Agricultural Holdings Act 1948, section 2 — Appeal from a decision of Comyn J — Question as to whether arrangements
This was an
appeal from the decision of Comyn J, reported at (1982) 263 EG 438, [1982] 2
EGLR 1, by the plaintiffs, South West Water Authority, successors in title to
Plymouth Corporation, and owners of 3,895 acres of agricultural land at
Walkhampton Common in Devon. Comyn J rejected the appellants’ claim to
possession of the land from the defendants (present respondents), Ernest
Frederick Palmer and Betty Eve Palmer. The appellants had claimed that the
respondents occupied the land on the basis of a 364-day tenancy or licence
which had been duly determined. There was a counterclaim by the respondents
which was based on the contention that they had a fully protected agricultural
tenancy, a contention which the judge upheld. The same contention was put
forward in the respondents’ cross-appeal.
Derek Wood QC
and Seddon Cripps (instructed by Q L Gray, South West Water Authority) appeared
on behalf of the appellants; the respondents appeared in person.
Giving
judgment, OLIVER LJ said: This is the plaintiffs’ appeal from an order made by
Comyn J in the Queen’s Bench Division on February 12 1982 dismissing the
plaintiffs’ claims for possession of some agricultural land at Walkhampton
Common in Devon, which I understand is part of the Dartmoor National Park,
consisting of 3,895 acres, and granting the defendants on their counterclaim a
declaration that the defendants held the land as protected tenants under the
Agricultural Holdings Act 1948. There were additional claims in the
counterclaim for damages and an injunction based upon the permissions given by
the plaintiffs for members of the public to enter upon the land and also for
permissions given in relation to manoeuvres carried out by the armed forces,
but those the learned judge dismissed.
This is, on
any analysis at all, a very sad case. There is no doubt whatever that the
defendants in the action, the respondents to this appeal, who succeeded down
below have over many years had a most friendly association with the
predecessors in title of the plaintiffs, the Plymouth Corporation, and there is
no doubt whatever that they have done a great deal on the land in the way of
removing dead animals and that sort of thing and seeing that everything is
conducted in an orderly way and in operating what has obviously been a pretty
successful hill farm, a venture for which they got grants under the Hill
Farming Act.
Where the
parties seem to have fallen out, as they have immediately prior to the issue of
these proceedings, is over the question of the extent to which the general
public and the military should be admitted to the land forming part of the
Dartmoor National Park and over who shall ultimately have the control over that
admission. I very much hope — and I am sure that my lords will agree with this
— that the atmosphere has not been so irretrievably poisoned by these
proceedings and the subsequent appeal as to lead to a permanent severance of
relationships between the parties, and Mr Wood has given the court the
assurance on behalf of his clients that there is, contrary to what the
respondents evidently feel, no policy whatever and no intention of adopting any
policy of driving the respondents off the land which they have successfully
grazed for so many years. I say that by way of introduction, because, although
it in fact has very little to do with the issues between them, one cannot help
observing that this is a case where the respondent has been there for a very
long time and where the continuance of his activities as a hill farmer is not
wholly dependent, but is to a very large degree dependent, upon his continuance
as a grazier on the land which is the subject-matter of this action.
The history of
the matter is this. For very many years past the land concerned, which until
the date fixed by the Water Act 1973 (which I think was April 1 1974) was
vested in the Plymouth Corporation, but has now become vested in the
plaintiffs, the South West Water Authority, has been used for grazing, and the
defendants in the action, the respondents on this appeal, have been among those
using it first as sub-licensees of part of the land concerned — I think about
1,400 acres — from a partnership which somewhat confusingly bore the same name
as the defendants but which in fact was not connected with them, A Palmer &
Sons, and latterly as direct licensees or, as the learned judge found, tenants
of the plaintiffs.
The
defendants’ connection with the moor goes back to the early 1930s in fact, but
for relevant purposes we can start the history in June 1967 when the Plymouth
Corporation entered into a grazing licence with the partnership to which I have
referred, A Palmer & Sons, under which the licensees were permitted to
graze for 364 days from March 24 1967 at a rent of £500. That document entitled
the licensees to permit three other named persons, which included the first
respondent, Mr E F Palmer — he is in fact known as Ted Palmer and is sometimes
referred to in the documents as T Palmer — to graze a certain number of ewes.
In his case I think it was 200. The grazing licence of 1967 was successively
renewed for further consecutive periods of 364 days from March 23 1968, March
22 1969, March 21 1970 and March 20 1971. Then in August 1971 there was a
change. By that time one of the partners in A Palmer & Sons had died and
the partnership, as I understand it, terminated and discussions took place with
a view to exploring the possibility of granting the grazing rights for the
whole area to the first respondent, Mr Ted Palmer. Those discussions resulted
in an offer which was made on September 24 1971. It was a letter from the City
of Plymouth which referred to the 3,895 acres at Walkhampton Common and reads
as follows:
Further to
your telephone conversation with my assistant, Mr Stivey, I write to confirm
that it has been decided to offer you the 364-day grazing licence of the above
land as from March 19 1972, when the present licensees’ term expires. In the
meantime, however, I shall be grateful if you will prepare a list of suitable
sub-graziers whom you may wish to be named in the formal agreement.
That offer was
accepted four days later in a letter which Mr Palmer wrote saying:
I accept your
offer of the grazing licence of the above land as from March 19 1972. The rent
as we agreed in previous correspondence at £600 per annum.
Then there is
reference to the proposed sub-licensees, and he terminates: ‘I will be grateful
if the agreement can be put in the names of E F Palmer & Sons.’
Then on March
9 1972 formal terms were proposed, and they were proposed in the form of a
letter from the city, which is in these terms, so far as is material — I do not
intend to read the whole of it —
With
reference to our previous correspondence and your telephone conversations with
my assistant, Mr Stivey, I write to offer you the 364-days grazing licence of
the above land. The licence is subject to the following terms and conditions:–
(1) The land is to be let on a 364-day grazing licence as from March 19 1972.
(2) The rent of £600 per period exclusive of all rates and other outgoings will
be payable quarterly in advance. The first payment of £150 shall be paid prior
to the commencement of the licence.
Then there is
a provision about assignment and underletting, which is in fact carried through
into the formal agreement, as we shall see later.
(4) The land shall not be used for any other
purpose than grazing cattle, sheep and ponies.
Then there are
a number of other terms which I do not think I need bother about. No 13
describes the extent of the land and 14 is in these terms:
The licence
will be the subject of a formal agreement to be prepared by the Town Clerk, and
which shall contain such other terms and conditions as he shall consider
necessary, the cost of such agreement to be borne by the grazier.
That was
accepted in a letter from Mr Palmer in which he said: ‘I agree to the terms as
set out by you. The sub-graziers I propose to graze on the western side of this
land are’ — and then he names them. At the same time he signed a duplicate of
the letter I have referred to on March 18 1972: ‘I hereby agree to the terms
and conditions as set out overleaf.’
So there as a
contractual matter, subject to the formal agreement, matters were concluded.
