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| Wind turbine on Lewis - picture credit Tim Riches |
The townships had applied to
the Crofting Commission (CC) under section 50B of the Crofters (Scotland) Act 1993 for permission to diversify the use of their respective common
grazings west of Stornoway into renewable energy generation by wind turbines.
These applications were all refused by the CC. That refusal was appealed to the
Land Court (LC) which rejected the appeals on 17 July 2019 - you can read the full LC judgement here. This post is about
why the CC refused the s50B applications and why the LC refused the appeals. Beware that this is dust dry legal stuff - there was no stirring oratory by impassioned advocates warning of the threat of new Highland Clearances or the like to report. So in that vein, let’s first look at what s50B says:-
50B
Use of common grazing for other purposes
(1) A crofter who holds a right in a common
grazing may propose to the grazings committee ... that a part of the common
grazing be used other than for—
(a) grazings ...; or
(b) woodlands.
(2) The use proposed must not be such as
would be detrimental to—
(a) the use being made, as at the time of
application, of the other parts of the common grazing; or
(b) the interests of the owner.
[Sub-sections (3) to (5) contain provisions
requiring the grazings committee to call a meeting of the crofters sharing the affected
grazing to hold a vote on the proposal and for the proposal to be intimated to
the owner who has the right give views which must be made known to the meeting:
all of this was duly complied with by the four townships.]
(6) If the vote is in favour of the proposal
the [grazings] committee ... shall apply to the [Crofting] Commission seeking
their approval for its implementation.
The criteria the CC are to apply in deciding whether to approve a s50B proposal are contained in a different section, s58A(7). This section also applies to all other applications to the CC under the crofting legislation (including, for example, for consent to assign a crofting tenancy). The relevant wording is:-
(7) In considering their decision on [an]
application, the [Crofting] Commission must have regard to the following—
(a) [not applicable to s50B applications]
(b) the interests of the estate which
comprises the land to which the application relates;
(c) the interests of the crofting community
in the locality of that land;
(d) the sustainable development of that
crofting community;
(e) the interests of the public at large;
(f) any objections received under subsection
(4) or (5A) [= objections from the landlord/owner of common grazings, local
crofters or the wider public received within 28 days of advertisement of the
application in the local press or longer period with good reason for the delay];
(g) any plan of the Commission approved and
published under section 2C [= the CC’s Policy Plan];
(h) any other matter which the Commission
consider relevant.
Why did the Crofting Commission refuse the townships’ s50B proposals?
Section
58A(7) in effect requires the CC when deciding upon a s50B proposal to balance
the competing interests of the estate, the crofters and the wider public
interest before deciding which is/are to prevail and, consequently, whether to
approve or reject the proposal. However, s50B(2) says that any s50B proposal “must
not be such as would be detrimental to ... the interests of the owner.” In
other words, if it would be detrimental to the owner of the affected common
grazing, it is not a valid proposal under s50B and, therefore, cannot go
forward to be evaluated on its merits in light of other interests under the s58A(7)
balancing exercise. The Stornoway Trust as owner of the grazings involved naturally
objected that the townships’ proposals would be detrimental to its deal with LWP
given that these proposals involved, in effect, pinching more than half of
LWP’s turbines. [3] The CC agreed
and this is why the s50Bs were refused.
The townships’ appeals to the Land Court
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| Turbines on Arnish Moor, Lewis - picture credit Mike Shailes |
The townships’ appeals to the Land Court
First, it’s crucial
to understand the nature of an appeal to the Land Court. It’s not simply a case
of hoping that the LC will reach a different decision from the CC on the merits
– or in other words saying to the LC: “The CC turned us down so will you let us have our community windfarm,
please?” Rather, an appeal from the CC to the LC is, in essence, to identify and
correct a failure of due process in the proceedings before the CC. In other
contexts, this is known as “judicial review”. The consequence of a successful
appeal from the CC to the LC can be that the LC quashes the CC decision
complained of but remits back to the CC to decide the matter afresh. And the CC
could come to the same decision again although this time in full compliance
with due process such that the second decision is invulnerable to challenge. [4] Thus, an appeal to the LC must be
brought under one (or more) of six grounds in s52A(3) of the Crofters Act. These are that the CC:-
(a) erred on a point of law;
(b) made a finding as to a fact material to
the decision ... but did not have sufficient evidence on which to base that
finding;
(c) acted contrary to natural justice;
(d) took into account ... irrelevant or
immaterial considerations;
(e) failed to take into account ... relevant
or material considerations; or
(f) exercised their discretion in an
unreasonable manner.
