CONVEYANCING AND FEUDAL REFORM (SCOTLAND) BILL (Hansard, 20 May 1970)

§ THE LORD ADVOCATE (LORD WILSON OF LANGSIDE)

My Lords, I beg to move that this Bill be now read a second time. The Bill represents the first stage in the fundamental reform of land tenure in Scotland which was outlined in the White Paper, Land Tenure in Scotland: A Plan for Reform, published by the Government in July of last year. The changes proposed in the White Paper are not such as readily lend themselves to accomplishment overnight. They are of a complex nature, and because of that the Government's view, expressed in the White Paper, was, and remains, that the final legislation could not be ready until 1971 at the earliest. What, however, we made clear was that we would deal in the interval with some of the aspects of the existing system most ripe for change, at the same time making 1155 some other much-needed changes in the law of conveyancing. As my right honourable friend the Secretary of State said in the Third Reading Debate in another place, we believe that the publication and presentation of the White Paper contributed to the creation of a new climate of opinion in Scotland about land tenure; a climate in which fairly fundamental change is accepted both as being desirable and attainable.

I think one can fairly claim that the Bill received a warm welcome in Scotland, both from the legal profession and from others, and the Government have been further encouraged by the fact that during the debates on the Bill in another place no-one has seriously called in question either the need for fundamental reform of land tenure in Scotland or the need for the main provisions of this particular Bill. Such criticisms as have been made—and of course there were some—have related in the main to matters of procedure and practice rather than to matters of fundamental principle. These criticisms have, of course, in the main been helpful and useful, and the Bill in its present form reflects a number of changes which we agreed to make during the earlier stages.

Before touching, I hope very briefly, on the main purposes of this measure, I think it appropriate that I should say that both before and since the publication of the Bill we have had the benefit of widespread consultation with a large number of bodies, and indeed individuals, concerned with the day-to-day work of land transactions in Scotland, and we are very grateful to them for the considerable trouble to which they have gone to ensure that we should have the benefit of their comments on the detailed provisions of the Bill. We are indebted in Scotland in particular—and I must say this—to Professor J. M. Halliday, the Report of whose Committee forms the origin of much that is in the Bill and who, incidentally, has continued very helpfully to act as consultant to the Scottish Office since the Bill was introduced. I should perhaps also at this stage acknowledge the so very valuable work which has been done in this field by an earlier Committee on registration of title to land in Scotland, which was chaired by a distinguished Member of your Lordships' 1156 House, the noble and learned Lord, Lord Reid. It was of course, as the noble Earl knows far better than I do, as a result of a recommendation in the Reid Report that the Halliday Committee was subsequently set up.

My Lords, the Bill has three main purposes. The first is to reform certain features of the existing system of land tenure. The second is to create a new form of heritable security for loans over property which is simpler and more satisfactory than the existing forms of security. The third is to simplify and clarify a number of aspects of the law of conveyancing in Scotland.

Part I of the Bill contains the reforms of the feudal system as it at present stands. Provision is made, for the first time in Scottish legislation, for a means of appeal against burdensome land obligations. The Lands Tribunal for Scotland, for which statutory provision was made over twenty years ago in the Lands Tribunal Act 1949 (the Tribunal was never set up) is now empowered to vary or discharge such obligations and to pay compensation, in certain circumstances, according to defined criteria. These provisions have great potential usefulness in removing unreasonable impediments to development. This Part of the Bill deals also with a problem which has caused a great deal of injustice and hardship to individuals, with which your Lordships are no doubt familiar; namely, that of unallocated feuduties. A system of procedure is set out whereby a vassal, faced with the reality or the threat of having to act as an unpaid debt-collector for his superior, is able to secure allocation of his own portion of the feuduty, and thereby have a limit set to his particular liability.

Part I also makes provision in Clause 8 for a reduction in the period of positive prescription from twenty years to ten years. This is a reform which has been widely welcomed by the legal profession in Scotland, and which should save a good deal of time and, one might hope, in consequence, expense, in property transactions. Parts II and III of the Bill have their origin in the Report of the Committee on Conveyancing Legislation and Practice, to which I have already referred, which sat under the chairmanship of Professor Halliday. The 1157 Committee concluded in the course of their deliberations that the forms of heritable security prescribed by Statute were unsuited in many ways to modern conditions and commercial practice. They accordingly recommended the creation by Statute of a new and more satisfactory form of security.

Part II of the Bill aims to create this new form of security, to be known as a "standard security", which will be free of the defects of the present statutory Scottish forms, and which will be adaptable to all the kinds of situation in which it is necessary to create a security over land. The individual clauses in Part II set out the provisions relating to the constitution of such a security, and deal with the various types of transaction that may arise in relation to it: they are also designed to make rights and responsibilities clear for debtor and creditor alike in such matters as enforcement of the security where the borrower defaults. When the Bill passes into law there will of course be very many securities still in existence which have been created under the present law, and the aim of Part III of the Bill is to simplify the law governing such securities.

Part IV of the Bill contains a number of provisions, again based on recommendations of the Halliday Committee, which are designed to bring certain features of the law of conveyancing more into line with modern conditions. The Government have good reason to believe that they will all be welcomed by the legal profession in Scotland, and by others concerned with transactions in land, as improvements in this area of the law. Part V of the Bill contains in Clause 49 an amendment to the Church of Scotland (Property and Endowments) Act 1925, the desirability of which was brought to the notice of the Government by the Church. Clause 50 makes certain amendments to the Lands Tribunal Act 1949, which are designed to enable the Tribunal to discharge the responsibilities already vested in them by existing Statutes and the important new functions conferred upon them by this Bill. Finally, Part VI of the Bill contains a number of the usual general provisions relative to Crown application, interpretation and the like.

