Agricultural Holdings Act 1986 — Notice to quit — Case B in Schedule 3 to the 1986 Act — Landlord’s right to recover part of the holding for a non-agricultural purpose — Planning permission not required ‘otherwise than by virtue of any provision of those enactments’ — Notice given to recover farmhouse on holding — Appeal from decision of county court judge holding (contrary to view of arbitrator) that the notice was not within Case B — Doubt raised by Ministry of Agriculture, Fisheries and Food v Jenkins
agreement provided for the recovery of any part of the holding (not exceeding 5
acres) for a non-agricultural purpose — The agricultural holding had been added
to one which the tenant already held from the same landlord — There was a
farmhouse on it which the tenant did not require to use and, by virtue of a
licence in his tenancy agreement, he let it for residential (non-agricultural)
purposes — The landlord now sought possession of it and gave the tenant a
notice to quit, relying on Case B — The landlord presumably wished to let it
himself for residential purposes — The question was whether the notice to quit
in these circumstances was within Case B
the circumstances appeared plainly to be covered by Case B — The land was
required for a use other than for agriculture in accordance with a provision in
the tenancy agreement — The use was one for which, otherwise than by virtue of
any provision in the planning enactments, permission was not required — It was,
however, suggested on behalf of the tenant that the decision of the Court of
Appeal in Ministry of Agriculture, Fisheries and Food v Jenkins raised a doubt or
question on the subject — The Jenkins decision itself was based on the Crown
exemption and appeared to have no bearing on the present case — In the course
of his judgment, however, Lord Denning MR had said, with reference to what is
now para (b) of Case B, ‘the reason must be by virtue of some extrinsic good
reason and not by virtue of any provision in the Planning Acts’ — It was
submitted that ‘some extrinsic good reason’ envisaged something more specific
than the fact that here was a use which did not require planning permission,
but apart from the Crown exemption in the Jenkins case itself no example of
anything specific was put forward — Stocker LJ suggested that Lord Denning used
the word ‘extrinsic’ merely in contrast with a provision intrinsic to the
planning Acts, namely, section 12(2)(e) of the Act then in force (Town and
Country Planning Act 1947)
held that the judge below had fallen into error in thinking that the Jenkins
case cast any doubt on the application of Case B to the present case or that it
decided that Case B (b) covered only the Crown exemption — O’Connor LJ pointed
out that they were not deciding what the position would be if a landlord chose
to try to use a part recovery clause to dispossess a farmer who was living in
his farmhouse — That was not this case, where the farmhouse had been used for
residential purposes — Appeal from county court judge allowed
The following
case is referred to in this report.
Ministry of Agriculture, Fisheries and
Food v Jenkins
[1963] 2 QB 317; [1963] 2 WLR 906; [1963] 2 All ER 147; [1963] EGD 422;
(1963) 186 EG 179, CA
This was an
appeal by the landlord from a decision of Judge Boothman, at Bath County Court,
who had allowed an appeal from
Norman Walter Bell, on the effectiveness of a notice to quit served on the
tenant, Colin McCubbin, requiring possession of the farmhouse at Cherry Orchard
Farm, Farleigh Wick, Bradford on Avon. Judge Boothman had set aside the award.
John Virgo
(instructed by McCloy & Co, of Bradford on Avon) appeared on behalf of the
appellant landlord; Gregory Treverton-Jones (instructed by Burges Salmon, of Bristol)
represented the respondent tenant.
Giving
judgment, O’CONNOR LJ said: This is an appeal from a decision of His Honour
Judge Boothman at the Bath County Court on March 20 of this year. He allowed an
appeal from an award of an arbitrator under the Agricultural Holdings Act,
finding in favour of the landlord who had served a notice to quit on the tenant
for part of the agricultural holding. The tenancy agreement included a partial
recovery clause to be found in clause 3(1):
The landlord may at any time or times on
giving three calendar months’ notice in writing terminating on any quarter day
of his intention so to do resume possession of any part or parts of the farm
(not exceeding 5 acres) for any of the purposes or objects set out in section
31 of the Agricultural Holdings Act 1948 or for any other purpose not being the
use of the land for agriculture.
