewis & Son Ltd v Kerman [1971] Ch 477, from which it may be
culled that the mere fact that there is an alteration in rent, or the mere fact
that there is an alteration in the actual holding let, does not necessarily
mean that the new instrument is to be regarded as a new agreement rather than a
variation of an old one, and I bear that
the spring and summer of 1974 as leading up to the variation of an agreement.
If there was an agricultural tenancy established in 1973-74, it was a tenancy
for all three parcels of land. Mr Spence concedes that so far as the southern
part of the land is concerned, there must at some time have been a surrender of
the southern portion of the land prior to the agreement in June 1974. He also
concedes that there must have been a surrender of the agreement relating to
that parcel of land known as Weatherlees. He did not seek to argue that the
acceptance of the offer for Weatherlees constituted a variation of an
agricultural tenancy established in 1973-74. He accepted it as a surrender. It
seems to me that it would be quite unreal to regard the agreement in relation
to the northern part as being a variation, when it is accepted that the
negotiations in relation to the other two parts resulted in surrenders. The
truth of it is that I do not think this was a variation at all. They were
entirely fresh negotiations against a fresh background, resulting in a new
agreement, and by accepting that new agreement Mr Husk surrendered whatever
tenancy he might have held the previous year.
Because this
entirely new way of putting the case faced the plaintiff on the day of trial, I
gave leave to the plaintiff to serve a reply claiming rectification of the
agreement in which the letting was expressed to be from April 1 to March 31.
Now there is no doubt that Mr Spence is right when he says that when that
agreement was drawn up, and in particular when the letter at p 64 which was
drafted by Mr Scrace relating to the 1972-73 agreement came into being, Mr
Scrace intended to put ‘April 1 to March 31’ because he believed, erroneously,
that that constituted a 364-day letting and was consequently not caught by the
Act but fell within the proviso to section 2. Mr Langdon-Davies has frankly
admitted that Mr Scrace was in error in that belief, and so, says Mr Spence,
this having been a quite deliberate insertion of dates, no question of
rectification can arise. But for my part, if it were necessary to decide the
point, I should decide it otherwise. I think it would be a blot on the law if,
through a slip of an adviser of that sort, a situation was created that was
neither contemplated nor intended by either of the parties to the transaction.
I have already expressed the view that I am satisfied that neither Mr Cox nor
the defendant had the slightest intention of creating any protected
agricultural tenancy. Indeed, they were going out of their way not to, and if
it had been necessary, I would have allowed rectification of any instrument
necessary to express the true intention of the parties, by altering the date
March 31 to an appropriate date, so that the period was less than the full 365
days. However, on the view of the facts that I take, it is not necessary for me
to grant rectification in this case, but I thought I ought to express my view
in case the matter goes further.
The final
remaining point is as to the quantum of damages to which Mr Cox is entitled. In
fact, Mr Cox is £2,500 out of pocket because of Mr Husk’s refusal to give up
the northern land during last year, but Mr Langdon-Davies, who put the case on
the basis of a loss of mesne profits, has, on Mr Cox’s instructions, limited
the claim to one of £2,000. Looking at the evidence as a whole, I am satisfied
that the southern pasture was rather more valuable than the northern pasture.
The figure put to Mr Scrace as a fair value of the northern pasture was about
£9 an acre. The arithmetic in fact came out as making it rather less than the
agreed figures of its acreage now show. Its acreage is in fact 242 acres,
although perhaps it is fair to say that some 30 acres of that was very poor
land, being reeds and thorns on which cattle could not properly graze. Mr
Scrace said that he thought it was worth rather more than that, and I think that
looking at the matter broadly and doing the best I can, a value of £2,000 is a
fair value to take for the northern pasture, and that is the sum for loss of
mesne profits to which I hold that Mr Cox is entitled because Mr Husk
wrongfully held over on this land throughout the whole of the last grazing
season. There remains in issue a dispute between the parties as to certain
damage that has been done by cattle to Mr Cox’s land. I am not asked to deal
with that, and I shall refer that for assessment to a master if the parties
cannot agree a sum between them.
An order was
made in the terms indicated by his Lordship. Possession was directed to be
yielded up within 28 days, and the plaintiff was awarded costs.