Rent payments were duly made. The first rent payment appears to have been paid,
as had been suggested, in advance of £150, and the first invoice for rent was
for the sum of £11.54 to cover the period from March 19 1972 to the 24th, that
is a quarter day, because it emerges from the rent receipts that we have seen
that, although it did not actually specify that the rent was to be paid on the
usual quarter days, the quarterly rent in advance was in fact paid on the usual
quarter days. An oddity arises here, because the bundle also contains the last
invoice for the year 1972 for the rent due on December 25 1972, which would
cover the period up to the end of the 364 days, and there there is a demand,
which as far as one knows was paid, for £150 without there being any credit
given for the odd £11.54 which had been charged at the other end of the agreement.
But I do not think anything turns on that, although it seems to have been a
factor which the learned judge took into account.
Then a formal
agreement was prepared and was entered into on April 24 1972. It is an
agreement between the Lord Mayor, Aldermen and Citizens of the City of Plymouth
and Mr Palmer and his wife trading as E F Palmer & Sons, and it is agreed
as follows:
(1) The Corporation let and the Graziers take ALL
THAT the right of grazing with cattle sheep and ponies over that portion of
Walkhampton Common shown edged red on the plan hereto annexed situate in the
Parish of Walkhampton and containing by admeasurement
and then it
sets out the dimensions
FROM the
Nineteenth day of March One thousand nine hundred and seventy two for a period
of Three hundred and sixty four days determinable nevertheless as hereinafter
provided PAYING THEREFOR rent at the rate of Six hundred pounds for the period
payable quarterly in advance and so in proportion for any period less than one
quarter.
Then there are
reservations to the corporation of the right to fence off areas for
afforestation or cultivation or grass land or other purposes up to a maximum of
300 acres and a reservation of game and wild fowl and the right of sporting,
hunting, coursing, fishing and shooting and so on; covenants by the graziers to
pay the rent, rates and taxes, not to cut peat and turf, and so on. There is a
provision under which the graziers are entitled to permit certain named persons
to sub-graze on the land, and there is not, I think, anything else in that
agreement that I need read. There is an arbitration clause at the end. There is
also a proviso for determination.
The only other
clause, I think, to which I need refer, because it may have some significance,
is clause 3(vii), which is a simple covenant against assignment.
Not at any
time during the tenancy hereby granted to assign underlet or otherwise part
with the possession of the said land or any part thereof nor to allow any other
person or persons to graze or otherwise use the said land and not themselves to
graze on the said land the animals of any other person (other than as provided
in Clause 4 of this Agreement)
clause 4 being
the clause to which I have referred enabling the named persons to sub-graze.
So there is the
formal agreement, and it is from here that the real dispute between the parties
comes to the fore. Before completing the history of the matter, it may, I
think, be convenient to digress for a few moments and to consider as a matter
of law what, apart from any evidence — and the trial turns primarily on the
question of evidence — is the effect of this document. One starts with section
2 of the Agricultural Holdings Act 1948, subsection (1). That is in these
terms:
Subject to
the provisions of this section, where under an agreement made on or after the
first day of March, nineteen hundred and forty-eight, any land is let to a
person for use as agricultural land for an interest less than a tenancy from
year to year, or a person is granted a licence to occupy land for use as
agricultural land, and the circumstances are such that if his interest were a
tenancy from year to year he would in respect of that land be the tenant of an
agricultural holding, then, unless the letting or grant was approved by the
Minister before the agreement was entered into, the agreement shall take
effect, with the necessary modifications, as if it were an agreement for the
letting of the land for a tenancy from year to year.
So here is a
provision which starts by converting a term in agricultural land for less than
a year into a tenancy from year to year unless ministerial approval has been
obtained. But there is then this important proviso:
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 period of the year, or to
an agreement for the letting of land, or the granting of a licence to occupy
land, by a person whose interest in the land is less than a tenancy from year
to year and has not by virtue of this section taken effect as such a tenancy.
Stated
shortly, the effect of that section is that a licence to occupy or a tenancy
for less than a year will in certain circumstances be converted into a tenancy
from year to year. What those circumstances are in relation to a licence we may
have possibly to consider a little later in relation to the appellants’
alternative submission, but for present purposes I propose to assume that the
document to which I have referred and with which this appeal is concerned is
one which, apart from the proviso, would be converted into a yearly tenancy and
thus brought within the protection of the Act. On this footing therefore the
question is: Is it a tenancy or licence which falls within the proviso? It is clearly a tenancy or licence for
grazing purposes only. It does not purport to be anything more than a grant of grazing
rights over the land, and it does not, in terms at any rate, confer any right
of occupancy for any other purpose. But is it a tenancy or licence only for a
specified part of the year?
It is clear
from the case of Reid v Dawson [1955] 1 QB 214 that a tenancy or
licence for 364 days from a specified date is a tenancy for a specified period
of the year within the terms of the proviso. That is clear as a matter of
decision in that case.
But the
argument which was advanced by the respondents in the present case and which
found favour with the learned judge was that as a result of a conversation
which took place at a somewhat indeterminate time, but probably before the
terms of the heads of agreement had been agreed, to which I have referred, and
between the respondent and the then town clerk of Plymouth, a Mr Haydon, the
grant was a grant in contemplation of a yearly tenancy of the land.
I will
consider the evidence as to this and the learned judge’s deductions from that
evidence in a few moments, but I should, I think, first look at two further
authorities from which there may be deduced some important principles which
have to be borne in mind, first, as to the approach of the court in cases
where, as here, there have in fact been successive agreements for limited terms
without any interval of time between them, so that as a matter of fact the
enjoyment of the grazing rights has extended over a whole year or indeed over
several years; and, secondly, as to the circumstances which the court may
properly take into account in determining what is the contemplation of the
parties at the time when the relevant agreement was entered into.
It is quite
clear from Reid v Dawson that if what is originally contemplated
is a letting for the limited purpose for a specified period of the year only,
the mere fact that at the end of that specified period a further agreement is
made for a consecutive letting for a similar specified period does not take,
per se at any rate, the case out of the proviso. In Reid v Dawson
the tenant had simply held over after the termination of the specified period,
and it was found as a fact that she did so in the knowledge that all that she
could obtain was a further period of 364 days.
The subsequent
case of Scene Estate Ltd v Amos looks at first a rather stronger
case from the tenant’s point of view on the facts. There there was a letting
for grazing purposes only for three months, which was subsequently extended by
a series of letters for successive periods of three months. It was found as a fact
that the original agreement was a genuine document, but that both parties
considered it probable, although not certain, that the agreement would be
extended from time to time, although there was no actual stipulation about it.
In fact the tenant enjoyed the grazing rights there for some five years. It was
nevertheless held that the agreement and the successive extensions were
lettings to which the proviso applied.
There are
three passages in the judgments to which I think I ought to refer. The case is
reported in [1957] 2 QB 205 and at p 209 Lord Denning (Denning LJ as he then
was) said this at the top of p 209:
Just looking
at that agreement by itself, it is quite plain that it was expressly within the
proviso and leaves the owner free to regain his land at the end of the three
months. But now comes the difficulty: at the time when the agreement was made
both parties thought that, at the end of the three months, it would be renewed,
and that there would be a renewal every three months.
