Decision of the Scottish Land Court

Kevin Martin (Applicant)
v
Mercedes McMillan (Respondent)

Case reference SLC/17/18
before
Lord Minginish, Chairman, and Tom Campbell
17 December 2018

Introduction

[1] In this application declarators are sought, first, “that the Applicant is the tenant of the Subjects known as and forming those 17.5 acres or thereby at Willow Rise, Whittinghame Estate, Haddington, registered under Title number ELN15099” (hereinafter referred to as “the subjects”) and, second, “that the Applicant occupies said Subjects in terms of a limited duration tenancy … as governed by the Agricultural Holdings (Scotland) Act 2003”. There is a third crave for determination of the terms of the tenancy and the usual crave for expenses.

[2] The applicant is Mr Kevin Martin. The respondent was originally Mrs Mary McMillan but, owing to a change of ownership of the subjects, she was replaced by her daughter, Miss Mercedes McMillan. However, the real respondent, in many senses, is Mr David McMillan, husband of Mary McMillan and father of Mercedes. He controls the McMillan family’s business and assets.

[3] We heard proof over three separate days, 7 and 30 August and 6 November. Mr Martin represented himself, although his pleadings had obviously been drafted by someone with some knowledge of how that should be done, and the respondent was represented by Mr Graham Basten of Messrs Basten Sneddon, solicitors, Dunfermline.

Witnesses

[4] Mr Martin gave evidence and, at the close of the respondent’s proof, moved for an adjournment to secure the attendance of a Ms Gayle Wylie. We refused that motion on the grounds (a) that Mr Martin had been aware of the importance of this witness’s evidence from the outset yet had done nothing to secure her attendance, (b) that to grant the motion would be prejudicial to the respondent, in terms of delay and expense, (c) that, although unrepresented in court, Mr Martin clearly had access to legal advice which could have advised him as to how to get the witness to attend, and (d), on the basis of information provided by Mr Basten, it seemed, in any event, that this witness was likely to turn out to be emphatically hostile to Mr Martin’s position. For the respondent, her father, David McMillan, her mother, Mary, and her sister, Velvet, gave evidence as did Mr David Johnson, solicitor, of Johnson Legal, 22a Rutland Square, Edinburgh.

Credibility and reliability

[5] We did not find Mr Martin to be either credible or reliable. That was primarily because he had given contradictory evidence in other cases and other courts (see below), although there are also other factors which we mention when we come to resolving conflicts in the evidence below. When these contradictions were put to him, he said, among other things, as we have noted him, ”Everything I said [in these other cases] may or may not be accurate as to what really happened”, “I thought them to be correct at the time”, and “It’s not intentional. When I say things I believe them to be true” and “I’m confused, not a liar”.

[6] He also complained of being under pressure when, in fact, there was nothing about the conduct of the hearing generally, or cross-examination in particular, which was unfair or overbearing or oppressive. Yet he said things like “My brain is closing down. I’m absolutely shattered”, “I’m absolutely goosed. I can’t really think straight at all.”, and “He [Mr Basten] is taking advantage of the way I process information.”

[7] As a possible explanation for his difficulty with these things, he said there had been a suggestion some time ago from someone carrying out some sort of test over the telephone that he may be suffering from Asperger’s Syndrome but it had never been formally diagnosed. There was, in any event, he said, something about the way he processed information which was different from other people. He was no good with paperwork – it was “a nightmare” – but he was very creative. As has just been said, he complained that Mr Basten was taking advantage of his difficulties.

[8] If it is the case that Mr Martin suffers from Asperger’s or has difficulties of the kind he mentioned, he deserves understanding rather than criticism but that does not affect the credibility and reliability of his evidence. The fact is that, in the two Sheriff Court processes described below, he told Sheriffs Braid and Stirling one thing (or, indeed, several things) and told us something entirely different. His explanation as to why we should believe what he was saying now, rather than what he had said then, was that, due to assistance he was getting from friends, he saw things much more clearly now. Maybe he does but he did not succeed in communicating that clarity to us. We were left unable to accept his evidence on any important matter unless corroborated by other evidence which we were inclined to accept.

[9] We also had difficulty with Mr McMillan in relation to some aspects of his evidence. In particular we felt that there was some force in Mr Martin’s submission that he and Mr McMillan had at one time been friends, or at least had known each other quite well and been on amicable terms, else we doubt whether Mr McMillan would have agreed the lease of Apartment 3 to Ms Islam and her young family (see below) for such a low (relatively speaking) rent. But, by and large, he gave his evidence in a straightforward manner without dissembling or evasion. Moreover, the evidence he gave to us was entirely consistent with the evidence he had given to Sheriff Stirling. As will be seen below, that does not mean that we accepted his evidence on everything but, in general, we found him to be more credible and reliable than Mr Martin.

