5 Tribunal consent to operation of notice to quit
7.18 To obtain tribunal consent to the operation of a notice to quit, the landlord must establish two things:
(1)the tribunal must, in all cases, withhold consent if it is satisfied that ‘a fair and reasonable landlord would not insist on possession’ (s 27(2)).
This is a prerequisite to an order for possession in all cases; and(2)the tribunal must withhold consent unless they are satisfied that one or more of the grounds for consent specified in s 27(3) is made out. The ground(s) on which the landlord is relying must be specified in his application for tribunal consent.69 The tribunal cannot go outside the grounds therein stated, and grant consent on other grounds contained in s 27(3).
7.19 The consideration of the grounds for consent and the ‘fair and reasonable landlord’ requirement are separate matters and must be considered separately.70 In particular, when considering whether one of the grounds for possession is made out the tribunal must put out of mind any hardship that might be caused to the tenant if possession is ordered, as this can only be considered at the discretionary stage as a relevant factor influencing the ‘fair and reasonable landlord’ requirement.71
(a)The grounds for consent
7.20 These are contained in s 27(3) of the 1986 Act.
(i) Good Husbandry
7.21‘that the carrying out of the purpose for which the landlord proposes to terminate the tenancy is desirable in the interests of good husbandry as respects the land to which the notice relates, treated as a separate unit.’
7.22 This provision directs the tribunal to make a comparison between the efficiency of the regime obtaining under the tenant with that which will obtain if the tenancy is terminated. It is not sufficient to prove that the existing tenant is farming badly.72 The landlord must prove affirmatively that the land will be better farmed if possession is granted, and he will for this purpose have to produce a scheme or plan to show how he intends to improve the efficiency of the holding, farmed as a separate unit.73 The land must, however, be treated as a separate unit, and the tribunal cannot consider the desirability of amalgamation with other of the landlord’s land when assessing the landlord’s proposals for the disputed property.74
(ii) Sound Management
7.23‘that the carrying out of the purpose is desirable in the interests of sound management of the estate of which the land to which the notice relates forms part or which that land constitutes.’
7.24 In considering sound management, the tribunal is entitled to look not only at the land to which the notice to quit relates, but also other land making up the landlord’s estate.75 The phrase ‘sound management’ is not defined in the 1986 Act, and clearly envisages something wider than ‘good’ estate management (as defined by s 11 of the Agriculture Act 1947), which latter is largely concerned with the landlord/tenant relationship.
It involves a consideration, essentially, of the way the land itself is managed, and a comparison with the way it would be managed under the landlord’s proposals. It is, therefore, not sound estate management to put forward a plan to eliminate onerous financial terms in the lease by obtaining possession and reletting the land to the same (or another) tenant under a lease omitting the offending clauses.76 The landlord must put forward a concrete plan to prove that the land would be better managed and more efficiently farmed if amalgamated with the remainder of his estate. The extent to which environmental considerations can be taken into account is unclear, especially where environmentally beneficial management will reduce the holdings agricultural output or efficiency. It is suggested, however, that ‘sound’ management must encompass considerations of ‘sustainability’, and that a management plan with environmental elements aimed at achieving the long-term sustainability of agricultural production should be relevant. Examples would include reducing livestock stocking density to curb over-grazing, or reducing nitrate inputs in an arable enterprise. It will not be sufficient to seek possession in order to sell with vacant possession, for there will be no basis for the tribunal to assess the regime that will eventually replace the existing one at the property.77 A proposal to sell part of the land may suffice, however, where this is necessary to finance improvements in the management of the estate as a whole.(iii) Agricultural Research
7.25‘that the carrying out of the purpose is desirable for the purpose of agricultural research, education, experiment or demonstration, or for the purposes of the enactments relating to smallholdings.’
7.26 This ground enables the repossession of land for the establishment of public (or private) agricultural colleges or other research institutions, or to facilitate re-letting as a smallholding by a smallholdings authority, eg to entrants into agriculture.
(iv) Allotments
7.27‘that the carrying out of the purpose is desirable for the purposes of the enactments relating to allotments.78
‘that greater hardship would be caused by withholding than by giving consent to the operation of the notice.’
(v) Greater Hardship
7.28 The issue here is at large, and the tribunal can consider a wide variety of matters, provided always that they bear a causal relationship with the giving or refusing of tribunal consent.79 ‘Greater hardship’ can also be relevant in proceedings to recover possession of residential dwellings under the Rent Act 1977.80 In Purser v Bailey81 it was indicated that the tribunal should interpret ‘greater hardship’ in the same way as established Rent Act jurisprudence. Hardship not only to the landlord, but also to ‘all those concerned on the landlord’s side’ will therefore be relevant.82 The correct approach in Rent Act cases, and also it is suggested in the present context, was laid down in Harte v Frampton:83
‘the [tribunal] should take into account hardship to all who may be affected by the grant or refusal of an order for possession – relatives, dependants, lodgers, guests and the stranger within the gates – but should weigh such hardship with due regard to the status of the persons affected and their proximity to the landlord or tenant, and the extent to which consequently hardship to them would be hardship to him.’
