THE COURT

(Sheriff MacLeod, Mr D J Houston)

BROWN v CROFTERS COMMISSION

(Application SLC 78/12 – decision of 16 January, 2014)

CROFTING - APPEAL AGAINST DECISION OF CROFTERS COMMISSION CONSENTING TO ASSIGNATION OF GRAZING SHARES - WHETHER COMMISSION HAD TAKEN ADEQUATE ACCOUNT OF LOCAL DEMAND - WHETHER COMMISSION HAD ERRED IN DECIDING THAT RE-UNITING SHARES WITH THE CROFT TO WHICH THEY HAD ONCE PERTAINED WAS IN BEST INTERESTS OF CROFTING COMMUNITY - WHETHER DIFFERENT CONSIDERATIONS APPLICABLE WHEN BEING ASSIGNED AS DEEMED CROFTS UNDER SEC 3(5) OF 1993 ACT AS OPPOSED TO GRAZINGS SHARES UNDER SEC 8(7)

The former owner-occupier of a croft known as 1 Barrapoll, Tiree, sold the croft to a Mr MacArthur. Separatim he applied to the Crofters Commission (as they then were) for consent to the assignation of two grazing shares in the Barrapoll Common Grazings, which had pertained to the croft, to Mr MacArthur. The application was objected to by a majority of the other shareholders. It having been granted, four of them asked the Commission to state a case for the opinion of the Court. When the case was stated and lodged with the Court only Mr Brown insisted on the appeal. In deciding to grant consent to the assignations the Commission took the view that it was in the interests of the sustainable development of the crofting community to re-unite the shares with the croft to which they had pertained. The appellant argued that the Commission had not taken adequate account of demand for the shares from existing shareholders. Moreover, the shares fell to be treated as deemed crofts in their own right in terms of sec 3(5) of the Crofters (Scotland) Act 1993 and should have been treated as such. The Commission had erred in law in holding that they could not or should not be held separately from the croft to which they had pertained. They should instead have been assigned to other shareholders in the grazings.

HELD appeal refused. The Commission had not failed to take account of local demand. On the contrary, they had expressly taken it into account but had, on balance, held that it was more beneficial for the sustainable development of the local crofting community to re-unite them to 1 Barrapoll, which would otherwise have no share in the grazings. What weight to give the competing factors was a matter for the Commission in the exercise of their discretion and the decision they had come to was within the range of decisions available to them on the facts of the case. The Commission’s decision-making involved no error of law, the procedure for assignation of a share in common grazings, whether arising from sec 3(5) or sec 8(7) of the Act, being the same and being governed, in both cases, by secs 8 and 58A of the Act.

The Note which accompanied the Court’s Order was as follows:-

Introduction

[1] This is an appeal by way of stated case against a decision of the respondents to consent to the assignation of two shares in the machair and two shares in the sliabh of Barrapoll (otherwise Barrapol or Barrapool) Common Grazings in Tiree. The application was made by Mr Cameron MacLean who had been, we understand, the owner-occupier of croft number 1 Barrapoll but had sold the heritable proprietorship of the croft to Mr Ian MacArthur. The shares in question had pertained to 1 Barrapoll and the application was by Mr MacLean for consent to assign them to Mr MacArthur.

[2] The application was objected to by Mr I C Brown, then Clerk to the Barrapoll Common Grazing Committee, on behalf of “a large majority of the shareholders greatly opposed [to] this assignation”: letter of 13 May 2009 to the respondents. The application having been granted, four shareholders asked the Commission to state a case for the opinion of this court. These were Mr Lachlan Brown, Mr Iain MacKinnon, Mr A Macrae and the afore-mentioned Mr Ian Campbell Brown. Only the first named of these has, however, pursued the appeal.

Grounds of appeal

[3] The original grounds of appeal are set out in full in the stated case. It is convenient here to summarise them as follows:-

(1) That the Commission did not take into account, and attach sufficient weight to, the evidence that there was other local demand for the shares.

(2) That the Commission erred in law in concluding that the shares could not, or should not, be separated from the croft to which they originally pertained.

(3) That the Commission were unduly influenced by the support for the application of the owner of the common grazings, Argyll Estates.

(4) That the Commission’s decision was contrary to natural justice in that they allowed Mr MacArthur to, in effect, buy the shares, along with the croft, at a price beyond the reach of any other local crofter, especially any young crofter.

(5) That the decision was not in the interests of sustaining the local crofting community and that the Commission exercised their discretion in an unreasonable manner.

[4] By letter dated 29 November 2012 Mr Brown sought to add another ground of appeal which was that the Commission erred in law in respect that they treated the matter as one of assignation of grazings shares rather the assignation of deemed crofts, which said shares had become on the purchase of the croft; sec 3(5) of the Crofters (Scotland) Act 1993 (“the Act”) and decision of this court in Reference by the Crofters Commission, SLC/121/11, decision of 3 August 2012. We allowed this additional ground to be received and answered.

