Tag Archives: top secret

A pivotal year for Crofting Law

Scottish Legal News Crofting Review 2014This is an article that Brian Inkster wrote for the Scottish Legal News Annual Review 2014:-

2013 was certainly a year to remember in the world of crofting law. It started in February when the Crofting Commission issued a statement concerning decrofting applications made by owner-occupier crofters who occupy their crofts.

The Commission, having taken legal advice on the question of whether or not an owner-occupier crofter can decroft part or all of their croft, stated that they believed the amendments introduced by the Crofting Reform (Scotland) Act 2010 (“the 2010 Act”) did not make provision for an owner-occupier crofter to decroft if he is occupying his croft.

Furthermore, the Commission stated that they had been advised that they would be acting outwith their statutory authority if they approved any application made to decroft, and that no further applications would be considered until a remedy was found, with applications at that time in process being placed in abeyance.

The implications of this were significant to say the least. The Crofting Commission were not only preventing owner-occupier crofters and connected third parties from building houses or carrying out other developments but they were in effect saying that decrofting directions already granted by them may be invalid. If such directions were invalid then, if title deeds had been granted in reliance of those directions, those title deeds would be null and void. This is because applications to divide an owner-occupied croft will not have been made prior to transfer (such applications not being necessary if the land was decrofted but necessary if the land was not decrofted). Banks who had granted mortgages in reliance of such decrofting directions were also exposed.

I looked at the legislation and simply could not see the problem perceived by the Crofting Commission. I published an opinion setting out why the existing legislation clearly provided for decrofting by owner-occupier crofters. To date that opinion has not been openly challenged and the Crofting Commission refused to publish their legal opinion (so no one knows the actual reasoning behind the Commission’s decision to halt processing decrofting applications).

Faced with differing legal opinion the Scottish Government decided to introduce a Crofting (Amendment) (Scotland) Bill and rush it through Parliament with all due haste. The Bill they drafted was, in my opinion, a sledge hammer to crack a nut with the potential to introduce even more unintended consequences into crofting law. I suggested and drafted a shorter version at 621 words rather than 1,700 words. I and the other crofting lawyers who put forward submissions were ignored. The Bill was enacted as originally drafted without any amendment whatsoever during the three stages that it very quickly passed through the Scottish Parliament. The Crofting (Amendment) (Scotland) Act 2013 become law on 31 July 2013 when it received Royal Assent.

The Scottish Government, during the passage of the Bill, continually sidestepped another fairly significant issue that was causing difficulty for many owner-occupiers who were not classed by the 2010 Act as owner-occupier crofters. Back in February the Crofting Commission had also published a statement on decrofting by owner-occupiers who were not owner-occupier crofters. Their view, having obtained legal advice, was that if an original croft unit had been split into different parts each owned by a separate owner-occupier then no one owner-occupier could decroft part of their own land without the consent and concurrence of the neighbouring owner-occupiers. The end result is that if you fall into this category and don’t want your neighbour developing land that they own you can simply prevent them from so doing.

A Scottish Government Official said that he hoped everybody would be able to work together at some point to recognise the benefits by concurring in decrofting applications. Tavish Scott MSP pointed out that “we do not live in a perfect world”. Time has shown that we don’t with several examples arising of owner-occupiers being prevented from developing their land.

This problem could easily have been cured by a minor provision within the Crofting (Amendment) (Scotland) Act 2013. The Scottish Government by ignoring the issue have allowed the problem to manifest itself as time goes on. They may well be forced to consider a further Crofting Amendment Bill to fix it.

During the passage of the latest Bill it became apparent to MSPs that much was wrong with Crofting Law. Many of these problems stem from the fact that the 2010 Act was the result of a Bill that had 230 amendments all dealt with at Stage 3 in less than 3 hours.

Alex Fergusson MSP said “The whole thing seems to me to be a bit like the Hydra—you cut off one head and two others appear. With crofting, we get rid of one problem and two others appear in its place.”

Paul Wheelhouse MSP, Minister for Environment and Climate Change with responsibility for crofting, gave an undertaking that his officials would investigate, in consultation with stakeholders, what the best method might be for dealing with these outstanding issues. That consultation is now on-going.

