Agriculture (Miscellaneous Provisions) Act 1976 — Application of section 21 in the case of an applicant who is not fully eligible because the condition specified in paragraph (b) of the definition of ‘eligible person’ in section 18(2) of the Act is not fully satisfied — To be ‘treated’ as eligible in such a case the condition in paragraph (b) must be satisfied ‘to a material extent’ — Condition in paragraph (b) requires the applicant’s only or principal source of livelihood for five years to have been derived from his or her agricultural work on the holding — Analysis of tribunal decisions which included interpretations of ‘material extent’ ranging from ‘only just failing to qualify as eligible’ to ‘substantial in terms of time and important in terms of value’ — Obiter dictum by Lord Russell in Jackson v Hall that section 21 applied to a person ‘who does not quite fulfil’ the eligibility requirement explained — The tribunal in the present case considered that an applicant must ‘almost fulfil’ the condition in paragraph (b) of the definition of eligibility — On this principle they rejected the applicant, part of whose livelihood had been derived from nursing — Held that the tribunal had taken too narrow a view — The judge adopted the formulation of the tribunal in Dagg v Lovett, ‘substantial in terms of time and important in terms of value’ — Case remitted to tribunal with a direction to find that the applicant was a person to whom section 21 applied and to consider whether it would be fair and reasonable for her to be able to apply under section 20.
This was an
appeal by case stated from the East Midland Agricultural Land Tribunal by Mrs
Edna Ada Littlewood. She challenged the dismissal by the tribunal of her
application to be treated as an ‘eligible person’ under section 21 of the
Agriculture (Miscellaneous Provisions) Act 1976. The respondents were the
landlords, Thomas Donald Rolfe and Rita Rolfe, and the holding which was the
subject of the application consisted of five fields, amounting to 26.774 acres,
at North Leverton with Habblesthorpe and South Leverton in the County of
Nottingham.
H Richards
(instructed by Hancock & Willis, agents for Hodgkinson & Tallents, of
Newark) appeared on behalf of the applicant; C B Priday (instructed by
Collyer-Bristow, agents for Hayes, Son & Richmond, of Gainsborough, Lincs)
represented the respondents.
Giving
judgment, JUDGE EDGAR FAY said: This is an appeal by way of case stated from
the Agricultural Land Tribunal for the East Midland Area. The appellant, Mrs
Edna Ada Littlewood, had applied to that tribunal for a declaration that she
should be treated as an eligible person to apply to succeed to the tenancy of
an agricultural holding formerly held by her husband, who had died on June 13
1979.
The tribunal
heard her application on April 2 1980 and dismissed it. The appeal requires
this court to pronounce upon the interpretation of a section of the Agriculture
Acts which has caused controversy and has led to differing decisions by
different tribunals.
The matter
arises in this way. Section 20 of the Agriculture (Miscellaneous Provisions)
Act 1976 confers upon certain relatives of a deceased tenant of an agricultural
holding the right to apply for a declaration entitling him to a tenancy of the
holding. If the applicant is what the Act calls an ‘eligible person’ the
tribunal has to decide whether he is, in their opinion, a suitable person to
become a tenant of the holding. If they decide that he is, then, subject to
certain qualifications irrelevant to this decision, they give a declaration
entitling him to a tenancy. The applicant has thus to be both eligible and
suitable.
Eligibility is
defined in section 18(2) of the Act. It requires the satisfaction of three
conditions. The first is relationship to the deceased (the list of relatives
includes the widow). The third is that the applicant is not the occupant of a
commercial unit of agricultural land; this is not in question here and it is
agreed that the first and third conditions are satisfied. The second condition
is that:
(b) in the seven years ending with the date of
death his only or principal source of livelihood throughout a continuous period
of not less than five years, or two or more discontinuous periods together
amounting to not less than five years, derived from his agricultural work on
the holding or on an agricultural unit of which the holding forms part;
This condition
has two elements. One, that the applicant’s only or principal source of
livelihood has been derived from his work on the holding; the other, that this
derivation of livelihood has enured for five years.
