THE COURT

(Sheriff MacLeod, Mr A Macdonald)

BAIN v CROFTING COMMISSION

(Applications RN SLC 164 & 165/12 – Order of 13 November 2013)

CROFTING - APPEAL AGAINST DECISION OF CROFTING COMMISSION TO REFUSE CONSENT TO ASSIGNATIONS OF CROFTS - ALLEGED BREACH OF NATURAL JUSTICE - FAILURE TO GIVE ADEQUATE REASONS FOR DECISION - ALLEGED BREACH OF ASSIGNEE’S ECHR ARTICLE 1 RIGHTS

Two brothers applied to the Crofting Commission for consent, under sec 8 of the Crofters (Scotland) Act 1993, to assign their crofts at North Erradale, Gairloch, to an assignee who had worked the crofts for 20 years and held formal sub-leases of the them since 2006. The Commission having refused the applications, appeal was taken on a number of grounds under sec 52A(3)(c) of the Act; viz (1) that the respondents had acted in breach of natural justice; (2) that they had erred in law by failing to given an adequate Statement of Reasons; (3) that they had failed to take into account certain relevant and material matters; (4) that they had made findings-in-fact material to their decision without having sufficient evidence on which to base them; and (5) that they had exercised their discretion in an unreasonable fashion. The manner in which it was said that the respondents had breached natural justice was that one of the co-landlords of the crofts was employed by the respondents and that there was, therefore, a risk of bias in the handling of the applications, the landlords having opposed consent.

HELD appeal sustained and cases remitted to the respondents for re-consideration. It had not been shown that there was risk of bias in the respondents’ employment of one of the landlords, such as justified interfering with the decision. A fair-minded and informed observer, such as postulated in Porter v Magill [2002] 2 AC 357, would not have thought that the employment of the co-landlord by the respondents in and of itself gave rise to a real possibility of bias and the facts of the case showed that there was no real possibility of actual bias. However the respondents had failed to give adequate reasons for their decision, in particular failing to explain how they had carried out the relevant balancing act in respect of the various considerations bearing on their decision; had failed to take adequate account of the effect of their decision on the assignee’s crofting operations (which failure amounted to a breach of his ECHR Article 1 rights) and consequently on the interests of the crofting community in the locality and the sustainable development of that community which were considerations the respondents were obliged to consider in terms of sec 58A(7) of the Act: had had insufficient regard to their policy on “Promoting Occupancy” and had failed to consider whether the demand for crofts could have been satisfied by the freeing up of tenancies of other crofts which were not being worked. Although it could not be said that the respondents had exercised their discretion in an unreasonable manner the cases required to be remitted to the respondents for re-consideration in light of the grounds of appeal which had been sustained.

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

[1] This note covers two appeals, application SLC/164/12 and application SLC/165/12, against decisions of the respondents to refuse consent to the assignation of two croft tenancies at North Erradale, Gairloch, in terms of sec 8(1) of the Crofters (Scotland) Act 1993 (“the Act”).

Factual background

[2] Osgood John Bain and George D Bain are brothers. Osgood is the tenant of croft number 1 North Erradale, Gairloch, but lives in Ballater. George is the tenant of 9 North Erradale but lives in Somerset.

[3] On 5 March 2012 they applied to the Crofting Commission for consent to assign their respective tenancies to William Norman Fraser of 30 Big Sand, Gairloch, to whom both crofts had been sub-let since 2006.

[4] The applications having been advertised in the usual way, objections were received from Mr A C MacDonald of 31 Big Sand, Gairloch, his two sons, Eoin and Blair, and from the landlord, Mr William Cameron of Sands Estate. All of the objections were essentially to the same effect: that the tenancies should go to potential new entrants to crofting in preference to Mr Fraser, who already had an established crofting operation. The Commission considered that Eoin and Blair MacDonald were not members of the crofting community and not within the range of competent objectors set out in sec 58A(4) of the Act but their objections were among the papers subsequently considered in the processing of the applications for consent.

[5] Fiona Cameron or Gibson is a daughter of said William Cameron. She is also one of the heritable proprietors, along with her father and possibly others, of the Sands Estate. So she is one of the landlords. When the Bain brothers’ applications were being processed by the Commission she was an employee of the Commission but absent from the office on maternity leave. The fact that she was Mr Cameron’s daughter, although not necessarily the fact that she was a joint title holder, was known to the Commission because it had been raised in a previous case in which she had appeared on behalf of her father concerning 15 North Erradale.

[6] The Bain brothers’ applications were processed by Mr Grant Jones, Crofting Services Officer. On 14 June 2012 he emailed Mrs Gibson attaching a copy of a letter sent by post to Sands Estate and the applicants’ response to “your representations”. Mrs Gibson responded by email on 22 June pointing out that her father had never received the letter referred to in Mr Jones’ email, that this was not the first time that correspondence from the Commission had not been received by her father, requesting that in future letters be sent to him by email in addition to the post and attaching a response to Mr Jones’ email. In that exchange of emails Mr Jones and Mrs Gibson addressed each other by those names.

[7] On 16 and 17 September 2012 there was another exchange of emails between Mrs Gibson and Mr Grant. On 16 September Mrs Gibson emailed Mr Jones (using that name) attaching a response to a letter from the Commission dated 3 September and signing herself as “Fiona Gibson”. Mr Grant responded next day, addressing his email to “Mrs Gibson”, signing it as “Grant Jones” and saying that a copy of “your representations” would be served on the applicants and forwarded to the Reporting Officer who would be asked to comment on the information provided.

[8] On 22 October 2012 Mr Jones emailed Mrs Gibson enclosing a copy of the Commission’s decision on the applications. That email is addressed to “Fiona” and signed “Grant”.

[9] The decision to which the Commission had come was to refuse both applications. It was made by Mr William James Swann, one of the Commissioners. When making his decision Mr Swann did not know Mrs Gibson, was unaware that she worked for the Commission and unaware that she was one of the landlords.

[10] The decisions were issued on 22 October 2012. The letters to the applicants’ agents of that date included the following statement as to why the applications were being refused:-

“We have considered the evidence which clearly shows that the proposed tenant makes good use of his existing crofts. However, we are not persuaded by the argument that there is no demand for crofts in the area. Whilst Commission policy does allow an individual crofter to acquire the tenancies of multiple crofts, in our judgement, this would not be in the interests of crofting in this area. We are persuaded that there is a demand for crofts and that this is in the interests of population retention and creating opportunity for new entrants to crofting.”

These are the decisions appealed against.

[11] By letters dated 27 November 2012 the applicants’ agents wrote to the Commission with a request under sec 10(1) of the Tribunals and Inquiries Act 1992 (“the 1992 Act”) that the Commission either furnish a statement of reasons for their decisions or confirm that the reasons were as contained in their letter of 22 October. By letters dated 27 November the Commission confirmed the latter and repeated the statement of grounds contained in their letters of 22 October.

Grounds of Appeal

[12] There are five grounds of appeal:-

(1) That the respondents acted in breach of natural justice; sec 52A(3)(c) of the Act;

(2) That the respondents have erred in law by failing to give an adequate Statement of Reasons; sec 10(1) of the 1992 Act;

(3) That the respondents failed to take into account certain relevant and material considerations; sec 52A(3)(e) of the Act;

(4) That the respondents made findings-in-fact material to their decision without having sufficient evidence on which to base them; sec 52A(3)(b) of the Act; and

(5) That the respondents exercised their discretion in an unreasonable manner; sec 52A(3)(f) of the Act.

Hearing

[13] We heard the appeals at Edinburgh on 10 and 11 September 2013, when the appellants were represented by Sir Crispin Agnew of Lochnaw Q.C. and the respondents by Mr David Parratt, advocate.

Authorities

Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223
Attorney-General for New South Wales v Quin (1990) 93 ALR 39
AXA General Insurance Company Limited v Lord Advocate [2011] UKSC 46
British Car Auctions Ltd v Adams UKEAT/0159/12/M and 0347/12/M, 23 April, 2013
Calderwood v Renfrewshire Council 2004 SC 691
Davidson v Scottish Ministers (No 2) 2005 SC (HL) 7
Davie v Trustees of the Countess of Sutherland’s No 3 Settlement 2005 SLCR 137
East Northamptonshire District Council v
Secretary of State for Communities and Local Government [2012] All ER (D) 49
Fleming v Ladykirk Estates Limited decision of Scottish Land Court in case number RN SLC/62/08
Helow v Secretary of State for the Home Department 2008 SC (HL) 1
Hrvatska Elektroprivreda, d.d. v The Republic of Slovenia ICSID Case No ARB/05/24 6 May 2008
In Re. Medicaments and Related Classes of Goods (No 2) [2001] 1 WLR 700
James v United Kingdom (1986) 8 EHRR 123
Kelly v Shetland Health Board 2009 SC 248
Kingsley v United Kingdom (2001) EHRR 13
Lawal v Northern Spirit [2003] ICR 856
Leisure Inns (UK) Ltd v Perth & Kinross District Licensing Board 1991 SC 224
Luss Estate Company v Sturgeon 2006 SLCR (1) 96
Messrs W J Henderson & Sons v The Scottish Ministers decision of Scottish Land Court in case number RN/SLC/108/11, 29 May 2012
Pabla Ky v Finland App No 47221/99, 22 June 2004, unreported
Pairc Crofters Limited v The Scottish Ministers 2013 SLT 308
Porter v Magill [2002] 2 AC 357
R v Bow Street Metropolitan Stipendiary Magistrate,
Ex parte Pinochet Ugarte (No. 2) [2002] 1 AC 119
R v The Secretary of State for the Home Department Court of Appeal, 26 July, 2000
R v Devon County Council, ex parte Baker and Anr [1995] 1 All ER 73
R (Iran) & Ors v Secretary of State for the Home Department [2005] Imm AR 535
Ritchie v Aberdeen City Council 2011 SC 570
Russell v Duke of Norfolk [1949] 1 All ER 109
Shetland Islands Council v Lerwick Port Authority [2007] CSOH 5
Sinclair Roche & Temperley v Heard (No 1) [2004] IRLR 763
South Bucks District Council v Porter (No. 2) [2004] 1 WLR 1953
Stewart v Crofters Commission decision of SLC in SLC/40/11 10 April, 2013
The Rompetrol Group NV and Romania ICSID Case No ARTB/06/3 14 January 2010
Tre Traktorer Aktiebolag v Sweden (1991) EHHR 309
Wordie Property Co Ltd v Secretary of State for Scotland 1984 SLT 345

Submissions

For the appellants

(i) Breach of natural justice – sec 52A(3)(c)

[14] The Commission was a tribunal in terms of the Tribunal and Inquiries Act 1992, Schedule 1, Part 2 (Tribunals under Supervision of the Scottish Committee) No 48. It therefore required to act as a fair and impartial tribunal both under domestic law and under Article 6.1 of the European Convention for the Protection of Human Rights and Fundamental Freedoms (“ECHR”). That was reflected in sec 52A(3)(c) of the Act which required it to act in accordance with natural justice.

