Decision of the Scottish Land Court

Donald and Elizabeth MacGillivray (Appellants) v The Crofting Commission (Respondents)

Case reference SLC 30/16
before
Lord Minginish, Chairman, and John A Smith
13 October 2016

[1] This is the culmination of a decrofting application with a long procedural history. It goes back to March 2011 when the appellants applied to the Crofting Commission for a decrofting direction in respect of 1.3 ha of their croft at 37 North Ballachulish for the purpose of a housing development comprising ten houses. It has already been before this Court twice, on issues of competency (see SLC/99/13, decisions of 3 February and 18 December 2014). These issues having been resolved in favour of the appellants, it was remitted to the respondents for consideration of the application on its merits. On 5 February 2016 they issued their decision refusing the application. This appeal is against that refusal. We heard it at Edinburgh on 2 August 2016 when the appellants were represented by Mr Neil MacDougall, advocate, and the respondents by Sir Crispin Agnew of Lochnaw, QC.

[2] In March 2011 the appellants were owner-occupiers of the land in respect of which decrofting was sought, the status of “owner-occupier crofter” not yet having been introduced. Accordingly the law to be applied is to be found in secs 24(3) and 25 of the Crofters (Scotland) Act 1993 (“the 1993 Act”) as they stood before the amendments introduced by sec 43 of the Crofting Reform (Scotland) Act 2010 (“the 2010 Act):

“24. …

(3) Where a croft is vacant, the Commission may, on the application of the landlord, direct that the croft shall cease to be a croft or refuse to grant the application; and if the Commission direct under this subsection or under subsection (2) above that a croft shall cease to be a croft then, subject to subsection (4) below, this Act shall cease to apply to the croft, without prejudice, however, to the subsequent exercise of any powers conferred by this Act for the enlargement of existing crofts.

25. Provisions supplementary to s.24(3)

(1) The Commission shall give a direction under section 24(3) of this Act that a croft shall cease to be a croft if—

(a) subject to subsection (2) below, they are satisfied that the applicant has applied for the direction in order that the croft may be used for or in connection with some reasonable purpose (within the meaning of section 20 of this Act) having relation to the good of the croft or of the estate or to the public interest or to the interests of the crofting community in the locality of the croft and that the extent of the land to which the application relates is not excessive in relation to that purpose;

(b) the application is made in respect of a part of a croft, which consists only of the site of the dwelling-house on or pertaining to the croft and in respect of which a crofter is entitled at the time of the application, or has been entitled, to a conveyance by virtue of sec 12(2) of this Act, and they are satisfied that the extent of garden ground included in that part is appropriate for the reasonable enjoyment of the dwelling-house as a residence ; or

(c) the application is made in respect of a croft the conveyance in feu of which was granted under sec 17 or 18 of the 1955 Act.

(2) Without prejudice to subsection (1)(b) or (c) above, the Commission, in determining whether or not to give such a direction, shall have regard to the general interest of the crofting community in the district in which the croft is situated and in particular to the demand, if any, for a tenancy of the croft from persons who might reasonably be expected to obtain that tenancy if the croft were offered for letting on the open market on the date when they are considering the application.”

Cases

Associated Provincial Picture Houses Ltd v Wednesbury Corp [1948] 1 KB 223
Bonnes v West Lothian Council 1997 SLT 938
Eunson v The Crofting Commission SLC/13/15, decision of 1 March 2016
Ferguson v The Crofters Commission 1999 SLCR 102
Ishak v Thowfeek [1968] 1 WLR 1718
MacDougall v The Crofting Commission SLC/75/14, decision of 26 May 2016
Moray Council v Scottish Ministers 2006 SC 691
Noble v City of Glasgow District Council 1995 SLT 1315
Puhlhofer & Anr v Hillingdon London Borough Council [1986] AC 484
Ritchie v Aberdeen City Council 2011 SC 570
Secretary of State for Scotland v Sutherland 1984 SLCR 53
South Buckinghamshire District Council & Anr v Porter (No 2) [2004] 1 WLR 1953
Wordie Property Co Ltd v Secretary of State for Scotland 1984 SLT 345

Submissions

For the appellants

[3] For the appellants Mr MacDougall submitted arguments under grounds (d), (e) and (f) of sec 52A(3) of the 1993 Act: that the respondents took into account certain irrelevant or immaterial considerations; that they failed to take into account certain relevant or material considerations; and that they exercised their discretion in an unreasonable manner.

