Lords Sitting of 12 March 1875

MINUTES.
PUBLIC BILLS—First Reading—Superannuation Act (1859) Amendment* (37); Agricultural Holding's (England) (39).
AGRICULTURAL HOLDINGS (ENGLAND).

  BILL PRESENTED. FIRST READING.
  THE DUKE OF RICHMOND, on rising to call attention to the law relating to Agricultural Holdings in England, and to present a Bill on that subject, said: My Lords, probably some of your Lord-ships may have remarked by the Notice Paper circulated this morning that an alteration has been made in the precise terms of the subject which I shall have the honour to bring before you, and that, instead of dealing with the law relating to agricultural holdings generally, the Bill which I shall lay on the Table of the House will apply only to the law relating to agricultural holdings in England. This is not because I wish to evade dealing with the matter as it regards agricultural holdings in Scotland; but there is a difference in the circumstances and laws which prevail in the two countries respectively, and for this reason, while it would not perhaps be quite impossible, it certainly would be very difficult to combine the cases of the two countries in one and the same Bill. While in Scotland, for instance, the lease will only pass to the hereditary descendant of the lessee, in England a lessee's interest will pass to his executors, administrators, or assigns. In Scotland no one can assign a lease without the consent of the lessor; but suppose a

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  lease there is granted for 19 years, at the expiration of that term, unless notice is given to the tenant, he continues on the same terms by what is termed tacit relocation, until a fresh arrangement is made. Your Lordships will, therefore, understand why we have thought it more advisable not to attempt to legislate for England and Scotland in the same Bill; but I purpose to present before long a Bill to do for Scotland what this measure will do for England, and, as far as possible, to assimilate the laws of the two countries in respect of agricultural holdings. I may, however, observe that what I have to say on this occasion will apply equally well to Scotland as to England. And here, my Lords, I would observe that there is a topic intimately connected with the one on which I am about to address you—I mean the power of limited owners and ecclesiastical corporations and incumbents in respect of the making of leases; but the Acts of Parliament relating to this branch of the subject are so various, and the details connected with it so numerous, that we have found it impossible to master them sufficiently to enable us to include this portion of the subject in the Bill which I shall this evening lay on the Table; but we do purpose, by a separate Bill, to give power to limited owners, ecclesiastical corporations, and incumbents to grant leases, in order that their tenants may be put in the same position as that held by the tenants of other owners. My Lords, I am sure I need not apologize for bringing this subject under your Lordships' consideration. It is in the highest degree important, because it has a very close connection with the production of food for the consuming millions of this country. It has a great importance and interest for your Lordships and all other land-owners; it is obvious that it has not less importance and interest for those who cultivate the soil, and all with whom landowners are brought into intimate relations; and if it is important and interesting to those two classes, it is not of less moment to the community at large, who, as consumers, must be exceedingly desirous that the producing power of the agricultural districts of the country should be brought to such a pitch that it will go as close as it can possibly be made to go towards meeting the requirements of the country. My
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  Lords, this is not a new subject. It is one which has long occupied much attention out-of-doors. At almost every agricultural meeting held for some time past it has been the theme of discussion—and not recently for the first time—because some years ago it was the topic of speeches and inquiries. I am not going to weary your Lordships by taking you very far back; but I think it will be necessary to ask you to bear with me while I refer you to something which occurred in 1848, when the subject was brought more particularly and distinctly under the notice of the other House of Parliament by a Gentleman as competent to give an opinion on it as any one who could have been named—Mr. Philip Pusey, the Member for Berkshire, and Chairman of the General Committee of the Royal Agricultural Society. He endeavoured to deal with the subject in the manner he thought best; and in doing so he was assisted by the late Mr. Evelyn Denison, the Member for Nottinghamshire, a practical agriculturalist of great knowledge and experience. On the Motion of Mr. Pusey, a Select Committee was appointed—
  "To inquire into the law and custom of different parts of England and Wales as between outgoing and incoming tenants, and also as between landlord and tenant, in reference to unexhausted improvements or deterioration of land and promises occupied for agricultural purposes."
  When I read the names of the Gentlemen who served on that Committee, which was presided over by Mr. Pusey himself, I am sure your Lordships will be of opinion that a better selection could not have been made, comprising, as the Committee did, men of all shades of political opinion, who came from all the various parts of the Kingdom, and who possessed a personal knowledge of the subject which they were called upon to consider. My Lords, on that Committee were Mr. Pusey, Mr. Newdegate, Mr. Stafford, Mr. Evelyn Denison, Mr. Egerton Tatton, the Earl of Arundel and Surrey, Mr. Henley, Mr. Bouverie, Sir Charles Lemon, Mr. Moody, Mr. Sotheron, Mr. Colvile, Mr. Burroughes, Sir John Trollope, and Mr. Hayter. My Lords, that Committee sat for three months and examined something like 52 witnesses; and the general tenour of the evidence of those witnesses was to show