[15] The argument here was as to risk of bias, given Mrs Gibson’s status as an employee of the respondents and her involvement in the processing of the applications. Actual bias was not necessary and was not being alleged. The perceived risk of bias was the issue. The test was set out by Lord Hope of Craighead in Porter v Magill, supra, at para 103:-

“The question is whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased.”

[16] Lawal v Northern Spirit, supra, was relevant. It was an example of a situation in which a fair-minded and informed observer would conclude that there was a real possibility of bias. There was such a possibility where a judge was dealing with the affairs of an employee of a tribunal. A judge could not sit on a case concerning an organisation with which he had a connection: East Northamptonshire District Council v Secretary of State for Communities and Local Government, supra.

[17] Here Mrs Gibson worked in the respondents’ Policy and Occupancy Team. [This was subsequently contradicted by Mr Parratt by the Commission, who said that Mrs Gibson worked in the “Absentee” team, not the “Policy and Occupancy” team. In our decision we have taken that to be correct.] It was the team dealing with these applications. Where a tribunal was dealing with a case involving one of their employees, particularly one working in the department dealing with the relevant issues, that was enough to conclude that there was a risk of bias. The mere fact of employment was enough, even if that employment was in another department, but here the employment was in the department dealing with the applications. Mrs Gibson may have had the opportunity of speaking to staff about it and these staff might have advised the Commissioner dealing with the case and thus may have had an opportunity to influence the outcome. Staff may have been unconsciously biased in her favour. The respondents’ response that the Commissioner did not know Mrs Gibson or of her involvement in the case was not material: a fair-minded and informed observer was unlikely to know such detail. All such an observer would know was that she was employed by the Commission and that she may have had an opportunity to communicate with the staff dealing with the case, which staff would have been advising the Commissioner.

[18] The whole process was fundamentally poisoned by the fact that Commission employed someone who was one of the landlords. It was a matter of public perception. There was a risk of unconscious, or subconscious, bias. Some of the emails exchanged were on first name terms. There was a real possibility of bias in this case.

[19] Asked how the Commission could have dealt with the matter if the mere fact that Mrs Gibson was in their employment poisoned everything, Sir Crispin submitted that it could have referred the matter to this Court under sec 53 of the Act. But the fact that the situation of having to deal with a case involving an employee might cause administrative difficulties for the Commission should not deter us from upholding this ground of appeal.

[20] Lawal was looking at the systemic situation and if the position was systemically wrong one did not get as far as looking at the particular facts of the case. In Lawal Lord Steyn had said (at para 14) that public perception of the possibility of unconscious bias was the key consideration and (at para 15) that the rationale behind the rule that recorders who were also MPs or Parliamentary candidates or local councillors should not sit within their constituency or council area was the need to protect public confidence in the administration of justice. His Lordship had gone on to make the point (at para 22) that with the passage of time there had been changes in what was regarded as acceptable and what was not:

“What the public was content to accept many years ago is not necessarily acceptable in the world of today. The indispensable requirement of public confidence in the administration of justice requires higher standards today than was the case even a decade or two ago.”

[21] Reference was also made to Helow v Secretary of State for the Home Department, supra, in which Lord Hope had expanded on the attributes of the fair-minded and informed observer (at paras [1] to [3]) and Lord Rodger of Earlsferry had endorsed the legal test for bias laid down by Lord Hope in Porter (para [14]). In Helow some importance had been attached to the fact that the person who may be affected by bias was a professional judge who had sworn an oath to decide impartially (Lord Rodger of Earlsferry at para [23]). That was a feature absent from the present case: Commissioners were not professional judges and did not swear such an oath. The Court was entitled to take account of what the Commissioner said he knew at the time but was not necessarily bound to accept such a statement at face value (see what is said by Lord Mance at para [39] of Helow).

[22] R v Bow Street Metropolitan Stipendiary Magistrate and Ors, Ex parte Pinochet Ugarte (No. 2), supra, had applied the principle of automatic disqualification of a judge who was involved with one of the parties. A judge must not be a judge in his own cause. There were parallels between that situation and the situation in the present case, where the Commissioner was deciding a matter involving one of the Commission’s employees. In the Pinochet case Lady Hoffman’s role as an employee of Amnesty International had been thought relevant despite the fact that she had had no involvement with the case.

[23] Reference was also made to Davidson v Scottish Ministers (No. 2), supra, as a Scottish House of Lords decision (as, indeed, is Helow) in which the fair-minded and informed observer test had also been applied. Per Lord Hope of Craighead (at para [47]) all that was required in order to show a risk of bias was a doubt that could be objectively justified and (at para [50]) even appearances may be important. What was the appearance here where the Commission were making a decision involving one of their own staff: how would that appear to the fair-minded and informed observer?

[24] In the present case the respondents had followed a two-stage process. The first stage involved people working in the same department as that in which Mrs Gibson normally worked investigating matters and putting together what are called Casework Papers for the second stage. The second stage was consideration of these Casework Papers by a Commissioner. The risk here arose at the first stage. There was a risk that staff members would be subconsciously influenced by their knowledge of Mrs Gibson. It was said in the respondents’ Note of Argument that the person collating the paperwork at stage one also provided “his view of the legal position to the Commissioner”. In this case no legal view was expressed in the Casework Papers, so it had to be assumed that any advice given had been given orally and it was not known what that advice was. The fair-minded and informed observer would conclude that there was a risk of the Commissioner getting advice which was subconsciously biased and on which he was likely to act.

[25] After an adjournment to allow Mr Parratt to establish whether legal advice had been given in this case and what the process by which Commissioners obtained legal advice was, we were told that the case workers were not legally qualified. They prepared the papers and asked the Commissioner whether he or she had enough evidence to make a determination. The Commissioner could ask for more information. If the Commissioner required legal advice it was obtained from the Commission’s solicitors. A case worker might make mention of statutory provisions in the paperwork presented to the Commissioner but would not give the Commissioner legal advice. No legal advice had been given in this case.

[26] Sir Crispin questioned how much of that would be known to the informed observer. How could an external person get the information we had just been given?

[27] Under reference to British Car Auctions Ltd v Adams, supra, Sir Crispin submitted that, like Mr Kirby, the tribunal member at the centre of that case, the respondents here might be thought to have been hiding what they knew about Mrs Gibson. To begin with the appellants had thought that Mrs Gibson was merely the landlord’s daughter. It was now known that she was one of the landlords. That had been known to the Commission all along. Yet they had not alerted anyone to it. That was a factor to be taken into account when considering what the fair-minded and informed observer would make of it all. Reference was made to para [24] of the judgement and what was said there about Mr Kirby’s duty to disclose relevant facts at the outset.

[28] If we sustained this plea we could not remit to the Commission to reconsider matters. That would not cure a systemic problem. Instead we should treat sec 52A(4)(b) as giving us the right to re-hear these applications ourselves. That entitled us to direct the Commission to come to a different conclusion and there was no limit on the ways in which we might arrive at that conclusion. Reading the Act in that way would make it European Convention compliant. If we could not read it that way we should put the appeal out By Order so that Sir Crispin could lodge a devolution minute.

(ii) Inadequate statement of reasons

[29] Under sec 10(2) of the 1992 Act the Commission was bound to give reasons for its decision if asked. The duty to give adequate reasons was acknowledged in sec 58A(7) of the Act. The decision letter did not give adequate reasons. It did not deal with the substantial questions in issue; it did not disclose how these had been resolved and the informed reader was left in substantial doubt as to the reasons for the decision. Grounds of Appeal 3 and 4 set out some of the material factors which had been before the Commission, factors which ought to have been considered. The statement of reasons ought to have explained how account had been taken of these factors. The statute also required certain factors to be taken into account and the statement of reasons should have explained how this had been done and with what result.

[30] The statement of reasons contained in the decision letter was very brief. It set out the grounds for the decision but not the reasoning which would explain how the decision had been reached. It failed to have regard to a number of material issues which had been raised and did not include any consideration of the things which it was mandatory for the Commission to consider under sec 58A(7).

[31] The Casework Paper, production 2, referred to the need for a report from the Scottish Government Rural Payments and Inspections Directorate (“SGRPID”), asking, inter alia, if the proposed assignation would have any adverse effect on the interests or sustainability of the local crofting community. That had been the wrong question to ask. The question ought to have asked about any beneficial effect as well as any adverse effect. The Commission had thus misdirected themselves in law.

[32] There had been no consideration of the adverse effects of refusing consent to the assignation. A very active crofter with a viable operation would be losing the use of the land. What effect would that have on the interests of the crofting community and its sustainable development? That was a material factor which did not appear in the statement of reasons.

[33] The Commission had also failed to consider that crofts might become available by other means. It was said in the Casework Paper that there were only four active crofters in the township. The township is said to comprise 29 crofts although only 21 appear in the Commission’s Register of Crofts. Enforcement proceedings by the Commission against inactive crofters might result in other tenancies becoming available. The Commission had not considered this possibility.

[34] Mrs Catherine Mackenzie, the Grazings Clerk, was unaware of any current demand for crofts in North Erradale. Why had her evidence been discounted? There was no evidence as to why the evidence of the MacDonalds had been preferred to hers.

[35] There was also a failure to assess whether such demand as existed was from suitable persons. Could Eoin and Blair MacDonald realistically be assessed as people who might get tenancies? The correspondence from Eoin MacDonald, who lives and works in Glasgow, suggested he was interested only in getting “somewhere to live” (his email of 21 June 2012 to Grant Jones).

[36] Mrs Mackenzie had also stated that refusal of the applications would be regarded by the crofting community as a setback to crofting. That clearly focused the interests of the crofting community and sustainable development yet it had not been taken into account.

[37] The agents for the applicants had lodged a Supplementary Statement, responding to the objections and setting out the case for the applicants. It too raised the issue of sustainability. The applicants were entitled to know why that case had not been accepted.

[38] Leisure Inns (UK) Ltd v Perth & Kinross District Licensing Board, supra, emphasised that for every ground given for a decision there had to be adequate reasons and for these reasons there had to be an adequate basis of fact. So there must be grounds, reasons and under-pinning facts; Lord Justice-Clerk Ross at page 233.