Then at p 210
he recites the findings of fact of the judge in the court below, which may in
fact be thought to be very similar in material respects to those of the present
case. What the judge in the court below found was this:
Col Butler
he is the
agent for the owners
whose
evidence was in some respects vague, but in all respects notably candid, told
me that he himself expected and assumed that the defendant would continue in
occupation of the land for more than three months, certainly one year, perhaps
two, because he thought that the land would not be required by the plaintiffs
for any other purpose for a year or more, but he said that this was only his
own assumption and that he never communicated it to the defendant. The
defendant himself conceded, in answer to his own counsel, that he did not
remember Col Butler saying anything to him about extensions, but he also no
doubt expected and assumed that he would be able to remain in possession of the
land for longer than three months for the same reason as that stated by Col Butler.
He did not suggest that there was ever any sort of agreement that his tenancy
would be renewed from time to time, and I feel quite sure that he can never
have had any hope of obtaining such an agreement from the plaintiffs.
Then Lord
Denning takes it up and goes on:
In other
words, each party had it at the back of his mind that the agreement would be
renewed from time to time every three months, but each kept it to himself and
did not actually make a stipulation about it. It was just an expectation.
Then at p 211
he says:
I do not
think that the word ‘contemplation’ in the proviso should be given the meaning
which Mr Megarry seeks to put upon it. In my opinion the object of the word
‘contemplation’ in the proviso is to protect a landlord who has not expressly
inserted a provision that it is for grazing only, or for mowing only, or that
it is for a specified part of a year; but, nevertheless, both parties know that
that is what is contemplated. Often a landlord may let a field to a man by word
of mouth, saying: ‘You can have the field this year the same as you had it last
year.’ Both sides mean it to be for
grazing only and mean it to be only for a few weeks of the spring, but they do
not say so expressly. In such circumstances, even though nothing is expressed
in the agreement, nevertheless the landlord can still take advantage of the
proviso. That seems to me to be the real object of introducing the
‘contemplation’ of the parties. It would also cover the case of a ‘sham’ agreement.
Suppose, for instance, the written agreement did not really represent the true
transaction. The parties might contemplate the use of the land for ploughing
up, but falsely describe it as for grazing; or they might contemplate a letting
for two years and falsely put in three months. A sham agreement of that kind
would not come within the proviso, because, despite the express words, the
parties intended a different state of affairs. It seems to me that those are
the two cases which the legislature had in mind: and I find it difficult to
visualize any other. Apart from those cases, the courts should be guided by the
terms of the agreement, express or implied, and by nothing else: for in the
ordinary way it is from those terms alone that the contemplation of the parties
can be gathered.
That is echoed
in perhaps even stronger terms by Parker LJ, and I should mention that Sellers
LJ agreed with both judgments. At p 212 Parker LJ says this:
The words are
not altogether easy to construe, but this at any rate, I think is clear: first,
that ‘specified period of the year’ is equivalent to ‘specified part of the
year’ — that, I think, is the effect of the decision of this court in Reid
v Dawson in 1955; secondly, that the ‘contemplation’ must be not only
that the use of the land shall be only for grazing or mowing but that the
period of use shall be only a period which is less than a year. It seems to me
that, as a matter of grammar and ordinary reading, the word ‘only’ must apply
not only to the use but to the period; and indeed, if it were not so, it seems
to me that the words ‘some specified period of the year’ were quite
unnecessary, because this is a proviso to a section which is only dealing with
tenancies which are for part of a year. Thirdly,
and this is
the important point for present purposes
it seems to me
that the ‘contemplation’ must be mutual, both on the part of the landlord and
of the tenant. Fourthly, that one judges the contemplation as at the beginning
of the agreement, if there is but one agreement, or, if (as here) there is a
succession of agreements, then at the beginning of each agreement; because
unless the landlord satisfies the court that the required ‘contemplation’
exists in respect of each, then from the time of the agreement in respect of which
he fails to show the necessary contemplation the provisions of the Act will
apply.
Lastly, it
seems to me clear, by reason of the words in brackets
‘whether or
not the agreement expressly so provides’
that it is
permissible, in certain cases at any rate, to go outside the agreement and see
what the ‘contemplation’ was from extrinsic evidence.
Then he deals
with the question of extrinsic evidence, and he says:
Prima facie
it seems to me that an agreement is not made in contemplation of something
being done under it unless there is power and obligation to do that very thing.
There is no power in the tenant to stay for more than three months and no
obligation in the landlord to allow him to do so. Beyond three months the
matter is purely a matter of expectation. But if that is so, what (it is said)
is the effect of the words in brackets, ‘whether or not the agreement expressly
so provides’? In my judgment, those
words do not require a different construction. They are apt, and perfectly apt,
to enable one to look outside the agreement or the licence in order to
ascertain the terms where the agreement is silent on it. If the agreement is
express on the subject, then I do not think that one is entitled to look beyond
it unless it is for the purpose of showing that the agreement is a complete
sham. In other words, in the case of a genuine agreement which expressly says
that the lease is for grazing or mowing only, and expressly says that the
period is a period of less than a year, there is no right, in my view, to look
beyond the agreement itself. For those reasons I would dismiss the appeal.
That is a very
strong authority in the appellants’ favour, because the agreement here is
perfectly clear, and the correspondence leading up to it is perfectly clear. If
there is no right to look beyond the agreement, then cadit quaestio, and
this authority establishes that the only right to look beyond the agreement is
for the purpose of establishing, if it can be established, that the agreement
is a complete sham. If of course the agreement in this case were found to be a
sham things might be very different, but the learned judge here expressly found
that it was not. Such a situation might, I suppose, arise if the true agreement
between the parties was that although the document was to be expressed as
covering only a limited period of the year, there was in fact a contract that
it would be renewed.
That is what
happened in Short Bros (Plant) Ltd v Edwards (1970) 249 ESTATES
GAZETTE 539, and that was a case where the following facts were found. First,
that at a meeting between the landlord and tenant before the agreement was
entered into this statement was made: that there would be a succession of
written agreements in respect of such use, each of which would be for a period
of six months only and that there was no reason why such an agreement should
not go on for several years. Secondly, there was a finding that the farmer
signed this form of agreement in reliance on the assurance given to him by Mr
Short, who was the landlord, at a previous meeting that he would be able to
occupy the land for several years.
In fact in
that case there were 28 successive periods covering 13 years, 23 of which only
were covered by formal agreements. These findings are summarised in the
judgment of Brandon LJ at p 541 as follows:
First, that
there was a collateral oral agreement made at the meeting between the farmer
and J G Short before the first written agreement dated December 1 1963 was
signed. Second, that the agreement of December 1 1963 was signed by the farmer
in reliance on that collateral agreement. Third, that the agreement of December
1 1963 was not a genuine agreement so far as the period for which grazing
rights were being granted, namely the period of six months, was concerned,
because the oral agreement between the parties was for a period of several
years.