Procedure in the appeal

[5] Neither Mr MacLean nor Mr MacArthur has lodged answers to the appeal, although the latter has made clear that he opposes it. Only the Commission have lodged answers and the appeal has therefore been litigated between them and Mr Brown. Both have agreed that we may deal with the appeal on the basis of written submissions.

[6] We were on the point of beginning consideration of the case when we received Mr Brown’s letter of 2 December 2013 in which he raises questions as to whether Mr MacLean had ever become the tenant of 1 Barrapoll. It is said that the requisite procedure under either sec 10 or 11 of the Act was not carried out on the death of a previous tenant, Mr John MacFadyen, and that as a consequence of that the croft became vacant. It is said to be a consequence of that that Mr MacLean never became the tenant of, or had any other form of entitlement in, the shares and was never in a position to assign them to Mr MacArthur. In his letter Mr Brown suggests that it may be appropriate to grant more time – four weeks is suggested – to investigate these matters but says that he leaves this to the discretion of the Court.

[7] It seems to us that these new matters go well beyond the scope of this appeal. They were not before the Commission when they made the decision appealed against. Presumably they are being raised now, rather than earlier, because they have only now come to light. But we consider that it would not be in the interests of justice to delay this appeal further for the purposes of such investigation. The decision appealed against is dated 3 June 2009. The request for a stated case was lodged with the Commission on 15 July 2009. The case was not received by us until 26 June 2012 but it has now been with us for 18 months. We consider that the Commission and, more importantly, Mr MacArthur are entitled to have it disposed of without further delay. That would still leave Mr Brown free to take any other action he deems appropriate on the basis of the information he now holds. These are matters for him to take up with the Commission, if so advised, rather than with us in the context of this appeal. Accordingly we have decided to deal with the appeal only on the grounds already stated.

[8] We do not intend to set out parties’ submissions at length. Mr Brown’s were, in any event, brief and did not go much beyond stating the grounds of appeal. That is not a criticism: the submissions were perfectly adequate to allow us to understand the points being made. The Commission’s submissions as contained in the stated case were largely in the way of explaining their decision and the basis upon which it had been made. But they were adequate for present purposes.

Dealing with the grounds of appeal

(1) That the Commission did not take adequate account of other local demand; sec 52A(3)(e) of the Act.

[9] In response to this ground of appeal the respondents point to the memorandum prepared by Mr Hugh MacKintosh, their Crofting Services Manager, dated 26 May 2009, production 5. The relevant part of that reads “[I]n the circumstances of this case I consider that whilst there may be interest and demand for the tenancy of the shares from existing shareholders for additional grazings there is more benefit from the sustainable development of the crofting community and the interests of the estate perspectives for the application to be approved thereby reuniting the shares with the inbye croft land.”

[10] It is not entirely clear to whom the memorandum was addressed, although it appears that it was for the benefit of Mr Robin Currie, the respondents’ Area Commissioner, who appears to have been appointed the decision maker under delegated powers. In any event, whoever made the decision would also have had before them Mr I C Brown’s letter of 13 May 2009 which, having said that a large majority of the shareholders greatly oppose the assignation, goes on “The grounds on which we seek to object … are that there is a very high demand within the township from existing shareholders for additional grazing and croft land”. Accordingly the decision maker was well aware of the strength of opposition to the application and of the objectors’ claims about existing demand for extra grazing. There is no basis for saying that this was ignored or less than fully considered. On the contrary, the letter intimating the decision (from Mrs L Gourlay, Crofting Services Manager, dated 3 June 2009, production 6) expressly states “In considering this application we did take account [of] representations made regarding interest and demand for the tenancy of the shares from existing shareholders”. The letter then goes on to explain why consent was being granted, notwithstanding these representations. It says “However, on balance, the Commission consider that it is more beneficial to the sustainable development of the crofting community to reunite the share with the inbye croft land to which it pertains.” There is then a reference, irrelevant for present purposes, to Argyll Estate’s support for the application.

[11] Accordingly there is no basis for saying that the Commission did not take local demand into account. What weight to give it was for them. They were engaged in, as their letter says, an exercise of balancing various interests. They took the view that the interests of sustainable development of the crofting community – one of the general conditions mentioned in sec 58A(9) of the Act as it then stood which they were obliged to take into account – were best served by re-uniting croft 1 with its share. That conclusion was not unreasonable and was within the range of decisions available to the Commission on the facts of this case. This ground of appeal is therefore refused.

