A proposed draft remedial order which seeks to amend the Agricultural Holdings (Scotland) Act 2003 after the Supreme Court ruled that a provision in the Act was incompatible with the European Convention on Human Rights (ECHR), has been supported by the Rural Affairs Committee.
Although the original Act had been passed in good faith, MSPs on the Committee expressed their regret that a defect has been identified in the 2003 Act which may result in distressing consequences for some of those affected.
The proposed draft order seeks to give landlords affected by the defect a route back to vacant possession of their land.
Convener of the Rural Affairs, Climate Change and Environment Committee, Rob Gibson MSP said:
“The Committee recognises the need for this proposed draft order and believes, as did the vast majority of those who submitted evidence, that it does, broadly speaking, achieve the outcome required. During our evidence, the Committee heard that a number of people may be financially or personally disadvantaged as a result of the defect coming to light and this necessary correcting order coming into force and this is a matter of regret for the Committee.”
“It is therefore clear that mediation will be vital in trying to bring landlords, tenants, and possibly the Scottish Government, together to get a fair outcome for all involved and avoid lengthy and potentially costly litigation. Similarly the issue of compensation for some of those disadvantaged must be considered and it is positive that this has been recognised by the Scottish Government.”
In its report to Parliament, the Committee gives the following Executive Summary of its findings:
- The Committee regrets that an Act passed in 2003 by the Scottish Parliament has been found by the Supreme Court to contain a provision which is not compatible with the European Convention on Human Rights (ECHR). Though the Act was passed by the Parliament in good faith, and with the best intentions, rectifying the defect that has been identified in the 2003 Act may have distressing consequences for some of those affected.
- The Committee acknowledges the need for the proposed draft order, and reflects that the evidence it received also acknowledges the need for a correcting order. Furthermore, the Committee believes, as did the vast majority of those who submitted evidence, that the proposed draft order does, broadly speaking, achieve the outcome required of the Scottish Parliament (guided by the Scottish Government) by the Supreme Court.
- The Committee also recognises the work carried out by the Scottish Government, and member organisations such as the Scottish Tenant Farmers Association, National Farmers Union of Scotland, and Scottish Land and Estates, to identify those individuals and farms potentially affected by the defect. The Committee welcomes efforts made by the Scottish Government to identify the different groups of people affected by the defect, and to tailor the remedy for those groups to their particular circumstances, but is aware that there may be cases yet to be identified and therefore recommends that the Scottish Government and all relevant membership organisations do all they can to continue to identify potentially affected farms.
- The Committee is broadly satisfied that the order proposes a legal remedy for three of the five groups identified, and is pleased to note that those in groups 4 and 5, whose cases are deemed to have moved outwith the scope of the order, will have access to mediation services.
- The Committee has carefully considered the different routes to the same outcome for those in groups 1-3 proposed in the draft order to give a view on whether they appear to be fair, balanced, and appropriate. The Committee is broadly of the view that the proposed draft order is appropriate in this regard, but asks the Scottish Government to consider and provide clarification on two issues
- whether a bilateral agreement which resulted in the tenant receiving a secure 1991 tenancy in good faith of both parties in the period affected by the defect could be challenged in the courts, and therefore that the tenancy could potentially be converted, or whether such a tenancy would not be considered a “relevant tenancy” as defined in the proposed draft order; and
- whether the wording of article 3 (as read with section 72A(1)), which deals with ongoing cases currently sisted (paused or suspended for an indefinite period of time) at the Scottish Land Court, is sufficiently unambiguous as to allow the court necessary flexibility but prevent any ruling which might be at odds with the Supreme Court’s judgement.
- The Committee believes that mediation will have a central role to play in trying to minimise any negative impacts of the proposed draft order, particularly on tenants, and therefore welcomes the Cabinet Secretary’s confirmation that the Scottish Government will fully fund and participate (where that is agreed by both parties) in mediation for anyone affected by the defect, which will be provided by independent professional mediation service providers.
- The Committee also believes that payment of compensation may be required for some of those with a valid case if they have suffered financial or personal loss as a consequence of the defect or the proposed draft order coming in to force. Whilst acknowledging that it is difficult for the Scottish Government to accept general liability for all those disadvantaged by this situation, the Committee believes that the Government must accept liability for anyone disadvantaged by the remedy put in place, and for any stress suffered by those involved. The Committee therefore welcomes the Cabinet Secretary’s helpful confirmation that compensation may be a valid outcome for some of those affected.
- The Committee recommends that the Scottish Government provides clarity on potential time bars and the application of, and restrictions associated with, the relevant legislation on this issue.
- Finally, the Committee welcomes the Cabinet Secretary’s clarification that for any claim against the Scottish Government brought forward by groups covered by the proposed draft order, and where mediation has been entered into, any time bar period will not be treated as having started until the end of the mediation period, or 28 November 2015, whichever date is earlier. However, the Committee asks the Scottish Government to confirm its position on potential claims made against the Scottish Government by those in groups 4 and 5.
The proposed draft Agricultural Holdings (Scotland) Act 2003 Remedial Order 2014 was introduced after the Supreme Court found that a provision in the Agricultural Holdings (Scotland) Act 2003 was defective, in that it was not compliant with the European Convention on Human Rights.
It is expected that a final draft of the order will be laid in the Parliament in February/March 2014 and considered again by the Committee.