James Fleming v Ladykirk Estates Ltd

4 May 2009

Scottish Land Court 28/4/09

In this Application, the assignee of an agricultural tenancy sought declarator that the landlord had intimated no reasonable grounds for withholding consent to the proposed assignation within the meaning of section 10A of the Agricultural Holdings (Scotland) Act 1991.  This is the court's second decision on the new statutory provision introduced by section 66 of the Agricultural Holdings (Scotland) Act 2003.  The first case was Luss Estates v Sturgeon 2006 SLCR (1) 96.

In Fleming the Court accepted the Applicant's arguments and held that (i) Article 1 of the First Protocol of ECHR was engaged but had not been breached; (ii) section 10A has a legitimate purpose; the Landlord failed to discharge the onus of asserting a breach of Article 1; (iii) its own decision in Luss Estates v Sturgeon (in which J Gordon Reid also appeared) was correct; (iv) a tenant is entitled to treat an unreasonable refusal as a deemed consent and go ahead with the assignation; (v) a covering letter was to be read along with the formal notice intimating the assignation; (vi) the statutory word particulars only required identification of the proposed assignee and his relationship with the cedent;  (vii) the onus lies on the landlord to show that there are reasonable grounds for withholding consent (albeit viewed from the Landlord's perspective); (viii) loss of section 25 rights and loss of the right to object to a successor on death of the tenant are not reasonable grounds of objection; (ix) lack of information about the proposed assignee is not a reasonable ground without making reasonable enquiries; (x) the tenant need not spell out how the assignee will fulfil his obligations under the tenancy; and (xi) the fact that the lease excludes assignees is irrelevant.  A residuary argument based on personal bar was not considered by the Court.  This may prove to be academic in the light of the court's decision on the main issues.

J Gordon Reid QC of Axiom Advocates appeared for the Applicant.

A Report of the case will appear on the Scottish Land Court Website in due course (http://www.scottish-land-court.org.uk/recent.html)