[39] In Wordie Property Co Ltd Lord President Emslie had described the duty on the local authority as follows:-

“So far as [the statutory requirement to give reasons contained in para 11(1) of the Town and Country Planning (Inquiries Procedure) (Scotland) Rules 1964] is concerned all that requires to be said is that in order to comply with the statutory duty imposed upon him the Secretary of State must give proper and adequate reasons for his decision which deal with the substantial questions in issue in an intelligible way. The decision must, in short, leave the informed reader and the court in no real and substantial doubt as to what the reasons for it were and what were the material considerations which were taken into account in reaching it.”

[40] The substantial questions in the present case were the economic impact on Mr Fraser and on the interests of the crofting community and its sustainable development. The Commission were therefore under a duty to explain how these issues had been dealt with.

[41] In Ritchie v Aberdeen City Council, supra, it had been held that in any statement of reasons a decision-maker must identify what he considered to be the material considerations, must clearly and concisely set out his evaluation of them and must set out the essence of the reasoning leading him to his decision. That case also drew attention to the need to balance the factors in a case; opinion of Lord Justice-Clerk Gill (as he then was) at para [14]. There had been no such balancing exercise in this case, or, if there had been, no account of it was given in the statement of reasons.

[42] In South Bucks District Council v Porter (No 2), supra, at para 35,Lord Brown of Eaton-under-Heywood had summarised the authorities governing the proper approach to reasons challenges in a planning context. The following extract from that paragraph was of general relevance:-

“The reasons for a decision must be intelligible and they must be adequate. They must enable the reader to understand why the matter was decided as it was and what conclusions were reached on the ‘principal important controversial issues’, disclosing how any issue of law or fact was resolved. Reasons can be briefly stated, the degree of peculiarity required depending entirely on the nature of the issues falling for decision. The reasoning must not give rise to a substantial doubt as to whether the decision-maker erred in law, for example by misunderstanding some relevant policy or some other important matter or by failing to reach a rational decision on relevant grounds. But such an adverse inference will not readily be drawn. The reasons need refer only to the main issues in the dispute, not to every material consideration. …. Decision letters must be read in a straightforward manner, recognising that they are addressed to parties well aware of the issues involved and the arguments advanced.”

[43] It was important to distinguish between the grounds for a decision and the reasons for it. In the present case the grounds for the decision were clear but not the reasons. There was no explanation of why the Commission had chosen between two contradictory positions. There was a contradiction in the evidence as to whether demand for crofts existed. The reasoning behind the preference of the MacDonalds’ evidence on that matter was not explained. The interests of the crofting community had been put in issue but there was no explanation as to why Mr Fraser’s case in relation to these interests had been rejected. It was not explained why the Commission had arrived at its decision.

[44] Sir Crispin accepted that, in looking for reasoning, we were entitled to look at the Casework Paper. Even if that led us to consider that the MacDonalds’ evidence as to demand for crofts explained the Commission’s conclusion on that point there were other substantial matters which had been raised and which had not been addressed. In particular we were given no idea as to why the points made by Mr Fraser to the SGRPID reporter about his enterprise being jeopardised if consent was refused had been rejected. There had been evidence to suggest that other crofts might be made available to new tenants but there was no trace of this having been considered nor of what decision, if any, had been reached on the matter.

(iii) Failure to have regard to factors set out in sec 58A(7)

[45] This was linked to the preceding ground. If it could not be discerned from the statement of reasons that the statutory factors had been taken into account we should assume that they had not. The statutory factors were material factors: the statute deemed them to be so. Where statute required a factor to be taken into account, then the body concerned was required to take it into account; Associated Provincial Picture Houses Ltd v Wednesbury Corporation, supra, at 228. Here there was nothing to show that the Commission had taken account of any of the factors listed at (a) to (h) in the subsection. Paras (c) and (d) – the interests of the crofting community in the locality and the sustainable development of that crofting community – were particularly relevant. The proposed assignee was a working crofter in the community, actively involved in crofting affairs. Much of his agricultural enterprise was, however, carried out on land over which he had no security of tenure. He had had the use of crofts 1 and 9 North Erradale for the past 20 years and they comprised a main part his agricultural activity. The Commission had failed to consider the impact on that activity and on Mr Fraser’s wider contribution to the crofting community in the locality should consent be refused. There had been no balancing of what he brought to that community against what might be lost if he did not get these assignations. There had been no balancing of what he brought to the community against what the MacDonald sons could bring.

[46] SGRPID had only been asked whether the proposed assignations would have any adverse effects on the foregoing interests. That was a question only in the negative and did not represent all that required to be considered under paras (c) and (d). Both the positive and negative effects had to be considered.

[47] The Commission had also failed to take account of its own policy on promoting occupancy of crofts. That policy required the Commission to consider:-

[48] There was nothing in the decision letter to suggest that the Commission had considered these matters. In any event, in the absence of evidence of possible specific new entrants and their plans, the Respondent was not in a position to make a judgement on any positive impact they might make. The appellants had a reasonable expectation that the respondents would follow the foregoing policy unless there were material factors which might persuade them to depart from it. Where a body sought to depart from an established policy in relation to a particular person detrimental reliance on the policy was not required: consistency of treatment and equality were at stake and should be protected whether there had been reliance on the policy or not. Reference was made to Shetland Islands Council v Lerwick Port Authority at paras [151] – [160] and [165].

[49] If a public authority had a policy it was not entitled not to apply it without giving the applicant notice that it was not going to be applied and giving him an opportunity of arguing that it should be applied. Absent such notice there was a legitimate expectation in the applicant that the policy would be applied. This was the converse of the position in Calderwood v Renfrewshire Council, supra, where a local authority applied a policy but afforded applicants an opportunity to show why that policy should not apply to them.

[50] The Commission had also failed to consider that the proposed assignee had had the use of the crofts for 20 years as a main part of his agricultural business. They had failed to consider the statement made by SGRPID that without access to these crofts “Mr Fraser would have to cut back on stock numbers considerably which would jeopardise the viability of his crofting activity”. Jeopardising his crofting activity would affect the contribution Mr Fraser was able to go on making as a very active crofter and as a member of the North Erradale Grazings Committee, Clerk to the Big Sands Common Grazings, Area Assessor for the Commission and Chairman of the local branch of the Crofting Federation.

[51] Finally, the Commission had failed to take account of the fact that there was another absentee tenanted croft in the township as well as several crofts which were not worked and in respect of which enforcement proceedings could be taken under sec 26B of the Act. They had failed to consider whether any demand for crofts in the area could have been met from these crofts whilst at the same time allowing the assignation of the present crofts to Mr Fraser to proceed.

[52] Under this head Sir Crispin also presented an argument that Mr Fraser’s business was a property right under Article 1 of the First Protocol of the ECHR. This was on the basis of an amendment to the appellants’ pleadings which we had allowed in advance of the proof. Mr Fraser was not a party to the appeal but it was the appellants who were assigning their crofts to him so it was legitimate for them to raise matters which the Commission should have considered in relation to Mr Fraser. Reference was made to sec 6 of the Human Rights Act 1998. Mr Fraser’s property right was dependent on having access to the two crofts. Accordingly he should not have been deprived of these crofts except in the public interest. The public interest here was in terms of paras (c) and (d) of sec 58A(7). These had not been taken into account by the Commission. The Commission had, therefore, failed to take account of Mr Fraser’s rights under Article 1 of the First Protocol.

[53] Sir Crispin referred to Tre Traktorer Aktiebolag v Sweden, supra, which concerned the revocation of a licence to serve alcohol. The European Court of Human Rights had held that the withdrawal of the applicants’ licence to serve alcohol was a measure of control of the use of property which came under the second paragraph of Article 1 of the First Protocol although it held that Article 1 had not been breached. Reference was made to the Court’s discussion of the lawfulness, purpose and proportionality of the interference at paras 56 to 62. In the present case Mr Fraser had had a licence to occupy the crofts for the last 20 years. He was now looking for a licence to be allowed to occupy them permanently. That licence was being refused with the consequence that his licence to occupy would come to an end. That could only be done in the public interest. Here the proportionality of the interference had not been considered by the Commission.

(iv) Insufficient evidence to justify a finding in fact – sec 52A(3)(b)

[54] Firstly, there was no evidence before the Commission which entitled them to find that there was a demand for crofts in the locality. The SGRPID report recorded that Mrs Mackenzie, the Grazings Clerk for North Erradale, and Mr Fraser, as Area Assessor, were both “unaware of actual recent demand for crofts in the area”. Blair MacDonald appeared to be the only person with present interest in a crofting tenancy. Eoin MacDonald had said that he had “an interest in the crofts in this area” but he lived and worked in Glasgow and there was no evidence before the Commission that he would be able to take up a croft tenancy in the near future. Further, in due course, their father’s croft would become available to one or other of them. The evidence from the Estate was that they did not keep a list of demand for crofts on the Estate. There was therefore no material before the Commission on which they could hold demand for crofts proved.

[55] Secondly, in the absence of evidence of specific individuals who could immediately take over these crofts in place of Mr Fraser there was insufficient evidence before the Commission to allow them reasonably to conclude that refusal of the assignations was “in the interests of population retention and creating opportunities for new entrants to crofting”. Evidence as to the plans of specific potential new entrants would have to be balanced against the effect of a decision to refuse the assignations on Mr Fraser’s crofting enterprise in the context of the factors to which the Commission must have regard under sec 58A(7)

[56] Esto the Commission had based their findings on other material known only to themselves and not disclosed to the appellants, their decision would have been a breach of natural justice and would fall to be quashed on that ground.

(v) Unreasonable exercise of discretion – sec 52A(3)(f)

[57] Having regard to the points raised in Grounds of Appeal 2 to 4 ((ii) to (iv) above), the Commission had exercised its discretion unreasonably. In particular:-

(a) Failure to give adequate reasons showed that the Commission had acted unreasonably;

(b) Failure to have regard to material factors set out in sec 58A(7) and in their own policy together with failure to take account of Mr Fraser’s occupation of the crofts for the last 20 years and the effect of terminating that occupation on him and failure to take account of the possibility of other crofts becoming available to satisfy any demand was unreasonable;

(c) It was unreasonable to make a decision depriving Mr Fraser of the crofts when SGRPID recognised that this would jeopardise the viability of his crofting enterprise with the knock-on effects that could have in relation to his wider crofting involvement, particularly when other crofts might be freed up for new entrants.

(d) It was unreasonable to deprive Mr Fraser of the crofts when there was no proper evidence of actual demand for crofts before the Commission and other crofts could be freed up to meet any demand there might be.

On the evidence before them, therefore, no reasonable tribunal could have come to the decision appealed against. There was no material to balance against the evidence that Mr Fraser was a good crofter. The decision was unreasonable because it put his operation in jeopardy, something which was regarded as not being in the best interests of the crofting community by the Grazings Clerk. It was from a failure to balance the material before the Commission that the unreasonableness arose. The SGRPID report set out all the material relevant to Mr Fraser and the MacDonald brothers. Having regard to the factors to which the Commission were obliged to have regard, no reasonable tribunal would have preferred the MacDonalds to Mr Fraser.