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  that what was the complaint then is the complaint now. The complaint is, that there is insecurity to the tenant for the capital he has invested in the soil, which insecurity prevents the tenant from investing as largo an amount for agricultural purposes as he otherwise would, and which therefore results in the producing power of the country not being brought up to the pitch to which it might be raised if the tenant had security for that capital. So much was the want felt in what is called "high farming," that it became necessary where this description of farming was desired, to provide some security for the capital invested in the soil by the tenant; and consequently "customs" grew up. And, my Lords, no doubt, custom is important in considering this case and in arriving at a conclusion as to what we ought to do. It is not my intention to go through the list of all the customs that exist in this country with reference to these matters. To do so, even if my lungs did not fail me in the task, would occupy a longer time than I should venture to trespass on your Lordships, and than, probably, your Lordships would be inclined to grant me; but it may be taken generally that, in respect of compensation, customs attach to the preparation of the soil for crops by tillage, to the hay and straw and dung left on the farm, and to growing underwood. In some places the customs are very good. In Lincolnshire the custom is about as good a custom as any one would wish to live under. I have had the Lincolnshire custom before me in preparing the Bill, and I should have liked to embody it in the measure, but I found it impossible to do so, as it would have made it in some respects imperfect. In the part of the county in which I live the customs are rather loose; but in the northeast part of the county, towards Surrey and Kent, they are extremely onerous on the incoming tenant, putting him in pecuniary difficulties at a time when he wants as large a command of capital as possible. On one occasion a friend of mine took a farm in that part of the county and found himself charged, according to custom, with 19 harrowings for one field. He went to his lawyer, but was told that there was no other course for him but to pay it. I was told of another case, in which an incoming tenant was charged
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  £200 for a remarkably bad field of turnips. Your Lordships, at a later period, will see how by this Bill we propose to get rid of bad customs; but I may at once indicate it, by saying that a man will not be able to claim both under custom and under this Bill. Before the Committee of the House of Commons it was stated that, in many cases, customs led to fraud by the outgoing tenant taking up manuring before giving up his holding. The first paragraph in the Report sets out:—
  "That different usages have long prevailed in different counties and districts of the country, conferring a claim to remuneration on an outgoing agricultural tenant for various operations of husbandry, the ordinary return of which he is precluded from receiving by the termination of his tenancy. That this claim, which is called 'Tenant-Eight,' ordinarily extends to one or more of the following objects:—To the crop which the outgoing tenant has sown and leaves in the ground; to remuneration for the preparation of the soil for crops by tillage, for the straw, hay, and dung left on the farm, and for growing underwood. That these local usages are imported into leases or agreements for the letting and occupation of land between landlord and tenant, who are presumed to contract with reference to such usages, unless the terms of the agreement, expressly or by implication, negative such a presumption. That in some parts of the country a modern usage has sprung up, which confers a right on the outgoing tenant to be reimbursed certain expenses incurred by him in cultivation other than those of the ordinary husbandry, above referred to. That among such expenses are included, the purchase of food for stock, the purchase of certain kinds of manure, and the draining, chalking, and marling of the soil; the result of all which outlays is to effect an improvement of the soil, more or less lasting, and requiring more or less time to elapse before the increased productiveness thereby obtained, reimburses the expenditure incurred. That, except in the districts where this usage prevails, unless by express stipulation, the outgoing tenant cannot claim compensation for any of those improvements, however short may be the time between their completion and the termination of his occupancy."
  I think, my Lords, that is a state of things which does require a remedy; because it amounts to this, that as the law now stands—in many places there being no custom—the tenant may put his capital in the soil, and so increase the value of the soil, the benefit of which is unexhausted at the termination of his tenancy, and yet reap no benefit whatever from the investment of his money, but the whole goes into the pocket of his landlord. I think that is a state of matters which its not at all satisfactory,