7.29 Hardship to third parties can, then, be taken into account, provided they are in a close personal or family relationship to landlord or tenant. Hardship to the wife or child of either party will be of importance (as in Purser v Bailey, above).84 Hardship to a parent has also been held relevant,85 but hardship to more distant relatives will carry little weight unless the circumstances are exceptional.86 The effect of a decision to give or refuse consent on the health of either party has been held a relevant factor in Rent Act cases, although medical evidence as to the likely effect of the tribunal’s decision will require close scrutiny.87 In all cases the tribunal must weigh any perceived hardship against the closeness of the relationship of the person suffering it with landlord or tenant.
The proximity of relationship with either party will determine to what extent the hardship can truly be said to be caused by the tribunal’s decision to give or withhold consent.7.30 Although Rent Act jurisprudence is of assistance (if not strictly authority), the context dictates that in agricultural cases the financial consequences of giving or refusing possession will have much greater prominence than under the Rent Acts. The land in dispute may be of importance to the viability of the tenant’s business, or the landlord’s financial plight; the question is therefore wider than simply a consideration of hardship arising from the loss of one’s residence. Thus in Purser v Bailey (above) consent was given where the landlord had died leaving an insolvent estate, and sale with vacant possession was the only means of clearing its indebtedness. Hardship to the son (who had guaranteed the debts) and widow (who would receive no legacy) would ensue, and were relevant considerations dictating the giving of consent. It would appear, however, that the landlord’s ability to sell with vacant possession will only be decisive if there are strong grounds to suppose hardship will otherwise ensue (as here). Financial hardship to the tenant must also be considered, and will often outweigh that to the landlord eg because the loss of the holding may render the tenant’s agricultural enterprise, viewed as a whole, uneconomic. The availability of other land to the tenant will be an important factor, for if he has alternative land that in itself will support a viable agricultural business, he will have difficulty establishing that hardship will flow from the giving of tribunal consent.88
7.31 The exercise here involves balancing the relative hardship attributable to landlord and tenant from the giving or withholding of consent. Clearly, the underlying factors influencing issues of hardship will be subject to rapid change eg the parties’ respective financial positions. Accordingly, the landlord is at liberty to seek consent to successive notices to quit on the same ground, even though earlier applications have been refused.
Each application will be dealt with on its merits, and is not confined to material changes of circumstance which have intervened. The landlord runs the risk, however, of being penalised in costs if he alienates the tribunal by asking for what is, in substance, the same thing on successive occasions.89 Where the tenant has negotiated for the surrender of his interest, this may prejudice any claim that he would suffer hardship were possession to be given. Semble, negotiations will act to the tenant’s detriment even if conducted on a ‘without prejudice’ basis.907.32 It should be noted, finally, that even if the tribunal consider the balance of hardship to be in the landlord’s favour, they are entitled to refuse consent if satisfied that a ‘fair and reasonable’ landlord would not demand possession. They may still refuse consent if, for instance, they consider that the farming of the land would suffer if possession were granted.91
(vi) Non-Agricultural Use
7.33 ‘that the landlord proposes to terminate the tenancy for the purpose of the land’s being used for a use, other than for agriculture, not falling within Case B.’
7.34 Schedule 3, Case B relates to development for which planning permission is required, or for which otherwise than by virtue of the town and country planning legislation, no permission is required.92 The present provision, consequently, is confined to cases where the landlord’s proposals are exempted from planning permission by the terms of the Town and Country Planning Acts themselves, and are of a non-agricultural nature.93
(b)The ‘fair and reasonable landlord’
7.35 Even if one of the grounds for consent is made out, the tribunal must still refuse consent if they are satisfied, in all the circumstances, that a fair and reasonable landlord would not insist on possession. The question is at large, and the tribunal here comes into its own as a specialist arbiter of fact. The tribunal can consider issues of relative hardship to each party, irrespective of whether the ‘greater hardship’ ground (above) has been relied on.
They can, moreover, look to hardship factors of a wider kind than those permitted by s 27(3)(e), ie those not causally connected with the giving or withholding of consent. The long-term benefit of the land, and its productivity, will also be important factors for consideration. The tribunal may refuse consent if the long-term productivity of the land is likely to suffer, even if to do so would cause hardship to the landlord.94 On the other hand, the tribunal may refuse possession where the landlord has established grounds (a) or (b), if to do so would cause hardship to an otherwise competent tenant.95(c)Conditions on tribunal consent
7.36 Section 27(4) gives the tribunal power to impose appropriate conditions when granting consent, to ensure ‘that the land to which the notice to quit relates will be used for the purpose for which the landlord proposes to terminate the tenancy.’ If the landlord contravenes, or fails to comply with, a condition imposed by the tribunal, it can impose a penalty of not more than two years’ rent on the landlord.96 Action to enforce the condition, by way of tribunal application, can only be taken by the Crown. Any penalty levied on the landlord is treated as a debt due to the Crown, and is payable into the Consolidated Fund.97 The Tribunal can award costs in an application under s 27.98