Agricultural Holdings Act 1948 — Whether proviso to section 2(1) applied on the ground that there was an agreement ‘in contemplation of the use of the land only for grazing or mowing during some
This was an
appeal from a decision of Judge Best at Bridgwater County Court in an action
between John Neville Stone, plaintiff, and David Roy Whitcombe, defendant,
concerning a piece of land, of over 17 acres, at Catcott Moor in the Bridgwater
Plain. The plaintiff claimed that, as a result of section 2(1) of the
Agricultural Holdings Act 1948, he was entitled to a tenancy from year to year
of the land; the defendant, the owner of the land, submitted that the proviso
to section 2(1) applied and that accordingly the plaintiff had not acquired
such a tenancy. The judge decided in favour of the defendant and the plaintiff
appealed to the Court of Appeal.
James Wigmore
(instructed by Reed & Reed, agents for Ash, Clifford & Co, of
Bridgwater) appeared on behalf of the appellant; Hubert Dunn (instructed by
Gregory Rowcliffe & Co, agents for Pardoe, David & Shaw, of Bridgwater)
represented the respondent.
Giving the
first judgment at the invitation of Stephenson LJ, WALLER LJ said: This is an
appeal from a decision of Judge Best sitting in the Bridgwater County Court and
delivered on October 5 1978. It arises out of a dispute over 17 acres of land
at Catcott Moor in the Bridgwater Plain. The land was owned for many years by
Mr Burgoyne, but in 1976 he sold it to the defendant Mr Whitcombe. In April
1974 the plaintiff enquired from Mr Burgoyne whether he could have the land. Mr
Burgoyne said that he could either purchase it or rent it or have the grazing.
An agreement was reached and as a result the plaintiff was able to put his
stock on the land in the summer of 1974. The plaintiff paid £55 cash to Mr
Burgoyne on June 6, at a time when Mr Burgoyne was ill in bed. In 1975, in
circumstances to which I shall refer later, the arrangements made in 1974 were
renewed and the plaintiff put his cattle on the land. In March 1976 Mr Burgoyne
conveyed the land to the defendant and when the plaintiff put his cattle on the
land the defendant turned them off. There is a dispute between the plaintiff and
the defendant as to the terms on which the plaintiff had rights over the land.
The issue is, was it a tenancy as the plaintiff alleges, in which case by
section 2(1) of the Agricultural Holdings Act 1948 the tenancy would become a
tenancy from year to year; or was it merely the selling of grazing and mowing
as the defendant submits, in which case the proviso to section 2(1) of the
Agricultural Holdings Act may take this land out of the provisions of section
2(1)?
The learned
judge found for the defendant and the plaintiff appeals to this court on two
main grounds: firstly, that the judge was in error in finding the facts in the
way in which he did and should have preferred the plaintiff’s evidence and
found that there was a tenancy. Alternatively, if it is not possible to reverse
the judge’s findings of fact, the plaintiff submits that his conclusion that on
the evidence the agreement was in contemplation of the use of the land only for
a specified period of the year was wrong.
I deal first,
briefly, with the submissions relating to the finding of fact. The original
arrangements were made at a meeting in the 5-acre field, which is part of the
land in question. The plaintiff’s evidence was that he agreed to rent the land
and not buy it, and that he was not interested in the grass keep. Mr Burgoyne’s
evidence was that he sold the grass for 12 months and the following year sold
it again. The plaintiff’s evidence was supported to some extent by his sons,
who were present for part of the meeting at the 5-acre field, and also Mr
Burgoyne was later paid £55 in cash and he signed a receipt. The receipt was in
Mrs Stone’s, the plaintiff’s wife’s, writing, and it described it as a receipt
for rent. Mr Burgoyne had not read the terms of the receipt. He received the £55
in cash and signed the receipt without reading it. He had been ill in bed.
