Scottish Court of Session Decisions

The Small Landholders (Scotland) Act 1911 (1 and 2 Geo. V, cap. 49), sec. 42 (4), is quoted supra in rubric.

William Baird & Company, Limited, respondents and appellants, being dissatisfied with a decision of the Land Court in an application at the instance of William Clelland, Dalry, Ayrshire, applicant and respondent, for an order determining whether he was a landholder or a statutory small tenant, appealed by way of Special Case.

The Case stated—“1. Under the Small Landholders (Scotland) Acts 1886 to 1919 the said William Clelland applied to the Scottish Land Court on 9th April 1921 for an order determining whether he was a landholder or a statutory small tenant of the subjects specified in the schedule annexed to the application, and fixing a rent and period of endurance therefor. The subjects in question are situated at Carsehead, Dairy, Ayrshire, and consist of a house and stable (subsequently converted into a byre) and a field extending to 1·191 acres. It was not pleaded by the landlords that the subjects did not constitute a holding within the meaning of the statutes. It was not proved that the applicant or his predecessors in the same family had executed the greater part of the improvements, and consequently the applicant could not claim that he could establish any right to be declared a landholder. The question in the case therefore is whether the applicant has established his right to be declared a statutory small tenant. 2. The facts admitted or proved are as follows:—At 1st April 1912 the applicant was a yearly tenant of the subjects in question, holding the same on tacit relocation following upon a series of leases entered into between the proprietors and his father, who became tenant in 1869 and died in 1888. The endurance of the said leases was for seven years from the term of Candlemas as to the land, and from the term of Whitsunday as to the houses. The rent was payable at two terms in the year, Martinmas and Whitsunday, by equal portions, and otherwise the leases contained the usual clauses of an ordinary agricultural lease. The last lease ran for seven years from Candlemas and Whitsunday 1882, and the applicant's father died during its currency. The applicant has since remained in possession of the subjects. He has from a date prior to 1st April 1912 resided on and cultivated the holding. Subject to the decision of the question raised by the facts hereafter narrated, he fulfilled the requirements necessary to constitute him a statutory small tenant within the meaning of section 2 (iii) ( b) of the Small Landholders (Scotland) Act 1911. In January 1921 a meeting took place in the office of the appellants' company, at which Mr Brand, a director of the company, Mr Russell, the cashier, and the applicant were present. At this meeting it was explained to the applicant that on account of the necessities of their business the company might require possession of the subjects occupied by him at short notice, and that it was necessary that some new arrangement with regard to the tenancy should be made between him and the company. The arrangement proposed was that the applicant should become merely a seasonal tenant of the field, and that he should hold the house and stable or byre from month to month. At that meeting the applicant did not give his consent to this new arrangement, but he undertook to consider the matter. A few days afterwards Mr Russell sent for the applicant and asked him whether he was prepared to accept the company's terms. In the interval between the two meetings Mr Russell had typed out in the form of offer and acceptance the company's

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conditions and these were read over to the applicant, and they were there and then signed by him. They are dated 27th January 1921.… Before he signed the missives the applicant remarked that the grass and the monthly let of the house were of no use to him, but Mr Russell assured him that things would just go on as they had done before. At the date when the missives were signed both parties were in ignorance of the provisions of the Small Landholders Acts, and neither of them was aware that the applicant might have made a claim for continued possession as a statutory small tenant under the provisions of these statutes. Both, however, knew that they were making a material alteration upon the conditions of the tenancy as previously held by the applicant. No actings of any kind followed upon the missives, except that sometime in July 1921 the landlords altered the entries in the valuation roll so as to make them conform to the conditions of let specified in the missives. The application for an order to find the applicant a landholder or a statutory small tenant was lodged on 9th April 1921. 3. We heard evidence in the case at Kilmarnock on 10th November 1921, but before issuing a judgment we ordered a further hearing for the purpose of giving the parties an opportunity of producing any evidence which might be available on the question whether there had been any actings following upon the missives. No evidence prior to 9th April 1921 was produced, and we did not consider that the alteration of the valuation roll, which was made after the matter had become litigious, was of any effect. On the facts stated we were of opinion that under section 32 (4) of the Small Landholders (Scotland) Act 1911 the applicant was not barred from founding upon his yearly tenancy as constituted at 1st April 1912, but we held that as there could be no determination of the tenancy in the sense of the statute until Whitsunday 1922 we could not pronounce an effective order until that term was bypast. We accordingly pronounced an order finding that at the passing of the Small Landholders (Scotland) Act 1911 the applicant was a yearly tenant, and we continued the cause without prejudice to any pleas which might be competent to the parties in respect of anything that might transpire prior to Whitsunday 1922.… Subsequent to Whitsunday 1922 we gave the landlords an opportunity of stating any further pleas, but they intimated they had nothing to add to the contentions formerly advanced on their behalf. We accordingly on 12th July 1922 pronounced a final order finding that the applicant was a statutory small tenant, and renewed his tenancy for three years from Whitsunday 1922 at an agreed-on rent of £7, 4s. 6d.… 4. The appellants contend that from 2nd February 1921 the applicant possessed the said house and byre and field under and in virtue of the missives of let dated 27th January 1921, and that he was not entitled to be declared a statutory small tenant within the meaning of the Small Landholders (Scotland) Acts 1886 to 1919. 5. The applicant contends that having been a yearly tenant of the subjects in question, and having from 1st April 1912 resided on and cultivated the holding, he is notwithstanding any agreement to the contrary entitled to an order constituting him a statutory small tenant.”

The question of law submitted for the opinion of the Court was—“Whether, on the facts stated, the Land Court was entitled to find and declare that the applicant was a statutory small tenant within the meaning of the Small Landholders (Scotland) Acts 1886 to 1919?”

Argued for the appellants—This was a restrictive statute and should be construed in favour of freedom of contract. A provision against contracting-out was common in many statutes. Such provisions, however, struck at agreements excluding the privilege which the statutes conferred. In the present case there was no waiving of the statutory privilege. The tenant was only renouncing the tenancy, and the prohibition of the statute could not extend as far as this. All that was intended was to protect the right of the tenant as to renewal. Otherwise the statute would cut far deeper into contract rights than it was intended to go. It was impossible to say that there was an “agreement to the contrary” in the sense of the statute in the present case merely because the incidental effect as the result of a larger transaction was to destroy the tenant's right to renewal— Birnie v. Fraser, 19l3, 1 S.L.C.R. 94, and MacCallum v. Lindsay, 1919, 7 S.L.C.R. 82, were referred to.

Argued for the respondent—The agreement contained in the missives was void because the tenant was thereby deprived of his right as a statutory small tenant. The Act was a remedial Act and should be construed liberally. The applicant was thereby vested with the right to apply to the Land Court to determine the terms (the rent and the ish) of the renewal of the tenancy conferred upon him by the statute— Clyne v. Sharp's Trustees, 1913 S.C. 907, per Lord President Dunedin at p. 914, 50 S.L.R. 688. The tenant could not renounce his right to get his rent and tenancy fixed. That was the proper construction of the Act, and if the missives struck at the applicant's right to a continuation of the tenancy, the statute made the agreement null. An analogy was afforded by the case of Cathcart v. Chalmers, 1911 S.C. (H.L.) 38, 48 S.L.R. 457, where it was held that the clause in the agreement whereby the tenant was deprived of his right was void.

At advising—