(2) That the Commission erred in law in concluding that the shares could not or should not be separated from the croft to which they pertained; sec 52A(3)(a) of the Act

[12] We cannot find anything in the material before us which is capable of being interpreted as meaning that the Commission reached a conclusion that shares could not be separated from the croft to which they had originally pertained. On the contrary the Commission’s desire to re-unite the croft and the shares which had previously gone with it – indeed formed part of it in terms of sec 3(4) of the Act – shows that they were well aware that circumstances can arise in which shares become detached from the croft to which they used to pertain. We do not know – nor do we require to know for present purposes – the precise legal basis of such detachment. The decision and the appeal proceed on the basis that there has been a formal separation. As to their conclusion that the shares should not remain separated from the croft in the circumstances of this case, the reasoning behind that is obvious. Why should 1 Barrapoll, uniquely, be left with no share in the common grazings? Such a situation would be likely to make it a less viable unit, more difficult to work. As the application for assignation notes, at section 13, “Croft 1 has no dry wintering ground for cattle and sheep, therefore machair ground would be vital to wintering these beasts.” There is no suggestion in the material before us to the effect that such statement is factually incorrect. If the suggestion behind this ground of appeal is that the Commission were following a dogmatic policy which prevented them from countenancing the possibility of allocating these shares to another croft or crofter, that does not appear to us to be so. The facts and circumstances of this case amply justify the Commission’s decision. Mr MacArthur was intent on keeping cattle and sheep and he had need of these shares. This is not, therefore, a situation in which a rigid policy was being applied to circumstances to which it did not fit. This ground of appeal is refused.

(3) That the Commission were unduly influenced by the landlords’ support of the application

[13] This might be categorised as a ground under sec 52A(3)(d) of the Act: that the Commission took into account certain irrelevant or immaterial considerations.

[14] It is clear that the Commission took the land owners’ attitude into account. Mrs Gourlay’s letter of 3 June 2009 says so. Was it relevant? Yes, in this sense. Section 58A(3) of the Act requires applications for approval or consent to be intimated to the land owner of common grazings and subsec (4) makes the land owner a competent objector. Accordingly, although on this occasion the land owners were not objecting, it is clear that their view was something which, if proferred, the Commission were bound to consider. It cannot be described as irrelevant or immaterial given the status which the legislation affords the land owner.

[15] Did the Commission attach too much weight to it? We do not think so. Mrs Gourlay’s reference to it is very much in passing: ”We also note that Argyll Estates supported the application”. Mr MacKintosh, in his memo of 26 May 2009, refers to the “interests of the estate” as well as to the sustainable development of the crofting community. But it is clear to us that the Commission decided this application on a very specific basis, which was that it made more sense, from the point of view of sustainable development of the crofting community, to re-attach these shares to 1 Barrapoll than to allow them to go to someone else. As it happens the Estate, as owner of the grazings, agreed with that position but we find no trace in the papers that it was only, or primarily, because the Estate took that view that the Commission granted approval. This ground of appeal is refused.

(4) That the Commission acted contrary to natural justice; sec 52A(3)(c) of the Act

[16] The way in which the Commission are said to have acted contrary to natural justice is that they allowed Mr MacArthur to “buy his way” into the grazings. There is not a shred of evidence to support this. There is no mention at all in any of the papers, save the letter from the Estate, that Mr MacArthur paid anything in respect of these shares, far less mention of the price paid. The application form for consent to assignation does not ask that question. No doubt that is because the Commission have no power to refuse an application for consent which they are otherwise minded to grant simply because a certain consideration has been paid for the shares.

[17] We realise that local interest in croft tenancies being outbid by affluent outsiders is often the cause of resentment. But, if the assignee is otherwise suitable and the statutory criteria of sec 58A are met, it is not within the Commission’s powers to do anything about it. There would have to be something else about the assignee or about the facts of the case which, having the statutory criteria in mind, made approval inappropriate before the Commission could refuse consent. Price paid is not, in and of itself, a good enough reason. In any event in this case there is no evidence that the Commission knew what price had been paid and accordingly they could not have been influenced by it. Accordingly this ground of appeal is refused.

(5) That the decision was not in the interests of sustaining the local crofting community and that the Commission exercised their discretion in an unreasonable manner; sec 52A(3)(f) of the Act

[18] The above is how we have interpreted this ground of appeal so as to fit it within one of the statutory grounds contained in sec 52A(3). As set out in the stated case it reads:-

“It is argued that it is not in the interests of sustaining the local crofting community in Tiree, and in particular in Barrapool, that grazings shares should be assigned to non-family members on the open market for substantial sums of money without the opportunity for local crofters and shareholders to acquire the grazings shares. It is argued that the Commission has a discretion when dealing with non-family assignations to ensure that local demand for grazings shares from other shareholders is fully taken into account to ensure the future sustainability of the crofting community in Barrapool.”