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  and that the Committee were perfectly right in the opinion stated by them at the close of the passage which I have just quoted from their Report. In another part of their Report the Committee, after referring to certain customs of compensation, state—
  "That this wider system of compensation to the outgoing tenant seems to be highly beneficial to agriculture, to the landlord, and to the farmer; to lead to a great increase in the productiveness of the soil and to extended employment of the rural population. That the benefit arising from this system appears to be gradually becoming more extensively known and appreciated, and the system itself seems to be finding its way into other districts than those; where it has hitherto been in force. That the improvements abovementioned, which are very generally required throughout the country in order to develop the full powers of the soil, are greatly promoted by this system of compensation, and therefore it is highly important that all difficulties should be removed which stand in the way of its extension by the voluntary act of landlord and tenants. That any attempt to make its general introduction compulsory would be met by great practical difficulties, and your Committee rely for the general and successful adoption of the system on mutual arrangements between landlords and tenants. That it seems very desirable to your Committee that estates under settlement should be endowed with every practicable privilege for their advantage which is attached to absolute property, and that persons having limited estates, in addition to the ordinary leasing powers generally conferred on them, should be enabled, under proper precautions, to enter into stipulations of the nature of those above referred to, which at present it appears they cannot do. That the power to enter into such stipulations, binding on subsequent interests, might be advantageously made a general incident to leasing powers of land in settlement, by the aid of Parliament; and also be conferred on persons having certain limited interests in land."
  Your Lordships will perceive that the Committee did not recommend at that time that there should be any compulsory legislation on the subject. They proposed to leave it to such general agreement as might be come to between the landlord and the tenant. They point out the great difficulty existing as to settled estates, in the case of which limited owners have no power to charge the estate with compensation. They may agree with the tenant to pay him money for improvements; but if the limited owner should die before the compensation comes to be paid, the charge is merely one on his personal estate, which of course makes the security much less than it would be if the compensation
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  were a charge on the estate. Among the witnesses examined by the Committee was Mr. Wren Hoskyns, and certain opinions given by him are worthy of your Lordships' attention. In the notes of his examination in this passage—
  "To take another case: if a landlord in Leicestershire signed an agreement to give five years' compensation for lime, the custom of the country being only for one year, would he be safe as to his personal representative after his decease in so enlarging the existing custom?—I think that it would not charge the estate; the claim would be against his personal representatives. So that if the landlord, desirous of improving his property, were to sign those agreements to a large extent, and the property were to descend to the minor, a distant relative, the guardians of that minor would, in your opinion, not be justified in paying that compensation to the tenants out of the income of the minor?—I think not, as claimed of right. Therefore their legal course would be to throw the claim upon the legatees of the deceased landlord?—Upon the personal representatives. The personal representatives of the deceased landlord?—Yes."
  My Lords, I doubt whether any one in this House will say that is a condition of things that ought to be allowed to continue longer. I think public opinion has been sufficiently roused and that Parliament is now competent to deal with it. After 25 years of agitation this matter has been amply digested, and the feeling now is in favour of legislation. No doubt the subject is a difficult one: but at the same time when we look to the increase of the population of the country, it will be seen that it is necessary to do something. According to the Census Returns in 1851 the population of England and Wales was then 18,054,170; in 1871 it was 22,712,266, showing an increase of 4,658,096 between the two periods. At the former period of 37,324,915 acres of land. 24,905,758 were cultivated. Of course, the total acreage was about the same in 1871, but the cultivated portion was 26,322,477, showing an increase of only about 1,000,000 acres. So that the increase of the population has gone on much faster than the increase in the acreage of cultivated land. My Lords, under these circumstances the Government have thought that a measure should be brought in to secure to the tenant the capital he has invested in the soil. I myself am much in favour of leases. Though I know that is not the common feeling South of the Tweed, I propose in this Bill to deal with yearly tenancies