The Crofting Law Group set up a ‘Sump’ to assist the Government in this process. It is being administered by Derek Flyn, retired crofting lawyer, and Keith Graham, formerly Principal Clerk of the Scottish Land Court. They are collating the issues and problems that are causing difficulties, prioritising them and indicating how the problem can be resolved. Their Report will be made available to the Scottish Government on completion.

From 30th November compulsory registration in the new Crofting Register, held by Registers of Scotland, was introduced for crofts if certain trigger events occur. The Crofting Register is a product of the 2010 Act and already it is being suggested that there may be unintended consequences arising from the drafting of the legislation. More fodder for the ‘Sump’!

2014 will be a pivotal year for crofting law with the publication of the ‘Sump’ Report and hopefully some indication from the Scottish Government as to what they intend doing to clear up the mess that the 2010 Act created.

Brian Inkster

Crofting (Amendment) (Scotland) Bill: A Sledge Hammer to Crack a Nut

Crofting (Amendment) (Scotland) Bill in Marrakech

A Surface, Cloud Technology and Mint Tea enable submissions on the Bill from Marrakech to Edinburgh

The Scottish Government decided to publish the Crofting (Amendment) (Scotland) Bill, and have a one week consultation period on it, all to coincide exactly with my one week holiday in Marrakech. I reluctantly packed the Bill as holiday reading. My wife, understandably, was not too amused by this turn of events. Crofting Law Bills don’t come along very often I assured her. Whereas, we can always have another holiday. Although, there may well be a spate of Crofting Law Bills to come in the wake of this latest one. Anyway, a good part of my ‘holiday’ was taken up considering the Bill albeit in warmer climes than the Crofting Counties. This resulted in three sets of submissions by me to the Rural Affairs, Climate Change and Environment Committee. The first of these is as follows:-

Submissions (Part 1) by Brian Inkster on the Crofting (Amendment) (Scotland) Bill

I would initially point out that I have, from the outset, been somewhat sceptical as to the need for the Crofting (Amendment) (Scotland) Bill (“the Bill”) as I believe that the existing law can be interpreted in such a way to allow owner-occupier croft decrofting (Vacant and ready, Journal of the Law Society of Scotland, March 2013).

I have also been vocal in expressing the opinion that the legal advice sought and obtained by the Crofting Commission on this subject should be made public (Top Secret Crofting Law, Crofting Law Blog).

To date crofting lawyers have had to operate in a vacuum over this issue as in the absence of sight of the legal opinion on what exactly the ‘flaw’ is in the Crofting Reform (Scotland) Act 2010 (“the 2010 Act”) it is difficult to know what is being amended by the Bill and why.

On 28 March 2013, when Paul Wheelhouse MSP, Minister for Environment and Climate Change, announced in the Scottish Parliament that the Bill would be introduced after the Easter recess, Rhoda Grant MSP asked whether the Government would “publish its legal advice, so that solicitors can properly advise clients”. Paul Wheelhouse responded:-

 As far as legal advice is concerned, I am sure that Rhoda Grant knows the constraints that exist in that regard. In progressing the Bill, we will try to make it as clear as possible why we think that the legislation is flawed and what we need to do to rectify that. We will try to give as much clarity as possible on the rationale for the action that we propose to take.

I had hoped that such clarity and the rationale would appear in the Explanatory Notes to the Bill. Unfortunately, not a lot on this area is actually there to add to the scant information that was previously made available. In particular no mention is made of the interaction between section 23(12A) of the Crofters (Scotland) Act 1993 (“the 1993 Act”) and section 23(1) of the 1993 Act and their relationship with section 23(10) and/or section 24(3) of the 1993 Act. This is something I have specifically asked the Crofting Commission to address in correspondence but they have simply ignored me and not responded on this point. I can only assume that they do not actually know what the position is.

With section 23(12A) of the 1993 Act being amended but not removed by the Bill some explanation as to the purpose and intent of that section, as it now stands, would be useful. If the purpose of that section (as I saw it) was to deem an owner-occupied croft to be vacant but it did not in fact do so (if the legal advice sought and obtained by the Crofting Commission, which has not been disclosed, actually covers this point) then what is the continuing purpose of the said section 23(12A) when the Bill becomes an Act?