There was no
direct support of the evidence of Mr Burgoyne, but there was other evidence to
which the judge paid considerable attention. Before I come to this I should
relate some of the other events which took place. The plaintiff used the land
during the grazing season of 1974 and then, at a meeting sometime in early
1975, Mr Burgoyne said that he agreed to sell the grass keep again for 1975,
and a cheque for £55 was paid on April 15 when Mr Burgoyne called on the
plaintiff to ask for the payment.
It appears
from the judge’s judgment that he was disposed to prefer the evidence of Mr
Burgoyne to that of the plaintiff, but because Mr Burgoyne was ill and in
hospital (his evidence was taken in hospital; the judge going to the hospital)
the judge felt reluctant to prefer his evidence in the absence of other
evidence which tended to support it. It appears from the judge’s judgment that
there were three matters supporting Mr Burgoyne, one of which was decisive in
his mind. That was this:
First of all,
the evidence of Mr Chapman. Mr Chapman was an adjoining landowner and he gave
evidence that in 1975 (he had originally given a different year) the plaintiff
asked him if he could do the same as Mr Burgoyne and told Mr Chapman that he
had bought the grass on the Burgoyne land and had the option of buying the
land. He wanted to use the land for 12 months to see how it shaped up. The
judge said about this:
This is a
vital piece of evidence. This ties in with what Mr Burgoyne said. I find it
incredible that Mr Stone, who is a man who knows well the difference between
grass keep and a tenancy, should make an error about this. If I was in any
doubt about Mr Burgoyne’s evidence, it is made firm by the account Mr Chapman
gives about what he was told later.
(‘later’ refers
to a later date when the conversation took place). This evidence the judge
regarded as confirming his view that Mr Burgoyne was right and that of the
plaintiff was not to be accepted.
There were two
other matters which the judge did not regard as important but should be
mentioned, namely, firstly that the drainage board rate, which is levied
annually on the occupier of the land, was paid in the first year by Mr
Burgoyne, in the second year by Mr Whitcombe and never by the plaintiff.
Secondly, the payment in advance of £55 was more consistent with the sale of
grass keep than with a tenancy.
Mr Wigmore
submitted that Mr Chapman’s evidence was inherently improbable and that the
judge was wrong to pay attention to it. In my view the attack on the judge’s
findings of fact is really almost unarguable. This case was one which depended
very much on the impression that the witnesses made: the judge has made clear
his reasoning in arriving at his conclusion and I do not think it is possible
to change it in any way. I have dealt with this shortly because I entirely
agree with the way in which the judge has set out the facts under his findings.
I come next to
the plaintiff’s alternative submission. Mr Wigmore was asked by my Lord if he
would summarise on paper his main contention, and this is his contention:
Whether upon
the finding of the judge that there was an express agreement to grant to the
plaintiff the right to occupy land for grazing or mowing for 12 months, it was
open to the judge upon a true construction of the proviso to section 2(1) of
the Agricultural Holdings Act 1948, and upon the evidence, to hold that the
agreement was in contemplation of the use of the land only for a specified period
of the year.
Then the
proviso, which, of course, is of the essence in this case:
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 . . .
.
The critical
finding on which this ground of appeal is based is contained in the learned
judge’s judgment where he says:
I find that
the agreement between the plaintiff and Mr Burgoyne was that Mr Burgoyne agreed
to sell the plaintiff grazing rights to the grass from Lady Day to Lady Day,
1974 to 1975. By a fresh agreement he gave further grazing rights over the said
land from March 25 1975 to March 25 1976.
Mr Wigmore’s
submission is that the judge, having made that finding, it was not possible to
say the proviso applied.
I read also
another part of the judge’s judgment in which he enlarges upon that finding. He
said this:
I have come
to the conclusion that the effect of the proviso is this: where the agreement
or grant of licence is made in contemplation of using the land only for grazing
or mowing during some specified part of the year, this applies only to the
period of grazing or mowing and not to use ancillary to grazing or mowing.