The effect of
this is summarised, I think, most accurately in the judgment of Geoffrey Lane
LJ at p 542 where he says this:
In this case,
however, the effect of the judge’s finding seems to me to be as follows
(although it is not the way in which the judge himself expressed those
findings). Before the first of the forms of agreement here were signed on
December 1 1963 the owner agreed with the farmer that the farmer would
have a licence to graze, and would not be disturbed for which was in effect
three years certain and thereafter until the owner chose to tell them to go
upon reasonable notice or perhaps upon six months’ notice. This, despite the
fact that the written document said otherwise. Consequently, the document, as
the learned judge has found, was not a genuine record of the true agreement
between the parties. It was without doubt the owner’s intention that similar
forms of agreement should continue to be signed by the farmer ostensibly, but
not genuinely, limiting the licence period to six months.
Those are the
relevant authorities on this aspect of the case, and it seems to me that what
we have to look for here is whether there was some indication in the evidence
before the learned judge or in the surrounding circumstances which show either
that the agreement was a sham or that there was some collateral agreement
either at the time or subsequently which points compulsively to the conclusion
that the agreement does not mean exactly what it says, if indeed that latter
possibility is not the same as saying that the agreement is a sham, which I
rather think it is.
As I have
mentioned, this is a case where there has been a series of consecutive
agreements, but it is not, I think, suggested that the mere fact of the absence
of any intermission between one period and the next per se takes them
out of the proviso, although the learned judge does appear to have attached
some importance to this, as I read his judgment; though merely as a factor
which was consistent with the primary conclusion to which he had arrived on the
evidence. It is that conclusion which relates to the contemplation of the
original agreement with the respondents that the appellants challenge. I will
return to that agreement in a moment and consider the evidence which the
learned judge relied on.
The primary
ground of the appeal is quite simply this. The evidence, which is not in itself
challenged, could not reasonably constitute the foundation for the learned
judge’s finding. But before I do that, we had better just complete the history.
I broke off and digressed on the legal position at the point of the formal
agreement in 1972. The respondents grazed under that agreement and prior to its
determination in the year 1973 an offer for renewal was made. That was on March
13 1973, and it was pointed out that the licence was expiring on March 17. I
think actually that that date is probably wrong. I think it was probably March
18, but it does not matter. It was assumed that the respondents would wish to
renew, and a document was being prepared.
Then on March
14, which again was well before the expiry of the first period, there was a
formal endorsement prepared and signed by the respondents, which was in these
terms, that the respondents
accept the
offer of Plymouth Corporation for a renewal of the letting to us of the above
land for a further period of Three hundred and sixty four days from the
Eighteenth day of March One thousand nine hundred and seventy three and
otherwise on the same terms and conditions as are contained in the annexed
Agreement.
That is
attached to the formal agreement to which I have referred.
The same thing
occurred in 1974. An offer was made of a renewal on February 20. This time the
corporation wrote to the respondents saying:
You are no
doubt aware that your current 364-day grazing licence of the above land expires
on March 16 next. I shall, therefore, be glad if you will let me know as soon
as possible whether you wish to continue for a further 364-day period, on the
same terms and conditions.
That was
accepted by the respondents on February 25 1974 in a letter in which they said:
We wish to
continue to occupy this land on the same terms and conditions as before.
Then on April
1 1974 the land became vested in the present appellants, although the Plymouth
Corporation thereafter continued to act as their agents. On March 24 1975 a
letter was addressed to the respondents from the appellants which lit the fuse,
I suppose one might say, which led to these proceedings, and that was in these
terms:
As you may
know, the authority has taken over lands previously administered by the old
water undertakings and river authorities and it will be dealing with all
grazing licences from now on. To this end, it is necessary for the authority to
evolve an overall policy for all lands within its control in the South West and
it cannot be guaranteed that all current licences will be renewed
automatically. I want you to know this to avoid any problems with stocking when
your licence falls in. In particular the authority do not intend to permit
their occupiers to sublet under the terms of future licences. I will be in
touch with you again.
On May 15 they
wrote a letter in which they referred to their earlier letter in March, and the
writer said:
I refer to
the above licence which expired on March 14 1975, and to offer you a further
grazing licence expiring on March 12 1976 at a rent to be agreed. I note the
rent of £600 was last reviewed in 1972. Would you please advise me if you wish
to renew the licence and be good enough to suggest a convenient date on which
we could discuss the rental.
The response
to that was a letter from some solicitors, who were then instructed by the
respondents. I need not read the whole of the letter. There was one paragraph
in it which is the only one material for the present purposes, and it was in
these terms:
We have
advised our clients that they are agricultural tenants of the land in question
as the letting does not come within the proviso to section 2(1) of the
Agricultural Holdings Act 1948.
It is perhaps
not altogether surprising that, if and so far as the South West Water Authority
maintains dovecots, that letter created a certain amount of fluttering in them.
Discussions
ensued, and, accommodation proving impossible — and I infer from everything
that appears from the transcripts, and from what has gone on in this court that
the real stumbling block here was the question of public rights of access and
access to the army — for whatever reason, this action was commenced by the
plaintiffs (the present appellants) on October 13 1978. The statement of claim
was endorsed on the writ and simply claimed possession of the land. I do not
think it is necessary to refer in any detail to the pleadings, because happily,
although formal grounds of objection are taken in the notice of appeal to the
learned judge having granted, as he did, leave to amend, it has not been
pursued by Mr Wood in this court. But I think it is worth looking at the terms
of the counterclaim to see the way in which the matter was originally expressed
and the way in which it was expressed until this case had in fact come to trial
before the learned judge.
I will have to
come to the counterclaim itself later, because it deals in fact with the
damages which are claimed for breach of an implied covenant for quiet
enjoyment, but that is something which I can deal with very much later in this
judgment.
The claim was
one which was dismissed by the judge and for which the present respondents
cross-appeal. For present purposes the important matter is paragraph 3 of the
defence, which is in these terms and which sets out the respondents’ then case:
The
Defendant’s admit that there was a document dated April 24 1972 and a
subsequent document dated April 4 1973 but make no other admissions as to
Paragraphs 2, 3, 4 and 5 of the Statement of Claim. The Defendants aver that
the said documents were not consistent with a letting for grazing or mowing and
were consistent only with a letting to which the Agricultural Holdings Act 1948
applies.
Particulars
were sought and given of that averment, and they read as follows. The
particulars requested were: ‘Of ‘were not consistent with a letting for grazing
or mowing”, and the answer is: ‘It is the nature of the Defendants’ case that
the document dated April 24 1972 placed responsibilities upon the Tenants that
were more onerous than would be imposed upon a grazier.’ The second request under this paragraph was:
‘Of ‘were consistent only with a letting to which the Agricultural Holdings Act
1948 applies”, and the answer was: ‘It is the nature of the Defendants’ case
that the Defendants were protected agricultural tenants. The document dated
April 24 1972 placed responsibilities upon the tenants which by their nature
were consistent only with a protected agricultural tenancy.’
