HC Deb 04 July 1957 vol 572 cc1372-8

(1) The provisions of this section shall have effect in any case where property is affected by subsidence damage and—

  1. (a) a person who is a tenant for the purposes of Part I of the Landlord and Tenant Act, 1927, the Agricultural Holdings Act, 1948, or the Agricultural Holdings (Scotland) Act, 1949, a landholder for the purposes of the Small Landholders (Scotland) Acts, 1886 to 1931, or a crofter for the purposes of the Crofters (Scotland) Act, 1955, would have been entitled under any enactment contained in those Acts to remove that property or to be paid compensation in respect thereof by his landlord if his tenancy had terminated immediately before the damage occurred; and
  2. (b) apart from the provisions of this section, neither the person aforesaid nor any other person would be liable to make good the damage in whole or in part;
and in the following provisions of this section the expression "protected tenant" in relation to any property means the person who would have been entitled as aforesaid in respect of that property.

(2) Where the damaged property is property in respect of which the protected tenant would have been entitled to compensation as aforesaid, the protected tenant shall, subject to subsection (5) of this section, be treated for the purposes of this Act either—

  1. (a) as a person liable to make good the whole of the damage to the property; or
  2. (b) if by reason of any other enactment contained in the Acts aforesaid compensation in respect of the property would have been payable to him as aforesaid of less than the amount otherwise provided for by subsection (1) of section one on the said Act of 1927, section thirty-seven or 1373 section forty-eight of the said Act of 1948, section thirty-eight or subsection (1) of section forty-nine of the said Act of 1949, so much of section ten of the Crofters Holdings (Scotland) Act, 1886, as precedes the proviso thereto, or subsection (4) of section fourteen of the said Act of 1955, as the case may be, as a person liable to meet such part of the cost of making good the whole of the damage to the property as hears to the whole of that cost the same proportion that the compensation which would have been payable hears to the amount otherwise provided for as aforesaid:

Provided that, for the purposes of this section, there shall be deemed to be omitted from the said section ten the words from "and the value" onwards.

(3) Where any of the property consists of a building or structure which the protected tenant would have been entitled to remove as aforesaid, then, without prejudice to any liability of the Board in respect of damage to that building or structure, paragraph (c) of subsection (1) of section one of this Act shall have effect in relation to the site thereof as if that building or structure had not been erected.

(4) Any question arising under this section in relation to any property as to whether or not any person is a protected tenant or as to the amount of any compensation which would have been payable to him as aforesaid under any of the Acts aforesaid shall he determined in like manner as if it had arisen under the Act in question

(5) Where in the case of any damaged property it is claimed that a person who, apart from the provisions of this section, is neither the owner of, nor liable to make good in whole or in part the damage to, the property falls to be treated as so liable by virtue of this section, and a damage notice is served in respect of the property, whether by that or any other person, that person shall not be treated as liable as aforesaid unless—

  1. (a) either it is agreed between that person and the owner before the expiration of the period of one month from the first service of a damage notice in respect of the property, or it is determined in proceedings by virtue of the last foregoing subsection begun before the expiration of that period that that person is a protected tenant in relation to that property; and
  2. (b) notice in writing of that agreement or of the beginning of those proceedings has been given to the Board before the expiration of the said period;
and where the liability of the Board to comply with any requirement of this Act in consequence of the service of the damage notice depends on the determination of the question whether or not that person falls to be treated as liable as aforesaid, the Board shall not be required to comply with that requirement until it is established in accordance with the provisions of this subsection whether or not that person falls to be so treated.

(6) For the purposes of the last foregoing subsection, proceedings to determine by arbitration whether or not a person is a protected tenant by virtue of the said Act of 1948 or the said Act of 1949 shall be deemed to be begun when either an arbitrator or, as the case may he, an arbiter has been appointed by agreement between the owner and that person or an application for the appointment of an arbitrator or, as the case may he, an arbiter has been made to the Minister of Agriculture, Fisheries and Food or, as the case may be, to the Secretary of State by either the owner or that person.

(7) Subsection (1) of section eight of the Small Landholders (Scotland) Act, 1911, other than the provisos thereto, and subsection (3) of section twenty-three of the said Act of 1955 (which provide that the agreement for a loan by the Secretary of State to a landholder or, as the case may be, crofter shall effect a transfer to the Secretary of State of all rights of the landholder or crofter to compensation for permanent improvements) shall have effect as if the references therein to such compensation included references to any amount payable to the landholder or crofter by virtue of this section.—[Mr. Renton.]

Brought up, and read the First time.

The Parliamentary Secretary to the Ministry of Power (Mr. David Renton)

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

I should point out that this new Clause is not introduced as a result of anything which was mentioned in Committee. It is intended to fill a gap in the Bill and to cure what might be considered quite important defects.

As the House will remember there are many statutes dealing with landlord and tenant, the Agricultural Holdings Act, and various Scottish agricultural provisions, in which during their tenancies tenants may make improvements and at the end of their tenancies will be compensated by their landlords in respect of them, or may be entitled to remove the improvements if they are moveable. As the Bill stands at present, that does not fit in with the plan in the Bill because the general rule of the Bill is that compensation has to be payable either to the owner or to another person liable to make good the damage.

Tenants, of course, are not owners and the position in law is that if they make improvements no one is liable to make good the damage. We had to think afresh about this matter, more especially as two rather unfortunate results would have occurred if we had not done anything about it. First, the tenant would have no power to serve a damage notice if his improvement had been damaged and the value payments would have gone to the landlord and not to the tenant. That is the first unfortunate result. The second is that where a value payment had been made when the tenancy fell in the tenant would only get compensation for the improvement in its damaged condition. He would not, therefore, even get the benefit of the Landlord and Tenant Act and of the various other Statutes that I have mentioned.

