Case B Non Agricultural Use
1Scope of Case B
7.61 Case B allows the landlord to serve notice to quit and seek repossession in two distinct situations: where planning permission has been obtained for non-agricultural development or land use, and where such permission is not required for the development envisaged.
There are two separate requirements for the application of Case B:•The land must be ‘required’ by the landlord or developer, and
•It must be required by him for a use ‘other than for agriculture’.
7.62 Whether the land is required raises two questions: an assessment of the landlord’s intention to carry out the proposed development, and whether it is necessary to terminate the tenancy to achieve that objective.
7.63 As to the first, the landlord must establish that there is a present intention to develop the land, and so (for instance) a mere intention to sell to an unidentified prospective developer will not suffice.144 The land does not have to be ‘required’, however, for the use of the landlord himself; the requirement of any person obtaining planning permission is included, whether he be the landlord, a prospective purchaser of the landlord’s reversion, or even a body intending to compulsorily purchase the landlord’s reversion.145 If, however, the landlord is intending to sell to a third party developer, the latter must be identified and establish a bona fide intention to develop the land with a reasonable prospect of doing so.146 This will be a question of fact in each case.
7.64 As to the second question, it is clear that Case B can be relied upon in cases where it is not necessary to terminate the lease in order to carry out the intended development. In Floyer-Acland v Osmond147 the landlord obtained planning permission to extract gravel and sand from tenanted land. He served a Case B notice to quit, and then, when the tenant served a counter notice challenging this, gave notice to re-enter relying upon the reservation of mines and minerals in the tenancy agreement.
It was held that he was entitled to pursue the notice to quit, as the land was ‘required’ within the meaning of the 1986 Act. What is necessary is that the land itself is required – it is not necessary for the statutory forfeiture procedure to be the only available avenue open to the landlord to gain possession. The fact that the landlord has alternative avenues available to him for obtaining possession does not rule out the use of Case B. Similarly, as long as the land is required for a non agricultural use (in this case gravel extraction), the anticipated use can be temporary. In the Floyer-Acland case the planning permission included an after care condition requiring the land to be put back into suitable use for cultivation and grazing in the future, once gravel extraction had finished. This did not invalidate the notice to quit. The court held, however, that if the intended use of the land involved concurrent agricultural and non-agricultural use then this would have been fatal to the notice to quit. Here it was not, as the agricultural use of the land repossessed was only to resume once gravel extraction had been completed.2Non-agricultural use with planning permission
7.65 Where Case B is invoked to facilitate redevelopment with planning permission, note that the latter must have been obtained after the tenancy was granted. Case B will not apply where planning permission was already in hand prior to the grant of the tenancy.148 Semble, however, assignment following a grant of planning permission will have no effect on the availability of Case B. Note also that permission must have been applied for and obtained; it will not suffice if the proposed user is sanctioned by the implied permission of the General Development Order currently in force, or by the Use Classes Order.149
7.66 Clearly, Case B gives the landlord considerable latitude to remove a tenant, without redress, where planning permission has been obtained. The tenant will be entitled to make representations in the deliberations on the planning application, but the fact that he is currently tenant of the land at issue and may lose his livelihood is only one material factor to be weighted in the planning process.150 An important check on the landlord’s power to use (or misuse) Case B was introduced in John v George.151 It was there held that a landlord can be estopped from relying on Case B if it would be inequitable (as between himself and the tenant) to allow him to do so on the facts.
The tenant had supported an application for planning consent to convert farm buildings, as part of a renovation scheme under which his dairy parlour was to be relocated in new premises. The landlord was subsequently estopped from relying on the planning consent to give notice to quit under Case B, because the scheme had not been fully carried out as agreed by landlord and tenant. The mere fact of obtaining planning permission will not, therefore, be enough in all cases: the court can look behind it and consider wider issues including, in particular, the manner in which it was obtained.7.67 Special considerations apply where planning permission is obtained by the National Coal Board to carry out opencast mining operations on what has hitherto been agricultural land. Case B does not apply where the Board obtained such planning permission subject to a restoration or aftercare condition in which the use specified is use for agriculture or forestry.
