The Scottish Land Court has issued a judgment to this effect. The case was a farmer’s application for the court to approve works undertaken to an agricultural holding, so that on the eventual end of his lease he could claim payment for their value.

Duncan Black is the tenant of Woodmill Farm in Fife, owned by the Falkland Trustees. Until 2003 he was a general partner in a limited partnership which held an agricultural tenancy of the farm. In 2003 that was superseded by a new limited-duration tenancy to him as an individual. Before 2003 the limited partnership had undertaken work on the holding, such as drainage improvements. Drainage works can attract a right to payment of compensation by the landlord: Part II of Sched. 5 to the Agricultural Holdings (Scotland) Act 1991. The compensation is payable at the eventual end of the tenancy.

Where the same tenant remains in occupation under successive leases of the same subjects, he can claim compensation at the end of his final lease for improvements which he undertook under an earlier lease: Agricultural Holdings (Scotland) Act 2003, section 45(4).

Normally it is a necessary condition that the tenant has given the landlord advance notice of such work. However, the Land Reform (Scotland) Act 2016 provided that for a limited period of time, from 2017 until 2020, agricultural tenants could validly give late, retrospective notice of historic improvements. If the landlord did not agree that they should be eligible for compensation, then the tenant could apply to the Land Court for their approval.

Mr Black sought retrospective approval for about 170 improvements at Woodmill, most of which were agreed by the landlords. However, his claim included the work undertaken when the limited partnership had been the tenant. The Land Court held that, while he had remained in occupation under the new lease which had been granted to him personally, for the purpose of section 45(4) he was not the same tenant as the previous limited partnership in which he had been a partner.

The tenant argued that, regardless of that interpretation of section 45(4), correspondence with the landlords at the time of the replacement of the limited-partnership lease by his new personal tenancy had justified him in reasonably believing that he would be treated as standing in the shoes of the partnership for the purpose of compensation, and that he had then acted to his prejudice by not seeking more specific provision to that effect.

The Land Court agreed with the tenant’s account of the facts. However, it held that “where the applicant’s reliance on personal bar breaks down is that the doctrine operates as a shield and not a sword. It does not create rights; it merely modifies the rights another person might have. In this case it would operate to prevent the respondents resisting his claim but it would not confer upon him a right which the law does not otherwise recognise; the right to compensation for improvements made under a tenancy in which he was not the tenant. Reference is made … particularly to what was said by Lord Hodge in Shaw v. James Scott & Co. Ltd. [2010] CSOH 68 at para. [64]”.

Accordingly the disputed elements of the tenant’s application were refused.

(The provision for late notification in 2017-2020 is referred to by the legislation as an “amnesty”, as though the tenants had committed wrongs which might be forgiven, but in ordinary English it was a dispensation or relaxation of a time limit.)

Robert Sutherland, advocate, and Burness Paull represented the tenant; Michael Upton, advocate, and Anderson Strathern represented the landlords.