Tag Archives: partial ownership

Crofting Commission make a U-turn on Decrofting Appeal to the benefit of many owner-occupiers

Crofting Commission make a U-turn on decrofting appealThe Crofting Commission today confirmed that it has withdrawn its appeal to the Court of Session in connection with the Scottish Land Court’s decision of 18 December 2014 in the case of MacGillivray v Crofting Commission. That case concerned the Crofting Commission’s policy on decrofting where a croft unit is held in multiple ownership.

On 14 December 2012 Crofting Commissioners agreed to adopt a policy that all decrofting and letting applications in respect of crofts with multiple owners, must be submitted by all the owners, in their capacity collectively as the ‘landlord’ of the croft, even in those cases where the application related to a part of the croft held in title by only one of their number. This decision was based on legal advice obtained by the Crofting Commission but never published by them.

This is a sensible decision by the Crofting Commission and puts the position back to what it was before they decided on 14 December 2012 to interpret crofting law in a way that I do not believe was ever intended by the Scottish Government. The Land Court decision was a clear, sensible and fair one and it makes much sense for the Crofting Commission to abide by it.

There will be a huge sense of relief amongst owner-occupiers of croft land who are not classified in law as owner-occupier crofters. They can now apply to decroft land that they own without requiring the consent of neighbours who happen to be owners of part of the original croft unit. The lack of such consent in certain instances was causing huge problems for many who have been in a state of limbo for over two years now.

The Crofting Commission in their official press release have stated:-

Due to the fixed deadline for submitting an appeal, the Crofting Commission submitted a skeleton appeal to provide it with sufficient time to convene the full Commission and allow it to discuss the implications of the decision.

The Commission met last week to review the case and it was decided to withdraw the appeal and accept the ruling of the Land Court which establishes that a single owner, as the landlord of their part of the croft, are entitled to submit a regulatory decrofting application to the Commission.

The Crofting Commission had originally found Mr & Mrs MacGillivray’s application to decroft land at 37 North Ballachulish for house building to have been incompetent, therefore, the Commission could not take a decision on it.  The recent Scottish Land Court ruling found the application to be competent.  No decision has been made yet on the merits of the application which the Commission will now have to reconsider.

The case challenged the Commission’s policy which was adopted at its Board meeting on 14 December 2012.  The policy found that all decrofting and letting applications in respect of crofts with multiple owners, must be submitted by all of the owners, in their capacity collectively as the ‘landlord’ of the croft.

The Land Court has ruled that in a multiple ownership situation one of the owners can apply independently from the other owners where the application solely relates to the land that they own.

Crofting Commission Convener, Susan Walker said “The ruling has implications on part croft owners in relation to the requirement to register the croft prior to submitting certain regulatory applications.  The Commission is working to align our policy to the ruling and will begin to process applications relating to part crofts from single owners.”

Brian Inkster

Decrofting uncertainty continues as Crofting Commission take case to the Court of Session

Court of SessionThe Crofting Commission last week lodged a request that a special case be stated on a question of law for the opinion of the Court of Session in connection with the Land Court’s decision of 18 December 2014 in the case of MacGillivray v Crofting Commission. That case concerned the Crofting Commission’s policy on decrofting where a croft unit is held in multiple ownership.

On 14 December 2012 Crofting Commissioners agreed to adopt a policy that all decrofting and letting applications in respect of crofts with multiple owners, must be submitted by all the owners, in their capacity collectively as the ‘landlord’ of the croft, even in those cases where the application related to a part of the croft held in title by only one of their number. This decision was based on legal advice obtained by the Commission but never published by them.

For the past two years many people have been affected by this policy decision and have been unable to decroft and thus develop land they own if a neighbour who happens to own part of the original croft unit is not willing to consent to the proposed development taking place. Mr & Mrs MacGillivray were in that very position. Their application to decroft land at North Ballachulish for house building had been rejected by the Crofting Commission because it did not have the consent of the landlord of that part of the original croft unit that remained in tenancy. Mr & Mrs MacGillivray referred the matter to the Scottish Land Court who decided that the Crofting Commission were wrong and it was competent for an owner of part of a croft to seek to decroft without requiring the consent of any other owners of the original croft unit. The Land Court took the view that the reference to a croft in the Crofting Acts applied equally to part of a croft.