A timeline of events

[10] Before we narrate the evidence it will assist the reader if we set out the sequence of events with which the case is concerned. That can be done as follows:

i. The applicant was formerly in a relationship with a lady called Raki Islam. Although, because of religious and cultural differences, they were never legally married, he refers to her as his wife or, now, ex-wife. They have five children.

ii. Raki Islam has a brother, Shafiqul Islam, who works in IT in London and Dubai. In or around early 2011 he and the applicant came to an agreement, whereby they would set up or acquire a company to farm the subjects under a lease, formally from Mrs Mary McMillan, the owner, but really from Mr McMillan. The applicant’s idea was to use the subjects for a social programme whereby disadvantaged young people could gain experience of working on the land. His agreement with Shafiqul Islam was that he (the applicant) would provide the labour and Mr Islam the funds, including the rent.

iii. In pursuance of this Mr Islam bought an “off-the-peg” company called “The Magic Farm Ltd” (“Magic Farm”), incorporated on 8 April 2011, of which he became sole director and the applicant’s six-year-old daughter, Mia, the only shareholder. By lease dated 9 and 18 June 2011 Magic Farm entered into a Short Limited Duration Tenancy (an “SLDT”) of the subjects with Mrs Mary McMillan with a stipulated duration of 1 June 2011 to 31 May 2015 and a yearly rent of £12,000.

iv. Magic Farm took possession of the subjects under this lease in the form of occupation by the applicant who put a number of animals, including a herd of pigs, onto the land. However, Magic Farm was short-lived; not having filed annual returns or accounts, it was dissolved by compulsory strike-off on 7 December 2012.

v. At or around that time, Raki Islam, who had been living with the applicant at an address in Stenton, East Lothian, entered into a lease of Apartment 3. Whittinghame House, Whittinghame, also East Lothian, owned by Velvet McMillan, another of Mr & Mrs McMillan’s daughters. According to an unsigned copy of the lease which is production 32, it was initially for a period of six months, from 21 December 2012 to 21 June 2013, and the rent was £850 per month.

vi. Notwithstanding the dissolution of Magic Farm, the applicant continued to occupy the land as before. His presence there was not, however, welcomed by the neighbours, who, according to the applicant, made life difficult for him by objecting to everything he tried to do and complaining about how he did it.

vii. The applicant avers that his occupation of the land was regularised by an oral agreement made with Mr McMillan at a meeting in the Golden Grain Café, Haddington in January 2013 in terms of which he would be tenant in his own right and the rent would be £650 per month. Mr McMillan denies both the meeting and the averred agreement.

viii. On 16 December 2013 another company was formed on the initiative of the applicant. In order to spite his neighbours he called it “My Neighbours Possess An Enormous Superiority Complex Yet Ironically They Are Both Emotionally And Intellectually Very Limited” (“My Neighbours”). As with Magic Farm, its only director was Shafiqul Islam and its only shareholder Mia Martin.

ix. Production 2 bears to be a copy of a lease of the subjects by My Neighbours from Mrs McMillan on an SLDT entered into on 31 January 2014 but purportedly backdated, notwithstanding the date of the company’s incorporation, to 1 June 2011, the same date of entry as the lease to Magic Farm and for the same period and at the same rent. The authenticity of this lease is another hotly contested issue in the case.

x. On 25 February 2014, having been abandoned by the applicant, the herd of pigs and a flock of hens were taken into the possession of the local authority who instituted Sheriff Court proceedings against the applicant under the Animal Health and Welfare (Scotland) Act 2006. On 15 May 2014 the fifth diet of proof which had been set in the case went ahead at Haddington Sheriff Court in the absence of the defender, the presiding sheriff, Sheriff Braid, not being persuaded that the proof should, yet again, be discharged on the basis of the whole information available as to the applicant’s state of health. Instead he heard the evidence led by the local authority and, having done so, granted them a disposal order authorising the sale of the pigs and hens.

xi. The applicant appealed against that decision, first of all, unsuccessfully, to the Sheriff Principal and then, equally unsuccessfully, to the Court of Session, where Lady Paton delivered the Opinion of the Court on 17 February 2015. A significant feature of this litigation, for present purposes, is that at the start the applicant claimed the animals belonged to Mr Islam or his company (“My Neighbours”) but, later, that ownership had been transferred to him (see paras [1], [2], [7] of the Court’s Opinion).

xii. While all of this was going on the applicant’s wife and children lived at Apartment 3 in Whittinghame House, where he would stay with them from time to time but, because the relationship between them was deteriorating at that time, he also stayed in a caravan on the subjects or in one or other of two flats he owned in Edinburgh, when they were unoccupied.