It was under the provisions of that
clause that the landlord gave notice to recover a farmhouse on this holding.
The notice to quit takes effect on September 29 of this year.
The tenant
objected and applied for arbitration. Two points were raised: first of all, the
sufficiency of the notice to quit; that has been determined in favour of the
landlord by the arbitrator and upheld by the judge and there is no appeal from
that finding. Second, the tenant objected that the matter was not governed by
Case B of the Third Schedule to the Agricultural Holdings Act 1986.
The provisions
for recovery of land held on agricultural tenancies have been strictly enforced
by the courts and, as Mr Treverton-Jones in a clear argument has put before us,
there are two streams of recovery. There is the normal method of giving notice,
limited as it is by the terms of the statute, and getting consent of the
tribunal to the order for possession and there are discretionary and other
controls available. Alongside that there is a limited stream of situations
where the landlord can recover possession without going through the net of the
tribunal, and the question in this case is a short one: is this such a case?
The facts so
far as they are relevant can be stated very shortly. This particular
agricultural holding was added to one which the tenant already held from the
same landlord. It had a farmhouse on it which he did not want to use as a
farmhouse, and in the result he got a licence written into the agreement to
allow him to let it, which he did, for people to live in. It is in respect of
that farmhouse that the notice was given. The landlord presumably wants to let
it himself.
It is in those
circumstances that the notice was given and the short question is: is it within
Case B? The arbitrator held that it was
and the learned judge has held that it is not. Schedule 33 is headed: ‘Cases
where consent of tribunal to operation of notice to quit is not required’ and
is a provision under section 26 of the 1986 Act. Section 26 provides:
(1)
Where —
(a) notice to quit an agricultural holding or
part of an agricultural holding is given to the tenant, and
(b) not later than one month from the giving of
the notice to quit the tenant serves on the landlord a counter-notice in
writing requiring that this subsection shall apply to the notice to quit,
then, subject to subsection (2) below,
the notice to quit shall not have effect unless, on an application by the
landlord, the Tribunal consent to its operation.
(2) Subsection (1) above shall not apply in any
of the Cases set out in Part I of Schedule 3 to this Act; and in this Act ‘Case
A’, ‘Case B’ (. . .) refer severally to the Cases set out and so named in that
Part of that Schedule.
I turn to
Schedule 3, Case B:
The notice to quit is given on the ground
that the land is required for a use, other than for agriculture —
(a) for which permission has been granted on an
application made under the enactments relating to town and country planning, or
(b) for which, otherwise than by virtue of any
provision of those enactments, such permission is not required,
and that fact is stated in the notice.
For the tenant
it is submitted that the landlord does not bring himself within those
provisions. It is accepted that this is a case for which planning permission is
not required. The use to which the landlord proposes to put the house is for
residential purposes: that is a use to which it has been put for a long time.
It has not had a farmer living in it, and it is said by the landlord that the
words of the section plainly are in his favour and the arbitrator so found. The
reason that any doubt has been raised about it, because in my judgment that
argument is right — the words are plain and this case is plainly covered by
them — derives from the case of Ministry of Agriculture, Fisheries and Food
v Jenkins [1963] 2 QB 317. There the Crown wanted to change the use of
extensive land in Wales from sheep grazing to afforestation, and the question
was as to whether that was within this Case. (The Case was then incorporated in
section 24(2) of the 1948 Act, but the wording is exactly the same.) The court held that it was within the Case,
but not because planning permission was not required because the facts did not
fall within the words of para (b). The exemption from planning
permission was because the Crown was above all the planning Acts. But for that,
as the court pointed out, Case B would not have applied because the exemption
was found in section 12(2)(e) of the Town and Country Planning Act 1947,
which said that a change of use from agriculture to afforestation should be
exempt. It was therefore within the exemption to para (b).