There’s no
suggestion of the CC having acted contrary to natural justice (ground (c)) but
the townships’ lawyers had appeal points under each of the other five grounds
so let’s look at these in turn.
Ground (a) – the CC erred on a point of law
Under this
ground, the townships’ counsel argued that the CC had erred in law by misinterpreting
the Crofting Act to mean that a finding that the s50B proposal would be to the
owner’s (i.e. SYT’s) detriment meant that the proposal was bound to be refused
without proceeding to the s58A(7) balancing exercise in which the owner’s
interests were just one of the considerations to be weighed in the balance: in
other words, that, in s50B, owner detriment trumps all other considerations.
Perhaps
because he didn’t have much confidence in that argument, counsel weaved in a
subtly different argument to the effect that, even if it is the case that
landowner detriment trumps all other considerations, the wording of s50B is
such that it is for the grazing committee
(GC) to decide whether there is owner detriment and, if, as happened here, the
GCs decided there was no detriment, then there was nothing in the Crofting Act
conferring a jurisdiction upon the CC to overrule the GC’s decision and the CC was
obliged to proceed to the s58A(7) balancing exercise irrespective of its (the
CC’s) views on owner detriment.
The Land
Court had little difficulty in dismissing both of these arguments. The wording
of s50B is unambiguous that there is no valid s50B proposal if it involves
detriment to the owner: in s50B owner detriment does trump all other considerations. Even if s50B had been
ambiguous in this regard, Pepper v Hart reference to Ministerial
statements to Parliament during the passage of the bill which enacted s50B made
it plain that it was intended that landowner detriment trump all other
considerations. [5] And even though
there’s nothing in the Crofting Act explicitly giving the CC power to rule on
landowner detriment, the LC noted:-
[52] ... Part of the approval process must surely be that the
Commission satisfy themselves that what they have before them is a valid
proposal which they can competently approve. In this respect sec 50B
applications are in no different position from any of the other matters which come
to the Commission for their consent or approval under the 1993 Act: if the
Commission are aware of facts and circumstances which would make the
application incompetent they are entitled, indeed obliged, to refuse it. ...
[55] In our view, therefore, nothing in sec 50B takes away from the Commission
the power they have in any other application for approval or consent, to refuse
an application as incompetent. It is true that nothing in sec 58A expressly
confers such a power on the Commission, in relation to any application, but it
is surely a given that the Commission are entitled to investigate any issue as
to validity and are not entitled to approve applications which they believe to
be invalid.
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| One of the four townships - Melbost & Branahuie. Picture credit Guido |
Ground (b) – the CC made a finding as to a fact but did not have sufficient evidence on which to base that finding;
Here the
townships’ argument was that, even if owner detriment does trump all other
considerations, the CC didn’t have sufficient evidence of the detriment the
Stornoway Trust (SYT) alleged it would suffer if the townships’ proposals were
permitted to go ahead.
Much has been made in the
public reaction to the Land Court’s rejection of the townships’ appeals,
thereby effectively killing off their community windfarm projects, of the fact that
there has never been any kind of hearing or enquiry to thrash out the respective
merits and demerits of the SYT/LWP’s and the townships’ plans. [5A] But the townships’ own counsel
conceded during the course of the appeal that he was not seeking a hearing by
the CC (or anyone else) and that a decision could be reached on the basis of
the written submissions of parties. [6]
That concession made, this
ground of appeal resolved itself into a discussion about whether the SYT could
be said to suffer detriment from the loss of something (the LWP deal) which was
so speculative considering the many hurdles it still has to cross (section 19A
approval, Contract for Difference and interconnector – see my previous post).
But on this, the LC concluded:
[69] ... if the sec 50B schemes go ahead the Stornoway Wind Farm [i.e.
the LWP scheme], as presently planned, cannot. So the sec 50B schemes are not
just potentially detrimental to the Trust’s plans, they are potentially fatal.