The submission
on behalf of the appellant is that this finding was not open to the learned
judge because the period ran from Lady Day to Lady Day, and from March 25 to
March 25 and that the second period was consecutive to the first. Mr Wigmore
submitted that although the grazing only covered the period from March to
October, this was not a specified period because it would vary from year to
year, and furthermore there was a right to go on the land at other times for
purposes ancillary to grazing: therefore he submitted that in fact it was a
licence for 12 months, which would be converted into a tenancy from year to
year because the proviso would not then apply.
It is
necessary first to consider the evidence relating to the grazing season. The
plaintiff said, when asked about the use of the land:
Land would be
used for grazing or mowing only from about April to November as impractical to
use any other time. When took land realised would use it grazing, mowing only
and during grazing season.
There is also
evidence from both surveyors. Mr M J Garrett [FRICS] agreed that land could be
used only for grazing during the fairly short season. He had said that payment
for grass keep could be in April. Then Mr L B Sellick [FRICS] both in
evidence-in-chief and in cross-examination, said: ‘Would normally sell grass
April to October. No one could expect to stock land after November.’ The plaintiff’s son, who was also called,
said:
I think in
1974 we only stocked it once for two to three weeks. Stock off in October to
November.
There was no
evidence to the contrary of those witnesses.
The judge
amplified his view of the agreement in two other passages, one when he was
resolving the factual dispute, he having said:
The two
accounts are contradictory, for a tenancy is a very different thing from an
agreement to sell grass. I find that the agreement to sell grass or keep in
this area was the right to graze cattle on the land during the limited season
in which cattle are normally grazed from April to October.
He also said:
The land could
only be used during the customary period of the year, and that accordingly,
comes within the proviso.
He went on:
Mr Burgoyne’s
attitude towards Mr Stone is still one of friendship; one has to read into the
agreements between the parties that it was in their contemplation that the land
would be used only during the season of the year. They knew what the ordinary
custom was.
Unless it can
be said that ‘specified’ in the section requires a firm date, the submission
that the period was not specified is, in my opinion, not made out. The evidence
was, in fact, all one way. The period was specified as the period of grazing or
mowing (that was the judge’s finding); the judge quoted the plaintiff and said:
‘. . . it is plain from the plaintiff’s answers that this land can only be used
during a limited period of the year (April to October or early November) for
cattle.’ The judge found that the
plaintiff and Mr Burgoyne were well aware of the difference and said: ‘. . . I
am sure the plaintiff knew exactly what the difference was’: and there is the
passage which I have already read, to the same effect.
When
considering the various arguments which have been put forward, it is necessary
first to consider what is the nature of the licence which can be converted into
a tenancy from year to year. Lord Diplock, in Bahamas International Trust Co
Ltd v Threadgold [1974] 1 WLR 1514, said at p 1527 when dealing with
this particular problem:
To come
within section 2(1) of the Agricultural Holdings Act 1948 the licence granted
under an agreement must be a ‘licence to occupy land for use as
agricultural land’. To satisfy this requirement the right of occupation for
agricultural purposes must be an exclusive right under which the grantee is
entitled to prevent the grantor and any other person authorised by the grantor
from making any use of the land, at any rate for agricultural purposes, during
the period of the grant.
So one has to
consider whether or not there was a licence giving an exclusive right to the
land for the relevant period. Provisionally it seems that there was an
exclusive right to go on to the land for the purpose of feeding cattle and
mowing during the season which both parties recognise as being from April to
October or November, but there is no evidence that I can see that there was any
exclusive right apart from that period; I should, however, also refer to the
judgment of Parker LJ in Scene Estate Ltd v Amos [1957] 2 QB
2095, at p 212, where he was considering the meaning of this section and
proviso. He said 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 [1955] 1 QB 214; 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, 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. . . .