[4] Before addressing each of those grounds in turn, Mr MacDougall made some general comments about the respondents’ decision letter. He highlighted the respondents’ recognition of the fact that the existence of a reasonable purpose for decrofting gave rise to a “strong presumption” that it should be granted. The respondents accepted that the terms of subsec 25(1)(a) of the 1993 Act were satisfied: that there existed a reasonable purpose for decrofting having relation to the good of the croft or of the estate or to the public interest or to the interests of the crofting community in the locality of the croft and that the extent of the land was not excessive in relation to that purpose. That gave rise to the foresaid strong presumption. The presumption could only be overcome if the considerations referred to in subsec (2) of sec 25 outweighed it. The respondents were right, therefore, to acknowledge, as they did further on in their decision letter, that strong evidence of a substantially adverse impact upon the general interests of the crofting community in the district in which the croft was situated would be required to overcome the presumption.

[5] The factual basis narrated in the Commission’s letter was not in dispute. Thus it was not disputed that North Ballachulish comprised a crofting community for the purposes of the Act, nor that there had been expressions of interests in the land from four individuals, nor that what was to be decrofted comprised a sizeable part of the croft, leaving only 0.4 ha should decrofting be granted, nor that the land to be decrofted was good quality agricultural land.

[6] With that, Mr MacDougall turned to the individual grounds of appeal:

(i) That the respondents took account of irrelevant or immaterial considerations – sec 52A(3)(d)

[7] The respondents did not have a completely free hand in deciding what they could and could not take into account: that was decided for them by sec 25(2) of the Act which limited their consideration to two factors; the general interest of the crofting community in the district and the demand, if any, for a tenancy of the croft from persons who might reasonably be expected to obtain the tenancy were it to be offered for let on the open market.

[8] In deciding that granting the application would be to the detriment of the general interest of the local crofting community, the respondents had relied upon six factors, all of them irrelevant or immaterial.

[9] The first was the size of the township. This was not a relevant or material consideration when considering the interests of the crofting community. That was true whether one measured the size of the township by the number of crofts it comprised or its geographic extent. There were 17 crofts in North Ballachulish. The appellants were applying to decroft only part of their croft, so 17 crofts would remain even if their application was granted. Even if the decrofting had applied to the whole croft, a reduction from 17 to 16 crofts was not of any detriment to the other crofters.

[10] In terms of area, only 1.3 ha was to be decrofted. In a context where there were 295 ha of common grazings, that, too, was immaterial. Although the land to be decrofted was described in the SGRIPD (Scottish Government Rural Inspections and Payment Directorate) report as “good quality permanent pasture”, pasture was all it was. It had been used only for grazing for many years.

[11] Asked whether he was saying that the Commission had not been entitled to look at the size of the township at all, or, alternatively, that, having looked at it, they had given it too much weight, Mr MacDougall’s position was (a) that having looked at it they should have decided it was neither relevant nor material for the purposes of sec 25(2) but, (b) esto it was relevant or material, they had attached undue weight to it.

[12] The second matter said to be irrelevant or immaterial was the demand from potential tenants. Its relevancy and materiality had to be tested from the point of view of the local crofting community; in other words, the persons already crofting in North Ballachulish. On the evidence, it was of little or no interest to them. One of their number had had use of the land for grazing her horses but that was the extent of community benefit from this land in its present form. It had not been used for any purpose other than grazing for about 50 years. As such, were a new person to come in from outside and take over the croft, that would be of no relevance or interest so far as the existing crofters were concerned. The situation may have been different had the land been actively farmed and been of importance to the community in that way but that was not the case. In any event there had been only four expressions of interest of which only one was local, from Ms Linda MacLachlan, who wanted to use it only for grazing.

[13] Asked whether it was not enough, to make this a relevant and material consideration, that existing crofters might welcome new blood from outside, Mr MacDougall accepted that it was but pointed out that in this case there had been relatively few expressions of interest from any source. The demand was therefore insignificant and immaterial. Linda MacLachlan being only one of 17 crofters, that was an immaterial level of internal demand. One could not prescribe a threshold but demand must be significant in its context and one crofter out of 17 was not.

[14] Thirdly, the limited opportunity to satisfy that demand elsewhere in the township was an irrelevant and immaterial consideration. Mr MacDougall dealt with this point very shortly: it must necessarily follow from the proposition that the demand for croft land within the community was immaterial that the fact that there may be only limited opportunity to satisfy that demand elsewhere was also immaterial. In any event, given that the only internal candidate wanted to use the land only for grazing, the fact that there were 295 ha of common grazing available meant that there was ample opportunity elsewhere in the township to satisfy the demand.

[15] Fourthly, exception was taken to the size and location of the area to be decrofted compared to the size and location of the croft as a whole being taken as a relevant and material consideration.

[16] It was accepted that granting the application would reduce the size of the croft from 1.7 ha to 0.4 ha. However, it did not follow that something which had an impact on a croft also had an impact on the crofting community. Sec 25(2) required the interests of the community, not the interests of the croft to be taken into account. The size and location of the area proposed to be decrofted was of no consequence to the crofting community here. As such, it was both irrelevant and immaterial. One could not look at this in isolation. One had to look at the size of the township. Had we been talking about a five croft township the loss of this land might have been material but not in a crofting community of the size of North Ballachulish. This was not to be looked at as a matter of policy: there had to be some reason why the size of the croft and its location was of some significance to the local crofting community.