[70] The [townships] say that because of all of the current uncertainties the
Trust does not have a present legal interest to defend. They will, say the [townships],
only acquire such an interest once all the consents and infrastructure required
are in place. We do not accept that argument. The Trust has an interest to
defend and protect the progress and investment already made from further
challenges to the viability of the Stornoway Wind Farm. Certainly any of these
other uncertainties could kill off the Stornoway Wind Farm but so too would the
use proposed in the sec 50B applications, at least so far as a wind farm on the
presently envisaged scale is concerned. In that situation approval of that use
would undoubtedly constitute what [SYT’s counsel] called “an immediate, present
detriment” to the landowners’ interests.
Ground (c) – the CC took into account
irrelevant or immaterial considerations
Another
aspect of the case that hit the headlines was that the SYT’s objections to the
townships’ s50B proposals as being detrimental to its interests as owner of the
affected land had been submitted to the CC late – about 16 months after the 50B
aplications were made which is obviously well outside the 28 days for lodging
of objections mentioned in s58A(4) of the Crofting Act (the section which deals
with the procedure about how applications to the CC are to be handled). So the
townships’ argument here was that, the SYT’s objections being time barred, they
were “irrelevant or immaterial considerations” which the CC should have
ignored.
In actual
fact, there was more to the delay in the SYT lodging its objections than meets
the eye. This stemmed from the fact that, in terms of the Crofting Act [7], all applications to the CC must be
made on a pro forma application form provided
by the CC. The problem was that the CC didn’t have an application form for s50B
so it was faced with having to devise one. This set off a sequence of
bureaucratic faffing around which led in turn to uncertainty about the exact
date on which valid s50B applications had been made and publicly advertised.
The SYT said that the CC had told them they would be informed when all this had
been resolved and when their 28 days for lodging objections would begin to run
except it appeared the CC forgot to do this. But when the CC did finally fire
the gun (after it and SYT had, in the LC’s words, spent “a year or more in a
fog of uncertainty”), the SYT duly lodged its objections within 28 days
thereafter. S58A(5A) allows objections to be received late if the CC “consider
there is a good reason why the objection is late”. The LC therefore had no
difficulty in taking the view that this saga represented a good reason why the
SYT’s objection was late. [8]
Ground (e) – the CC failed to take into
account relevant or material considerations
The
considerations the townships claimed the CC had failed to take into account
here were the benefits which would
accrue to the SYT from the townships’ s50B proposals. What the LC said about
this was:-
[85] ... the Commission were not required to carry out a comparison of
the two sets of schemes. Nor was it for the Commission to decide what was in
the landowners’ best interests: that was for Stornoway Trust themselves. As
long as the Trust were able to demonstrate to the Commission that the sec 50B
schemes involved detriment to their lawful interests that was all that was
required to justify the Commission in refusing the applications as invalid.
I struggle a
bit with the first two sentences of that. Surely the second sentence can’t mean
that the CC couldn’t question an assertion by a landowner that a s50B proposal
would be to its detriment and require that to be proved to its (the CC’s)
satisfaction. Surely, too, the detriment alleged must be something objective which
the average person acting reasonably would consider to be detrimental as
opposed to something which happened to offend a mere caprice of the landowner. [9] And as regards the first sentence,
I should have thought that the CC was
required to compare the two schemes to see whether it might not be the case
that the s50B proposal was objectively more beneficial to the landowner than
what he stood to lose with the consequence that there was no detriment. Be that
as it may, I think the LC’s conclusion on this, though somewhat obliquely
expressed, was that the CC had taken
into account the benefits to the SYT of the townships’ proposals but had
nevertheless concluded (as the CC was entitled to do) that, comparing LWP’s
proposed 180MW scheme with the townships’ 105MW and the risk that LWP might not
proceed with the remaining 75MW, there would still be a net detriment to the
SYT if the townships’ s50Bs were approved. [10]
Ground (f) – the CC exercised their discretion in an unreasonable manner
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| Sandwick - Picture credit Chris Murray |
Ground (f) – the CC exercised their discretion in an unreasonable manner
Finally, the
townships attempted an argument that, in refusing their s50Bs, the CC had
exercised their discretion in an unreasonable manner in the sense that, by not
proceding to the s58A(7) balancing exercise, the CC had not exercised any
discretion at all. But this argument was really superseded by the fact that the
LC had already decided that, by reason of the s50Bs involving detriment to the
landowner, the CC was not required to proceed to the balancing exercise. That’s
not exercising a discretion, it’s applying the law. [11]
Aignish
All of these
appeal points applied equally to all four townships but Aignish had a couple of
extra points of their own.
