Scottish Court of Session Decisions

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Cite as: [1892] SLR 29_853, [1892] ScotLR 29_853

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SCOTTISH_SLR_Court_of_Session

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Court of Session Inner House First Division.

[Sheriff of the Lothians and Peebles.

Friday, July 8. 1892.

29 SLR 853

Robertson

v.

Ross & Company.

Subject_1Contract
Subject_2Agricultural Lease
Subject_3Claim by Tenant of Farm against Mineral Tenant for Severance Damage.
Facts:

In the lease of a farm the proprietor reserved full power to work the minerals, and to resume the land necessary for that purpose, subject to the condition that he should allow the tenant an abatement of rent in respect of any land resumed.

The proprietor subsequently let the minerals under the farm to tenants, to whom he assigned the rights and reservations contained in the agricultural lease, and he bound the mineral tenants to settle with the agricultural tenant for all ground taken from his farm according to the conditions of the agricultural lease. The mineral tenants having taken ground from the farm for the construction of a railway, held that the agriculturaltenanthad no claim against them for severance damage, in respect that the rate of compensation to be paid for land taken in connection with the mineral workings was fixed by his lease.

Opinion by the Lord President that a claim of severance damage is truly a claim for part of the value of the ground taken, namely, its value as an access to the adjoining lands. Doubt expressed on this point by Lord M'Laren.

Headnote:

By lease dated in 1876 the Earl of Hopetoun let to William Robertson the farm of Gateside, in the county of Linlithgow, for a period of nineteen years from Martinmas 1871. The lease contained the following clause—“Reserving always to the proprietor, his heirs and assignees, from the subjects hereby let, as follows, videlicet—Reserving always the whole mines, metals, minerals, and fossils, coal, marl, clay, gravel, sand, sandstone, limestone, and slate quarries on the subjects hereby let, with full power to search for, work, win, smelt, burn, and manufacture, and to carry off the same, and sink pits, form levels, make roads, railroads, canals, erect buildings and machinery, and carry on all works within the subjects hereby let which they may think proper, and to resume the land they may think necessary for these purposes: Reserving also full power at all times to take off land from any part or parts of the subjects hereby let for the purpose of planting, or for the purposes of feuing, or letting on building leases, or for making, altering, or widening roads, or for making railroads or canals, or pieces of water: Declaring that the proprietor, or his aforesaids, shall be bound always to keep enclosed properly any lands resumed for any
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of these purposes, and that the said tenant shall receive for any land so resumed an abatement from the rent in the proportion that the extent of ground resumed bears to the extent of the whole subjects hereby let; and also shall receive payment of the value of any crop which may be growing on, or unexhausted manure in, the ground when resumed, as the same shall be ascertained by arbitration.”

By lease dated in 1884 the Earl of Hopetoun let to James Ross & Company the minerals in parts of the estate of Hopetoun, including those lying under the farm of Gateside. This lease contained the following clauses—“And in addition to making payment of the aforesaid rent or lordships the said tenants bind and oblige themselves also to pay for all surface and other damages of every description occasioned at any time by their operations during the currency of this lease, including all damage occasioned to the crops on the lands hereby let through their workman trespassing (but declaring that such trespass damage shall only be payable by the tenants under this lease when specially approved of or directed by the said proprietor), and all other damages done by them, of whatever kind or nature soever the same may be, and whether such damages shall be due to the said proprietor or his foresaids, or to tenants of other proprietors, or to other parties, according as the value and damages shall be ascertained by arbitration as after-mentioned, with interest at 5 per centum per annum during not-payment. And also to pay and settle with the agricultural tenants of the said proprietor for all ground taken possession of from their farms, according to the conditions stipulated in the leases of their farms for ground to be resumed, and (in addition to paying the same rent per acre as they pay to the said proprietor, according to the average rent of their farms) to pay to the said agricultural tenants at the rate of £1 per acre per annum during their leases, and to pay them for all other damages which they can claim under their said leases: …And the proprietor hereby assigns and makes over to the tenants under this lease all rights, reservations, and conditions as to working minerals contained in the agricultural leases of the lands hereby let.”