For the respondents

[58] Mr Parratt accepted that the Commission was a tribunal under the 1992 Act. He accepted that is must not act contrary to natural justice.

[59] The whole of the Act was, however, to be viewed in the light of sec 1(2A) which emphasised the importance of supporting population retention in the crofting counties. That provision had been introduced by sec 2(1) of the Crofting Reform (Scotland) Act 2010 and had been in force when the Commission had considered these applications. That provision flavoured the whole Act. It came into play before one got to sec 58A(7). It ran through the Act like a stick of rock. It was a guiding principle in the application of the Act by the Commission. It informed consideration of the factors listed at paras (a) to (h) of sec 58A(7). The debate so far had been skewed because we had been looking only at sec 58A(7).

[60] Mr Parratt then addressed the grounds of appeal and the submissions made by Sir Crispin.

(i) Breach of natural justice

[61] It was accepted that the test was whether the fair-minded and informed observer would conclude that there was a real possibility that the tribunal was biased; Lord Hope of Craighead in Porter v Magill, supra, at p 484. It was accepted that actual bias need not be proved and that perceived bias was enough.

[62] However, in the words of Tucker LJ in Russell v Duke of Norfolk, supra, at p 118 “[t]he requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject-matter that is being dealt with, and so forth”.

[63] The factual circumstances of the case were paramount in judging whether the legal test had been met. The first step was to ascertain “all the circumstances which have a bearing on the suggestion that the judge was biased” and the second step was “to ask whether those circumstances would lead a fair-minded and informed observer to conclude that there was a real possibility … that the tribunal was biased”; per Lord Phillips of Worth Matravers MR in In Re Medicaments and Related Classes of Goods (No 2) at para 85.

[64] What the appellants averred here was an unsupported belief that the Commissioner deciding the applications “may well have known [Fiona Gibson] and that she was the landlord’s daughter and/or that she was one of the landlords” and that she “may have had the opportunity to influence the outcome of the Application(s)”; Grounds of Appeal, para 1. That was their case on record. It was not good enough. There required to be a concrete assertion of how the Commissioner’s judgement was biased or how it came to be apparently biased. There had to be some assertion of what it was about the process which made the decision unfair and biased. The fair-minded observer would have to understand the exact basis of challenge to the decision as being unfair. The nature of the possibility of bias had to be clear, because the possibility had to be, in Lord Hope’s words, a real possibility.

[65] The mere fact of Mrs Gibson being an employee did not poison everything. Nor, on the facts of the case, did her actual involvement in these applications poison the procedure followed and the decision reached. The crucial thing was what had passed between Mrs Gibson and Mr Jones. Mrs Gibson had been on maternity leave at the time and had therefore not been in and around the office on a daily basis or, indeed, at all. There was accordingly no scope for her influencing her colleagues in that way. The exchange of emails referred to above would not make the fair-minded and informed observer think there was a real possibility of bias. If this first stage of the process, which included Mr Jones’s preparation of the Casework Papers, was not tainted by bias there was no basis on which the second stage – the decision-making of the Commissioner – could be so tainted.

[66] With more particular reference to the exchange of emails, Mr Parratt prayed in aid (i) the fact that Mrs Gibson had gone on maternity leave before the exchange commenced, (ii) that the exchange merely involved an exchange of information, with Mrs Gibson acting as a post-box for her father, (iii) that the email address she had used was not her work one, and (iv) that formal modes of address were used to begin with and that by the time first name terms came to be used the decision had been made. Mrs Gibson had enclosed production 6 – a letter from her father responding to the draft Casework Paper – with one of her emails but she had merely been forwarding that on her father’s behalf. Mr Parratt took us through the emails and submitted that they were innocuous.

[67] The appellants appeared to be relying on the possibility that the Commissioner might have been unconsciously influenced by the fact that Mrs Gibson was an employee. But if in fact he did not know who she was and would have made disclosure had he known, that went a long way towards answering the allegation of apparent bias. Even if the appellants could set up a case of perceived bias involving Mr Jones, where the Commissioner was acting in a quasi-judicial capacity and discharging a ministerial function could he be said to have been influenced or biased as a result of the paperwork collated by the case officer? Commissioners were under a duty to declare interests; para 14 of Schedule 1 of the Act. There was a procedure for doing so. For what it was worth, the fact that a person was a crofter or a landlord was not an interest which debarred him from being appointed a Commissioner; para 4(4) of said Schedule. This was not a case in which the Commissioner could have considered whether to recuse himself: he did not know Mrs Gibson personally and did not know that she was an employee of the Commission.

[68] The facts of the present case, so far as Mrs Gibson was concerned, were that she was employed by the Commission, that she was the daughter of William Cameron of Sands Estate, that she had become a co-landlord in or around June 2010, that she worked not in the Commission’s Policy and Occupancy Team but in the Absentee Team, that she did not therefore work in the same team as Grant Jones, nor have day to day dealings with him, and that she had been on maternity leave when the applications were being processed, having commenced maternity leave on 18 May 2012. Since that date she had had no day to day contact with the Commission nor with any employee of the Commission. She had resigned from her employment in July 2013. She had not sought to influence Mr Jones in the processing of these applications nor had he in fact been influenced by her. The material presented by Mr Jones had also been made available to the appellants. They had not taken issue with it.

[69] A court examining a question of bias would take account of the fears of the complainer – of how things might look from the complainer’s point of view – but these fears lost their importance once the stage of looking at the matter objectively was reached. The question was whether the complainer’s fears were objectively justified; Lord Hope in Porter v Magill at para 104.

[70] As had been observed by Lord Bingham in Davidson v Scottish Ministers, supra, (at para [17]) it was difficult, if not impossible, to lay down hard-edged rules to distinguish a case where apparent bias might be found from one where it might not. Therefore much turned on the facts of the case.

[71] An allegation that a minister of the Crown had prejudged or appeared to have prejudged an application made to him in a quasi-judicial capacity was a grave one and it would not be upheld unless there was evidence of corresponding gravity to support it: R v Secretary of State for the Home Department, supra, at para 48. The Commissioner in this case had been in a similar position to a Minister of the Crown and the allegation in this case was a grave one.

[72] The Commission was a specialist body. Such bodies were capable of taking a professional approach; Sinclair Roche & Temperley v Heard (No 1) at para 46.6. The fair-minded and informed observer was neither unduly sensitive nor unduly suspicious; per Lord Rodger in Helow v Secretary of State for the Home Department, supra, at para [14].

[73] For the appellants to succeed on this ground they had to demonstrate a real possibility of bias. The question for us was whether any possibility of bias here was real or fanciful. Our duty was to examine the information put before us and assess its consequences; Davidson v Scottish Ministers, supra, per Lord Hope at para [46].

[74] In summary, what emerged from the authorities was this:-

(a) The test for apparent bias was a high one.

(b) There must be a real and reasonable possibility of bias, not just a fanciful one.

(c) The taking of a judicial oath was an important factor but was not determinative.

It all depended on the facts and circumstances of the case.

(d) The fair-minded observer was not unduly sensitive or suspicious.

(e) The court should not conduct a search for apparent bias at the instance of an unsuccessful litigant.

(f) Where a tribunal was dealing with a case in which one of the parties had an interest that of itself would not necessarily lead to a conclusion of apparent bias.

[75] Mr Parratt commented on the authorities cited by Sir Crispin. His principal point was that none of them was on all fours with the present case. Only matters of principle could be derived from cases in this area, since each case was so dependent on its own facts. What one had to do was apply these principles to the facts of the particular case. Argument by analogy was unhelpful.

[76] More helpful on their facts than any of the foregoing cases were two decisions of the International Court for the Settlement of Investment Disputes: Hrvatska Elektroprivreda, d.d. v The Republic of Slovenia and The Rompetrol Group NV and Romania, supra. We were one step away from the situation in Hrvatska because in this case Mrs Gibson had not been making representations to the Commission, as would have been the case had Mr Milden Q C been allowed to participate before the Tribunal in that case. The Rompetrol case had involved counsel and a member of the tribunal who had previously worked with the same law firm. The comparison in this case would be with Mrs Gibson and Mr Jones. But if Mr Jones’s role was confined to ingathering information without “pushing any buttons” it was again obviously a very different role from that which counsel would be performing in the Rompetrol case.

(ii) Inadequate statement of reasons

[77] Mr Parratt accepted that under sec 10(2) of the 1992 Act the Commission, as a tribunal, had to give reasons for their decisions. However, in this case they had done so.

[78] In terms of the test set out in Wordie Property Co v Secretary of State for Scotland, supra, the informed reader was not left in any real or substantial doubt as to what the reasons for the decision were. Intelligible and adequate reasons had to be given but they could be shortly and succinctly stated (Kelly v Shetland Health Board, supra). There was no requirement to deal with every single point: it was sufficient that the main issues were referred to in the decision letter; South Bucks District Council v Porter (No 2), per Lord Brown of Eaton under Heywood supra. Reference was made to the following passage from the judgement of the Lord Justice-Clerk in Ritchie, supra:-

“The decision-maker, having taken a particular consideration into account, may in the event decide that other considerations outweigh it. Such a consideration, being thus outweighed, is not a determining consideration; but it is material nonetheless because it has formed part of the decision-making process. In fulfilling his duty to give proper and adequate reasons, the decision-maker need not engage in an elaborate and detailed evaluation of each and every point that has arisen at the hearing. But his statement of reasons must identify what he decided to be the material considerations; must clearly and concisely set out his evaluation of them; and must set out the essence of the reasoning that has led him to his decision.”

The foregoing was what the Commission had done in this case.

[79] The Commission were bound to exercise their discretion in accordance with the requirements of statute and to take account of statutory principles and statutory factors. The submission for the appellants was that the Commission had given the grounds for its decision not the reasons, but that was not the case. The grounds were enshrined in statute, at sec 58A(7). These were the only grounds to which the Commission should have regard and they had to be applied in the light of the principles contained in sec 1(2A). From that it followed that the explanation contained in the decision letter was, in fact, the giving of reasons, not the statement of grounds. It explained the Commission’s consideration of the grounds.

