The role of the Tenant Farming Commissioner (“the TFC”) was created by the Land Reform (Scotland) Act 2016. Dr Bob McIntosh was appointed as the first TFC and he became operational on 1 April 2017.
Although the role is only part time, the TFC has a number of statutory functions to carry out. The legislation provides that the TFC must exercise his functions with a view to encouraging good relations between agricultural tenants and landlords.
As we approach the end of the TFC's first year, we have reviewed the progress which has been made so far.
Codes of Practice
One of the primary functions of the TFC is to prepare codes of practice providing practical guidance to agricultural landlords and tenants.
The TFC has published the Codes of Practice set out below with support from the Scottish Tenant Farmers Association, National Farmers Union for Scotland, Scottish Land & Estates and, in some cases, the Royal Institution of Chartered Surveyors and the Scottish Agricultural Arbiters and Valuers Association.
Amnesty on Tenant’s Improvements - This Code sets out how discussions relating to the amnesty on tenant’s improvements (which started on 13 June 2017 and will last for three years) should be conducted between landlords and tenants.
Planning the Future of Limited Partnerships - This Code applies where a limited partnership is approaching its dissolution date or where either the landlord or the general partner wishes to review the arrangement.
Sporting Rights - This Code seeks to regulate the situation where land is subject to an agricultural tenancy and a landlord has reserved sporting rights or leases them to a third party.
The Maintenance of the Condition of Tenanted Agricultural Holdings - This Code sets out the respective legal obligations of landlords and tenants relating to the condition of the holding and sets out a process for the parties to follow in order to agree how those obligations can be fulfilled.
Each of the Codes distinguish between legal requirements (steps which must be carried out by landlords or tenants), actions which are required in terms of the Code (steps which should be carried out by landlords and tenants – failure to comply with these steps may be a breach of the Code) and actions which are recommended (failure to comply with the recommendations will not be a breach of the Code).
There is no legal sanction for failure to comply with a Code. However, the TFC has the power to investigate a breach of a Code where he receives a complaint from an interested party and must then prepare and publish a report.
Whilst there have been no reports published regarding breaches of Codes to dates, it is widely known across the tenanted sector that the TFC has received informal “referrals” where he has been asked to assist in situations where conflict has arisen between a landlord and tenant. Whilst there may not be an applicable Code, the TFC is willing to become involved in a situation in order to encourage reasonable behaviour from the parties.
In addition to Codes of Practice which seek to regulate behaviour, the TFC has also published “guides” on the following subjects –
- The process of relinquishment and assignation contained in the 2016 Act (not yet in force)
- The Essential Features of Modern Limited Duration Tenancies which were introduced by the 2016 Act and came into force on 30 November 2017.
- Guide to the agricultural reforms contained in the 2016 Act.
Update of Schedule 5
The 2016 Act required the TFC to prepare recommendations for a modern list of improvements which are eligible for compensation at termination of an agricultural tenancy. The current list, contained in Schedule 5 of the Agricultural Holdings (Scotland) Act 1991, has not been updated for decades and therefore was considered to be out of date with modern farming practice. The TFC has prepared a list of recommendations, which include the addition of slurry stores and silage pits, for the Scottish Ministers.
Review of Conduct of Agents
One of the most controversial functions of the TFC is the preparation of a report on the conduct of agents for both agricultural landlords and tenants. The report must be laid before Scottish Ministers by 1 April 2018.
A telephone survey was conducted by an independent research company in 2017. The TFC has recently announced that the next step is to carry out further investigations where the respondent of the telephone survey expressed dissatisfaction with the conduct of an agent.