3Non-agricultural use – not requiring planning permission
7.68 Most notices served under Case B will follow the obtaining of planning permission for non-agricultural use. The second limb of Case B was hitherto of use chiefly to the Crown and government departments, who were exempt from planning control by reason of their identity, and not by virtue of the Town and Country Planning legislation itself.152 This will no longer generally be the case, however, as the Planning Acts now apply to the Crown, with necessary modifications and some exceptions, under the terms of s 79 of the Planning and Compulsory Purchase Act 2004.153
7.69 In Bell v McCubbin154 it was held that a landlord was able to invoke Case B to serve notice to quit the farmhouse on a holding, in circumstances where he proposed to continue its residential user by letting it himself. There being no envisaged change in the non-agricultural user of the property, planning permission was not required, thus bringing the case within the second limb of Case B.
The loophole in the security of tenure provisions exposed by Bell v McCubbin was potentially large. Whenever land or buildings were put to a non-agricultural use, the landlord would be able to repossess using Case B – provided, of course, that he proposed to put it to the same use himself, or to some use sufficiently similar not to constitute a ‘material’ change of use requiring planning permission. The decision undoubtedly undermined the position of tenants seeking to diversify into non-agricultural farm based businesses. The decision in Bell v McCubbin not only undermined the security of tenure provisions of the 1986 Act itself, it was also contrary to public policy as reflected in both European Community and domestic legislation, which now strongly encourages farmers to take land out of production and to diversify into alternative business uses.7.70 For these reasons the decision was reversed by the Agricultural Holdings (Amendment) Act 1990.155 The 1990 Act satisfied two objectives. Case B was recast to reverse the decision in Bell v McCubbin and restrict its availability to that previously supposed. A number of new provisions were added, however, to clarify the operation of Case B by providing for ‘the various ways in which Parliament may in Acts or Parliamentary orders not forming part of the general town and country planning legislation, remove the need for a planning application’.156 The remodelled Case B now provides that, in addition to the situation where planning permission has been granted on application, a landlord can also serve notice to quit in the following circumstances:
(i)Where land is required for a non-agricultural use for which planning permission is granted by a general development order by reason only of the fact that the use is authorised by either a private or local Act, an order approved by both Houses of Parliament, or an order made under ss 14 or 16 of the Harbours Act 1964. The provision to which this refers is currently Part I of Sch 2 to the 1995 General Development Permitted Order.
Part I gives what is, in essence, outline planning permission for development specifically authorised by a local or private Act, by a special procedure order, or by a harbour revision order made under ss 14 or 16 of the 1964 Act. The Part I permission does not authorise any building works, or the formation of means of access, unless the prior approval of detailed plans and specifications by the local planning authority has been obtained. The approval required is limited, however, to the siting of the development and the design and/or external appearance of buildings and other structures.(ii)Where land is required for a non-agricultural use that is deemed to have planning permission by any provision contained in an Act of Parliament, but which does not form part of the enactments relating to town and country planning.157
(iii)Where, similarly, land is required for a non-agricultural purpose which an Act, other than one forming part of the Town and Country Planning legislation, deems not to constitute ‘development’ and so does not require planning permission.
(iv)Where land is required for a non-agricultural use for which permission is not required under the town and country planning legislation, ‘by reason only of Crown immunity’. This provision put it beyond doubt that Case B is only available in cases where no planning permission has been acquired where this is unnecessary due to Crown exemption from planning control. It is therefore considerably narrower than the original Case B. Where the landlord wishes to repossess in order to perpetuate a non-agricultural use already being practised by the tenant, as in Bell v McCubbin, he cannot use Case B. He will, instead, have to serve an unqualified notice to quit and (if required) seek tribunal consent to its operation – an altogether more difficult proposition, as a tribunal cannot give consent if it appears to them that a fair and reasonable landlord would not, in the circumstances, insist on possession.158 This provision therefore restored the status quo ante, limiting Case B to its previously understood scope, viz.
the situation originally epitomised by Ministry of Agriculture, Fisheries and Food v Jenkins (above para 7.64). Following the extension of planning control to the Crown by the Planning and Compulsory Purchase Act 2004, however, its potential scope is extremely limited.4Arbitration on Notice to Quit
7.71 The tenant can challenge a notice to quit given under Case B by serving a written notice within one month of service of the notice to quit, requiring any of the reasons stated in the notice to quit to be submitted to arbitration.159 In this way, for instance, he can challenge whether the land concerned is really required for the non-agricultural use proposed. If: (a) he fails to require arbitration within one month; or (b) if an arbitrator is not appointed, or an application for the appointment of an arbitrator is not made, within three months after the date of service of his notice requiring arbitration, then the tenant will lose his right to challenge the grounds on which the notice is given.160