xiii. In August 2016 Raki Islam and her children removed from Apartment 3 in Whittinghame House into static caravans situated on an area of Willow Rise which we understand to be contiguous with, or may even be part of, the subjects. We shall refer to it as “the residential area of Willow Rise”. This was in terms of a Short Assured Tenancy granted in her favour by Mercedes McMillan, to run from the 13th of that month at a rent of £650 per month, but she fell into arrears and the following year recovery of possession proceedings were commenced at Edinburgh Sheriff Court (Haddington having closed in the meantime).

xiv. That case came to proof before Sheriff Stirling on 4 September 2017, when the defender was absent but represented by a solicitor and the applicant gave evidence on her behalf. The sole issue in the case was whether the payment of a sum of £8,947 was a payment of rent under the then current lease or of arrears under a previous lease, presumably the lease of Apartment 3. The applicant claimed it was both but the sheriff did not find him to be credible or reliable and found against him (see paras [6] and [7] of the Stated Case, a copy of which is production 18).

xv. The Stated Case which followed was never heard by the Sheriff Appeal Court because the appellant was unable to find caution but she began interdict proceedings in the Court of Session, seeking to prevent removal on the ground that the subjects from which she was being evicted were part of an agricultural tenancy. That case came before Lady Wolffe and was either decided by her or resolved between parties (which is not clear) by, in effect, restricting the area from which Ms Islam and her family were required to remove to some 2.5 to 3.0 acres around said caravans, from which the applicant then removed onto one of the fields with which this application is concerned, where they remain, with the applicant, Ms Islam and their children still in situ.

Evidence

Kevin John Martin (46)

[11] The applicant’s starting point was that he had known David McMillan for a long time and that they had been friends. That was why his wife had been given a lease of the apartment in Whittinghame House: nobody but a friend would take a woman and young children into a tenancy of a high-value property full of valuable antiques and furniture. He described how that lease had been followed by the lease of the residential area of Willow Rise and what became of that, all as has just been described above.

[12] Turning to the subjects with which this application is concerned, the first lease had been between a company his brother-in-law, Mr Shafiqul Islam, had set up, Magic Farm, and Mrs Mary McMillan. This had been in June 2011 and had been intended to endure, as an SLDT, until 31 May 2015. The idea behind the formation of the company and the acquisition of the tenancy had been to allow the applicant to develop an idea he had for a social project whereby disadvantaged children could get some experience of interacting with animals and of agriculture and rural life generally. Mr Islam would provide the finance for the project, including paying the rent of £12,000 per annum, while the applicant would “do the graft”. The applicant was neither a shareholder nor director, only an employee, although they had not got to the stage of earning any money out of which he could be paid a salary by the time the company was dissolved on 7 December 2012.

[13] Following dissolution of the company, he and Mr McMillan had, in January 2013, agreed an SLDT of the subjects with the applicant himself as the tenant. This had been agreed orally and sealed with a handshake at a meeting in the Golden Grain Café, Haddington, that month. He had explained to Mr McMillan that he could not pay a rent of £1,000 a month and Mr McMillan had agreed to reduce it to £650. He explained that although various assets in the ownership of the McMillan family may nominally be in the names of other members of the family, only David McMillan - a “massive manipulator” - called the shots. So the applicant had never had dealings with Mary or Mercedes McMillan in connection with any agreements in respect of the subjects, only David.

[14] After January 2013 he had continued to occupy the subjects in his own right. He had kept a variety of animals on the subjects, including a herd of pigs and a flock of hens. The soil was too poor for arable use so few crops had been grown although he had experimented with fruit and veg.

[15] He identified production 16 as a Schedule of rent payments made by Magic Farm and himself. He maintained that they showed he had overpaid the rent due to date. Rent payments had been irregular, to be sure, but he had always caught up. Nothing had been paid since July 2015 but that was because the overpayment up until then entitled him to a rent holiday until June 2018. Although the rent payments after dissolution of Magic Farm might appear in Mrs McMillan’s bank statements with the reference “Magic Farm”, that was simply because that was how the payments had been set up online to begin with: he had never changed that arrangement to show that they were payments from him personally, as tenant in his own right, which, in fact, they certainly were.

[16] His agreement with Mr McMillan included an option to buy the subjects at a price of £800,000 exercisable by 1 February 2019 but things between them had soured when he had heard, through a third party, that Mr McMillan had been completely dismissive of that idea, asking why he should sell to the applicant for £800,000 when he could get £4.5m for the land on the open market.

[17] He had been in occupation of the subjects, and had stock on them, since 2012 but his project was not welcomed by his neighbours, who had done everything possible to make life difficult for him and his family. So to spite them he had, again with Shafiqul Islam as sole director and his said daughter as the sole shareholder, set up My Neighbours.