[17] Fifthly, objection was taken to consideration of the agricultural potential of the croft. This, too, could only be taken into consideration insofar as it related to the interests of the crofting community. The fact was that the crofting community was not interested in the agricultural potential of this croft: the only expression of interest in taking it on was from somebody who wanted to use it for grazing. So its potential for other uses was irrelevant.

[18] Finally, the sixth factor taken into account by the respondents was also irrelevant. This was the impact of the loss of the decrofted area on the croft as a whole. This was objected to on much the same grounds as previously argued. The local crofting community had little or no interest in how this croft was (or was not) being used, so the impact of the loss of the land on the croft was irrelevant.

[19] In summary, the relevancy and materiality of all of the considerations on which the respondents had relied must be viewed through the eyes of the crofting community in North Ballachulish as at the date the application was made. What was notable by its absence was any evidence of strong opposition from the majority of that community. Only three objections had been received from a community of 17 crofters. The reason for that, it was submitted, was that the factors upon which the respondents had relied were of no materiality to the local crofting community.

(ii) That the respondents failed to take into account relevant or material considerations – sec 52A(3)(e)

[20] Under this head Mr MacDougall submitted that the respondents had failed to take into account factors which were favourable to the crofting community’s interests: they had expressly listed only those they considered to be detrimental. They had devoted only the following sentence to the favourable aspects of the application: “In carrying out this balancing exercise, the Commission has given weight and consideration to the recognised reasonable purpose (and the presumption arising therefrom) and the associated public interest in decrofting land and using it for a housing development, including affordable housing”.

[21] At this point Mr MacDougall made a submission which we have found difficult to fit into the rest of his argument. It was that, in taking this approach, the respondents had misdirected themselves in relation to the operation of sec 25. Subsection (1)(a) was a gateway provision, not a factor to be taken into account in the balancing exercise under sec 25(2). It was a factor which determined whether the balancing exercise took place at all. The balancing exercise required the respondents to balance only the interests of the crofting community, not the public interest. The public interest was relevant only in relation to sec 25(1)(a). The public interest was wider than the interests of the crofting community. It included the interests of members of the public who would benefit from securing the housing. Their interests were relevant under subsec (1)(a) but not under subsec (2), although what was of benefit to the wider public – the benefits deriving from 10 new homes in North Balluchulish – was also likely to be of benefit to the crofting community. We say this submission is difficult to fit into the rest of the appellants’ case because that case is so heavily dependent on weighing the public interest benefits of decrofting against any detriment to the crofting community.

[22] However, our difficulty with this submission does not detract from Mr MacDougall’s essential point under this ground of appeal, which was that the respondents had failed to take account of the positive effects of the appellants’ proposal on the crofting community. The SGRPID report said that the proposed decrofting would have both negative and positive effects on the crofting community. It accepted that increased numbers of residents in the township would lead to increased demand for the local school and lessen the risk of closure. It had also said “There are likely to be other socio-economic benefits from the construction of the new houses and from having additional families in the township”. These positive aspects were not reflected in the respondents’ determination. Given the fact that they had expressly enumerated the individual factors which they considered detrimental to the interests of the crofting community, one could only infer, from their failure to do likewise in respect of the positive aspects, that there had been a failure to take the positive aspects into account.

(iii) That the respondents had exercised their discretion in an unreasonable manner – sec 52A(3)(f)

[23] Mr MacDougall acknowledged that the test which an argument under this ground of appeal had to satisfy was a high one. However, it was passed here.

[24] The starting point was the respondents’ acknowledgement that there was a strong presumption in favour of decrofting where the applicants had shown reasonable purpose. Given the recognised strength of that presumption, it could only be overcome if the interests of the crofting community would be seriously and detrimentally affected by the decrofting. For the reasons given, no proper balancing act in relation to the interests of the crofting community had been carried out here. That failure had led the respondents to conclude that the loss of approximately 1 ha of grazing land was so detrimental to the crofting community of North Ballachulish that it outweighed all the benefits that the introduction of ten new houses and families would have. Moreover the detriment was reckoned to be so strong that it outweighed the benefits to such an extent that it defeated the strong presumption in favour of decrofting identified at the outset of the respondents’ determination.

[25] The decision-making process here was in two stages; (i) the assessment of reasonable purpose and enquiry as to whether the extent of the land to be decrofted was excessive in relation to that purpose (subsec (1)(a)) and (ii) determining whether the general interest of the crofting community in the district outweighed the presumption that the application be granted (subsec (2)). In relation to that balancing exercise the main factors in favour of granting decrofting were as follows; (i) that the construction of ten new houses would introduce new families to the community with all the socio-economic benefits which went with that, chief of which was the chance to save the local school from closure, (ii) that the land and croft in question had for many years been used only for grazing and that the only expression of interest in the land from a local person was for that purpose, and (iii) that there was no strong opposition to the application from the local crofting community. In relation to this last point, only two objections had been received from that community and it was of some significance that they were from a mother and daughter. The vast majority of the crofting community had not objected at all. So there was a real danger of putting the interests of the few ahead of the interests of the community.