One sees
therefore that issue was there being joined solely on the contents of the
agreement, it being suggested that certain obligations contained in the agreement
were inconsistent with an agreement which fell within the proviso. That was not
a case which appears to have been pursued at the trial, although it was the
issue when the matter came on for hearing. What happened was that when the
first respondent, who appeared in person, came to give his evidence he did so
very sensibly by handing in a proof of evidence which he then verified on oath.
In that proof
he said this:
The only
thing wrong with this agreement is the 364-day tenancy clause. I took this up
with the town clerk and he said, don’t worry about that and I also contacted
the Ministry of Agriculture and was told ‘that cannot be operated without our
consent.’ This agreement started on
March 19 1972 and Plymouth Corporation agreed that this agreement should
continue without a break and they made sure this was the case by overlapping
and stating it could run on from March 18 1973. And again they said the same
agreement could continue from March 18 1973.
He was
cross-examined upon that, and I must, I think, refer to a few of the answers
which were given in cross-examination, because it was really upon that passage
in his evidence as supplemented by his cross-examination and the evidence which
I shall come to a little later of Mr Haydon that the learned judge decided the
case in the respondents’ favour and came to the conclusion that although the
agreement was not a sham it was nevertheless an agreement which, quite contrary
to the express terms, was an agreement for a protected tenancy for a year or more.
In his
cross-examination Mr Cripps, who was appearing for the appellants below, said
to him: ‘You say there was something wrong with it so you took it up with the
town clerk?’ He is clearly there
referring to the statement I have just read. The answer was: ‘Yes. That was Mr
Haydon. Don’t try to get me confused, because I have been in this job . . .
That was Mr Haydon.’ Then he was asked:
‘And he said, ‘Don’t worry about that . . .’?
(A) That was my 1972 agreement, you mean, isn’t it? (Q) Yes. He told you not to worry about it,
did he? (A) Yes. He said, ‘Don’t
worry.’ He said, ‘You worry too
much.’ That was what he said.’ Then it was said that this conversation took
place on the visit to his house. The witness said that he had not taken the
agreement with him. He said: ‘I just said I didn’t like this — I wondered about
this 364-day thing. I remember his words, he said, ‘Don’t worry about that. You
worry too much’.’ Then he was asked:
‘What did you understand him to mean by that?
(A) I know this, that as long as Mr Norman Elliott and Mr Haydon, and a
few others of those good gentlemanly people of Plymouth were there, I was not
going to be let into any trouble at all’, and then he goes on to say that they
appreciated all his work over the last few years, that there have never been
any complaints, and so on, and that indeed is not in issue.
Then a little
later he is asked by the learned judge this:
Whether you
are right, or whether you are wrong, what you are saying is this; it is obvious
that if they gave you an agricultural tenancy there would be difficulties, so
what they did then was to adopt this 364-days device, and the town clerk, Mr
Haydon, told you not to worry about it?
(A) That’s right. He said, ‘You worry too much; don’t you worry.’ And the Ministry said, ‘They can’t operate
that without us.’
I mention that
question from the learned judge for this reason, that it discloses an approach
to this problem which emerges clearly in the learned judge’s judgment and
which, for reasons which I shall endeavour to explain a little later, seems to
me to be fundamentally wrong, and that is the concept of the grant of a limited
grazing right as a ‘device’.
But I can go
on with the cross-examination now. There are, I think, only three other
questions I need refer to. Mr Cripps asked the first respondent: ‘So really my
Lord is concerned solely with this conversation with Mr Haydon dealing with
this 364-days thing? (A) It is just a
question that when I pointed out to him that it wasn’t a yearly tenancy, he said,
‘Don’t worry; you worry too much’.’ He
is asked again: ‘Do you agree that when you got this written document you were
sufficiently concerned — this must be your case — on reading it to see that it
was wrong and it did not give you what you wanted? That is your case. (A) I wasn’t sufficiently
happy about it, but I was told not to worry. I think they probably knew what
they were doing.’ A little later he was
asked: ‘And you understood that to mean Mr Haydon was telling you, ‘Don’t worry
what it says, you are a protected tenant.’
Is that right? (A) I’ll tell you
what I . . .’ He never completed that
answer and he was pressed again: ‘Is that right? (A) Yes. They would see that I wasn’t moved,
that’s about the truth of it. That’s the words of mouth. If it was in simple
language, ‘We’ll see that you’re not shifted.’
And that is exactly what they did do.’
Then the learned judge observes, ‘That is the case he is putting forward,
right or wrong, is it not, Mr Cripps, of saying, ‘If you sign that agreement,
do not worry clause I will not apply.”
I can press on
very much later in the cross-examination where Mr Cripps returns to the attack.
The witness was being asked about the letter of September 21 1971 in which he
was offered a grazing licence. He is asked this: ‘When you get this letter,
then, it is clear, is it not, that what you are being offered is the 364-day
grazing licence? (A) Yes. (Q) And you
realised that was not what you — it was a short let, and would not give you
protection, did you? (A) I wasn’t quite
happy about it. (Q) So what did you do when you got that letter? (A) I spoke to Mr Haydon. (Q) Is that the
conversation when you are told, ‘Do not worry about it’? (A) Yes.’
He finally admitted those were the words. ‘(Q) Do not worry about that,
but . . .? (A) That is it, yes. (Q) In
September? (A) Yes, or it was there . .
. Yes, I would say it was. It was along there, somewhere along there. Yes.’ Then he is pressed: ‘If you cannot remember,
say. (A) Well, no, I don’t remember exactly when that took place, but I know
that was the conversation. It was one of those little things I do remember,
‘Don’t worry.’ The part I remember —
‘You worry too much.”
All that was
really pretty inconclusive, but in fact the plaintiffs then by way of rebuttal
called Mr Haydon, interrupting, as I understand it, the defendants’ case for
that purpose. I must briefly refer to the transcript of his evidence, because,
as will be seen, the learned judge drew certain inferences from it about what
Mr Haydon contemplated. First of all, Mr Haydon could not remember the incident
to which the respondent referred. The background was explained and he was
asked: ‘Can you remember any such incident?
(A) No. I can remember Mr Palmer having been to my house on perhaps two
occasions delivering horse manure which he was kind enough to let me have for
my garden. I don’t remember any conversation of this sort.’ Then he is asked: ‘Mr Haydon, if Mr Palmer
had come along to you and said, ‘I am worried about 364 days’, is it likely that
you would have said to him, ‘Don’t worry about that’? (A) I heard that phrase yesterday, my lord,
and I thought, ‘This is the kind of thing that I might well say to Mr Palmer,
not only on this occasion, but on other occasions when he telephoned me in the
past.’ I have to be honest in that
respect, but I don’t remember anything of this sort happening. Indeed I have
heard that something of this sort was said by Mr Palmer, and I thought in my
own mind that he had telephoned me at some time, but I don’t remember him
coming to my house . . .’ Then he is
asked whether it was on the telephone that he might very well have said those
words and his answer was: ‘What was said yesterday sounded like me, when my
lord, I think it was, said ‘Don’t . . .’
