DIVISIONAL COURT

(Mr D J Houston)

PENTLAND ROAD WINDFARM LIMITED v CROFTERS HAVING RIGHTS IN COMMON GRAZINGS OF TOWNSHIP OF KNOCK & SWORDALE & OTHERS

(Application RN 138/11 – Order of 18 January 2012)

CROFTING – COMMON GRAZINGS – SCHEME FOR DEVELOPMENT – SECTION 19A CROFTERS (SCOTLAND) ACT 1993 – PROCEDURE – FORM OF APPLICATION – INFORMATION TO BE PROVIDED BY APPLICANT – REASONS FOR CONSENT

A developer applied for the Court’s consent in terms of sec 19A of the 1993 Act to a scheme for development of a wind farm extending over a large area which involved four separate common grazings and over 600 grazings shareholders. The application was advertised and no objections were made. In granting the order sought, the Court made observations regarding the procedure for and timing of public notification of the application and about the material to be provided with the application and how it should be presented. The Court outlined its reasons for giving consent.

The Note appended to the Court’s order is as follows:

[1] In this application, Pentland Road Wind Farm Limited, with the consent of the landlords, The Stornoway Trust, seeks the Court’s consent, in terms of section 19A(1)(a) of the Crofters (Scotland) Act 1993 to an area of land extending to 101.5 hectares of the common grazings of the townships of Knock & Swordale, Sheshader, Stornoway General and New Valley, Guershader & Laxdale Lane, Stornoway being developed in accordance with a scheme known as the Pentland Road Wind Farm.

[2] Although section 19A(6) appears to envisage public notification at the time the application is lodged with the Court, it was in fact effected following our initial scrutiny of it. It would seem to us to be an efficient use of the resources of applicants, the Court and potential objectors that applications be lodged prior to public notification under sub-section (6). There would be little sense in public notification of an application which was not appropriate in form or content. Equally there would be no merit in notification of an application where it appeared to the Court that either (a) there was insufficient material for potential objectors to be properly informed as to the purpose and potential impact of the scheme or (b) even in the absence of objection, consent was likely to be withheld by us in respect of the application as lodged. We have adopted this approach in an earlier application and propose to continue to do so.

[3] Comprehensive details of the scheme were lodged with the application and following our initial scrutiny of the documentation, we were satisfied in terms of sections 19A(4) and (5), that the application and the appended scheme were sufficient in both form and content. They appeared to satisfy the preliminary requirements suggested at paragraph [2] above. Accordingly public notification was duly given and no objections have been received from either the Crofters Commission or any other interested party. On the basis of all the material in front of us, we are satisfied as to all the matters listed under section 19(A)(2). Accordingly, we will dispose of the case by way of our giving consent under the section. However, we note the terms of section 19(A)(9) and accordingly set out briefly below the reasons for such disposal.

[4] Before doing so, however, we would point out that this is one of the first applications for consent under section 19A which the Court has had to deal with. We have given our consent without hearing any submissions as to the proper approach to be taken in such applications. We have regarded the “scheme” as comprising the document dated July 2011 and entitled “Application under Section 19A of the Crofters (Scotland) Act 1993 for a Scheme for Development” together with the ten Annexes appended to it. In future cases, applicants are advised to make clear what material comprises the “scheme” in terms of the section.

[5] Perhaps more importantly, we experienced some difficulty in assessing precisely what rights the shareholders in the affected common grazings were expected to give up. That is important for two reasons. Firstly, following intimation, it facilitates assessment by relevant parties of potential affects of the development on them and the question of whether to object on any of the grounds listed. Secondly, once a copy of the scheme has been entered into the Register of Crofts in terms of section 19A(10), it becomes binding on several parties, including – under section 19A(11)(c)(ii) – “a holder of grazing rights”. We therefore consider that future applications for consent to a scheme should set out more clearly the particular terms of it as they apply to the various persons listed in at (a) to (d) of the subsection. In the present case, it is tolerably clear from perusal of the documentation – in particular the Draft Option Agreement and Lease – what elements of the proposed agreement between the Stornoway Trust and Pentland Road Windfarm Limited affect the present rights of shareholders in the affected grazings. However, it would have been better if the relevant terms had been specifically listed or highlighted.