[26] On the other side of the balance there was only one factor: that 1.3 ha of good quality land would be lost to crofting for ever and that any future agricultural use of the remaining croft would be rendered impossible. The significance of that factor was diminished by the fact that the land had been used, and was proposed to be used, only for grazing.

[27] Moreover, this balancing act did not begin with a perfectly balanced set of scales; they were already weighted heavily in favour of granting the application by virtue of the presumption which arose from the existence of a reasonable purpose.

[28] The fundamental question which the respondents had to determine was what would be of greater benefit to the interests of the crofting community at North Ballachulish, the preservation of 1.3 ha of grazing land or the introduction of ten new houses and families to the local area. Faced with that choice, no reasonable body would have exercised its discretion in the same manner and arrived at the same conclusion as the respondents had.

[29] Mr MacDougall closed by formally moving us to quash the respondents’ decision of 5 February 2013 and direct them to grant the application.

Submissions for respondents

[30] Sir Crispin moved us to sustain one or more of the respondents’ pleas-in-law and refuse the appeal.

[31] Before turning to his written Note of Argument, he made submissions on certain matters which had been advanced by Mr MacDougall.

[32] Mr MacDougall’s submission on the proper construction of sec 25 proceeded on a wrong approach. Subsection 25(1)(a) was not a gateway. It simply required assessment of the stated purpose to be carried out in relation to the various interests listed there and that the extent of the land to be decrofted for that reasonable purpose should be addressed.

[33] Secondly, Mr MacDougall had misconstrued the decision letter. In relation to a reasonable purpose all it was saying in the sentence “The Commission acknowledges that as an application for a proposed housing development, this constitutes a reasonable purpose within the meaning of section 20 of the Act and section 25(1)(a) of the Act” was that the building of houses was one of the reasonable purposes set out in sec 20. The law was clear, however, that in the assessment of reasonable purpose in the context of any particular case, the purpose had to be reasonable in all the circumstances of that case; Secretary of State for Scotland v Sutherland. So it was not enough that the stated purpose for decrofting was one listed in sec 20; one had to go on to consider whether that purpose was reasonable in the whole circumstances of the case.

[34] Sir Crispin then addressed sec 24(3), laying emphasis on the phrase “The Commission may … direct that the croft shall cease to be a croft”. On its terms, that conferred on the Commission a “wide-open discretion” but it was accepted that it was qualified by sec 25(1)(a) which said “The Commission shall give a direction under section 24(3) of this Act that a croft shall cease to be a croft if [inter alia reasonable purpose is shown]”. But even the application of sec 25(1)(a) required that the Commission be satisfied in all the circumstances that the decrofting was reasonable in relation to the good of the croft, or the estate or the public interest. It remained a very wide discretion. All subsec (2) said was that the Commission, in determining whether to make a decrofting direction, was to have regard to the general interest of the crofting community and, separatim, demand for the tenancy. In relation to demand, that was not confined to demand from within the existing crofting community.

[35] Asked whether the cases which speak of sec 25(1)(a) as giving rise to a presumption were wrong, Sir Crispin’s answer was that sec 25(1)(a) got you half way there but did not give rise to any presumption. An applicant for decrofting was entitled to a decrofting direction only if it was reasonable in the whole circumstances. The respondents had gone too far in their decision letter by referring to the existence of a strong presumption; what was involved was a balancing act in the conduct of which they were given a very wide discretion. Under reference to Ishak v Thowfeek [1968] at pages 1724-1725, it was submitted that if subsec (2) had been intended to be restrictive as to the matters to which the Commission could have regard, it would have said so.

[36] Turning to his Note of Argument, Sir Crispin addressed us first on what was required in a statement of reasons. He did so under reference to the well-known authorities in that area, including Wordie Property Co Ltd v Secretary of State for Scotland and South Buckinghamshire DC v Porter (No. 2). However, since no point is taken in this appeal in relation to the form and content of the respondents’ decision letter as a statement of reasons we need not rehearse the detail of these submissions.

[37] The following propositions are of greater relevance. In the first place a consideration was material if the decision-maker decided that it is one that ought to be taken into account, but, having taken it into account it was open to the decision-maker to decide that other considerations outweighed it; Ritchie v Aberdeen City Council per Lord Justice Clerk Gill at paragraphs [11] to [12].

[38] Secondly, it was for the decision-maker to decide what the determining issues were and what conclusions should be drawn from them; Moray Council v Scottish Ministers per Lord Justice Clerk Gill at paragraphs [29] and [30].