The test is,
taking both of those authorities: was it in contemplation that the plaintiff
should have exclusive use of the land for the whole of the period from Lady Day
to Lady Day, or was it only in contemplation that he should have exclusive use
during the period when he could provide feed for his cattle or mowing.
In my judgment
it is clear from the understanding of the two parties, although the words used
included the period Lady Day to Lady Day, that they contemplated use only
during the season when it was possible to graze cattle, or to mow. But there is
a question — raised again by Mr Wigmore — whether ‘specified’ means specified
in terms and that it is not sufficient to take a period which everybody
understands but which may vary from year to year because the season starts
early or finishes late, as the case may be, but in Mackenzie v Laird
1959 SLT 268, the court had to consider whether, if there was seasonal letting
of the land for grazing, that would be ‘during some specified period of the
year’. It is unnecessary for me to cite the words of the Lord Justice-Clerk or
others of their Lordships in the judgments which they gave. Suffice it to say
that they held that letting during the grazing season is letting for a
specified period of the year and it would be in that particular case within the
contemplation of the parties that use would be made of the land during the
grazing season. If I had felt any difficulty in coming to the conclusion that
the period could be specified without there being specific dates, that would
remove any doubt that I had.
The plaintiff
also submits that use for purposes ancillary to grazing during the non-grazing
months would result in a continuous right to possession on the part of the plaintiff.
The only evidence of such use was that in March 1975 the plaintiff did go on
the land to rotovate. In my opinion, the specified period was for grazing and
it is not possible to add to that other periods, for example, a period for
rotovating.
In the case of
Avon County Council v Clothier (1977) 242 EG 1048, [1977] 1 EGLR
4 the question arose as to whether certain buildings which were adjacent to the
grazing were covered by the proviso, and it was held in this court that as they
were ancillary to the grazing they were
during the season — work which was not in itself grazing or mowing — that would
be ancillary to the grazing or mowing: for instance, if rotovating or ditching
were being done. Whether or not there was a right to do anything outside the
period is, in my view, much more doubtful.
Mr Burgoyne
was asked for the grass again in 1975. There would be no point in the plaintiff
having the right to rotovate after, say, November 1974, unless he had already
had the promise of the grazing and mowing in 1975; but even if there were a
right to go on the land for some purpose ancillary to grazing or mowing, it
would not, in my view, be a right to exclusive possession and, therefore, would
not fulfil the test set out by Lord Diplock in Bahamas International Trust
Co Ltd v Threadgold [1974] 1 WLR 1514 at p. 1527, mentioned above.
For these
reasons I have come to the conclusion that the judge was correct in the
judgment which he gave. The agreement was for a sale of grazing rights. It was
the grant of a licence made in contemplation of the use of the land only for
grazing or mowing during some specified period of the year and, therefore, he
was correct in finding for the defendants. I would dismiss this appeal.
Agreeing, DAME
ELIZABETH LANE said: I would add only this on one submission made by Mr
Wigmore; and that is, that this is a case where it was clearly shown and found
what was in the contemplation of the parties, and it was not a mere case of
expectation, or expectancy, which on authority is something less than is
required to bring the agreement within the proviso of this subsection.
Also agreeing,
STEPHENSON LJ said: The judge was, in my opinion, entitled to prefer the
evidence of Mr Burgoyne, supported as it was by the evidence of Mr Chapman, and
to reject the plaintiff’s evidence that the agreements of 1974 and 1975 were
for a tenancy. The learned judge balanced all the relevant pointers in both
directions, with characteristic care and common sense, including the use of the
word ‘rent’. The significance of that word is even less when used in receipts
of the plaintiff’s own making, one of which the judge found, on the acceptable
evidence of an independent witness, to be a deliberate misrepresentation of the
nature of the receipted payment.