[80] Asked as to whether there was enough in the decision letter to identify the main issues and explain how they had been evaluated, in accordance with the guidance from Ritchie, Mr Parratt submitted that the decision letter had to be read against the background of the statutory grounds. The principles of sec 1(2A) must also be taken into account. The material issues were subsumed in the statutory factors to be considered. Asked what issues were identified in the decision letter, Mr Parratt pointed out that demand for crofts was one. The Commission had decided that there was a demand for crofts. They were entitled to do that. The decision letter also referred to a policy which allowed individual crofters to acquire several tenancies. That showed that the policy had been considered but not applied in this case. That showed that there must have been a processing of reasoning in order to come to that decision. The reference in the statement of reasons to being “persuaded”showed that there must have been a process of considering the Casework Papers and the statutory factors to be taken into account, followed by a reasoning process leading to a decision. If we were of the view that what was required was a reference to the competing positions on the material issues and then an explanation of why one had been preferred to the other, then the statement of reasons was inadequate. The “because” part was not there but it was not required. The Commission were not required to go that far. The Casework Papers had been made available to parties and they must be held to have been aware of the statutory grounds for refusal; at all events the statutory provisions were available to them. Read together the informed reader would not have been in doubt as aforesaid. There was a spectrum of reason-giving, ranging from arbitral awards running to 50 pages of reasoning, on the one hand, to the minimum necessary, on the other. The decision letter here was towards the minimum end of the spectrum but it was enough: it got over the hurdle of legal adequacy.

(iii) Failure to have factors contained in sec 58A(7) and unreasonable exercise of discretion

[81] Mr Parratt took these two grounds together.

[82] It was accepted that the Commission had to have regard to the factors prescribed in sec 58A(7). But the failure to mention a particular factor in the statement of reasons did not mean that it had not been considered or taken into account. Thus in the present case there was no reference to whether the assignee was ordinarily resident within 32 km of the croft (sec 58A(7)(a)(i)), or to whether the croft would be cultivated (sec 58A(7)(a)(ii)) or to the objections received (sec 58A(7)(f)). There was no need to mention these matters but it would be obvious to the applicants and the proposed assignee that these factors had been taken account of. The appellants were arguing this the wrong way round. The question was what was required in terms of adequate reasons.

[83] The Commission was exercising a statutory discretion. The Court was entitled to assess their exercise of it against the test of Wednesbury unreasonableness (Associated Provincial Picture Houses v Wednesbury Corp., supra). The Commission must have acted in an unreasonable manner before this ground of appeal could be upheld.

[84] It was not necessary for a tribunal to recite every piece of evidence in order to avoid the inference that something relevant had been left out of account; R (Iran) and Ors v Secretary of State for the Home Department, supra, at para 13 to 15.

[85] An appellate court should not overturn a judgement at first instance unless it could not understand the judge’s thought processes. It was not necessary to specify which grounds in sec 58A(7) the Commission was founding upon as long as the informed reader could identify the reasons that were being founded upon. The decision letter explained that the Commission had refused consent having “fully considered the evidence shown in the case paper forwarded … in September 2012” and “subsequent correspondence”. It explained that, having done so, they were not persuaded that there was no demand for crofts as submitted by the applicants. It was clear that they had carried out a balancing exercise; hence the reference to being “not persuaded”. The Commission acknowledged its own policy permitting a crofter to acquire multiple tenancies and in the exercise of their discretion they had decided that, in the circumstances of this case, this “would not be in the interests of crofting in this township”. They continued to explain their reasons by saying that they were persuaded that there was demand for crofts and that giving effect to that finding was “in the interests of population retention and creating opportunity for new entrants into crofting”.

[86] The Commission had therefore had regard to the considerations contained in sec 58A(7) and to their own policy and had considered, in the exercise of their discretion, that consent should not be granted. They did not require to state the particular statutory provisions being founded upon: it was obvious that they were founding on the considerations set out in paras (c), (d) and (e) of sec 58A(7).

[87] Mr Parratt emphasised again the role of sec 1(2A)(a) in setting the context for the Commission’s decision-making. The principle of population retention contained therein had obviously been considered by the Commission in coming to its decision.

[88] Mr Parratt accepted that, if we were to hold that the reasons were inadequate we should remit to the Commission to hear the applications anew. Sir Crispin agreed.

(iv) Legitimate expectation

[89] It was for the appellants to show that they had a legitimate expectation, what it was an expectation of, and that they had been deprived of it by the Commission. Such a plea would not be sustained except in very clear circumstances. It required to be very clearly focused in the pleadings and grounds of appeal. It required a close examination of specific facts and circumstances, the clearest possible averments of detail and the factual basis on which it was being advanced; Messrs W J Henderson & Sons v The Scottish Ministers, supra, at para [104].

[90] None of that had been done in this case. The result was that it was difficult to see what legitimate expectation was being relied upon. This ground of appeal and supporting averments were lacking in specification.

[91] The substantive legal, as distinct from pleading, requirements for the plea were also missing. These were a clear and unambiguous representation and reliance on it by the recipient to his detriment; Shetland Islands Council v Lerwick Port Authority, supra, at para [151] to [170]. Moreover its application to issues of procedure was rare. Characterising the duty to act fairly as a matter of legitimate expectation added nothing to it; Attorney-General for New South Wales v Quin, supra, adopted by Simon Brown LJ in R v Devon County Council, supra, at page 89. The extent of the applicants’ legitimate expectation in this case was that, in coming to their determination, the Commission would follow their own procedure, observe the statutory requirements and take account of relevant policies; Stewart v Crofters Commission, supra, at para [48].

[92] In any event, in relation to the policy document referred to by Sir Crispin, the Commission had in fact taken it into account. The fact of coming to a decision adverse to the applicants did not mean that the Commission had not considered the policy. The policy was but one factor the Commission had to consider. They were not bound by it. They were exercising a discretion. Nothing in the policy could give rise to a legitimate expectation of the sort contended for by the appellants.

[93] The policy referred to had to be construed as a whole. The Commission required to have regard to it in its entirety. Active land use and sharing of management were also fundamental parts of that policy. The policy assumed that the encouragement of new tenants into crofting would promote active land use and shared management. The Commission had had the requisite regard to the whole policy, including these aspects as well as the aspects relied upon by the appellants.

(v) ECHR Article 1 Protocol 1

[94] Any submissions under this head relating to Mr Fraser were irrelevant because he was not a party to the appeal. In any event the 1993 Act was Convention compliant. It contained adequate safeguards for the rights of parties. The Commission were required by the legislation to act fairly, reasonably, impartially and not contrary to natural justice. The Act required them to exercise their discretion consistently with the applicants’ Convention rights. They also required to act in the public interest, which entailed them balancing harm to the applicants against benefit to the wider public. The weight to be attached to these considerations was pre-eminently a matter for them; Pairc Crofters Ltd v The Scottish Ministers, supra, at para [40]. The important thing was the existence of adequate statutory safeguards; per the Lord President in Pairc at paras [43] and [53]. Article 1, Protocol 1 required only that any assessment of the public interest was not manifestly unreasonable; Axa General Insurance, Petitioners, supra, para [125]. The onus was on the appellants to show that there were insufficient statutory safeguards; Luss Estates Co v Sturgeon and Davie v Trustees of the Countess of Sutherland’s No 3 Settlement, supra.

[95] Where the property rights of individuals were being interfered with a fair balance had to be struck between the protection of these rights and the public interest. There had to be proportionality as between the aims of the interference and its impact on the individual. However the Act enjoyed a wide margin of appreciation, so Parliament’s assessment of proportionality must be respected unless it was without a reasonable basis; Fleming v Ladykirk Estates Ltd, supra, at paras [51] to [55]. It was not the policy of the legislation that once certain criteria were fulfilled the interest of a crofting tenant or proposed assignee would be expropriated or that such expropriation was automatically justified in the public interest; James v UK, supra.

[96] In the present case the Act itself was compliant with Article 1, Protocol 1 of the Convention, the Commission had followed the statutory procedures correctly and had appropriately balanced the competing rights of the applicants and Mr Fraser, on the one hand, and the public interest, on the other.

[97] Although in the Tre Traktorer case the European Court of Human Rights had held that Article 1, Protocol 1 had been engaged, it had held that there had been no breach of that provision. Kingsley v United Kingdom, supra, was a case involving the Gaming Board, like the Commission as statutory body, but any entitlement enjoyed was not to be vindicated by this court because Mr Fraser was not a party to the appeals.

(vi) Insufficient evidence to justify findings in fact

[98] All that was said under this head was that the Commission’s decision stood or fell on the basis of the facts found to be established by the Commission.

(vii) Unreasonable exercise of discretion

[99] Mr Parratt commented on each of the paragraphs set out in Ground of Appeal 5.

[100] The Commission had given adequate reasons for its decision. It could not therefore be said that failure to give adequate reasons showed that they had acted unreasonably.

[101] Even if the Commission were obliged to have regard to Mr Fraser’s interests as part of a balancing exercise under sec 58A(7), his interests were not a matter for this court in these appeals because he was not a party to the appeals.

[102] As well as Mr Fraser’s interests, the Commission required to have regard to other interests and to the effect of new crofters being allowed in, all as part of the foresaid balancing exercise. The focus could not be exclusively on Mr Fraser and the effect of the Commission’s decision on him.

[103] In response to the argument that it was unreasonable to make a decision depriving Mr Fraser of the two crofts he had occupied for 20 years when there was no proper evidence of demand for crofts, Mr Parratt submitted that there had been evidence of demand before the Commission. That was in the form of the letters from the MacDonald brothers.

(viii) Submission re disposal

[104] A decision that the Land Court should re-hear the applications would require a finding of bias. Otherwise it was for the Court to decide which of the disposals contained in sec 52A(4) was appropriate. Should we decide to remit to the Commission the applications could be decided by a different Commissioner or by Mr Swann and an additional Commissioner. Such a course would be Convention compliant. Reference was made to the cases of Sinclair Roche & Temperley v Heard (No 1) and Kelly v Shetland Health Board, supra. The former listed, at para 46, six matters which should be taken into account when deciding on a remit

Reply by Sir Crispin

[105] Sir Crispin was in agreement with Mr Parratt on all issues of principle. His position was that the Commission had failed to carry out a balancing exercise in relation to the jeopardisation of Mr Fraser’s business, should consent be refused, and the benefit of having two new crofters. The Casework papers highlighted jeopardy to his entire business. It had been raised in the SGRPID report and by Mrs MacKenzie. His business was a possession and therefore Mr Fraser’s Article 1 Protocol 1 rights had been engaged. The balancing exercise should, therefore, have been carried out not only as a matter of UK domestic law but because these rights were engaged. There was no reference to this having been done in the papers. The Commission were under a duty to act in a Convention-compatible way; sec 6 of the Human Rights Act 1998. So far as Mr Fraser not being a party to the appeal was concerned, he had been a party to the applications for Commission consent to the assignations and the appellants were therefore entitled to raise matters affecting Mr Fraser. For example, if the Commission had argued that he was an unsuitable assignee, the appellants would have been entitled to argue that he was suitable.