[18] Setting up this company had always been just a joke at his neighbour’s expense: it was never intended to trade and had never in fact traded. A purported lease in terms of which it took the subjects on the same terms and conditions and for the same duration as the lease to Magic Farm (production 2) was bogus. Although it bore to be signed by him as a witness to Mary McMillan’s signature and although the signature looked like his, he had never signed it. He likewise thought that production 4, a copy of a letter purporting to be from Johnson Legal, solicitors, Edinburgh, dated 19 February 2014 and purporting to enclose a copy of a lease, to Mr McMillan was not genuine. He denied asking for this lease to be executed to take the place of the lease in favour of Magic Farm because Magic Farm had ended up being dissolved through inadvertence.

[19] He was cross-examined about the two sheriff court cases referred to in the timeline above and, in particular, about apparent contradictions between what he had said then and the evidence he was giving now. Suffice to say, for present purposes, that he was reluctant or unable to give straight answers to questions about these matters which, he protested, were irrelevant to the present case. We had to explain to him that what he had told other courts about these matters was relevant to the credibility and reliability of what he was telling us. He accepted that he appeared to have told Sheriff Stirling one thing and us another.

[20] At the conclusion of his evidence, when he was asked by the Court whether there was anything he wished to clarify, he explained that there was something about him which caused him to process information differently from other people. He had once taken part in some sort of assessment over the telephone which had produced the suggestion that he may be suffering from Asperger’s Syndrome, but it had never been formally diagnosed. We should believe what he was saying now, rather than what he had told Sheriff Stirling, because, with the assistance of friends, he was now much clearer about things, particularly about the various payments shown on production 16 and what they were for.

David Ingram Johnson (59)

[21] Mr Johnson is a solicitor in private practice. At the outset of the hearing we repelled an objection from the applicant to him being led as a witness by Mr Basten. The objection was on the basis of client confidentiality although the applicant was not himself Mr Johnson’s client. We repelled it on Mr Basten’s undertaking that questioning was to be confined to a single factual issue: whether Mr Johnson had sent out the letter of which production 4 bears to be a copy and, if so, whether the lease referred to in that letter was the lease of which production 2 bears to be a copy.

[22] Mr Johnson confirmed that production 4 appeared to be a letter from his firm to Mr McMillan and that it referred to enclosing a lease. He could not remember, however, at this distance in time, whether the lease being referred to was production 2 but he was unaware of any other lease which he might have been sending to Mr McMillan at that time. He could not remember passing a copy of that lease to anyone else. He was cautious about saying for whom he was acting in all of this, for fear of breaching client confidentiality, but said it wasn’t for David or Mary McMillan. He had been introduced to Mr McMillan by the applicant but Mr McMillan was not his client. (From other information in the case, we understand Mr Johnson to have been acting for Mr Islam, Magic Farm and My Neighbours.)

David McMillan (72)

[23] Mr McMillan confirmed his family’s ownership of Apartment 3 at Whittinghame House and Willow Rise, including the subjects. On professional advice various assets were held in the names of different members of his family but he himself decided on any deals involving any of their properties.

[24] He confirmed the lease to Magic Farm. He had subsequently received a telephone call from Mr Johnson, acting (as he understood) on behalf of Mr Islam and the applicant, asking if he would have any objection to changing the name on that lease. He had then received a phone call from the applicant, saying that he had the new lease (or lease in the new name, at least) for signature and they had arranged for Mrs McMillan, who owned the subjects at the time, to go to Haddington the following day to sign it. His wife had done that and five or six days later he had received a copy of the lease from Mr Johnson. He had not instructed solicitors of his own because he had been told by Mr Johnson that it was simply a change of company name, all other terms and conditions remaining the same. He identified production 4 as the letter from Mr Johnson and production 2 as the enclosed lease.

[25] Mr McMillan flatly denied the meeting in the Golden Grain Café, Haddington, in January 2013. There had been no meeting and no agreement that the applicant was to become tenant of the subjects in his own right and at a reduced rent of £650 per month: that was all “a pack of lies”.

[26] He had given Raki Islam a Short Assured Tenancy of separate subjects, the residential area of Willow Rise, on which she and her family had lived in static caravans after her lease of Apartment 3 terminated. He had subsequently raised eviction proceedings at Edinburgh Sheriff Court in the name of his daughter Mercedes (by then the owner of Willow Rise) to have her removed.

