Un­writ­ten terms need a look­ing at

The Press and Journal (Inverness) - - NEWS - Sat­ur­day, July 29, 2017

in the Reg­is­ter of Com­mu­nity In­ter­ests in Land. When reg­is­tered, if the landowner pro­poses to sell the farm or part of it they must give the ten­ant the first chance to buy.

The Agri­cul­tural Hold­ings (Scot­land) Act 2003 con­tains a val­u­a­tion for­mula. If the ten­ant chooses not to buy, the landowner is able to sell the farm al­beit with the sit­ting ten­ant in place.

Th­ese rights don’t ap­ply to lim­ited du­ra­tion ten­ants and short lim­ited du­ra­tion ten­ants un­der the 2003 act.

If the land­lord sells farm­land against which a ten­ant has reg­is­tered a pre-emp­tive right to buy but doesn’t give the ten­ant first op­tion, then the ten­ant has an ab­so­lute right to buy from the pur­chaser re­gard­less. One of the things one does when buy­ing farm­land is to check the Reg­is­ter of Com­mu­nity In­ter­ests in Land to see if a se­cure agri­cul­tural ten­ant has reg­is­tered their pre-emp­tive right.

How­ever, the Land Re­form (Scot­land) Act 2016 is abol­ish­ing the need for a se­cure agri­cul­tural ten­ant to reg­is­ter their pre-emp­tive right to buy. It will arise au­to­mat­i­cally if the land­lord de­cides to sell. When the need to reg­is­ter is abol­ished, which is likely later this year, there will be no reg­is­ter which a prospec­tive pur­chaser can check.

It is likely that a pur­chaser will want to ob­tain some strict war­ranties from a seller that in fact there isn’t a ten­ant who might come out of the wood­work at a later date.

Like­wise, landown­ers who are con­tem­plat­ing selling land where there might be an in­for­mal oc­cu­pa­tion ar­range­ment will want to be sure what the na­ture of that oc­cu­pa­tion is and whether it can be brought to an end. Oth­er­wise they risk fall­ing foul of a claim by a pur­chaser who finds them­selves be­ing forced to sell by some­one who was a se­cure ten­ant and who wasn’t given the right to buy.

The abo­li­tion of the need to reg­is­ter a pre­emp­tive right to buy may mean that many un­writ­ten ar­range­ments will have to be looked at to es­tab­lish what the rights and obli­ga­tions of the landowner and the oc­cu­pier are.

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