LAW OF PROPERTY (AMENDMENT) BILL. [H.L.] (Hansard, 23 March 1926)

§ LORD STRACHIE
I desire to ask the Lord Chancellor one or two questions before Clause 2 is agreed to. I should like him, if he will be good enough, to explain the reason for amending Section 140 of the original Act. I should also like to ask him if it is the case that, if an owner sells part of the farm and if the purchaser gives notice to quit to the tenant of that part, the tenant can give notice to quit the other part of the farm and claim compensation from the landlord. That appears to me to be the position under the law as amended, and it seems to me to be really rather necessary to amend this clause. But time has been so very short that I have been unable to consult with those interested in the matter and I am merely making the suggestion on my own behalf.
Again, if this proposed amendment of the law is agreed to, what will be the position of a landowner who sells part of a farm, and how will the provisions of the Agricultural Holdings Act, 1923, apply in such cases? It seems to me that the legal position is very difficult indeed, for, as the House knows, the Agricultural Holdings Act, 1923, is very complicated 729 and difficult to interpret. All that I want to do now is to make an appeal to the Lord Chancellor not to rush this Bill but to give us an opportunity between now and the Report stage of considering it further and putting down Amendments. I think the noble and learned Viscount will agree that it is very difficult indeed for us, unless we have consultation with our legal advisers, to tell exactly what the effect of the Bill will be.

§ THE LORD CHANCELLOR (VISCOUNT CAVE)
I agree that the question is rather complicated, but I think I can give the noble Lord an explanation in a few words. The effect of the Act of 1922 and of the Consolidating Act of 1925 is that when land which is let to a tenant is severed—that is, when part is sold to a new owner and part retained— the conditions are apportioned, so that the owner of part of the land can give the tenant notice to quit that part of the land. The Acts of 1922 and of 1925 make provision for this difficulty in the following way. The framers of the Act saw that the effect of giving notice to quit part only of a farm might be to make the rest of the farm almost impossible to work. It might be too small or it might have no proper buildings, no farmhouse or something of that kind. Accordingly the existing Act provides that where notice is given to quit part of a farm by the owner of that part the tenant may give a counter-notice to quit the whole so that he may get rid of his tenancy.
That was all right so far as it went, but I think one point was overlooked. If the tenant took advantage of that provision and gave notice to quit the other part he would not be entitled to compensation for improvements because, the tenancy being determined by himself and not by the landlord, the provision as to compensation would not apply. That might be very unjust to the tenant, and accordingly we are amending that provision by saying that, if the owner of a part gives notice to quit his part, the tenant may, without himself giving notice to quit the rest, take the notice to quit part as a notice to quit the whole, and by that means he does become entitled to compensation. That is the simple effect of the amendment made by this Bill.
The noble Lord has raised a point which I think certainly deserves 730 consideration. He asks what will then be the effect of the special section in the Agricultural Holdings Act, 1923. As the noble Lord knows as well as any of us, where, under that Act, notice is given to quit a small part of a holding for the purpose of forming allotments or for certain other purposes and the tenant says: "Very well, I will quit the whole," the tenant is not entitled to compensation for the small part. He is using the machinery of the Act in order to get rid of his tenancy. I think the noble Lord suggests that this arrangement should apply to this clause also. I admit that this is rather a complicated point, but it is well deserving of consideration and, if the noble Lord will permit me, I will consider the matter to see whether we ought to introduce in this substituted proviso words which will bring that section of the Act of 1923 into operation. I was anxious to get an early passage for the Bill but, since this point has arisen, I am afraid I cannot put down the next stage for an earlier date than Thursday. If the noble Lord will be good enough to tell me privately what he thinks ought to be done, or if he will look at an Amendment which I will show to him, I have no doubt that we can by Thursday agree upon a form of words, if any Amendment is required.

§ LORD STRACHIE
I am very much obliged to the Lord Chancellor for putting the Report stage off until Thursday, if he cannot put it off even a little longer. Even so there will be very little time to consult with those who advise us on questions of this kind, and I should have been very much obliged if he could have put the Report stage down for Tuesday.

§ THE LORD CHANCELLOR
I should very much like to get my Bill before Easter, if possible.

§ LORD STRACHIE
That would make it impossible. Did I make myself quite clear about one point? I do not think the noble Viscount answered it. It is this: Whether, as the clause now stands, it is the case that where a man has sold part of a farm, retaining the rest, and the man to whom he has sold that part of the farm gives notice to the tenant of the owner, then the tenant has a right to give notice to the landlord to quit the rest of the farm, which the landlord did not sell, 731 and in consequence the landlord, although he has not given the tenant notice, has to pay compensation to the tenant for disturbance. That is what we object to. We think it is unfair that the landowner, who does not give notice to the tenant to quit the rest of the farm, is nevertheless liable to have notice given to him by the tenant, and will then have to pay compensation.

§ THE LORD CHANCELLOR
That is not the effect of this clause, but is what the existing Act provides. It is thought that it is not fair that the man should sell part of a farm and not pay compensation for disturbance.

§ LORD STRACHIE
It is not a question of a man selling. It is when a man has sold part, say twenty or thirty acres, but does not give notice to the tenant to quit the remaining 200 acres. Will the effect of his having sold part of the farm, and of the purchaser having given notice to the tenant, be to entitle the tenant to give notice to the landlord to quit the remainder of the farm and demand compensation from the landlord? That, I am told, is the effect of the amendment made by the Bill.

§ THE LORD CHANCELLOR
I understood the noble Lord perfectly well. That is the effect of the Act as it is to-day. All we are now doing is to say that if that happens the tenant shall not lose his right to compensation.

§ LORD STRACHIE
It is the landlord and not the tenant who is damnified. Perhaps the noble and learned Viscount will let me come and talk the matter over with him.

§ LORD BANBURY OF SOUTHAM
Will the noble and learned Viscount let me ask him this question? A landlord lets a farm to a tenant, and it is agreed that should the landlord require to take possession of a certain portion of the farm at an agreed rent, then that can be done. Suppose the landlord does do that, and the tenant under this new proposal gives the landlord notice to quit, will the tenant be entitled to compensation, although he had agreed when he took the farm to surrender part of it when called upon?

§ THE LORD CHANCELLOR
I am not here to answer hypothetical questions, 732 but I should be inclined to answer "No." At all events, this Bill does not affect that question.