I forget the exact phrase, but I thought, well, you know, I might have
said that, ‘Don’t worry’ — it wasn’t quite this, but — ‘it may never happen’,
sort of business. That was the kind of thing. (Q) Yes. What . . . (A) ‘It may
never happen’. But if it is suggested that I committed from the City’ — I think
the word ‘from’ must be wrong there — ‘committed the City to the proposition
that the 364-day tenancy did not mean what it says in writing, this is
something I would have remembered I feel sure. (Q) If it is suggested that
whatever you said was you telling him not to worry about the words, he would
stay there for as long as he wanted, or something along those lines — not the
words, but the effect of it was — what would your reaction be to that? (A) Quite obviously I should be doing an
extreme disservice to Mr Palmer and to my employers. I should think that I had
been long enough in the law not to do anything like that.’ Then he was asked: ‘What was the policy in
the department? (A) The policy was to
retain control of the catchment area, because, after all, we might need land in
that area for all sorts of purposes.’
Then he was
cross-examined by the first respondent a good deal later. He was asked this:
‘Now you have said what I told them yesterday were the words, ‘Don’t worry, you
worry too much’? (A) That is the kind of
thing I might have said to you about the Skellys or all sorts of different
matters, but I wasn’t saying that there is no cause to worry. It was rather
that it could happen but, you know . . . (Q) As far as you were concerned you
hoped it would not? (A) That is right. I
hoped it wouldn’t happen. (Q) That is right. You hoped it would not
happen? (A) Yes. I knew also that there
was nothing else but a grazing tenancy on offer to you and others like you at
that time. (Q) You cannot offer much else, because it’ — and then there was
something inaudible — ‘(A) I mean a 364-day tenancy — that was our practice.
(Q) You hoped that we would not be put out at any time? (A) Certainly. (Q) So what happened
then? Can you remember? (A) You signed the document. I can’t
remember, but I am reading through the file. You signed the document and then
renewed it a couple of times, until the water board took over and the chief of
administration wrote you a letter which made you very frightened, I would
guess.’
On the basis
of that evidence the learned judge gave the respondents leave to amend their
pleading. In fact after judgment he drafted the amendment for them so that
paragraph 3(a) of the defence now came to read:
Further and
alternatively in about March 1972 the Defendant visited the then town clerk, Mr
Haydon, complaining that the agreement offered was a 364-day unprotected
tenancy or licence without protection and that he wished for or needed
protection and that the said Haydon said ‘Don’t worry about that’ and was
thereby offering a yearly tenancy which he accepted.
It was on that
basis that the learned judge decided the case in the respondents’ favour. He
found as a fact that the conversation referred to between the first respondent
and Mr Haydon did take place prior to the execution of the agreement. He found
that the joint contemplation of both parties was that what was to be granted
was a protected tenancy, and he held, perhaps a little surprisingly, that, although
the agreement was not a sham, nevertheless it was an agreement which contrary
to its terms took effect as a protected tenancy from year to year, and in doing
so he based himself almost entirely on this conversation with Mr Haydon. He
also had regard to the provisions for payment of rent in advance quarterly,
which he regarded as either only consistent with or as more consistent with a
yearly tenancy, and on the succession of agreements without any intermission
between the end of one and the beginning of the next. So the first point on
this appeal — and it is one which at the end of it all is really a fairly short
one, which, I think, is not susceptible of any great elaboration — is whether
there was in fact on the evidence to which I have referred, which I think is
all the relevant evidence that the learned judge had on the matter, there was
any evidence to support the learned judge’s conclusion.
The first
criticism that the appellants level at the learned judge’s judgment arises out
of two passages at pages 3 and 4 of the transcript of the judgment, and this is
harking back to a matter which I mentioned a little earlier when I was
referring to the learned judge’s statement in the course of the evidence. At p
3 the learned judge says this:
The matter of
a 364-day tenancy arises under the proviso to section 2 of the Agricultural
Holdings Act 1948 and is a device designed to defeat a tenant getting a
protected agricultural tenancy.
On the
following page he repeats that in a slightly different sense:
With the
coming into force of the 1948 Act a device grew up intended to get round
secured tenancies, and that was a letting or licence for grazing or mowing for
364 days.
The appellants
submit that this reflects a fundamental misconception which coloured the learned
judge’s whole approach to the problem before him. For my part, I think that
this criticism is well-founded. The grant of grazing rights for a limited
period is not, in my judgment, a ‘device’ to avoid the protection of the Act.
It is a transaction which the Act itself designates as one which does not
create an agricultural tenancy which is protected under the Act, and presumably
that is because without such a proviso there would be a widespread reluctance
to let areas of good grazing land. Nor, in my judgment, does the categorisation
of the transaction as a device constitute merely a misdescription. To my mind
the error is more fundamental than that, because it involves what appears to me
to be a wholly wrong starting point for the inquiry on which in any given case
the court is required to embark. It assumes that the transaction which the
parties have in mind is a transaction other than that which it appears to be
and that it takes the form that it does take in order to avoid what would
otherwise be the consequences of the true transaction. Thus to start from this
point really colours the whole of the subsequent approach. I stress this
because it does seem to me that this view of the matter very much affected the
learned judge’s approach to the very tenuous evidence adduced to show that the
transaction effected by the agreement with the respondents in 1972 was not in
fact what it purported to be on its face and which led him to look in the
agreement for indicia which would support or at least be consistent with
the assumption that the agreement was no more than a device to conceal an
intended tenancy from the owner of the land. He was thus led to what is in the
light of the history of the land since 1967 a rather startling conclusion, for
it involves the consequence that, although it is not merely conceded but
asserted by the respondents that the public have had access to the land for
recreational purposes for years with the permission of the land owner (his
primary complaint being not the incursions of the public, but the increase in
the volume of such incursion) very nearly 4,000 acres of land forming part of
the Dartmoor National Park is removed from the control of the land owner and
placed under the control of a private farming partnership, and the public
access to it is as a matter of law to be at the whim of the partners for the
time being.
Of course if
that is the consequence as a matter of law of what the parties have done, so be
it. It is not for the court to judge the desirability of the consequences, and
there are frequently occasions when a judge is compelled to say fiat
justitia, ruat coelum. But it is at least not a consequence at which the
court should be eager to arrive in the absence of strong evidence which
compulsively leads to that conclusion. Here the evidence at the highest
consisted of a statement which depended on the evidence of the respondent — for
Mr Haydon can say no more than that it was the sort of thing he might well have
said — on an occasion which he could not precisely identify and which consisted
simply of the words, ‘Don’t worry. You worry too much.’
I turn now to
the learned judge’s judgment where he deals with this matter. What the learned
judge said was this:
I am
abundantly satisfied that what the male defendant says happened did happen: he
was worried about the tenancy being for only 364 days and thus not protected,
he made a special journey to the town clerk’s house and told him about that
worry, whereupon Mr Haydon replied, ‘Don’t worry’ or ‘Don’t worry about that.
You worry too much.’
That is the
finding of fact, and of course the appellants do not quarrel with that.