Paragraph 5 of the Explanatory Notes to the Bill acknowledge that prior to the introduction of the 2010 Act “owner-occupiers” could apply to decroft under section 24(3) of the 1993 Act and we are told to “see section 23(12) of that Act”. Section 23(12A) was introduced by the 2010 Act to the 1993 Act to extend the same provisions to “owner-occupier crofters”. However, no mention of this or the reason why the said section 23(12A) does not actually do this is given.

Paragraph 6 of the Explanatory Notes to the Bill states that:-

For the purposes of the decrofting provisions of the 1993 Act, section 23(10) was amended by the 2010 Act to provide that a croft is not vacant if it is occupied by the owner-occupier crofter.

That statement is not quite correct and is possibly misleading. The clause in question says that:-

…a croft shall be taken to be vacant notwithstanding that it is occupied, if it is occupied otherwise than by… the owner-occupier crofter of the croft

That does not mean (in my opinion) that an owner-occupied croft can never be vacant and that other provisions of the 1993 Act cannot make such a croft vacant for the purposes of decrofting.

If, however, that interpretation can be put on the said section 23(10) and this is the ‘flaw’ that Paul Whellhouse has been referring to then is there not a simpler way to amend the legislation rather than the rather convoluted way it has been presented in the Bill? Would it not be the case of simply having one clause (say a new section 23(10A) to the 1993 Act) along the following lines:-

Notwithstanding the terms of subsection (10) above an owner-occupied croft will always be vacant for the purposes of decrofting under section 24(3).

This one sentence could in effect replace the proposed new sections 24A, 24B, 24C and 24D to the 1993 Act (section 1(2) of the Bill) and make the reading and understanding of it so much easier.

Paragraph 6 of the Explanatory Notes to the Bill goes on to state:-

Other owner-occupiers of crofts, who were not owner-occupier crofters were unaffected and they could still, and still can, apply to decroft as if they were landlords of vacant crofts.

This is another potentially incorrect and misleading statement. The Crofting Commission issued on 18 February 2013 the following statement:-

Decrofting and Letting applications where a croft is owned by more than one person

There was uncertainty in situations where the owners hold separate title to distinct parts of a croft, whether an application to decroft or let could be:

  • Made separately by an individual owner in respect of the distinct part of the croft they own, or
  • If such an application has to be made by all the owners of the croft in their capacity as, collectively, the ‘landlord’ of that croft.

The Crofting Commission took the view that it was essential to have clear policy on this issue. The Commission therefore, in order to clarify the situation, sought and obtained legal opinion on the practice of accepting applications submitted by only one of the croft owners where the croft is held in multiple separate ownership ‘parcels’.

The matter was discussed at their Board meeting on 14 December 2012 and 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.

Any application received in future from one of the owners, where a croft is held in multiple ownership, will be considered invalid and returned on the basis that the application was not submitted by the landlord of the croft.

It is submitted that this was not the intention of the 2010 Act (i.e. to change the position of owner-occupiers as opposed to owner-occupier crofters in respect of the right of an owner-occupier to decroft land belonging to them). In effect if there are several owner-occupiers of distinct parts of what was originally one croft why should one of those owner-occupiers require the consent of the other owner-occupiers to decroft land that only they own. The policy introduced by the Crofting Commission means that one neighbouring owner-occupier can in effect prevent another from decrofting. Thus, contrary to what the Explanatory Notes to the Bill state, owner-occupiers of crofts, who are not owner-occupier crofters, are affected and cannot (in certain circumstances) apply to decroft as if they were landlords of vacant crofts.

My own view is that the Crofting Commission may have got it wrong again and that decrofting by owner-occupiers is, as it always has been, fully covered by section 23(12) of the 1993 Act. This was not altered in any way by the 2010 Act. However, if the Crofting Commission are correct then the Scottish Government needs to do something about it at the same time as fixing the ‘flaw’ for owner-occupier crofters. It would be inequitable to treat the two differently. Furthermore, if the Crofting Commission are correct then it follows that decrofting directions granted by them to owner-occupiers after 1 October 2011 (possibly arguably before that date) and 18 February 2013 could be invalid. The Scottish Government would need to seek to remedy that situation retrospectively as it has done in the Bill in respect of owner-occupier crofters. Not doing so leaves owner-occupiers and their lenders exposed in a similar way as owner-occupier crofters and their lenders currently find themselves pending the Bill becoming an Act.