[27] Under reference to production 16, the schedule of payments made by the applicant, Ms Islam and East Lothian Council (as Housing Benefit for Raki Islam), to Mrs McMillan, he denied that any of those were for a lease of the subjects to the applicant. The payment of £8,947 referred to in Sheriff Stirling’s Stated Case was made up of arrears of rent, some for Magic Farm and some for Apartment 3. Overall, £21,000 had been outstanding in respect of the three properties (Apartment 3, the residential area of Willow Rise and the subjects of this application). The applicant had agreed to pay £11,000 of that on or before 1 November 2016 and the balance by 1 February 2017. Production 11 was a file copy of a letter from his (Mr McMillan’s) solicitors, Messrs McEwan Fraser, to the applicant and Ms Islam dated 30 August 2016 recording that agreement. The £11,000 had been paid but not the rest. The applicant had phoned Mr McMillan’s solicitors to say that he could not make that payment and that had resulted in the present proceedings. The last payment of rent for the agricultural lease of the subjects to Magic Farm/My Neighbours had been made in 2015.

[28] In cross-examination the witness maintained that the rent for Apartment 3 had been £1,500 per month, of which £850 was Ms Islam’s share and the balance the applicant’s.

[29] The applicant had never been his friend but he (Mr McMillan) had acted decently towards the applicant and his family by giving them a place to live when they had nowhere else to go. The reduced rent (Apartment 3 had originally been advertised at £3,500 per month) was explained by the fact that the applicant had promised to buy Willow Rise for £800,000.

[30] The witness had never “done business” with the applicant; all their dealings had had to do with arrears of rent. The applicant had never been a tenant of any part of Willow Rise. Three meetings had taken place in the Caledonian Hotel, Edinburgh, with the applicant and Mr Johnson, as the companies’ lawyer. The first had been to discuss arrears of rent but at the second the applicant had asked for a 25 year lease of the subjects, which Mr McMillan had rejected out-of-hand. The third had been because Mr McMillan had been unhappy with My Neighbours having Apartment 3 as its registered office. He could not be sure of dates but the last meeting had been in 2017.

[31] Mr McMillan had been unaware of the dissolution of Magic Farm, he had assumed the company had continued in business, just under a different name, until the expiry of the lease in 2015. All payments of rent in respect of the lease had borne the reference “Magic Farm Ltd” on his wife’s bank statements. He accepted that these payments had been made from the applicant’s personal bank account. He accepted that, with the exception of two payments in November and December 2012, there were no payments of £1,000 but numerous payments of £650.

[32] He denied that the My Neighbours lease had been fabricated and backdated in order to plug the gap between the dissolution of Magic Farm and incorporation of My Neighbours: that was “complete and utter nonsense”. He similarly denied that it had been produced in order to make the applicant’s own claim to be tenant of the subjects “disappear”.

Mrs Mary Kennedy McMillan (57)

[33] Mrs McMillan identified productions 1 and 2 as copies of the leases with Magic Farm and My Neighbours. They both bore her signature. With regard to the latter, her husband had told her that Mr Johnson had phoned to request a change of name on the lease. She had gone to Haddington, accompanied by her daughter, Velvet, to meet the applicant and sign the new lease. They had stopped outside the Police Station. The applicant had had the lease with him and she had signed it. It was not a fraud. She had received payments of rent for the subjects, irregularly, and they had all borne the reference “Magic Farm Ltd”.

Miss Velvet McMillan (29)

[34] Miss McMillan is a qualified solicitor, although not currently practising. At Mr Basten’s invitation she confirmed that, as such, she was aware of her duty to the court to tell the truth. She confirmed having accompanied her mother to Haddington to sign a lease of the subjects changing the name from Magic Farm to My Neighbours. This had been a few years ago but she couldn’t remember exactly when. They had stopped somewhere in the High Street and her mother had crossed the road and signed the document, while she stayed in the car.

Submissions

For the applicant

[35] The applicant began by reminding us of our duty to assess the credibility and reliability of each witness. We must “like what was said and how it was said”. We could not like what had been said by Mr McMillan. It was rehearsed and untrue. We should award him (the applicant) more badges of credibility and reliability than the other side. We should have no difficulty in awarding him enough badges to triumph.

[36] He then addressed us under three headings: tenure, rentals and farming.

[37] As to tenure, the starting point was the dissolution of Magic Farm on 7 December 2012. The company ceased to have legal personality at that date. Consequently, it had ceased to be the tenant of the subjects at that date. That was the point at which he personally had assumed the role of tenant in terms of the agreement made with Mr McMillan in the Golden Grain Café, Haddington, in January 2013. There was no question of My Neighbours being the tenant at that point because that company had not been incorporated until 16 December 2013. Only he personally could have been tenant between the dissolution of Magic Farm and the incorporation of My Neighbours but his position was that the lease in favour of My Neighbours was bogus, so he continued to be tenant in his own right notwithstanding the incorporation of My Neighbours.