In the present
case this condition is not satisfied. There is a shortfall in the period and
there may be a difficulty over the principal source of livelihood point. But
Parliament has provided for cases where the second condition is not fully
satisfied; this is by section 21 of the Act. Its somewhat convoluted provisions
provide that on application under the section the tribunal has power to
determine that the applicant is an eligible person. They must exercise this
power in the applicant’s favour if they are satisfied that he is a person to
whom the section applies and also that in all the circumstances it would be
fair and reasonable for the applicant to be
tenancy of the holding. Subsection (1) enacts that the applicant is a person to
whom the section applies if the first and third conditions of the definition of
eligible person in section 18 are satisfied and if:
(b) the condition specified in paragraph (b) of
that definition, though not fully satisfied, is satisfied to a material extent.
The result of
all this verbiage is that one who fails to pass the second condition may,
nevertheless, be deemed to pass. But if he does, a further hurdle is placed in
the way, namely, the need to show that it is fair and reasonable to make the
order. Now this deemed eligibility depends upon whether the second condition is
‘satisfied to a material extent’ and what I have to determine in this case is
what those deceptively simple words mean.
Let me now go
back to the facts on the findings. Attached to the tribunal’s stated case is
the tribunal’s written decision and scheduled to that decision is the
tribunal’s written findings and reasons. In paragraph 1 of this schedule the
tribunal sets out its findings of fact in 11 numbered subparagraphs, as
follows:
i. the
applicant is a woman aged 40. Michael Jack Littlewood (‘the deceased’) was her
husband and died on June 13 1979 aged 39;
ii. Thomas
Donald Rolfe and Rita Rolfe (‘the landlords’) granted the deceased a tenancy of
five fields at North Leverton with Habblesthorpe and South Leverton in the
County of Nottingham (‘the holding’). The holding was 26.774 acres and the
tenancy commenced on October 1 1975;
iii. the
deceased or the applicant
it should be
‘the deceased and the applicant’
also owned a
further almost 25 acres of land in the same area. That land was an agricultural
unit of which the holding forms part. The holding and that agricultural unit
are collectively called ‘the farm’;
iv. the
deceased and the applicant together with two children they then had moved to
the area from London in the summer of 1975. The deceased then worked full time
on the farm until the latter part of 1978 when he obtained employment as a
nurse. The applicant had worked as a pupil nurse at the Royal Free Hospital in
London training to become a state enrolled nurse;
v. throughout
the period between October 1 1975 and June 13 1979, some 44 1/2 months, the
applicant did agricultural work on the farm;
vi. between
October 1 1975 and June 13 1977, some 20 1/2 months, the applicant was working
either full time or part time at Workshop Victoria and Kilton Hospital (‘the
hospital’);
vii. between
October 1 1975 and October 31 1976 the applicant worked full time either as a
pupil nurse or as a state enrolled nurse. She was earning between October 1
1975 and July 31 1976 at the gross annual rate of £1,953, and for a very short
period between August 1 1976 and August 20 1976 at the gross annual rate of
£2,052, and between August 20 1976 and October 31 1976 at the gross annual rate
of £2,184. The applicant ceased being a pupil nurse in May 1976. The tribunal
presume that was at the end of May, a period of eight months since October 1
1975;
viii. between
November 1 1976 and June 13 1977 the applicant worked part time (half the
normal working hours) at the hospital earning at the gross annual rate of
£1,092;
ix. for
exactly two years as it turned out the applicant worked on the farm without
having earnings from any other employment;
x. the deceased’s drawings from the farm were as follows:
|
i. year ended March 31 1976 |
£1,565.34 |
|
ii. year ended March 31 1977 |
£1,918.46 |
|
iii. year ended March 31 |
£2,009.97 |
|
iv. year ended July 31 1979 |
£1,608.85 |
xi. the applicant is a courageous and industrious woman, who much
impressed the tribunal as a witness. She had worked hard on the farm despite
her other employment as a nurse, despite the birth of her third child, David,
born on September 24 1977, and despite the untimely and sudden death of her
husband, the deceased.