[106] Sir Crispin made a number of miscellaneous points.

(i) The decision here was a decision of the Commission, albeit it had been taken by a single Commissioner and not by the full board.

(ii) On a Lawal approach, as a matter of public policy, one should never have the situation in which an employee of a tribunal appears as an advocate, or equivalent. That was a situation about which one would say “That should never happen”. That test could be applied to the present case. We did not know what conversations might have taken place. The informed observer would similarly not know. For example, Fiona Gibson might have mentioned to the Commissioner that the Commission had a policy of encouraging new entrants. Public perception of the risk of unconscious bias was the key. Although public confidence had not been mentioned in the Porter case, it had come up time after time thereafter.

(iii) The Hrvatska case provided significant support for the appellants. It set up a triangle. What was objectionable in that case was the connection between the advocate and the chair of the arbiters. The connection between Mrs Gibson and the Commissioner was similar, but stronger.

(iv) The present case was also a fortiori of the Rompetrol case, in as much as in that case the association between the advocate and arbiter had been in the past whilst in the present case the relationship was current at the time of decision-making.

(v) With reference to the requirement for reasons, in a situation in which it was surprising that the Commission had gone against what had been said by the SGRPID reporter and the Grazings Clerk there was a duty on them to explain their decision more fully.

(vi) Leisure Inns was an example of a decision being made without a basis in fact. The decision there had merely stated the ground on which the application was refused without any findings-in-fact to support it.

(vii) The South Bucks case said that a statement of reasons had to deal with the main contentious issues in the case. The main issue in the present case – the balancing of jeopardy to Mr Fraser’s business and the benefit of new crofters – was not dealt with at all in the statement of reasons

(viii) Finally, with reference to legitimate expectation and what had been done in Henderson, in that case the appellants had tried to found a legitimate expectation argument on a few vague facts whereas here it was founded on reference to a detailed policy provision on the Commission’s website. That provision gave rise to a legitimate expectation that the Commission would consider whether the introduction of new tenants would have a positive impact on the sustainable development of the crofting community. There was “not a mutter” about sustainable development in the statement of reasons.

Dealing with the grounds of appeal

(i) Acting contrary to natural justice

[107] Stated at its widest, the way in which the Commission is said to have acted contrary to natural justice is that they dealt with a matter in which one of their staff had an interest. Sir Crispin was very clear that his objection was as fundamental as that. The very fact that Fiona Gibson was employed by the Commission was enough to disqualify the Commission from dealing with these applications. Had she worked in a department which had nothing to do with croft vacancies or assignations – such as Human Resources or Finance – it would have made no difference. It was enough that she worked for the Commission at all. It was a matter of public confidence in the administration of justice of the kind spoken of in Lawal v Northern Spirit Ltd, albeit this case was not by any means on all fours with that one. How would it look to a member of the crofting community, or indeed any member of the public, if the Commission was deciding applications in which one of their own staff had an interest?

[108] Sir Crispin’s submission seemed to suggest that a slightly different test from that laid down by Lord Hope in Porter v Magill applies where what is complained of is a systemic fault. The cases referred to can certainly be divided into cases of alleged systemic fault (Lawal being the clearest but also, arguably, Davidson and the Hrvatska and Rompetrol cases)and others of a non-systemic nature (Porter, British Car Auctions Ltd, Pinochet and East Northamptonshire District Council & Ors). If we understood Sir Crispin’s submission correctly, it was that the public confidence consideration, not mentioned in Porter, was an additional consideration which applied in cases involving systemic fault.

[109] But there is no suggestion of a different test in the judgements in Lawal (including the dissenting opinion of Pill LJ in the Court of Appeal). On the contrary the reasoning is very firmly rooted in the reformulation of the earlier test made in Porter; see para 14 and the quotation from Pill LJ set out in para 9. The reasoning at para 14 of the Judicial Committee’s opinion culminates in this passage:-

“Public perception of the possibility of unconscious bias is the key. It is unnecessary to delve into the characteristics to be attributed to the fair-minded and informed observer. What can confidently be said is that one is entitled to conclude that such an observer will adopt a balanced approach. The idea was succinctly expressed in Johnson v Johnson (2000) 201 CLR 488, 509, para 53, by Kirby J when he stated that ‘a reasonable member of the public is neither complacent nor unduly sensitive or suspicious’.”

So the standpoint remains that of the fair-minded and informed observer.

[110] At paras 20 and 21 guidance is given as to the correct analysis and approach in the application of the Porter test in a case involving a systemic challenge:-

“20. The correct analysis is as follows. One starts by identifying the circumstances which are said to give rise to bias. In the present case the evidence is limited to the facts set out at the beginning of this opinion, namely that a Queen’s Counsel appearing on an appeal before the appeal tribunal had sat as a part-time judge in the appeal tribunal with one or both lay members hearing the appeal. In such cases there may be substantial variations in the extent to which the part-time judge and the wing members had sat together in the appeal tribunal and how recently. These differences are, however, not material. The House must concentrate on a systemic challenge and apply a principled approach to the facts on which it is called to rule.

21. The principle to be applied is that stated in Porter v Magill, namely whether a fair-minded and informed observer, having considered the given facts, would conclude that there was a real possibility that the tribunal was biased. Concretely, would such an observer consider that it was reasonably possible that the wing member may be subconsciously biased?”

[111] We start then with the circumstances which are said to give rise to bias. On the appellants’ argument the circumstance which is said to give rise to bias is that Mrs Gibson worked for the Commission. What would the fair-minded and informed observer – neither complacent nor unduly sensitive or suspicious – make of that?

[112] In our opinion a fair-minded and informed observer would not think that the circumstance of Mrs Gibson being employed by the Commission in and of itself gave rise to a real possibility that the tribunal was biased. Such an observer would, in our view, realise that there may be ways available to the Commission to protect against the risk of bias and would indeed expect the Commission to have systems in place to exclude such risk. He would perceive a theoretical risk of bias but would want to know what had been done to exclude the “real possibility” of bias of which Porter and Lawal speak.

[113] We have come to that conclusion by attempting to put ourselves in the position of the fair-minded and informed observer. There is clearly a large element of subjectivity involved in such an exercise, as the differing conclusions to which the distinguished judges in the Court of Appeal in Lawal (Lord Phillips of Worth Matravers MR and LLJ Mummery and Pill) came show. In attempting that exercise in this case we do not have available to us – at the high level of generality which the appellants’ argument involves – a set of circumstances, such as was present in Lawal, by which we can identify a mechanism by which bias, conscious or unconscious, can operate. In Lawal that was the knowledge one of the wing members of the tribunal had of counsel appearing before the tribunal and the fact that the person now appearing as counsel would have been looked to for advice on employment law by the wing member in the past, all set in the collegiate spirit in which the appeal tribunal was said to operate (per Pill LJ, as quoted at para 9 of the Judicial Committee’s opinion). On these facts one can see how a real possibility of unconscious bias can be said to arise. There is nothing similar in the mere fact of Mrs Gibson’s employment with the Commission. Instead there is only the same theoretical possibility as exists whenever a body of any kind makes an administrative or judicial decision involving a member of its own staff. And examples of such are not hard to find. For instance, local authorities must sometimes, through their planning committees, make decisions on planning matters involving members of their own staff, whether as applicants or objectors. Similarly, Scottish judges may hear cases, whether civil or criminal, involving members of the Scottish Court Service staff. Neither of these situations is, of course, identical to the present situation but they do involve similar issues. A fair-minded observer would never say that a local authority was incapable of proceeding without a real possibility of bias in the former, nor a judge in the latter. What he would do would be to ask about the facts of the particular case.

[114] For these reasons we repel the submission that Mrs Gibson’s employment precluded the Commission from dealing with these applications.

[115] We now come on to consider whether the particular facts and circumstances of Mrs Gibson’s involvement with this application pass or fail the Porter test. The authorities emphasise that the starting point is to establish the relevant facts and circumstances. In In re Medicaments Lord Phillips of Worth Matravers MR said “The court must first ascertain all the circumstances which have a bearing on the suggestion that the judge was biased” (para 85). In Porter itself Lord Hope, in his reconciliation of the various approaches to this problem which had emerged in England, Scotland, Australia and Strasbourg, described the approach of the Strasbourg Court as “[looking] at the question whether there was a risk of bias objectively in the light of the circumstances which the court has identified” (para 100, emphasis added). And the formulation of the test itself (at para 103) is in terms of “whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased” (emphasis added).

[116] Similarly in Helow Lord Hope, discussing the attributes of the fair-minded and informed observer, said this:-

“Then there is the attribute that the observer is ‘informed’. It makes the point that, before she takes a balanced approach to any information she is given, she will take the trouble to inform herself on all matters that are relevant. She is the sort of person who takes the trouble to read the text of an article as well as the headlines.”

[117] And, in a passage already quoted, Lord Steyn in Lawal said “One starts by identifying the circumstances which are said to give rise to bias” (para 20).

[118] The role of the facts in correcting what might be the first appearance of things is also important. Porter involved an auditor who was asked to report on certain matters involving the sale of council houses by a local authority. The circumstances attracted great publicity. The auditor, in what was subsequently described by the courts as an error of judgement, convened a press conference to announce provisional findings. At that press conference he expressed his provisional views in what was described by the Divisional Court as “florid language”. In that context Lord Hope, referring to the approach of the Divisional Court, said this:-

“Schiemann LJ said, at p 1457D-E, that there was room for a casual observer to form the view after the press conference that the auditor might be biased. Nevertheless he concluded, at p 1457H, having examined the facts more closely, that there was no real danger that this was so. I would take the same view.” [Para 105, emphasis added].”

[119] This is related to the question – the question which the court in a situation like this must ultimately ask – whether any fears of bias are objectively justified. In this context the discussion contained in Lord Hope’s speech in Davidson is interesting. At paras [50] to [53] he considers the approach to be taken where there are doubts about the “structural impartiality” of a tribunal in the light of the jurisprudence of the Strasbourg Court discussed in Pabla Ky v Finland, supra. That was a case in which a complaint was made about the lack of independence of a member of the Housing Division of the Finnish Court of Appeal who was also a member of the Finnish Parliament. The objector relied on the doctrine of separation of powers as between the legislature and the judiciary. In that case, in a passage relied upon by Sir Crispin, the European Court of Human Rights said this (on the subject of impartiality of tribunals):-

“27. As concerns ‘impartiality’, there are two aspects to this requirement. First, the tribunal must be subjectively free of personal prejudice or bias. Secondly, it must be impartial from an objective viewpoint, that is, it must offer sufficient guarantees to exclude any legitimate doubt in this respect. Under the objective test, it must be determined whether, quite apart from the judges’ personal conduct, there are ascertainable facts which may raise doubts as to their impartiality. In this respect even appearances may be of a certain importance. What is at stake is the confidence which the courts in a democratic society must inspire in the public and above all in the parties to the proceedings.”