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  and also with leases. Of course, it is open to any owner of land to grant leases or not as he may think fit, but I am in favour of granting leases. I think that where you give a lease you are almost certain of a good tenant, and any one who has got a good tenant will not want to get rid of him. It is a great mistake to suppose that a landlord wants to change his tenant if he is a good tenant. I never in my experience knew an instance in which the landlord did not lose money by a change of tenant. Therefore on a selfish ground, if not on any higher principle, I like leases. My view is that where a lease is granted there is security—to the holder for his improvements—that is for his unexhausted improvements—and in my view it is a satisfactory arrangement between landlord and tenants. I have heard it stated that leases are objectionable, and especially leases which are put up to auction. Well, I think putting them up to auction is objectionable, for though you get the highest bidder you may probably get the worse farmer. The highest bidder is, perhaps, a man who does not look very far ahead—all he would want would be to get upon your farm, and he would chance whether he would have a good or bad time. I repeat that, to my idea, the best arrangement for both parties is a lease on fair terms; and I believe that if this were offered tenants would accept it in 99 cases out of 100. No doubt the general rule of English tenancies is a holding from year to year, with six months notice to terminate the tenancy. Tenancies at will are seldom found to exist now in respect of land. They are tenancies in which either party gives the other 24 hours' notice; that being the difference between tenancies from year to year and tenancies at will. My Lords, the principle of the Bill which I intend to lay before your Lordships is that where the tenant on his holding makes improvements of a certain kind, which I shall specify, he shall be entitled to compensation in the manner which I will describe to your Lordships. I am very unwilling to enter too much into details; but I am afraid I must do so, my object being that before I sit down your Lordships should understand everything in the Bill. I propose that the improvements shall be divided into three classes—

  FIRST CLASS.

  Drainage of land.

  Making or protecting of fences.

  Erection or enlargement of buildings.

  Planting of orchards.

  Making of gardens.

  Reclamation of waste land.

  Making or improving of roads or bridges.

  Warping of land.

  Making or improving of watercourses, ponds, wells, or reservoirs.

  My Lords, for so much of those improvements the tenant shall be entitled to compensation under the Act and subject to its conditions on the termination of his tenancy by reason of effluxion of time or for any other cause—that is for so much of them as is unexhausted. I propose that as regards the first class no claim is to be allowed unless the improvement has been made within 20 years before termination of tenancy, and with the previous consent in writing of landlord. As regards the second class, no claim to be good unless the improvement has been made within seven years; and as regards the third class, no claim to be good unless it has been made within two years. There is to be some check to prevent unfair outlay on artificial manure towards the end of the tenancy. Your Lordships will observe that the second and third classes of improvement may be made without the consent of the landlord in writing—such consent is required only in the case of the first class. I propose that the tenant should be compensated in this way. The amount of compensation to be a capital sum representing the unexhausted addition—as at the termination of the tenancy—made by the improvement to the letting value of the holding. The amount of the tenant's compensation shall be subject to the following deductions:—(1.) For I taxes, rates, and tithe-renteharge due or

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  becoming due in respect of the holding to which the tenant is liable as between him and the landlord: (2.) For rent due or becoming due in respect of the holding: (3.) For the landlord's compensation under this Act in respect of waste. And in the ascertainment of the amount, there shall be taken into account in reduction thereof any benefit which the landlord has given or allowed to the tenant in consideration of the improvement. On the other hand, when a tenant commits waste, diminishing the letting value of the holding, the landlord will be entitled to receive, on the determination of the tenancy, compensation in respect of the "waste," and I propose that the following acts and things shall be deemed waste diminishing the letting value of the holding:—Breaking up of old grass without the written consent of the landlord; causing or permitting of land to be foul or neglected; damage to plantations, coppices, or timber included in the holding; loss of manure by hay, straw, roots, or green crops removed off the holding without the written consent of the landlord; loss of manure not returned to the holding in lieu of produce sold off subject to the manure being brought back; mowing of meadows, other than water meadows, without manuring; mowing of old pasture; neglect of drains, out-falls, or water-courses; neglect of gates or fences; neglect of ordinary repairs of buildings for which the tenant is liable; neglect of roads; over-cropping by the taking of too many successive white-straw crops; over-cropping without manuring; but nothing in the Act shall prevent any act or thing not specified in this section from being deemed waste diminishing the letting value of the holding. All these things are to be regarded as "waste," and are to be matters of setoff on the part of the landlord as against the tenant's claim for compensation; and the amount is to be a capital sum representing so much of the diminution of the letting value as continues at the termination of the tenancy. Now, my Lords, as to procedure. This is the mode in which I propose that the arrangements between landlord and tenant are to be carried out under this Bill. Notices of claims are to be given by tenant or landlord to the other of them three months before the end of the tenancy. The landlord and tenant may
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  agree on the amount and mode and time of payment of the compensation. Of course, if both parties agree, there is an end of the matter. In case they do not so agree, the difference is to be settled by a reference. Both parties may agree to appoint a single referee. If they cannot agree upon such a referee, each appoints a referee, and the referees appoint an umpire. If they cannot agree, I propose to give the selection of the umpire to the Judge of the County Court. In such cases I think he would be a very competent person to make the selection. The amount agreed to or awarded, as the case may be, will be recoverable by summary process. I propose that there should be an appeal in cases where the amount of compensation is £100 or over; but that there should be no appeal where the sum awarded is less than £100. One must fix some limit, or otherwise there would be vexatious claims which would put the parties to considerable inconvenience. You want to give the tenant security for the compensation to which he is entitled. I propose, therefore, that a landlord, on paying compensation to a tenant, may apply to the County Court for a charge on the holding in respect of the amount so paid.
  VISCOUNT HALIFAX: To what tribunal is the appeal, where an appeal is given?
  THE DUKE OF RICHMOND: To the County Court Judge. If the owner is an absolute owner, of course he can charge the property for any time he pleases; but in case of limited owners, where the Court is satisfied that compensation has been properly paid in respect of something that will add to the letting value of the farm, I propose that he may make the amount so paid a charge on the estate for 20, seven, or two years from the time the improvement was executed, according to the class of the improvement. These terms are proposed, because in the case of improvements of the first class, the claim for compensation must be made within 20 years from the time of the execution of the improvement; in the case of the second class, it must be made within seven years; and in the case of the third class within two years; or, in other words, the improvements, according to their respective classes, must have been made within those limits of years