Pausing there;
it is clear that the period during which the applicant derived her livelihood
wholly or partly from the farm was 44 1/2 months as against the 60 months
required by the second condition of eligibility. Throughout that period she is
found, as a fact, to have worked hard on the farm. She and her husband derived
their livelihood partly from the farm and partly from nursing. The livelihood
aspects may be divided into three periods. Firstly, from October 1 1975 to June
13 1977, when the husband is working full time on the farm and the wife is
working part time on the farm. Secondly, from June 13 1977 to what is called
‘the latter part of 1978’, when both were working full time on the farm, and,
thirdly, from the latter part of 1978 down to June 13 1979, the date of the
husband’s death, when the wife was working full time and the husband part time
on the farm. The joint livelihood of husband and wife was derived wholly from
the farm during the second period. During the first period it would seem to
have been derived almost equally from the farm and from the wife’s nursing. We
are not told what the husband earned when nursing for the last six or seven
months of his life, but the proportions derived from the two pursuits are
likely to have been similar to the period when it was the wife who was nursing.
The case
stated makes, in paragraph 7, a further finding, namely, that ‘livelihood’
might include other means of support such as the provision of food, clothing
and shelter and that that other means of support was present only to a very
small and limited extent. This I take to refer to the shelter of the farmhouse
and to such foodstuffs as came off the farm.
Upon these
facts the tribunal decided by a majority that the applicant’s principal source
of livelihood did not come from her work on the farm during any period in which
she worked full or part time as a nurse. They went on to consider, under
section 21, whether the second condition had been satisfied to a material extent
and they said this, in paragraph 6 of their findings:
6. The
decision of the tribunal by a majority was:
i. That the
specified condition could be satisfied under section 21(1)(b) of the Act only
if the applicant almost fulfilled its requirements. The tribunal was referred
to the speech of Lord Russell in Jackson v Hall [1980] 1 All ER
177 at 189, where he said this about section 21:
‘Section 21 in
effect enables the tribunal to treat as an eligible person ‘any survivor of the
deceased’ who does not quite fulfil the earlier requirements for eligibility
related to the activities of the applicant during the seven years preceding the
death of the tenant’;
ii. the test
of satisfaction of the specified condition to a material extent under section
21(1)(b) of the Act must be applied by considering:
a. the length
of the continuous period during which the applicant’s principal source of
livelihood derived from her agricultural work on the farm;
b. the
proportion of the applicant’s livelihood derived from her agricultural work on
the farm and derived, on the other hand, from her work elsewhere during any
period when her principal source of livelihood was not derived from her
agricultural work on the farm;
iii. that even
if the applicant’s principal source of livelihood derived from agricultural
work on the farm throughout the whole period from October 1 1975 until June 13
1979, nevertheless, as that period was less than 75 per cent of the required
period of five years the specified condition was not satisfied to a material
extent;
iv. that on
the facts found the only period during which the applicant’s principal source
of livelihood derived from her agricultural work on the farm was the period of
two years from June 13 1977 until June 13 1979.
The crucial
part of this finding is the holding that ‘satisfied to a material extent’ means
‘almost fulfilled’. If that is its meaning, their decision must clearly be
right. But, Mr Hesketh Richards, for the appellant, contends that a much wider
meaning should be attached to the phrase. Both he and Mr Christopher Priday,
for the respondents, helpfully put before me certain decisions of other
agricultural land tribunals touching on the interpretation. These are, of
course, not binding on me, but I find it helpful to see how other minds have
approached this question.
Before I come
to them, however, I would deal with the tribunal’s reference to what Lord
Russell of Killowen said in Jackson v Hall. That was a case which
went to appeal on the meaning of the third of the three conditions of
eligibility together with the question of the date at which the applicant had
to be eligible. It was in no way concerned with the interpretation of section
21. Lord Russell, whose words on the subject are quoted in full in the passage
I have read from the tribunal’s findings, was referring to the section by way
of what he described as a summary of the statutory provisions. Lord Fraser of
Tullybelton did the same at p 185, where he summarised the second condition and
added:
. . . though
that condition may be relaxed by the tribunal under section 21(1)(b) if it has
been not fully satisfied but satisfied to a material extent.
Lord Russell’s
words can have no binding effect in these circumstances. The words themselves
are not open to controversy if they
implied assertion that one who goes beyond a ‘not quite’ test is outwith the
section. Lord Russell did not say that, although it may be that this was in his
mind on first impression and without argument upon the point.