The solution contained in this rather complicated provision of the new Clause is this. For the purpose of the Bill, the tenant shall be treated as a person liable to make good the damage to the improvement. Therefore, he is entitled to serve the damage notice, although otherwise he would not be liable to make good the damage. That is the simple solution, and I must apologise to the House for the fact that it has to be contained in such a very lengthy and such a very complicated Clause.

The difficulty, of course, is that we have to dovetail the procedure under the Bill with the procedure under those other numerous enactments, which include the Landlord and Tenant Act, 1927; the Agricultural Holdings Act, 1948; the Agricultural Holdings (Scotland) Act, 1949; the Small Landholders (Scotland) Acts, 1886 to 1931, and the Crofters (Scotland) Act, 1955.

Not all of those Statutes have the same procedure for assessing the compensation due to the tenant, or even for deciding disputes which arise with regard to it. We have to ensure that disputes which will arise in respect of this matter now being introduced into the present Bill are decided in a way consistent not only with the Bill but with the various Statutes that I have mentioned, and the different procedures that they have.

Perhaps I may just outline what we have done. I hope that the need for the first three subsections is plain from what I have already said. In subsection (4) we provide that any question as to whether or not a tenant is what we call, for the purpose of this Clause, "a protected tenant"—not to be confused with a protected tenant under the Rent Acts, but I think it is the best phrase that the Parliamentary draftsman can use—and any question as to the amount of compensation payable to him …shall be determined in like matter as if it had arisen under the Act in question. Subsection (5) provides that when a damage notice has been served, the person serving it is to be treated as liable to make good the damage only if, within one month, he either obtains his landlord's consent or starts proceedings to establish his claim against his landlord under the appropriate Act, and he must notify the Board that he has done so.

That brings in the landlord and the Board as to the position under, for example, both the Landlord and Tenant Act and under this Bill. Nothing is going on behind anybody's back if that is done. We obviously have to do this because, for instance, the National Coal Board cannot be expected to know whether or not a tenant is entitled to serve a damage notice. We have also to be sure that the Board's obligation under the Bill will arise only when the dispute between landlord and tenant has been settled. The subsection provides for that.

Subsection (6) is more simple. It provides that proceedings under both the English and the Scottish Agricultural Holdings Acts will be deemed to have started when an arbitrator has been appointed, or when an application for the appointment of an arbitrator has been made to the appropriate agriculture Minister. Subsection (7) makes several consequential and purely drafting Amendments to the Scottish Acts which deal with small landholders and crofters. As I say, this new Clause is regrettably complicated, but I hope that its general intention commends itself to the House, and if any further explanation is required I will endeavour to give it to hon. Members.

6.45 p.m.

Mr. Oliver

I congratulate the Parliamentary Secretary on his very clear exposition of this very complicated Clause. He has explained in five or ten minutes something which I, not being an expert on real property, tried to elucidate for nearly two hours. I could not visualise the circumstances in which the claims could arise by reason of the multifarious Acts under which, in fact, they can arise. The explanation which the Parliamentary Secretary has offered makes it clear that whoever had the drafting of the Clause ought to be mentioned in the Honours List, and I congratulate the hon. and learned Gentleman himself most heartily on his exposition.

I have only one question to ask. Clause 5 (a) reads either it is agreed between that person and the owner before the expiration of the period of one month from the first service of a damage notice in respect of the property, or it is determined in proceedings by virtue of the last foregoing subsection begun before the expiration of that period, that that person is a protected tenant in relation to that property. If no agreement is arrived at in that period, what is the effect?

Mr. Renton

As I understand the position, if the tenant has started proceedings, and has notified the Board that he has started proceedings, nothing can happen with regard to the value payment under the Bill until those proceedings have been determined one way or another. I think that that is the right position because, to some extent, the amount of the value payment may depend upon findings of facts arrived at in those proceedings. However, the hon. and learned Gentleman has raised a point which should be a subject of further thought, and I undertake that I will think about it still further. My own impression is that the position as I have described it is right, and satisfactory, and is fair to the tenant, but if, after further contemplation of the matter, I find that further elucidation is needed, I will take appropriate steps.

Mr. Robens

When I first read rue Clause through to the end it meant precisely nothing to me. I therefore turned to my hon. Friend the Member for Wigan (Mr. R. Williams) who, besides having taken a great part in the proceedings on the Bill, advises me on legal matters. He assured me that the Clause was drafted with extreme clarity and was very well done. Not that I could understand it any better. However, I accept that it is a very well drafted Clause, and I see that opinion is reinforced by my hon. Friend the Member for Ilkeston (Mr. Oliver). The Parliamentary Secretary explained it so very clearly that even people who, like myself, found it incomprehensible, saw at once that it was a very sound Clause.

He indicated that it was undertaken by the Department and did not arise from anything said in Committee. Therefore, I would, first of all, thank him for having given this matter special attention—it shows his own close work in connection with the Bill—and say that obviously we would not seek to oppose the Second Reading of the new Clause. I presume, however—it is the one thing I could understand—that there is a printing error in line 23, and that the word "on" should be "of." I mention that just to make sure that the House understands that I did read the Clause.

Mr. Renton

In the copy which I have I am unable to detect a mistake. It seems to me to be all right, but perhaps I may be allowed to think about this still further.

Question put and agreed to.

Clause read a Second time and added to the Bill.