[38] As to rentals, the bank statements produced (production 8) confirmed that the rent payments had reduced to £650 shortly after January 2013. This confirmed the agreement he had made with Mr McMillan in Haddington that month. Mr McMillan had, however, invented a lease interposing another tenant, a bogus third party (My Neighbours). Mr McMillan could readily have got the details of My Neighbours from Companies House. It was impossible to hold that this lease was genuine; neither Mr McMillan nor his witnesses were in any way credible or reliable on this aspect of matters and his own evidence had to be preferred.

[39] As to farming, it was risible to suggest that he had not been farming the land. There had been plenty in the press about that (a reference to the escape of the pigs from the subjects in February 2014).

[40] The applicant then resumed his attack on Mr McMillan’s credibility. Mr McMillan had come to court to tell lies. He had to retain control of his land at all costs. He had lied about the purported lease to My Neighbours and about the rent. If the applicant was successful in this application Mr McMillan would be stuck with him as tenant. That was sufficient reason for Mr McMillan to lie his way through the proceedings. In particular he had lied about:

[41] As to the kind of lease he was claiming, he was not very sure but he had been told by a lawyer that if he was in occupation for five years he would be entitled to five more. He had now been in occupation for over five years, in his own right, and was therefore entitled to such an extension.

[42] We should repel Mr Basten’s (yet to be made) submissions as wholly unreliable and incredible and grant the crave of the application.

For the respondent

[43] Mr Basten tendered copies of his submissions and then took us through them.

[44] The applicant’s case was based on an oral agreement said to have been made at a meeting at the Golden Grain Café in January 2013. Yet no evidence of the terms and conditions of the lease supposedly agreed had been led except for the reduced rent of £650 per month. It was surprising that there was no “documentary follow up” to this agreement, given that the applicant was involved in a number of businesses.

[45] The evidence as to the farming conducted by the applicant was similarly vague, with no documentary evidence as to purchase of livestock or other items needed for his farming activities, nor any evidence of the sale of any produce.

[46] The payments listed in production 16 were not consistent with a lease with a rent of £650 per month. It showed payments totalling £10,700 in 2014 although the total rent due would have been only £7,800. In 2015 there were significant payments which did not seem to correlate with such a rent. It was very significant that there were no payments later than July 2015, just after the Magic Farm/My Neighbours lease(s) had expired. The payment of £8,947 in 2016 had come from the Earthy School project and had been the proceeds of a grant. To use that money to pay rent under the lease supposedly agreed with Mr McMillan would be fraudulent. In any event in the Sheriff Court proceedings for Ms Islam’s eviction the applicant had claimed that this sum was an advance payment of rent on her lease. The payments of Housing Benefit could not, or ought not, at least, be used to pay rent under an agricultural lease.

[47] The fact that the applicant had told two different stories as to the nature of some of these payments to two different tribunals showed him to be neither credible nor reliable. That conclusion was reinforced by vagueness as to where he was living at certain times, contradictions as to whether his wife had been cut off by her family when their relationship had begun, the extraordinary evidence of his six-year-old daughter being a shareholder in the companies and his difficulty in giving straight answers to simple questions about such things as the preparation of his Inventory of Productions. Such was his lack of credibility and reliability that his case must fail for that reason alone.

[48] Turning to the respondent’s case, it was accepted that there had been a lease of the subjects to Magic Farm. The applicant, knowing that Magic Farm had been dissolved, had wanted the lease changed over to a new company, My Neighbours. Mr McMillan had agreed to that.

[49] The lease in favour of the new company had, we could infer, been prepared by Mr Johnson, who was well known to the applicant. Mr McMillan’s account of how it came to be signed by his wife was supported by his wife and their daughter, Velvet. Further evidence of its authenticity came from the fact that the applicant accepted that the signature witnessing Mrs McMillan’s signature looked like his and that Raki and Shafiqul Islam’s signatures looked like theirs; indeed the applicant had identified Shafiqul’s signature without being asked whose it was. There was, therefore, no basis for suggesting this lease was a fraud.

[50] Moreover the suggestion that it was not My Neighbours which held the lease was destroyed by the Court of Session’s judgment in the case involving the escape of the pigs, where the applicant was recorded as having said that he had resigned “from the company that has the field and the pigs”. That had also been his position before the sheriff in that case, when he had claimed, on 19 March 2014, that the pigs were owned by a limited company.

[51] It was also significant that no application to this court had been made until after the sheriff had granted eviction from the residential area of Willow Rise.

[52] We should accept the evidence of Mr McMillan as credible and reliable and we should refuse the application, finding the applicant liable in expenses.