[39] Thirdly, in a case such as this, where an evidential hearing has been conducted, it was to be presumed that the decision-maker had taken everything relevant into account; Noble v City of Glasgow District Council.

[40] Fourthly, in assessing whether the decision-maker had exercised his discretion in an unreasonable manner, an appeal court should exercise great restraint; intervention required “unreasonableness verging on an absurdity” (Puhlhofer and Another v Hillingdon London Borough Council at page 518 B to E) or a decision to be “so outrageous in its defiance of logic … that no sensible person who had applied his mind to the question to be decided could have arrived at it”, or the consequences of the decision to be such that the decision-maker “must have taken leave of his senses” (dicta quoted by Lord Osborne in Bonnes v West Lothian District Council page 402 I to K). Bonnes was a planning case but this Court had already shown itself to be prepared to follow what had happened in planning cases; Eunson v The Crofting Commission at paragraph [68].

[41] However, in another recent decision of this Court – MacDougall v The Crofting Commission – the Court had gone too far in carrying out a balancing act itself, something which was only for the Commission as decision-makers to perform. Not all of the cases to which reference was now being made had been put before the Court in that case, resulting in the Court adopting too low a threshold for intervention; one short of perversity, outrageousness etc.

[42] In this case the respondents had taken account of the matters which they ought to have taken into account. In terms of demand for the tenancy, they had considered four individuals. Their suitability had been challenged but the respondents had made a judgement on that, as was their right. The respondents had also taken into account the quality of the land to be decrofted. In that regard, Mr MacDougall had been wrong to confine himself to the use made of the land in the past; the Commission were entitled to look at what use could be made of it in the future. Some of those who had expressed interest had said that they would like to grow vegetables. One had said that he had grown vegetables on a neighbouring croft. That, together with the MacAulay Land Institute assessment of the soil, proved its potential for agricultural activity going beyond grazing. The respondents had considered it detrimental to the interests of the crofting community to remove the land, given the level of interest expressed in it. What weight they attached to the various factors to be taken into account was a matter for them.

[43] Mr MacDougall had also been wrong (in considering the respondents’ reliance on limited opportunity to satisfy demand elsewhere in the township) to equiparate inbye land with common grazings. One could not take a silage crop from common grazings.

[44] It could not fairly be said that the respondents had failed to take account of the factors in favour of granting the application. Bringing housing into the area had been taken into account: that was what had satisfied them in relation to public interest under sec 25(1)(a). It had been acknowledged that the people who were to live in these houses, although not themselves crofters, would, nevertheless, benefit the community in terms of helping keep the school open and spending money in the community.

[45] The respondents’ Statement of Reasons complied with the law. They had identified the main material considerations, addressed them, weighed them and explained their decisions in relation to them in such a way that any informed reader would know precisely why they had decided as they had. Mr MacDougall’s argument was an attempt to substitute the appellants’ view of matters for that of the respondents. The Court should therefore refuse the appeal but if we were minded to allow it, unless we thought there was material prejudice in doing so, we should remit the matter to the respondents to be reconsidered in the light of any guidance we chose to give. In summary, however, this was not a case in which one could say that there was only one decision which could possibly have been arrived at. On the contrary, the decision arrived at was one which the respondents had been entitled to make in all the circumstances of the case.

[46] Sir Crispin dealt, more briefly, with the individual grounds of appeal. In relation to the first, he submitted that the respondents had been entitled to take into account the six matters listed as relevant and material considerations in relation to the detrimental impact of the proposal on the croft and on the general interest of the crofting community in North Ballachulish.

[47] In relation to the second ground of appeal, the decision letter did not require to set out every submission made, nor every issue raised, but only the considerations which the decision-maker considered material. So there was no need to refer specifically to the positive benefits identified in the SGRPID report. It was sufficient that they had, as the decision letter recorded, given “weight and consideration to the recognised reasonable purpose (and the presumption arising therefrom) and the associated public interest in decrofting the land and using it for a housing development, including affordable housing”. It could not, therefore, be said that the respondents had failed to take into account a material consideration.

[48] In relation to the third ground of appeal, having regard to the wide discretion afforded to decision-makers such as the respondents, their decision in this case could not be said to have fallen outwith the range of decisions open to them. It could not be described as Wednesbury unreasonable, or absurd or perverse.

[49] For all of these reasons the appeal should be refused.

Mr MacDougall

[50] Mr MacDougall made some brief points in reply.

[51] He understood Sir Crispin to have been arguing that the requirements for giving rise to a presumption had not been satisfied in this case. However, the only reasonable reading of the respondents’ decision letter was that they accepted that the presumption did apply. So the Court did not have to address the question whether a reasonable purpose had been established having regard to the whole circumstances of the case in the same way as it would have to were this a sec 20 application. The acceptance, by the respondents, that the purpose stated gave rise to a strong presumption in favour of decrofting obviated the need for that.

