Council granted interdict against sale of farm it previously conveyed by feu disposition

A local authority has been granted an interdict against the sale of a farm in West Calder on the basis that a right of pre-emption contained in a feu disposition had survived the abolition of feudal tenure in Scotland.

West Lothian Council raised the action against the executors of George Clark, namely his son Thomas Clark and Turcan Connell (Trustees) Ltd, who sought to sell the farm on the open market. The pursuers argued that the defenders had not complied with the formal requirements of the contract.

The case was heard in Livingston Sheriff Court by Sheriff Douglas Kinloch.

Required notice

The property, West Muir Farm, was disponed by the pursuers’ predecessor, Lothian Regional Council, to George Clark in 1985 by means of feu disposition. The disposition contained a right of pre-emption in favour of Lothian Regional Council, which was transferred to the pursuers by succession under the Local Government (Scotland) Act 1994 following local government reorganisation.

The clause allowed the council to buy back the land at agricultural land values in the event of Mr Clark seeking to sell the land at a later date, creating a real burden with LRC as the feudal superiors and Mr Clark as the feuar. The feuar was required to inform the superior if they planned to sell the land.

Mr Clark died on 23 November 2011. By that time, the Abolition of Feudal Tenure etc (Scotland) Act 2000 had abolished the feudal system in Scotland. West Lothian Council never registered a statutory notice to convert the feudal right of pre-emption over the land into a personal right as per the Title Conditions (Scotland) Act 2003.

In December 2015 the defenders’ solicitors wrote to the pursuers to say that they planned to dispose of parts of the feu, which were to be indicated as red and brown areas on an attached map. A solicitor for the pursuers replied within the time limit querying where the brown area was, as it was not visible on the map. No clarification was provided by the defenders.

Following the expiration of the contractual time limit for replies, the executors came to the view that they were entitled to sell the land, and wrote to the pursuers to state that their letter did not state that the council wished to buy back the land and thus the right of pre-emption had terminated. In their reply, the pursuers stated that they were entitled to know which areas of land the defenders wished to sell, and by not providing clarification and allowing the time limit to expire they had not met their obligations under the disposition.

At debate before a different sheriff, the defenders argued that the pre-emption clause had ceased to exist due to the council’s failure to record a notice under the 2003 Act. The pursuers argued that, even though the feudal right no longer existed, there was still an enforceable contractual right of pre-emption against Mr Clark that was created at the same time as the feudal real burden.

The sheriff who heard the debate was persuaded by the pursuers’ arguments, found they had title to sue on the basis that the right of pre-emption was a contractual right and not a feudal right, and allowed a proof before answer. At the proof, the defenders did not accept the proposition that there was a contractual right of pre-emption and contended that if there was one it had come to an end on the abolition of feudal landholding.

A matter of law

In his decision, Sheriff Kinloch first addressed the existence of a contractual right of pre-emption, saying: “I do not in fact regard the evidence which I heard as offering any assistance as to whether such a right exists. It is my view that the question is properly answered as a matter of law, and is not a matter of fact which is dependent on the evidence.”

He continued: “Contrary to the Defenders’ submissions, it appears to be long established that a feu disposition is also a contractual document. Thus, in the well-regarded textbook Conveyancing by Professors Gretton and Reid it is said as follows: ‘As well as being an executory deed, conveying of the land (and the writs and rents), a disposition is also a contract imposing obligations, usually on the granter but sometimes on the grantee.’”

He concluded on this matter: “Although the precise circumstances of any case are always relevant, I do not believe that it would have been possible to lead any evidence which would have been relevant to the question of whether the feu disposition created a contractual right of pre-emption. The contract came into being in this case essentially as a matter of law.”

On the validity of the notice given by the defenders, he said: “Having examined the plan myself, there is in my view simply no brown area visible to the naked eye. Even if I am wrong as to the competency of me using my own senses to look at the plan, it is my view that the evidence of three of the witnesses led for the Pursuers clearly established that there was no brown area visible.”

He continued: “[The pursuers] needed to know precisely what land was being offered back to them before they could decide whether or not to purchase it. It is accordingly clear to me that the purported notice given by the executors was not a valid notice at all, and I am made even more certain in that conclusion by the fact that in law strict compliance with the terms of the pre-emption notice was required.”

For these reasons, Sheriff Kinloch granted an interdict preventing the sale of the land, and issued declarator that the defenders were bound by the pre-emption right.