HC Deb 13 March 1931 vol 249 cc1626-30

Where a landholder has given notice of renunciation of his tenancy and such notice has become effective in terms of section seven of the Act of 1886, as amended by section eighteen of the Act of 1911, it shall be competent for the Land Court, on the joint application of the landholder and the landlord or, where the landholder's rights to compensation for permanent improvements have been transferred in whole or in part to the Department under section eight of the Act of 1911, on the joint application of the Department and the landlord, to assess, prior to the renunciation, the amount which will become due by the landlord, on renunciation, in respect of compensation for permanent improvements under section eight of the Act of 1886, and the amount so assessed shall, on renunciation, become due accordingly.—[Mr. T. Johnston.]

Brought up, and read the first time.

The UNDER-SECRETARY of STATE for SCOTLAND (Mr. T. Johnston)

I beg to move, "That the Clause be read a Second time."

Here again all parties are pretty nearly agreed in principle, and the only difference between us appears to be that the right hon. Members opposite would desire that notice should be given not later than three months prior to the renuncia- tion. About that there are difficulties which I shall indicate very briefly. A year's notice of renunciation is required now by law. It cannot be effective until two months thereafter. But immediately that happens in other words ten months before the actual termination of the tenancy, the Land Court, on the joint application of landlord and landholder, can determine the amount of compensation. That might therefore be done more than three months before the termination of the tenancy, in which case—it is an extreme case I admit—the Amendment to the proposed new Clause would have the absurd result of requiring the landholder to give intimation to the landlord months after the claim in process between the parties had been settled. I am certain that no interest is prejudicially effected by the proposed new Clause and, as all parties are agreed upon it in principle, I trust that the House will give it a Second Reading.

Sir F. THOMSON

I beg to move, in line 3, after "1911" to insert the words: he shall intimate any claim in respect of compensation for permanent improvements under section eight of the Act of 1886 to the landlord not less than three months before the expiry of the tenancy and. It is true that the new Clause as it appears on the Paper is an improvement and carries out a suggestion made by the Nairne Committee that compensation might be assessed before the renunciation of tenancy. The tenant has to give a year's notice of renunciation, but the procedure set forth in the Government's new clause depends on the joint application of the landholder and the landlord, and it was in reference to the difficulty which would arise where there was no joint application, where the landholder did not concur with the landlord in making the application, that the Nairne Committee drew attention to the matter. The difficulty which arises is that, where no claim for compensation is made until the period of renunciation, or even afterwards, the landlord does not know what terms to offer to the incoming tenant. He does not know the compensation which he may have to pay to the outgoing tenant or what he may have to ask the incoming tenant to pay in respect of buildings. He is kept in the dark and the Nairne Committee pointed out that this was prejudicial and had led to holdings being left vacant. The Clause, as it stands, lays down an excellent procedure where there is agreement between the landholder and the landlord, but in a case where a slack landholder makes no claim until the end of the tenancy or afterwards, a practical difficulty will arise to meet which our Amendment is intended.

Major ELLIOT

I beg to second the Amendment.

Mr. SCOTT

On behalf of my colleagues and myself, I wish to say that we accept the proposed new Clause as it stands and oppose the Amendment for the reasons which have been quite ably stated by the Under-Secretary. I would make a present to the Government of one technical point of terminology, namely, that the reference in the new Clause to "section eight of the Act of 1886," should be "section eight, Sub-section (1)" in order to be more precise.

Mr. JOHNSTON

The hon. Member was good enough to draw my attention to that point before. We have taken legal advice and we are informed that the present wording is sufficient.

Mr. R. W. SMITH

I ask the Government to accept this Amendment which merely provides that a reasonable amount of time should be allowed to the landlord. I draw attention to a statement made by the Under-Secretary during the Committee stage of the Bill. The Amendment before the Committee was to leave out Sub-section (2), which reads: Any claim by a landholder under this section shall be intimated to the landlord not less than three months before the expiry of the tenancy. In dealing with that Amendment the Under-Secretary of State said: The intention, of course, is suite right, but the wording is wrong, and if it would meet with the convenience of the Committee, we will between now and the Report Stage be glad to discuss the matter."—[OFFICIAL REPORT (Standing Committee on Scottish Bills), 17th December, 1930; col. 141.] It will be seen that the Government practically admitted our contention that it was only reasonable that the landlord should have a certain length of time, and all that we say in the Amendment is that it must not be less than three months before the expiry of the tenancy in order to be in time.

Mr. SKELTON

I am sure the Government must realise the importance from a practical point, of view of the landlord knowing what the sum of compensation is going to be before the landholder's tenancy comes to an end, and that seems to me, in spite of the extreme case put by the Under-Secretary of State, to be a substantial and practical reason for saying that the landlord should know before the tenancy ends what the liabilities will be, on himself in the first place and on the incoming tenant—I use that word roughly—in the second place. As to whether the claim should be made three months, two months, or one month before the renunciation seems to me personally to be a matter of comparatively small importance, so long as there is some substantial time allowed, but surely the Under-Secretary of State might be able to say that it would be possible to clear this matter up and to make it certain that the landlord would know fully what the compensation is before the renunciation. If three months is too long a time, perhaps a shorter period might be put in.

Sir F. THOMSON

We feel that there is a substantial point here, which we would like to have considered in another place. The new Clause does not meet the really practical point, and although we do not wish to press the matter to a division, as we do not want to delay the Bill, we do ask for very careful consideration of the point.

Mr. JOHNSTON

We quite appreciate the point put by the hon. and learned Member, and we discussed the matter upstairs, but we cannot deal with it in the way suggested without causing very serious difficulties and inconvenience, not only to the tenant but to the landlord, and it is because we have not hitherto been able to meet the point by a form of words that we felt compelled to put down the clause as we have done. If the hon. and learned Gentleman and his friends can devise to us, or assist us in getting, a form of words which will meet the point that they desire to meet, but will not create the absurd anomalies which I have indicated, we shall be glad to consider it.

Sir F. THOMSON

With that assurance, I ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.