Tribunals
have, however, been wrestling with section 21 and hearing argument upon it for
some time. I was referred to four decisions. In Judge v Umpleby
(Deceased) in July 1978, the Yorkshire and Lancashire Area Tribunal had
this to say in paragraph 22:
. . . It was
accepted by Mr Maguire that the provision in section 21(1)(b) of the Act that
this condition need only be satisfied to a material extent applied not only to
the period during which the applicant’s source of livelihood had derived
from her work on the holding, but also to the extent to which her
livelihood had so derived. In other words, he accepted that it would be
sufficient for the applicant to show that throughout the period in question —
or some material part thereof — a material source of her livelihood had derived
from her agricultural work on the holding, although it fell short of being her
only or principal source of livelihood. In making this concession, Mr Maguire
said that he did so in the light of section 21(6) of the Act. In the view of
the tribunal this concession was rightly and properly made, and represented a
correct interpretation of the relevant law.
In paragraph
31:
31. The
tribunal did not consider it possible or realistic to make any precise mathematical
calculation of the extent to which any of these other benefits could be said to
have been attributable to the applicant’s work on the holding. Accordingly it
was in our view impossible to say that we were satisfied that for at least five
out of the seven years ending with her father’s death the applicant had derived
her principal source of livelihood from her agricultural work on the
holding. However, we were quite satisfied that for at least five of these years
she had derived a material source of livelihood from her agricultural
work on the holding or (to put it in a slightly different way) had derived her
livelihood from such work to a material extent. In other words, but for the
rewards in cash and kind that she received for her agricultural work on the
holding, she would have been materially worse off throughout this period.
Next is Dagg
v Lovett, in February 1979, where the Northern Area Tribunal said, in
paragraph 29 of the decision:
29. This
section
that is to say
section 21(2)
of the 1976
Act provides for applicants to be treated as eligible where they cannot show
that they fully satisfy the requirements of section 18(2)(b) but can show that
they satisfy these requirements to a ‘material’ extent. What then is to be
taken to be the interpretation of the word ‘material’ in this context? Mr Price suggested that it was to be taken to
mean ‘more than minimal’; ‘there was’, he said, ‘salt in seawater to a material
extent in the ordinary meaning of the word’. The tribunal did not take this
view. It surely could not be the intention of the Act that applicants who
clearly fail to pass the first hurdle should be admitted under this section. If
it were, what would be the value of the test at 18(2)(b)? Its effect would be stultified. This tribunal
take the view that the meaning to be given to the word ‘material’ in this
section is ‘substantial in terms of time and important in terms of value’.
In Colson
v Midwood, in June 1979, the Eastern Area Tribunal adopted a narrower
construction. At paragraph 14(4) of their decision they said:
‘The
condition though not fully satisfied is satisfied to a material extent’
(section 21(1)(b)). This provision is applicable both to cases where there is a
failure to satisfy section 18(2)(b) as to proportion of livelihood coming from
agricultural work and to the period. There have been conflicting decisions but
in our opinion section 21(6) makes the matter clear. As to what is a material
extent — either as to amount or period — we do not think that this means that
the source of livelihood must be shown to be only just below 51 per cent or the
period to be very nearly 60 months. But on the other hand we do not think it is
enough for an applicant to show merely that a ‘substantial’ proportion of his
(or her) livelihood has come from agricultural work or, as the case may be,
that such has been the position for a substantial part of the full five-year
period. If this had been all that was required the section could, and indeed
surely would, have been quite differently and much more simply worded. Again
hard and fast lines cannot be drawn but in our opinion though an applicant need
not show that he (or she) has come ‘within a hair’s breadth’ of full compliance
it must be shown on the facts that there has not been a really large failure.
Finally, in Clark
v Bernard, in March 1980, the South Eastern Area Tribunal said:
The personal
aspects of hardship that may ensue from the decision were not, in the
tribunal’s view, relevant to this application and therefore attention was
devoted to deciding whether the conditions specified in section 18(2)(b) of the
Act were satisfied to a material extent. This was not easy. It was felt that it
should not be done solely on the basis of any mathematical percentage or
proportion. It was also felt that it would be unwise to do anything other than
to consider the meaning of the word ‘material’. That is the word in the Act and
if Parliament had wished to substitute some other word it would have done so.
It is not proposed to enter into any lengthy discussion on what ‘material’, in
the context in which it is used, could otherwise mean. Certainly other meanings
could be attempted. Definitions in the Oxford Dictionary include: ‘of
much consequence’ and ‘important’. If this is the right approach, it has to be
considered, on the facts of this case, whether Mr Clark has brought himself, to
the tribunal’s satisfaction, within the conditions of section 18(2)(b), to a
material extent.
