United Kingdom House of Lords Decisions

Subject_Provisional Order — Procedure — Locus — Objection by Lessees — Notice by Lessor Terminating Lease — Provision in Order that Lessees' Rights should be Unaltered during Currency of Lease. Headnote:

The Burgh of Bridge of Allan promoted this Order for power (1) to extend and improve the water-works of the burgh, (2) to do away with certain preferential rights to a supply of water which had been conceded in 1866, and (3) to acquire certain mineral wells in the burgh, and to carry on or lease the undertaking already existing in connection therewith. Petitions against the Order were lodged, but ultimately agreement was reached with all the petitioners other than W. & A. W. Henderson, Limited.

W. & A. W. Henderson, Limited, were tenants of Airthrey Paper Mills, which drew their supply of water, inter alia, from a three-inch pipe from the burgh water supply—one of the preferential rights which it was proposed to end. Agreement had been reached with the proprietrix as to the terms on which the right was to be terminated, and the proprietrix had given notice to the tenants that their lease of the mills would determine at a break on 28th May 1924. One of the conditions of the agreement with the proprietrix was that this preferential right should be continued unaltered until that date.

W. & A. W. Henderson, Limited, claimed compensation from the promoters on the ground that they had expended large sums of money in developing their plant and equipment with the intention of transferring the business, if necessary, at the end of their lease as a going concern. The ending of the preferential right to draw water would make it impossible to sell as a going concern, and in the circumstances give them at the end of the lease merely scrap value for all the machinery. They claimed as compensation the estimated difference between the value as a going concern and the scrap value.

The Commission were of opinion that these petitioners had no locus, the question raised being one between them and the lessor alone.