The Land Court’s decision will have come as a relief to many who have been affected by the Crofting Commission’s policy. However, any hopes of an early resolution to their own predicaments have been dashed by the Crofting Commission appealing that decision to the Court of Session. It is now likely to be many months before a ruling is issued that will settle the matter once and for all.

Many crofting lawyers, including myself, have long held the view that the Crofting Commission’s policy was not a correct interpretation of the law. At the outset I called on this matter to be resolved before the Land Court by the Commission or action to be taken by the Scottish Government to do so. It is a pity that one affected party (there are many) has had to take the Crofting Commission to task over this whilst others have been left in limbo for over two years.

The Land Court’s decision was a clear, sensible and fair one. Even if the Court of Session ultimately were to take a different view, affected parties will continue to lobby the Scottish Government to amend crofting legislation to allow those who own croft land to be able to apply to decroft at their own instance. It is a problem that was highlighted in the final Crofting Law Sump Report as a priority one for the Scottish Government to tackle. They may, of course, not have to tackle it if the Court of Session agrees with the Land Court’s interpretation of the law.

Brian Inkster

Owner-Occupier Crofters

Derek Flyn

Derek Flyn

This is a guest blog post by Derek Flyn who is a retired crofting lawyer and an administrator of the Crofting Law Sump. It was written by Derek on 23 October 2013 so reflects his thoughts on owner-occupier crofters as the law stood at that date.

For this article, it would be best that the reader has available to him a copy of the Crofters (Scotland) Act 1993 as amended by 2007 Act and by 2010 Act and by 2013 Act [PDF].  However it is necessary to discuss how some of the provisions of the 1993 Act came into being.

Whilst there appears to have been no mechanism specifically designed to keep track of the ownership of the estates of landlords in whole or in part, changes in occupation of crofts required to be recorded in the Register of Crofts.  This was especially true of vacant crofts and section 16 of the 1955 Act, now section 23 of the 1993 Act, made provisions in respect of vacant crofts, somewhat unusually placing a burden on every crofting landlord.  There was imposed on the landlord an obligation to inform the Commission about any croft that became vacant  [1955 Act, s 16(1); now 1993 Act, s 23(1)]. Failure to do so was to be met by criminal sanction on summary conviction [1955 Act, s 16(10); now 1993 Act, s 23(2)].

Whilst launching the statutory purchase provisions for tenant crofters, the 1976 Act introduced a rather awkward subsection [1955 Act, s 16(14); now 1993 Act, s 23(12)] declaring that,  for the avoidance of doubt section 23 has effect (and shall be deemed always to have had effect since 27th August 1961) as if (a) a person who has become the owner-occupier of a croft were required under subsection (1) above within one month of the date on which he became such owner-occupier to give notice thereof to the Commission; and (b) any reference in the section other than in subsection (1) above to a landlord included a reference to an owner-occupier”.

The effect was to treat any person who had become the owner-occupier of a croft like a landlord who has a vacant croft (although it is not clear how any sanction could be invoked, if ever it was). It was not necessary to define an owner-occupier by the extent of what he owned because the provision did not differentiate between a part croft and a whole croft [1955 Act, s 16(13) inserted by 1961 Act; now 1993 Act, s 23(11)].

Nor did it seek to differentiate between on the one hand a former tenant crofter who had purchased his own croft and continued to occupy it (or his nominee or successor or a later acquirer of his whole interest) and on the other hand a third party who acquired part of a croft intending to use it or occupy it himself.

These differences did not cause difficulties, because a croft was to be taken to be vacant notwithstanding it was occupied, if it was occupied otherwise than by the tenant of the croft [1955 Act, s 16(11); now 1993 Act, s 23(10) but amended in 2010] and that notwithstanding that the tenant crofter had an approved sub-tenant or had purchased the croft himself.