He goes on to
explain that Mr Haydon could not remember the occasion, but that he was
prepared to accept what the male defendant said about it. I am not sure that
that is in fact not putting it too high, because what Mr Haydon was prepared to
accept was that it was the sort of thing that he might well have said.
The learned judge goes on:
Neither the
male defendant nor Mr Haydon are able to say just when this meeting took place,
but, in my judgment, everything points to it having been before the formal
agreement was signed and very probably before the heads of agreement were
signed.
Then a little
later, having found those facts, he goes on to consider the legal effect of the
facts which he has found. He says:
It was a
serious matter and occasion, and I cannot treat it as being meaningless, as the
plaintiffs suggest. I consider that the conversation was contractual and
conferred a yearly protected tenancy on the defendants. What else can the words
‘Don’t worry’ or ‘Don’t worry about that’ mean?
I can think of no other meaning. The town clerk was giving the male
defendant formal reassurance not to worry about what was worrying him, namely
only having a 364-day tenancy. I believe that both contemplated as a result of
the conversation a protected yearly tenancy. In my judgment, the conversation
cannot have been in contemplation of anything else. Mere reassurance would have
been meaningless.
Then he goes
on to deal with what he describes as the curiosities of the agreement:
The
curiosities about the agreement which I mentioned earlier seem to me
inconsistent with anything else but a yearly tenancy. Firstly, the rent was
payable quarterly in advance and it was demanded and paid on the usual quarter
days, of which there are of course four in a year.
Then he deals
with the various rent receipts and concludes:
One therefore
finds for the year 1972 to 1973 complete quarterly demands and receipts, so
that the tenants have paid not only for a complete year, but also for some
extra days, because, it will be remembered, the first receipt relates to 19 3
1972 to 24 6 1972. That then is the first curiosity which seems to me
inconsistent with anything else but a yearly tenancy.
Secondly,
when the agreement was renewed in 1973 there did not occur — nor had there ever
occurred in any of these so-called 364-day tenancies — any break in the
continuity of the holding. There was no turning off the land, actual or even
symbolic. There was no actual or symbolic taking of possession. The sheep and
the cattle grazed on on the 365th day as they had before.
I pause there
to comment that that appears to overlook entirely the two cases in this court
of Reid v Dawson and Scene Estate Ltd v Amos, because
it is attributing to the mere fact of continuity some sort of effect of taking
the tenancies out of the proviso or at least as a contra-indication that the
agreement means what it says.
Then the
learned judge continues:
Mr Cripps
sought to persuade me that to find as I have would be to regard the written
agreement to be ‘a sham’. I interpret ‘sham’ as being deliberate
misrepresentation. That I certainly do not find here. What I find is a
contractual representation and agreement by Mr Haydon, which was entirely bona
fide and converted the so-called 364-day tenancy into a protected yearly
tenancy. I also find in regard to rent and rates
and whether
that ‘rates’ is correct or not is, I think, problematical; it may have been
‘dates’
— two matters
I mentioned a moment ago —
that these
are consistent, in my judgment, only with a yearly tenancy.
Of course the
evaluation of the testimony of the witnesses was entirely a matter for the
learned judge, as the appellants accept and must accept. But that is not the issue
here, because no one is
took place in the terms and in the circumstances in which the respondent
claimed that it took place. But what the appellants say is that the learned judge’s
conclusion is simply not a permissible one from the evidence which he accepted.
He held specifically that the agreement was not a sham, so that the case was
not in the least analogous to Short Bros v Edwards, and he
ignored the approach directed by this court in Scene Estate v Amos
by looking outside the agreement. The agreement here was quite unequivocal, and
the highest that Mr Haydon’s statement could possibly be put, in my judgment,
was simply as an assurance of the probability that, all other matters being
equal, the agreement would be likely to be renewed as it had been in the past.
I think the learned judge was putting altogether too much force on the
extremely equivocal words ‘Don’t worry’ or ‘Don’t worry. You worry too much.’ Speaking for myself, I find the appellants’
submissions compelling, and I am, I regret to say, unable to reach the same
conclusion as the learned judge. I simply do not find it possible to attribute
to Mr Haydon’s statement the force of the contractual assurance which the
learned judge found of security of tenure. It seems to me to be wholly contrary
to the whole climate in which the parties had lived for the last 10 years or
so, wholly contrary to the policy which Mr Haydon knew perfectly well that the
council was adopting and not, looking at it purely objectively, a phrase
capable of carrying the import which the learned judge sought to attribute to
it. So, as I say, it seems to me that the conclusion is not only contrary to
what I might call the text of the statement found, but also contrary to the
whole spirit of the background in which the statement was made. I add this: I
cannot see any foundation at all, with respect to him, for the conclusion at
which the learned judge arrived, that it was within Mr Haydon’s contemplation
that the tenancy should be a protected tenancy.
That really, I
think, is sufficient to dispose of this case. The appellants have got an
alternative ground of appeal which was, as I understand it, argued before the
learned judge. It was not in fact dealt with in his judgment, and it would, if
good, in any event have been conclusive of the matter. They argued, first of
all, that as a matter of construction the formal document to which I have
referred is a grazing licence and not a grazing tenancy. It does not purport to
be a grant of the land, but merely a grant of the grazing rights. The argument,
which is based upon the two cases to which Mr Wood refers of Harrison-Broadley
v Smith [1964] 1 WLR 456 and Bahamas International Trust Co Ltd v
Threadgold [1974] 1 WLR 1514, is that since the document does not
purport to confer upon the respondent an exclusive occupation of the land,
because it quite clearly envisages the corporation being free to enter the land
— and indeed Mr Wood has sought to draw our attention to certain passages in
the evidence which indicate that the practice was for the public and the Army
to enter on the land under a permission from the local authority — even if you
take the case out of the proviso it still does not fall within the first part
of subsection (1) of section 2 of the Act for the reason that you cannot by
modification turn it into a contractual tenancy from year to year without in
fact making it into an entirely different agreement from that which it is,
namely an agreement which does confer exclusive possession upon the
respondents.
I state the
argument simply for the purpose of saying that it is unnecessary for us in the
event to deal with that, although it is, I think, a matter with which the learned
judge should have dealt in his judgment, because, if right, it would have
involved a quite contrary conclusion to that which he arrived. But in the light
of the view which I take of this appeal it does not appear to me to be
necessary to deal with that point, and I say nothing about its validity or
about the evidence to which Mr Wood has referred us, which I am bound to say I
think to be of a somewhat tenuous nature.
There remains
then the question of the respondents’ cross-appeal, which of course must rest,
if it is to rest on anything at all, upon the correctness of the learned
judge’s judgment finding that he is a tenant of the land. There is a case which
no doubt could have been pleaded by the respondent as a licensee that there was
an implied term that his grazing rights should not be interfered with and that
he would be entitled to damages for an interference with that right by the
granting of public licences. But that was not the case which was pleaded, and
it is not one into which we can go. The whole case was based upon a covenant
for quiet enjoyment in a protected tenancy, and if this appeal is to be
allowed, as I think it should be, the allowance of the appeal must also involve
the correctness of the learned judge’s rejection of those claims on the
counterclaim.