[120] Sir Crispin laid emphasis on the reference there to “even appearances” being important. But that is not an end to the matter, because at para 30 of its judgement the Court in Pabla Ky said this:

“Lastly it should be borne in mind that in deciding whether in a given case there is a legitimate reason to fear that these requirements [a reference to requirements of the Convention] are not met, the standpoint of the a party is important but not decisive. What is decisive is whether this fear can be held to be objectively justified …”

Of that passage Lord Hope in Davidson said this (at para [53]):-

“The requirement which the Strasbourg Court stressed in para 30 of its judgment that the fear that the tribunal was not impartial must be justified objectively is an important safeguard against abuse of the objection. What is decisive is whether the fear is based on an objective appraisal (see Rojas v Berllaque, per Lord Hobhouse of Woodborough, p 211, para 32, and Lord Rodger of Earlsferry). This enables account to be taken of all the surrounding circumstances. The need for a proper understanding of the issues that are involved is another safeguard. This is because, as the court explained in paras 29 and 34 of its judgment in Pabla Ky, the objection has to be justified on the facts of the case, not by relying on a theoretical principle.”

[121] Appearances therefore matter and no doubt theoretical principles matter, but the authorities show that they are not conclusive; nor would one expect them to be.

[122] So what are the relevant facts and circumstances in this case? What would the fair-minded observer want to know before considering himself sufficiently informed to take a view? It seems to us that the relevant facts are as follows:-

(i) That Mrs Gibson was employed by the Commission.

(ii) That she worked in the “Absentee” section, a section different from the one dealing with assignation applications.

(iii) That she was on maternity leave at the material time.

(iv) That she knew Grant Jones personally.

(v) That she may have known other members of the department processing applications for consent to assignations, given that the Commission’s staff is relatively small and there is likely to be some cross-over between departments in terms of personnel having worked in both or information being exchanged between them.

(vi) The terms of said email exchange with Grant Jones.

(vii) That Mr Swann did not know Mrs Gibson, did not know that she was an employee of the Commission and that there had been no direct contact between them in relation to these applications.

(viii) The extent of Mr Jones’ involvement in advising or informing Mr Swann in relation to these applications.

[123] Having been put in possession of that information what would the fair-minded observer – neither unduly suspicious nor unduly complacent – make of it? In our view the following view would be taken:-

(i) That there was no possibility of bias on Mr Swann’s part.

(ii) That any risk of bias was confined to the earlier stage in the process, when the Casework Papers were being prepared by Mr Jones.

(iii) With regard to that earlier stage, that there was no real possibility of Mrs Gibson influencing Mr Jones or members of the relevant department in the way of daily contact with them as work colleagues, given that she was not in the office at that time.

(iv) That Mrs Gibson’s involvement was, therefore, to be seen as confined to said email exchange.

(v) That said email exchange was innocuous and showed Mrs Gibson to be acting only as a post-box for her father and, in particular, did not show her to be acting in an advocacy role.

(vi) That Mr Jones, may consciously or unconsciously, be well-disposed to Mrs Gibson as a colleague with whom he was on first name terms.

(vii) That, there being a denial that Mr Jones had had any other contact with Mr Swann, in relation to advising him on the applications, beyond the presentation of the Casework Papers to him, the Casework Papers required to be scrutinised in order to see whether there was any trace of bias or favouritism to the landlords.

(viii) That, the Casework Papers disclose no bias or favouritism towards any party and contain no advice or recommendation to Mr Swann as to the decision at which he should arrive nor as to how he was to arrive at it.

(ix) That there was, therefore, no real possibility that the tribunal was biased.

[124] In relation to the last point Sir Crispin was at pains to persuade us that the tribunal here was the Commission itself, and not merely Mr Swann. We have already dealt with the argument based on structural unfairness. The decision was a decision of the Commission, of course, but it was Mr Swann who made it. So the question at this stage – the structural argument having been disposed of – is whether there was a real possibility of bias on his part. It seems to us that this is a situation in which one can, of course, speculate about possible contact between Mrs Gibson and someone in the Commission about these applications, over and above what has been disclosed. And we accept that the fact that Mrs Gibson had anything at all to do with these applications would naturally cause fear of a risk of bias to the applicants. But when the test of objective justification is applied it seems to us to produce the foregoing result. There is no evidence to support such objective justification. We therefore reject the first ground of appeal.

[125] We should say, for completeness, that we did not find the references to Hrvatska and Rompetrol very helpful. They were decided in a forum different from our domestic courts and from the European Court of Human Rights. They are not authoritative. Given what was said about the decision in Hrvatska in Rompetrol it may be that the Hrvatska decision displays an excess of caution under pressure of time. Nothing in either case persuades us towards a different line of reasoning from the foregoing.

(ii) Adequacy of the statement of reasons

[126] There was no dispute between Sir Crispin and Mr Parratt as to what the law requires here. The dispute was as to whether the statement of reasons in this case satisfied it.

[127] The authorities contain a number of concise and helpful statements of what is required and although some of them have already been quoted it is convenient to repeat them here. In Wordie Property Co. Ltd Lord President Emslie said (at p 348) “The decision must, in short, leave the informed reader and the court in no real and substantial doubt as to what the reasons for it were and what were the material considerations which were taken into account in reaching it.” In Leisure Inns Lord Justice-Clerk Ross, agreeing with a submission of counsel, said this (at p 233) “I agree with him that behind every ground for refusal there must be adequate reasons, and that for these reasons there must be a proper basis in fact.” In South Bucks District Council, summarising the authorities, Lord Brown of Eaton-under-Heywood said "The reasons for a decision must be intelligible and they must be adequate. They must enable the reader to understand why the matter was decided as it was and what conclusions were reached on the ‘principal important controversial issues’, disclosing how any issue or law or fact was resolved.”

[128] The statement of reasons in the present case (set out at para [10] above) is intelligible. It explains the ground on which the decision was made: the interests of a sustainable crofting community. It identifies the principal issue in the case: the choice between allowing one crofter with a good track record to acquire multiple croft tenancies, on the one hand, and satisfying demand from potential new entrants, on the other. It states the conclusion arrived at on that issue: satisfying demand from potential new entrants was preferred. What is does not explain is why the matter was decided in that way.

[129] Here it is worth repeating the passage from the opinion of Lord Justice-Clerk Gill in Ritchie (at para [12]) already quoted because it seems to us to bear very directly on this question:-

“The decision-maker, having taken a particular consideration into account, may in the event decide that other considerations outweigh it. Such a consideration, being thus outweighed, is not a determining consideration; but it is material nonetheless because it has formed part of the decision-making process. In fulfilling his duty to give proper and adequate reasons, the decision-maker need not engage in an elaborate and detailed evaluation of each and every point that has arisen at the hearing. But his statement of reasons must identify what he decided to be the material considerations; must clearly and concisely set out his evaluation of them; and must set out the essence of the reasoning that has led to his decision.”

[130] In our opinion the statement of reasons in the present case does not satisfy these requirements. The opening sentence of that passage envisages a balancing exercise being carried out: it talks about one matter outweighing another. The Commission’s decision in the present case is, as Mr Parratt submitted, clearly suggestive of such a balancing exercise having been carried out. But the statement of reasons does not tell the reader why one consideration was considered to outweigh the other on the facts of the case. The reasoning upon which the decision was arrived at on the facts of this case is not explained. In terms of the last sentence of the foregoing quotation, the decision tells the reader what the decision-maker considered to be the material considerations but it does not set out his evaluation of them nor the essence of the reasoning which has led to the decision. In that regard the final sentence of the statement does not in our view suffice. It merely states the reasons for which one would favour young entrants into crofting in the abstract without any comparison between these, on the one hand, and what was to be said for maintaining the viability of Mr Fraser’s crofting enterprise, on the other.

[131] Mr Parratt argued that resort could be had to the Casework Papers to supply any deficiency in the statement of reasons: that the statement of reasons was to be read in the light of the parties’ knowledge of the processing of these applications. We acknowledge that the test here involves the “informed reader” (Wordie p 348) and that “[d]ecision letters must be read in a straightforward manner, recognising that they are addressed to parties well aware of the issues involved and the arguments advanced” (South Bucks DC v Porter, para 36). We therefore accept that statements of reasons have to be read in context. But the difficulty here is that none of the papers which were made available to parties contains material which would allow the informed reader to make out the reasons for which one consideration was thought to outweigh the other. The Casework Papers do not present arguments (beyond summarising the objections and the letters of support) or reasoning: they are factual in content and neutral as to conclusion. By looking at them the reader would certainly know where the decision-maker found the evidence for demand for croft tenancies from potential new entrants: from the representations made by Blair and Eoin MacDonald. What he would not find is a comparison of how the interests which the Commission had to have in mind, contained in sec 58A(7)of the Act, would be served by allowing the croft tenancies to become available for possible letting to the MacDonalds, on the one hand, as against the effect of refusal of consent on Mr Fraser’s crofting operation, on the other.

[132] For these reasons we sustain this ground of appeal.

(iii) Failure to have regard to factors contained in sec 58A(7)

[133] This ground is linked to the foregoing ground. Where the statement of reasons does not adequately disclose the decision-maker’s reasoning it is difficult for an appellate court to know what was taken into consideration and what was not, nor in what detail. We can only assess matters on the basis of what appears to have been taken into account.

[134] This ground of appeal is divided into four sub-grounds.

[135] The first matter which is complained of under this heading is that the effect of refusal upon Mr Fraser’s crofting enterprise and, consequently, upon the interests of the “crofting community in the locality of the land” and “the sustainable development of that crofting community” (paras (c) and (d) of sec 58A(7)) were not taken into account. Certainly nothing contained in the statement of reasons suggests that it was. All that is said is that “the proposed tenant makes good use of his existing crofts”. We take that to be a reference to the crofts of which he is the crofting tenant, rather than the sub-tenant, that is to say 6 & 8 and 30 Big Sand. What that sentence is saying is that Mr Fraser would be a suitable assignee, or at least that there is nothing about his crofting activity which makes him unsuitable. But there is no mention of the fact that the availability of other land, including 1 and 9 North Erradale, is integral to his crofting enterprise and that without the use of that land the viability of his crofting activity would be jeopardised, as confirmed by the SGRPID report, page 1, final paragraph.