Any occupancy of a croft outwith an approved tenancy was conclusive that the croft was to be considered vacant. So a crofter who purchased his own croft (albeit encouraged by the 1976 Act to do so) was to be in the same position as the landlord of a vacant croft. This nonsensical approach (to any croft purchased by and which remained in the occupancy of its former tenant) was the source of much confusion and annoyance. Despite the opportunity afforded by the 1993 consolidation, no amendments of policy were to be admitted and no legislative attempt was made to sort it out.

It was not until the 2010 Act that there was statutory recognition that tenant crofters who purchased their croft were apt to continue to occupy their own crofts, and this some 34 years after the purchase provisions had been introduced. They were to be recognised as “owner-occupier crofters” and new sections 19B to 19D were inserted into the 1993 Act specifically to cover their now privileged position.

But all was not well.

Who then is an owner-occupier crofter?

The definition is found in section 19B(1) which provides that a person is an “owner-occupier crofter” if the conditions in subsections (2)-(4) are fulfilled:

THE FIRST CONDITION [Section 19B(2)]

The first condition is that the person is the owner of a croft.

The croft: The first problem is what constitutes a croft for this condition to have effect?

The croft needs to be wholly owned.  The whole croft must be owned, identified as a unit. But what does this mean?

One obvious difficulty is that the 1976 purchase provisions did not require the crofter to purchase his whole croft but allowed purchase of part of the croft.

The whole croft would appear to mean, keeping in mind said purchase provisions, (1) the site of the dwellinghouse (if any) and (2) the croft land.  Given the wording of the purchase provisions, can any restricted meaning of croft land be presumed?  For example, does it mean that any apportionments must be owned if they are contiguous and adjacent to the remainder of the croft? One might think not since apportionments are now to have a temporary nature. But the Land Court in an appeal decision by the Full Court as recently as 26 September 2013¹  have opined that, “once granted, an apportionment effectively becomes part of a croft”. It is no help that section 13(3) indicates that, for the purchase provisions, “croft land” includes any land comprising any part of a common grazing that has been apportioned and is adjacent or contiguous to any other part of the croft or consists of arable machair.

Meanwhile, section 3(5) considers the situation where a crofter has acquired his entire croft other than any right in pasture or grazing land and any apportionment. Does such a crofter become an owner-occupier crofter? It seems doubtful that he should be expected to include in his acquisition any right in pasture or grazing land or any apportionment because there is a provision which deems any such unpurchased interest to be held in tenancy until held otherwise. A further provision goes on to deem that interest to be a croft. The Land Court has been “satisfied that the plain intention of sec 3(5) was to allow a grazing share or apportionment which had not been purchased, to be treated as a separate independent croft”².  That being so the person, who now owns the entire croft stripped of that which was not acquired, must be “the owner of a croft”.

Of course, if a croft has been wholly acquired but any part has been conveyed away without decrofting taking place, the person is not the owner of the croft, only the remaining part.

The person:  The second problem is the matter of plurality. There is nothing to suggest that the person must be a singular natural person.

It has been normal for a purchasing crofter to take his title in joint names, for instance himself and his spouse.  If this is permitted, it seems that more than one person can be the owner-occupier crofter of a croft, but those persons must own the entire croft jointly and their title must be in their joint names.

Partial ownership: Persons who own only part of a croft are not considered to be owner-occupier crofters because they cannot satisfy the first condition. Accordingly, they must be regarded as landlords of part of a vacant croft.  Situations like this may have arisen due to the transfer of ownership of parts of a croft on the (mistaken) assumption that the croft would be automatically divided.