The only one
of these worth mentioning stemmed from the fact that, in May 2019, LWP had
submitted a new planning application to vary the layout of their proposed
windfarm such that there will be a smaller number of more powerful turbines but
still (as I understand it) with the same aggregate of 180MW. Aignish’s proposed two turbines would,
it was said, present less, or even no, conflict with this revised layout.
That would therefore lessen, or even remove altogether, the landowner detriment
which blocked their s50B proposal. Though not articulated as such in the LC’s judgement,
this was presumably a ground (e) appeal point, a relevant or material
consideration the CC had failed to take into account. However, this variation
of the plans was all something which happened after the CC had made its decision on Aignish’s s50B. Therefore, it
was not a valid appeal point (which would have to found on something which had
happened before the CC made its
decision). None of this, however, prevents Aignish from making a new s50B proposal in light of new
circumstances in the future if a revised, non-conflicting layout of the LWP
scheme comes to pass. [12]
Comment - time to repeal section 50B?
“A terrible
decision by the Land Court” was how one (non legal) commentator described the
appeal judgement.[13] That, with
respect, is to misunderstand the nature of the appeal – that it was not to revisit
the s50B proposals on their merits – and shoot the messenger. And in so far as the loudest criticism is
that the LC did not order a wide ranging hearing into the respective merits of
the rival schemes (“Land Court shocker as evidence not required” said the same
commentator [14]), it appears to
overlook that the townships’ own counsel conceded that a hearing was not
necessary. In fact, there's nothing in the LC's judgement that's very controversial from a legal point of view and, reading it, you can almost sense that the townships' counsel knew he was fighting something of a rearguard action. But if this appeal has shown something up to be less than
satisfactory, it’s not the Land Court (or the Crofting Commission) but section
50B of the Crofting Act.
Considering that
crofters are due 50% of the capital value of land released from crofting for
development [15], it’s
understandable why many have come to believe that croft land is, in a practical
if not strictly legal sense, jointly owned by the landlord and crofter(s). But
while landlords have the power to realise their 50% by the process called “resumption”,
there’s no mechanism for crofters to take the same initiative: crofters can’t
resume from their landlord. It’s tempting – and I confess I fell into this
error when I wrote my previous post on this topic – to see s50B, introduced
into the crofting legislation by the Crofting Reform etc. Act 2007 [16], as the redress to this imbalance:
the mirror image of resumption (and s19A) and the mechanism by which crofters
can take the initiative to develop croft land for alternative uses. But the
Aignish et al appeal has thrown into
very sharp relief that it’s not: a
relatively small amount of detriment to the landowner is sufficient to block a
s50B proposal no matter how beneficial it might be to the local crofting
community and wider public. Nor is this a result of some sort of drafting error
in the legislation – it was intended to be thus as remarks quoted by the LC in
its judgement (para [57]) made by the Minister in Parliament when the 2007 Act
was going through make clear:-
There has been considerable misunderstanding of the purpose and
implications of [s50B]. In the light of some of the more inaccurate comments,
it is not surprising that some owners are concerned. This is not a backdoor
route to crofting community control of the owner’s interests in common
grazings. … No one will use the provisions to build houses or wind farms on
grazings, as the owner’s rights – including the right to resume – will
persist. This is about facilitating new uses that would not be detrimental to
existing uses by the graziers or the owner. [Emphasis added]
Consequently,
s50B is, in the words of the LC (para [61]), no more than:-
a vehicle whereby crofters with shares in the grazings can propose
additional uses beyond the traditional rights of grazing, peat-cutting and
thatch-taking. But (a) the express provision protecting the interests of the
landowner and (b) the absence of the powers which would be required to compel a
landowner to do whatever was necessary (such as grant a lease of land) to
facilitate the proposed development show that what was envisaged was
consensual development or, if not always that, at least development which made
no great inroads on the landowner’s rights and interests. [Emphasis
added]
This, of course, is entirely
consistent with the fact that puzzled me a bit when I wrote my previous post – that s50B contains no provision for compensation to, or value
sharing with, the landowner.
Perhaps,
then, the lesson from the experience of the four Stornoway townships as
illuminated by the recent Land Court judgement is that it’s time to take
another legislative step forward and give crofters the same rights as landlords
to develop crofters common grazings for alternative uses. That could involve
tweaking s19A [17] to make it equally available to
crofters. And repealing s50B altogether.