There has thus
been a whole gamut of interpretation, from the strict ‘only just failing’ view
of the tribunal in the present case, to the wide interpretation accorded in Dagg
v Lovett. This underlines the difficulty of the task of interpretation,
and when I find the late Lord Dilhorne, at p 183 in Jackson v Hall,
saying: ‘My Lords, it is to be regretted that this lengthy and no doubt
expensive litigation has been brought about the inadequacy of the drafting of
this Act’, I feel disposed, respectfully, to echo his sentiments.
‘Satisfied to
a material extent’. It is a strange phrase. ‘Extent’ presents no difficulty;
nor does ‘satisfied’ in the context although it is a misuse of the word to
apply it to a condition which, ex hypothesi, is not satisfied. The crux
of the question is the word ‘material’. It is an adjective frequently used by
lawyers — they speak of material facts, of material considerations. In this
sense it means relevant to the matter in hand, but it can hardly mean relevant
here. It has another sense — of something substantial, more than minimal; that
seems to have been the path followed by the Northern and Yorkshire and
Lancashire Tribunals.
Mr Priday
argues that because this litigation takes away a landlord’s right to possession
it ought to be narrowly construed. On the other hand the policy of Part II of
the Act is clearly to create new rights in deserving persons with a view, I
would think, to preserving that family continuity which has long been a feature
of English farming life. It can equally well be argued that a wide construction
is needed to give effect to the policy of the Act.
I do not find
either of these approaches compelling. I do, however, find some assistance in
subsection 2(b) of section 21, the paragraph setting up the further hurdle to
the successor tenant of whether the order is fair and reasonable. I think this
points to a wide interpretation of the ‘material extent’. If the ‘not quite’
view were right and the let-out consisted of what may be called ‘the hard-luck
cases’ (where the applicant has 59 months instead of 60; or 49 per cent in
livelihood instead of the 51 per cent which would make it the principal source)
then it is difficult to see how any tribunal could find that it was not fair
and reasonable to make the order bearing in mind that the applicant still has
the final hurdle of suitability to surmount. On the other hand, if jurisdiction
is given over a wide spectrum of facts by a beneficial interpretation of the
word ‘material’ the tribunal will have a real task in deciding where lies
fairness and reasonableness.
I therefore
find that the tribunal erred in law in following the narrow interpretation. But
I must go beyond this and endeavour to afford some guidance for those who have
to solve these difficult problems. I agree wholeheartedly with the view that no
mathematical formula can be laid down. Percentages of fulfilment, when worked
out, are a useful guide to put the facts of finance or of time in perspective
and to help judge their weight, but I would think it wrong to try to impose a
mathematical cut-off point to what is material. After considerable casting
about I do not feel that I can do better by way of definition than to adopt
what the Northern Area
‘substantial in terms of time and important in terms of value’.
The case
stated in the present appeal asks me to say whether an applicant can satisfy
the requirements ‘to a material extent’ if the period of the tenancy itself was
less than 75 per cent of the period of five years. It was in fact 44 1/2 months
against the 45 months which would be 75 per cent. My answer to that question
is: ‘Yes’. I can envisage that 50 per cent could well, in some circumstances,
be satisfaction to an extent that was material in the sense of substantial.
Here a young couple took on a farm — no doubt hoping to make their permanent
home there and bring their children up there. These are relevant facts when
considering whether the period is deemed to be satisfied.
The tribunal
pose a similar question as regards principal source of livelihood. I do not
think one can approach the question of source of livelihood of husband and wife
in two separate compartments. Husbands and wives usually pool their income.
Here the husband and wife had two sources of income between them for part of
the time and one source only, namely the farm, for another part. The figures in
this case show that an important part of the joint income at all times was the
farm and I entertain no doubt that, applying the interpretation I have to the
word ‘material’, this applicant has brought herself within section 21.
I accordingly
remit the case to the tribunal with the direction that they find that the
applicant is a person to whom section 21 applies and with the further direction
that they do now proceed to consider the question whether in all the circumstances
it would be fair and reasonable for the applicant to be able to apply under
section 20 of the Act for a direction entitling her to a tenancy of the
holding.
Judgment was
given in favour of the applicant with costs.