[19] We have already dealt with the objection that the Commission failed to take adequate of local demand. We have held that the Commission took account of it but found it to be outweighed by the desirability of re-uniting these shares with 1 Barrapoll. The Commission did, of course, have a discretion to refuse the application but the reference in the grounds of appeal to non-family assignations is misplaced. Prior to the amendment of sec 8 of the Act effected by sec 12 of the Crofting Reform Act 2007 there was a distinction between family and non-family assignations. Provided the landlord consented in an intra-family assignation, the Commission’s consent was required only for non-family assignations. Section 12 of the 2007 Act changed that and made Commission consent a pre-requisite of any assignation.

[20] Beyond that what is being suggested here is that assignations to local people, where there is local demand, are to be preferred to assignation to “outsiders”. That will normally be a consideration for the Commission when considering croft tenancy assignations. But here Mr MacArthur was already in place as an owner-occupier, having bought the croft from Mr MacLean. The Commission therefore had to balance two competing sets of interests: the demand for more grazing from other crofters and Mr MacArthur’s need for the shares so as to allow him to work 1 Barrapoll more effectively. They had to carry out that exercise having in mind the general conditions of sec 58A(9) and the particular conditions of sec 8(2). In our view they have done that in a way which cannot be faulted. The decision which they reached was a rational one. It was properly explained in Mrs Gourlay’s decision letter. It cannot be described as an unreasonable decision, given 1 Barrapoll’s need for shares in the common grazings. This ground of appeal is accordingly refused.

(6) That the Commission erred in law in respect that they treated the matter as one of assignation of grazings shares rather the assignation of deemed crofts, which said shares had become on the purchase of the croft; sec 3(5) of the Act and decision of this court in Reference by the Crofters Commission, SLC/121/11, decision of 3 August 2012

[21] Section 3(5) of the Act provides that where a crofter has acquired his entire croft other than any right in pasture or grazing land held by him whether alone or in common with others he shall be deemed to hold the right in tenancy until held otherwise and the right shall be deemed to be a croft.

[22] We have not seen the disposition by which Mr MacLean took heritable title to 1 Barrapoll. If it included the grazings shares expressly then they were conveyed to him as a pertinent of his heritable title and would therefore pass to Mr MacArthur when he bought the croft. But, given that further procedure by way of assignation was thought to be necessary, we assume that the situation was that on purchase of the inbye land by Mr MacLean the grazings shares became a deemed croft (or perhaps deemed crofts) under sec 3(5). That this is the effect of sec 3(5) is clear enough from its terms but was affirmed by this court in its decision on the Commission’s Reference SLC/121/11 dated 3 August 2012; see discussion at paras [22] to [30]. The consequence here would be that Mr MacLean, having purchased the inbye land, continued to hold the grazing rights in tenancy as a deemed croft which could be assigned subject to Commission consent.

[23] Mr Brown’s objection is that the Commission treated this as the assignation of grazings shares when it was in fact the assignation of a deemed croft. It is said that different considerations apply. The point being made is that the link with the original croft is broken and one has a free-standing croft which can be assigned to anybody. Subsequent owner-occupiers or tenants of the original croft have no better claim to it than anyone else.

[24] We do not think that there is any substance in this ground of appeal. That is because the assignation of grazings shares, howsoever it arises, is governed by the same statutory code, viz secs 8 and 58A of the Act. Section 8 deals with assignations of crofts, including, specifically, at subsec (7), any right in grazing land deemed to form part of a croft. In said Crofters Commission Reference we held, at paras [31] to [33], that the effect of subsec (7) was to allow a grazings share to be assigned separately from the croft and that when that was done, the effect was to divide the croft. But such an assignation falls to be dealt with under sec 8 and sec 58A in exactly the same way as the assignation of a croft (in the sense of the tenancy of in-bye croft land) or deemed croft created by virtue of sec 3(5). It may or may not be the case that the Commission did not realise they were dealing with a deemed croft here (although we think that would be the inference to be drawn from the statement, in the application form, that the croft had been sold to the proposed assignee who wished to run it and the grazing share with it) but it does not matter because they in fact treated the application in the same way as the assignation of a deemed croft has be to be treated. Accordingly this ground of appeal also fails.

Disposal

[25] The stated case contains three questions, as follows:-

1. In granting the application for the assignation made by Mr MacLean did the Commission fail to take into account certain relevant or material considerations in not considering fully the evidence that there is local demand/requirement for grazing on Barrapool Common Grazings and that other shareholders in the common grazing are in need of enhanced grazing rights?

2. In granting the application for the assignation made by Mr MacLean did the Commission err in law in deciding that the grazing shares should be re-united with the in-bye croft ground to which it previously pertained?

3. In granting the application for the assignation made by Mr MacLean did the Commission exercise their discretion in an unreasonable manner?

We answer all three in the negative and, consequently, the appeal is refused.

Expenses

[26] We have allowed motions and submissions on expenses to be lodged with the Principal Clerk within 21 days of the date of intimation hereof.