It is the clear intention of the 1993 Act, that any division of a croft (whether by a tenant crofter or owner-occupier crofter) can only be effected following an application and subsequent affirmative decision of the Commission. Since 2010, an owner-occupier crofter may not transfer (whether or not for valuable consideration) ownership of any part of the owner-occupier’s croft without first dividing the croft into the part which the owner-occupier crofter proposes to transfer and the part which the owner-occupier crofter proposes to retain³.  Any transfer of ownership of any part of an owner-occupied croft which is not a new croft created by a division under this section, and any deed purporting to transfer ownership of that part, is null and void⁴  and in such a case the Commission can declare the original croft vacant⁵.

THE SECOND CONDITION (Section 19B(3))

The second condition requires that the person (already identified as the owner of the croft):
(a) was the crofter of the croft at the time of acquiring it (or is such a tenant crofter’s successor in title);
(b) acquired title to the croft as the nominee of a crofter (or is such a nominee’s successor in title); or
(c) purchased the croft from the constituting landlord⁶  (or is such a purchaser’s successor in title).

As an aside it will be noted that in some cases acquisition of the landlord’s interest in the croft, where the tenant crofter nominates another person or persons to take title, has avoided the loss of his tenancy. But where that tenancy cannot be held to have continued beyond the date of acquisition, it seems that any person or persons who became the owner of the croft having received the landlord’s interest as nominee of the tenant crofter can claim to be the owner-occupier crofter.

THE THIRD CONDITION (Section 19B(4))

The third condition is that the croft has not been let at any time since it was acquired to any person as a tenant crofter either by an enforced letting of an owner-occupied croft by the Commission or otherwise.

If all the conditions are fulfilled, such a croft is identified as an owner-occupied croft and the properties of an owner-occupied croft therefore attach to the croft itself until it is again a let subject.

But although it is without a tenant, it is not to be taken as being vacant of it is occupied by an owner-occupier crofter. This is stated to be so by subsection 23(10) although it uses a roundabout way of doing so.

Owner-occupier crofters as a sub-set of owner occupiers

Owner occupiers have been recognised by the Crofting Acts since 1976, when they were required to tell the Commission⁷.  The effect of the requirement is not altogether clear although it does say something along the lines that (a) a person who has become the owner-occupier of a croft is required within one month of the date on which he became such owner-occupier to give notice thereof to the Commission and (b) most references to a landlord are to include a reference to an owner-occupier.

But since 2010 this has been qualified by a new subsection 23(12A) which states that where the owner-occupier is an owner-occupier crofter, he must give notice of that fact to the Commission within one month of becoming such an owner-occupier crofter.

It seems that unless or until an owner-occupier crofter gives notice of the fact that he is an owner-occupier crofter, he will not be recognised as such by the Commission.

Not only that, any owner-occupier crofter (or indeed any owner occupier) will be guilty of an offence if he does not inform the Commission within one month of his becoming an owner-occupier crofter (or owner occupier).

If the reader is still with me, then I applaud his tenacity.

It was on Christmas Eve 2012 that I asked myself,
“If an owner-occupier crofter’s croft is not vacant, [subsection 23(10)] then, even if an owner-occupier crofter is to be taken as a landlord, [subsection 23(12A)] then how can subsection 24(3) apply when it reads “Where a croft is vacant, the Commission may, on the application of the landlord, direct that the croft shall cease to be a croft or refuse to grant the application”?

I then asked the Commission,
“On what authority does the Commission deal with an application from an owner-occupier crofter to decroft land?”

The answer is now history. The answer is to be found in the Crofting (Amendment) (Scotland) Act 2013.

Derek Flyn – 23 October 2013

Footnotes:-

  1. Kennedy v Smith & Crofting Commission SLC/31/12 at [3]
  2. Reference by Crofters Commission under Sec 53 Crofters (Scotland) Act 1993 SLC/121/11 at [23]
  3. 1993 Act, s 19D(1)
  4. 1993 Act, s 19D(6)
  5. 1993 Act, s 19D(7)
  6. as defined in section 19B(6)
  7. i.e. since s 16(4) was added to the 1955 Act by the 1976 Act, now s 23(12) of the 1993 Act