Estate owners’ plans for national film studio scuppered by Land Court ruling on resumption

An estate owner who was seeking to end a lease and remove a tenant farmer from land earmarked for Scotland’s national film studio has had his application rejected.

 

The Scottish Land Court refused to authorise the resumption of two smallholdings at Pentland Mains, Midlothian, which were to have been the site of the new studio, a project described by the Scottish Government in 2017 as being “of national importance”.

 

The holdings, known as No. 1 and No. 2 Pentland Mains, are part of the Pentland Estate, owned by the Trustees of the Miss J M H Gibsone of Pentland’s Trust, and, together extending to 56.30 acres, they form over half the area of the estate.  

 

The only people living on the estate are the respondent James Telfer and his family.  

 

The holdings, which are actively farmed, have been in the possession of the Telfer family almost continuously since their creation in 1915.

 

Apart from providing a site for the national film studio, a major driver of the resumption application from the point of view of the present owners was that it offered the prospect of solving a major problem afflicting part of the estate known as Clippens Yards, which has been the subject of enforcement notices from Midlothian Council for the removal of tens of thousands of tons of material amassed there by a tenant who was running a waste disposal operation but abandoned the site leaving the owners to face the consequences, and has since died.  

 

As well as providing a site for the national film studio, the deal struck by the owners with the developers makes provision for the restoration of this part of the estate, which is estimated to cost in excess of £1 million.

 

That deal involves the sale of the whole estate by its present owners to a company called Clippens Developments Limited and a simultaneous sale by them of the part to be used as the film studio to a company called PSL Land Ltd. 

 

In terms of missives concluded between these various parties, liability for clearing Clippens Yards would transfer from the present owners to Clippens Developments Ltd and be financed by them from the proceeds of sale to PSL Land Limited.  

 

The issue in the case was whether resumption of the holdings could be said to be a reasonable purpose “having relation to the good of the estate”, as That is because, resumption of land from crofts and from smallholdings requires the consent of the Land Court under section 2 of the Crofters Holdings (Scotland) Act 1886.

 

Consent can only be given, in the case of smallholdings (but not crofts), where the purpose of the resumption has “relation to the good of the holding or of the estate”.  

 

However, extinguishing the holdings, which would be the effect of the film studio development in this case, would not be something “having relation to the good of the holding”, so the question was whether the resumption related to the good of the estate. 

 

An amendment introduced by the Crofters (Scotland) Act 1955 provided for “public interest” as a criterion for resumption applies only to crofts, not smallholdings.

 

The court held that, despite its potential to cure the problems of one part of the estate and relieve the owners of very onerous responsibilities under enforcement notices served by Midlothian Council in relation to Clippens Yards, as a matter of law the purpose of resumption had to benefit more than the owners of the estate, present or future, and, in particular, had to benefit residents on the estate, however indirectly, incidentally or, even, minimally. 

 

Since, far from benefiting the only residents on the estate, resumption would lead to their removal - albeit compensated, but against their will - it could not be said that the purpose of resumption had relation to the good of the estate.

 

The “true purpose” of the resumption was to enable the estate to be sold with vacant possession for the purpose of building a film studio, with the only beneficiaries - in terms of anyone having to do with the estate - being the applicants, Clippens and PSLL.

 

In a written judgment, chairman of the Land Court Lord Minginish said: “Our decision is, therefore, that the application should be refused for want of a reasonable purpose in relation to the good of the estate. We recognise that deciding the case in such a way that a project said to be of national importance does not go ahead is a serious matter. 

 

“However this is not the only place in Scotland on which such a development can take place. The applicants’ pleadings tell us that 28 sites were considered (by whom is not clear), then the list shortened to two, of which the Pentland site was preferred.

 

“We also acknowledge that a huge amount of work, with no doubt commensurate expense, has been invested in taking the project this far, no doubt partly because of this court’s insistence on being satisfied that there is a reasonable likelihood of the stated purpose of resumption going ahead… But the court’s assessment of reasonable purpose cannot be circumscribed or restricted by awareness of such investment.”

 

Had there been a “public interest” criterion in section 2, that would have been a “different matter”. 

 

The chairman added: “The project obviously has considerable potential to bring employment and all sorts of economic activity in its wake. But there is no such criterion and we have had to decide the case on our understanding of the law as it stands.

 

“We also sympathise with the landlords who will continue to be liable for the remediation of Clippens Yards with no means of discharging that liability. They are in an impossibly difficult position but it is not apparent that the removal of a tenant on a secure tenancy from his holdings is a reasonable answer to that difficulty.”