Resolution of conflicts in the evidence

[53] There were three critical conflicts in the evidence which require to be resolved, viz(i) whether there was ever an agreement between the applicant and Mr McMillan that the applicant was to become tenant in his own right; (ii) if so, whether the payments to Mary McMillan which appear on the applicant’s bank statements, or some of them, were payments of rent under that agreement, and (iii) whether the lease in favour of My Neighbours was genuine.

[54] The first of these is a straightforward conflict between the applicant and Mr McMillan, the former saying the meeting at the Golden Grain Café happened and that it ended with agreement that he be the tenant of the subjects in his own right at a reduced rent of £650 per month, the latter denying both the meeting and the agreement. So we have looked for factors which might support one side or the other.

[55] The fact that payments of £1,000 per month from the applicant’s personal bank account to Mrs McMillan’s ceased in December 2012 and were followed by a series of payments of £650 is clearly consistent with the applicant’s account. These payments began on 1 March 2013. There are 22 of them at £650 and one at £649.44, as well as two payments of £3000 and one of £4000. They all bear the reference “Magic Farm Ltd” and the last payment was on 21 July 2015. (For all of this see production 8.)

[56] Meantime Raki Islam was paying rent, or having it paid on her behalf in the form of Housing Benefit, for Apartment 3 in Whittinghame House. Her bank statements are copied as production 9. They show 27 payments of £850 going to the account of Mary McMillan between 1 March 2013 and July 2015, a total of £22,950, as against the £24,650 which would have been the total due for that period.

[57] Since there are no other candidates for the £650 per month payments and since they and the lump sum payments referred to all bear the reference “Magic Farm”, we hold that these were payments of rent in respect of the subjects.

[58] In his pleadings the applicant avers that further payments, one of £8,947 on 2 November 2016 from an account held by him for something called “The Earthy School Project”, and the others, unspecified as to amount and date, from Ms Islam’s account were also rent payments under his agreement with Mr McMillan. However, the difficulty for the applicant there is that in the Sheriff Court case before Sheriff Stirling he claimed the £8,947 payment was, in part, a payment towards arrears on what the sheriff calls “the historic lease” and, as to the rest, payment in advance on the lease of the subjects then being occupied by Ms Islam and from which she was being evicted in that Sheriff Court process. The reference to a “historic lease” is presumably to the lease of Apartment 3. Certainly there is no mention in Sheriff Stirling’s Stated Case of the applicant claiming these payments were for an agricultural lease in his own name. Accordingly, we cannot hold that the payment of £8,947 was a payment of rent under such a lease.

[59] We are therefore inclined to hold, on a balance of probability, that there was an agreement between the applicant and Mr McMillan in or around January 2013, whether in said café or elsewhere is immaterial, whereby the rent of the subjects was reduced to £650 per month. However, we cannot assume from that that this agreement also involved Mr McMillan accepting the applicant as tenant in his own right. There are other factors which bear on that.

[60] The first of these is that at no time until he made this application to this court (in April 2018) did the applicant claim to anyone that he had a tenancy of the subjects in his own right. On the contrary, at court diets in March and April 2014 in the Haddington Sheriff Court litigation, he claimed that the owner of the livestock was either Mr Islam or a limited company belonging to Mr Islam, that he himself had resigned from the company (although, in truth, he was never a member of either Magic Farm or My Neighbours), and that he was merely Mr Islam’s lay representative (see paras [2] and [7] of the Court of Session judgment in that case). In other words, he did all in his power to distance himself from any personal responsibility for all that had happened, a position quite inconsistent with his being the tenant of the subjects.

[61] Secondly, he was involved in the execution of the lease in favour of My Neighbours in January 2014. On that matter we prefer the evidence of the McMillans to his because both Mrs McMillan and her daughter Velvet spoke to the trip to Haddington to sign the lease, the lease bears to be signed by him as a witness to Mrs McMillan’s signature and he admitted that the signature looked like his. Given that it was he, rather than Mrs McMillan, who had the lease in his possession and his association with Mr Johnson, who evidently prepared the lease and sent a copy of it, duly signed, to Mr McMillan, on 19 February 2014, we hold that the applicant knew perfectly well that it bore to be a replacement for the earlier lease but with a different company now named as tenant. That too is completely at odds with his holding a tenancy of the subjects in his own name at that time.

[62] Thirdly, there is the fact that rent payments for the subjects ceased in July 2015, shortly after the scheduled expiry of the lease in favour of My Neighbours (31 May 2015). Again that is not consistent with the applicant being tenant in his own right and claiming an ongoing tenancy by virtue of sec 4(2) of the Agricultural Holdings (Scotland) Act 2003 (“the 2003 Act”).