[52] Mr MacDougall adhered to his position that sec 25(1)(a) was a gateway provision.

[53] With particular reference to Ritchie v Aberdeen City Council, the proposition which emerged from paragraph 12 of the Lord Justice Clerk’s opinion was that whilst a decision-maker was entitled to find that a material factor was outweighed by certain other factors, it was still incumbent upon the decision-maker to explain how he had dealt with that factor.

[54] Finally, Sir Crispin’s attempt to portray Wednesbury unreasonableness as requiring something approaching “borderline insanity” was an impermissible extension of the law.

Discussion and decision

[55] Before coming to the individual grounds of appeal, we wish to deal with two issues which arise as to the correct approach to be taken in a case of this kind.

[56] The first is the relationship between subsecs(1)(a) and (2) of sec 25. We do not think it is accurate to describe sec 25(1)(a) as a “gateway provision” to subsec (2) which operates in such a way that once the gateway is open all that matters is the general interest of the crofting community in the district and there is to be no further reference to any wider public good. That approach seems to us to have the potential to elevate subsec (2) into something of a veto over subsec 1(a) in as much as, if subsec 1(a) is only a gateway provision and public interest cannot be taken into account once the gateway opens up, the interest of the crofting community would be determinative of the whole question: there would be no subsequent stage of balancing detriment to the crofting community against benefit to wider public interests. Thus, where the overall effect on the crofting community was detrimental, no amount of benefit to the wider public could outweigh it. That is not what the Act says. What it says is, simply, that in coming to a decision as to whether to grant a decrofting direction for a reasonable purpose relating to one of the interests mentioned in subsec (1)(a) the Commission is to “have regard to the general interest of the crofting community in the district in which the croft is situated and in particular to the demand, if any, for a tenancy of the croft from persons who might reasonably be expected to obtain that tenancy if the croft were offered for letting on the open market on the date when they are considering the application”. It is also almost the opposite of what the Court said in Ferguson (at page 94) about the proven existence of a reasonable purpose under subsec (1)(a) giving rise to a “strong presumption” in favour of decrofting.

[57] Accordingly we reject Mr MacDougall’s two-stage approach to subsecs (1)(a) and (2). Instead, in our view, the correct description of the respondents’ task is that they required to balance the public interest, which, they accepted, favoured decrofting, against the crofting interest, which did not.

[58] The second issue to be resolved is the viewpoint from which the relevancy and materiality of the factors to be taken into account has to be seen. Under reference to the definition of “crofting community” in sec 61(1) of the Act, Mr MacDougall discussed community in terms of the persons who occupied crofts in North Ballachulish or held shares in the associated common grazings at the time of the application. We agree that it is the general interest of that community which has to be taken into account when applying sec 25(2): there is no reference in the papers to any wider area. Mr MacDougall went further, however, and argued that it was solely from the point of view of those already crofting in North Ballachulish that the relevance and materiality of the various factors to be taken into account was to be gauged. We think that argument goes too far. It makes the views of the present crofters and shareholders determinative. It leaves no room for any wider or more long-term assessment.

[59] The Commission always take account of views expressed by members of a crofting community as to the effect of a decrofting proposal on their interests but they are ultimately obliged to view matters more objectively and from the point of view of the crofting community as an entity distinct from its constituent members from time to time. The obligation to have regard to population retention and the sustainability of crofting is now enshrined in sec 2A of the 1993 Act, a provision introduced by sec 2(1) of the 2010 Act (and, therefore, not in force when the present decrofting application was lodged) but we think that is the approach which has been taken by the Commission ever since decrofting was first permitted by sec 16(9) of the Crofters (Scotland) Act 1955. Section 1 of the 1955 Act, which set up the present Commission, conferred on the new body “the functions of reorganising, developing and regulating crofting in the crofting counties of Scotland, promoting the interests of crofters there and keeping under review matters relating to crofting”. Crofting was seen as an activity and a way of life worthy of development and the new Commission was charged with seeing to it. Accordingly the Commission has had a strategic and monitoring role ever since its inception; a role which obliges it to look to the future as well as the present. Accordingly, in so far as Mr MacDougall’s approach excludes that wider view, we reject it. The outworking of that will be seen below.

[60] Against the background of these introductory remarks, we turn to the individual grounds of appeal.

(i) That the respondents took account of irrelevant or immaterial considerations – sec 52A(3)(d)

[61] Mr MacDougall, as we understood him, made a distinction between what was irrelevant and what was immaterial. Something which was in principle relevant might turn out, once looked at in its context, to be immaterial. His primary position was that all six factors relied upon by the respondents in refusing the application were both irrelevant and immaterial but esto some were relevant they were all immaterial.