[6] We return now to an outline of the reasons for our disposal.

[7] In terms of section 19A(2)(a), it can be noted that “the generation of energy” is specifically included as a “reasonable purpose” at section 20(3)(viiia).

[8] As regards section 19A(2)(b) we can see no obvious basis which might suggest that the carrying out of the development would be unfair to any members of the crofting community in the area affected by it. Had there been any suggestion of unfairness, we might have expected it to have been drawn to our attention by way of an objection under ground (b) of section 19(A)(8).

[9] Similarly, if there had been a view that the scheme did not provide for fair recompense to affected members of the crofting community, we might have expected an objection under ground (c) of section 19(A)8. Although what is meant by “the value of the development” in section 19(A)(3)(c) is not spelled out, it appears to us that there is provision in the scheme for such members to be fairly recompensed for any negative effects of the development under and in terms of section 19A(2)(c). Clearly there will be some disruption in the area during the construction phase of the development which, in terms of section 19A(3)(d), is likely to affect more than the crofting interest. No doubt there will be some negative effects throughout the lifetime of the development. However, the project has planning approval and the scheme provides for significant payments to the community.

[10] Although section 19A(2)(c) talks of equivalence to resumption in relation to croft land, we think that it is appropriate, in relation to common grazing, for us to attempt to compare the proposed terms of the scheme with such payments as might have been forthcoming had the development been the subject of a resumption application. Insofar as payments under section 20 (compensation) and section 21 (share in development value) can be regarded as recompense and having regard to paragraph 5 of the statement of facts and the supporting documentation, we are satisfied that the proposals under the scheme meet the requirements of the section.

[11] Again, having regard to the terms of paragraph 6 of the statement of facts and the associated productions, it seems plain that, in terms of section 19A(2)(d), the crofting community is likely to benefit financially if the development goes ahead. If this application had not been under and in terms of section 19A, it is implicit that it would have had to proceed under section 20 or possibly section 5(3) or some combination of the two. It seems to us that the financial benefit to the crofting community proposed under the scheme would essentially be the same had such other route been taken. Put another way, it is not obvious that the financial benefit to the crofting community would have been enhanced in any way by virtue of the development proceeding other than under section 19A.

[12] In this connection, we think it appropriate to note that we had an initial concern regarding the proposed allocation of the total financial benefit expected to accrue to the shareholders in the Knock and Swordale common grazings. We noted that the list in Annex VII (production 6) showing the financial benefit which each shareholder in the Knock and Swordale common grazings might expect showed nil amounts against the tenants of certain crofts. This was inconsistent with the statement in paragraph 4.3 of the Statement of Facts that the crofters occupying 4B Knock, 14 Swordale and 12A Knock, together with the tenants of nine other crofts holding apportionments within the Knock and Swordale township had applied, or intended to apply, to the Crofters Commission to have their apportionments “reversed” so that they were subsumed back into the Knock & Swordale Common Grazings.

[13] Copies of the orders issued by the Crofters Commission bringing the apportionments in question to an end have however now been lodged in process. The termination of the apportionments has resulted in a re-calculation of the financial benefit which each shareholder in the Knock and Swordale common grazings can expect and a revised list of such benefits has also been lodged in process as production 20. Those crofters whose apportionments have been brought to an end are now shown as being entitled to a share of the total sum, and the amounts due to the other crofters have consequently been reduced. It is for this reason that we have incorporated a reference to the revised list in our Order.

[14] Although the reduction in financial benefit to the other crofters is significant, we are satisfied that the potential for such reduction was clear enough at the time the application was lodged. Accordingly, had any of those other crofters had concerns in that regard, they could have objected to the application in response to our Order of 9 August 2011.

[15] In all the circumstances therefore we consider it appropriate that we consent to the land being developed in accordance with the scheme appended to this application. We shall advise the Crofters Commission of our determination in order that they may enter a copy of the scheme in the Register of Crofts in terms of section 19A(10). We also consider that, given the significance of the Scheme to the local community, it is appropriate that there should be public notification of the granting of our consent, by way of advertisement in the local press.

For the applicants: Anderson Strathern LLP, Edinburgh