In 1889 and 1890 James Ross & Company took possession of certain portions of the farm of Gateside, upon which they made bores or pits, and they also constructed a railway across several of the fields belonging to the farm.

In October 1891 Robertson, the tenant of the farm, brought an action against Ross & Company for payment of £120, the greater part of this claim being for severance damage.

The defenders pleaded, inter alia—(3) That they were only liable for the amount of compensation payable under the leases.

On 27th November the Sheriff-Substitute ( Melville) repelled the plea-in-law for the defenders, and allowed the parties a proof of their averments, and, on an appeal by the defenders, the Sheriff ( Blair) adhered so far as proof was allowed in regard to the claim of severance damage.

The parties thereafter lodged a joint-minute in which they agreed, without prejudice to their rights of appeal at any competent stage of the proceedings, that the sum payable to the pursuer in name of severance damage should be ascertained by remit to a man of skill, and in terms of a report so obtained the Sheriff-Substitute on 13th May 1892 decerned against the defenders for £31, 3s., and found them liable in expenses.

The defenders reclaimed, and argued—The pursuer's averments as to severance damages were irrelevant, and should not have been admitted to proof. The pursuer's rights were measured by his lease, and his lease having fixed a specified rate of compensation where land was taken for mineral workings, any claim for severance damage was excluded.

The pursuers argued—Apart from compact the pursuer had a good claim for severance damage founded on delict or quasi delict. His right being of a substantial nature could not be held to have been excluded by agreement, unless it were either expressly discharged or excluded by clear implication. There was no such express discharge or clearly implied exclusion of this right in his lease, and the clause fixing a rate of compensation for land resumed did not apply where the resumption was for mining purposes.

At advising—

Judgment:

Lord President—The pursuer in this case is the agricultural tenant of the farm of Gateside, in Linlithgowshire, the landlord being the Earl of Hopetoun, and he holds the farm under a nineteen years' lease from Martinmas 1874. A portion of the farm has been taken possession of by the defenders, who hold a lease from the Earl of Hopetoun of the minerals lying under the farm, and in so taking possession the defenders found their right upon their grant from Lord Hopetoun in their lease of the minerals, and on an assignation of the rights which he reserved in his lease with the pursuer. The mineral lease stipulates for a payment to the agricultural tenant of £1 per acre of resumed land which he would not have had under his own lease, and it is not disputed that he must get this. The question between the parties therefore falls to be determined by the terms of the agricultural lease primarily, because the defenders claim to have acted under the rights therein reserved to the landlord. In that lease the landlord reserved the whole mines and minerals, with full power to search for, work, win, and carry away the same, and to sink pits and make roads and railroads, “and to resume the land they may think necessary for these purposes.” That is the clause of reservation now founded on, and the present question is, whether the tenant is limited to recovering such payment only as is specified in the lease as the consideration which he is to receive for any land which may be resumed, or whether the tenant is entitled, in addition

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to such consideration, to a sum in name of severance damages. The answer made by the defenders—and it appears to me to be conclusive—is that the tenant is only entitled to the consideration specified in his lease, and inasmuch as the lease contains no stipulation for payment of severance damage, he cannot receive severance damage in addition thereto. Now, the view on which a claim of severance damage is based is, that in addition to the value of the land taken, something is due for the decreased value of the rest of the farm. But the scheme of the lease in question is to provide a rate of compensation for the resumption of land, and when we look at the reasons on which a claim of severance damage is based, we see that it is nothing else than a claim for the proper value of the land taken. That may be illustrated in this way—The occupant of a farm, when land is taken from him, is entitled to have the land taken valued as a part of the farm, and not as a separate subject. If the land taken is valuable not only for the crops it yields, but also as an access to the rest of the farm, then the value of such access is part of the aggregate value of that part of the farm, and is necessarily an important element in its value in addition to its agricultural value. Now, Mr Dundas said very frankly and properly, I think, that the words of the lease are substantially the same as if the stipulation was that the tenant was to receive the specified compensation for the resumption of land. That seems to me to settle the question, because the lease purports to give the whole consideration which the tenant is to receive for the land resumed, and therefore excludes any further recompense than the compensation which it provides shall be paid for the area taken.