[62] Since the Act uses both terms, we have to assume that a distinction is intended and that they are not just two ways of saying the same thing. So we have to consider them separately. There is no difficulty with the concept of relevancy and we are satisfied that all six factors – the size of the township, the demand from potential tenants, the limited opportunities to satisfy that demand elsewhere in the township, the size and location of the area to be decrofted relative to the size and location of the croft as a whole, the agricultural potential of the croft, and the impact of the loss of the decrofted area on the croft as a whole – were all relevant to the decision the respondents had to make. Thus the size of the township is relevant in order to put the decrofting application in context (other things being equal, the decrofting of a small area in a large township is likely to be less detrimental than the decrofting of a large area in a small one); the evidence of demand for a tenancy is something which the Commission are statutorily obliged to consider in terms of sec 25(2); the limited opportunity to satisfy demand elsewhere in the township affects the significance of demand in relation to the area to be decrofted; the size and location of the area to be decrofted relative to the size and location of the croft will have significance in relation to the effect of the proposal on the sustainability of the croft; the agricultural potential of the land to be decrofted will be relevant to measuring the loss which decrofting will cause; and, in a variation of a point already made, evidence that the loss of the area to be decrofted would have a major impact on the croft as a whole will be relevant to the future working and letting potential of the croft.

[63] We have had greater difficulty with the concept of materiality. It may be thought to have more to do with the significance of a particular factor, seen in context. This in turn shades into the weight to be attributed to it, an area in which an appeal court must exercise caution. Clearly we cannot substitute our own view as to the weight to be given to a particular factor for that of the respondents, yet the Act requires us to consider materiality.

[64] The New Shorter Oxford English Dictionary defines “material” when applied to evidence or a fact in a legal context as “significant, influential, esp. to the extent of determining a cause, affecting a judgement, etc”. Bearing in mind that it is for the respondents, as the decision-making body, to assess what significance or influence a particular consideration has in its context, it seems to us that we could hold them to have erred in this respect only if we were of the view that the factors taken into account could not have such significance or influence as might have a bearing on their determination.

[65] It does not seem to us that we can reach that conclusion in relation to any of the factors on which the Commission relied. In part that is for the same reasons as we held them to be relevant but some of the factors require more specific comment.

[66] The first is the level of demand. As has already been noted, that was something to which the respondents were statutorily obliged to have regard by subsec (2). On this occasion there were four expressions of interest in the tenancy. Mr MacDougall made the point that only one of those came from within North Ballachulish. That is true but irrelevant. Subsection (2) contains no restriction of that kind, only requiring that the demand must be from “persons who might reasonably be expected to obtain that tenancy”. The respondents were obliged to consider all of them to see whether that requirement was satisfied. They concluded “that the demand expressed is suitable and credible taking into account the land use experience and qualifications, experience of working with livestock and cropping experience of the individual expressing an interest in obtaining a tenancy of this croft.” That conclusion is not challenged in this appeal (as it might have been under sec 52A(3)(b) had it been thought to be inadequately supported by evidence). Nothing entitles us in that situation to say that that was an immaterial level of demand. Indeed we have difficulty in imagining a situation in which even one credible expression of interest could be ignored as being immaterial.

[67] The second is the size of the area to be decrofted relative to the croft and to the township. The SGRPID report opens with the words “If the proposed decrofting were to be approved this would have a major impact on croft 37 North Ballachulish as it would only leave the small section of croft, approximately 0.40 ha, between the shore and the A82 road. There are currently planning restrictions on the land between the shore and the A82 preventing any development.” It cannot, therefore, be disputed that decrofting would have a material impact on the viability of the croft. That was something to which the respondents were entitled to have regard because it bore on the general interest of the local crofting community. It meant, in effect, that if decrofting was granted there would be one less viable croft in the township. The consequence is that, although the area to be decrofted was small in relation to the area of the whole township, its loss would produce a result which impacted on the crofting community. Mr MacDougall argued that the loss of one croft out of 17 was immaterial. In our view such a simplistic arithmetical approach is wrong. The respondents have to consider the whole context. It may be that in a large township with several vacant crofts the loss of one could truly be said to be immaterial. But not in a relatively small township with no vacant crofts and evidence of credible interest in the tenancy should it become available.

[68] A further issue is the quality of the land. Mr MacDougall argued that the fact that it had been used only for grazing for the past 50 years and was wanted only for grazing now meant that its loss was immaterial. In our view, however, the respondents were not only entitled but obliged to take account of the fact that it was good quality land, capable of producing a crop, and not to confine themselves either to the use that it had been put to in the past nor the use for which interest had been expressed in it presently. They had to look at the potential of the land for other use in the future. In that context, it cannot be said that the quality of the land was an immaterial consideration.

[69] In our opinion all the factors relied upon by the respondents had the potential to (legitimately) affect their judgement. Accordingly they were material as well as relevant. This ground of appeal therefore fails.