[63] Accordingly, our conclusions on the three issues identified above are (i) that there was an agreement in or around January 2013 to reduce the rent of the subjects to £650 per month and that payments of that amount, as well as other lump sum payments were made under it, irregularly, until July 2015 but (ii) that this agreement did not include acceptance by Mr McMillan of the applicant as tenant in his own right and (iii) that the lease in favour of My Neighbours, whatever its effect (which we come to below), was not a fraud or a forgery but a deed executed by the parties in an attempt to substitute My Neighbours as tenants in place of Magic Farm and that this was done with the applicant’s knowledge and co-operation, if not, indeed, at his instigation.

Discussion

[64] It is not in dispute that Magic Farm had an SLDT of the subjects starting on 1 June 2011 and intended to run until 31 May 2015. However, Magic Farm was struck-off on 7 December 2012, so could not be the tenant beyond that date. Given that My Neighbours was not incorporated until 16 December 2013, it follows that only the applicant, as an individual, could have been tenant in the interim. The fact, if fact it be, that Mr McMillan was not aware of the dissolution of Magic Farm at this point and believed it to be the tenant, may not be fatal to the existence of a lease in favour of the applicant in his own right; Morrison-Low v Paterson1985 SC (HL) 49. As to what sort of lease that was it is almost impossible to say because there was no evidence as to its intended duration. In that regard we feel unable to infer that it was the unexpired portion of the Magic Farm lease: there is simply no evidence to that effect nor anything which points to that as a necessary, or even probable, inference as to its duration. Rather, the impression we gained from the applicant was that it was from month to month indefinitely.

[65] The absence of evidence as to the term of the lease is not necessarily fatal to the existence of a lease as a duration of one year will be implied (Gray v Edinburgh University 1962 SC 157). Such implication in this case would give rise to a lease for a year from some date in January 2013 or, possibly, 8 December 2012. That would be a lease for a term of not more than five years and, therefore, an SLDT in terms of sec 4(1) of the 2003 Act, provided that it was a lease of “agricultural land” as that term is defined in sec 93 of that Act, that is to say “land used for agriculture for the purposes of a trade or business”. “Agriculture” itself has the same meaning, for the purposes of the 2003 Act, as it has for the Agricultural Holdings (Scotland) Act 1991, viz:

““Agriculture” includes horticulture, fruit growing; seed growing; dairy farming; livestock breeding and keeping; the use of land as grazing land, meadow land, osier land, market gardens and nursery grounds; and the use of land for woodlands where that use is ancillary to the farming of land for other agricultural purposes: and “agricultural” shall be construed accordingly”.” [Section 85 of the 1991 Act]

[66] There is evidence that the applicant kept livestock. He listed cashmere goats, Tamworth pigs, Hebridean sheep, Highland cows, geese, ducks, hens, chickens and turkeys as some of the livestock kept. Unsurprisingly, therefore, there is also evidence, in the way of entries in the applicant’s bank account (production 8), of payments made for things such as animal feed. What there is no evidence of is the conduct of a trade or business. It is not possible, in our view, to characterise the intended social project for the benefit of disadvantaged youngsters, about which little enough is known in any event, as a trade or business. What the agricultural holdings legislation is concerned with is the security of tenant farmers for the purpose of food production (see the speech of Lord Salmon in Johnson v Moreton [1980] AC 37 at 52) and it is those who are engaged in trade or business of that kind who are the objects of its protection. We consider the same to be true of the other forms of tenancy created by the 2003 Act; hence the insistence on there being a trade or business.

[67] Even if we are wrong in that, however, and the applicant had an SLDT of the subjects in 2013, such tenancies can be terminated by the agreement of landlord and tenant without any formality or legal process; sec 6(2) of the 2003 Act. Although both parties, for different reasons, would deny that such an agreement was reached (the applicant because he denies his claimed agreement with Mr McMillan was ever changed and Mr McMillan because he denies a lease with the applicant was ever entered into), the execution of the lease in favour of My Neighbours, in which we hold that the applicant was an active participant, must signify the entering into of a new arrangement, superseding what had gone before. In that regard, we do not regard the impossibility of the lease commencing on a date before the incorporation of the company as fatal to the lease becoming operative as from the date of incorporation.

Decision

[68] We therefore hold that this application fails for the following reasons:

(a) it has not been proved that there was ever an agreement between the applicant and Mr McMillan that the applicant was to become tenant in his own right;

(b) that, even if, notwithstanding the absence of such an agreement, the applicant was tenant of the subjects for a period from January 2013, it has not been proved that he was carrying on a trade or business for the purposes of sec 4 of the 2003 Act with the result that any lease he held in 2013 could not, therefore, have been an SLDT; and

(c) even if he held an SLDT in 2013, it was superseded by the lease entered into in favour of My Neighbours in January 2014.

[69] The application is therefore dismissed and we have allowed 21 days for motions and submissions on expenses.