I think that I
have said all I need say. I only add this, that I sincerely hope that the
result of this appeal will not be that in the end the respondent will find
himself in a position where he is no longer able to carry on on the land. From
what Mr Wood has said, I see no reason whatever to suppose that that is a
necessary consequence. It certainly appears not to be an intended consequence.
I think it is a matter of very great regret — as indeed obviously the learned
judge thought, because he was clearly very distressed about the inability of
these parties to come to any accommodation — I think it is a matter of very
great regret that it was not possible to settle this case, and I only hope that
efforts will not be discontinued to try to arrive at accommodation between the
parties.
Having said
that, I say no more. The appeal must, in my view, be allowed, and we will hear
no doubt, if my brethren agree with the view that I have taken, submissions
about what the appropriate order will be.
Agreeing, KERR
LJ said: Having regard to the assertion by Mr and Mrs Palmer in their
counterclaim that they are entitled to a tenancy of the land which is protected
by section 2(1) of the Agricultural Holdings Act 1948, the plaintiffs
ultimately had no alternative but to bring these proceedings, and in form, but
I trust only in form, their claim is inevitably one for possession of the land,
together with the usual ancillary claims for mesne profits and so forth. There
is, however, I am glad — though not surprised — to hear no intention on the
part of the plaintiffs to act on that relief, which this court is nevertheless
bound to grant in allowing this appeal. After all, the plaintiffs and their
predecessors over some 50 years have known that the Palmers acquired a freehold
of some 26 acres, and built up their hill farming business, in reliance on
their grazing rights during this time. The real dispute which has caused these
proceedings to be brought does not relate to the Palmers having these grazing
rights, but to the extent to which it is open to the plaintiffs to allow access
on this land to the public and to the armed forces, and, as regards the
Palmers, to the extent to which they are entitled to control such access.
So the real
issue is whether or not the Palmers are entitled to the declaration which they
have counterclaimed. This raises a relatively short question of law. The right
of Mr and Mrs Palmer in relation to this land depends, in the first place, on
the agreement made on April 24 1972 and to its renewal from time to time. In
each case this was for 364 days from a specified date at a rent of £600 for the
period, payable quarterly in advance. These matters dispose of two ancillary
points to which Comyn J referred in his judgment, viz the terms on which the
rent was to be paid and the fact that the agreement was renewed on a number of
occasions. There is nothing in these points, because — and I think the judge
would probably have agreed — when one looks at this agreement and its renewals,
it is perfectly clear, in the light of the authorities to which Oliver LJ has
referred, that the agreement falls within the proviso to section 2(1) of the
1948 Act, being a licence to occupy land in contemplation of the use of the
land only for grazing during some specified period of the year.
That, as it
seems to me, is the end of this case, subject only to the event which caused
the judge to come to a different conclusion, the conversation between Mr Palmer
and Mr Haydon, which it is accepted took place in the way described by Mr
Palmer. Everything in the judgment ultimately hung on the six words which were
spoken by Mr Haydon when Mr Palmer was worried about the fact that this
agreement was only for 364 days: ‘Don’t worry. You worry too much.’ However, I cannot begin to see how those
words can have had any contractual effect on the written document which was
thereafter signed by Mr Palmer, and which was renewed and signed by him on
subsequent occasions. They seem to me to be wholly innocuous and conversational
in their nature. I regard them as a general reassurance to the effect that
there was no intention to turn him off the land, as is still the position
today. But in my view they are quite incapable of qualifying the written
documents, which plainly fall within the proviso.
Accordingly I
have no doubt, despite my sympathy for the respondents, that this appeal must
be allowed.
Also agreeing,
SLADE LJ said: I also agree that this appeal must be allowed. I have
considerable sympathy with Mr and Mrs Palmer and would heartily endorse my
Lords’ expressions of hope that the parties may be able to reach an agreed
settlement in this matter. But at the end of the day I think that the learned
judge’s judgment in
proper conclusion on the evidence is that the agreement of April 24 1972,
despite its form, was in truth made in contemplation of the use of the land for
a period exceeding a specified period of 364 days. On any other footing it is,
in my view, plain that the agreement falls fairly and squarely within the
proviso to section 2(1) of the Agricultural Holdings Act 1948, with the result
that the defendants cannot possibly have a tenancy protected by that Act.
On the face of
it the 1972 agreement was quite clearly made in contemplation of the use of the
land for 364 days and no more. On the evidence the only possible ground that
can be put forward, and has been put forward, for asserting that this did not
represent the true agreement between the parties is the conversation between Mr
Haydon and Mr Palmer on which the judge so heavily relied.
The learned
judge said in relation to the words in question, which were ‘Don’t worry about
that. You worry too much’,
I believe
that both contemplated as a result of the conversation a protected yearly
tenancy. In my judgment, the conversation cannot have been in contemplation of
anything else. Mere reassurance would have been meaningless.
With the
greatest respect to the learned judge, I am quite unable to agree with this
inference. It seems to me to read far too much into these eight brief words. I
cannot, for my own part, see why mere reassurance would have been meaningless.
The judge expressly found as a fact that by March 1972 Mr Palmer knew the
important difference between a 364-day tenancy and a yearly tenancy. But it
would appear to me fairly clear that Mr Palmer himself did not regard the words
uttered by Mr Haydon as constituting anything more than mere reassurance. His
own attitude is well-reflected in a passage in his cross-examination; one finds
him asked about this conversation, and his reply was this: ‘Well, I am sorry,
you call Mr Haydon. It is a little, silly, stupid thing, isn’t it — just two or
three words which I said Mr Haydon said. I don’t see it matters two hoots or
not.’ This reply is hardly consistent
with any belief on the part of Mr Palmer himself that the conversation was one
of crucial importance, which operated to confer on him legal rights quite apart
from the formal agreement. I believe that the proper inference is that Mr
Palmer himself believed, and reasonably believed, Mr Haydon’s words to have
been uttered merely by way of reassurance, without being intended to have legal
consequences.
My conclusion
is that there is no evidence on which the court can properly find that the
agreement was made in contemplation of use of the land for a period exceeding a
specified period of 364 days. It may well be that all parties to the agreement
contemplated that in all probability the defendants would in practice be given
another contract as soon as the original 364-day term expired. But the decision
in Scene Estate Ltd v Amos [1957] 2 QB 205 to which Oliver LJ has
referred, in my opinion shows clearly that such a contemplation would not by
itself suffice to take the case out of the proviso to section 2(1) of the 1948
Act, so as to enable the defendants to resist the present claim.
As to the
other issues which have been canvassed in this case, I have nothing to add to
what my lords have said, with all of which I agree. For those reasons and the
further reasons given by them, I would reluctantly allow the plaintiffs’ appeal
and dismiss the cross-appeal.
The appeal
was allowed and respondents’ cross-appeal dismissed. Possession was ordered in
28 days on an undertaking by appellants not to enforce order for six months. No
order was made for costs below or of the appeal, but costs of an order for
mesne profits were reserved to the district registry.