Jamie McGrigor MSP asked, in the Scottish Parliament, on 28 March 2013:-

Will the legislation clarify the legal position on decrofting a croft that has been divided? The Crofting Commission say that people who own part of a croft cannot decroft in that part without the concurrence of the neighbours who own the remainder of what was the original croft.

Paul Wheelhouse MSP did not have an immediate answer to this question but the Minister promised to write a letter to Mr McGrigor to provide clarity on this point and undertook “to address the matter”. This letter was not written until 10 May 2013 (the day after the Bill was introduced). It reads:-

Dear Jamie

Thank you for your e-mail of 9 May 2013 seeking the clarification that I undertook to write, after my statement to Parliament on 28 March 2013 on decrofting by owner-occupier crofters, on the issue of “divided” crofts. I am extremely sorry that it has not been possible to provide a much earlier response.

The issue you raised relates to situations where a croft has a number of owners, rather than where a croft has been divided through regulatory application to the Crofting Commission. In that latter situation, a croft would have essentially become two, or more, crofts with a separate identifiable tenant or owner-occupier for each. In such a situation, a tenant would be able to apply to decroft and the Bill to be introduced is designed to empower an owner-occupier crofter to also be able to apply to decroft.

In instances of joint ownership of a croft that has not been formally divided, the Crofting Commission decided, at its Board meeting on 14 December 2012, that in order to regulate crofting properly and ensure the integrity of the crofting unit, an application to decroft should be from the landlord of a croft. As it has been relayed to me the Crofting Commission took legal advice, and based upon that advice has concluded that where a number of individuals own different parts of a croft, which has not been formally divided by the Commission, they together constitute the “landlord” of the croft for regulatory purposes.

As such, an application in respect of an undivided croft affects a number of persons who, taken together, are the “landlord”. In order to properly consider an application relating to such an undivided croft, the Commission feels it necessary, on legal advice it received, to seek the views of all the joint owners of the croft.

I hope this is helpful.

PAUL WHEELHOUSE

Unfortunately, Paul Whelhouse avoids the actual question asked by Jamie McGrigor and simply sets out the Crofting Commission’s policy which was already known. Reference by Paul Wheelhouse to “divided” crofts requires some greater understanding and explanation. It was only by the 2010 Act (section 34 which introduced inter alia a new section 19D to the 1993 Act) that an owner-occupier crofter was, for the first time, compelled to seek the consent of the Commission to divide their croft. Prior to this new provision coming into force no such consent was required.

I do not believe that it could have been the intention of the Scottish Parliament to create two separate types of divided crofts with different rules applying to each. There is no good reason why pre-2010 Act ‘divided’ crofts should be treated differently from post-2010 Act ‘divided’ crofts.

As a result of the Crofting Commission’s legal interpretation of the position, and as already stated previously by me above, decrofting directions already granted by the Crofting Commission to owner-occupiers (as opposed to the newly defined owner-occupier crofters) could be invalid. Furthermore, the Crofting Commission are now effectively preventing owner-occupier decrofting  in circumstances where they believe a neighbour’s consent may be required (something that the 2010 Act and previous crofting legislation certainly does not spell out).

The focus of the Bill is resolving ambiguities created by the 2010 Act in connection with decrofting but this has been specifically limited by the Scottish Government to ‘owner-occupier crofters’. It is completely inequitable not to include ‘owner-occupiers’ in this focus as they are, in certain circumstances, also being prevented from decrofting land that they own. The tweaks required to the Bill (especially if a simplified drafting approach was taken) to resolve this anomaly would be minor and I would urge the Scottish Government to actually consider the potential problem at hand and the consequences of doing nothing about it.

I have already stated that the Bill could be condensed dramatically in size and complexity by a more straightforward and simple approach to the drafting of it. Arguably, what has been created is a sledge hammer to crack a nut. Crofting Law is complex at the best of times. The Scottish Government should be seeking where possible to make it easier to understand and thus avoid the need for amending legislation due to the different interpretations that can be given to complexly drafted provisions.

