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Ruaig an Fhèidh: 3

18 February 13

Land reform part 3: the Inner House has upheld the ECHR compatibility of the crofting community right to buy, as this review of the decision and its implications explains

by Malcolm Combe

There is an attempt at a dual meaning in the title and abstract of this article.

To explain, part 1 of “The Deer Drive”, or in its Gaelic formulation Ruaig an Fhèidh, was an anonymous poem commemorating a 19th-century land raid in the Pairc district of the Isle of Lewis.

Part 2 of Ruaig an Fhèidh was an article by the author (Journal, June 2011, 54), written after the Scottish ministers granted the first consent for the crofting community right to buy under the Land Reform (Scotland) Act 2003. The community to benefit was from Pairc.

Part 3 is this article, building on its predecessor in light of the Inner House decision in Pairc Crofters Ltd v The Scottish Ministers [2012] CSIH 96, which essentially approved the terms of part 3 of the 2003 Act and associated secondary legislation as Convention-compliant in relation to the ECHR. Thus the “part 3” in the heading can refer to either the sequence of literature or the relevant part of the legislation.

Part 3 of the Act allows a properly constituted crofting community body to acquire certain land compulsorily from the crofting landlord, following a ballot of the community members and ministerial sanction. The land that can be acquired is restricted to crofts (in terms of the Crofters (Scotland) Act 1993), common grazings and certain eligible additional land.

Applying this to the Pairc scenario, as further explained in the 2011 note, the statutory embodiment of the crofting community is a company limited by guarantee called the Pairc Trust. It sought to acquire a small part of the eligible land, namely certain land that was incontrovertibly part of the common grazings. The community company should not be confused with the landowning company, Pairc Crofters Ltd. Yet another company, Pairc Renewables Ltd, holds a lease from Pairc Crofters Ltd, and the tenant’s interest in that lease was targeted by the community (under s 69A of the Act), together with the heritable title.

After ministerial approval was granted, it was promptly challenged in Stornoway Sheriff Court. Although s 91 confers a defined role on the sheriff, he was moved to refer two devolution-related questions to the Court of Session (under sched 6 to the Scotland Act 1998), which broadly asked whether the legislation and Scottish ministerial actions complied with ss 29 and 57 of the 1998 Act (and in turn the ECHR) respectively. The respondents in the action were the Scottish ministers alone; the Pairc Trust left the defence of the challenge to them.

It will be recalled that when Lord President Gill was Lord Justice Clerk, he struck down Scottish legislation on grounds relating to article 1 of Protocol 1 to the ECHR (“A1P1”), in Salvesen v Riddell 2012 SLT 633 (see Combe, “Human rights, limited competence and limited partnerships” 2012 SLT (News) 193). In Pairc, in the longest of the three opinions given, he did not repeat that manoeuvre. Together with Lords Eassie and Malcolm, he firmly rebuffed the landowner’s complaints.

Some points were non-contentious. The landowner accepted it was within the gift of the Scottish Parliament to create a crofting community right to buy (para 26), and the ministers accepted that any determination on an application to buy would engage ECHR issues under article 6 (determination by independent and impartial tribunal) and A1P1 (para 29). Divergence emerged over whether the legislation contains adequate safeguards for the landowner and, in particular, whether any safeguards had to be set out clearly therein, but the landowner’s contention began to unravel as early as para 30 of Lord Gill’s opinion.

One thrust of the landowner’s argument targeted the Crofting Community Right to Buy (Ballot) (Scotland) Regulations 2004, which, as the title suggests, regulate the compulsory ballot. It was argued that the landowner was essentially overlooked in the process and the crofting community could perhaps skew the vote in its own favour, but this point was rejected as it was necessary that the ballot be “fair and reasonable” (reg 2). If it was not, the landowner could take issue with the breach of those regulations. Further, the ministers’ submission that ECHR compliance was not predicated on a ballot as a condition precedent to any decision to allow acquisition was accepted, so on that view, the 2003 Act is already a Rolls-Royce service for the landowner (paras 33 and 71).

On whether or not the landowner’s interests received adequate consideration, the fact that s 74(1)(n) requires the exercise of the right to buy to be in the public interest, clarified by s 74(2) to include “any sector (however small) of the public which, in ministers’ opinion, would be affected by the exercise of the right to buy”, meant that the landowner was indeed catered for (paras 37 and 106).

Having dealt with consideration in the deliberative sense, it might also be recalled that the Act provides for payment of fair value (ss 87-88), and thus the landowner would be receiving consideration in that sense of the word as well. That is a relevant variable in the calculation for A1P1 compliance (paras 40 and 105). There would only be a breach of A1P1 if the deprivation was “manifestly unreasonable” (James v UK (1986) 8 EHRR 123; Axa General Insurance Ltd, Petr 2011 SLT 106).

Of the other points addressed by Lord Gill, he did not accept that there was a “structural weakness” in the Act based on the lack of in-built opportunity for the landowner to give representations. The overall scheme of the legislation and the requirements of the Crofting Community Body (Prescribed Form of Application and Notice) (Scotland) Regulations 2009, which oblige the crofting community to detail how the land acquisition will further sustainable development and, in turn, afford the landowner a chance to respond, plus the common law duty to act fairly, put paid to that point (paras 41-47). One (presumably speculative) argument that was given decidedly short shrift by Lords Gill and Malcolm was that the undefined terms “sustainable development” and “public interest” were rendered “not law” by their vagueness (paras 55-57 and 111-114).