In the Government's view, and I am sure your Lordships will share it, the 1158 Bill is a useful and practical piece of forward-looking legislation. Though it is a precursor of major legislation, it is important in its own right and will be of not inconsiderable value to Scotland. In short, it can be recognised as a useful and significant reforming measure in the context of this aspect of the law, and I hope that your Lordships will agree that it should be read a second time. My Lords, I beg to move.

§ THE EARL OF DUNDEE

My Lords, this Bill, which has been so well explained to us by the noble and learned Lord the Lord Advocate, is mainly a Bill reforming the law of conveyancing, which I think enjoys general support. It happens to bear what I think is the rather pretentious title of Conveyancing and Feudal Reform (Scotland) Bill, but in fact it does very little about feudal reform. It is nearly all about conveyancing, and it is nearly all agreed, and in so far as it affects feudal reform I think this Bill is generally agreed also.

The only thing which I think the Bill does about feudal reform is this. Under our present law in Scotland when land is feued under a charter, which determines the use to which the land shall be put under that charter (although the charter is perpetual) if the owner of the land wishes to change the purpose, or to alter the contract under which he or his predecessors signed the feu charter, he has to get the leave of the superior which the superior may or may not give; or if he does give it he may say that, as the effect of the change would in one way or another damage the purposes and nature of the property, he would like compensation for it. So that the owner of land which is held under feu charter has to get the consent of two parties, the feudal superior and the town and country planning authority, which I think is probably a good thing. Sometimes the feudal superior may be a better judge of the public interest than the town and country planning authority, and there is no harm in having two planning authorities.

This Bill now provides that if the consent of the superior is withheld on a proposal which the superior thinks may 1159 be unreasonable the owner can appeal to the Lands Tribunal, and the Lands Tribunal may decide that he should be allowed, in spite of the opposition of the superior, to do what he wants with his own land. I only wish that there could be a similar appeal against the decisions of the town and country planning authority, because they are not always infallible either. But I think it is perfectly right that there should be this appeal, which is provided for in the Bill, against the veto of the feudal superior; and I think practically everybody is in agreement with that.

But this Bill has been discussed in the country and in another place, not as if it were a Bill which was almost universally agreed on by everybody—which it is—but as if it were a Bill to abolish what is called the feudal system in Scotland, which of course it is not. I think that to-night we ought to confine ourselves simply to what is in the Bill and not to what people in another place or in the country have implied may come after the Bill.

I noted what the Lord Advocate said about changes in the climate of opinion with regard to the fuedal system. The noble and learned Lord will remember that in England subinfeudation was abolished by a Statute of King Edward I, 600 or 700 years ago. It was not abolished in Scotland. Since then, while subinfeudation has disappeared in England, the system there of leasing land to occupiers or leaseholders has been far more oppressive and far more onerous than the feudal system in Scotland, which has been on the whole a lenient and benign system which has enabled, among other things, the feuar of the land to occupy his property in perpetuity for an annual payment (or service which has been commuted into an annual payment) whose value continually declines with the decline in the value of money. This is a very great advantage to the feuar. I am very doubtful whether it would be to the advantage of people in future who want to acquire building land in Scotland that this system should be altered.

The land on which my own home is situated happens to be land of which I am not the tenant in chief. It is land which was feued in the year 1500 by the Abbey Balmerino because there were not 1160 enough monks to work it all, and they feued off a great part of their property for an annual feu duty of £17 sterling a year—sterling, that means over £200 Scots a year, which is not very much now but it was quite a lot in the year 1500; and that has gone on all these centuries becoming worth less and less all the time. About 15 years ago I caused this feuduty to be purchased by my son, who was then a small child not able to act for himself—he is only 21 this year—because I thought it would be a good thing for him that he should acquire that feuduty. He now tells me that I have cheated him and he is not at all satisfied. He points out to me that 15 years ago this annual sum of £17 would have been enough to pay for one of these student skiing trips to Switzerland and back, whereas now it is hardly enough to pay a return air tourist fare from London to Edinburgh—and he thinks that if a Labour Government are returned next month it may very soon not be enough to pay for a bus fare from London to Greenwich. So he has this grievance.

I point out to him that he is really very lucky, because after all he is the superior and I am only a vassal, and he ought to be very happy. I also point out to him that, under paragraph (ii) of subsection (4) of Clause 1 of this Bill, if I should decide to use any part of this land for any purpose, such as having some interesting caravans, or do anything else exciting with it, of which he does not approve, and if he appeals, then a sum to make up for any effect which the obligation produced, at the time when it was imposed"— that is to say, in the year 1500— in reducing the consideration then paid or made payable for the interest shall be given to him. I tell him that he will be very lucky to get this compensation but he still does not seem to see the point.

However, my Lords, I hope that whoever is returned to Parliament in the Election will think of the future interests of feuars, and I rather hope that this emotive wording, "superior" and "vassal", may be abolished, because it leads ignorant and uninstructed people to get quite a wrong and fallacious idea of the true meaning of this feudal system in Scotland. Newspaper readers who do not 1161 know what it is about cannot help thinking that a man who is called a superior must be in a position to exploit and oppress the person who is called the vassal, whereas in my own case it is entirely the other way round. I hope that that will be borne in mind in any future legislation. There has been a lot of grand talk about abolishing the feudal system, and all that has been introduced so far is this—I call it a little Bill so far as the feudal system is concerned but quite a good Bill so far as conveyancing reform is concerned. I hope that whoever comes back next time will bear in mind that the largest owners of feuduties in Scotland are not the great landowners now but, overwhelmingly, the Scottish Church, whose Assembly the Lord Advocate and I have just been attending and which we have both left in order to attend this debate.