[136] This omission may have been caused, or contributed to, by the Commission, in their instructions to SGRPID, confining themselves to the question whether the assignation to Mr Fraser would have adverse effects in terms of sec 58A(7) (see Casework Papers, page 3). We agree with Sir Crispin that the beneficial effects as well as adverse effects required to be considered.

[137] We agree that the foregoing matters, which we consider to be material, appear not to have been taken into account and we therefore sustain this element of this ground of appeal.

[138] The second matter complained of is that the Commission failed to have regard their own policy on “Promoting Occupancy”. The relevant parts of the policy have already been quoted. In our view these paragraphs encapsulate very clearly the two sides of the balancing exercise which the Commission required to carry out in this case. In our view, given that these represent part of declared Commission policy, published, we were told, on their website, we think that they give rise to a presumption that the decision-making process will include consideration of these matters. The matter was argued as one of legitimate expectation but we find it unnecessary to go into that area of law. We think it plain that the Commission’s declared policy should have been followed. Whilst it is clear that the second of the two paragraphs quoted has informed the decision arrived at it is not by any means clear that the first has. Accordingly we sustain this element of this ground of appeal also.

[139] The third sub-ground under this head is that the Commission failed to consider that the proposed assignee has had the use of the crofts for 20 years as a main part of his agricultural business. As originally stated it added nothing to the argument advanced under the first sub-ground above. However, following the amendment permitted in our order of 4 September 2013, it became the basis of an argument based on Article 1 of Protocol 1 of the ECHR.

[140] Under reference to what was said in the note which accompanied our order of 4 September, Mr Parratt submitted that the new averments were irrelevant because Mr Fraser was not a party to the appeal. He did not develop his argument fully. He simply left it to us to decide whether that submission was correct. He did however go on to concede that, in terms of the Tre Traktorer case, if Mr Fraser’s possessory right was a material consideration the Commission would have to carry out a balancing exercise as between the benefits of new entrants and the advantages of allowing Mr Fraser to remain in possession. His contention was that the Commission had carried out that exercise.

[141] In our said note we were using the word “irrelevant” in its non-technical sense. We meant by it that it was possible to regard Mr Fraser’s rights as having nothing to do with the appellants. We anticipated an argument as to whether the appellants were entitled to pray in aid the alleged failure of the Commission to deal properly with a third party’s Article 1 rights. In the event no such argument has been advanced. If the matter is, rather, one of relevancy in the technical sense, the averments would only be irrelevant if they were not capable of supporting the appeal. In our opinion these averments are capable of supporting the appeal. It is a matter of concession that Mr Fraser’s Article 1 rights were engaged. That being so the Commission required to carry out the foresaid balancing exercise to check whether dispossessing Mr Fraser of the sub-tenancies of these crofts was in the public interest, proportional and in accordance with the conditions provided for by law; Pairc Crofters Ltd v The Scottish Ministers, supra.Failure to do so has the potential to adversely affect the appellants’ interests. Accordingly we hold that the appellants’ submissions regarding Article 1 of Protocol 1 are not irrelevant in the technical sense.

[142] Mr Parratt’s point was that the balancing exercise had in fact been carried out. Although the particular requirement to carry out an ECHR compliance assessment was not spelt out in the Casework Papers the question of the loss of Mr Fraser’s business was. That was highlighted in the material before the Commission. It was therefore plain that this matter had been considered and that a balancing exercise must have been carried out. The statement of reasons did not go into the detail of that exercise but it told us the result. That was sufficient.

[143] For the reasons given in dealing with the first sub-ground above it is not apparent to us that the Commission took account of the effect of their intended decision on Mr Fraser’s business. It therefore follows that they were in breach of Article 1. This sub-ground of appeal is therefore sustained.

[144] Before departing from it we would, however, say this. We do not think that our decision imposes upon the Commission an onerous additional duty. That is simply because where the decision making process has been properly carried out in terms of the 1993 Act, and in particular with regard to the factors listed at sec 58A(7), the assessment of the public interest involved is unlikely to be capable of being characterised as manifestly unreasonable; James v United Kingdom, supra.

[145] The fourth thing the Commission are said to have failed to take into account is the fact that, according to the SGRPID report, there are other crofts in North Erradale which are either owned or tenanted by absentees (one of each) and there are only four active crofters in the township, suggesting that a number of other crofts are not being worked. The appellants make the point that enforcement proceedings could be taken to free some of these croft tenancies to meet the demand. The SGRPID report states that, given the fact of other vacant crofts in the township, approving the present applications ought not to affect the interests of, or the sustainability of, the local crofting community.

[146] This is, in our opinion, a matter which the Commission ought to have taken into account. Where there is, on the one hand, demand for croft tenancies and, on the other, a potential assignee with a proven track record in crofting, the Commission ought to have considered whether the interests of both could be satisfied by freeing up other tenancies. The decision letter contains no indication of that having been done. Accordingly we sustain this sub-ground of appeal also.

(iv) The making of a material findings- in-fact without sufficient evidence on which to base them

[147] Two findings of fact are complained of. They are related. The first is that there was demand for croft tenancies. The second is that such demand “was in the interests of population retention and creating opportunity for new entrants to crofting”.

[148] The evidence on which the Commission founded for the first of these was obviously the representations made by Eoin and Blair MacDonald. In our view the Commission were entitled to have regard to these as evidencing a demand for crofts, notwithstanding that Mrs MacKenzie, as Grazings Clerk, and Mr Fraser, as a Commission Area Assessor, were unaware of demand and that the Estate had no record of demand (because it kept no record of enquiries). The appellants make something of the tentative nature in which Eoin MacDonald’s interest in acquiring a croft was expressed. It seems to us that their true complaint is that the Commission did not make further enquiry as to how genuine and credible he and his brother were as potential new entrants to crofting and how well qualified they were for that role. However what to make of the evidence and what weight to give it was pre-eminently a matter for the Commission. It may be that further enquiry would have been appropriate as part of the foresaid balancing exercise. But we are satisfied that the MacDonalds’ representations provided a sufficient evidential foundation for the finding complained of.

[149] So far as the second finding is concerned it is, obviously, dependent on sufficient evidence of demand being available. We have dealt with that above. Once it is accepted that there was a sufficient evidential base for finding that there was a demand for crofts – and given the nature of that demand, coming as it did from two young men, one of whom presently lives outwith the area – it is a matter of inference that making tenancies available was in the interests of population retention and creating new entrants. That seems to us to be a reasonable inference to make. Accordingly we hold that there was sufficient evidence to support this finding-in-fact.

[150] There remained to be carried out, of course, the exercise of balancing the prospect of such population retention and new entrant opportunity against the restriction of Mr Fraser’s crofting activity which refusing consent would entail. The appellants argue that the Commission reached a wrong conclusion on the basis of the evidence and that this was an error of law (Grounds of Appeal, para 4, second sentence.). That seems to us, however, to be simply another way of stating that the Commission exercised its discretion in an unreasonable manner, which is the next, and final, ground of appeal. The present ground of appeal is refused.

(v) That the Commission exercised its discretion in an unreasonable manner

[151] Under reference to Associated Provincial Picture Houses Ltd v Wednesbury Corporation it is said that no reasonable tribunal could have arrived at the decision complained of. That argument takes in the various matters complained of in the earlier grounds of appeal plus the contention that on the facts of this case no reasonable tribunal could have held that the prospect of population retention and attracting new entrants to crofting outweighed the detrimental effects of refusal of consent on Mr Fraser’s crofting activity and, consequently, on the interests of the crofting community in the locality and its sustainable development (paras (c) and (d) of sec 58A(7)). We are not persuaded that that is so. Population retention and making croft tenancies available for new entrants were plainly considerations which it was proper for the Commission to have in mind. Mr Parratt drew attention to the significance of the former in the scheme of the Act. The Commission had evidence of one person already living in the area who wanted a croft and of another outwith the area who wanted to return. What weight to give to that evidence was, as we have already said, primarily a matter for the Commission. It certainly had to be weighed in the balance against the effects of refusal of consent on Mr Fraser’s activity. Given how real the threat to Mr Fraser’s crofting activity was in the event that consent was refused (vouched by the SGRPID report) one might have expected the Commission to test the firmness of intent of the Macdonald brothers before coming to a conclusion as to whether their aspirations were likely to deliver the beneficial results which were hoped for. The decision arrived at suggests that they did so but there is no actual evidence of it and it is not explained how the Commissioner came to persuaded that such results were likely to be achieved. But that goes back to the failure to give adequate reasons for the decision. Adequate reasons for the preference may exist but they require to be identified and explained. That is why we have upheld certain of the foregoing grounds of appeal. But we are unable to conclude that no reasonable tribunal would have arrived at the decision arrived at here and accordingly this ground of appeal is refused.

Disposal

[152] Parties were agreed that should we sustain the appeal, except on the question of bias or because the whole process was vitiated as not being ECHR compliant, we should remit these cases to the Commission to be reconsidered by a different Commissioner. They were agreed that parties, including objectors, should be given the opportunity to make further submissions, particularly to take account of anything new which has emerged since the cases were originally decided.

[153] We have followed that course. For the guidance of the Commission we would say this:-

(a) The cases are being remitted so that they can be considered afresh.

(b) We considered whether we should simply remit to Mr Swann to allow him to set out his reasoning more fully but parties were agreed that more than that is required. Accordingly, we are remitting to the Commission so that matters can be considered afresh by one or more of the other Commissioners.

(c) The clock should be put back to the point in time when the period for objections had elapsed. New objectors (and supporters) should not be allowed in.

(d) The parties, by which we mean the applicants, Mr Fraser, the landlord and all who made representations to the Commission before said period had elapsed should be given the opportunity to make further representations, to include any changes of circumstance since their original representations were made. We have considered whether the fact that they are not within the definition of crofting community contained in sec 61 of the Act should preclude the MacDonald brothers from making further submissions. However that would be at odds with the approach taken so far and would unhelpfully restrict the Commission’s fresh consideration of matters. In any event, although they are not members of the crofting community, they are probably people with a relevant interest in the application in terms of sec 58A(4)(d).

(e) The Commission may carry out any further inquiry – whether by calling for another report from SGRPID or holding a hearing on the applications, or otherwise – they consider appropriate.

(f) While regard should, of course, be had to what is said in this judgement and, particularly, to the grounds upon which the appeals have been upheld nothing in this judgement should be taken as the Court expressing a view on the decision arrived at by Mr Swann on these applications. We have no such view. The Commission is free to arrive at the same decision or a different one.

Expenses

[154] We have ordained parties to submit any motions and submissions on expenses within 21 days of intimation hereof. Although we have hitherto dealt with such appeals on the basis of expenses following success, we would be interested in receiving submissions as to whether it is appropriate to find a body such as the Commission liable in expenses, given its statutory, regulatory role.