If, however, the will of the Scottish Parliament is to stick with the unnecessarily complex approach I would comment on the clauses in the Bill, as currently drafted, as follows:-

Clause 1(2) – inserting 24A

There is no definition of “decrofting direction” in section 61 of the 1993 Act. Should we have a definition distinctly for owner-occupier crofters and not one for others who can legitimately seek a ‘decrofting direction’? Again good reason for linking owner-occupied croft decrofting with the existing  decrofting provisions rather than creating new ones.

Clause 1(2) – inserting 24B

Reference is made in the new section 24B(2) to section 26J of the 1993 Act. However, I believe there to be a possible flaw in the 2010 Act (yes another one) in that there is no link between section 26J and section 19C of the 1993 Act. This could cause general problems for the Crofting Commission in any event and specific ones with regard to the Bill now linking a further clause to a section in the 1993 Act that possibly makes no sense in the first place.

Clause 1(2) – inserting 24C

The proposed new section 24C to the 1993 Act is a very contrived provision. The simplified approach to drafting already suggested would dispense with the need for this. The alternative is to set out in full the provisions that apply rather than chopping and changing the existing section 25 of the 1993 Act.

The proposed new section 24C(2) to the 1993 Act appears to be new law in that I cannot see why the existing section 25(1)(b) cannot equally apply as it stands to owner-occupied crofts. There should be no place for new law in the Bill rather than a necessary fix of existing legislation. Any new law requires careful consideration and should not be rushed through as part of this particular legislative process. Thus I would submit that the proposed new section 24C(2) should be removed from the Bill.

With regard to the proposed new section 24C(3) to the 1993 Act there should be nothing to prevent the legislation declaring the croft to be vacant notwithstanding the terms of section 23(10) of the 1993 Act. Why create two classes of possible outcome i.e. vacancy or revocation rather than just the one?

Clause 1(2) – inserting 24D

A simplified drafting approach to the Bill would avoid the need for the proposed section 24D to the 1993 Act with reliance being given to the existing section 24(3) of the 1993 Act.

I am unsure whether the proposed new section 24D(3) to the 1993 Act reflects existing legislation in the 2010 Act in respect of existing decrofting procedures. I have been unable to readily locate such provisions and there is no indication of the position in the Explanatory Notes to the Bill. If it does, then fair enough, although again linking the new legislation to the existing provisions would be preferable to stand alone clauses. If it does not then the Bill is no place for new law for reasons already given above in respect of the proposed new section 24C(2) to the 1993 Act.

Clause 2

A simplified approach to the drafting would avoid the need for most, perhaps even all, of the proposed consequential modifications in the Schedule to the Bill as referred to in clause 2 of the Bill.

Clause 3

It is good to see retrospective effect and application in the Bill given that the Crofting Commission’s staff were telling potentially affected parties that they had nothing to worry about because previously granted decrofting directions were granted in good faith and so would be valid. However, as one commentator on the Crofting Law Blog has pointed out the drafting of clause 3 could be clearer:-

That’s the sort of Sir Humphrey Appleby nonsense that gives the law and legislative process a bad name. Go ahead with this short bill in these terms now to correct the problem in the short term (so long as they’re SURE that gobbledygook actually does correct it) but only on the strict understanding a comprehensible bill to consolidate crofting legislation will be introduced asap.

[Neil King commenting on Crofting (Amendment) (Scotland) Bill Published at the Crofting Law Blog]

I would tend to agree and would have thought that a simple statement along the following lines would have sufficed:-

All decrofting directions granted by and applications made to the Commission in respect of applications to decroft made by owner-occupier crofters from 1 October 2011 until the coming into force of this Act are valid and enforceable.

Clauses 4, 5, 6 and 7

I have no particular comments to make on clauses 4, 5, 6 and 7 of the Bill.

Other Problems with the 2010 Act

There are other problems created by the 2010 Act which I will not go into in any great detail here but merely highlight:-

  • The 2010 Act did not provide for the purchase of a tenanted croft being a trigger that induces first registration in the Crofting Register.
  • Many issues and conflicts were created regarding owner-occupier crofters when compared with owner-occupiers (some have been referred to in these submissions but others exist that also      require a resolution).
  • No equivalent of sections 5(3)-(6) of the 1993 Act was provided for owner-occupier crofters creating difficulties for developments proposed on owner-occupied crofts and in particular wind farm developments.