What is the role of the judiciary in scrutinising the factual basis of any application, and in relation to the sustainable development and public interest tests? The above-mentioned requirement of detail in the prescribed form of application, and the fact that Scottish ministers must invite views from interested parties, go some of the way to addressing scrutiny in general, but (at para 53) Lord Gill goes on to identify a third means of scrutiny. Section 81 gives any interested party, including the landowner, the right to refer any question relating to the application to the Scottish Land Court.

Curiously, both parties submitted that the role of that court should be limited. A limited role for such a scrutinising body would improve the appellants’ chances of establishing a breach of ECHR rights, but that approach is criticised by Lord Malcolm as being paradoxical in terms of s 3 of the Human Rights Act 1998, which requires ECHR-compliant construction (para 99). For their part, it seems the ministers were concerned at the possibility that policy decisions (in relation to sustainable development or public interest) might somehow be usurped by a judicial body.

The Inner House set its own course, affirming that the Land Court’s role was important and that as a specialist tribunal it could be trusted for this role (paras 76 and 101), while at the same time meeting any landowner concerns regarding inadequate scrutiny by providing a “curative jurisdiction” under article 6 (para 78; see also para 102). This clarifies that the Land Court has a broad remit even in relation to the things the ministers sought to guard jealously.

As noted in the various opinions, issues of sustainable development and public interest have already been ceded to the judiciary across the 2003 Act. For example, a sheriff might consider these matters on the activation of a community right to buy in terms of part 2 (paras 75 and 97). Further, the Land Court already has a specific role as referee of sustainable development in the crofting community right to buy, namely where a community seeks to buy eligible additional land but the landowner does not consent to a sale (s 77(3)(b): discussed at paras 59 and 101).

The mention of part 2 of the Act gives scope for a valuable comparison. The pre-emptive community right to buy is only activated when a landowner seeks to transfer land subject to a registered community interest. Lord Malcolm highlights that under part 2, the judiciary can only play a role after a decision by ministers, whereas under part 3, the Land Court has a varied and extensive “pre-decision jurisdiction” (para 98). This, he rationalises, can be explained by the part 2 pre-emption only coming into effect when the landowner opts to sell, so any extensive inquiry before that stage may be a largely hollow exercise. In contrast, part 3 can operate with far less reference to the landowner’s wishes and actions. On that basis, the involvement of a specialist judicial body, “at least if and when any interested party so wished”, is a key part of making part 3 ECHR-compliant.

This leads on to a very important point for practitioners advising anyone faced with a crofting community buyout, namely that it is crucial to get involved before a ministerial decision is made. Lord Malcolm acknowledges this may be a little unorthodox, but it does not lead to a problem in terms of ECHR compliance: “While the opportunity afforded by s 81 for access to the Land Court on ‘any question relating to the application’ before the decision is taken may well be unusual, it renders otiose much of the discussion on the sufficiency of the review offered by s 91” (para 110). Recalling the experience at Kinghorn (Hazle v Lord Advocate, Kirkcaldy Sheriff Court (ref B270/07), 16 March 2009), the landowner had some success in deconstructing a ministerial decision after the fact, but waiting until what might have been thought of as the comparator stage of a crofting community bid can now be characterised as too late. Scrutiny of the crofting right to buy is more front than back-ended.

With the margin of appreciation afforded to a state by Strasbourg jurisprudence, the author and others have noted that any broad challenge to Scottish Parliament legislation on A1P1 grounds runs the danger of being too bold to have a realistic chance of success (Combe, “Parts 2 and 3 of the Land Reform (Scotland) Act 2003: A Definitive Answer to the Scottish Land Question?” 2006 JR 195 at 210; Steven, “Property Law and Human Rights” 2005 JR 293 at 309). Assuming no Supreme Court appeal is forthcoming, the matter has now returned to Stornoway Sheriff Court. Section 91 restricts the sheriff’s remit to a question of law (with the possibility of a further judicial review, as acknowledged at para 110). Not wishing to prejudge that or any other issues, what is now clear is that the Pairc Trust and other crofting communities can have confidence in the crofting community right to buy, subject to their compliance with the legislative scheme. For their part, crofting landowners now know how, or at least when, to make representations about a buyout proposal.

What does this mean for future crofting bids? Arguably, not very much. There is something of a trend towards consensual sale in the shadow of the crofting community right to buy. Pairc is an exception, in that it is the only hostile bid where litigation has ensued. In fact, the only foreseeable part 3 bid(s) will be in Pairc, if and when the community aims to acquire further land. The community was perhaps cognisant of the landowner’s desire to carefully hold it to the terms of the Act, so it chose to save any other potential points of contention for another day. While that limited opening gambit might have been prudent, the landowner might well invoke the Land Court’s now clarified role as adjudicator in any future application so as not to allow Scottish ministerial approval to slip through for anything else.

The reaction of the Pairc Trust has been suitably guarded. The Stornoway Gazette (20 December 2012) reported a spokesperson’s statement that there is “still a long way to go”, and reaffirming the community’s preference for a consensual sale. Without a consensual sale, at least one step along the way will be an independent valuation, which has been on the back burner for some time.

So the deer drive continues. The Court of Session judgment has provided some momentum, and the Land Reform Review Group (see www.landreformreview.org) should perhaps take note. I have not mentioned that Scottish Government-appointed group until now, as it is not in any way involved in the case. Its call for evidence closed to respondents on 11 January 2013. Landowners, crofters and many others will be watching its progress carefully.

Malcolm Combe, lecturer in law, School of Law, University of Aberdeen

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