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  previously to the termination of the tenancy. The instalments payable out of the estate in discharge of the compensation shall be charged in favour of the landlord, his executors, administrators, and assigns; and, my Lords, for the purposes of this Bill, the title "landlords" is to mean the person entitled to possession of land subject to a contract of tenancy, or entitled to receipt of rent reserved by a contract of tenancy. It follows, therefore, that the limited owner is brought within the four corners of this Bill, and that any compensation which he shall have to pay the tenant will be legally chargeable on the land. With regard to leasing power to limited owners, that, as I have already intimated to your Lordships, will form the subject of another Bill. As to notices to quit, under the present system, in the case of yearly tenancies, the notice is half-a-year. I propose that in future that the notice shall be increased by half-a-year—that is, that there shall be a year's notice to quit in the case of a farm. The Bill contains a provision with respect to the taking of land for cottages and gardens; but with the details of this I need not trouble your Lordships. Existing leases are excluded from the operation of the Bill; but as it is perfectly clear that some machinery is necessary in order to bring it into operation as regards yearly tenancies—for otherwise that provision would be a dead letter—I propose that the Act should come into operation within three months from January, 1876; and unless within two months of that time either party—the landlord or the tenant—intimates that he does not intend to come under the Act, it will come in force as regards all yearly holdings. There is one other point. We do not propose to interfere with freedom of contract. I think your Lordships will see the force of this. If the Bill is wanted at all, it certainly is not wanted for small men, because they have no capital wherewith to make improvements on the land—they have nothing to put in the soil. But we are told that there are men of means and intelligence who desire to put capital in the soil for the purpose of increasing its productive powers, and my knowledge of that class of farmers certainly leads me to believe that, as a rule, they are perfectly competent to enter into agreements with their land-lords
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  if they are assured compensation for unexhausted improvements. For that reason I should be one of the last to interfere with freedom of contract. On the contrary, I think it should be maintained; and hence it will not be affected by this Bill. My Lords, I am not vain enough to think that this Bill will satisfy every one; but I think it ought to satisfy every moderate and reasonable man; for while, on the one hand, it gives to the tenant that protection to which he is entitled, on the other hand it does not invade those rights of the landlord which in this country have always been held sacred. My Lords, I beg to move that the Bill be read a first time.
  EARL GRANVILLE: When does the noble Duke propose to take the second reading?
  THE DUKE OF RICHMOND: As to that, I am quite in the hands of your Lordships. My object is not to press the Bill on unduly, and of course I should not think of moving the second reading till after Easter.
  LORD REDESDALE: As to the power of appeal, why should you limit it to cases in which the compensation will be £100 or over, and in which the tenant holds, perhaps, 500 acres? Why should not the tenant with 20 acres have an appeal?
  THE DUKE OF RICHMOND: Because the man with 20 acres would never lay out a shilling that would entitle him to compensation.
  LORD REDESDALE: But he might; and suppose he did? I think the noble Duke ought to reconsider that point.
  Motion agreed to; Bill for amending the Law relating to Agricultural Holding in England, presented by the Lord President; read 1a; and to be printed. (No. 39.)
  House adjourned at quarter past Six o'clock, to Monday next, Eleven o'clock.