The judge’s
careful understatement that ‘the plaintiff was not as careful of other people’s
rights as he should have been’ was justified by the evidence and led inevitably
to the failure of the plaintiff’s pleaded case. The judge was accordingly
entitled to find, as he did, in a passage already read by Waller LJ: ‘. . .
that the agreement between the plaintiff and Mr Burgoyne was that Mr Burgoyne
agreed to sell the plaintiff grazing rights to the grass from Lady Day to Lady
Day, 1974 to 1975. By a fresh agreement he gave further grazing rights over the
said land from March 25 1975 to March 25 1976.’
So the plaintiff was granted a licence to occupy Mr Burgoyne’s land for
use as agricultural land, which section 2(1) of the Agricultural Holdings Act
1948 made to take effect as a tenancy from year to year unless the granting of
the licence was made in contemplation of the use of the land only for grazing
or mowing during some specified period of the year.
The judge
found, in another passage which my Lord has read: ‘that the agreement to sell
grass or keep in this area was the right to graze cattle on the land during the
limited season in which cattle are normally grazed from April to October’. I
think that Mr Dunn, for the defendant, is right in regarding that as a finding
that the grant was made, both in 1974 and in 1975, in contemplation of the use
of the land only for grazing or mowing, and only for that purpose during some
specified part of each of those years — to adopt the interpretation put upon
the words of the proviso by Parker LJ in the passage from Scene Estate Ltd
v Amos which my Lord has read.
Was the judge
entitled to find that that was the use contemplated by the grant and the
agreement?
The period of
the year, or limited season of contemplated use, was not exactly defined, but
it does not have to be. . . . ‘if the period of the year is one which is
capable of reasonably clear ascertainment, the language of the proviso is
satisfied’, said Lord Patrick in Mackenzie v Laird 1959 SLT 268
at p 272, with which I respectfully agree. The learned judge found the period
to be April to October. The plaintiff called it April to November and was
supported by his son, Clive. The plaintiff’s expert, Mr Garrett, called the
season ‘fairly short’. The defendant’s expert plumped for April to October,
which could be extended to November.
In my judgment
the judge was entitled to find that the season was April to October, or November.
Was he also entitled to find that the use for grazing and mowing during that
period was all that was contemplated by the plaintiff and Mr Burgoyne, or was
that finding inconsistent with the grant of grazing rights to the grass from
Lady Day to Lady Day?
First, that
use was the actual use which the plaintiff made of the land with the exception
of the rotovation of the soil on the 5 acres in March 1975, and possibly the
putting of artificials on the soil and chain harrowing, or rolling it at an
unspecified date. Next, that was the only use to which the land could be put,
according to the evidence of the plaintiff and both expert w2itnesses. Finally,
and most important of all, that was the plaintiff’s own view of what was
contemplated, as is abundantly plain from the passage which has been read from
his evidence: ‘The land would be used for grazing or mowing only from about
April to November as impractical to use any other time. When took land realised
would use it grazing, mowing only and during grazing season.’
The difficulty
in the way of accepting that evidence at its face value, and that its effect is
to bring this agreement within the words of the proviso, lies in the expressed
duration of the agreement as for a year certain from Lady Day to Lady Day.
That, in the opinion of the defendant’s expert, made it a surprising agreement.
Why was that surprising feature admittedly expressed in the agreement unless
the parties contemplated a permitted use for grazing or mowing, not for part of
a year but for a whole year? My answer
to that is that it was expressed because it was suggested by the plaintiff,
with the intention of making sure that he would get some security — perhaps the
security of an agricultural tenant — and it was accepted by Mr Burgoyne because
he believed it would not have that effect. Does it have that effect? Mr Wigmore has powerfully submitted that it
does.