(ii) that the respondents failed to take into account relevant or material considerations – sec 52A(3)(e)

[70] The respondents’ decision letter records the purpose for which decrofting is sought, acknowledges it to be a reasonable purpose and says that it gives rise to a strong presumption in favour of decrofting. It refers to the proposed development of 10 house sites. It seems to us, therefore, that full account was taken of the purpose for which the land, once decrofted, was to be used. It is true that the beneficial effects of increased population in terms of the potential for strengthening the local economy and boosting the roll of the local school are not specifically mentioned but it can hardly be imagined that the respondents failed to consider them: they are such an obvious consequence of a 10 house development in a relatively small community. Moreover, as the following passage from the Inner House decision of Noble v City of Glasgow District Council makes clear, it is not necessary that a decision such as this mentions each and every factor taken into consideration:

“It is not necessary for the licensing authority when giving reasons to write something which resembles a judicial judgment of the kind appropriate to a contested litigation in the sheriff court or in the Court of Session. Nor is it necessary that the letter containing the reasons should canvass each piece of evidence or each assertion and say specifically whether or not it has been accepted or what effect, if any, it has had in the deliberations of the licensing authority. If the letter states that the authority have had regard to the evidence and to the productions it is not possible for this court to go behind such a statement, unless something else makes it clear that the authority have not had regard to such material.”

[71] In the present case the decision letter says “In carrying out this balancing exercise, the Commission has given weight and consideration to the recognised reasonable purpose (and the presumption arising therefore) and the associated public interest in decrofting the land and using it for a housing development, including affordable housing”. Mr MacDougall argued that we could go behind that statement because the individual benefits deriving from the proposed use of the land had not been listed in the same way as the factors militating against decrofting had been. But that, in our view, is a complaint about form, not substance. In our opinion there is nothing in the decision letter which, in the words from Noble just quoted, “makes it clear that the authority have not had regard to such material”. This ground of appeal is, therefore, repelled.

(iii) That the respondents had exercised their discretion in an unreasonable manner – sec 52A(3)(f)

[72] At para [57] above we described the balancing exercise which the respondents required to carry out. It was an exercise of some difficulty because, although the use of the mandatory wording “shall give a direction” (in subsec (1)(a)) weighs the balance in favour of decrofting to the extent of creating the foresaid strong presumption, the statutory wording does not tell the respondents what weight they are to give to the interests of the crofting community within a broad range bookended by the requirements, at one end, that it is not to be ignored and, at the other, that it is not to operate as a veto. The result is that the respondents are free to attach such weight to it as they see fit, always within these parameters. In this case they acknowledged the existence of the foresaid strong presumption and that a “substantially adverse” impact on the general interest of the local crofting community was required in order to overcome it. Sir Crispin submitted that they need not have gone that far but that is the exercise they set themselves and in doing so they were following what had been said in Ferguson. Under this head of appeal we have to ask whether any reasonable tribunal could have concluded that there was here such an adverse impact on the general interest of the crofting community that it outweighed the presumption arising from the existence of a reasonable purpose.

[73] In addressing that question, we remind ourselves that, having put all of the relevant and material factors and none that were irrelevant or immaterial into the balance, it was for the respondents to decide what weight to attach to each; Lord Clyde in City of Edinburgh Council v The Secretary of State for Scotland at page 44B-D. As was said by Lord Malcolm, delivering the opinion of the Court in Loch Hill Windfarm (Scotland) Ltd v The Scottish Ministers at para [17], “The court is concerned only with the legality of the process. It is for the decision-maker to assess the facts and weigh the relevant considerations”.

[74] Nevertheless the possibility that the decision-maker exercises his discretion unreasonably remains. Sir Crispin drew attention to the various formulations of the relevant test contained in the authorities to which he referred; see para [40] above. “Unreasonableness verging on absurdity” (taken from Puhlhofer at page 518B-E) encapsulates it as well as any. Only if there is unreasonableness of that order are we entitled to set the decision aside.

[75] We are unable to conclude that there is. Unlike the situation in MacDougall, where, it seemed to us, there was no identifiable detriment to the interests of the crofting community to be put into the balance against decrofting and the respondents were really simply applying a policy, here there was a cogent case against decrofting. It was made up of the factors on which the respondents relied and which they listed in their decision letter. It is entirely conceivable that a different body may have come to a different decision. The case in favour of decrofting is a strong one. But it cannot be said that a conclusion that the loss of one viable croft out of a township of 17, in a situation where there was demand for croft tenancies and no vacant crofts from which that demand could be satisfied, amounted to a substantially adverse impact on the crofting community sufficient to overcome the presumption in favour of decrofting was verging on the absurd or, to use another of the formulations from the authorities, such as to make us think that the respondents had taken leave of their senses. Instead it was a decision which they were entitled to reach and one with which we are not entitled to interfere. This ground of appeal, therefore fails and with it the appeal as a whole.

Expenses

[76] Following our usual practice we have allowed 21 days for submission of motions and submissions on expenses.