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| Aignish - picture credit Google Streetview |
[1] I use the word “partnership” in a loose, non-technical sense here because the relationship between SYT and LWP will be as landlord and tenant. There is no partnership between them in the strict legal sense of that word.
[2] The four
townships are (1) Aignish; (2) Sandwick & Sandwick East; (3) Sandwick North Street; and (4)
Melbost & Branahuie.
[3] Between
them, the townships proposed a total of twenty one 5MW turbines on more or less the
same sites as twenty one of LWP’s twenty four consented turbines south of the old A858 road from
Stornoway to Achmore. This would leave LWP with just three turbines south of that
road plus the twelve turbines it has consent for to the north of the road.
[4] The LC
also has power to substitute its own decision without remitting back to the CC (strictly,
by directing the CC to make a certain decision). See s52A(4) of the Crofting Act. I don’t know if there’s any case law giving guidance as to the
circumstances in which the LC would, absent consent of the parties, be likely to substitute its own decision as opposed to remitting back to the CC. In particular, if the LC quashed a
decision of the CC on one of the grounds in s52A(3), would it (the LC) ever
(absent consent) proceed to determine the case on its merits?
I don’t know the answer to that.
[5] Pepper
v Hart is a 1992 decision by the House of Lords (sitting as the UK’s
then supreme appellate court) to the effect that, to assist the interpretation
of ambiguous legislation, it's
permissible to consult parliamentary materials (Hansard etc.) from when the
relevant bill was going through Parliament. But such parliamentary materials
can't be used to contradict unambiguous
legislation. You can read the judgement here.
[5A] – see here
for example.
[6] See
para. [71] of the Land Court judgement.
[7] s58A(2)
[8] The full
story of the “year or more in a fog of uncertainty” over the formalities of the
townships’ s50B applications is contained in paras [74] to [79] of the LC’s judgement. In fact, the LC treated this aspect of the case as being an appeal
point under ground (f), namely, that the CC had exercised its discretion in an
unreasonable manner by receiving the SYT’s objections late in these
circumstances. And the LC concluded that it had not. The LC was also moved by
the fact that nothing had changed during the delay so as to give the SYT any
advantage in its objections being late, nor did the delay put the townships at
any disadvantage in that regard.
[9] At
paragraph [83] of its judgement, the Land Court said this on the subject of how
much detriment was required for the
purposes of s50B(2):
Will any detriment do? Section 50B does not say it has to be
substantial or significant or more than de minimis.
Obviously it has to be real, not spurious. Beyond that, ... there may be
minimal levels of detriment best left to be part of the balancing exercise of
sec 58A(7); in other words room for at least a de minimis exception.
However, we do not need to express a concluded view in these appeals since the
level of detriment found by the Commission was significant, indeed substantial.
[10] The
townships also ran an argument under ground (e) that the CC had also failed to
take into account: (i) the other matters apart from the interests of the estate
it is required to have regard to when carrying out the s58A(7) balancing
exercise, principally, the interests of the local crofting community and the
sustainable development of that community; and (ii) the possibility of
attaching conditions to a s50B approval to mitigate any detriment to the SYT.
Point (i) is simply the ground (a) argument about whether landowner detriment
trumps all other considerations in s50B in a different form and as to which the
LC had already ruled (see para. [84] of the judgement). The LC disposed of
point (ii) by observing that, while the CC didn’t appear to have considered the
possibility of attaching conditions, that didn’t undermine their decision to refuse
the s50Bs because it was hard to imagine what sort of condition might have
worked, given that the rival schemes can’t co-exist, and, anyway, mitigated
detriment is still detriment which (assuming it to be more than de minimis –
see footnote [9] above) falls foul of s50B(2) (see para. [86] of the judgement
which mistakenly refers to s50B(1) instead of s50B(2)).
[11] See
paras. [15] (first three sentences) and [87] of the judgement.
[12] See
paras. [19] & [89] of the judgement.
[13] See here
[14] See here
[16]
Section 50B was inserted into the 1993 Act by s26(2) of the Crofting Reform etc. Act 2007.
[17] Section 19A of the Crofters (Scotland) Act 1993 gives landlords an alternative route to
using croft land for development short of full resumption. The Stornoway Trust
are using s19A as the vehicle for delivering the LWP scheme although that case
has not yet been heard on its merits.