After some
vacillation of mind I conclude that it does not, I respectfully agree with what
Denning LJ said in Reid v Dawson [1955] 1 QB 214 at p 217, that a
simple letting of grazing for one whole year would be caught by the Act without
escape through the proviso. So would a simple licence to occupy for grazing and
mowing for a whole year. Hence the device of letting for 364 days or licensing
grasskeep for eight months only. But the question here is whether the licence
to occupy for a whole year was made in contemplation only of its use for a
particular purpose for a period of less than a year. The language of the
proviso, taking agreements out of the subsection, uses ordinary words, nowhere
better interpreted, if I may respectfully say so, than by Denning LJ in Scene
Estate Ltd v Amos [1957] 2 QB 205 at p 211. There, the learned Lord
Justice said:
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.
There the Lord
Justice appears to have had in mind an agreement into which the contemplated
use could be implied from its expression in a previous agreement, and he
expresses the opinion that in the ordinary way it is from the terms of the
agreement alone that the contemplation of the parties can be gathered. But it
seems to me, on principle and authority, to be a question of fact, to be
decided on the express terms of the agreement and on extrinsic evidence,
whether a landowner and the party he licenses to graze or mow his land both
contemplate only a specified part of the year and only for that grazing and
mowing, even when the agreement is to run for a year certain. Was it
contemplated that though there were to be grazing rights to the grass for 12
months, those rights of grazing and mowing were only to be exercised during
what the plaintiff himself called ‘the grazing season’?
Parker LJ said
in Scene Estate Ltd v Amos, supra, at p 213:
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.
And it might be
said that under this agreement the plaintiff had the power to graze and mow,
and Mr Burgoyne was under an obligation to let him graze and mow, during the
rest of the year outside the grazing and mowing season. Grazing rights included
such rights ancillary or incidental to taking the grass for grazing stock, or
for mowing and sale, by fencing, rotovating or fertilising, which would be exercisable
throughout the year.
The decision
of this court on the ancillary use of buildings during the period of
contemplated use in Avon County Council v Clothier, to which
Waller LJ has referred, is relied upon by Mr Wigmore. But Parker LJ’s words
were spoken in a case where the court was asked to assume that the parties
contemplated an extension of the time provided for by the agreement, not a
reduction of the time. They were prefaced by the phrase ‘prima facie’ and ended
with a reference to ‘that very thing’, which was ‘use for grazing purposes
only’ and were not concerned with ancillary purposes. If Parker LJ’s words
impose a different interpretation from Denning LJ’s on the language of the
proviso, and could apply to this case, I would prefer to follow Denning LJ and
ask: ‘Was there adequate evidence that the plaintiff and Mr Burgoyne
contemplated physically using this land only for mowing and grazing and only
for the seven or eight months when that was practical?’
If ‘grazing or
mowing’ includes incidental or ancillary activities, there was admittedly no
specific evidence of ancillary activities being contemplated by either parties.
Mr Burgoyne gave no evidence himself of what was in his contemplation; but the
plaintiff did, and I have quoted the passage in which he says what that
contemplation was. The learned judge was entitled to infer from his evidence
and all the rest of the evidence that what was in contemplation was the use of
this land for grazing and mowing during the short season. So I would answer
that question, ‘yes’. That may mean that references in the evidence to selling
the grass for 12 months, and from Lady Day to Lady Day, were ineffective to
confer any rights beyond that of occupation for use as agricultural land,
perhaps so as to exclude anybody else from using it out of the grazing season
for agricultural purposes: see what Lord Diplock said in the passage from Bahamas
International Trust Co Ltd v Threadgold [1974] 1 WLR 1514 at p 1527
which Waller LJ has quoted.
What was
contemplated when these agreements were made was, in my judgment, the exercise
of grazing rights, or rights of grazing and mowing, or rights to the grass,
within the grazing season only. The plaintiff’s suggestion, adopted by Mr
Burgoyne, may have given the plaintiff the right to stop others using or doing
things on this land throughout the year, but it did not, in my judgment, give
him the right to exercise his rights to the grass outside the grazing season or
show that both he and Mr Burgoyne contemplated the exercise of those rights
outside that season.
I would
therefore agree in dismissing this appeal.
The appeal
was dismissed with costs.