There is a need for legislation to resolve these issues. It is appreciated that the Bill may not be the place to do so given the need for that particular legislation to be progressed with all due haste. However, the Scottish Government should give a commitment to introduce a further bill dealing with all of the other anomalies created by the 2010 Act as soon as possible following the Summer Recess.

Summary

My views on the Bill can be summarised as follows:-

  • The Bill as drafted is a sledge hammer to crack a nut and could be simplified in its drafting to a huge extent.
  • There appears to be attempts to introduce new law via the Bill. That should not be the purpose of the Bill which is to fix ‘flaws’ in the existing legislation created by the 2010 Act.
  • The problems associated with decrofting by owner-occupiers (as opposed to owner-occupier crofters) should also be addressed in the Bill.
  • A commitment should be given by the Scottish Government to introduce a Bill following the Summer Recess to deal with the various other anomalies in crofting law created by the 2010 Act.

Top Secret Crofting Law

Top secret crofting lawI requested the Crofting Commission to provide me with copies of the legal advice sought and obtained by them on the question of owner-occupied croft decrofting. They replied:-

“As you will be aware legal advice is exempt from disclosure under Section 36(1) of the Freedom of Information (Scotland) Act 2002 as legal professional privilege. We do not recognise that this is a qualified exemption and there can, in certain circumstances, be public interest arguments as to why legal advice should be released. In this case however we do not consider that the public interest outweighs legal confidentiality at this time, as both Ministers and officials are currently considering legislative remedies to resolve the situation.”

My request was to enable me to assist a crofter whose application to decroft has been put on hold by the Crofting Commission. The Crofting Commission has stated that such affected crofters should seek their own “independent legal advice as to possible remedies”. Yet the Crofting Commission are not explaining to crofting lawyers exactly how and why they have come to the conclusion that they have done on owner-occupied croft decrofting.

The Crofting Commission are expecting those affected by their decision and their advisers to operate in a vacuum where the rationale involved is an unknown quantity.

The legal advice obtained by the Crofting Commission relates to the interpretation of a very specific part of the Crofters (Scotland) Act 1993. It does not concern an actual situation or individual. It is not the subject matter of a dispute before the courts. Why then should it be privileged?

It does, however, affect (as Tavish Scott MSP pointed out in the recent debate at the Scottish Parliament arising from the motion by Jean Urquhart MSP to debate the role of Crofting in the Highlands & Islands) 3,000 owner-occupier crofters who may wish, at any time, to apply for a decrofting direction of the whole or part of their owner-occupied crofts.

Paul Wheelhouse MSP, has down played this statistic and considers instead the relevant one to be those only immediately affected, namely the 59 who have lodged decrofting applications that  have now been put on hold. However, the potential is there for it to affect many more especially the longer the saga is drawn out.

The recipients of the 179 decrofting directions granted since the new provisions contained in the Crofting Reform (Scotland) Act 2010 came into force should not be forgotten either. Surely if you accept the Crofting Commission’s argument that it does not have the power to grant those decrofting directions then they must be null and void. The knock on effect of this I have already looked at elsewhere, including the fact that title deeds could, in certain circumstances, also be null and void.

Anyway, the fact is that this does have widespread repercussions. There must also be a general public interest in the time and money being spent by public funded bodies (the Crofting Commission and the Scottish Government) on ruminating over, causing and resolving (if there was ever anything to resolve in the first place) the mess that has been created.

By publishing the legal advice crofting lawyers such as myself can assist the process by either putting forward legitimate arguments for why it may be wrong or endorsing it as correct. I have been contacted by several crofting lawyers in private practice who support my interpretation of the law. None have, so far, attempted to put forward a contrary view. I have asked the Crofting Commission to explain where I may have gone wrong in my interpretation. They have, so far, ignored the invitation to correct me.

I may well be wrong. If I and other crofting lawyers were given sight of the legal advice obtained by the Crofting Commission we may well see a point that I have been missing and concur with it. By keeping it top secret that opportunity will be lost.

Ultimately are we going to see much time and effort spent on emergency legislation that no one will ever know whether or not was necessary as the real reason for it will never be made public? Surely that cannot be in the public interest.

There is, in my opinion, no good reason for top secret crofting law unless, perhaps, you have something to hide.

Brian Inkster