In what I have said I have proceeded upon the assumption that the part of the clause which provides for compensation to the tenant applies to the act of resumption in question. As this was disputed, it may be right to say that I cannot accede to the suggested limitation of that part of the clause to the operations of planting, feuing, &c., and to the resumption necessary for these purposes. It appears to me to be quite clear that the clause beginning with the word “declaring” applies to resumption of land, which is incidental to mining as well as the other operations. In the first place, the language employed is of sufficient latitude to cover the operation of mining, and in the second, it is clear that the provision which binds the landlord to keep the land which may be resumed, properly enclosed, applies just as much to the case of resumption for the proposed mining, as for any of the other purposes named in the deed.

The Sheriff accordingly appears to me to have come to a wrong conclusion, and I think we should recal his interlocutor, sustain the third plea-in-law for the defenders, and give decree for the sum ascertained to represent the undisputed items as the whole amount to which the pursuer is entitled.

Lord Adam—Under the mineral lease the landlord granted to the defenders the powers reserved by him as to working minerals in the agriculture lease. Turning to the latter lease we find that the landlord reserved the whole minerals, with full power to work the same, to make pits, roads, and railroads, and to resume the land necessary for these purposes, and it was declared that the landlord should allow the tenant an abatement on his rent in proportion to the extent of ground resumed. I agree with your Lordship that that declaration clearly applied as much to the resumption of land for mining purposes as to the other purposes mentioned. What the landlord has to pay for under the conditions of the lease is the resumption of land, and this therefore being made matter of compensation, it appears to me that all claims of damages for the consequences of such resumption are excluded. On that ground I concur with your Lordship. But this does not altogether exhaust the case, for in the mineral lease the landlord assigns to the defenders “all rights, reservations, and conditions as to working minerals contained in the agricultural leases of the lands hereby let;” that is to say, the landlord puts the mineral tenants in the same position as he had held in all questions with the agricultural tenant. Therefore, unless the agricultural tenant can show that he had a claim against his landlord, he can have no claim against the defenders. It is difficult, indeed, to see what claim could be made at common law by the pursuers against the defenders, there being no privity of contract between them, and no wrong done by the defenders. But under the mineral lease the agricultural tenant gets more than under the ordinary lease to the extent of £1 per annum for every acre of ground resumed. If it were not for that clause I do not see what claim the pursuer could have had against the defenders under his own lease.

Lord M'Laren—I understand that the only question which we are called upon to decide is, whether the pursuer is entitled to a sum in name of severance damage in addition to the abatement on his rent, and the other compensation to which he is entitled for the land taken. I agree that the provision in the agricultural lease with regard to compensation applies to the resumption of land by the mineral tenants as well as to the case of resumption by the landlord himself for the purposes enumerated in the clause immediately preceding the clause of compensation, and that therefore the pursuer is only entitled to the compensation stipulated for under his lease, and the additional compensation which the defenders are bound to pay under their lease. I must say, however, that I have grave doubts whether a claim of severance damage should be considered as a claim for part of the value of the land taken, or whether it should not be regarded rather a claim of damages for injury done to the adjoining lands which suffer from the severance, and if the claim falls under

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the latter category the tenant might have a claim on the same ground as if injury were done by bringing down the surface or in some other similar way. However, after hearing your Lordship's views, I am not prepared to differ. I think it is a perfectly admissible view that the sum to be allowed to the tenant in this case includes all claims whatever either against the landlord or his assignees the mineral tenants. It is difficult to believe that a tenant would have agreed to a railway being constructed across his farm merely on receiving an abatement on his rent, nevertheless that the tenant did so agree in this case seems to to be the fairest and truest reading of the clause. We are bound accordingly to give effect to the clause, and to consider the claim of severance damage as included in the stipulated compensation.

Lord Kinnear concurred.

The Court recalled the interlocutors of the Sheriff and Sheriff-Substitute since the date of closing the record, sustained the defenders' third plea-in-law, and of consent decerned against them for a specified sum as the amount for which they did not dispute liability.

Counsel:

Counsel for Pursuer— Dundas— Salvesen. Agent— Thomas Liddle, S.S.C.

Counsel for Defenders— H. Johnston— Wilson. Agent— G. Monro Thomson, W.S.
1892