1 The Business Condition

3.08 It is a pre-requisite of the creation of a farm business tenancy that all or part of the holding must be farmed in the course of a trade or business at the outset, and that some part must remain so farmed throughout the tenancy.¹⁸ The part of the holding farmed need not remain the same.

This basic requirement – the ‘business condition’ – will be satisfied as long as some part of the holding is farmed commercially at all times. The area farmed could therefore be changed from time to time without impugning the status of the tenancy. The rules concerning the application of either the agriculture condition or the notice conditions (considered below) are such that the character of the tenancy must be primarily agricultural at its commencement, but it can remain a farm business tenancy if it later ceases to be primarily agricultural in character, as long as some of the land remains in agricultural production. It should also be noted that, for the purpose of the business condition, it is not necessary that the tenant’s trade or business itself be farming. All that is required is that some part of the holding remains in agricultural production throughout the tenancy – and that it remain so in the course of ‘a’ trade or business.

3.09 If the business condition is satisfied, a farm business tenancy can be created in one of two ways: if the agriculture condition is satisfied or where the parties serve notices designating the tenancy a farm business tenancy, using the notice conditions laid down in the 1995 Act.¹⁹

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Source: Rodgers Christopher. Agricultural Law. Bloomsbury Publishing,2016. — 914 p.. 2016

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