Jenkins’ case,
in my judgment, has no bearing on the present facts and little help is to be
derived from it. Mr Treverton-Jones, however, has quite properly drawn our
attention to what Lord Denning said when dealing with this at p 324:
That is a provision which I find
difficult to follow. But it means, I think, that a landlord does not have to
get the consent of the Agricultural Land Tribunal if: (a) he requires the land
for a non-agricultural use; and (b) in addition he shows either (i) that he has
got permission under the Planning Acts so to use it, or (ii) that he does not
require permission under the Planning Acts. But, in a case under (i) where he
already has got planning permission, he must have made a specific application
for non-agricultural use and have been granted specific permission for it. The
general permission under the General Development Order 1950 will not do and in
a case under (ii) where he does not require permission for the non-agricultural
use, the reason must be by virtue of some extrinsic good reason and not by
virtue of any provision in the Planning Acts.
Mr
Treverton-Jones submitted that some extrinsic good reason must be something
specific other than the general provision that here is a use which does not
require planning permission. Although the construction which I think is
absolutely plain may cause difficulties, it does not do so in this case, and
whether it does in others we are not deciding; for example, we are not deciding
what the position would be if a landlord chose to try to use a partial recovery
clause to dispossess a farmer who was living in his farmhouse. That is not this
case and we are not deciding it. In the present case it is accepted that the
use to which the house was being put before the notice to quit was given was
that it was for residential purposes. That is the use to which it will be put
in the future. It is a non-agricultural use for which the landlord wants it now
and it falls fairly and squarely within the Case. The learned judge came to an
opposite conclusion, because in my judgment he fell into error in misconstruing
the effect of the Jenkins case. He came to the conclusion and he said:
It is plain that the authors of all the
textbooks on the Law of Agricultural Holdings have interpreted [the decision in
Jenkins] to mean that clause (b) of Case B can really only arise
in situations like the Jenkins case ie where the Crown is the landlord.
We have been
referred to the relevant paragraphs in Woodfall and in Hill and
Redman and Jenkins is cited for what it says, but the authors make
no comment on the situation which has arisen in the present case and no help is
to be derived from their views on the law on this topic because none is
expressed.
As I have
said, I think the learned judge fell into error in thinking that the case was
governed by Jenkins and for the reasons which I have given I would allow
this appeal.
Agreeing,
STOCKER LJ said: It seems to me that on this appeal only two questions arise.
First, do the words used in Case B (b) of Schedule 3 cover a case where
planning permission is not required at all as a matter of proper construction
of those words themselves? Second, if
the answer to that question is ‘yes’, is the construction restricted by reason
of the decision of this court in the case of Ministry of Agriculture,
Fisheries and Food v Jenkins [1963] 2 QB 317, which is a case
binding upon us? It is common ground
that planning permission is not required by reason of the fact that there is no
change of use. Accordingly, the planning legislation does not apply to this
situation. Thus far, that is a matter of common ground.
It is
contended by the respondents that the words ‘otherwise than by virtue of any
provision of those enactments’ must be limited to
permission is not required, or by virtue of the fact that the Crown is the
landlord concerned. As a matter of construction of the words used, I do not
think that any such limitation can be placed upon it.
The next
question is: is that construction in any way restrained by the decision in the Jenkins
case? Reliance is placed upon the dicta
of the Master of the Rolls, Lord Denning, at p 324 where he says:
And in a case under (ii) where he does
not require permission for the non-agricultural use, the reason must be by
virtue of some extrinsic good reason and not by virtue of any provision in the
Planning Acts.
It seems to me that in using the word
‘extrinsic’ there, Lord Denning was concerned with the case where a landlord
was exempt from the provisions of the planning legislation by virtue of section
12(2)(e) of the Planning Act then in force. That was a case which would
clearly have fallen as an exemption by virtue of a provision of those
enactments, and it was in that sense that he was using the word ‘extrinsic’.
Accordingly, I
share the view of O’Connor LJ that that decision does not bear upon the
question which we have to decide. For the reasons given by O’Connor LJ, I agree
that this appeal should be allowed.
The appeal was allowed with costs;
application for leave to appeal to the House of Lords was refused.
